Big data has the ability to transform supply chain companies by providing insights and analytics that solve real business problems. One main pain point for supply chain systems is the focus on what has happened instead of what will happen. This is where an enterprise resource management (ERP) system can make a difference.
Studies show that two out of three supply chain leaders are implementing ERP systems already, but how can the data mined from these systems help shape company decisions?
What Is an ERP System?
ERP is a software solution that brings together all of the processes at a business and delivers detailed data and reports.
From processing orders to keeping inventory records, these systems can be customized to deliver the reports that matter to businesses in a variety of industries. By connecting the different areas of your supply chain business, you can get a look at where things are failing and strategize a plan to improve.
Streamline Loss Prevention
Advancements in technology have allowed supply chain managers more information than ever to control loss prevention. In a 2015 study, inventory loss was shown to have cost retailers and companies around $44 billion. For many smaller companies, this level of loss is not sustainable.
For supply chain managers, implementing an ERP system will allow you to track both inventory and overhead. Your system can also be set up to track shrinkage, and all of your employee’s actions within the system will be tracked. This allows you to better track lost inventory and keep an eye on who handled the piece last.
Improve Employee Relations with Data
Supply chain owners and managers know the power of their employees and the benefits they bring to any business. If your company doesn’t already have a comprehensive HR department, ERP can be a great way to manage your employees and address their problems or concerns and get valuable feedback from your team.
For example, many ERP systems have the ability to:
• Connect with your payroll process, meaning your employees will be paid on time, every time.
• Manage tax and insurance information for all employees.
• Conduct negotiations and ongoing training for your staff.
While these processes can improve the happiness of your employees, additional employee relation tools allow you to analyze performance and identify the employees who are making a difference at your business.
Reduce Overhead Costs
One of the things supply chain managers love most about ERP software is the ease of automation. In such a fast-paced business environment, automation can mean the different between success and failure for many businesses.
Setting up automated processes allows data to be collected at every step of the sale so you can reduce overhead costs significantly. Many ERP systems allow managers to set up additional workflows, such as:
• Automated purchase orders
• Buyer reminders
• Production scheduling
• Automated accounting
While it’s important not to rely too much on automated processes in any industry, managing ERP workflows carefully can free up time, costs and efficiency rates at your business.
The Bottom Line
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