5 Key Benefits of ERP & Best Practices for Implementation
k-ecommerce
Like any other type of complex system, your business is a collection of various components each performing a specific function. You have your finance department, your HR team, your supply chain, your customer relationship management systems, and many more. These elements all have their unique roles and responsibilities, and without any of them your operations will fall apart. However, despite the fact that each element of your business has its own focus, they can’t work independently from each other. There needs to be something tying them all together and ensuring they can communicate and collaborate as effectively and efficiently as possible.
This is where enterprise resource planning (ERP) systems have become so important in the modern business landscape. An ERP system is what prevents departments from becoming siloed, creating a centralized network that keeps them all connected and aware of what they’re all doing. It’s the one database to rule them all — the brains of your operation.
Without an ERP helping you organize your business’ data and maintaining a steady stream of communication between all departments, your company can become bogged down in inefficiencies. All your disconnected systems and databases can result in your left hand not knowing what your right hand is doing, resulting in confusion and chaos that can be difficult to overcome. Taking all this into account, why is it necessary to have an ERP today? What benefits can it provide for your business? How should you go about implementing an ERP system into your existing operations? The answers to these questions can lead to big improvements for your company.
5 Benefits for Maximizing Business Efficiency and Growth
By connecting all your disparate departments together under a singular framework for sharing and accessing data, an ERP system has the potential to transform your business. It gives you the infrastructure you need to ensure every aspect of your company is working together as intended with maximum operational efficiency, so you’ll be prepared for whatever you encounter. Here are five of the most important benefits of ERP software to enhance your company and prepare it for growth.
1. Improving Efficiency and Productivity Through Process Automation
Given how much information your company processes in a given day, anything that can streamline your operations can be a welcome addition. ERP systems come with powerful process automation capabilities that can take much of the burden of data handling and processing off your employees’ shoulders.
For example, because information generated by multiple departments is collected and maintained within the ERP system, employees can find specific details with a quick search. This means they won’t have to spend a lot of time and effort trying to track down the specifics of what they need from other departments. All the details they want will be readily available and accessible for them.
With the time saved through process automation, your employees will be free to focus their efforts and attention on more-important tasks. You also will be able to keep your overhead lower because certain aspects of your business will be less labor-intensive. It all adds up to increased productivity and efficiency throughout your operations, which leads to bigger and better things into the future.
2. Enhanced Data Accuracy and Real-Time Insights for Smarter Decision-Making
One of the biggest challenges companies face when they don’t work with an ERP system is dealing with discrepancies in their data. With departments effectively walled off from each other, there’s too much risk of multiple datasets that may be in incompatible formats or even featuring incorrect data. The result is one department potentially working on incomplete or outdated information, with the real answers being hidden away in an obscure spreadsheet.
Having an ERP system in place effectively eliminates this risk by providing a centralized repository for all your business’ data. This means it is instantly accessible by anyone within your organization who needs to see it, in standardized formats that ensure everyone can use it in the same ways. Because the information contained within the ERP is updated in real-time, everyone will have up-to-the-minute insights they can use to make the most-informed decisions. This not only streamlines the decision-making process, but also ensures your company will be as agile and responsive as possible whenever conditions change.
3. Better Collaboration and Communication Across Departments
When your company’s departments are isolated from each other, it can hurt you in numerous ways. You run the risk of falling prey to miscommunications, wasted effort and missed opportunities. This is why having an ERP system to break down silos and bring everyone together on the same page can be so important. It means everyone uses the same applications and datasets to get their work done, which enables collaboration and cooperation among coworkers.
An ERP provides a common resource everyone can use to share information and contribute. Because all your teams are aware of what the others are doing and how it impacts them, you’ll see improvements in terms of productivity and communication almost immediately.
4. Cost Savings and Optimized Resource Management
Thanks to its automated processes and time-saving collaborative functions, an ERP software platform can cut a lot of waste out of your company’s operations. Your teams will spend less time completing the same tedious tasks, which means a reduction in your operating costs. The enhanced opportunities for collaboration also give your company new ways to work together and find efficiencies that they may not have been able to identify on their own.
Another benefit of providing your entire company with real-time visibility into your inventory levels and other metrics is optimized utilization of all your resources. With a complete understanding of where everything stands, your company will be able to allocate resources in the most efficient manner and prevent waste from impacting your capabilities.
