Why Is ERP Important To A Company?

Why is ERP important to a company? Well, an interesting question I must say! But before we see why ERP is important to a company, we need to know more about ERP (Enterprise Resource Planning). For the uninitiated, Enterprise Resource Planning is a comprehensive and complex software system designed to handle all the operations in a company. As you know, a company (especially a large one) has got a very complex structure. There are various departments like sales, accounts, inventory, human resource, distribution etc. under the same roof to get the best result for the organization. But when there is a mismatch in communication between these departments, you will experience loss. In the real world, these mismatches always happen.

For example companies used to have separate database for separate departments. Human resource database had all the details about the employees. Accounts software had all the details of the financial transactions and bills. Inventory database had all the details about the inventory. But when you need certain information from a certain department, you have to manually request and wait for the data. Even a small mismatch can result in huge loss - both in terms of time and money. So, it’s extremely important to have a centralized system which can effectively communicate between these departments or modules. That’s when a system like Enterprise Resource Planning comes to the fore. Let’s see more about why ERP is important to a company.

For the efficient working of any company or organization, it needs to have an efficient system to handle all its data. Is ERP important to a company? Well, we just answered your question. Enterprise Resource Planning is extremely important to any business and you get one as soon as possible to ensure the smooth running of your company. Why is ERP important to a company – well, answer to that question has got lot to do with the benefits of using Enterprise Resource Planning software system. Let’s see more of that below. The size of the company doesn’t matter, be it mid-size or large-size your company would definitely need a centralized database to handle all your data. First and foremost, there are so many operational benefits compared to a decentralized system.

With an Enterprise Resource Planning system, you will be able to reduce the inventory. When you reduce the inventory, you will be saving money and resources in every department. Moreover, the ease and speed of the operation have improved hence resulting in faster turnaround. And above all, the communication between various departments has been improved tremendously with the help of Enterprise Resource Planning software.

Another great benefit is the strategic planning. When the companies have all the data they need in hand whenever they want, they can focus more on the strategic planning to enhance and elevate its performance in the industry. The most important aspect is that this data is readily available. The data is pulled from various departments to make it easier for you to handle your business. When you have the data so fast, you can focus your energy on the strategic planning which is essential for the growth of the company.

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Keywords: Factors for Successful ERP Implementation, Top Ten ERP Software, Cost of ERP Ownership

By: Terro Dashner

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