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The Benefits of an ERP System in Supply Chain Management

ERP refers to Enterprise Resource Planning. The system aids manufacturers to effectively and efficiently use assets and provide customers with the visibility they require. ERP enables manufacturers to offer a platform that allows an effective response to the changing supply chain. Relating the two, Supply chain management deals with the direction of the movement of resources and ERP aids in enhancing the performance of the plan of action.

Implementation of the Enterprise Resource Planning system brings about a number of changes in the organization's structure. These changes have to be managed in the proper manner by the management. To be a successful supply chain link for your customers, regular information visibility is demanded. Information regarding the production planning, scheduling, supply chain inventories, etc. have to be collected, analyzed and shared.

ImplementationThe benefits that an ERP system offers to supply chain management in the bid to improve the performance are further outlined below.

Global visibility

An enterprise resource planning system enables the manufacturers to know the location of the inventory throughout the supply chain. This allows the manufacturer to develop the best plan for production. The inventory can be re-supplied and shipped as per the need of customers. This helps the manufacturer to use the inventory in an optimum manner and still provide excellent service to the customers. Having real-time information helps to take the right and timely decisions. With effective implementation of the ERP system, you will be able to provide your customers information on the visibility and availability of the inventory.

Improved performance

The ERP system helps in the analysis of the business to allow the measurement of performance. This will serve as a guide on which the business operation is based, and also an indicator of possible problems in operation.

Create Improved Customer Satisfaction

ERP offers a better understanding of the customer needs as regards to products and services. This integrated view enables the company to increase its profits and build long-term relationships with customers.

Low Production Cost

Keeping the cost of production low is essential for the success of any business. Sourcing for materials from the best suppliers will help in achieving this. Doing this requires the appropriate exposure to the comprehensive database via which a comparing of the cost of manufacture can be made. ERP helps to ensure lean operation and provides real-time data.

By having visibility, standardizing the process and integrating the data, an Enterprise Resource Planning system provides the manufacturer with improved customer satisfaction, increase in profits, reduced costs and transparency. ERP offers a platform for scaling with the competition on an international level and thus benefits the manufacturer. ERP and supply chain management extends to include the suppliers and customers. It is a formal way to plan the resources of the business enterprise. With ERP, you can establish operating performance measurements to manage the business operations and meet your goals.

Inefficient management or obsolete supply chain is bad for all businesses. Integrating an ERP system in your supply chain management will ensure that you are able to deliver your goods and services to consumers with high efficiency, quality and importantly, a great speed.