5 Methods to Make a More Effective ERP System
Because of the complexity of the ERP software, many companies tend to under-utilize the benefits it can give to the convenience of the organizationâ€™s processes. Not all companies implement ERP software into their systems, but they are gradually accepting it that it is necessary these days for the convenience of accessing information from one source. You know that you are in a good situation when you find your business struggling to achieve the visualized ROI for the Effective ERP system.
Rather than leaving the other modules of the ERP software unused, here are 5 methods to take advantage of efficient ERP system and add business value to your organization.
Familiarize the purpose of the ERP software and the reason for using it
While ERP is entirely created from technology for the general purpose of centralizing every functionality in an organization, it is way more than that. However, most vendors and businesses tend to put it that way.
ERP was originally created as a set of practices and policies that are going to deal with the supply chain. The meaning of it has shifted towards the software sector decades after the concept was implemented. This explanation was explained by a co-author of the â€œSales and Operations Planning: The How-to Handbookâ€ Robert Stahl. He is also a consultant for supply chain enhancements. These days, not many people use the ERP term to mean about its origins, but rather more about the software. He also added that such products are typically not designed in addressing operations and sales planning.
The areas that the ERP is designed for is to handle inventory control, purchasing, materials management, supply chain, accounting, finance and production selling.
It is your responsibility to know what the ERP is designed to do so that you can clearly define why you are utilizing such software. The reason that you come up with must be grounded with answers to questions regarding your business.
Take time in optimizing ERP by process re-engineering
The answers that you have gotten from the previous method is only possible to realize if the ERP is treated in a strategic way that involves business leadership and IT. This is done together with the software package that supports the goals defined in the organization. Most businesses and organizations that have implemented ERP will agree that the system by itself will never be able to solve the problems. This must be married into the business processes that are already enhanced.
If you wish to turn your business into a more positive image using the ERP, you should put the time to have an effective streamline and change the processes that come with it.
You should not expect your ERP vendor to do the first step in doing the re-engineering process for you. Vendorsâ€™ main responsibility is to see their products sell and implemented. This happens faster if the minimal time needed is spent more on the process change. Typically, the vendor interviews everyone in the organization to find out what jobs they are responsible for and will use the data they have gathered from it to tailor it to their solution. But interviewing them one by one is not going to paint the full picture of how the processes in a single area flow into the processes in the organization as a whole.
What you need to do is gather all members of the organization in a single room at the same time together with the vendor. It will make the ERP more efficient if done this way in the long run. This will take money and time to do the process re-engineering. But you will get tremendous results afterward.
Train the staff responsible for the system that is aligned with the needs of the user
Talking about the members of your business or organization, the staff that will be responsible for the ERP system must be trained for it as it is the key component in getting the maximum value of the software. The yearly budgeting and planning for the ERP should include the targeted and remedial training that are identified via audits of how the staff is utilizing the system. This work at its best if you utilize different training channels and methods. Then focus on learning by incorporating and doing the aspects not only about â€œhowâ€ but also with â€œwhy.â€
Develop and preserve a continuous enhancement strategy
ERP is not a function where you set it and then forget it afterward. It is a system that needs adjustments over time, especially when the demands of the industry gets changing over the years, too.
You will get the most value of the ERP as you keep improving your plan. This includes the yearly budget and reviews done on a regular basis. You build this plan upon a foundation based on insights from the assessment on business processes described above. Focus solely on tools and processes that can be repeated using the greatest practices that can survive turnover of employees.
Use of reporting and custom dashboards to maximize value for the users
The ERP software of today can be customized and should be done so for the users in different departments in the organization. Team members working on accounting need a different kind of tools, which is also different for the purchasing managers. They may be able to use the same system, but the interfaces are personalized for the responsibility they hold in the company.
When the system is customized for every ERP user that will provide them information that is most important to their job, the right and accurate data are then delivered to them. This will even become more effective when this is tied with custom reports created to help every user leverage the data as actionable information.
If your company is just getting started with customization or personalization, you have to focus first on the most critical aspects of the system. Pair this up with realistic expectations on what is the possible resources available, set it out in understanding how the software functionality can address the key factors of the success of the business; then you can start from there.