Modern e-commerce brands have access to more data than ever before.
There are numerous ways to put this data to good use, and leaders have a responsibility to explore as many approaches as possible. Each method offers unique opportunities to gain a competitive advantage and increase profits—from supply chain improvements to new revenue streams to forecasting market demand.
A key way to bundle this data and evaluate it meaningfully is to use Enterprise Resource Planning (ERP).
In this article, you will learn the basics of ERP, the best ERP solutions, and how to choose the right ERP system for your business.
What is ERP?
Enterprise Resource Planning (ERP) refers to the software and systems a company uses to manage core business processes. It collects data from various departments such as supply chain, sales, human resources, production, malaysia email list procurement, accounting and project management.
Table of contents
- How does ERP work?
- What is an ERP system?
- Advantages of ERP
- Three types of ERP
- Choosing the right ERP system
- Best ERP software solutions
- risks of ERP
How does ERP work?
ERP originated in the 1960s as material requirements planning (MRP) systems. Manufacturers used MRP software to plan, schedule, how to prepare a company for new obligations? and manage inventory in the manufacturing process. Twenty years later, vendors developed an enhanced manufacturing resource planning (MRP-II) system that offered new ways to centralize information and streamline processes such as scheduling, inventory management, and cost control in manufacturing.
The idea behind ERP is to help larger companies become more agile and efficient, as well as make data-driven decisions that lead to better business results. The data collected in an ERP system is often presented in a dashboard that decision makers can use to monitor and manage their business in real time.
These systems are constantly evolving to incorporate new technologies and support a variety of functions, denmark business directory but the goal remains the same: to improve business processes and increase profitability.
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What is an ERP system?
An ERP system brings all of this data together in a common database so that stakeholders can define company-wide baselines, find benchmarks, and set goals for the future. This is done through ERP integrations that enable the flow of information between different software solutions so that they can be used in a uniform manner.
But what motivates a company to implement an enterprise resource planning system? Almost all ( 94 % ) companies say that timely innovation is important – and ERP can help with this.
Other common reasons are:
- improving business performance
- positioning the company for growth
- reduction of working capital
- Better customer service
- Making work easier for employees
In a recent survey by Shopify and IDC, 28% of companies have already achieved significant benefits, such as improved customer experience and faster time to market, by deeply integrating a SaaS commerce platform into their business.
Advantages of ERP
Think of your company’s operations like the parts of an engine. Being able to look under the hood while the engine is running can be invaluable in determining whether preventative maintenance is needed, whether an immediate repair is necessary, or whether everything is fine and operations can continue.
ERP software provides a centralized data system that every company needs. Around 73% of companies consider it very or extremely important to break down data silos and improve internal communication and collaboration. An ERP system integration can help your company achieve this goal.
An ERP software system can help companies save costs by:
- IT costs controlled
- Financial transparency offers
- Secures all company data in one place
- Creates a central location for analyses and reports
- More accurate tracking of inventory and sales facilitates
- Optimized collaboration between employees from different departments
- Improved customer service
- Increases supply chain efficiency
- Enables smarter business insights
ERP helps create a single, trusted source of truth for your business. This means you get real-time insights in one place, allowing you to identify patterns and predict trends that wouldn’t be possible without ERP.
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Three types of ERP
The right ERP can help you increase productivity and improve the personalization of the customer experience. However, not all ERP systems are the same. There are three different types you should know about – especially if you’re new to ERP.