3 clear benefits of implementing ERP

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ERP (Enterprise Resource Planning) implementation projects have a massive impact on your organization. Even if they are being executed in an efficient way, they consume a lot of effort, time and cash. There is also an opportunity cost involved; the effort, time and cash cannot simultaneously be invested in other areas of your business. So you better know ‘why you want to start that project’. It all starts with understanding the benefits and advantages of an ERP system for your business.

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We have seen a lot of ‘failed projects’, mainly due to a lack of ‘knowing why you really want to go for that project’. ‘What do you really expect to achieve?’ ‘What are the expected results?’ Here are some common examples of reasons why companies implement ERP:

  • We have to replace our legacy IT systems
  • Our competitors have implemented SAP
  • We have to go with the latest technology evolution
  • And so on …

Unfortunately, these common drivers to implement ERP systems heavily increase your chances for a failed project, or at least a big struggle. They are too generic and vague. First of all, they don’t provide you with a framework for future decision making during your implementation project. On top of that, they are not strong enough to motivate all the stakeholders involved for the long journey ahead.

KEY ERP BENEFITS AND ADVANTAGES

Based on our experiences, we can suggest a couple of better reasons to implement a new system.

  1. Scaling up your organization in an efficient way
  2. Increasing customer service and intimacy
  3. Better decision making

1. Scaling up your organization in an efficient way

Growing an organization is very exciting but can be tough. Many growing businesses have the feeling they are hitting a ‘glass ceiling’. An ERP system might definitely help to make your processes more robust and scalable. For organizations focusing on operational excellence, automating manual processes can definitely drive profitable growth.

But pay attention; implementing an ERP does not automatically make your processes more robust or scalable. This is a common mistake. Contrary, they might result in broken processes becoming even more problematic. You will only be able to achieve profitable growth when focusing on the following aspects:

• simplification and rationalization: Rather than introducing new processes and more process variants, there should be an initial focus on limiting the number of processes and process variants and on making processes more straightforward. Although the system has the potential to support just about any process or process variant, it does not mean that it should. To the contrary, an ERP implementation can be a great opportunity to reduce business complexity, and that will pay off.

• standardization: stick as much as possible to the standard processes that are already available in the ERP system. This will allow for more flexibility and improved scalability. Try to implement ‘best practices’ over your different regions and entities.

• business transformation: Is your organization ready for the transformation? If your focus is on scaling up the organization, you have to make sure to prepare for functional specialization and avoid combining too many roles/processes for execution by the same person. Try to find the right balance, but in most of the cases the ERP implementation will deliver better results if fewer people are involved in the same process and if one person covers a reduced number of processes.

Are our posts inspiring you? Sure you will be impressed by our cloud solution to accelerate ERP implementations, powered with ERP methodologies, templates and best practices. Learn how it works here.

2. Increasing customer service and intimacy

Business partner communication and collaboration is becoming the number one priority in today’s business environment. Having the capabilities to keep your business partners informed and engaged is the best way to keep them happy and ensure commitment.

Modern ERP systems can be deployed to increase customer service and intimacy in an effective way. Think about sales automation, electronic data interchange, delivery performance optimization, document generation and distribution, …

Try to be as specific as possible in defining how you want to effectively increase customer service and intimacy.

3. Better decision making, by consolidating information

Better decision making is key if you want to survive a business environment that is highly competitive and changing at a fast pace. Having the capabilities to make informed decisions is the best way to guarantee sustainable growth.

An ERP solution can help you consolidate various silos of data and information and reduce manual errors and duplication. However, this requires a higher level of organizational discipline and structure, which is often one of the most overlooked pitfalls.

YOU REALLY NEED TO KNOW ‘WHY YOU IMPLEMENT THAT ERP’!

There are two key reasons why it is that important to know ‘what you want to achieve and why is it worthwhile?’

  1. It creates a framework for efficient and effective decision making.
  2. It makes the story that motivates stakeholders through the tough journey ahead.

Make sure you have a clear and strong vision for what you want to achieve with the project, and make it more specific as you move along the project roadmap. Never forget to communicate that vision during key project milestones. This is not only valid before you start an ERP implementation. This reflection should be made for every ERP improvement project.

Are our posts inspiring you? Sure you will be impressed by our cloud solution to accelerate ERP implementations, powered with ERP methodologies, templates and best practices. Learn how it works here.

 

LEARN MORE ABOUT ERP IMPLEMENTATIONS

5 tricks to improve the speed of an ERP implementation

20 things you should know about ERP implementations

Why is implementing an ERP so challenging?

One simple way to improve your ERP skills

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