ERP can be a complex term and it can be difficult to implement as well. But if the wind blows in the right direction, then ERP system can reap higher benefits than the investment cost. Yes, it’s true that ERP systems tend to get under-utilized because of the complexity factor associated with it. Let’s discuss about the business values associated with an ERP system and how it can be an integral part of the organization.
First of all, it is essential to understand the designing structure of an ERP system and the reason behind implementing the same.
What exactly is an ERP?
While many are of opinion that ERP is a modern technology to improve the business process in an organization, the actual scenario is something more than that. It is more than just a mere technology although most of the vendors and businesses have a tendency to address it as a software system. Walk down the lane of history, and you will learn that the concept of ERP was actually developed to deal with the Supply Chain system of an organization. ERP was developed as a set of practices and policies to make things happen on a positive note forthe SCM. However, with the passing of time, the meaning of ERP has been shifted primarily to the software sector.
Look at the full form of ERP software; it stands as Enterprise Resource Planning. Where the hell a software solution does comes into? It is entirely about planning to make the resources associated with the enterprise reap positive results. This planning is done not manually but through the help of software solutions designed on the principle of ERP. However, many people don’t understand the concept and keeps addressing it as some kind of software product.
Areas ERP focuses At
ERP software suites are not designed only for addressing operations and sales planning. There are other areas that it addresses like Supply Chain, Finance and Accounts, Materials Management, Inventory Control, Product Scheduling, and Purchasing.
It is essential to understand the areas and functionality of an ERP system. Unless you have clear understanding about the areas this software suit specializes at, the entire business process will come under severe jeopardy. It is not possible for an ERP system to solve all the business related problems by itself. You need to take the initiative to integrate it with different improved business processes to get the best out from the system.