What is Enterprise Resource Planning (ERP)?
A business can consist of several core processes which are essential to run it successfully. These processes may include HR, Manufacturing, Finance, Administration, Sales, Marketing and many more.
ERPs can be understood as software which integrates all of these core business functions on one platform. With the advancements in technology and consumer demand, the latest ERPs are easily customizable. These applications can also focus on business functions individually. The role of ERPs is to offer end – to – end visibility, efficiency, and intelligence with respect processes and functions to business owners. Subsequently, leaders are provided with the power to make informed business decisions.
Over time, ERPs have evolved from physical client-server variants to cloud-based variants for offering web-based access to users operating from distinctive locations.
Why do Manufacturing Businesses Require ERP?
Due to the growing competition as well as the dynamic nature of the Manufacturing Industry, owners are stringently focusing on streamlining their business processes. Their main goal remains to implement an integrated solution that can accelerate productivity, reduce costs, increase revenue, adhere to timelines and most significantly make precise, informed and strategic decisions in favor of the business. ERP can help organizations in becoming self – aware by interlinking all the processes within one another. Information can be shared across departments and individuals by just clicking buttons.
ERPs can additionally help in cutting cost across functions as well as departments by eliminating the implementation of other expensive, duplicate as well as incompatible resources and technologies.
What are the benefits of ERP for Manufacturing Businesses?
ERPs can spur the growth of businesses and address several challenges such as eliminating silos between departments. Besides those, there are numerous other invaluable gains that ERP offers to businesses. The top-of-line are discussed as follows:
1. Making Informed and Strategic Decisions in favor of the business
ERPs are insightful tools which offer leaders with full visibility of every function, department as well as a process. Additionally, it also offers them with performance related stats such as overall sales prospects, total lead conversions, etc. Quicker approvals can be shared or sought based on past records. Availability of such a vast amount of information makes it easier for employees to take swift and favorable decisions for the business.
2. Reduction of Business Related Costs
ERP software also helps manufacturing businesses by diminishing the operational expenses by alternating streamlined, automated processes with manual and time – consuming ones. Since the data being generated with the help of ERPs is precise; the bottom line improves allowing more revenue to flow in. Excess storage and warehousing costs can be eliminated entirely as the inventory details are accurately tracked with the help of production and planning tools. Management can save money and make deductions in budget wherever necessary owing to 360-degree visibility.
3. Streamlining business functions and processes
With growth, the processes of a manufacturing business are likely to turn more complicated. ERP software can help in automating these processes and generating real-time information. It also helps in eliminating duplicate data entries, expediting actions and interlinking functions with one another. For instance – orders can be completed quickly, and deliveries can be made on – time given the information of inventory, storage, and finished goods are readily available. Approvals for leaves or manpower requisition can be sought with just one click.
4. Improving Customer Fulfillment
Accurate planning and control related to production, real-time information of storage and inventory, aligned processes, synchronized distribution channels allow manufacturing to deliver on-time and in-full quantity to businesses. These applications can also be used to record customer demands along with product and service feedback to improve their experience.
5. Complete Visibility of Supply Chain
This one benefit cannot certainly be weighed down. To avail all the above – mentioned benefits, it is important for a manufacturing business owner to have end – to – end visibility of his supply chain. ERP software is the best tools to offer that. You can hand-pick the bottlenecks in functions and eliminate them with the help of the information being generated through ERPs.
ERPs are important tools, to sum up, all the business functions and give a real update to the owners regarding the performance of the business. Especially for manufacturing businesses, with no time, resources and money to waste, ERPs prove to be integral tools for ensuring success and edge in the industry.