Before beginning this blog, we recommend that you read our blog on Project Stages and Ongoing Investment of ERP Implementation, as this will allow you to gain the maximum benefit this blog. We have already outlined the main project stages required to set-up and implement an ERP system, but why should you limit your business’ growth by stopping here when there is so much powerful information available to help your business grow.
Initial implementation and set-up of your ERP system can be seen throughout Stages 1-3. Stage 1 involves planning, design and testing of your unique ERP solution while Stage 2 builds on this with testing and deployment of your system. Many businesses do not proceed beyond this stage of implementation, which reduces the potential benefits that can be reaped. Businesses that continue into Stage 3 will ensure their business runs smoothly and achieves your desired results with system optimisation, maintenance and produces the greatest competitive advantage.
What benefits can I expect when I have implemented my ERP system?
You can expect many benefits when you reach the end of Stage 3 implementation including increased productivity and efficiency. Our blog, 11 Reasons You Should Invest in an ERP System, has identified some benefits you can expect to gain when you invest in an ERP system. ERP systems can streamline your business processes into a centralised location without compromising the quality of your system. They can also reduce labour costs and working capital costs, and therefore human error, by automating repetitive manual processes to allow you to complete all your business processes in one place. This reduces the need for multiple systems and therefore synchronises the input of your data to allow the fast output of real-time, insightful reports that can help you respond to weaknesses in your business and minimise loss. ERP systems provide you with advanced analytics that enable you to make smarter business decisions and strategies that improve your Return on Investment (ROI). Successful businesses begin with satisfied customers, which requires you to know your customers. ERP systems allow you to boost your customer satisfaction with integrated Customer Relationship Management (CRM), which holistically manages and meets your customers’ needs.
ERP systems simplify complex processes including customer management, financial management, accounting, purchase order systems, stock distributions, customer portals, project management, compliance, and supply chain operations. These systems give you the ability to control and delegate authority to your employees to ensure the whole picture is available to everyone who needs it. You will have the ability visualise your business processes, such as monitoring your inventory across multiple locations or products, optimising production schedules and forecasting future sales to determine the raw materials you might require. Integrations and customisations to your ERP system can allow your unique business needs to be met. No two businesses are the same, therefore it should not be assumed that one out-of-the-box ERP solution will suit all businesses. Integrations can give you further control over your business processes, such as OpenCart or other retail websites that generate sales orders and payments automatically.
What if I haven’t got these benefits?
If you are using a system that isn’t allowing you to gain these benefits or do not have an ERP system at all, you should consider investing in an ERP system. Systems that are expensive and do not achieve the maximum benefit for your company will continue to cost you a lot of money in the medium to long-term and will hold your business back from achieving full potential
Moving Beyond Stage 3 into Stage 4a (Phase 1)
If you stop at Stage 3, you have essentially just invested in an expensive system that does the same thing as your initial accounting system. Since you’ve spent the money, why limit your business’ potential by stopping at Stage 3 of your ERP system implementation? Moving beyond initial implementation into Stage 4a brings endless possibilities to your business, including the enhancement and leveraging of higher-level benefits.
Your ERP system will do everything that your accounting system does including accounting functionality, payroll, invoicing and bank reconciliation. However, your ERP system also has the potential to future-proof your business. ERP systems are fully customisable to meet your needs. It has several additional features and workflows that build on what your basic accounting could achieve, including: inventory management, warehouse and manufacturing management, financial management, customer relationship management, supply chain and distribution management, General Ledger and inter-company reporting. These features give you the power to assign your employees access to certain parts of your workflow and processes by delegating authority. This means that you will always know what is happening in your business, for example you can require your managers to report to higher level authority to process an order. This ensures your employees are operating with an appropriate level of authority and access to ensure they are not making decisions that are beyond the level of their position.
ERP systems are highly customisable and contain configurable reports and dashboards that allows you to visualise your data in a way that helps you make smart decisions to grow your business and reduce time to market. Your ERP system has the capacity to forecast future trends in your business to help you identify and manage your risks to ensure you have the competitive edge to outcompete your competitors. Why not build in some competitive information on your competitors’ activities?
Your ERP system also offers customer portals that allow your customers to see their information, price quotes, invoices, and ordering history. This increases customer acquisition, as your customer relationship management software will provide your customers with convenience and a self-service that offers personalised content for your current and future customers while increasing customer satisfaction. It also allows you to track your customer’s behaviour to generate sales leads and trigger relevant marketing messages. Your customer portal reduces administrative time on preparing and sending copy transactions and minimises the need for manual data entry, which ensures your employees are working on their core duties so business efficiency can be maintained.
But why stop here?
Next week we’ll delve into Stage 4b (Phase 2), which covers how your business can gain competitive advantage. Then following this, we will discuss how we can use competitive advantage gained in Phase 2 to leverage and maximise your profit by reducing your company’s risk in Stage 4c (Phase 3).