How to keep ERP costs low

Enterprise resource planning software is the backbone of many companies, especially those in the manufacturing and warehousing fields. In fact, research from Aberdeen Group called it the "operational and transactional system of record" in its most recent study of ERP in the manufacturing industry. Aberdeen's look into the state of the industry found that more than 90 percent of manufacturers are using some form of this software to manage operations, although there are many different types that are currently on the market. Selecting the right ERP can lead to lower initial and continuing costs, as well as a quicker return on investment. Here are a few pieces of advice to keep ERP effectiveness high and costs low:

  • Choose an adaptable platform: The reign of all-in-one ERP as the go-to choice for a majority of businesses has come to an end. That's not to say this kind of software is entirely useless or without merit, but there plenty of more useful and adaptable options on the market, especially when it comes to the varied needs of manufacturers and warehousing companies. Using a modular system such as Microsoft Dynamics NAV allows businesses to build their ERP systems with the pieces they want, while avoiding the costs that come with an inflexible, all-in-one design.
  • Find the right vendor: Choosing the right provider can mean the difference between ERP success and failure. The best companies will provide not just initial consultation and support when selecting and modifying a system, but will also offer continuing technical support during and after the implementation phase. Strong vendors will also help in the updating and upgrading phases that will eventually pop up, no matter what system or type of ERP is selected.
  • Don't neglect training: ERP systems can fail to thrive – and lead to greater costs – when employees aren't fully educated and immersed in a system. Costs associated with retraining and handling incorrect operations can be high, dragging down the effectiveness of a new system and negatively impacting perception. Tech Republic pointed out that implementations often go wrong when businesses don't truly understand the scope of installing a new system or try to skimp on training and the budget for doing so.

Learn how to define your ERP strategy by downloading the white paper entitled "ERP in Manufacturing: Defining the ERP Strategy" from the DMS website today.