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blog | June 18, 2019

Benefits of ERP – Advantages and Disadvantages of Enterprise Resource Planning

Deciding whether or not your business should take on an ERP software can be an overwhelming decision, especially if it is your first time implementing major software. You may...

By Wayne Wedell

Deciding whether or not your business should take on an ERP software can be an overwhelming decision, especially if it is your first time implementing major software. You may think that operating without ERP can be done, but if you want to see a positive change in business and experience overall growth, it is important to take the necessary steps in order to see the benefits of ERP software. So is investing and implementing ERP software worth your time? We say yes, because with implementing this software comes major benefits that you don’t want to miss out on.

There are many benefits of manufacturing ERP software, which include improved productivity, increased efficiencies, decreased costs and streamlined processes. Let’s look at 15 of the most common benefits of enterprise resource planning systems that companies have reported after implementation.

Benefits of ERP Software Infographic

Why is ERP Important?

The importance of ERP revolves around what it can do for your business. ERP manages a number of business functions through streamlining and automating daily business operations. The software creates a leaner and accurate operation and provides a complete, 360 view into the ins and outs of your business. With the software, businesses are able to improve both user efficiency and productivity, becoming agile which improves customer service.

15 Benefits of ERP Software

See below for primary ERP benefits when implementing a robust ERP system:

  1. Competitive Advantage

    It’s true that ERP software requires a major investment, but there’s also an even bigger cost in not making the investment. While some manufacturers choose to stick to the tried and true methods of the past, others seek technology solutions. With so many enterprise resource planning advantages the software provides, users can see improvements within multiple departments. Implementing the software helps to keep you ahead of the competition because you no longer run the risk of making costly business mistakes, which could place you behind the pack instead of ahead. Manufacturers cannot afford to put off an ERP implementation while their competition invests in ERP and starts reaping the many benefits we’ll touch on below.

  2. Improved Process Efficiency

    An ERP platform eliminates repetitive processes and greatly reduces the need to manually enter information, which not only improves user productivity, but it eliminates the possibility of inaccurate data which could lead to making costly business mistakes. The benefits of implementing an ERP system in an organization will also improve daily business activities by streamlining business processes, which makes it easier and more efficient for companies to collect data, no matter what department they’re working in. Think of ERP as an extra hand and brain, designed to keep businesses on track, noticing every detail and making work life easier and more efficient, from software users down to its customers

  3. Accurate Forecasting

    Enterprise resource planning software gives your users, and especially managers, the tools they need to create more accurate forecasts. This helps software users, and businesses as a whole, think ahead and properly plan what they need from inventory and sales down to financials and customer service. With stronger forecasting, businesses can effectively decrease business costs, which saves money as well as become an more overall proactive unit. Since the information within ERP is as accurate as possible, updating in real time, businesses can make realistic estimates and more effective forecasts.

  4. Department Collaboration

    Nobody wants to run a siloed business with each department functioning separate from the other. Collaboration between departments is a crucial and often necessary part of the business, especially because business projects often involve more than just one department. With the data entered into your ERP tool being centralized and consistent, there’s no reason why departments can’t work together, sharing information and collaborating whenever it is needed. The software also touches on almost every aspect of a business, thus naturally encouraging collaborative, interdepartmental efforts. The beauty of ERP software is that it updates in real time, so no matter if you are using ERP software in the morning, afternoon or from a remote location, the opportunity to communicate, share information and use data is always availble and accurate.

  5. Scalable Resource

    Did you know? Structured ERP systems allow the addition of new users and functions to grow the initially implemented solution over time. No matter how big or small your business is ERP grows with it, being able to occupancy new users and new rounds of data whenever your business is ready to expand. There is no worry about whether you will need a brand new system once a new user or two needs to be added, simply make sure that the enterprise solution that you choose is able to grow with your business because ERP should be able to facilitate that growth.

  6. Integrated Information

    Enterprise resource planning software acts as a central hub for all of the important information that your business and the departments within it need to maintain daily business practices and operations. No more issues with data spread across separate databases; all information will be housed in a single location. This means you can integrate platforms like your CRM software with your ERP software, keeping data consistent, accurate, and unique. Know your customer, their orders, and your inventory, all in one place. There is also no need to worry about whether the information that you are using from the system is accurate, since it is updated in real time across the board. This improves your data accuracy, which eliminates making potential business mistakes with false data and analytics.

  7. Cost Savings

    With every business, you want to be smart with your financials and avoid making costly mistakes that could hurt your business in the end. With one source of accurate, real-time information, enterprise resource planning software reduces administrative and operations costs, allows businesses to utilize money in other, much needed areas. It allows manufacturers to proactively manage operations, prevents disruptions and delays, breaks up information logjams and helps users make decisions more quickly. If you’ve chosen the right solution for your business, and the right vendor who meets your needs, you’re bound to see a powerful ROI. ERP software is available to help you become smarter about saving and spending when necessary.

  8. Streamlined Processes

    As manufacturers grow, their operations become more and more complex, which unfortunately increases the opportunity for costly mistakes to be made. Manufacturing software automates business operations cross-departmentally, providing accurate, real-time information to everyone utilizing the solution, all while eliminating manual duty, which often has the potential to lead to errors. ERP increases efficiency and productivity by helping users navigate complex processes, preventing data re-entry, and improving functions such as production, order completion and delivery. Streamlined, efficient processes throughout.

