Modern ERP software reduces overall operating costs, boosts productivity, and includes standard features that automate business processes and save time.
Investing a large amount of money in ERP is not a huge challenge. It is necessary to justify the budget and large expenditures. The total cost of ownership (TCO) is the sum of the license, implementation, training, and maintenance costs (Total Cost of Ownership). TCO is calculated over a number of years to arrive at an estimate (sometimes 5 to 10). Quantifying the benefits of the newly implemented ERP system by estimating ROI of ERP implementation is another way to justify the Total Cost of Ownership for ERP implementation.
The ROI analysis compares the expected cost of ERP software to the expected benefits (direct and indirect savings) of implementing ERP over time.
ROI is calculated by adding the expected returns from the ERP and then dividing the resulting amount by the TCO of the ERP, resulting in the ERP ROI.
The larger the quotient, the better the business.
Here are the five trends in technology that have the potential to shape the future of ERPs if implemented efficiently:
IoT has the potential to improve data collection and accuracy, enhancing the ERP’s contribution in areas such as customer service, forecasting, inventory and asset management, and business intelligence. IoT-enabled devices can communicate directly with the ERP system, allowing for increased connectivity and data accessibility.
This not only allows companies to keep track of activities from anywhere in the world, but it also allows them to do real-time research and produce useful insights and recommendations.
2) AI/ Chatbots
Companies can achieve faster and deeper insights into operations, clients, and workflows with an AI-enabled ERP framework. Chatbots can be built to allow users to communicate with ERP systems using commands. Chatbots can be programmed to respond to commands and, thanks to their learning skills, can help you target particular areas and provide deeper insights. For example, the identification of purchase trends at particular places or the actual fault point in a process that breaks down.
3) Machine Learning
When the ERP is on the cloud, it combines with other real-time systems to deliver a continuous stream of data to machine learning algorithms. This allows the ERP to understand and adapt more effectively to market requirements. Using this, business decision-makers can easily view and interpret corporate data and take educated decisions.
There is a vital need for the collection of commodity data in the supply chain-based market. However, data collection is an incredibly time-consuming, costly and error-prone method. The approach to this would be the integration of RFID with the ERP system. Using an RFID-based ERP device, commodity data can be monitored across the life cycle of the supply chain. This gives absolute access to warehouse managers and reveals just how much inventory to order and when.
This decreases the volume of stock on hand and removes the need for hand-held scanning. This results in rapid and substantial changes in inventory control.
5) Social Integration
As the business landscape is gradually becoming global, with staff spread across the world, it is important to develop popular interactive forums for people to exchange ideas in a safe atmosphere. Companies are searching for collaborative ERP solutions to create virtual boardrooms for management meetings, research and rapid decision-making. Through this feature, knowledge can be shared between users, current applications and business divisions.
Through more secure links, businesses may obtain accurate and timely communications to enable effective collaboration and information exchange to fuel market growth.