The industrial sector has been undergoing various changes, and technological tools are keeping pace with this evolution. Today, it’s already impossible to separate management tools and ERPs from industrial companies, and entrepreneurs who haven’t yet made this investment might miss out on great opportunities. In this article, we explore some of the main advantages of an ERP for the industry and the key attributes that should be part of this solution.
Since the 1980s, the development trajectory of ERPs has been on an upward trend. Management software—which initially emerged to address the needs of the industry and manufacturing sector—has been developing over the past decades, encompassing new modules, features, and possibilities. Today, ERPs are increasingly essential for the smooth operation of companies, and as the Panorama Group notes, the sector that currently uses management tools the most globally is precisely the industry (33%).
Despite this strong connection to the sector, many industrial entrepreneurs are still unaware of the potential of ERPs and how this tool can even influence the longevity of their companies. Let’s start by understanding what an ERP is.
Definitions of ERP abound on the internet—in both quantity and diversity—but if we focus on the essentials, an ERP (short for Enterprise Resource Planning) is a management tool that connects and integrates all departments and areas of a company to optimize processes and share reliable and updated information among its users. It’s not, in most cases, a standard solution that fits all types of companies, but rather the result of a process of study, technological development, and implementation that should be tailored to each case.
Through an ERP, it’s possible to manage tasks ranging from supply chain control and production management (shop floor) to administrative services such as accounting, invoicing, and human resources management.
Essential Features for Industry ERPs
Let’s see, then, what the main characteristics that an ERP for the industry should have are:
Production Control
An ERP should allow for complete management of the shop floor, ensuring control and visualization of all production. This makes it possible to control delivery deadlines, assess yields and losses, team performance, and opportunities to optimize the process.
Flexibility
The needs of companies change frequently, and therefore, one of the mandatory characteristics for an industry-oriented ERP is flexibility. Whenever there is a strategic change, being able to adapt the ERP to define new performance indicators (KPIs) and metrics that provide managers with insights into the business and greater action power are great advantages of an ERP.
Customization and Scalability
It cannot be stressed enough that an ERP solution for the industry should be developed considering the specificities of the sector. There are no one-size-fits-all solutions, and even within the industry, each sector will have its particularities. Your ERP implementation partner should conduct an exhaustive survey of your needs to subsequently develop the most suitable solution possible. It’s also important that the solution is prepared to be scalable, meaning it can be modified.
Integration between Areas
Including all departments and integrating sectors into the ERP eliminates task repetition and automates manual processes. This avoids, for example, employees having to retrieve information from the system and re-enter it at a later stage. Thus, it’s essential to unify company management through centralized access to information.
When the ERP tool is configured with these assumptions in mind, it becomes much easier to benefit from its advantages, enhancing the company’s results.
Advantages of Using an ERP for the Industry
From saving time and money to increasing productivity and efficiency, companies that invest in implementing an ERP tool can no longer imagine themselves without it. Let’s see, then, the advantages of an ERP for the industry:
Increased Productivity
With an ERP, it becomes much simpler to manage daily deadlines systematically. Databases centralize information in one place, helping to optimize each resource. All of this makes it much easier to develop strategic planning and make quick decisions, thus generating significant productivity increases.
Saving Time and Money
A good ERP will help you save and, consequently, increase your company’s profits.
The processes of task automation and information centralization are restricted to a single platform, which eliminates the need for information review and the accumulation of paper documents. Management software helps reduce the margin of error, save time and money on alternative software solutions, and foster employee efficiency.
More Efficient Production of Reports and Forecasts
When there are no tools that allow for proper analysis and management of stocks and the supply chain, companies run the risk of accumulating unwanted stock or, conversely, experiencing shortages during a demand peak.
An ERP helps managers eliminate errors and optimize production and purchasing, sales, and inventory processes. It becomes simpler to make forecasts based on sales history, reducing the risk of accumulating or not having enough stock. This area is known as Business Intelligence (BI) and is one of the current major trends in the sphere of technology applied to business.
BI allows companies to respond to and analyze large volumes of data more quickly, enabling the production of reports intuitively by any employee and freeing the IT department for other tasks. All of this is done from intuitive and user-friendly dashboards, from which it’s possible to generate reports that are easier to interpret, thanks to appealing design and graphics, without a significant investment of time.
Higher Levels of Collaboration between Teams
Consolidating information on a single platform helps increase team efficiency and productivity, making collaboration between departments more organic and straightforward. On the other hand, an ERP helps eliminate redundancies and maintain consistency and accuracy of information within the organization.
More Secure Data
Data is one of the most valuable assets for today’s companies, and it’s increasingly essential to keep it secure. Additionally, managers can also customize access and restrictions to information. In the past, ERP technology was not as advanced in terms of data security, but nowadays, these tools even perform automatic updates, eliminating the risk of information theft.
Greater Mobility and Flexibility
ERPs can now also be accessed from smartphones, tablets, and PCs at any time and place, thanks to Cloud technology. This is especially advantageous for sales managers, who can easily access the tool during client visits, or for production managers on the shop floor, warehouses, and retailers, who can thus better manage information.
We hope this article helps clarify your doubts about why you should invest in an ERP solution for the industry. Soon, we will also make available the Complete Guide to ERP Implementation for the Industry, an e-book that will help you understand how to proceed, step by step, to successfully implement management software, among other aspects. And if you have any other questions, just contact us!
