ERP Software, what it is and why it is fundamental for businesses
ERP is an acronym that stands for Enterprise Resource Planning, or enterprise resource planning, and identifies a management software that integrates all the relevant business processes and functions, such as sales, purchasing, warehouse management, of finance or accounting.
Defined by some as the “central nervous system of the company“, the ERP software collects all company activities in a single system to best support the company’s management. Thanks to the use of this tool, data from multiple parts and sectors of the company are brought together and managed in a centralized manner.
The possibilities that an ERP management system offers are truly multiple: to name just a few, there are the control of inventories, order tracking, management of customer services, of finance and of human resources. In short, ERP management software covers all the areas that can be automated and/or monitored internally within a company, allowing users belonging to the different company sectors to operate in a coherent and integrated context, regardless of the area they belong to.
Recently, ERPs have started to introduce features that exploit the immense potential of artificial intelligence and machine learning, to support you in real time in managing your business and predict how to move better in the future. With such a wealth of data and functionality at your disposal, you are able to instantly know what is happening in every business sector and at every moment, as well as the causes and origins of why this is happening. Thanks to the new capabilities of AI, management tools are now capable of autonomously analysing, learning and predicting the risks and opportunities facing the company.
Most common uses
Enterprise Resource Planning software is composed of a large variety of different modules, each of which is dedicated to a specific process or business sector. Each module, being connected to the central ERP system and having access to the information collected from all the other sectors, provides users with the data they need to best carry out their role.
Sales
The sales module allows the tracking of communications with current and potential customers, allowing salespeople to access in-depth analyzes based on the data collected to intercept new contacts with targeted promotions and opportunities. It also includes features that are distributed across the entire sales cycle, from order management to contracts, from invoicing to sales performance management, up to sales force support.
Finance
The finance and accounting module is the backbone of most ERP systems. In addition to automating financial operations, it allows the tracking of supplier accounts and customer receivables, the possibility of carrying out accounting closures efficiently, generating financial statements quickly and accurately, complying with revenue recognition rules, mitigating risk financial and much more.
Sourcing
The module dedicated to sourcing and procurement supports companies in sourcing the raw materials and services necessary to produce their goods or items to resell. In this sense, the software centralizes and automates purchases, including requests for quotes and creation of contracts. This helps you minimize over- and under-purchasing, optimize supplier negotiations through AI-supported analytics, and connect with buyer networks.
Production
The manufacturing module allows companies to simplify manufacturing processes and includes purpose-built features for material requirement planning, production scheduling, manufacturing execution, quality management and much more.
Logistics and supply chain management
The module reserved for the supply chain allows the tracking of the movements of goods and supplies along the entire supply chain, real-time management of inventories, warehouse operations, transport and logistics.
Human resources management
The HR module mainly allows you to take into account the recording of times and attendance and to calculate salaries. The capabilities it offers can also extend to workforce analytics and employee experience management, facilitating and simplifying comprehensive and ongoing HR management.
Help Center
This module allows companies to provide personalized and efficient customer service. In this sense, it can be equipped with tools suitable for internal repairs, spare parts, the management of customer interventions and revenue flows from assistance. It also provides analytical functions that help solve customer problems, strengthening customer loyalty.
The advantages of ERP
To be competitive and establish themselves in their respective sectors, whatever they may be, companies need precise and real-time information. A good management system offers multiple advantages, the main ones are:
More productivity
It allows you to reduce and automate processes, optimizing users’ work and maximizing their work productivity, doing more with fewer resources.
More agility
With instant access to real-time data, you can quickly identify new opportunities or future problems and act accordingly.
More know-how
You are supported in your operations and in choosing your strategy from a single source of reliable information, which allows you to get quick answers to business questions.
IT simplification
By choosing to integrate ERP management software into your workplace, it allows you to have a common database with which to simplify IT and make all sectors work more easily and quickly.
ERP management systems are not only useful tools for large multinational companies. ERP solutions are designed for businesses of any size, small, medium and large, and belonging to any market sector. By studying with us what your needs and the needs of your business are, we design together with you a tool that is able to offer you sector-specific functions or functions designed for the particular needs of your company, regardless of the sector in which it operates and the its dimensions.
Sources
https://www.sap.com/italy/products/erp/what-is-erp.html