The benefits of ERP are countless, considering the vast sizes and spectrum of industrial units it can serve. Fully termed as Enterprise Resource Planning, it’s a newly grown entrepreneurial software technology, helping leaders and management of companies to make principal decisions that will make their operations more organised and efficient.
A survey by CIO magazine in early years, that focused on the relevance of ERP in large and midsized organisations, revealed “Businesses can’t live without it.” Surprisingly, the study disclosed that companies are becoming dependent on ERP software solutions after being plagued by higher ownership and operations costs and complex system integration. This presumably persuaded the companies yearning for cost-efficiency and innovation to embrace ERP systems soon.
The results of the survey hold true at present when enterprises in almost all industry verticals are deploying the technology deliberately to get a competitive edge over their market counterparts.
- According to the reports of Allied Market Research, ERP Software market is projected to reach near about $ 42 Billion by end of 2020 at the global market.
- Panorama’s autonomous research on the ERP implementation across specific industries unleashed that 81% of organisations are on the way of implementing ERP software, 14% are in the midway of choosing a fitting software, and 5% are going to upgrade their existing software system.
- More impressively, independent research by Panorama Consulting Solutions revealed the actual reasons for fast implementation of ERP by businesses.
The Bigger Picture
Specifically, ERP software systems allow businesses with the power to scale across HR, supplier management, customer relationship and other areas. Being a multi-layered, complicated and integrated software, it helps enterprises to collect, store and manage critical business data and connects every person, department or process within them with the right set of information. Here’s recounted how some specific business segments are getting benefitted from ERP software extraordinarily in the recent years.
Manufacturing is the umbrella term for core industries like consumer products, automotive, retail, electronics, defense and aerospace equipments. On being asked which areas in their business call for ERP, manufacturers cited financial and accounting, followed by procurement, order procession, dealers and supplier management, inventory and HR. As per the discretion of IT chiefs,
“Operational efficiency was the goal of their organization’s ERP investment.” Thus, manufacturing enterprises seeking for standalone solutions to intensify ROI and generate incremental value for their business.
Demand for on-premise ERP software solutions have surged in the recent years and will continue so to capture a greater market share. While it is expected to occupy about 57% of the market by 2020 with more cloud-based ERP, the growth and adoption of ERP in defense and aeronautical segment are expected to rise at CAGR of nearly 9%.
The core benefits of ERP realised by manufacturers at a glance.
- Brings forth better managerial capabilities of product data
- Turns complex manufacturing plans into organised plan with data accuracy and preparedness for reproduction
- Provide comprehensive applications for tracking production
- Offers enhanced control over product quality management and maintains the quality of the process chain aspects including raw materials, end products and in-process materials with inspection and testing
- Inventory management is harmonised due to standardisation of processes
Besides this assured usefulness, ERP suites are valued by the manufacturing ventures that are highly regulated industrial segments with stringent compliance for which traceability requirements is their prior concern.
Food & Beverages
ERP technology takes a great stand in the food processing industry. In food and beverages segment, there’s a good deal of physical processes, each of which is subjected to food safety rules and standards. As the products are perishable and are life-sustaining, ERP systems must take into account the different types of quality standards to affirm safety for the consumers.
While a recent study by Abeerden Group unveiled that 48% of manufacturers in the food industry consider compliance with food safety regulations as a prior concern, ERP systems are a proactive solution for them.
Being an industry that is quite cumbersome due to strict compliances and product recalls, it definitely demands for a powerful software solution wherein companies can track their products, ingredients in both the upstream and downstream. Specifically, data needs to be tracked from each point in the supply chain which will help eventually in the audit trail. This serves the real purpose of ERP solutions to firms and enterprises in the food industry. The cutting-edge benefits of ERP that make great sense to the food manufacturing businesses:
- Offer end-to-end product traceability
- Helps food businesses to control their supplier lot details
- Allows food companies to adhere to HACCP system (Hazard Analysis Critical Control Point) besides food safety regulations.
- Manages production in an innovative way with precise scheduling and control panel that is all way connected with plant floor equipments.
While quality assurance is a top concern for food manufacturing units, ERP came as a boon to them and helped them overcome ‘‘farm to fork” safety challenges. It provided them with a 360-degree view of their production and supply processes and meet safety standards to ensure that the finished products are quality oriented and minimised all the chances of costly food recall situations.
Of late, healthcare institutions are primarily emphasising on bringing fresh and high-end clinical software replacing the conventional systems.
While ERP is already a revolutionising phenomenon in the non-healthcare sectors giving businesses an upper hand in supply chain management, HR, financial and accounting, healthcare organisations are deploying it fast to meet their challenges. It helped in on-time integrations to various clinical systems and allow bi-directional flows of the data. In short, ERP made healthcare institutions more prompt at providing their services to patients and helped them rise above their competing partners.
