Enterprise resource planning software (ERP) isn’t one of those things business owners lie awake at night dreaming about. However, integrating the right ERP solution into your organization could provide a long list of benefits and perks that ultimately enable you to accomplish your goals.
What is ERP Software?
ERP software has been around for a while. And though it’s traditionally been something that larger organizations use, new technology and innovation have made it a practical choice for smaller businesses over the past several years.
According to FInancial Force, “Enterprise resource planning (ERP) refers to a solution that streamlines the ‘back office’ processes you use in your business such as accounting and financial reporting, project management, billing, HR, and supply chain operations. The primary goal of an ERP is to optimize and automate these processes to boost operational efficiency and company profitability.”
Some ERP solutions are designed to address very specific processes or functions (accounting, for example), while others are designed for specific industries or vertices (like healthcare). Common ERP functions include:
- Accounting and financial management
- Order and inventory management
- Human resource management
- Governance, risk, and compliance
- Supply chain management
- Project management
- Analytics and reporting
The Big Benefits of ERP Software
ERP software can handle almost any task that arises in your back office. It can save you thousands of hours per year and yield a host of other benefits. These benefits include:
1. Better Security
One of the unsung benefits of ERP is better data and cloud security. With the right solution, you can deploy dedicated security resources to key areas of the business and reduce the risk of both internal and external threats. And because everything is in the cloud, there’s less risk of crippling data loss.
2. Enhanced Reporting
Say goodbye to limited data and analytics. With ERP, you get enhanced business reporting that can be used to drive accurate decisions.
ERP gives you a “single source of truth,” which is basically a fully integrated database that collects and analyzes all business processes. Best of all, the information is analyzed in real-time, which makes it easier to be proactive.
3. Cost Savings
One of the natural byproducts of these other benefits is an increase in cost savings. This is the direct result of improved inventory planning, superior procurement management, and improved relationships with vendors, customers, and all company stakeholders.
4. Greater Transparency
“Transparency” seems to be the word of the decade for businesses. It’s no longer considered good practice for businesses to limit visibility or create departmental silos. Instead, companies are finding it beneficial to establish enterprise-wide transparency.
ERP software lets companies build predictability into their processes and make more accurate projections. This results in more confident and intelligent decision making. No longer is one department left guessing what the other is doing. Total integration means all aspects of the business work together to achieve underlying business goals.
5. Better Customer Service
On average, a business loses half of its customers every five years. When you pause to think about it, that’s a pretty sobering statistic. It speaks to the importance of good customer service and the need to develop positive inroads with customers.
When used properly, an ERP solution can streamline shipping, enhance supplier relationships, and accurately match supply with demand (to ensure customers always have access to the products they need). The end result is happier customers who trust your business.
6. Stronger Sense of Cohesiveness
At the end of the day, incorporating the proper ERP solution into your business will result in a stronger sense of cohesiveness throughout the entire company.
As Investopedia explains, “Integrating and automating business processes eliminates redundancies, improves accuracy, and improves productivity. Departments with interconnected processes can now synchronize work to achieve faster and better outcomes.”
It’s difficult to quantify what cohesiveness means to a business, but once you have it, you’ll know. ERP is just one tool you can use to bring your team together.
Give Your Business the Boost it Needs
Your company’s success is a direct reflection of the health and efficiency of your back office. If your back office is chaotic and disheveled, your business will reflect that. If, on the other hand, it’s organized and systematic, success will soon follow. Now’s the time to address your back office and give your business the boost it needs.