What company has a successful ERP system?

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Of the various systems available, enterprise resource planning (ERP) systems are perhaps the most broadly applicable across the many parts of a company. These stand to improve productivity, organization and efficiency for all sorts of businesses. Read ahead to learn more about ERP software and to see current examples of these powerful systems.

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What Is an ERP System?

ERP stands for “enterprise resource planning” and describes the process of analyzing business functions for increased efficiency and productivity. Companies have long sought to streamline business processes through the consolidation of internal data, but early versions of ERP were “siloed” systems that worked only for one department or component of a business. While still commonly encountered today, these don’t tend to integrate easily with other software within the same company, nor do they provide a good platform for new management technology to be built in.

More recently, the use of centralized software in the workplace has revolutionized the way these goals are carried out by integrating once-separate systems. As much as ever, ERP remains a data-driven approach to consolidating and improving business functions. Modern systems, however, afford a greater degree of simplicity, organization and automation to the employees and business leaders responsible for day-to-day operations.

What Is ERP Software?

At the core of any ERP system is a central database that’s shared by the many disparate elements of a company. Rather than having separate data collection and management programs for each department—one for sales, one for inventory management, another for production, and so on—an ERP system provides a single hub for it all.

Not only does this mean that data can be more easily accessed, it also consolidates where new data is stored. This creates one “true” source of information for the whole enterprise. This type of system clearly improves experiences for humans, but the nature of ERP systems also makes them friendly to new software that a company may want to implement in the future.

Who Uses ERP Systems?

ERP systems are not just for massive companies—though they have become particularly essential to large, sprawling organizations. Small businesses, including independent retailers and services, may also find this type of software to provide valuable support.

ERP systems can be used by any business that strives for accurate data collection, including all businesses that wish to track categories such as sales, inventory or finances. ERP is especially popular in manufacturing and production-based fields but is now used in areas as wide-ranging as healthcare, e-commerce and nonprofit work.

How ERP Systems Work

With a consolidated database as its foundation, ERP systems can be built out to accomplish a seemingly limitless variety of management and tracking functions. Doing so still requires technical know-how from a third-party ERP system provider or experienced internal staff, but it’s much, much easier for the company at large than the siloed management software systems of the past.

Employees usually interact with an ERP system through a centralized dashboard connected to the core database. This puts access to real-time information from various parts of the company at employee fingertips any time it’s needed. ERP systems may operate and store information on-site or, increasingly, in the cloud.

Benefits of an ERP System

Increased Efficiency and Automation

ERP systems are a boon for business efficiency on several fronts. For one, the ease of navigating a centrally organized system means access to information is that much simpler. There’s no need to toggle between different programs that each operate in a unique way and no need for the painstaking reformatting of data for it to be transferable among operations.

On another front, ERP systems are designed to support automation functions wherever possible, meaning that once-laborious undertakings such as performing reporting tasks and analytics can be completed with a few clicks. A wide variety of business operations are made more efficient by the increased flexibility in applying computing power to all corners of a company. Needless to say, these increases in efficiency can translate directly into reduced operational costs.

Increased Accuracy

Hand in hand with the enhanced organization of an ERP system is the improved accuracy in data management it brings to the table. Consolidating all data management under the purview of a single system reduces the risk of human and technological errors, minimizing discrepancies in cross-departmental reporting. While this may seem like a simple step, it can be impactful in avoiding costly mistakes and even costlier troubleshooting.

Reduction of Duplicates

One area in which ERP systems particularly excel is detecting duplicate items of many sorts, which similarly reduces the opportunities for things to go wrong. Naturally, this applies to duplicates within a single department, such as duplicate communication channels to the same client within a sales team or duplicate payments to suppliers. But importantly, ERP systems also eliminate the need for duplicate sources of the same information to be managed in different silos. There’s no risk of conflicting information when one data set has been updated more recently than another, for example, or when data categorization is performed differently by separate departments.

Better Interdepartmental Collaboration

ERP provides a software infrastructure to link disparate elements of a company, but perhaps less appreciated is the connection this facilitates among a company’s various human components. Because departments share similar interfaces when interacting with an ERP system and can see each other’s data, one group never has to be totally in the dark about what’s going on with another side of the company. When managers from a sales department and a marketing department, for example, can observe the same figures and trends, opportunities are enhanced for collaboration and cross-departmental workflow optimization.

