Deciding to implement a new ERP system shouldn’t be a big decision. It’s well accepted that ERP software advantages drive long term productivity and improved decision making. So why do some companies hesitate to pull the trigger when contemplating a new ERP system?
Doubts about ERP are completely justified. Not every installation goes according to plan, and cost over runs aren’t uncommon. In addition, a complex implementation can take a half year or more to fully integrate into the company’s processes.
But despite some potential issues, ERP remains the best way for companies to generate long term productivity gains, and improved resource allocation decisions. These gains stem from better application of available data and automation.
ERP systems combine data that is gathered from every division of the company’s work processes. Built in analytics packages enable operating officers to then process the available information and spot inefficiencies and areas for improvement. This is a vast improvement on manual systems where data is fragmented across company divisions.
Productivity gains are also seen as ERP facilitates automation for tasks that were previously generated manually. For example, client information like delivery details are shared across systems from the sales module, through production, and into delivery and invoicing. By reducing the number of manual touch points there is less activity required and few opportunities for human error.
The infographic below shows how quickly ERP software is able to demonstrate a ROI for companies. Companies see a meaningful degree of the total expected improvements in as few as nine months. This strongly suggests that the pay-back period for ERP is short enough that companies would be well advised to seriously consider adding an ERP system to manage their internal processes.
Infographic provided courtesy of Notable