ERP Software: Types and Benefits
Curious about ERP software? Check out our latest post to learn about the different types available and the benefits they can bring to your business. From streamlining your operations to boosting your profits, we have got you covered. Keep reading to explore the world of ERP software!
Types of ERP Software
There are three types of ERP Software. These ERP software programs function with different deployment models. They are:
● On-premise ERP software
● Cloud-based ERP software
● Hybrid ERP software
1. On-Premise ERP software:
This refers to the ERP software programs implemented and maintained on-site on a physical office or site. They are hosted on the organization’s or computer’s servers and computers and have full ownership, control, and support of the software program. An employee is usually chosen to oversee the smooth running of the software.
2. Cloud-based ERP software
Cloud-based ERP software is a web-based software that works on the Software as a Service (SaaS) which allows a company or organization to access and store data on any device (gadgets such as mobile phones, tablets, and desktops) with a good internet connection. The software provider offers continual updates, support, training, and customization to allow the organization maximizes the software efficiently.
Cloud-based ERP systems are highly flexible and suitable for organizations that run a flexible design. Also, cloud-based ERP mostly runs on subscription.
3. Hybrid ERP software
Hybrid ERP software is a program that implements both on-premise and cloud-based solutions. It serves as an amalgam of the two above solutions. However, the combination and degree of hosting and deployment services differ by provider.
Hybrid ERP software allows users to flexibly migrate between models to suit a variety of situations and integrate workplace benefits.
Companies that run an on-site office and an online workspace can use this software.
So, the nature of the organization your run will determine your choice of ERP.
What Industries Can Benefit From ERP?
ERP software can be used in basically all spheres of industries. It offers industries, companies, and businesses an effective communication tool to manage information between departments, customers, and partners. Also, it helps daily activities that include managing projects, inventory management, accounting, scheduling and sales management, and tracking adherence to regulatory guidelines.
ERP’s functionality is divided into modules. These nodules deal with an aspect of the company or business. These modules include:
● Project Management
● Customer Relationship Management (CRM)
● Manufacturing
● Supply Chain Management
● Data Services
● Financial Accounting
● Management Accounting
● Human Resources
● Order Processing
ERPs are very diverse. However, some are more designed to suit an industry’s needs than others. The following industries can benefit from ERP, but it is not limited to them:
● Retail and Consumer Goods
● Construction
● Manufacturing
● Healthcare and Hospitality
● Industrial Machinery
● Technology
● Automotive
● Aerospace and Defense
● Healthcare and Pharmaceutical
What Are The Benefits Of ERP Software?
Regardless of the type of ERP software, you are going for. Below are the top benefits of ERP software to your organization or company.
1. Mitigate risk: With ERP software, you can automate core business operations, reports, and manual tasks. This helps to reduce occurrences of human errors that may cause loss. Also, this gives employees more time to focus on other aspects of the company.
2. Increased productivity and ROI efficiency. One of the significant benefits of ERP software is that it helps to improve productivity and efficiency from the automation and integration provided by ERP software.
3. Improve business insight: Another significant benefit of ERP software is the provision of single aggregated facts and real-time data to give the organization better business insights to make informed decisions to help the company achieve its goals.
4. Promote a reliable supply chain and distribution network: The demand-driven MRP feature of most ERP software helps you forecast supply and demand and prepare a better plan for creating a reliable supply chain and distribution network.
5. Ensures regulatory compliance: ERP software helps ensure your business control and operation mode comply with regulatory standards. You can set up alerts to notify you of non-compliance
6. Boost collaboration. ERP software offers features that aid efficient collaboration, communication, and coordination to enhance job efficiency. So, on-site workers can easily communicate and pass business information with workers online via ERP software.
7. Optimize and manage relationships: Another major benefit of ERP is that it helps optimize and manage relationships of customers, partners, and suppliers through seamless information sharing.
What ERP System Do Most Companies Use?
Most top companies use the three major ERP systems: SAP ERP, Oracle ERP, and Microsoft ERP. Also, they are the most prominent ERP solutions on the global market.
SAP ERP is the world’s most popular ERP solution, used by over 2 million consumers across 180 countries. It contains all the helpful features needed to run your company. It is available on the cloud, on-premises, and mobile platforms. Also, SAP ERP is suitable for industries across different sectors, including growing and multibillion-dollar enterprises.
The disadvantage is that it is costly and unsuitable for beginners due to its advanced features.
Amazon, the dominant e-commerce marketplace globally, uses SAP ERP software to automate customer experience, and order-fulfillment processes, identify logistical needs, manage procurement, and handle financial reports and accounts.
Oracle ERP is a modern cloud-based ERP suite that offers complete and advanced capacities, such as automating manual processes, automatic updates to give you current information, insights to gain a competitive advantage, and real-time market analytics.
Additionally, Oracle ERP manages project management, procurement, accounting, and financial management functions.
One of the major companies that use Oracle ERP is Starbucks. Starbucks uses Oracle ERP software to automate everyday business processes and administrative functions, including finance, procurement, supply chains, and project management. Also, it provides real-time information on stock management metrics, expense analysis, operational reports, and Sales and revenue data.
Microsoft ERP is a cloud-based enterprise management software that enhances business communication by using AI to automate daily business processes. Also, it manages resources by providing access to real-time data, including managing production planning, cost management, and project management. The Microsoft ERP system comes in different packages.
Walmart is one of the multi-million enterprises that use Microsoft ERP to manage resources and offer automated solutions to manage physical stores, discount outlets, small localized markets, e-commerce platforms, and numerous brands across the globe.
Additionally, it is used to monitor warehousing capacity and can be integrated with existing software tools to boost efficiency.
Your choice of ERP systems or software depends on the size and nature of your business, organizational needs, expertise, and budget. Check out our article on the best ERP systems for your business for more specific information on selecting the best model that aligns with your business requirements.