Improved Data Security

ERP systems’ broad access and high degree of information-sharing may raise valid questions about system security. (Intuitively, the separately accessed and redundant information storage systems of a siloed approach appear less vulnerable to malicious activity or other security risks.) With ERP systems, the opposite is often true—due in part to the lengths developers go to when building in security measures.

Firewalls and other restrictions keep sensitive information and vulnerable points of access limited to the right people, though they’re applied in such a way that information still flows freely when it needs to. When unauthorized activity is detected, all necessary parties across a company can know right away, rather than a red flag reaching only the department or area where the breach originated.

Easier Regulatory Compliance

Regulatory compliance can be a major headache for businesses across many different industries. Not only is a company responsible for making sure all its various components are in compliance, it may also have to track compliance measures and report proof of adherence. ERP systems can help by automating internal compliance-monitoring tasks and reporting compliance status in real time with a high degree of accuracy.

ERP systems also make it easier to implement changes when new regulations or reporting burdens arise. The customizable nature affords a company great flexibility in this regard as industry standards evolve. Additionally, when new regulations change some aspect of business procedures, a company using an ERP system only has one body of software to adapt. This is contrasted with having to address a variety of unique systems scattered throughout a company.

Better Integration With New Software

One of the best qualities of an ERP system is that it’s designed to be built upon. Older styles of business management software are often built for one specific purpose and no other. These are likely to have a low degree of compatibility with other software tools that perform mostly unrelated functions.

By contrast, an ERP system provides the foundation for a variety of other types of software, including third-party applications. An ERP system doesn’t only solve the compatibility issue—it also supports and enhances new systems with its core database. What’s more, it can provide a framework for expanding access to the new software across a company. ERP systems are commonly integrated with material resource planning (MRP) systems, point-of-sale (POS) systems, supply chain management (SCM) systems and customer relationship management (CRM) systems, to name just a few examples.

Popular ERP Systems

1. Microsoft Dynamics 365

Microsoft’s suite of Dynamics 365 software offers a variety of ERP options geared toward a broad range of business areas. The software is notable for its use of AI to provide insight into optimizing business operations. Microsoft bills its ERP systems as an excellent option for businesses that currently lack modern ERP software and still need to “break down” a siloed approach.

Dynamics 365 integrates seamlessly with LinkedIn Sales Navigator, a major plus for businesses already accustomed to this service, as they can continue using it without the need to implement a separate ERP tool. As part of its Dynamics line, Microsoft also offers CRM software that effortlessly integrates with its broader ERP systems. These features make Dynamics 365 a worthy consideration for businesses that interact heavily with customers and place a high value on solidifying customer relationships.

2. SYSPRO ERP

This ERP system is a popular choice for the manufacturing industry, as it’s noted particularly for its warehouse and inventory management capabilities. It’s well suited for the heavy demands of working with lots of other automated systems in production areas. SYSPRO boasts decades of industry experience, significant international reach and a 98% customer retention rate.

SYSPRO ERP stands out with a couple of interesting features: one is its “smart manufacturing” program, which relies on web-connected “smart platforms” that enhance software automation specifically in a factory setting. Another is its use of bots, or what it apparently unironically calls “digital citizens,” to help automate a company’s systems with minimal disruption to existing work patterns.

3. Odoo

Businesses of any size that deal heavily in sales and customer interactions might want to consider Odoo. Similar to Microsoft’s Dynamic 365 systems, Odoo offers a built-in CRM system, meaning its customers can look no further for third-party CRM software once using Odoo. The system also features POS and e-commerce tools that translate to effortless software integrations for retailers and vendors.

Odoo’s software relies on an open source model, affording its suite of applications a high degree of compatibility and ensuring easy integrations. This means developments from third-party sources can always reach their maximum potential within the Odoo environment.

4. Oracle NetSuite ERP

This industry-leading ERP system bills itself as the world’s “most trusted” cloud-based ERP software. NetSuite may be able to claim the title of the most deployed cloud ERP solution with over 32,000 companies as customers. NetSuite has built up as much direct experience with cloud-based ERP software as any developer out there, with roots in some of the earliest examples of cloud applications and ERP systems.

