Enterprise resource planning (ERP) systems allow companies to collect and manage data from different areas of the business. When using an efficient ERP system, organizations know exactly what's happening across all departments, from production to sales and marketing to supply-chain management. If things head off track even slightly, you'll know it as it happens. This leaves you in a better position to quickly make adjustments before a slight problem becomes a full-blown crisis.
The best way to unlock the full potential of your ERP system is to move from a modular ERP, which leaves some systems unintegrated, to a program that integrates all enterprise systems. When organizations make this change, they often experience a number of benefits that help the company's bottom line.
Integrating all business areas into one system allows for faster and more accurate decision-making, since relevant information is shared throughout the organization through a common dashboard. As the old business saying goes, things that are measured and made visible get done, and ERP systems measure key performance indicators and make them instantly accessible throughout the company. When red flags arise, you and your entire time will know immediately.
Leveraging big data
More data gives you the ability to make more accurate predictions and strategic future decisions about both internal functions and customers. Big data analytics and ERP work in tandem, with the latter collecting the data and the former interpreting it for your benefit. Centralizing business data also helps with another incredibly important area: data security. An ERP system allows companies to protect sensitive data through a single, consolidated security system.
Eliminating information silos
Perhaps most importantly, ERP systems eliminate islands of information — those dreaded data silos that hold back your business and people. Adding more departments into your ERP system expands the integration of the company, allowing for better decision-making while creating a more client-centric, strategic focus. As departments integrate systems, they are able to work together more efficiently and drive down costs.
For Example, an efficient and integrated ERP can help companies during their sales processes. Tracking sales data in real-time, for instance, can help make sales forecasting easier. This supports inventory optimization efforts, thus reducing your logistics costs. Everything works better when more information is available. However, a modular approach to ERP is only second-best, since it leaves potential benefits untapped. A fully integrated ERP system facilitates order tracking through all phases — from first contact with the customer through final delivery, collections and after-sales service. When this data is available in a customer relationship management system and integrated into an ERP, organizations can foster the type of seamless, high-quality experiences customers truly appreciate.
It doesn't make sense to include only some departments or systems in your modular ERP system. Customers and suppliers expect your organization to act as one cohesive unit, and with the speed of business getting faster, companies can't afford to be even half a step behind. ERP systems let you use best practices across your entire organization, and they make it easier to report and share information interdepartmentally. Going the whole way with integration maximizes your benefits and cuts down on time and money lost by maintaining legacy systems. New trends and services now offer even greater flexibility and capability in managing your enterprise systems.
Chuck Leddy is a Boston-based writer and corporate communications trainer who has written for Harvard, MIT, The Boston Globe, The Washington Post and others. He has trained CTOs, CIOs and other business executives from Fortune 1000 companies in presentation skills, negotiation and general business communications. Chuck Leddy's website is http://leddywrites.weebly.com.