What is ERP system?
ERP software’s are helping people all around the world in managing their business. So what is ERP? Is it a magical tool that can be used to make profit from any kind of business? Well sadly the answer is no, you still need a good product to earn profit but what ERP system can do is increase the efficiency of your business and we all know more efficiency means more profit. ERP stands for enterprise resource planning, well you know now what ERP stands for. Now let’s define ‘what are the features of ERP system?’ All business have different systems, like financials to watch the accounts, production to watch productivity, inventory to keep tracks of your supplies, sales to keep in bringing the customers, services to look into your customer needs and purchasing to shop for your product, now data of some of these systems are needed for the functioning of other systems. Like data of sales system can be needed for production system which can be needed for finance. Various interfaces are used to transfer data from sales to manufacturing and than from manufacturing to financial. This can reduce the efficiency of the company and can cause data loss too.
What does ERP software do?
The function of ERP is to create a common database serving in multiple functional areas so whenever data of one system is needed for other it can be attained easily. An ERP system seeks to streamline business operations by integrating the data and refining the processes required to operate an organization. ERP is a business solution software that integrates and automates the data management of a company’s business processes.
So now that we have accomplished a basic understanding of what ERP is, let’s talk about the basic features of an ERP or what an ERP is supposed to do.
Features of ERP system:
An ERP system integrates data and processes across multiple departments and locations, it allows a company to move product faster, process orders quicker, invoice customers more rapidly and reconcile shipments sooner so ERP will increase the productivity.
Information is the base in any company. You need accurate information as fast as possible. This information was either unavailable or difficult to obtain with other systems. ERP systems give companies access to a multitude of company information because of integration of database. Also this information is accurate as it comes from a single source.
This integration also allows a company to use the same system across multiple geographies. A company can have different departments at different regions far away from each other but can still function without any trouble as due to the integrated system they all see the same data. The ERP system eliminates the need for storing redundant data in multiple physical locations.
So now we know what ERP is and what are the features of ERP system. But the question that still remains is,does business need ERP? It depends on the kind of organization. If the organization is small than providing a single data base makes no sense as transfer of data in a small organization is easy even without ERP. But in a medium size or big organization use of ERP is suggested, as transfer of data from one department to other is necessary for proper functioning of the organization and without ERP, it takes a lot of time leading to delay in production and distribution which can give a fatal blow to the organization in today’s competitive market.