Enterprise Resource Planning (ERP)

ERP are those systems employed to manage business operations in an attempt to integrate their functional areas.

It is important, before taking a decision about implementing an ERP system, to known its characteristics and the advantages and disadvantages that its can be generated for the company with its implementation.

probably, the first factor we need to consider, could be the price, because normally it is really high and it means assuming a considerable investment along a period of time, however, it’s an error to consider that the only price of an ERP is the price of the system, because it usually represents about 30% of the total cost, the rest of the costs, its come from the hardware, other services, maintenance and updates.

The implementation of these systems isn’t instantaneous, it requires a long process in which the company and the employees must adapt to the use of these systems, and take the necessary training to take make the best use. That’s the reason why many companies decide to implant this systems by phases, because it’s easier for the company employees to familiarize themselves with it, it could also be a form of analysing the risks and resolve any problems earlier and with a lower cost.

Each ERP is different, some key factors for deciding the right ERP for an organization are to assess what are the needs of the organization, what processes can be improved and how the ERP is going to help to do it, at this point, the culture, the objectives and the “know how” of the company must be relevant and must be consistent with the ERP system choosen.

Some benefits of implanting an ERP are that it provides reliable informations, avoids duplication and reduces time and costs.

With all that said an ERP is not a suitable tool for any business, only large companies can afford its high cost, because its implementation, implies also a process of adaptation and training that should involve all the company staff and provide useful information for decision-making.

The ERP is not a tool that guarantees higher returns with only its implementation, but it is an effective way to manage, treat and distribute the information to offer a global view of the business, it can generate competitive advantages and synergies within the organization, if the needs of the company are properly evaluated and the system has been implemented with a good management, it can lead to improvements in the profitability of our business.

So, finally, in my opinion an ERP is a truly useful tool when you are able to develop all the implementation process, the formation of your personal  and alignment in line with your goals, nevertheless, it requires a large investment and a great commitment from entire organization, if we are unable to perform these actions or our company is not so large enough to assume its costs, an ERP can be a competitive disadvantage because the rigidities in our processes, the higher costs to the benefits obtained or the resistance from the staff of the organization.

Comentarios desactivados en Enterprise Resource Planning (ERP) / 06 Feb 2013 por Alejandro Cuevas Barral
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