6 ERP functions
7 June 2024
How STOP SA calculates optimal stock 10X faster
14 June 2024
Installing an ERP system or replacing an old computer system with modern business software should not be seen by companies as a “necessary evil” and a “compulsory expense”. Instead, it represents a great opportunity for process redesign and digital transformation with multiple benefits for different parts of the business.
What are the ERP benefits?
- Increase in revenue
- Increased productivity
- Reduction of operating costs
- Improving efficiency
- Scalability
- Enhancing business data security
- Enhanced decision-making
- Improving customer service
- Compliance with the legislation
1) Increase in revenue
Every ERP system provides management with a number of indicators so that they can quickly and easily control the profit margin for products and services. In addition, the entry of analytical data, including competitor prices, allows an immediate response to market trends, setting the optimal selling price and increasing turnover.
With demand forecasting tools and statistical analysis, the sales department can immediately identify new sales opportunities and with the right positioning, secure a larger market share.
2) Increased productivity
Automating processes eliminates errors, reduces repetitive tasks and allows employees to work on what really adds value to the business.
For example, in Soft1 ERP, the user defines the commission attribution scripts to the salespeople. The system takes these criteria into account and automatically allocates commissions to each seller when a sales document is entered under his name. So instead of an employee spending hours each week calculating salesperson pay and paying them, the process is done automatically, allowing staff to spend time evaluating sales targets and adjusting them.
3) Reduction of operating costs
ERP helps the business to reduce waste and optimise the use of its resources. The detailed recording of costs and their allocation to multiple cost centres gives a clear picture of the amount of costs and how they are allocated to the various departments of the company.
Although for most company executives an ERP system means mainly commercial management, the utilization of the other expenses module is an important tool in the hands of financial management.
4) Improving efficiency
By taking advantage of the tools offered by ERP, employees complete their tasks at higher levels of quality, improving the efficiency of the organization
The IBM Institute for Business Value (IBV) and SAP, to find out how companies are achieving both financial and ESG (Environmental, Social and Governance) goals, surveyed more than 2,125 executives from different industries around the globe. According to the responses received, all companies that outperform their competition, both in terms of financial and environmental results, use the full range of ERP functions in their processes.
5) Scalability
The most advanced ERPs on the market have great scalability capabilities, so they can be upgraded smoothly and meet all the new requirements of the company.
A business can start with the simplest version of Soft1 ERP, covering its invoicing needs. But when it increases its customer base, management becomes more difficult and risks not being able to meet quality service targets. In this phase, it can easily add the CRM module to manage its customers efficiently. While if it increases its staff, it can just as easily integrate the HRMS module to manage its human resources more effectively.
In addition, the development of custom solutions within the ERP environment is an important opportunity to extend functionality. For example, Verus+ created for Kolymbari SA an android and a web application connected in real-time with Soft1 ERP. As a result, the digitization of the production process as a whole was achieved, automating workflows and accelerating the transmission of critical information for the completion of production. In this way, Soft1 ERP offers unlimited customization possibilities, covering every specific need and helping businesses evolve their operations.
6) Enhancing operational data security
Encryption at selected points or globally, enhanced access controls, logs and backup offered by the ERP significantly increase the security of the organization’s sensitive data. Data leakage and recovery from potential disaster are often not highlighted as high risk factors by companies. However, according to the Kaspersky study, the average cost of recovering from a security breach of a company’s data ranges from $86.5 thousand for SMEs to $861 thousand for large companies. Furthermore, damage to the reputation and downtime of parts of the business is something that cannot be valued financially but certainly has a significant impact on the growth of the organisation.
Soft1 ERP, in addition to the above, offers the possibility of hosting in Microsoft’s Azure cloud infrastructure, significantly increasing security and ensuring business compliance with standards (such as ISO 27001) and regulatory frameworks (such as GDPR).
7) Enhanced decision-making
The sophisticated reporting and statistical tools offered by ERP contribute to the optimal use of information and better decision-making.
For example, the CFO of the company can better manage cash resources by using the CashFlow forecast, the CEO can adjust his strategy by looking at the aggregated picture of the company and its performance through KPIs, while the HR manager can make decisions on the increase plan by evaluating the staff.
8) Improving customer service
Customer relationship management capabilities help the business to answer their questions faster, respond better to their demands, and increase their satisfaction.
For example, in the CRM module of Soft1, you can keep all the data about potential customers. That way, when you contact them again, you’ll have an excellent understanding of their needs and won’t repeat questions you’ve already asked, increasing your chances of converting them into customers.
9) Compliance with legislation
ERP systems and their individual applications incorporate functions that ensure the company’s compliance with legislation and significantly reduce the chances of fines and penalties.
The Soft1 HRMS module comprehensively covers the needs of the mandatory digital job card, since it immediately transmits the recording data to ERGANI II and maintains them for 10 years, in accordance with the requirements of the law. At the same time, it offers powerful monitoring and alerting tools, minimising the chances of false hits. Thus, by using the application, the company ensures its compliance with labour law.
Similarly, the supply chain module addresses the need for mandatory electronic invoicing with the public sector, simplifying the issuing of invoices and integrating invoicing with the PEPPOL network.
In order for a company to reap the full benefits of ERP, it is critical to choose the right partner. The partner should focus mainly on the analysis and redesign of the company’s processes, using ERP as a vehicle. ERP projects that try to adapt the operation of the company to the capabilities of ERP usually end in failure. At Verus+, we implement customized solutions after we have defined the digital transformation strategy together with the client. Contact us to evolve your business operations with Business Central or Soft1 ERP.
