In this digital era, businesses are rapidly evolving and the dependence on technology is increasing so much that it has become almost impossible to survive in the market without it. Though businesses have been using software programs in their organization to serve different purposes; they represent failure when it comes to collaboration.
ERP is the link between Enterprise Software Programs:
Individual software work best in their capacity but data generated from such software is stored in a different database. There is no interlinking or data communication due to the lack of a centralized database. This augments communication time between departments and hence the response time is increased. For instance, imagine an organization where the order management system has no connection with the accounting system i.e. accounts department is unaware that the order has been taken and payments are pending until they are informed by the sales or production department.
The information from one system to another system has to be physically shared through phone, emails, flash drives or on the cloud storage system. Software codes are different due to which they fail to integrate with each other. The solution to all such problems is implementing an ERP solution in the company.
Strengthening inter-departmental data interaction with the help of an ERP:
ERP is a resource management system that controls the entire organization through a centralized database. The inter-departmental data interaction strengthens collaboration across the organization. A data file updated in one department is visible across the organization in real-time. This cuts down communication time within departments and quickens the pace of day-to-day operations.
Since data is not scattered across the different system; it makes data management and data analysis easy. Employees can generate reports to find out the cause of the problem and suggest a solution instantly. If the stocks in the inventory department are depleting faster, the production department will be alerted to increase productivity and revise the production schedule to meet orders.
When a sales executive takes an order and updates it in the system, the corresponding departments are alerted to do their duties. The purchase department will buy raw material, the production department will align the production process and start production, and the accounting department will generate bills for the order. If the order is released in phases, then multiple bills are generated and everything is very well synchronized as the information is clearly visible in the system avoiding unnecessary delays in communication.
Cloud makes things easier to collaborate:
Most of the leading cloud-based ERP systems can be accessed from personal gadgets like smartphones, tablet, laptop etc. It makes it easy for remote employees and field employees to access the system anytime and anywhere. ERP system empowers customers to track their order status and billing information thereby generating a high level of satisfaction.
When a business has multiple vendors, it becomes difficult to classify and prioritize them. Failure to do so decrease your negotiation power and the vendors don’t feel confident to do high volume business with your company for a long time. A long term vendor strategy infuses stability in the business. The transaction history with every vendor is stored in the system.
ERP helps you in shortlisting vendors by evaluating their qualification and trusted partners tag with them. Vendors can be granted access to your raw material inventory and when the inventory levels are reduced below a certain point, they automatically release another set of shipment.
This kind of automation across the organization reduces human tasks, human errors and consequently sheds a lot of burden from the human resource department. You can use the available human resources for other productive purposes. ERP guarantees everything that a modern-day business desires. Moreover, third-party tools can be integrated with the system to enhance its capability.