A serious ERP system and implementation is much more than transactional recording and financial / warehouse reporting. Proper system selection and implementation throughout the corporate operations can be a success/fail factor in today's cut-throat global market.
ERP is all about control. An ERP system creates a clear view of the flow of
money, materials, resources and equipment utilization across the enterprise.
This improved communication allows you to fine-tune processes, identify and
eliminate waste, and streamline scheduling.
1. Improve Cash Flow
Cash is the oxygen of your enterprise. You want it to move fast, minimizing
collections time, improving your payment deals through careful planning of your
commercial policy and your suppliers negotiations. Keeping track of your loans
and optimizing them, surely helps as well. ERP will provide a clear view of
where your working capital is and a consistent cash flow plan, which is
paramount if you want to assist your organization to survive and grow.
2. Reduce Inventory Levels
Inventory management is a significant portion of operating cost. Inventory
consumes employee time, production capacity, and ties up valuable working
capital. ERP allows you to get a clear, across-the-enterprise picture of
inventory flow. Assessment of inventory balances allows you to decrease
materials on hand without impacting production and sales. Tracking expiration
dates or discontinued items will allow you to reduce waste.
3. Reduce Cost of Materials
ERP enables efficient supplier interactions. Proper forecasting allows for
materials ordering without costly last-minute requests and small batch runs.
Supply chain visibility allows your employees to spend less time trying to
organize and order materials. Efficient use of your ERP can even automate aspects
of ordering materials, freeing up valuable resources. And analysis of inventory
on hand allows you to spot areas where more competitive pricing may be
available.
4. Improve Production Throughput
Enterprise Resource Planning means using data and information to employ all
of your tangible and intangible assets in the most efficient and effective way
possible. ERP stores all of your processes, all of your resources availability,
all of your materials, and develops a schedule to maximize your return on
investment. From minimization of costly changeovers to “right-sized” production
runs to on-time delivery, ERP streamlines your operations. The result is improved
information flow, less waste, higher quality, and improved customer
satisfaction.
5. Reduce Labor Costs
Labor is often one of the largest portions of your costs. ERP will assist
you make the most of your labor investment. Improved forecasting ensures you do
not waste production man-hours on unnecessary product. Proper scheduling makes
the best use of your capacity, preventing product from being produced on
overtime. Indirect labor is also significantly impacted. The transparency
provided by an ERP implementation will make planning, scheduling and
procurement more efficient.
