Enterprise Resource Planning or ERP software is used to integrate the core functions in an organization, such as purchasing, sales, customer services, and accounting. They help to improve the efficiency of the organization by automating repetitive tasks. However, the needs of each organization differ and it is important to have custom ERP solutions that are tailored to meet the requirement and complexity of the organization.
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Customized ERP Software
Building an organization-specific ERP solution is generally expensive and is only viable for large companies. For most of the organizations, it is better to get a modular ERP software and customize its features according to the organizational structure and demand. This is as effective as building an Erp solution from the ground up but at a fraction of the cost.
The main task of the ERP solution is to gather data from the various departments of the organization and present them in a rational way after analysis. It helps the management in making data-driven decisions by extracting, organizing, and interpreting bits and pieces of disjointed information from the different departments.
The interconnections between the departments and organizational structure affect the efficiency of the ERP solution. When the complexity in the organizational structure increases, the custom ERP solutions also need to be modified accordingly.
Benefits of a Customized ERP Solution
There are numerous benefits of having a customized ERP solution in an organization which includes:
- Tracking the Key Performance Indicators in real-time
- Integrating all the units and departments of the organization
- Monitoring the workflow
- Identifying redundancy in data and tasks
- Analyzing the integrity of the data
Important Features of an ERP Solution
There are some important features that you should look for while selecting custom ERP solutions for your organization. These features include:
- Even the basic ERP solutions have the feature of automating the repetitive and simple task in the workflow for the organization reducing the workload on the employees and freeing up personnel for activities that require more attention.
- There are several single-purpose software in every organization, like for creating invoices. These are simple software that can be troubleshot by the ERP solution in case of any crashes.
- The ERP resolution also collects data from the various departments and units of the organization and analyses them to detect the trends and vital information that help the management in making decisions. The data and the analysis is store securely by the ERP solution access to which is restricted to only those with authorization.
- They provide the results in a simplified report which can be easily understood by management as well as other stakeholders of the organization including the creditors, customers, employees. This helps in boosting the transparency in the workload throughout the organization by eliminating the jargon, helping the management take effective actions without heavily relying on the experts.
- The ERP solution tracks the workflow of the organization from the beginning to the end. This enables it to track the movement of raw materials and finished goods within the organization. It has real-time inventory records and purchase and sales reports. It also helps in determining the reorder levels and placing orders timely, sending requisition requests, invoices, reminding debtors of their dues, etc.
- Since the ERP software deals with all the units and departments of the organization it helps in improving the interconnection among them allowing for easy communication and transfer of data.
Top 5 Advantages of a Customized ERP Solution
Custom ERP solutions have added advantages over the ready-to-use solutions.
1. You Pay For What You Use
Off-the-shelf ERP products have a set of features that you have to pay for irrespective of whether or not you use it. Not only do you have to pay the full price of the product but you also have to pay for the features that are absent as add-ons. This adds up to a significant amount spent on the ERP solution.
Instead, you can choose a software developer or you can contact the vendor of the ERP solution to create a customized version for your organization in which you pay for only those features that are required. This adds functionality that is tailor-made for the needs of your organization and helps in getting the best ERO solution given the budget that you have.
The vendors can also help to better understand the needs of your organization and suggest the features that would be suitable. The customization is done by taking into account the nature of the business and industry, the number of departments, units, and employees, level of technology already used in the organization, and a number of other factors to improve the customized ERP solution.
2. Optimizes the Workflow Without Changing It
Every organization has its own method of working and off-the-shelf ERP software may not be compatible with the workflow. So you may have to change it depending on the pattern that the software has built into. This also means training employees anew.
This disruption in the workflow may result in significant losses in terms of productivity and efficiency that may not be limited to the short term.
A customized ERP solution, on the other hand, will be able to integrate into the workflow of your organization without any additional changes. The employees would have to be trained to use the ERP solution only to integrate it into their activities in order to minimize the repetitive and mundane tasks as well as for data input and getting the required data from the ERP solution. This would end up making the workflow more efficient without causing a disruption.
3. Improved Overall Performance
Because of the greater compatibility of the customized ERP solution over that of the off the shelf solutions, the overall performance of the software gets a boost. The software is specifically designed for the purpose of achieving higher performance rates and improved application availability than its ready-to-use counterparts.
Since the customized software is modular, it is easy to reconfigure them to adapt to the growth of the business, incorporation of new products, departments, and units. Even without increasing the workforce, the organization will be able to handle a large influx of business partners, customers, suppliers as well as optimizing itself based on the new regulations.
It allows users to extract relevant information from the large database. It focuses on reporting the data in a visual and numeric manner to enable fast decision making backed by accurate data.
Also, Read: Emerging ERP Software Trends in 2020
4. Better User Interface
The ERP solution primarily deals with data and its presentation. The users in the organization may vary from the employees, experts, management, and outsiders such as creditors and suppliers. A customized ERP solution will help you to customize the presentation of the data depending on the user.
A simple and efficient user interface makes it easier to navigate the software, access the correct data, understand the analysis correctly, and take the right decision at the right time.
5. Combined Report For All The Departments
As mentioned throughout this article, the ERP software interacts with various departments including:
- Customer relations
- Supply chain
- Human Resources
All the departments have their own set of data and analysis reports dealing with the aspects they are interested in. But for the proper management of the organization, it is required that all these reports are unified to ascertain the effect of each stimulus.
A customized ERP solution is able to present a unified report in addition to the separate departmental reports, highlighting the results from each department in a simplified manner which can be understood by all. The system of single reporting helps in simplifying the analysis of statistics within the organization.
Things to Remember While Choosing an ERP Solution
The most common errors that people make while choosing the ERP solution for their organization are:
- They do not analyze the requirements of their organization and the employees, thus lacking in a solid strategy.
- Preferring specific features to perform certain actions rather than features that enable the organization to have a competitive advantage.
- Make the selection based on the cost consideration while compromising on the quality of the software.
An ERP solution is an investment opportunity for the organizations more so for small and medium enterprises aimed at optimizing the workflow and boosting the growth. This makes it extremely important that the best ERP software is selected based on the needs of the organization.
In order to get optimized benefits from the software, while choosing the ERP solution you should take input from the employees about their needs and vendors about the feasibility of having certain features as well as about the features used by other organizations in your industry.