Why Enterprise Resource Planning?

Inan organisation, each department would have their own computer system,data and database. For instance, the accounting department might have acustomized computer system than the HR system in order to perform moreintensively on a specific task.

However, thesesystems would not be able to communicate with one another or need tostore or rewrite data to make it possible for cross computer systemcommunication. As a result, business value cannot be added efficientlythroughout the business process and organisation cannot be able tooptimize its productivity.

Enterprise Resource Planning

Enterpriseresource planning (ERP) is an enterprise-wide information systemdesigned to coordinate all the resources, information, and activitiesneeded to complete business processes. Therefore, implementing ERP forthe organisation can increase productivity as the business functionsare integrated and the data is in synchronized across the enterprise.It also simplified the computer infrastructure and reduced the numberof software specialties required.

Advantages of ERP

• Ensure quick processing of information and reduce the burden of paperwork.

• Identify hidden costs, bottlenecks, and inefficiencies

• Have a better control over suppliers and costs

• Access to integrated information for decision-making

• Have a user friendly database and do away with unwanted ambiguity.

• Close cycles for generating financial statements quickly.

• Serve the customers efficiently by way of prompt response and follow up.

• Disposingqueries immediately and facilitating the payments from customers withease and well ahead of the stipulated deadline.

• Say over your competitor by adapting to the whims and fancies of the market and business fluctuations.

• Protect against both outsider crime and insider crime.
  

When properly implemented, an ERP package can be the most cost effective project a company has ever seen.

Open source ERP

Infact, implementing an licensed ERP package for the organisation can bevery costly. A good news is that there are core ERP software availablewith no upfront license fees. And hardware costs such as servers can beup to 50% lower with open source software, because the open source codeis relatively less storage- and processing-intensive. In addiction,maintenance and customization cost are much lower because of the samereason. All these reduce the risks and challenges commonly associatedwith ERP implementations.

Here are some sources of savings by using open source ERP:

• Lower hardware acquisition costs

• Lower configuration costs

• Lower implementation costs

• Lower costs to change and adapt your automated processes

• Lower costs for every transaction

• Lower costs associated with upgrading
  

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