Now owned by Oracle, the company has retained its industry leader status and solidified its popularity through generalization. Its software products satisfy virtually every ERP need for companies in all sorts of industries. NetSuite ERP uses the model of a basic, core platform (covered by an annual licensing fee) with optional add-on modules. While the suite as a whole aims to provide an all-in-one solution, the à la carte options mean users are still paying only for the tools they need.

5. Brahmin Solutions

ERP software from Brahmin Solutions excels at large-scale, real-time inventory management, making it a worthwhile consideration for bigger retailers, wholesalers and distributors. Users rely on its ability to gracefully integrate the management of a distribution system with multiple sales channels and warehouses.

Brahmin Solutions is notable for integrating an expiration date tracking function designed for businesses handling perishable goods and other time-sensitive materials. This not only lets users track impending deadlines but also provides support for strategizing when to move what for maximum profit. The software is also noted for its thoughtful and comprehensive reporting systems.

6. SAP Business ByDesign

This cloud-based ERP system from SAP SE is designed with small to medium-sized companies and subsidiary businesses in mind. Business ByDesign’s popularity in this area is backed up by the fact that it’s deployed in nearly 150 countries. As a result, it’s grown to incorporate 11 other languages beyond English, making it a fitting choice for companies with international operations.

SAP’s Business ByDesign software does it all, with tools in areas as varied as grant management, supplier relationship management and executive support. A set of “prepackaged integrations” makes third-party applications exceptionally easy to build in.

7. Acumatica Cloud ERP

Acumatica’s Cloud ERP software brings an accounting-focused ERP solution to companies in search of powerful finance management tools. While it offers solutions for a variety of ERP needs, it’s particularly strong in its general ledger accounting and inventory management functions.

Along with a number of the examples listed here, the product is a software-as-a-service application licensed on a subscription basis and can be deployed both on-premises or via the cloud. The company’s unusual pricing structure makes estimating the applicable licensing costs more difficult than is the case with many of its peers.

8. Epicor ERP Systems

Epicor scraps the one-size-fits-all theory for EPR solutions, eschewing the popular model that builds optional add-ons atop a single generic base system. Instead, the company has a menu of distinct, hyper-specific ERP systems that each offer a tailor-fit solution to the ERP needs of a single industry. The company makes a point of addressing the needs of small, midsized and global businesses alike.

Examples of Epicor’s industry-tailored offerings include Epicor BisTrack for building materials businesses, Epicor Eagle for independent retailers, Epicor Kinetic for manufacturers and Epicor Eclipse for electrical, HVAC, plumbing and PVF businesses. Also offered are the aptly named Epicor LumberTrack, Epicor CMS Automotive and Epicor Decor Fusion (for paint and decor retailers), among other options.

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Bottom Line

Our brief list of ERP system examples aims to show the variety of products and service models available in 2022. That said, we’ve barely scratched the surface; scores of further options come in a variety of shapes and sizes, ensuring virtually any business can find the right fit. With all the possibilities, it’s a rare company that won’t stand to benefit from an ERP system.

Frequently Asked Questions (FAQs Dropdown)

Are ERP systems for small businesses?

Definitely. While business management only increases in complexity as a company grows, many smaller businesses still find ERP software to be essential in 2022. Even local, mom-and-pop businesses still juggle a variety of business elements such as accounting, inventory management, payroll and sales. Of any type of business, small ones likely have the least bandwidth to devote to analyzing and optimizing these various elements, making them a good candidate for an ERP system.

Why are ERP systems important?

ERP systems serve as “air traffic control” for business management, centralizing the data and analytics that power a successful, modern enterprise. Without an ERP system, departments within a company tend to build up separate data management structures and software systems, each one addressing a different facet of business operations in what’s called a “siloed” or “unintegrated” approach. Alternatively, ERP systems provide a consolidated, streamlined platform through which all parts of a company can easily share information and develop company-wide solutions.

How do I compare ERP systems?

Prospective ERP system users must first decide if they want on-site or cloud-based software. There are also several different product structures to compare: a one-size-fits-all suite offering the broadest array of tools, a generic base system with à la carte add-ons or an industry-specific system designed around particular anticipated needs. Before looking for a price tag, compare pricing structures; ERP systems may be treated as a renewable subscription service, a perpetually licensed software product or a one-time, pay-upfront installation. Often overlooked, the size and nature of the software provider itself can inform what the system implementation process will be like and what further support will be provided.

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