ERP software implementation integrates all divisions in an organization into a single system. Every division has its own module under the enterprise resource planning system. Each module is then customized and links added to other modules in a bid to replicate the company's business process data flow.
Consider the processes initiated when a supplier delivers goods to the company. The entry made under inventory is sent forward in real-time to all concerned divisions. The production division gets an update, and can initiate processes awaiting the arrival of goods.
The entry also reaches the accounting and finance divisions at the same time. They compare the inventory update against the vendor's invoice and documents from the procurement division, and issue payments as necessary. The system updates all this in real-time and any desk in any division causing a delay can be identified by managers keeping track of process updates.
The advantages of ERP software spanning the entire company are quite obvious. Transparency and accountability show a marked increase, and so do efficiency and quality. Everything from costing and order tracking to inventory is optimized.
With no paperwork required, every byte of data in the company can be centralized. It's a tough job to get the system operational, since the implementation team has to replicate the entire company's business processes on the system. The customization of each module has to be perfect, and so does the data flow between the modules.
But once it is done, everything that was being done physically with papers, files and phone calls can be done faster and better with ERP software. More importantly, the company's staff, management and even vendors need to be trained to use the system. It's vital to ensure that staff are not ignoring the system and doing things the old way.
ERP software implementation also takes a lot of time and is considered expensive even on an enterprise level. Migration is needed to transfer data from old systems, and the implementation has to be done by a joint team of outside consultants and the company's top managers from each division. The customization takes several months and can stretch to well over a year. After this comes staff training and the critical move from testing servers to the live system.
Considering all the pros and cons, the benefits of ERP software far outweigh the drawbacks. Once the system goes live and the kinks are sorted out, accountability and efficiency starts going up. Bottlenecks are identified and resolved quickly by managers. There is no paperwork and the entire company's data is available in one place for analytics and reports.
Consider the processes initiated when a supplier delivers goods to the company. The entry made under inventory is sent forward in real-time to all concerned divisions. The production division gets an update, and can initiate processes awaiting the arrival of goods.
The entry also reaches the accounting and finance divisions at the same time. They compare the inventory update against the vendor's invoice and documents from the procurement division, and issue payments as necessary. The system updates all this in real-time and any desk in any division causing a delay can be identified by managers keeping track of process updates.
The advantages of ERP software spanning the entire company are quite obvious. Transparency and accountability show a marked increase, and so do efficiency and quality. Everything from costing and order tracking to inventory is optimized.
With no paperwork required, every byte of data in the company can be centralized. It's a tough job to get the system operational, since the implementation team has to replicate the entire company's business processes on the system. The customization of each module has to be perfect, and so does the data flow between the modules.
But once it is done, everything that was being done physically with papers, files and phone calls can be done faster and better with ERP software. More importantly, the company's staff, management and even vendors need to be trained to use the system. It's vital to ensure that staff are not ignoring the system and doing things the old way.
ERP software implementation also takes a lot of time and is considered expensive even on an enterprise level. Migration is needed to transfer data from old systems, and the implementation has to be done by a joint team of outside consultants and the company's top managers from each division. The customization takes several months and can stretch to well over a year. After this comes staff training and the critical move from testing servers to the live system.
Considering all the pros and cons, the benefits of ERP software far outweigh the drawbacks. Once the system goes live and the kinks are sorted out, accountability and efficiency starts going up. Bottlenecks are identified and resolved quickly by managers. There is no paperwork and the entire company's data is available in one place for analytics and reports.
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