ERP Explained: The Basics

At Freeman Clarke, clients frequently ask for our help with their Enterprise Resource Planning (ERP) projects. We’re not surprised, because ERP projects can take mid-sized businesses to an entirely new level. But they’re also notoriously difficult. ERP projects can be ruinously expensive — it’s often said that 75% of them fail.

With this in mind, in the coming weeks we’ll be developing our ERP Knowledge Center. It will provide a comprehensive introduction to ERP systems, how best to implement an ERP project, and how to avoid the common mistakes that lead to expensive and frustrating ERP failures.

But let’s start with the essentials.

What is ERP?

Consider all the core processes you need to run your company: finance, HR, manufacturing, supply chain, services, procurement, and others. The most basic function of ERP is to integrate all these processes into a single system. The result is that all these separate parts of your business have access to the same information in real-time.

But new ERP systems are anything but basic. They use the latest technologies such as machine learning and AI to provide information, visibility, and efficiency across every aspect of a business. And the promised integration may not materialize if the system is not implemented correctly.

Initially these products were targeted at the manufacturing sector. But they have generalized their offers to cater to every kind of business in every sector.

What are the advantages?

 There are too many advantages of a well-executed ERP system to list in one blog post! But we can say that the advantages break down into four main categories:

  1. Reporting. In the past, to generate reports, many companies had to manually merge data from multiple systems. (Many companies still operate this way!) ERP automates reporting and provides updates in real-time.
  2. Risk Management and Compliance. Each sector has its own regulatory ERP systems can be adapted to the needs of any particular sector or business, providing automation and transparency.
  3. Automation of Business Process. ERP promises to streamline front-office and back-office processes.
  4. Customer Service. Slick, integrated processes make for a more reliable business with fewer errors, which means that your people can focus on customers. And ERP systems often include Customer Relationship Management (CRM) to track and retain customers.

What are the options?

The best-known products are from Oracle, including PeopleSoft, Netsuite and JD Edwards; SAP (the full product and it’s confusingly named versions); Sage; Microsoft Dynamics and Microsoft Dynamics NAV; IFS; Epicor; and Access.

But the list of options can seem endless, as specific sectors have their own ERPs — you’ll find products for the legal sector, logistics, manufacturing, professional services, and facilities management.

How do I start an ERP project?

An ERP project is a major undertaking for any organization. If you’re approaching this for the first time or your current ERP project is going south, call Freeman Clarke for a low-pressure, no strings-attached discussion. Our people are experts in all aspects of ERP projects, solutions and products.

We’re also completely unbiased — unusual for the IT world, we have no commercial connections with suppliers. We simply use our skills, knowledge and experience to serve the best interests of our clients.

And look out for content in our ERP Knowledge Center, where we’ll provide straightforward, useful content on crucial issues like how to start on ERP project, how to implement a successful ERP project, and using ERP to solve integration problems.

Freeman Clarke is the largest and most experienced team of part-time, or fractional, IT leaders. We work exclusively with organizations looking to use IT to grow their business. For an informal conversation, contact us and we’ll be in touch.