ERP Objective

What is the end goal of ERP?

Technology is the name of the game in the twenty first century.  Suppliers, manufacturers, and retailers have three primary goals in mind: increase their demand by making their products and services more accessible, decrease lead time and overhead, and be able to come up with an accurate determination of margins by getting as close as possible to the real cost of products and services.  Technology achieves these goals by offering products online, automating processes such as issuing purchase orders and initiating work orders, and by automatically tracking the cost of operations.  All of these goals are overlapping and increasingly dependent on data that communicates seamlessly with each other.  Centralizing all these goals within a single system, rather than leaving them unconnected in various different spreadsheets and software, is one of the biggest challenges that modern businesses face and Enterprise Resource Planning (ERP) has been invented in order to tackle it.  The future is bright for ERP and if your business is not currently using it (or using it to its full advantage), a strong case can be made to get started as soon as possible. 

Naturally, people resist change and prefer to operate “the way things have always worked.”  However, the way things have always worked is not usually the most efficient way to get things done.  Many businesses rely on separate software, spreadsheets, or even paper for their bookkeeping and processes.  A given company may manage time tracking for employees in one software, a product catalog and inventory management in another software, accounting in another software, a company website in one system, communication via email or texting, and sales in yet another software.  Spreadsheets and physical paper are even less efficient because it is even harder to make them communicate with each other.  Business processes and software ought to speak to each other, not get in each other’s way.  Running all these processes in separate places makes organization difficult and increases overhead which is extraordinarily expensive.  If this sounds at all like your business, you should begin considering the possibility of moving to a single system that is the one stop solution to all your business needs.  ERP was invented to offer such a solution.

Currently, the ERP industry is growing 10% to 20% on an annual basis and the trend towards single systems is expected to continue for a long time into the future, eventually becoming the status quo for modern businesses.  There is good reason for this.  Within a single system, users are able to manage their entire business:  including time tracking via kiosk mode on a tablet, inventory and accounting management, offering their products and services for sale or estimate on their website, providing company wide communication within channels and direct messages rather than confusing email chains, and managing sales.  What is the advantage of having all these processes in a single software rather than distinct applications built for specific purposes?  Data communication between connected applications facilitates a system that is “smart” and can be used to make the most informed business decisions.  Sales orders automatically generate manufacturing orders and initiate purchase orders for missing components.  Approved manufacturing orders initiate work orders that automatically track time via tablets in order to identify the real time it takes to assemble a product.  Advanced visual reporting plays an important role in making strategic business decisions.  Originally, this kind of system was extremely expensive and exclusively for large companies.  Fortunately, Odoo offers ERP that is an affordable and a practical option for even the smallest of businesses and is currently the strongest contender to more popular systems such as NetSuite and SAP (stay tuned for a future article to find out why BizyLife has committed to work exclusively with Odoo).

Software is improving so rapidly and making processes so much more efficient that in the future, dependable software will be the deciding factor between businesses that fail or thrive through the test of time and economic changes.  As data becomes increasingly valuable for painting a holistic picture of a business’ needs, making accurate predictions, and automating tasks, ERP will continue its trend towards replacing existing infrastructure.  It is important that when choosing an ERP provider for your company, that you choose one that is reliable, comprehensive, simple to navigate, and actively improving and growing as a company.  Schedule a meeting with one of our consultants in order to find out more about your business and analyze whether or not ERP is right for you.

ERP Objective
Jacob Neubaum July 8, 2020
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