Pros and Cons of ERP Implementation
While the corporate grows, it turns into more difficult to keep and manage the enterprise processes. ERP systems can help in this situation. ERP (Enterprise Resource Planning) system is a software, which permits storage and processing a lot of the firm’s important knowledge inside one database. Literally, this software program integrates all of the enterprise processes into one system, which streamlines and simplifies relations between completely different units (like manufacturing, accounting, HR and different units).
Advantages and Disadvantages of ERP System
In spite of the fact that ERP systems can simplify the management of internal enterprise processes, they are often complicated in everyday use or could be hardly integrated into the prevailing systems of a selected company. Let’s check out pros and cons of erp implementation.
Pros of ERP implementation
First, let’s see what revenue enterprise will get with ERP system implementation:
One Database
ERP system normally contains one database which unites all the data from totally different enterprise units. All the enterprise units have access to all data in real time which allows them to work faster and more effective. One single database also reduces the chance of the human factor, since there isn’t a need to re-enter the same information to several applications or to switch it utilizing paper documents, e-mail or flash drives.
Improved Security
There isn’t any need to store safe sensitive data in Excel tables, Google Docs or on paper. Security settings of an ERP system also enable to present or prohibit access for sure departments or workers, so everybody sees only the data they need for work and all the delicate data stays protected.
Scalability
Most ERP systems enable fast scalability in terms of new performance. You can simply add an already present module or combine a system supported by this ERP, so there isn’t a need to develop new performance, rebuild the system or rewrite present code.
Better Analytics and Planning
ERP system could be simply built-in with completely different analytical purposes which considerably simplifies analytics and improves forecasting and planning.
Challenges of ERP
ERP systems seem to be an efficient and even important tool for middle and large companies. However there are still some issues that needs to be taken into account.
High Costs
Integrating an ERP system is sort of expensive. In long term perspective ERP integration improves processes and saves money, but at the preliminary stage it calls for significant investment. The cost includes not only software but also analyzing and bettering present enterprise processes, payment for storage (servers or clouds), training your staff etc.
Codependency
The system ought to be rigorously integrated and monitored since if in the future it goes down, all of the working processes will stop. That is why it’s essential to set every thing up rigorously and to guarantee timely maintenance.
Risk of Failures
ERP implementation failure is a typical problem. The reasons may differ from company to company, but principally they’re the following:
- going far past the preliminary budget;
- selecting the incorrect ERP system;
- lack of ability of workers to stick to the new workflow.
These problems could be prevented by thorough planning and asking for vendor’s support.
Steps to ERP Implementation
ERP integration strategy demands lots of consideration and energy, however we all know how to make this task easier.
Here is an inventory of issues to embrace into your ERP implementation plan:
Plan the changes and ramp up a team
Choose an employee from every department to give you an in depth picture of the systems and processes within their unit. The job is to analyze the processes and find the methods to simplify them. Together with this staff create a plan of how these changes will happen.
Plan budget
The commonest cause of failing to integrate the ERP system is going out of budget. It occurs because not all of the possible expenses were taken into account on the strategy planning stage. Here is what to consider:
- upgrades of technical equipment;
- vendors’ fees (consultancy, training your workers, customization of ERP software);
- data backups and storage;
- overtime payments for your staff;
- loss of productiveness during on-boarding period.
Data migration
It is important to resolve which data to take and which data to leave. The factor to do here is distinguishing useful and up-to-date data from the old database, which you need to migrate.
The next step is to transfer it to the ERM system. It requires extreme accuracy, as all of the enterprise models now share the same database (and errors).
Training workers
ERP system won’t be helpful and may even do harm, if the employees doesn’t use it appropriately. So, don’t hurry to go alive and ensure everybody understands how to work within the new system.
Asking your vendor or skilled software company for training workers may appear pointless extra expenses, but truly that can speed up the training process and minimize possible mistakes in future.
Testing
Before running an ERP system, we strongly recommend to test it, mirroring on a regular basis working scenarios. It is better to test the system even twice or more to discover and get rid of all the problems which may arise.
After finishing all the preparations and going alive, don’t forget about constant evaluation to see progress and evaluate current efficiency with the initial plan. If additional difficulties emerge throughout work, analysis will even help to reveal them and to discover a solution real quick.
The Bottom Line
Although the implementation of Odoo ERP system in an organization could be challenging, it remains an excellent tool for medium and large companies, which helps to automotize processes and make them more effective.
A skilled Apagen’s team is ready to make it easier to with implementing Odoo ERP system: choosing the one which fits your requirements, integrating and maintaining it, and also training your employees. If you’ve questions, don’t hesitate to contact us!
