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Role of ERP in Supply Chain Management

When you look at the end product, you may have no idea where it came from. But is it really that simple? Like the saying goes, nothing’s ever what it seems. When you talk about product manufacturing, there are a bunch of activities that go into it.

Now, the question is, how can we make the manufacturing process easier? The answer – having a solid supply chain management system. By this point, you might be wondering what a supply chain management system is, right? Well, we’ll break the suspense.

Supply chain management can be called the bridge between you and your vendor to supply resources for manufacturing. It helps you optimize your process and ensure you get the right items at the correct time, in the desired quantity. Sounds great, doesn’t it?

But there’s a catch. With the business world evolving, the supply chain management system alone is becoming a thing of the past. Oh, won’t it be good for businesses to have a centralized system that would cater to business needs? Turns out there is, and it’s called Enterprise Resource Planning (ERP).

We’ve already talked in length about what ERPs are and their benefits. If you have queries, check out our previous blogs. As far as this blog goes, we’ll surely talk about the relationship between an ERP and a supply chain management system.

Let’s begin.

Benefits of ERP in Supply Chain Management

As a business person, you’ll be chomping at the bits. In these moments where you’d love to automate your supply chain management process with ERPs, here’s a wider perspective. We’ll list down the benefits of ERP in Supply Chain Management, along with some of the drawbacks.

Advantages of ERP in Supply Chain Management

Efficient Documentation

Do you remember what you ate a week back for lunch? Most probably not. Now, imagine having a system that would give you the answer. Yes, we know that recalling what you had for last week’s lunch isn’t that important. But what about when it comes to your business progress?

That’s where an ERP can do wonders, as it stores the historical data of all supply chain processes. You can have invoices, import & export analysis, or any other document within no time.

Better Collaboration

You would’ve heard the phrase, “Teamwork makes dream work.”

For that, you need everyone to be on the same page and know what’s happening. Particularly in a supply chain process, where you have so many stakeholders. Solution – ERP system.

Why? Because it’s a centralized database that rapidly updates data. This significantly reduces the bottleneck issues and enhances efficiency when it comes to the supply chain process.

Increased Accuracy in Results

By now, you’d have understood that ERP processes data at a rapid pace. But what good is the data if it’s not accurate? Imagine a slight change in original figures during the supply chain process. That will greatly impact your decision-making, which won’t be feasible.

This is the perfect time to mention ERP and its accuracy. Not only do you get quickly processed data, but you get accurate data as well.

Disadvantages of ERP in Supply Chain Management

Greater Cost

It’s an open secret that ERP is unlike your ordinary management system. Keeping that in mind, it’s also understood that an ERP systems are not cheap. So, if you’re using it for your supply chain processes, you may face significant financial implications.

Specialized Training

If you’re seeking the positive impact of ERP in your supply chain management process, you first need an expert to train you. Once you have mastered the ERP system and how it can help you optimize your supply chain method, then can you do wonders with it.

Time Taking Process

Good things come to those who wait. Implementing an ERP is not an overnight process. If you want the best ERP for small businesses, the customization may take a while.

What’s Next For ERP and Supply Chain Management?

ERPs have opened a whole new world of possibilities in various industries. Among the many industries, supply chain professionals have found ERP very useful, and now you know why.

If you’re looking for such a solution, ERInsight is your answer. You can get the supply chain module, along with other different others as well. The best time to start is now, so what are you waiting for?