Growing companies eventually reach a point where Excel spreadsheets no longer serve the purpose for their business. That’s when Enterprise Resource Planning (ERP) software comes in. ERP systems have established their dominance in the field of custom software development for business.
These systems collect and organize key business information and help organizations run efficient operations, even when they are expanding. Most business professionals may have heard the term ERP, but they might not be aware of what this software can do for their teams.
In this guide, we’ll explain exactly what an ERP system is, how to build an ERP system, and what it can do for your organization. So, without further ado, let’s get started!
What is Enterprise Resource Planning (ERP)?
Enterprise Resource Planning or ERP refers to a type of software that helps organizations manage day-to-day business processes from one place. It can include activities such as inventory management, logistics management, accounting, and more.
The primary goal of an ERP system is to optimize and automate the processes to boost operational efficiency and company profitability.
Modern ERP systems use the latest technologies such as machine learning and artificial intelligence to provide intelligence, visibility, and efficiency across every business unit.
Now that we have defined what an ERP system is, let’s have a look at a few interesting statistics indicating the growing popularity of ERP systems.
Enterprise Resource Planning Market Overview
As per the statistics, more than 53% of businesses believe ERP is one of the priority sectors for investments. The top most important reasons to implement an ERP are increasing efficiency (35%) followed by cost advantage (29%).
Another report by Allied Market Research indicates that the global ERP market will grow at a CAGR of 9.8% from 2020-2026 to hit a market value of over USD 86 billion by 2027. The key factors impacting the growth of the ERP market are the need for operational efficiency, the surge in adoption of cloud & mobile apps in enterprise digital transformation, and an increase in demand for data-driven decision-making.
Why does ERP matter to your organization?
Organizations employ ERP systems for various reasons, such as expanding business, reducing costs, and improving operations. It also helps in legacy system modernization also empowers businesses to be adaptive to customer needs and enhance the customer experience.
Here are a few key benefits of the ERP system that contribute to your organization’s overall success:
Improved productivity: ERP automates routine manual tasks and processes. This helps your business save a lot of time and remove instances of duplication, error, and rework. As a result, employees perform better and complete more tasks in less time. Also, integrating ERP systems allows your employees to spend less time on repetitive work and more on those tasks that generate revenue for your business.
Better collaboration: The unified system that contains all business-related data improves cooperation between enterprise branches or departments. ERP software reduces communication delays across the whole company. This is beneficial if your organization has a distributed network of affiliates in several states or even in different continents.
Faster decision making: ERP provides a real-time view of data, with easy-to-use reporting and analysis that empowers intelligent decision making. For example, with an ERP system, you can see which workflows are efficient and which ones are losing you money.
Better customer service: Another major benefit of ERP is that it helps in offering better customer services. A centralized data storage provides all necessary information on sales and clientele. This makes it easier for sales managers and customer support staff to communicate with clients and reduce delays in offering services to customers.
ERP also helps in faster access to customer histories. This, in turn, adds to other benefits such as accurately analyzing data on customer behavior patterns and more precise predictions of demand that must be satisfied accordingly and in proper time.
Built-in compliance: It’s important that your business maintains regulatory compliance. One of the most powerful advantages of ERP systems is that they help keep track of industry regulations and changes in compliance. This allows businesses to stay ahead and in compliance with guidelines, relevant laws, and specifications.
Scalability and flexibility: Another important benefit of ERP software is that it allows adjusting its scale according to current needs and situations. An ERP system easily adapts to the expansion or reduction of the company on every level. ERP systems can easily handle changes such as production increase, inventory extension, the addition of new functions, services, or users. In short, it helps in enterprise digital transformation.
Better availability of information: Advanced ERP systems enable the effective and centralized collection, processing, and storage of information on the product, sales, or customers. Thus, a single data system is used instead of multiple databases that require regular checks and synchronization to remove duplicate or obsolete information.
The increased quality of internal data of all kinds leads to further performance optimization on all levels of the enterprise. Particularly, supply chain and inventory management are the activities that benefit the most from ERP implementation.
Enhanced reports: ERP software leads to reduced paperwork and improved communication among departments. It helps in the quick and easy submission of all kinds of reports such as financial, customer behavior, technical maintenance, etc.
ERP software development creates opportunities for significant growth for businesses. By automating API-based ecosystems, you can significantly enhance team productivity and increase your reach to scale your revenue. On the other hand, customer experiences are also enriched with faster, more satisfying interactions.
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