Enterprise resource planning software provides the company using it with a wealth of information that can be used to drive the organization to a higher level of profitability. This goal is usually accomplished by allowing decision-makers to hone in on specific areas of the business where inefficiencies exist and implement an improvement plan to optimize operations.
This can be related to customer service, production or bettering supply chain efforts. Streamlining and making each area more efficient, while eliminating wasteful practices, can add a significant amount of revenue to the bottom line.
The ERP platform itself can be compared to a car: It looks shiny and new inside and out, but you still need keys to make it go anywhere. Keeping this in mind, it’s important for decision-makers to remember that the most critical component of the software is the various modules that need to be installed that will deliver the information needed to make necessary changes.
Without these, an ERP software package is similar to a brand new vehicle sitting on a showroom floor. It looks good, but it’s not going to take you very far without the one necessary item needed to drive it.
How to select the appropriate ERP software modules
According to the Search Manufacturing ERP website, there is a wide range of software modules available to companies going through an installation. There are those that will allow an organization to improve their warehouse management operations, or a component that carefully monitors assets and inventory.
When going through the planning stages of an installation, it’s imperative for decision-makers to decide which areas of the business that needs to be improved the most, and then select the appropriate modules to help accomplish these goals. However, this can be a tricky proposition.
Many organizations, when working with ERP software, will select modules that they will likely never use and don’t need. They only choose them because they feel that the more robust the system is, the better. However, this strategy isn’t the most cost-effective option and can really drive up the overall price of the implementation.
“Avoid shiny object syndrome,” John Hoebler, who serves as managing director of MorganFranklin Consulting, told CIO magazine. “Instead of building rich dashboards or automating unwieldy or poorly documented processes, tackle the basics: financials, HR & payroll, supply chain processes and reporting.”
This is excellent advice as it prevents an organization from overspending and never seeing a true return on the investment into the purchase of ERP software.
Here is a list of modules that should be considered as necessary core components of an integrated ERP platform:
- CRM: Customer relationship management is a critical focus for any successful business. When clients are happy, the business thrives. When they are less than satisfied, growth can be stagnant and the company can develop a negative reputation in the marketplace. This particular module allows decision-makers to track both positive feedback and complaints in real time so that matters that need to be addressed quickly can be done in order to salvage or strengthen the relationship an organization has with its client base.
- Asset management: If a company doesn’t know what it owns and where these items can be located, turning a profit can be a difficult proposition. This particular module keeps accurate track of all the assets an organization owns, allowing decision-makers to determine if certain items need to be disposed of or upgraded in order to keep operations running smoothly.
- Order management: There will be times when customers will place an order and then follow up with the manufacturer to check on the status. This information needs to be readily available at the exact moment a client requests it. Failure in this area can lead to cancellations, which will have a negative impact on revenue generation.