The ERP system enables the company to communicate with its customers, suppliers and business partners easily through the system. There is standardization of every procedure and employees throughout the organization can easily communicate with each other. Also, because of standardization the processes become simpler and easier to understand.
Every vendor had its own practice of implementing an ERP system. The software developers have introduced some practices, through their experience that are the best. These are then known as the best practices. These best practices maximize efficiency and help the ERP Company carry out a transaction in the best possible manner.
These best practices are mainly beneficial for the larger organizations or when the process is a commodity or also when there are compliance requirements. The best practice modification is one of the options that are given to the customer when he installs the system.
After the Enterprise Resource Planning system has been implemented, the organizations usually have four functional departments, mainly, advertising and sales, human resources, accounting and finance and supply chain management. These are the four basic functional areas of the ERP system. Within a company, the ERP system is mainly utilized by these four departments. These four departments are vertically and horizontally integrated because of the ERP system.
8. What is management's role regarding ERP systems
The management's role in the ERP system is to comply with the process and to be willing to share information. The management should not regard this as a threat. They should lead their employees to adopt the system as soon as possible and integrate it into their everyday use. As the ERP system is useful for the company and a move towards the future, the management in no way should hinder the process. The managers should take a horizontal view of the company this would help them be comfortable with the integration achieved from the system.
9. Why do some companies have more success with ERP than others
Some companies are more successful at implementing the system because they are motivated from the beginning. These companies want to improve efficiency and maintain a competitive advantage. The companies which fail in implementing the system do so because, the employees don't see the need for the new system and are comfortable with the system that is currently being used. Sometimes companies have very high expectations and when the ERP system does not fulfill these they are disappointed. Lack of training and knowledge hinders them to accept the system. There may also be technical difficulties and the basic data input into the system may be inaccurate.