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Choosing ERP system

Organizations want consistency. All our customers are talking about consistency, more logic and coherence as priority results for ERP implementation. Decision for ERP system is coming with business growth when managers more and more catch the idea of smart data management and necessity for data centralization.

Decision making process for ERP implementation [this link directs to “Choose a New ERP System”] is not an easy one. Judgments inside the company can vary a great deal from one manager to another. ERP systems market is offering many solutions and it takes time to understand, what does the company really needs taking inconsideration business needs, budget and time. As this type of decisions are low-frequency decisions the process of decision-making becomes more complex more information the company is getting about the different systems and possibilities.

“We spent three months for market analysis choosing ERP system until we got one important idea that we may rely only on ERP that proved its stability and data protection through time and innovations” – explains our client, CIO of the chain of luxury shops in US. “We really do not have time for experiments and draft solutions, so we needed something reliable and proved like SAP Business One”.

Sometimes companies spend an enormous amount of efforts for choosing and implementing ERP system but are not satisfied with return on it. In the majority of cases it happens due lack of understanding, how ERP may help in growing and optimizing business processes. ERP system does not contribute to business growth until all company’s employees have a strong commitment to work with its tools and data management possibilities. People tend to revert to old ways of doing things, and performance does not improve.

Responsibility of firm’s top executives is to communicate with all employees about new data management philosophy in the company, what benefits it brings and to track the level usability of the ERP system by employees, removing internal cultural obstacles of working “as we used to”. ERP system brings tremendous operational improvements, if managers use the system in planning process, business processes’ remodeling, supply chain optimization etc.

ERP system links all areas of a company including order management, manufacturing, human resources, financial systems, distribution with external suppliers and customers. Successfully implemented, it represents tightly integrated system with shared data and visibility. If 15 years ago, this system was a privilege of large companies, now it’s an absolute “must” for all kind of businesses.

The matter is not only in potential real benefits of ERP implementation like declines in inventory, breakthrough reductions in working capital, ability to view and manage the extended enterprise of suppliers, alliances, and customers as an integrated whole. The stringent necessity of our data-driven time is to operate with exact, centralized and instantly accessible necessary data for effective decision-making. Real-time whole business picture allows analyzing much more effectively operational bottlenecks using integrated business intelligent tools (see Figure 1).

Figure 1. SAP Business One: Greater Insight Into Your Business

Creating competitive advantage starts from creating consistency and sustainability inside the company. A purpose-driven company must be managed by data-driven managers. The distance and angle towards operational and strategic business goals are measured by integrated management and accounting data. ERP system must serve a single resource of truth for all managers of any level. Nowadays, small company with 50-60 employees may have global business in many countries. ERP system gives exact instant information, what is happening in every corner of your company.

Using ERP system, company creates highly creative and genuine collaborative intelligence culture. Employees, departments, divisions are never conflicting about data source, calculations methods, priority allocations. There is no data discrepancy but there is data usage possibility. All these altogether contributes to authentic higher purpose – an aspirational mission of moral responsibility for company’s results and operational performance.

ERP data helps to build and run a purpose-driven organization. Data transparency and its consistency make difference in employee’s business involvement and mission-sharing innovations. Managers are more welcome proposing innovations for their core-processes of responsibilities based on purpose statement and full accessibility to centralized relevant data. Using data forecasts and analysis from ERP system, managers are eager to try new things, move in deep learning, and make surprising contributions.

ERP system empowers top-management to set clear goals and purposes and to communicate them to their people. Because of that it is extremely important that ERP implementation process to include professional training, how to use ERP system and to tune it to the needs of organization. This allows measuring every moment of time, what efforts may be put to be closer to the assigned goals and plans.

  Instilling a purpose is not easy. Many companies fail because they don’t successfully connect their purpose with employees’ day-to-day tasks and activities. People like to be part of something big and top-management is able to recognize daily/weekly/monthly employees’ hard work and efforts.

While ERP systems have the “magic touch” to dramatically enhance the performance of many companies’ business operations, they also have great potential to “refresh” and stimulate practical behavioral changes of employees based on sense of common responsibility for common results, possibility to track and analyze company’s successes and bottlenecks in real time, offering innovative solutions and cross cooperation of different teams.   

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