ERP helps in keeping the health sector “healthy”. As per the words of Jacqueline Belliveau, a renowned editor at Xtelligent Media,
“In healthcare, organizations use ERP systems to eliminate financial data siloes that have traditionally separated back office functions. With an ERP system, providers can break down the walls between front-end revenue cycle management duties, such as patient access, and back-end responsibilities, including claims management.”
Hereby, ERP is great software mechanisms for organisational management that offer healthcare centres an integrated view of their crucial functions and consolidate data to facilitate the exchange of information. They streamline the overall management and curbs down costs of hospitals and health centres while rendering quality care by,
- Mechanising all manual procedures to uplift efficiency
- Gain more financial visibility for quick and informed decision-making
- Effective cost management
- Better estimation of aging of medicines and machines
While ERP solutions emerged as the mainstream tool in the health industry, investments on it also seems a prerequisite for the healthcare ventures to seamlessly drive growth, consolidations and other acquisitions.
While we are living in an era, where businesses cannot seek growth without technology, real estate is one of the definite sector that chases technology for gaining operational efficiency.
Real estate businesses are soon adopting cloud ERP software for unleashing the potential business opportunities. The progressive and aspiring owners in the real estate sector work in a challenging environment as the industry paces fast with changing economic conditions and require consistent information updates. ERP software assist companies effortlessly in streamlining their wearisome workflows, right from lead generation to final project closure.
Benefits accrued by real estate vertical from a robust ERP system.
- Flawless lead management due to better analysis of lease requirements, demand supply conditions and keeps track of deposits and tenancy checks
- With real time integration between procurement, construction, finance and sales data, it allows complete control over inventory procurement and helps in avoiding crises.
- Gathers on-time and precise data from purchase and accounting departments and provide for error-free reconciliation between all activities.
- Enables accurate project cost estimation through automation of billing and contractors payment.
- Provides the support for complaint and maintenance management to tenants.
Further, Cloud-based ERP are purposely integrated by businesses in real estate with CRM to cut down operating costs, facilitate lead management, pursue information on economic scenario for decision-making, and provide them a holistic view of their ongoing construction projects.
There’s no doubt that petrochemical industry, being one of the vast commercial sectors is faced with multifaceted and complex challenges. From ever-altering trade regulations of the country to global price fluctuations, there are many factors affecting every small to large industry players. Thus, there’s a dire need for some technology or software intervention for businesses in petrochemicals to counteract these external challenges besides helping them to have complete visibility of their massive range of activities.
Companies find difficulties in accumulating all vital data and analysing them to prepare reports for fruitful decision making. A dedicated ERP solution inevitably helps them in that. Besides covering the core functions like supply chain, material, financial management and stock control, it provides necessary information to manufacturers to help them manage their business issues and stay competitive with decision support and performance management.
Basic usefulness of ERP to petrochemical manufacturers at a glance.
- Easy risk management with advance identification of risks and preparation of contingency plans.
- Allows companies in effective management of offshore and onshore projects
- Simplifies operations in joint ventures or internal project alliances
- Gives assurance and assistance for employees training to help new recruits absorb different processes like energy exploration, monitoring or procurement.
While most of the tangible businesses are significantly benefited from ERP technology, online or eCommerce sector too is not left from its supremacy. eCommerce is seemingly the fastest growing sector in the globe and Cushla Sherlock, Head of Credit Suisse rightly mentioned once that,
“The eCommerce industry is a force that no investor can afford to ignore.”
eCommerce is clearly the future and customers seek to get best of the shopping experiences for which no eCommerce sites can ever afford disintegrated and malfunctioning backend systems. Satiating the demand of 21st-century customers does necessarily calls for right amalgamation of website’s backend operations and ERP resorts to that seamlessly. The specific eCommerce ERP modules are capable of:
- Makes sales cycles ten times faster and simple
- Enhances uniform and timely flow of communication between inter departments
- Minimises the chances of manual and data entry errors
- Helps to provide accurate shipping and product availability estimates
Thus, with ERP integration in eCommerce, long gone are the patience for rough stocks and shipping estimates, checkout with multiple clicks or the chances of product returns. Now, online retailers are empowered to speed their sales cycles and facilitate customer communication by providing timely and precise information with an affordable ERP solution.
The worth of ERP can never be understated owing to the vast spectrum of industries they cover and the fringe benefits it provides to enterprises besides streamlining the organisational functions. The efficient flow of information through disparate areas in the business from a centralised database system facilitates efficient decision-making for the management. From manufacturing to healthcare, none of the industrial sectors is cast off from the influence of ERP solutions. The multitude of benefits harnessed by businesses pretty much sums up how industry visionaries feel about ERP and the notion that businesses cannot live without them holds true. In fact, commercial enterprises got entwined with ERP technology for an undefined period. When companies were enquired whether they will be able to do without ERP, more than two-thirds of them disagreed. Thus, it comes as a no surprise that ERP is one of those technological advancements that is going to stay here for longer!