What is the importance of ERP

What is ERP

What are the advantages and disadvantages of an ERP system?

Regardless of whether it is a standardized or an individual solution, the introduction of an ERP system is beneficial numerous advantages always one some risk with himself. The costs or an unplanned long implementation phase are often underestimated. Therefore, entrepreneurs often shy away from integrating an ERP software. But if you take a closer look at the benefits that an ERP system has, there are numerous advantages that have a long-term positive effect on the success of the entire company.

ERP systems offer many advantages

Nowadays it is no longer just important for companies to deliver first-class quality, but above all React on the market at lightning speed to be able to. With the integration of a corresponding business solution, companies can react more quickly to general demand and to changing market situations.

  • Simplification and automated control through a central data system
  • Increase in efficiency and productivity
  • Clear distribution of tasks and functions
  • Faster exchange of data and information
  • Short response time for inquiries and tenders
  • Great competitive advantage over competing providers
  • Adaptability to changed market situations
  • Process security and transparency
  • Quick access on key figures and evaluations
  • Networking of the entire company (including branches and subsidiaries)

This results in additional advantages for the individual departments of the company:

  • Optimal control and planning of resources such as personnel and materials
  • Clarity and transparency of in-house business processes
  • flexibility in the event of a changed market situation, new trends and customer needs
  • Global competitiveness in terms of price, quality and speed
  • simplification internal processes and collaboration for all departments
  • overview about business development

Thanks to an ERP system, there is also a certain amount automation for almost all business processes and workflows, which also has a positive effect on costs and processing time. By using ERP, companies also have the opportunity to use their Lead times to decrease the flow of information to improve internally and to plan together with foresight.

Simplified processes and automation thanks to ERP

By using ERP software, all of the company's business processes are automatically mapped, resulting in a automated handling of daily tasks leads. This saves all departments time and enables them to work faster and more effectively. For example, customer orders can be processed more quickly, which in turn means more capacity for new orders.

The automation of the workflow also reduces the error rate, which is particularly true of the Customer satisfaction benefits. With an ERP system that is individually tailored to your company, you can concentrate on your core business again and work on future success.

ERP software as the central database

With an ERP system you do without complicated and cumbersome isolated solutions in the form of different IT software. The ERP software networks all departments and processes into one unified system, which provides the staff in all areas with the same level of information. The double recording of data is thus virtually impossible. The maintenance and transfer of information is also quick and easy.

Disadvantages due to the integration of an ERP system

Not only are ERP systems attractive to many companies because of their numerous advantages, they can also have a number of disadvantages. Before implementing an ERP system across the company, in particular, you should think carefully about the Requirements and the required functions do. It is easy to misjudge yourself and unplanned costs arise, which can be particularly damaging to smaller companies.

Disadvantages at a glance

  • High costs due to an unplanned effort due to the system implementation
  • Choosing one unfriendly System that causes problems and demotivation among employees
  • Increased Cost factor regarding customization, maintenance and regular training
  • Possible problem with integration from other systems (e.g. CRM)
  • Addiction from a specific manufacturer

You certainly run a certain risk when choosing the right ERP system. However, since there are no really good alternatives that serve the same purpose for your company, the use of an ERP system is usually the better choice. A more cumbersome option would be to use different software solutions. However, these usually only cover a certain area and can hardly be networked with one another, if at all. With an ERP system as central database all employees have access to the same data and information. In addition, company owners can view forecasts and trends for the future of the company.