Your business doesn’t need to be large to use ERP software to improve operations. Statistics suggest the global ERP software market is in demand and it will grow to about $97 million by 2024. What’s more, it’s not just enterprises of 1000+ employees implementing the software. The “enterprise” in ERP denotes company-wide, not the size of the business using it. Therefore in this business blog, we delve into the world of an ERP and its core components.
Why an ERP?
A typical business has many organizational areas, including Marketing & Sales, Accounting & Finance, IT, HR, Customer Service, Supply Chain,
Manufacturing, Purchasing. An ERP integrates processes from various departments into one application, one centralized database and one user interface. Leveraging an ERP automates tasks and workflow processing between teams and departments.
The ERP system helps create a coherent ecosystem, whereas all its components can function separately within the centralized software. This is where enterprise website development is required over standard product development. Enterprise web development has three core focuses – front-end, back-end and database integration. Organizations often require customization of components to enable significant work improvements across the entire organization.
Some of the technologies used in enterprise web development include React.js, Angular, and Vue.js.
Let’s consider the critical ERP components from a business perspective of how ERP software works and what functionality it covers.
The main task of the inventory management component is production optimization and distribution planning. It helps manage the material purchasing process, order fulfillment, and warehouse stocking. It commonly includes tracking functionality to eliminate manual inventory management. There is no need to do such tasks manually, as all the required data will be updated automatically across needed channels.
Supply Chain Management
The highly organized supply chain brings lots of advantages for businesses. For example, it focuses on increasing efficiency, lowering process delays, and saving costs. This component embraces such areas as order fulfillment, logistics, and warehousing. Real-time tracking keeps all departments informed about the order status, delivery, items in stock. Also, automatic reporting enables complete control of product movements inside and outside the organization.
Managing financial aspects often becomes quite a complicated task for businesses. Therefore it involves the management of all the transactions, cash flows, and financial operations. ERP accounting component covers all the essential needs – billing processes, transaction completion, product cost, and payroll management. Besides, it deals with taxation and documentation in compliance with valid regulations.
Streamlining business processes isn’t possible without efficiently processing documents and records. The enterprise content management component can provide the organization with many helpful tools to deal with tons of data. It is excellent for managing organizational records and files. Moreover, it often supports the opportunity to convert, transmit and report essential data. This component can keep order in document workflows.
It’s hard to imagine some business without leveraging the Customer Relationship Management (CRM) tool. Compared with regular CRM software, the component remains fully integrated into the ERP system. It includes all the necessary functions like customer management, interaction tracking, lead management, reporting. Also, gathered data provides comprehensive insights for improving marketing processes and increasing sales.
ERP software is a brilliant tool that generates tons of well-structured data at its core. It provides valuable insights into improving business workflows and processes. The main component objective is to support data-driven decision-making by presenting a clear view of business activities. As a result, it allows the company to set realistic expectations and take positive steps in advancing its products and services.
It’s essential to add the separate ERP component for staff management. It provides all the necessary tools to automate, regulate and centralize data on every employee. Starting from the details from recruitment to others like working hours, assigned tasks, sick, leave, etc. Besides data storage, good staff management involves sharing it with other departments. For example, sharing this data with the accounting department helps manage payrolls.
The functionality of ERP software is vast and dependent on company-specific needs. As long as the company decides to leverage the ERP system, they take the unique opportunity to boost performance and profitability. Along with defining their business needs, they can choose the required components. Since ERP software is always a flexible and scalable solution, it won’t be hard to add new parts when needed.
Every company can implement and leverage an ERP, using the components relevant to the business needs. If your business is yet to make the leap consider an ERP and reap the rewards of automating business processes, improving communication, productivity and efficiencies across every department.