What are the advantages and disadvantages of ERP?

Enterprise Resource Planning or ERP, is an essential business management software that companies of all sizes use. It is a centralized, companywide system that include core business functions such as accounting and financials, customer relationship management, inventory, and more. As a single business solution, ERP provides many operational and strategic benefits, from improving overall business productivity to streamlining end-to-end operations to providing a granular view of what is happening in the company. In today’s digital economy, Manufacturing ERPs are now the backbone of a company’s digital transformation/digitization.

Here is the list of Benefits that ERP offers:

  • Connects companywide functions, departments, and processes
  • Promotes granular visibility across the organization
  • Provides timely access to reliable business information no matter where you are
  • Enables proper optimization of resources, whether machines, man or material
  • Reduces business costs and increases profit margins through efficiencies
  • Improves communication and collaboration across the organization

Disadvantages of ERP:

  • Employees are resistant to change
  • Installation of ERP is not a perfect science (can fall outside of expected budget and timeline)
  • The benefits of ERP can’t be seen instantly. It takes employee adoption to realize the benefits. The more employees adopt the system, typically the greater the benefits.
  • If not installed under expert’s guidance, it can be disruptive to the organization’s growth

So, before selecting an Cloud ERP software, it is necessary to evaluate multiple systems and vendors.

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