The Truth About ERP Systems

An ERP (Enterprise Resource Planning) system is basically an information management system that’s integrated to manage the flow of information along different functional departments in a company. An ERP system fundamentally standardizes processes, and it stores and organizes data to allow users to access them quickly. A typical system generally includes a database that’s accessible to all departments and a number of application modules to facilitate and support everyday business practices. The most common modules are (a) financial management, (b) human capital management, (c) manufacturing management, (d) project management, (e) supply chain management, (f) customer relationship management, (g) supplier relationship management and (h) product lifecycle management. Small to mid-market businesses purchase the system when they begin to experience inefficiencies, miss important deadlines, lose customers, lose suppliers, and others. And while ERP systems definitely increase a company’s efficiency and productivity, every company must understand that no single ERP system package offered on the market will fit their company exactly or perfectly. This means that an amount of customization and configuration is always needed, as all companies are unique. Moreover, a company can opt to purchase a complete suite containing all modules or to buy a combination of modules depending on their suitability with the company’s business requirements. Also, implementation of the system, be it a suite or a set of modules, always takes a certain amount of familiarity in order to fully maximize and optimize any kind of ERP system. For this purpose, many ERP developers offer trainings, like Sage’s ACT! Training online, to help companies use their system to its full capacity. Experts recommend that companies or organizations purchase only modules that suit their operations and then mix and match these modules to effectively increase efficiency and productivity. A nonmanufacturing organization can, for example, purchase a financial management module like Sage’s Peachtree Complete Accounting, skip all the manufacturing modules and purchase only modules that are relevant to the business. Going back to implementation, organizations must remember that implementation is the most delicate and crucial part of using an ERP system. Weak or poor implementation may render even the best ERP systems next to useless. Thus, it is always recommended that you send a representative to undergo training, or better yet, submit your employees for a course on ERP implementation, like Sage’s MAS training program, in order to maximize not only your investment on the software but also your business’ potential.