Long Business Systems, Inc. (LBSi) Explains Four Big Payoffs of an Integrated ERP System

You can gain these insights by gathering accurate data from all departments and managing it in a single database; doing so in conjunction with an integrated ERP system and integrated functions allows you to respond faster to market conditions in a more cost-efficient and streamlined manner, leading to a 10-60% increase in ROI.

This post highlights several areas where modernizing your ERP system will pay off.

Production Planning
An integrated ERP system presents unified data to production planners. Quick views and drill-down to detail in an easy-to-understand user interfaces give planners the insights they need to schedule and manage production runs based on key financial and operational data. Instead of planning production based solely on order size or perceived value, production planners can use better data – expected unit costs, potential supplier discounts, purchase lead times, current inventory levels, pricing, margin, etc. – to make better decisions. This information tells planners what they should prioritize and what they can move to the back burner.

Once production planners finalize plans, scheduling data is automatically incorporated into cross-functional workflows. For example, workflows to confirm inventory amounts lead to prompts for ordering additional parts and raw materials to satisfy prioritized production runs.

Purchasing & Supplier Collaboration
Integrated ERP systems like SAP Business One don’t just work within the confines of your business and its employees, either – you can grant role-based access to partners and suppliers who can offer valuable, ongoing input into your ERP data. You could, for example, perform scenario planning and then obtain supplier/partner feedback to determine the validity of your ideal scenarios (and what you’d need to change to make them doable). Planning and purchasing staff can create and run different scenarios in the system, which will respond with recommendations via ‘make’ or ‘buy’ reports. With the right information in hand, purchasing can then kick off workflows to complete all the activities required to buy and receive the supplies within the required timeframes.

Inventory Management
The inventory management capabilities you gain from a system like Business One make it easy for your purchasing and production planners to schedule their tasks. For example, integrating sales, production planning, and inventory ensures that you have the right stock on hand for normal operations and anticipated production runs. Moreover, the system ensures that you don’t carry too much stock and incur excessive carrying costs or carry too little stock and have backorders. The system can do this because of its single database – all warehouses share the same data, enabling you to gain cross-warehouse views of everything you currently have and everything you have being delivered, which can be broken down into item numbers, quantities, and due dates.

Opportunity Response Time
With all the relevant information available to sales and production planning, your organization can bid on opportunities faster. No longer will your people need to stress about the ability to fulfill and order, because the ERP system data will reveal what’s possible and incorporate workflows to make it happen (or to prevent deals that are impossible). Also, your salespeople can provide pricing that’s ideal for your organization regarding margin, as Business One tracks the margin based on various parameters for timing, volume discounting, supplier promotions, etc. With this method, sales can bid where it helps the organization, not the individual sales person.

Conclusion
Your goal is to grow your business profitably, and there’s no reason to spin more cycles and take bigger risks if the upside potential doesn’t similarly increase. Companies that seek to grow or increase profitability in today’s complex business environment are using software like SAP Business One to enable that growth – it’s the best way to provide the control you need to take on new business.

For more insights into the areas where Business One can improve your company, visit www.lbsi.com.

About Long Business Systems, Inc.

You want a partner that will help you apply technology to solve the challenges that today’s fast-paced global marketplace has created. We understand and have personal experience with the diverse demands that manufacturers, distributors and service organizations face.

Our clients keep pace with large global companies by applying affordable technology to streamline operations, act on timely information, and accelerate profitable growth. Let us help you intelligently apply technology to your business challenges.

LBSi has been helping clients with technology and business process improvement since 1989.