The decision to purchase new enterprise resource planning system (ERP) once was a tough one. On the one hand, a new ERP solution brings dozens of tangible and intangible benefits to an organization. On the other hand, ERP rollouts used to cost a lot of money and time—it was the definition of a big IT project.
With the advent of cloud-based ERP, however, the decision has gotten a lot easier; cloud ERP is a lot more cost-effective than previous ERP rollouts because all the technology is hosted and maintained by the ERP provider, and there’s less up-front costs. It also requires less time for implementation, because businesses can start with best practices and preconfigured, prepackaged ERP solutions for their industry.
This makes a new ERP system a smart company initiative. Here are 10 of the many reasons why you should consider a new cloud-based ERP system for your company.
Cost Savings and Greater Efficiency. Process automation within the system reduces time, effort and resources spent on daily, repetitive tasks, freeing up employees to focus on more meaningful work. Cloud ERP also eliminates redundant effort and promotes the adoption of industry best practices on a company-wide level to further boost productivity, and unification of business software cuts down on IT-related expenses.
Better Supply Chain Management. Cloud-based ERP can greatly improve a supply chain by linking supplier systems, automating key functions, and boosting responsiveness. This can lead to better demand forecasting, precise inventory management, efficient procurement and opportunities both for cost reduction and production innovation.
Improved Data Quality and Accessibility. As a single source for all business data, often collected, consolidated, organized and analyzed through automation, cloud ERP systems improve data accuracy and reliability. Fine-grained access permissions can be set by user and job function, too, controlling data accessibility precisely so employees see everything that is needed to perform their job function and nothing else.
Increased Automation. Business processes can be linked and automated because all data flows into a single system or record. Sales orders can automatically flow into the financial system without manual re-keying, for instance, and your ERP system can trigger both a work order and an inventory check.
Reduced inventory and stock obsolescence. With complete, real-time visibility over all aspects of operations, including those with suppliers and customers, inventory levels can be refined and managed with greater precision. Increased tracking from greater operational visibility can also cut down on stock obsolescence and other wastage.
Easier Reporting and Planning. Reports can be generated automatically for any part of the business, including financial, sales, operational, inventory, procurement, administrative and elsewhere. Analytics engines within cloud ERP systems also can analyze operational data and deliver predictions for improved planning and forecasting.
Enterprise-Wide Integration. Cloud ERP systems integrate various functions and business processes across an organization and store them in a single database. This enables employees in different divisions to use the same data for different needs. It also unifies operations. An example of this unification is having a new order initiate a credit check, check product availability, update a distribution schedule and send an invoice.
Standardized and Simplified Business Processes. Because systems and data are linked between departments, cloud ERP systems simplify business processes and bring greater synergy across an organization through standardization. Businesses also benefit from best practices that are built into the system, focusing on differentiating elements instead of reinventing standard processes that are uniform across an industry.
More Complete Organizational Visibility. With all business activity stored and accessed through a single system, businesses greatly improve transparency and operational visibility. Data access logging, precise worker output, machine failure rates and Inventory levels and production output can be monitored on a daily basis or even in real-time.
Better Regulatory and Security Compliance. Cloud ERP facilitates regulatory and security compliance processes by combining secure and validated data with built-in reporting and tracking capabilities. It also assists with producing information and spotting exceptions around federal, state and local regulatory requirements.
More than an IT Project
Putting a new ERP system in place is more than an IT project; it is company-wide strategic initiative for digital transformation and improved operational efficiency. That’s because cloud ERP drives business process improvement and connects all data and systems within a business, making it less about technology and more about business efficiency and improved operations.
Tech-savvy business leaders have long understood the value of a new ERP system. The limiting factor always was the cost and complexity of the rollout, especially for small and medium-sized businesses. Cloud ERP changes all that, though, by making ERP rollout faster and less costly. There’s now a lot less reasons for delaying the move—while the list of advantages from ERP keeps getting longer as the technology evolves.
For everything you need to know about cloud ERP as a non-IT executive, check out our free guide, Understanding Cloud ERP.