Enterprise resource planning (ERP) software is a class of computer programs that are responsible for documenting and managing various business processes, storing data about the various functions of the company, and keeping track of the commitments to clients and employees.
It’s an absolutely vital piece of technology for many industries and sectors, and if you have a business or are thinking about starting one, it is important to learn what makes ERP software good.
1. Industrial Standards
After the 2008 recession, governments in countries with the most advanced economies took it as a chance to pass sweeping regulations that have started stifling the private sector to a certain degree. That’s why, now more than ever in recent history, it is hard to enter markets and open new branches due to all the regulations and standards you have to follow.
That’s where good ERP software comes in – it can help you follow the regulations and standards at every step of the way. Not only through documentation talking about the rules, but also through good software design that ensures you have to follow the standards and gives you a prompt whenever there is an issue.
Although it is difficult to quantify exactly how helpful the ERP program suite is before directly using it in your business, you still should ensure the ERP suite is developed directly for your business sector and it’s implemented the industrial standards.
You should also keep in mind this is more important for some industries than others – ERP software for the construction industry that helps you follow standards will be immensely useful due to how notoriously over-regulated the real estate business is.
2. The Degree of the Increase in Efficiency
Ultimately, one of the main reasons businesses adopt ERP software is due to the increase in efficiency and streamlining of various business processes. Although you can’t directly compare the increase in efficiency you’ll gain from using various pieces of ERP software, you can get a good idea by looking at a few signs:
- How compatible the ERP software is with your particular business. It’s extremely more likely that a suite designed for businesses like yours and with your needs will take more measures to optimize the processes unique to your sector and industry. As such, those suites will increase your efficiency more. Plumbing software, for example, will be great if you’re running a plumbing service, but not if you’re a construction company.
- The ability to synchronize between different business processes and share data between them.
- Being able to collaborate with people within and outside the business easily and facilitate easy communication between different groups.
3. Data Processing Capabilities
Having a centralized suite that manages almost every aspect of the business would be almost pointless without strong data processing and data analysis capabilities. The power of having a lot of data from your clients, your employees, and your transactions give you a strong framework that you can use to gain amazing insight into all aspects of your business:
For example, normally, getting reliable data about your employees is extremely difficult – especially if their responsibilities are divided between multiple projects and tasks. That’s where ERP suites excel – having an all-encompassing platform that documents everything helps you get accurate data on your employees. This helps you learn all about your employees: who is working hard, who is slacking off, which tasks your employees are bad at, and which tasks kill the most time and need optimizing. You’ll be able to make your business much more efficient and cut down the costs. This isn’t only true about data about your employees, but all other parts of your business, too. That’s why you should pay special attention to the capabilities of the ERP software to correctly and efficiently process and analyze the data.
4. Security and Reliability
Having such a centralized system comes with many advantages, but there’s one glaring disadvantage you should be aware of. The increased reliance on the ERP suite will make you completely dependant on it, and if something goes wrong with it, your business will take a huge hit.
That’s why security and reliability are even more important than they normally are if you’re planning to use ERP programs.