Enterprise Resource Planning or ERP is a system that incorporates internal management information with the external management information that covering the sales, accounting and finance, manufacturing and customer care. The ERP handle these organizational activities through the help of ERP software.
Enterprise Resource Planning system may be very expensive but you must also remember that implementing ERP systems is not an easy task. The concept of choosing an ERP system with the most sophisticated technology is not always correct. There are lots of extensive and quantitative evaluation to undergo before implementing ERP systems.
Though the implementation of ERP systems require large investment but once implemented, ERP software greatly helps in reducing operating costs. Since ERP enhances the coordination between the organization’s functional departments, efficiency in business is also enhanced. Through the help of these software, operating costs like production costs and marketing costs are reduced. ERP greatly enhances the coordination of users making them more efficient.
ERP software can also ease daily management. Since ERP systems ease the course of information between the different departments of the organization, it also provides better access to data store in shared databases. Through ERP systems, redundant data entry and data redundancy will be reduced. In this way, managerial control and decision making will be made easy.
The integration of different business functions of the organization can enhance work efficiency. With the use ERP systems business communication within the organization is also enhanced and problems in work synchronization will also be eliminated. The clients’ concerns will be given immediate attention and therefore results in having good relationship with the clients.
Implementation of ERP software system corresponds a cultural and technological change. Using an ERP system will change almost all business aspects of the organization. However, improper implementation of ERP systems may lead to undesirable outcome.
There are two main reasons why implementation of ERP systems fail.
First, the failure to complete the software implementation on time due to the problems in production or distribution of ERP systems. However, vendors may also contribute in implementation failure because they fail to meet what was promised on sales process.
The second reason is that the organization fail to choose the right vendor or they fail to choose to correct ERP solution. The successful implementation of ERP projects starts with extensive evaluation of software before signing the contracts and purchasing the software licenses. You have to check first the ERP system’s functional capabilities if this kind of system really fits the needs of your business.
There are lots of Enterprise Resource Planning Solution Companies that offer selections of different tools and packages which you can pick from. You can evaluate these packages according to your needs.
There are also companies that offer ERP systems at lower rate but with high performance. Making ERP software affordable is a big help for small businesses. Competition in business is getting harder and harder. To be able for small businesses to cope up with the competition, having an ERP system to assist them especially in the important organizational activities is a big advantage.