Sunday, May 22, 2022

What is ERP and why it is so popular?

ERP, also known as an enterprise resource planning system in full, is a kind of software aimed at managing critical business activities that determine the success of the development process. It covers such crucial aspects of work as financing, procurement, HR, etc. ERP is a beneficial tool for managing and running a range of pivotal processes. Nowadays, it is difficult to imagine a company that is not using ERP systems. It develops with the flow of time and adjusts to modern realities. Today most ERP are cloud based and characterized by AI technologies. 

Also read: Accountants: Get Your Accounts for Your Business Right

Why is ERP so popular?

ERP is essential for running a successful business. It can boast of numerous advantages and reasons to use such software. ERP is responsible for the integration and automation of many processes to speed up daily operations and make them run more smoothly and efficiently.

ERP makes the lives of sales managers, logistics specialists and many other people much easier. It enables accurate accounts and calculations. What’s more, thanks to EPR business owners can evaluate the current performance of the company, its vulnerabilities and strong sides. The data presented by this software is crucial for making well-informed decisions about further enterprise development. No wonder, ERP is being adopted by a growing number of businesses, reaching nearly US $72 billion.

The principles of ERP work

Enterprise resource planning consists of integrated components sharing a common data library. These elements can represent integrated business mobile applications or modules. Each ERP element covers a particular area of responsibility. However, all these modules apply to the same database to satisfy the requirements of the company.

Among the most essential points are sales, accounting, logistics, finance, and human resources. In such a way by visiting and defining a particular business operations you want to cover, you will automate and enhance them. Apart from basic and common requirements, a company owner can ask for any specific functions he or she wants.

The most popular areas covered by ERP

To understand whether your company will benefit from an enterprise resource planning we must get insight into the processes it can cover and automate. Since there are a lot of them, our team has focused only on the most commonly used ERP modules.

  • Management of human resources

ERP is widely used for managing human resources. It includes the calculation of working hours and payroll. It is also used for analyzing the efficiency of employees and forming other crucial statistics. 

  • Taking control over finance

Among the most beneficial ERP modules is an accounting and finance one. Sometimes it may be extremely challenging to take control over all money transactions, payments, and just financial activities. The business owners risk miscalculating and losing their money. ERP system also enables generation of accounting reports and traces accounts payable (AP) and receivable (AR).

  • Logistics issues

Thanks to enterprise resource planning systems it is easy to track the location and movements of goods that are being transported. What’s more, it automatically calculates the amount of products in stock houses, post offices, etc. In such a way all logistics processes become easily controlled and analyzed. It also shows any issues or problems that arise.

  • Trading

Other popular ERP modules are those used for managing sale processes. Thanks to them, the communication with potential customers is traced and lately analyzed. This data helps assess the popularity of rendered services, their tendency and targeted audience. Consequently, it influences marketing strategy as a whole and helps to boost any business. What’s more, ERP service modules are entirely beneficial for delivering personalized high-quality services to customers. Another advantage is that such enterprise resource planning components help to cover all requests from the clients and react to their claims immediately.

Drawing conclusions

Enterprise resource planning systems are really must- adopt for all companies. They not only make your life easier, but also speed up and enhance a number of business processes. By applying to ERP you can automate finance, sale, marketing, human resources, and logistics management operations. What’s more, apart from basic modules you can add some specific ones for meeting the requirements of your company.

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