Nowadays, ERP software is a popular IT solution for multiple industries. This system helps companies optimize their core day-to-day business operations and make them run more effectively. Enterprise Resource Planning takes place in numerous business areas, including finances, accounting, sales, supply chain management, human resources, etc. However, despite the promising benefits of this software, ERP isn’t suitable for all organizations. In this article, we’ll walk you through the definition of ERP, and find out what types of companies this software suits the most.
What is Enterprise Resource Planning?
An ERP system is associated with a platform that provides database centralization, business operation automation, and streamlining core processes within a company. Once all the data is centralized, your employees are now free from the responsibility to manage day-to-day business activities that can significantly affect the overall business performance.
Most ERP software includes the following features – inventory management, industrial production, customer relationship management in accounting, and analytical and reporting tools for human resources.
There are on-premises and cloud-based ERP solutions. In cloud ERP, a company pays a third-party vendor for necessary resources and system deployment, maintenance, and upgrading. This solution is highly customizable and scalable. On the other hand, on-premises ERP takes place on its servers while an IT staff is responsible for software management.
What are businesses likely to select ERP over other systems?
Cloud-based manufacturing ERP software was widely used for a manufacturing sphere, although multiple other modern industries can leverage this software. Businesses engaged in education, real estate, health care, government, retail and wholesale can consider deploying ERP software. This system allows businesses to run their infrastructures more efficiently and integrate all the basic business processes.
It might be a working strategy if you doubt whether cloud-based ERP software for small businesses is suitable enough. Cloud ERP stands for lower IT costs since it is on a monthly subscription that can reduce any upfront costs. However, other kinds of Enterprise Resource Planning systems and apps are relatively expensive, so small to medium-sized businesses can’t afford to deploy this software solution.
It is worth mentioning that customizable cloud-based ERP software suits particular business cases. For instance, if your IT team spends too much time dealing with non-manual tasks or a company works with multiple suppliers from different regions, or you want to have fast and easy access to data to make decisions quickly, or you can’t monitor an inventory level every day or your workers cannot communicate and share data across a company or you don’t have access to information when you are outside of an office or headquarter, etc. If any of the previous clauses are all about your current business situation, then ERP seems like your best bet. Nonetheless, unless you don’t opt for cloud-based ERP software for professional services, be ready to spend significant amounts of money.