One simple reason to do an ERP implementation is to lower IT costs and improve efficiency. Having a unified ERP system can greatly lower IT-related expenses, including management/administration staff, support, infrastructure needs, and application licensing. Using a single system also reduces training requirements for end-users, since they only need to learn one system rather than interacting with numerous individual applications.

Using disparate, poorly integrated business software systems can lead to messy, non-standardized data. This increases the chances of year-over-year comparisons being inaccurate, making the process more difficult and time consuming. This becomes a serious detriment to accurate forecasting.

A modern ERP system comes integrated with all the necessary applications. Meaning, your data is standardized and the tools to see year-over-year comparisons and forecasts are built in. These are often presented in an easy-to-read dashboard format.

Implementing an ERP suite across departments means your organization has a single, unified reporting system for every process. By having a single source of information, an ERP system can readily generate useful reports and analytics at any time. This software gives you the ability to analyze and compare functions across departments, without the hassle of multiple spreadsheets and emails. One of the most popular reports involve finances (go figure). Standard financial reports such as income and cash flow statements generally are built-in, and custom reports can be quickly generated by users without IT intervention.

In addition to this, many ERP vendors also offer Business Intelligence services with their software. This BI functionality allows businesses to gain a deeper level of analytical insight into their operations. These insights aid in corporate planning by identifying both operational strengths and problem areas that need improvement. Providing this kind of detailed view into a company’s data gives ERP users the ability to make better-informed decisions based on end-to-end trends and metrics.

Along with reduced IT & training costs, an ERP can reduce the time and effort required by your workforce to carry out their daily activities. Properly implemented, an ERP can greatly reduce or eliminate repetitive manual processes, thus freeing up team members to focus on revenue-affecting tasks. The system likewise can aid in the adoption and enforcement of industry best-practice processes, lending familiarity to all actions across the enterprise.

Inefficient processes and decentralized data mean greater labor costs for businesses. These can be especially detrimental for small to midsize businesses (SMBs) that have limited resources.

ERP systems can automate and streamline daily processes, freeing up your employees’ time to do things that actually generate revenue. For example, software can automatically tie sales orders to the accounting system, or run reports without the need for complicated spreadsheets.

businesses should treat ERP as a technology strategy. It can efficiently automate and link administrative and operational capabilities such as finance, HR, purchasing, manufacturing and distribution to help achieve business flexibility and agility.

Let’s take the example of a manufacturing ERP system. The typical structure of manufacturing ERP solution consists of these main functional categories:

That’s quite a list! If your organization isn’t using an enterprise-wide solution like an ERP system, it’s probably using a different software system to fulfill each of these functions. And when businesses manage several business functions separately, many issues can arise. These include data errors, duplication of functions or records, lack of visibility into the business as a whole, and lack of communication between different areas of the business, to name a few. An ERP solution integrates all of these disparate business functions into a single system and allows them to communicate with each other.

When implementing an ERP system, companies are forced to consider—or reconsider—their business processes and workflows. It’s a perfect opportunity to assess what makes sense, what works, what’s important, and what can be improved. And by running the ERP system, your organization can gain speed, efficiency, and accuracy in its business operations. A more efficient business is good for everyone. A modern ERP system will help you meet the demands of your business partners and external stakeholders, and it can help keep your employees happy and productive too.

So through automation and integration, the ERP system can increase your organization’s productivity while reducing time and labor costs.