First of all, it is important for us to understand what ERP is and the purpose of it, therefore, I will go on to explain what an ERP software is and the function of it within a medium and large sized business, so we can reach a verdict whether it is in fact the most effective software solution or not.
ERP software, also known as Enterprise Resource Planning, is a software used for business management which can aid in allowing all areas of a business to have better communication with one another as well as making the process more effective. The way in which this is done is that ERP systems often incorporate all the facets of a business in one inclusive information system which therefore makes it easier and faster for employees to access all data and allow them to then make more efficient and informed business decisions. Examples of some functions which can be included in the software include finance, human resources, marketing and much more which can vary depending on the needs of the business and the core modules for ERP include Accounting and Finance, Human Resources and much more the type of ERP software system which a business will use will vary depending on the industry it is going to implemented within.
After researching different industries which have benefitted from ERP systems I have decided that the Nestle USA case is the most informative in providing not only advantages but also disadvantages of implementing ERP systems because Nestle USA faced a lot of failures throughout the process ,however, did in the long run achieve a successful result and I believe that by examining this case I can gain a fair view on the possible results and whether it is in fact the most effective software solution. Throughout my findings I will refer back to Nestle USA's case to further support the points I will go on to make.
Benefits of erp
An argument as to why ERP software systems are effective in a business is because when a business implements the software it allows for the business leaders, teams and staff to gain instant access to their global chains which can be accessed from almost anywhere, an example of how this had benefitted Nestle USA in gaining access to its global supply chains is that prior to ERP software being implemented in Nestle USA they found that their brand had been paying 29 different prices for vanilla from the exact same vendor however all under different names. [Worthen, Ben. Nestle's ERP Odyssey. CIO, May 2002 https://www.cio.com/article/2440821/enterprise-resource-planning/nestl--s-enterprise-resource-planning--erp--odyssey.html ]
This leads us onto another benefit of ERP systems which is that it allows for a business to identify challenges as well as to uncover opportunities and make faster decisions which can impact several areas of a business. Due to the Vanilla Case Nestle USA were able to identify this problem they had and not only negotiate a cheaper same price for all their brands but also eradicate the problem of having 29 different names for vanilla. This therefore allowed them to reduce manufacturing costs which allows for more profit to be made.
Another key benefit of having an ERP software system implemented in a business is that it makes the process of collaboration within a business and outside the business a lot easier and efficient. This is because all the key data is one place for all users to access and it allows for reporting to be more informative so that forecasting tools are more accurate in order for informed decisions to be made regarding the future of the business.
Costs of erp
Conclusion that related to medium and large size businesses
I will go on to look at how ERP systems have helped the large healthcare sector in accumulating all date in one place so that It can be accessed easily and quickly. Due to the healthcare sector having to not only keep patients' information confidential but also in a safe and secure place which is possible with ERP software. This is because the information stored on the system can only be accessed by ERP users and due to the fact that the information gets updated throughout the system in real time it means that doctors are aware of hospital reports and vice versa immediately therefore allowing for them to provide better patient care as well as reducing the time spent transferring data and money needed on this specific software which is in the long run reducing operational costs.
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