ERP Advantages for Management Functions

ERP management systems provide a technology platform in which organizations can integrate and coordinate their main internal business processes. They use this to fight against the problem of the organizational inefficiency brought on by the use of different systems in every department to store information.

Generally, large organizations manage many software systems at the same time depending on the activity to be performed. Most of these systems have the objective of storing and providing information about several processes that do not communicate between each other. Managers could spend a lot of time collecting the information necessary to make decisions for this reason, because if the information is not integrated, they will have to check it department by department and system by system.

This fragmentation of data into several separated systems can have a negative impact on the organization’s efficiency level and in commercial performance. ERP is the best alternative for solving this problem because it gets to coordinate every important system of the enterprise into a single database. It designs and automates many business processes with the sole objective of integrating the information of the whole company, avoiding complex and expensive bonds between internal systems.

Before and After

Before ERP, the information that was distributed in different databases was allowed to flow constantly through the whole staff, and it was always available. Separate business units such as sales, production, finance and logistics could be integrated in common business processes, allowing access for all the employees in every organizational level unless otherwise stated.

Nowadays enterprises must consider the use of an ERP as an obligation instead of an option in order to be competitive. With old systems the information that came from daily activities was difficult to handle. ERP can bring data from one area to another without any extra effort, and with almost no chance of mistakes. In addition to this, the information becomes available in real time, that is to say that by the time an order is entered, it can be prepared and invoiced all at the same time.

Frequent Mistakes with Administration Software

It is essential to understand that every organization has different administrative needs, and that the ERP must fit them in order to be helpful. This is why the ERP that can solve one organization’s problems could be useless for other enterprises. A current problem in many non profit organizations is that the administration is not efficient. Even though they are not looking for economic benefits, an ERP can help them to reduce costs and work.

The most frequent mistake made in small organizations is that every department has its own needs, and they ask technical department to provide software capable of matching them. Sometimes this is provided from the outside through vendors, and it might not even exist. If it does not exist the organization will probably ask employees to create it. This is why it is very difficult to have fluent communication between the different systems inside an organization, even if it might seem very small.

Administrative Functions of ERP

This module includes several applications for administration, treasury and financial activities. These applications allow you to work with more than one enterprise if you need it for obtaining consolidated data for different levels. The data can be made for different currencies as well. You will be able to generate reports and export them to Excel, PDF or text documents. The general accounting data can be distributed through a flexible accounts plan, which makes reporting and preparing information easier.

This module also gives you the opportunity of designing different quotes and defining the organization’s assets. It contemplates different criteria for depreciation, and it records data regarding purchases, sales, etc. It also includes applications for collections, payments and taxes.

You can find several key processes in ERP. One of them is the fully integrated funds management and controlling that supports convenient administration functions, as well as integrated functions for planning, monitoring and controlling resources, costs and personnel. It has core application functions with access to a common database.

Another one is the high performance payroll accounting function that determines the wages, salaries and pensions of workers. This solution also covers payroll lists and supplementary benefits such as seniority, sick pay, maternity benefits, vacation allowances and bonuses. Planning and management of personnel budgets is also easier thanks to ERP by linking discrete processes, i.e. planning of personnel budgets, funds approval and management and continuous budget control into integrated process chains. It provides visibility for managers into allocate funds and expenditures, notifying them of the need to take action.

Integrated personnel and career and succession planing application optimizes personnel planning by integrating employee qualifications and job requirement profiles. The solution follows a candidate through the recruitment process from job advertisement, application tracking and hiring, to employee career planning, succession planning and training event management.

The organizational management function provides easy- to- use planning and administration functions to efficiently map organizational structures, assign and describe tasks, create distribution plans and set up and modify fields of activity and positions. Predefined workflow processes optimize the efficiency of these functions.