How Do You Know Your Business Needs ERP?

Xapps colloboration with SAP Partners

You’ve just realized that your business is in the middle of turmoil that you are having difficulty getting out of. You find that is taking longer than usual to reconcile your financials every end of the month, and this has been going on for a couple of months already. You see your sales forecasts are all based on guesswork rather than accurate solid figures. You also find that business having trouble keeping up with the order volume, resulting to falter in customer satisfaction. You don’t even have any idea how much inventory is left in the warehouse, and you find it annoying to find out. When all of these are going on, you should have the ERP system implemented in your company.

Since every ERP business blueprint is unique, there is not a single sign that will tell you how badly you need the ERP system. Companies that will get the greatest benefit from using the ERP software are those that are experiencing similar problems of their own. Read on to find out what are the top signs that your company is ready to take on the ERP system.

You have different software operating on different processes

Rather than getting confused about what to do, take a step back and observe for a few minutes on what your employees are doing, especially those that are in charge of recording, tracking, and processing information. Does the accounting department use one system for the payables and receivables, while the sales use one of their own to input customer orders? Is the process of all these taking a long time to get fulfilled since they are done manually? Do the employees in the warehouse use their solution as well in tracking receiving and shipping orders?

When there are various back-end and front-end systems running on their own individually, it can be a disaster on other processes that were supposed to ensure the company to run smoothly. Without the accurate data coming from sales, the one that will suffer is the inventory management. If there is no latest information coming from the accounting, it can trigger one disaster after another, which can affect first the marketing budgets all the way to the payroll.

All of these problems can be solved and avoided when you use the ERP software. It will integrate all the individual systems, thus making every business function is connected through a single database. Since there is only one source of information where all the accurate and real-time data are stored, it breaks up all the logjams and helps the staff make decisions better and quicker. This also frees up their time from manually retrieving and entering information and spending it more on high-value activities like looking for ways to make the business grow even faster.

It is difficult for you to access information

And it is not just any information – it is one coming from your business. When someone asks you about the average sales margin of your business, how long will it take you to find out? How about performance metrics, like sales or orders per day? Companies that have solely relied on separate spreadsheets and systems that need to be reconciled and updated manually, you can already imagine the long time it takes to do find out.

Every business today is getting faster due to the demand from the public and the tight competition that they have to face with it. Employees should also follow as well, but they can’t do it faster when the system is still the same as before – manually retrieving information. So what they need is immediate access to all key data. With the ERP system in place, the executives will be able to get a holistic view of the operations of the business any time they want, while the staff can acquire information that is needed for their jobs immediately and in the most convenient way. For instance, the sales representative can view the transaction history of the customer and can improve the renewal rates and at the same time increase the cross-sell and upsell opportunities.

Accounting gets difficult and is taking longer

Sometimes, the first signs that you notice that says it needs the ERP system is the situation you see with the accounting department. If your employees are still relying on an old antiquated system such as paper-based sales orders and invoices, you have to consider the time wasted on such tasks, like the hours spent every week manually inputting them into different sales and accounting systems. The ERP system can handle everything instantly.

The same can be said with financial reporting – it takes a lot of time to reconcile or consolidate financial information to all systems in the company, not to mention it has to go through spreadsheets after spreadsheets, the ERP system can reduce the time spent for this. Since all financials are stored in a single database, the accounting staff do not need to spend hours cross-posting the information, reconciling data and rekeying the numbers manually. The accounting department will become more productive, freeing the staff to deliver the critical reports without frustration and delays.

Customer experience and sales are affected

And this is affected in a way that they are suffering. When companies grow, one of the biggest challenges they face is often the inventory management. To ensure that the right products are in its designated location at the perfect time is the vital part of operating a business.

When sales, customer data and inventory are maintained in different locations, it can give serious problems throughout the company. When you run out a particular famous product, sales for it will be put off until the arrival of the next shipment. And when the customer calls in to inquire about the order and the employees can’t track if it is already shipped or the product is in stock, the company will attract poor reputation in the field of service and reliability.

Having the ERP system implemented, staff in each department can access the information even if they have to do everything at the same time. Customers can access their account online to view the status of their order whether it is already shipped or not. The warehouse manager can even see whether the products are low and reorder when needed.

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