Why do businesses need ERP?

 What is an ERP?

For the growth of an enterprise, it is important to manage its resources most efficiently. The term resource can imply anything – stock or supply of money, materials, employees, and any other asset of the organization, that enables the business to function effectively. An ERP (Enterprise Resource Planning) solution helps you do the same.

It simply is a business process management software that manages and organizes a company’s finances, supply chain operations, reports, human resource activities, and so on. Multiple software managing different business processes like HR, finances, Marketing, etc, that never communicate to each other doesn’t allow an organization to function to its full potential. An ERP integrates the solutions to manage all business processes in a single platform bringing together all the processes and helps to create a seamless workflow.

It enables cross-functional collaboration between departments by connecting them and gives more opportunities to plan and streamline business processes.

 Why is ERP necessary for a company?

We know that data has become the most important resource of the century and organizing and planning are necessary. An ERP stores all your business data into a single database, allowing all departments to work with the same information and thus break data silos within organizations. An ERP system thus enables organizations to manage all their business processes using a centralized and integrated system improving operational efficiency and productivity. It also brings improvements in making data-driven decisions.

Benefits Of ERP System

Enhanced Reporting: An ERP system provides better reporting tools with real-time information. Moreover, the advantage is that since it acts as a single source of truth for all business information and there will be no data redundancy.
Customer Service: Since there is better access to customer data, it improves response times, order accuracy, and on-time deliveries resulting in higher customer satisfaction.
Cost Savings: With better inventory planning, customer service, and vendor relationship management, the company would save a lot.
Better Data Security: Dedicated security resources, user-based access, and access restrictions, stringent password policies and encryption standards, etc in an ERP system ensures data security and prevents organizations from malicious software attacks.

Where does ERP offer improvements in business?

FINANCES: An ERP finance module gathers financial data giving an overview of your finances and creates reports including financial statements, ledgers, profit tracking, balance sheets, etc. Thus, an ERP helps you cut down on entering information manually and lets you access data any time anywhere. The worries of accurately managing costs are also taken care.
HUMAN RESOURCES: An ERP HR module gives ideas on hiring, incentives, payrolls, and other tasks. Employee performance can also be tracked and even loopholes in the functioning of HR can be brought under control. When integrated with the Project Management module, it also gives an analysis of how much manpower is required on different projects.
MANUFACTURING: An ERP system simplifies business communications within manufacturing organizations and automates daily processes. It offers manufacturers the ability to fulfill customer needs and also manage their resources seamlessly with the provision of real-time data.
SUPPLY CHAIN: No longer do the company’s sales details have to be handwritten or managed in Excel sheets and tracked manually, instead the ERP can track the inventory in the warehouse and a lot of time and money can be saved.