Implementing ERP for Business Sustainability in 2024
Any growing business depends upon the growing healthy planet. Today all the top business companies are understanding the importance of shifting their business needs to a sustainable means as we are all aware of the climate change issues. By empowering the business needs as per the climate changes & Implementing ERP for Business Sustainability in 2024; it helps achieving competitive advantage and growth.Â
Due to climate change, the weather is currently decreasing the crop yields and is increasing the water scarcity. This phenomenon has become a threat to supply chains and is the main reason for the ongoing rise in the costs of raw materials.
What is business sustainability?
Business sustainability is conducting the business operations in a manner that does not harm people and the planet, with assurance of longevity of the business.
According to the Institute for Management Development (IMD), 62% of executives consider a sustainability strategy is necessary to be competitive today, and another 22% think it will be in the future.
Businesses aim for longevity, now they are bound to include sustainability in their business plans. One way to achieve this sustainability by using a system is called ERP – Enterprise Resource Planning. This system helps make the manufacturing process better, by lowering the costs and waste, improving the planning for supply and demand, and makes the business more effective.Â
Business waste is not just the physical waste, it can be in various forms. Business can be sustainable by cutting down on energy usage, materials and labor waste. This is important for many industries like manufacturing, production, supply chains, food & beverage dealing with chemicals and materials that can be harmful to the environment.
How adoption of ERP will help to attain sustainable goals?
Business sustainability is a long term decision taken by the top management of the company which will in long-term help it survive and grow business in various aspects.
Here are some ways ERP can help the companies to sustain longer:
Go Paperless, Save Resources.
One of the reasons why companies adopted the ERP system was to go paperless, store the confidential documents and information in a secured system. It helps save paper as well as the storage capacity and works in the favor of the environment as well. This holds a special place for the big and large companies who have operations spread across the globe and huge workforce. With the ERP system, you can store, send and share the scanned documents, and generate business documents like vendor bills, invoices, contracts can be approved, signed with electronic signatures without need of any physical resource.
Green Manufacturing Practices
The main reason any business can’t go sustainable is that the management has not done proper planning for the rightful needs. By monitoring and analyzing production data companies can identify opportunities for efficiency improvements and waste reduction.
As we adopt the ERP system, it has a functionality to manage a lot of such aspects like:
- Stock / Inventory Management : Automatic inventory management helps the company to make sure that the products served are always available in the factory. It also shows expiry of the products, and can pinpoint the damaged products too. This management system will also tell how much material is not used or not sold by FIFO or FEFO strategies.
- Overproduction : Make-to-order feature makes your procurement process more efficient. And on the other hand we have real time data of sales so companies can do the forecasting very easily to avoid overproduction.
Supply Chain Visibility and Coordination
By implementing ERP, it can provide the end-to-end visibility of your company’s overall performance and operations. Departments can overview their own metrics and can track the performance to plan the further operations. From the origin of raw materials to monitoring environmental impact of suppliers, everything can be obtained by one system.
ERP system implementation improves the coordination between the departments as workflows between the teams are synchronized in a well curated manner. A tremendous advantage of an integrated ERP is providing the interconnectedness and automation of the flow of information across departments, allowing a smoother, faster, and more transparent coordination where decisions are streamlined.If the workflows are not synchronized one might not be able to get the proper information and due to the same misinterpretation of the operational processes can happen.Â
Quality check and PLM (Product Lifecycle Management)
ERP modules are customized in such a way that quality check and PLM can be managed so the company can identify, monitor and trace all the related data. By setting up the quality check standards within the system, companies can reduce the wastage of materials and product delays. ERP modules can be set-up with quality control plans and initiate the inspections at specific stages of inventory management. By setting up automated quality alerts enables businesses to reduce the occurrence of defective products.
Integrating PLM with ERP helps companies to manage the entire product lifecycle from design to development into one system till the disposal of the product. This can help to fasten up the product development process as well.
Streamlined Logistics and Route Optimization
An ERP system enables streamlining the logistics delivery by considering the speedy routes. This logistics module can help to conserve time and human resources but also reduces the gas emissions. ERP solution empowers the maintenance of scheduling shipment tracking, and preventing unnecessary transportation of goods between the same locations. This way the end consumer gets the products on time without any delays and brand reputation is held high.
The sustainability will ensure the business growth by giving following outputs to the business:
Who is responsible for sustainability of your business — Top level, Middle level, employees, collaboration amongst different level of companies  (Coming soon)