Article 7 – Advantages of ERP

In my earlier article we have seen ERP basics, now we will take a deep dive and learn Advantages of ERP.
Advantages of ERP :-

  • WFH (Work From Home) is possible as system is accessible access the systems from their home.
  • Better accuracy and availability of information
  • Automatic Reconciliation of Data
  • Improved Efficiency
  • Improved Quality
  • Improved workflows
  • Standardised Business Processes
  • Improved Supply Chain management
  • Superior Scalability
  • Improved & Precise Planning
  • Enhanced Reports

Main advantage of ERP is you can access the systems from their home. For that you should have cloud ERP. So in this new normal WFH (Work From Home culture) in this pandemic your work will not stop. This is the greatest benefit of ERP in this different and difficult situation.
As data entered in system will be validated by approver and will be visible to other departments. It will improve your accuracy as well as availability of information.
All your disorganized process flows/ workflows will be automatically streamlined. Process flow means steps that should be followed to complete any process like procurement. For example, to complete the process of procuring raw material in any Manufacturing company is
1) Create Production Plan in advance before starting of the month / before new production schedule – [ Production Department]
2) Check Inventory – [ Store Department]
3) Create PO(Purchase Order) depending on inventory and Lead time (Lead time means time require to reach the raw material in our warehouse. This time depends on lot of factors like travel time etc.)
If all above processes are driven by Excel Sheets then there are chances that above mentioned workflows may or may not be followed.
There are many reasons for that like Live Inventory status is not there with Production Department. Live and updated Production Plan is not circulated with Store department so they are not ready with raw materials. Procure Department is not aware of the production schedule and live inventory updates so this causes delay in raising PO. This causes last minute raw material purchase for higher rates, compromise on raw material quality, production planning goes for a toss which causes overall mess and impact production capacity as well as production quality of the product.
All these can be easily managed by ERP as all these departments are interlinked so data flows from one to other and make the process super easy and error proof. In ERP you can not deviate or omit IMPORTANT processes so everything goes as per plan. So Plan -> Procure is easy. This will improve your Product Quality, efficiency, workflows, planning and also standardised your workflows for better results.

You can analyse your data using reports, or pictorial representation like pie charts. These reports play very important role in visualising where we are lacking and which process needs improvement and helps to take decisions to achieve your goal.
I will discuss about some myths and try to decode those myths. 🙂

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