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ERP - About Enterprise Resource Planning

ERP - About Enterprise Resource Planning

Effective Enterprise Resource Planning for Your Business - ERP which is also known as Enterprise Resource Planning are systems that allow an organization to integrate internal and external management information. 

Covering all aspects of the business from accounts, manufacturing, sales and customer service management, ERP systems allow a business to automate these departments with an integrated software application.

ERP systems facilitate the ease of information flow between the various departments of a company seamlessly and manage interactions to company shareholders. ERP systems typically run from a database of information on the organizations internal network system.

The information within the organization is therefore available to access from within any of the departments. The ERP software can run from a variety of different systems and work under custom configurations on organizations hardware.

Implementing an ERP system in your organization should be thoroughly analyzed against the current requirement needs of your business and the areas and processes that require improvement. The implementation process must be a coordinated effort involving those who will be most affected from each department.

As their departmental activities become more intertwined the need to involve all employees on a company wide scale becomes more necessary. The advantages of the ERP system should be thoroughly explained so not to alienate anyone and shown how the long term benefits will work in their favor.

Today ERP is used to help businesses achieve increased profits through efficiency in a changing and rapidly competitive global market. ERP software is common in many small and medium sized companies around the world.

When using an ERP system a proper project infrastructure must be in place to facilitate easy installation and running. By having the appropriate infrastructure in place resources can be better utilized and enhance production control at the correct budget. Poor infrastructure is a common reason for failure in implementing ERP.

Poor communication between both vendor and the organization is also one of the common reported troubles of ERP software. Insufficient technical support for the organization provided by the vendor also leads to frustration with ERP systems. Deals to implementing processes, lack of real time data also show signs of a vendor who is not fit for purpose.

Selecting a reputable dealer to implement your organizations ERP systems is essential to function fully. ERP project design should be realistically attainable before installation, as unrealistic attainments will undoubtedly lead to ERP failure. This should always be backed up with sufficient training of all staff that will have access to the system.

Training costs can be substantial due to the size of the workforce being trained and their technical abilities to. A workforce that is more compliant with technical systems will require less training than a workforce that isn’t.

The inherent challenge with ERP is finding the right software solution for your organization. ERP systems can come in many different forms, due to the different kinds of business development services they are applicable too. 

There are companies that have developed ERP solutions to deal with management or human resources services that have integrated solutions designed to increase output efficiency. Helping the business to find the right people for the right available job and track current employees’ effectiveness.

ERP systems can also be employed to focus upon the financial activities of the business. This will typically deal with costing, reports and analysis of departmental budgets. These ERP systems will help with internal audits, accounting and shareholder information. Taking steps to make necessary adjustments to increase ROI.

The ERP management solutions can aid also with customer service issues by reducing problems associated with operations and production. Acting to streamline time consuming processes, CRM software applications can help improve customer relationship management.

If a business knows what it wants from an ERP system then a custom ERP solution is best. A custom ERP solution will help take care of the organizations specific requirements while managing to increase the efficiency of the organizational business unit as a whole.

There are a number of misconceptions however surrounding the building of custom ERP systems. It is widely believed that by the process of having to develop a custom software tailored to one organization specific needs that the production costs would be substantially more than choosing to implement an off the shelf software solution instead.

This is usually not the case in reality as off the shelf ERP solutions have been developed to encapsulate all ERP solutions in one almighty package to best fit the mass markets many wants and needs. 

Whereas a custom ERP is a lot smaller in size specifically crafted to need, the off the shelf solution will still require customization after purchase to fit the organizations requirements adding a second layer of cost to the overall ERP budget.

The benefits of having a custom ERP system developed are numerous, there will typically be less maintenance required to maintain it. The system will only be based upon your organizations business goals. It will only be tailored to your business and the ability for it to be changed as your business grows is substantially easier.

There are a few disadvantages also with having a custom ERP software system for your business; start-up businesses would probably find the initial costs far more for their initial outlay rather than purchasing a cheaper ERP system instead.

Most organizations would not be to receptive that the software be moulded around the employees staffed to use the software. It would be in their best interest that it worked the other way and the staff get used to the solution chosen for them as it’s far more cost effective and less time consuming.

It’s always best to assess your company with the help of an experienced ERP consultancy to find both the strengths and weakness of your organizational processes and structure. Find out if the company has poorly trained production staff or customer service advisors. 

Perhaps the accounting system in its current form requires much needed attention. There could potentially be problems in all three areas that require immediate attention. 

After having deduced where problems currently lie in the organization your consultant will be better able to recommend or develop a corresponding ERP solution.

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