Efficiency with ERP Systems

Enterprise Resource Planning (ERP) systems (Links to an external site.) use live data to create a central hub for all of a company’s records. The information from all of the business’ departments funnels into this one system for accurate reporting. Systems of the like reduce data entry errors and link actions from one department to its effect in another. The complexity of these systems requires professional setup and training for all employees that will be using them. Many companies customize ERPS systems to their needs with the help of experienced third-party programmers. ERPs are a substantial investment but can reduce extras costs caused by inefficiency and informational inaccuracy.  

I first came into contact with an EPR during a position I held at a small manufacturing company. There were many events during my tenure there that pointed to the need. However, the management team couldn’t justify the investment until we began having issues with restocking the inventory. The company started to see miscalculated projections of materials needed, which trickled to other business areas, such as sales, operations, and customer service. The root cause of the issues was traced to inaccurate reporting between departments steaming from data silos and manually entering information into each department’s systems. One inefficiency that occurred was between the sales data for customers and the company’s CRM. Our sales representatives would enter separate systems to compare a customer’s sales data and their interactions with our team, resulting in a reduced number of clients reached per day.

Another common problem we saw was between the accounting and inventory systems. Since the two systems could not be linked, each department operated independently and reported to each other, at times causing misinformation to be entered on both ends. The management team finally saw the need for an integrated system when purchases began to backorder, and customer complaints increased. Upon implementing the ERP system Acumatica, all our systems were integrated and reporting with precise information. This changed the course of the business. The sales, fulfillment, and inventory management processes began to work together, making other functions within the company like accounting more efficient. The learning curve for a system like this is significant, but Acumatica provided helpful training to ensure all employees used the ERP system correctly.

If you haven’t yet, read my blog on price elasticity within the cosmetic surgery industry.