3 Things you Need to Know About ERP Software
Enterprise Resource Planning (ERP) came from the need to automate various back office functions. It is used widely in a number of business logistics tasks as a way to centralize organization and bring together all areas of production leading up to the finished product, essentially streamlining most, if not all, back office tasks. This is achieved via ERP software.
The software generally provides a visible audit trail of production, enabling up to date costing, sales and provision of all quality documentation associated with the finished product from a centralized dynamic database accessible by all departments.
As a part of costing and administration, it can also provide relevant Risk Assessments/Method Statements employed during manufacture, data analysis, inventory reporting, trend analysis and usage, and timesheets applicable to work carried out for purposes of accounts department costing.
In a nutshell, ERP software streamlines and automates various business tasks via a centralized database.
Evaluate Your Specific Needs
ERP Software incorporation can be costly. To counter this a bit, a lot of decent ERP platforms allow you to purchase specific modules as you need them. In this way, ERP software often features this sort of a la carte component which is great for companies that like to keep savings in mind. By doing it this way, you only purchase what you need and have the ability to purchase more modules or change them out as your needs change and grow.
Of course, before you make any investments in a new tool, you need to ask yourself a few questions:
- Does the business plan to scale in the foreseeable future?
- What will my supplier(s) and customers look like in the future?
- How and by who will the system be used in the future? (dictating the choice of modules)
Size and Function of my Business Now and Anticipated in the Future.
- Businesses cannot make money standing still. Profitability demands development, resizing, more innovative means of manufacture, automatic equipment incorporation, production line strategic rationalization, larger/multiple premises, services …. the improvements are endless.
- You need to be perfectly clear on your future projected/expanded endpoint, so that the chosen system has the capability to cope with the operations which it will be expected to run, as well as being sufficiently flexible to accommodate an increased number of future new users as your operation expands and more staff are employed.
- Do you anticipate the addition of alternative product lines that may require an additional module, and how easily it can be fitted and incorporated into the system without a detrimental effect on those modules already there?
- Is it your forward plan to introduce a payroll/HR/administration/sales department. ERP software covers all HR functions an employee goes through during their time with your company.
Suppliers, Vendors and Customers
- Are they going to continue in the long term of supplying you with the specific materials in sufficient quantities (effectively the “one-stop shopping” facility).
- In the event of increased demands from yourself, will they be willing/capable of raising productivity levels to be able to rise in parity? Do you need to consider replacing them with larger companies with similar catalogs?
- Will present vendors/customers be willing to become integrated into your ERP System.
- Will they be capable of dealing with phased implementation of ERP in your business. ERP systems are complex, and it is not possible to determine all the implementation requirements upfront, then implement the system, train users and go live. Will routine activities, therefore, need to be put on hold while launching the ERP and getting things going.
Choosing a Module
- What is specifically needed for the system by the workers who will be using it to make their tasks easier/more efficient?
- What challenges will the use of such systems present to its users – how much training will be needed?
- Technological system upkeep/maintenance must also be considered. Too many companies fail, prior to beginning migration to a new ERP solution, to identify crucial software usage issues and map out critical processes, or consider dedicated, trained employees to look after the system opting instead for far more expensive visits from ERP System provider field engineers.
Still not Sure Where to Start?
The world of Enterprise Resource Planning can oftentimes be a tricky one to navigate.
The good news is that it doesn’t have to be. With an experienced like Redwood Logistics 3PL on your side, you can quickly get an ERP platform up and running in your warehouse, distribution center or retail location.
Drop us a line here and let our team of implementation and planning experts go to work for you today!