Is Your Business Ready for an ERP System? 5 Signs to Watch Out For

Imagine this, you're still stuck in the office late at night, trying to reconcile the day-to-day job procedures. 

You're having trouble keeping up with the order volume, and client satisfaction is on the decline. 

Your sales forecast was based on speculation rather than hard data, and it had been a long time since you knew the exact amount of stock in your warehouse.

Unfortunately, this situation might happen when a company expands and its previous models are unable to keep up.

Do you wish to improve the efficiency of your company? Of course, the answer is definitely yes.

It is critical for business owners to seek out the best tools for their market in order to stay on top of their business and stay ahead of their competition, and investing in an ERP system is no exception.

Why is ERP important? What are the signs when a business needs an ERP system? Check out the article below to get the answer!

Why is ERP Important?

Enterprise Resource Planning (ERP) software is used to manage a number of business functions.

Here are 4 important reasons an ERP system should be considered by any company:

1. Higher cost savings

First, ERP integrates several of your organization's systems that are currently scattered. Your employees will be able to access all of the resources they need for their jobs from one centralized system, from product development to accounts payable.

By integrating systems, you can assist your employees make better use of their time.

2. Improved Analytics

ERP is an excellent business intelligence tool since it records and maintains all of the data that users enter.

Without an ERP, reports that could take days to study and compile take only minutes.

When executives initially login into the system, most ERP solutions provide a personalized dashboard so they may see reports.

You and your team will be able to make the right decision faster if you have easy access to these reports.

3. Increased Productivity

ERP can help you automate your most time-consuming tasks.

The database in ERP software avoids time-consuming operations like data entering and allows the system to conduct complex computations in seconds.

This frees up time for your team members to execute more strategic work, enhancing your labor ROI. As a result, ERP improves your company's productivity, efficiency, and profitability.

4. More satisfied customers

Providing client-centered goods and services is the best strategy to boost customer satisfaction.

ERP can do this in a variety of ways.

For starters, most ERP systems come with or can simply be coupled with a customer relationship management (CRM) solution. Your CRM can access data from several business processes thanks to an ERP.

An integrated CRM can offer you things like order history and invoice information in addition to contact information. This allows your team to get a deeper knowledge of your clients' wants and needs by looking at them holistically. 

The expanded visibility of your customers helps in the formulation of your sales plan for improved lead creation.

If you find that your business is experiencing more than a few of these signs, it may be time to invest in an enterprise resource planning (ERP) system.

#1: You have a variety of software for various processes.

Consider how staff at your company record, track, and process data for a few minutes:

  • Do accounts payable and receivables are handled by one system, while customer orders are handled by another?
  • Is it a time-consuming manual process to take those orders, fulfill them, and enter them into accounting?
  • Do your warehouse employees use a different system to keep track of shipping and receiving?

When different front-end and back-end systems run in parallel, it can wreck chaos with the operations that are supposed to keep your business running smoothly.

ERP software integrates various systems, allowing all corporate functions to share a single database.

An ERP solution breaks up information bottlenecks by providing a single source of information that provides accurate, real-time data, allowing employees to make better decisions more quickly and freeing up their time to focus on higher-value tasks such as helping the firm develop even faster.

#2: Information about your company is slow to access.

How long would it take you to figure out your average sales margin if someone asked you?

What about other important performance indicators like orders per day or total sales?

It might be a long wait for organizations that rely on isolated systems and spreadsheets that must be manually updated and reconciled on a regular basis.

Because business moves at a faster pace than ever before, employees across your company require immediate access to critical data. 

Executives may receive a holistic perspective of business operations at any time with an ERP solution, while other employees can get the information they need to accomplish their tasks more efficiently.

#3: Accounting Is More Time Consuming and Difficult

Your accounting department is likely to be the first to notice that your company need ERP software.

If your staff still use paper invoices and sales orders and spend hours each week manually entering them into various accounting and sales systems, you should think about how much time is being lost on tasks that ERP software can perform in seconds.

Furthermore, if integrating or reconciling financial information across systems and through multiple spreadsheets takes a long time, an ERP solution can make a big difference. 

Accounting employees won't have to spend hours manually cross-posting information, rekeying figures, or reconciling data now that all financials are in one database.

#4: Customer Service and Sales are Suffering

Inventory management is typically one of the most challenging difficulties that businesses face as they grow. A critical aspect of business operations is ensuring that the proper amount of products are in the right place at the right time.

When sales, inventory, and customer data are kept separate, it can cause major issues for your business. If you run out of a popular item, you won't be able to sell it until the next supply arrives.

Meanwhile, if a customer calls to check about an order and your workers are unable to monitor it to see whether it has been shipped—or even if it is in stock—your company's reputation for reliability and service will suffer.

Staff in every department, on the other hand, will have access to the same, up-to-date information with an ERP system.

Clients should be able to access their accounts online and check their status. Meanwhile, the warehouse manager may notice that stock is running low and can place an order to replenish it.

#5: Your IT system is overly complicated and time-consuming.

One of the most significant disadvantages of having various systems across your company is that IT management can quickly become a nightmare. 

Customizing these systems, integrating them, and keeping them up to date with updates and upgrades can be time consuming and expensive.

System upgrades can be more trouble than they're worth if your patchwork of systems contains on-premise, older corporate applications. These updates are not only costly and time-consuming, but they may also remove adjustments made by IT employees. 

Given this, it's no surprise that two-thirds of mid-sized enterprises are still using outmoded business software.


Rather than adding more software—and complexity—to an unproductive system, ERP technology can help you respond quickly to changing business needs. 

That's why choosing a cloud-based ERP solution like SAP Business One is so important. System updates are no longer an issue with SAP B1, and adding new functionality as your organization develops and changes is simple.

Learn more about why a cloud-based ERP like SAP B1 is ideal for your business.

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