  9. Mobility

    An enterprise resource planning advantage is the software’s ability to make users the center of its attention, providing deployment styles that will give on the road sales reps the same opportunities as in-office users to use ERP whenever and wherever they need. With WorkWise ERP software, users have access to a centralized database from anywhere you work and from different devices including your laptop, tablet or cell phone. The adaptability of a ERP software is crucial, as it increases productivity and makes information accessible no matter where you are. Do you often have time sensitive projects that have hard deadlines? Use ERP at home, in the office, wherever, through our mobile-friendly solution and application.

  10. Customized Reporting

    ERP software helps make reporting easier and more customizable, fit to meet all of your needs. With improved reporting capabilities, your company can respond to complex data requests more easily. This improves productivity, completes process faster and helps to close out projects without large wait times in between. Users can also run their own reports without relying on help from IT, saving your users time to use toward other projects.

  11. Increased Productivity

    Save time and increase productivity levels. Sound too good to be true? It’s not with ERP software’s automation and streamlining capabilities. Often times, when tedious tasks take up much needed business time, there can be a delay in production, which can effect your business and even the customer service experience. By having redundant processes automated, users have more time to work on other time sensitive, pressing projects and tasks that may truly require more of your attention and time. Users will also be able to work easier since the solution was designed for ease-of-use. ERP was designed with ease of use in mind, as well as giving business a break from long winded tasks, allowing you to shift your focus toward other matters.

  12. Regulatory Compliance

    A benefit of ERP software, which often times goes unnoticed, is how it ties well into regulatory compliance within the manufacturing industry. Powerful ERP platforms are designed to keep track of regulations within the industry and monitor changes in compliance. This allows users, and businesses at large, to stay abreast with laws, regulations, guidelines and specifications as it relates to business processes.

  13. Flexible Systems

    Modern ERP software platforms are robust, flexible, and configurable. They are not a one-size-fits-all proposition but can be tailored to the unique needs of a business. ERP software can adapt to the ever-changing needs of a growing business, ensuring you won’t have to buy a new solution once your needs change or your business grows. When implementing the ERP software of your choice, it is important to make sure that you can customize applications and suits, so that your system has every function needed in order to assist with daily business operations. Make sure that your ERP system can grow as your business grows, allowing you to add new users when and if needed. ERP’s flexibility also goes into how it is implementing, which can be done in either your choice of the cloud or on-premise.

  14. Customer Service

    It’s easier to provide high-quality customer service using an enterprise solution, especially when you’re using one as well-equipped as WorkWise ERP. Sales and customer service people can interact with customers better and improve relationships with them through faster, more accurate access to customers’ information and history. You’ll also have access to marketing automation and contact center software, ensuring your customers are being interacted with consistently. Additional features including lead scoring, which helps with searching for leads to move through the sales pipeline, social media monitoring and email campaigning, which allows users to track the status of their campaigns. WorkWise ERP also integrates with CRM, which is designed to strengthen the relationship between a business and its customers.

  15. Data Reliability

    ERP provides reliable data that can be accessed from different locations (if implemented in the cloud) and through multiple devices including tablets and smartphones. With the ability to update in real time, ERP improves data accuracy and consistency. With this, users can ensure that all data and analytics are safe to use, without running the risk of errors. ERP user data can also have additional security through firewalls and built-in protection resources. Improved security removes the risk of important business information getting into the hands of the wrong person. Both accuracy and safety are key with WorkWise ERP software.

    Ready to learn more? Our ERP solution experts are ready and willing to answer all your questions and help you get started on selecting the right solution for your business.

The 4 Disadvantages of ERP Software

With so many benefits of ERP software, you may be ready to start comparing systems. However, it’s equally as important to understand the disadvantages of this type of software to make sure ERP is the right system for your business. Let’s look at four of the most common disadvantages of ERP that companies have reported after implementation.

  1. Cost of ERP: Depending on how much your business can spend budget-wise, a disadvantage of ERP can be the pricing. With most ERP solutions, there are multiple fees that are applied, which can lead to higher costs. From licenses to upfront cost, implementation and recurring potential monthly fees, some ERP solutions may be too expensive. Researching ERP solutions within your price point can help spare you from spending more money than originally anticipated.
  2. ERP Success Depending on Software Experience: If you choose to forgo the training process or if your chosen ERP vendor does not offer ERP software training, that can put your entire workforce in a vulnerable position. Not knowing exactly how the software works means there is a greater risk of making costly mistakes and spending long lengths of time trying to make the software work for you, which leads to a lack of productivity. Finding a vendor that offers ERP training will ultimately make the software easier to use and helps to build a knowledgeable workforce.
  3. Not Purchasing a Customizable System: It is important to purchase an ERP solution that has all of the suites, modules and applications that will help your business with its daily activities and processes. Spending money on a system that does not have all of the bells and whistles that your business needs is essentially a bad investment. Businesses also want to make sure that your ERP software doesn’t include more than what you need, so that applications aren’t sitting idle by with no use to your business – that is a potential waste of company money.
  4. ERP Resistance: It may take some time for employees to get used to a new ERP software, which can lead to it not being used to its full extent. Other members of the workforce may also struggle with placing information into the software, which makes it hard for ERP software to truly serve all departments that make up a business.

Why You Should Invest in ERP Software

Ultimately, even with these disadvantages, ERP software is still a key ingredient toward building a successful business. The benefits of implementing an ERP system in your organization outweighs the negatives because ERP gives your company a competitive and financial boost while improving company productivity, collaboration and communication. The upside to the listed disadvantages is that with thorough research, your business can avoid making any of these mistakes.




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