5 Business Process Improvements Using Enterprise Resource Planning Software

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Making the transition from traditional management of commercial processes to enterprise resourcing planning software can be overwhelming for any business. However, it is important to understand that the profitability and growth of your business is dependent upon the quality of the processes that support it.

In short, while transitioning to an ERP suite may be an uncomfortable business move in the short-term, it will more than pay for itself in terms of development and profitability in the long-term. This list offers five examples of business process improvements that stem from implementing ERP software.

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Human Capital Management

This process handles employees as assets and can be tricky to perform in the absence of an ERP system. HCM is able to give workers a current value and project their future value based on the investment the company makes in them.

While there are separate HCM suites available, utilizing the HCM functions of an ERP suite will maximize efficiency and minimize cost. HR departments will be able to automate many of the time-consuming paperwork processes like performance evaluations and payroll. ERP solutions will also allow HR staff to manage benefits administration, compliance standards, documenting personnel actions and employee records.

One additional aspect of HCM that a quality ERP platform can exponentially improve is the process of talent management. ERP software can provide the necessary information for hiring managers to make informed, data-driven recruitment decision. Other talent management functions that ERP can improve or streamline include compensation management, performance management, development and skill assessments. For a more comprehensive list of HCM benefits, visit Gartner’s IT glossary for additional information.

Planning and Scheduling

Because ERP systems are designed to help manage and analyze data, they are excellent for improving scheduling processes. ERP reports will allow managers to see a breakdown of previous job data, as well as a history of timetables broken up by department. This functionality gives project leaders and department heads the ability to allocate appropriate manpower and streamline future operations.

Inventory Management

While most companies have an existing process for inventory management, switching over to ERP software will allow for greater flexibility and enhanced inventory management improvements. With certain forms of ERP systems, companies are able to operate on a “just-in-time” schedule that keeps inventory levels from getting too high or low.

ERP distribution software allows users to set up customized flags and notification systems to manage specific stock levels and adjust levels accordingly. It also allows businesses to see when vendors are experiencing shipping delays so they can make alternate arrangements to maintain adequate inventory.

Integrated Customer Relationship Management

Customer Relationship Management software is a completely separate suite of applications. While some CRM functions do overlap with ERP, both are necessary for a thriving business. CRM focuses on improving customer relations, while ERP focuses on streamlining business processes.

Tightly integrated CRM and ERP software can help improve business processes even more than ERP alone. Most ERP suites are designed to work in tandem with an existing CRM suite, which means businesses can use existing CRM data to improve ERP processes like sales, returns and billing.

Simplified Reporting

Reporting is a major part of every business. For companies without ERP, report generation can be a tedious, cumbersome process that consumes a lot of time and resources. Many businesses even have to build extra time into the workday to allow employees to compile and submit a daily stack of reports.

With an ERP implementation, however, the time and resource consumption drastically decreases. Most software programs simplify the process of generating and distributing reports. To reduce waste, many ERP platforms have customizable filters that allow users to create reports that contain only relevant data in a simple, spreadsheet format. This means fewer reports are required and each report will be more meaningful.

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Switching from a legacy enterprise management system to an updated suite of enterprise resourcing planning software may seem daunting, and business owners may wonder if the up-front cost is worth it. Because of this, Panorama Consulting offers a guide to make the transition to an ERP system smoother. These five processes outlined above are only a few of the many internal processes that a comprehensive ERP software system can help streamline and improve.

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