Implementing ERP Within a Company Also Comes With a Need For a Cultural Change

Recently there appears to be an increased amount of interest in Enterprise Resource Planning (ERP). Originally adopted by manufacturing organizations, its main focus was for the management and control of inventory. Since then the functional scope of ERP solutions has grown, and as a result so have the benefits and adoption by other industry verticals within the wholesale and distribution segment, including those within small and medium enterprises (SMEs).

Typically organizations juggle several different business applications to manage the intricacies of their business. But now businesses understand that they need to stop wasting resources managing these multiple "silo" systems and improve visibility for better decision making via a single centralized seamless system.

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Most ERP solutions contain a range of modules to improve a variety of back-office functions, including:

- Financials & Accounting: includes functionality such as general ledger, cash management, accounts payable and receivable, and fixed asset management.

- Time & billing: includes features for billing/invoicing, time and expense management, and Project/Job monitoring.

- Supply Chain Management: includes management around Inventory and Order Fulfillment.

- Employee Management and Productivity: Human Resource Management, Employee Activity Management and Administration.

At a high-level some benefits that can be expected from implementing an ERP system includes:

- Improve decision making & strategic planning.

- Improve productivity with greater visibility and more automated back-office processes.

- Ensure accountability and compliance with auditable accounting.

- Reduce Operating Cost.

- Facilitate day to day management.

- Eliminate data silos by creating a single, centralized repository of timely, accurate business data.

- Enable more effective resource allocation and management.

Whilst these benefits mentioned are significant they are only true benefits to a business if the ERP model is a good fit for the company. A particularly good fit is for companies that need to formalize their business processes and activates across multiple departments. These companies are generally trying to deal with multiple versions of the truth across the business due to their disparate systems. This prevents managers from making good business decisions. An ERP solution can help enforce good business processes and consolidate the information to provide an accurate cross departmental picture of the "state of the nation".

When considering an ERP solution it is advisable to consider a single vendor solution that provides the flexibility and modularity of adopting the different ERP functional areas. Implementing ERP within a company also comes with a need for a cultural change within the organization. A 'lets do it all now', otherwise known as a 'big bag' approach can be a far too overwhelming transition and difficult to manage. Just like any software implementation the solution will only be as good as the people that use it so user adoption is critical. When evaluating ERP solutions it is just as important to consider the quality of professional services provided by the vendor just as much as the core solution capabilities. The successful delivery and adoption of an ERP into a company will enable the solution to perform to its full potential and provide great results.

Implementing ERP Within a Company Also Comes With a Need For a Cultural Change

For an earlier article written by Hugh McInnes on the subject of CRM [ http://www.netsuite.com.au/portal/au/home.shtml ] please visit his author page.

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