An ERP system manages business information by integrating data across functional groups within an organization. Modern manufacturing ERP systems offer numerous benefits because linking your organization increases efficiency and quality, lowers costs, and provides greater organizational flexibility and decision support. Who benefits from ERP? Let’s look at how various departments can tap into the potential of ERP.
Who Benefits from ERP?
It’s easier to provide high-quality customer service using an ERP system. Customer service agents can interact with customers and improve relationships with them because they have quick access to accurate customer information. The real-time data and integration features of an ERP system allow Customer Service teams to determine product availability and provide accurate shipping and delivery information to customers. Because of this, customer service improves because agents can quickly answer order questions and provide important information to customers about their orders.
Many companies reap huge benefits when they implement an ERP system that automates and integrates their accounting functions. For example, accounts payable invoices are created, matched and paid automatically within the ERP system. Automating these functions eliminates data entry mistakes, making data more accurate, and frees up staff to work on other tasks. This saves a tremendous amount of time and money. Financial decisions can be made with confidence because they are based on accurate, timely data.
With an ERP system in place, Purchasing can create accurate purchasing plans and delivery schedules, ensuring the right quantities of materials and subassemblies are on-hand to complete orders on time. Today’s ERP systems allows Purchasing departments to communicate with their supply base via Electronic Data Interchange (EDI), providing timely and accurate material and component requirements to suppliers and receiving updates on any potential delivery/lead-time constraints. The result is a supply chain that runs more smoothly and creates efficiencies across the chain.
A modern ERP system brings a new level of productivity on the shop floor. Increased visibility into production and scheduling allows Production Planning to respond to demand, create and schedule jobs, and easily determine if materials are available. Raw materials and components are received at the appropriate times because Purchasing runs more smoothly. The ERP system records production as it happens, creating and tracking Work in Process (WIP), while depleting raw materials and component inventory in real time. The ERP system creates production and labor records, along with quality data records to ensure standards are met. Having the right people with the right parts in the right place at the right time dramatically improves productivity.
Perhaps the greatest impact a modern ERP solution can have is with a company’s C-Suite. The integration of business functions improves information flow and results in better decision making. This creates synergy within a company as groups work more efficiently using accurate data. Improved communication between areas such as Sales, Production Planning, Scheduling, Purchasing and Finance allows an organization to respond quickly to changes and capitalize on new opportunities.
ERP also allows companies to eliminate many processes that do not add value to their business. Resources are focused on improving the bottom line. An ERP system introduces fundamental innovations in managing resources, which eliminates delays and reduces operating costs. In fact, the information generated and shared in the ERP system provides a distinct competitive advantage by reducing costs across the organization. For example, materials and inventory costs are reduced through increased inventory accuracy. Manufacturing costs are reduced through planning and scheduling efficiencies that result in fewer setups and fewer change overs.
All of these benefits and savings create a more nimble, responsive company. Senior management is able to take advantage of growth opportunities and lead the business in a positive direction.
We hope you enjoyed our blog on, “Who Benefits from ERP?” To learn more about Enterprise Resource Planning (ERP), read our blog, “3 Big Benefits of Modern ERP.”
Our highly-skilled ERP consultants have been working with manufacturers for over 20 years to help them maximize the value of their ERP systems. If you would like to find out why Revolution Group is a trusted ERP consulting partner, give us a call at 614-212-1111 or fill out the form below. We would love to change the way you think about ERP.