ERP stands for Enterprise Resource Planning and is the term used to describe a software package or hosted system that brings together all of the business processes into a single database system that can be centrally managed.
The types of systems that an ERP will consolidate vary a great deal depending on the business to which the system is being integrated but some common types of platforms that will be merged into an ERP system include:
- Customer relationship management (CRM)
- Human resource management (HRM)
- Supply Chain Management (SCM)
- Financial management
- Manufacturing Resource Planning (MRP)
Why use an ERP system?
The reason why an ERP system is so beneficial is due to the fact that everything is centrally managed which removes any chance of duplication in terms of data storage and also initial input. In addition having an ERP system gives teh company access to a single point of information across all departments, disciplines and physical locations meaning that everyone is working with the same information all of the time.
These benefits mean that having an ERP system in place not only increasing productivity but allows the company to have a much more transparent view of their entire operations which in turn makes reporting and analytics far easier allowing the company a greater insight into overall business performance.
Introducing an ERP system into an existing business model can be very difficult especially when there are many different systems and platforms that require consolidation. Finding the right ERP solution can also be troublesome as there is so many factors to consider not only when choosing an ERP solution but also when deciding how to migrate each part of the existing business systems.
there are some great sites out there that offer impartial advice on ERP systems in terms of how they can be decided upon and integrated such as erpblog.nl. Whilst we don’t want to reproduce the information that is already available else where in this article, we do aim to provide an overview on some of the most common tasks that are faced by companies when planning to implement ERP systems as well as outlining the process that is required when doing so.
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Auditing of existing IT systems
Before getting into any talks of ERM systems it is important to have a full picture of the existing systems that are in place in terms of IT and data management. With this audit in place it is much easier to see what systems need to be migrated into the ERP platform as well as being able to see what tasks the ERP system will need to accommodate once it is introduced.
The best way to create this audit plan is to note all of the business processes that are in place and then detail the software that is used for each process. At a later stage in the project this information can then be expanded upon to include migration paths to the ERP system.
Finding the right ERP system
Once the information is available in terms of what the new ERP system is going to be replacing the next step is to find the right solution and/or partner for the job. There are many different ERP solutions available – some in house options as well as some hosted options and the right one will depend on the types of features that are required as well as the amount of work that is involved in migrating from existing systems.
customizing the ERP system
Once a solution has been decided upon it is important to get the system working correctly before existing application data is migrated over. The system needs be capable of handling all of the existing business processes listed in the first stage of planning and perhaps also should be able to handle additional tasks that perhaps the individual systems could not handle in the past. For example, it is important that different areas of the business and the information that it produces are able to integrate with each other.
Training staff to use the new system
Once the system has been introduced the final stage of the project is to train the staff within the business on using the new system. this stage is as important if not more important than all previous stages because as with any system it is only as good as the information that is put into it.
Any ERP system will be a huge change to the business that introduces it in terms of the way information is gathered, handled and recorded so new processes need to be documented and passed on to the staff using the systems on a daily basis.
In addition to initial training sessions, these processes should be reviews and modified on a regular basis to ensure that the company as a whole is making the most of the ERP system.