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Customer services failing, difficulty with financial reconciliations, trouble with tracking sales order and keeping up with all the latest technology – are these scenarios too familiar? Then it is time to think of setting up an ERP system for your company.
Of course every organization is built entirely unique from each other and as such, ERP system might not work out for you and no key indicators can ever help one determine if it will solve the problems the company is facing 100%. Whilst that said, there are some situations and problems that are common among businesses or organizations and if the business is facing these problems, then ERP can be among the solutions your company might need. Below are some signs that would help you identify if ERP would work.
The first thing to do is to identify the software platform that different departments use. Does the sales department make use of exclusive software that another department cannot use? Does the distribution use an entirely different platform to track receivables and shipping and connecting various departments can be a pain? If each department makes use of different software, chances are, the transaction process can be stifling and the process from sales data to inventory to budgeting can lead to a management nightmare.
Using a single software system such as the ERP can help the company by providing a single database where all information is stored and easily accessible to different departments. By using a single source of information, employees would be able to make informed decisions and eliminate time wastage in implementing these decisions helping the company to grow its business faster.
With the ERP solution, managers and those who need data can access the information without relying on manual updates of the company’s sales and performance. The system allows the company to reconcile data in an efficient manner thus allowing sales personnel, for example, to review a client’s purchase history and thus be able to upsell or cross sell items to their company.
One of the key signs that the company is heading into trouble is when the accounting department is providing delayed data or information. Oftentimes, too much manual paperwork can make the company’s data lag and critical information is lost in the process. By manually entering information and cross posting it with other data, too much time is being wasted. With the ERP system, consolidation of accounts payables and receivables are made easier and since all are logged into a single database, it is easier for the department to cross check posting information freeing them up to provide important and updated information in a timely and efficient manner.
One of the biggest challenges that expanding companies experience happens to be inventory management. As timing is an important key factor to the success of the company, tracking and ensuring goods and products arrive on time are essential and a vital part of any company’s success.
When data or information is held in a separate location, it can pose a risk and serious problems may crop up in the process. For example, if the sales personnel will not be able to determine the availability of stocks, it won’t be able to sell and thus making the sales of the company suffer. This is the same case when the department is restricted from determining if stocks are delivered or already shipped to the client. In the end, the company will earn the reputation of being unreliable and poor service resulting to a poor customer experience.
Integrating an ERP system to the company’s core system will enable each department to access real time data or information thus customer sales will be able to provide up to the minute information to clients without having to put the clients on hold. In some instances, customers will be able to access the information as well and determine if their orders are delivered or in transit. The warehouse department meanwhile would be able to check the stocks and order the necessary stocks without having to do a manual inventory.
The top sign to look for is when the IT department expenses are becoming more prohibitive. As managing different systems can be costly with constant upgrade of software, patches and integrating them to the system, this can eat up the company’s financial resources. Legacy business software for example are highly expensive and updates can be costly and time consuming not to mention the fact that any customization will be worked on by the IT team and would require the computers to be pulled out for maintenance.
With the ERP software, the IT department can do any upgrade online and with cloud based services, system updates are done remotely and new features are integrated to the computer without any problem.