Enterprise resource planning (ERP) is a category of business-management software - typically a suite of integrated applications - that an organization can use to collect, store, manage and interpret data from many business activities, including:
- Product planning, cost
- Manufacturing or service delivery
- Marketing & sales
- Inventory management
- Shipping & payment
ERP provides an integrated view of core business processes, often in real-time, using common databases maintained by a database management system. ERP systems track business resources - cash, raw materials, production capacity - and the status of business commitments: orders, purchase orders, and payroll. The applications that make up the system share data across various departments (manufacturing, purchasing, sales, accounting, etc.) that provide the data. ERP facilitates information flow between all business functions, and manages connections to outside stakeholders.
Functional areas of ERP
An ERP system covers the following common functional areas. In many ERP systems these are called and grouped together as ERP modules:
- Financial accounting: General ledger, fixed asset, payables including vouchering, matching and payment, receivables cash application and collections, cash management, financial consolidation.
- Management accounting: Budgeting, costing, cost management, activity based costing.
- Human resources: Recruiting, training, rostering, payroll, benefits, 401K, diversity management, retirement, separation.
- Manufacturing: Engineering, bill of materials, work orders, scheduling, capacity, workflow management, quality control, manufacturing process, manufacturing projects, manufacturing flow, product life cycle management.
- Order Processing: Order to cash, order entry, credit checking, pricing, available to promise, inventory, shipping, sales analysis and reporting, sales commissioning.
- Supply chain management: Supply chain planning, supplier scheduling, product configurator, order to cash, purchasing, inventory, claim processing, warehousing (receiving, putaway, picking and packing).
- Project management: Project planning, resource planning, project costing, work breakdown structure, billing, time and expense, performance units, activity management.
- Customer relationship management: Sales and marketing, commissions, service, customer contact, call center support - CRM systems are not always considered part of ERP systems but rather Business Support systems (BSS).
- Data services : Various "self–service" interfaces for customers, suppliers and/or employees.
The fundamental advantage of ERP is that integrated myriad business processes saves time and expense. Management can make decisions faster and with fewer errors. Data becomes visible across the organization. Tasks that benefit from this integration include:
- Sales forecasting, which allows inventory optimization.
- Chronological history of every transaction through relevant data compilation in every area of operation.
- Order tracking, from acceptance through fulfillment
- Revenue tracking, from invoice through cash receipt
- Matching purchase orders (what was ordered), inventory receipts (what arrived), and costing (what the vendor invoiced)
ERP systems centralize business data, which:
- Eliminates the need to synchronize changes between multiple systems—consolidation of finance, marketing, sales, human resource, and manufacturing applications.
- Brings legitimacy and transparency to each bit of statistical data
- Facilitates standard product naming/coding
- Provides a comprehensive enterprise view (no "islands of information"), making real–time information available to management anywhere, any time to make proper decisions.
- Protects sensitive data by consolidating multiple security systems into a single structure.
A good ERP system, properly implemented, can bring about massive improvements to operational efficiency, shine a bright light on hidden organizational costs and strengthen relationships with customers and suppliers. All of that translates into real growth - exponential growth - even in a challenging economic climate.
We at Infiniti Africa will go all the way with you, as your company makes the smart move, to ERP. From identifying the right ERP product that satisfies your business automation needs, to fully implementing the ERP system on your network. We have hands on experience with various ERP software and have been directly involved in rolling out the ERPs for companies spanning five different industries, all in East Africa. Furthermore, we have talented developers who will integrate ERP software and other specialized software that your company uses.
ERP Products we have worked with:
1. xTuple ERP
2. Sage Evolution
4. Microsoft Dynamics (AX, SL and NAV)