The following outlines some reasons why organisations implement an ERP system.
Management of Data
- ERP allows management to gain a clear and accurate understanding of the organisation’s financial position and performance at any time. It can reveal a full profit and loss position, how each business unit is performing in terms of how many sales they have made and what are the best and worst selling items. Management reports can be generated quickly and easily. Many directors’ of companies want to know the current financial position and how well the company is doing on a daily basis.
- ERP enables people to find important financial information in one place rather than having to speak with a number of different departments who are running their own software packages that may be difficult to integrate.
- Reduce stock levels. ERP allows companies to fully understand how many items that are in stock, which ones are the best selling items and those that are not selling. As a result, an organisation will not keep too much stock of a product that is not selling. This helps reduce the value of stock it is keeping and prevents perhaps many thousands of pounds worth of stock just sitting on the warehouse shelves!
- Personnel and human resources. Processes such as payroll and working out tax and national insurance can be automated.