5. Scalability and Flexibility for Business Growth
ERP software is designed to keep all the various aspects of your business together and mesh them successfully no matter how large your needs become. One of the many advantages of a centralized resource for all your business data and resources is how it can future-proof your business against the added demands as your company grows.
It’s easy to add new users to a cloud ERP system, as well as new capabilities. Having an ERP software platform as the foundation of your operations means you’ll never be left scrambling to upgrade or update your processes in response to change. You’ll always be ready to continue with business as usual even as your operations scale up and new people come into the organization.
Understanding ERP Integration Strategies
Once you understand all the advantages an ERP system can bring to your business, the next step is planning your integration. Due to the sheer scale of the functionalities ERP systems handle, this is far from a plug-and-play installation. Because an ERP platform touches virtually every aspect of your business, the implementation should be handled with care and a significant amount of planning to ensure the best overall results. Although each business has its own unique set of needs and circumstances, there is a general framework that a successful ERP implementation should adhere to in most cases:
- Creating an ERP project team — This should bring together representatives from all departments. The objective of the team will be to determine which platform makes the most sense for the company’s needs and discuss the implementation process so it goes as smoothly as possible for every department.
- Developing a change management plan — Moving from your legacy processes to the new ERP-powered reality will take a lot of forethought and support. You should think about what you expect your specific pain points may be during the implementation and be prepared to help your team cope with the changes as effectively as they can.
- Determining the project budget — If your ERP implementation ends up costing you more than you expected, it can put you in a hole that will make it harder to realize the benefits of the system on schedule. This is what makes establishing a budget and performing due diligence to understand the costs of an ERP system so necessary.
- Migrating your data — Garbage in, garbage out, as the saying goes. This is the time to perform a comprehensive data hygiene assessment so you know for sure the information you’re importing into your new ERP system will be accurate and clean.
- Training your staff — Unless everyone within your organization understands and is comfortable with your ERP platform, there’s no way to realize all the benefits it could be providing. You need to provide your employees with all the resources they need so they can hit the ground running as soon as the implementation is complete.
- Preparing to go live — In the lead-up to the big day, there are a lot of steps you should take to make sure you’re ready. These include system testing, performing network reliability tests, scheduling IT staff to provide support and determining the metrics for measuring the success of your implementation.
After you turn the key and start using your new ERP platform, it’s a good idea to take stock after about a month or so to gauge how well your efforts have gone. Some of the most common metrics companies use to determine the success their ERP transition include any changes in productivity levels, reduction in instances of human error and increases in reported customer satisfaction rates.
ERP Customization or Standardization?
One of the key considerations when implementing an ERP system is whether to stick with the standardized configuration or to customize it. If you decide to retain the standard features, you may need to reconfigure your processes and protocols to match them. This may result in a bit of an awkward transition period as you work to reshape your business to fit around the ERP as closely as possible.
On the other hand, customizing the ERP system could result in a lengthy and costly process that could stretch on much longer than you originally expected. This may lead to a reduction in ROI as well as delays in when you begin to see any results from your efforts. Before you get too deep into the weeds with your ERP implementation, you need to think carefully about how good of a fit the system is with your operations, and vice versa.
How ERP Can Help Smaller Businesses
Although it may seem as though ERP systems are best suited for large-scale enterprises, the truth is that even small companies can leverage this software to their advantage. The key is understanding how the needs of smaller businesses differ from larger ones.
Because small companies typically have fewer resources, they need to be more judicious in how they implement an ERP. This usually means going for a modular approach that gives them a core set of essential functions at first that can be expanded as the company grows and its needs evolve. Choosing a cloud-based ERP solution that offers greater flexibility and lower costs is another way small companies can get their feet wet without overcommitting themselves.
Work With k-ecommerce to Get More from Your ERP
Once you’ve selected the right ERP system and integrated it into your operations, the next step is finding the best ways to put it to use. When it comes to B2B ecommerce, k-ecommerce provides an ERP-integrated solution that unifies your online and back-office processes to drive growth. Our software integrates with your ERP to streamline and simplify your ecommerce presence so your customers have a smooth and seamless experience whenever they do business with you.
If you’d like to learn more about k-ecommerce and how it provides exceptional ERP integration, reach out and talk to one of our representatives to schedule a demo today.