ERP – The Advantages Of ERP In Business Management

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Enterprise Resource Planning or ERP system softwarealso known as ERP, or Integrated Management Software, is a tool that is more than vital for any company wishing to improve its organization. But what do we know about this system and its advantages? 

What is ERP?

It is a software package that allows you to consolidate the database of the entire company and better manage it. It allows you to manage via a single platform all the services (called modules) within the company such as production, stock, accounting, and many more. All departments, therefore, have access to the same database and the same information. When an employee enters or changes data within a department, the database is immediately updated throughout the company. If, for example, a sale was made during the day and the salesperson enters it into the database, this modification will be instantly applied to the other services., such as accounting, inventory management, production management, etc. There is therefore no need to check or enter this new sale in the database of each service. Remember that ERP is not only aimed at large companies, but also at SMEs that want to better organize their activities.

Modules

Large companies such as SMEs can choose the modules to integrate into the ERP according to their needs. The publishers offer tailor-made versions, aimed at meeting the requirements of companies, whatever the size and whatever the sector of activity. Indeed, there are different versions for different sectors of activity.

Commercial management

This module includes inventory management, which allows you to keep an eye on the available stock, the stock already reserved but also to manage supplies. Purchasing management helps to better manage suppliers, prices, and supplier deadlines. It also allows you to control quotes as well as orders placed with suppliers, possible imports, etc.

The commercial management module also includes sales management. It facilitates the management of prices as well as items for sale. It offers a better overview of the quotes drawn up, the purchase orders as well as the delivery.

To maintain good relationships with customers, CRM management is an integral part of this business management module. It allows you to manage contacts while classifying the exchanges already made with customers. This module includes the management of ongoing marketing campaigns and their impact.

Accounting management

Whether general, auxiliary, or analytical accounting, this module allows you to keep an eye on the financial situation of the company as well as on all financial movements in the company, even the smallest.

This module allows you to update the FEC or the File of accounting entries in real-time. Remember that any business is obliged to present this file to the tax authorities. This file relates all the accounts of the company.

Production management

This module makes it possible to manage the list of nomenclatures (elements necessary in the manufacture of a product), the manufacturing process but also allows better quality monitoring. It allows the monitoring of the site over time in the case of a construction of a detached house for example.

Decision reporting

The decisional reporting is based on the various data of the company to make a statement of the evolution of the company by taking into account the production and the costs incurred.

What would you gain from setting up an ERP?

The implementation of an ERP in your company offers you a multitude of advantages:

  • First, it gives you the opportunity to improve the organization within your company. By centralizing and automating data, this system allows you to remain reactive and above all very competitive in your activity.
  • Centralized data prevents loss of time and allows each department to work simultaneously.
  • The risk of errors is minimal, even almost nonexistent with this system since there is no longer any risk of the data being duplicated.
  • It is not uncommon to lose some data when the data is entered manually. ERP quickly loses data that can be precious to you.
  • Optimization of management processes (economic and financial flows),
  • The consistency and homogeneity of the information (a single item file, a single customer file, etc.) which makes it possible to comply with standards,
  • The integrity and uniqueness of the Information System,
  • Sharing the same information system facilitating internal communication or mobility,
  • The globalization of training (same logic, same ergonomics),
  • A productivity aid,
  • Centralized control of the company,
  • Help in making a quick decision.

But the disadvantages?

The use of an ERP is not without drawbacks:

  • It is a complex system that requires a certain know-how. It will, therefore, be necessary to think of in-depth training for your employees, but also a period of adaptation that can be longer depending on each person.
  • However, the game is worth the effort as you can optimize productivity with this system. An ERP processes a very large database, so think about using a tool that offers powerful servers that will allow you to navigate smoothly.
  • Once implemented, an ERP is difficult to uninstall. So you find yourself a little “hooked” to the ERP editor. It is therefore more than important to think carefully before choosing a publisher.
  • Request for organization and thoroughness,
  • The complex implementation,
  • Good knowledge and questioning of business processes,
  • Difficulties of appropriation by the personnel of the company linked to the changes,
  • Every ERP has at least one Achilles heel: the modules are of unequal value.
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