What are the Benefits of ERP in the Manufacturing Industry?

What Are the Benefits of ERP in the Manufacturing Industry

The manufacturing sector has gone through a massive overhaul. Sought-after manufacturing practices encourage information mobility, growth management, and enhanced productivity.

Fortunately, with best-of-breed software solutions, it has become possible for employees to work collaboratively, no matter where they are, and irrespective of the time.

Manufacturers are now investing in high-end devices and resources, which will focus on improving response time, streamlining business processes, and driving productivity while creating a collaborative workplace.

These devices can be integrated with a powerful ERP solution, which will allow businesses to have a 360-degree view of the entire organization. It enhances the quality of manufactured items and brings every department on the same page.

What is ERP and how does it lead to productivity?

ERP or Enterprise Resource Planning software is comprised of integrated business management tools and processes that are used to manage information within a company. It can also be connected with machines to have better insight into the performance of both the equipment and the employees.

According to Allied Market Research, global ERP software market is expected to rise to $41.69 billion by 2020, registering a CAGR of 7.2% during the 2014-2018 (forecast period).

benefits of ERP in manufacturing industry

Here is a look at some of the benefits of ERP for the manufacturing industry.

  1. Improved productivity

Productivity is never an accident. It is always the result of a commitment to excellence, intelligent planning, and focused effort.

– Paul J. Meyer

ERP lets you manage daily schedules in a timely and systematic manner. It promotes centralized database support and helps management optimize every resource. ERP fosters refined strategic planning, prompt and diligent decision-making, enhanced speed, better synchronization, and the management of huge chunks of data.

Below are some ways ERP improves business productivity.

  • It streamlines financial operations and manages the sales process and other departmental processes.
  • An Enterprise Resource Planning solution provides accurate, real-time information for better decision-making.
  • A modern ERP system ensures prompt communication between employees for better collaboration and greater productivity.
  • It integrates departmental data and makes it easily accessible to employees.
  1. Saves time and money

Reduced business costs help to improve profits and growth which is the goal of every business owner.

When tasks are automated and information is consolidated in a single platform, ERP eliminates the need for revising, searching for and storing paper documents. ERP reduces errors, saves time, and ensures no additional costs crop up.

With a powerful ERP solution you:

  • You don’t have to invest in multiple software programs
  • More work can be done in less time
  • Operational expenses are cut while improving employee efficiency
  • IT can focus more on the critical areas of business

ERP decreases costs and improves profitability in an organization. It encourages lean manufacturing, which helps to:

  • Lower financial expenditures
  • Reduce supply expenses
  • Modernize your marketing efforts
  • Boost efficient time strategies
  • Improve your employees’ skills
  • Retain your customers
  • Improves product quality
  1. Easy forecasting and reporting

Why forecast?

  • To understand the factors that are responsible for enhanced sales (eg. season, trends, etc.)
  • To determine optimal inventory levels
  • To boost sales and encourage better customer relationships
  • To ensure enough stock is on hand to meet customer demand

In manufacturing organizations, planners usually face a crisis-like situation when their company experiences an unexpected demand for a particular product. It is the same scenario when in a slack season, the warehouse overloads with unsold excess inventory.

Thus, to avoid such unfavorable situations, businesses prefer to use an enterprise resource planning software system, which does not disturb the logistics and the entire supply chain process.

ERP brings sanity to production, sales, procurement, and inventory plans. It helps you generate forecasts and sales reports based on historical transactions. This avoids problems by minimizing out-of-stock or excess inventory situations. Plus, its intelligent report capabilities ensure that the company responds easily to complex data. Users can also run their reports without relying on IT personnel.

User-friendly ERP modules make the life of planners easier and less tedious. With ERP there is no more manually fetching of data and spending hours to create reports. Users can predict future demand and design material requirement plans appropriately. Powerful business intelligence tools make reporting simpler so that management can get a view of the entire organization.

  1. Integrated information leads to collaboration

Is your data still divided into different databases and is difficult to access? ERP holds the key to integrate disparate organizational data and make it easily accessible for users.

  • With an ERP system, there isn’t the need to invest in multiple software such as CRM, HRM, MRP, and an accounting tool. You get all of this functionality in a single system with centralized data that is easily accessible.
  • ERP eliminates redundancy and helps you maintain the consistency, accuracy, and quality of the organizational data.
  • Consolidated data helps with employee efficiency and productivity.
  • It promotes inter-departmental collaborative efforts.
  1. Enhanced data security

Data helps with a company’s growth so it’s important to have a secure infrastructure. ERP systems have excellent data security. And, managers and supervisors can enhance data restrictions on their projects and requirement.

Whatever data you insert in the ERP system, is secured and coded. Older ERP systems were vulnerable to cyber thefts because they required applying manual updates to every single component in the software. With new technologies, the ERP provider releases auto-updates timely, eliminating the risk of data theft.

  1. Mobility and flexibility – increased employee efficiency

ERP users can access business data from their mobile phone, tablet, laptop, or computer anywhere and at any time.

Mobile-friendly ERP enables employees easy access to documents to edit and approve on the go. Mobile-friendly applications for the shop floor, warehouse management, etc. help floor managers leverage information.


Companies cannot run successfully for long without an Enterprise Resource Planning system. It unifies business data and makes it seamless for the employees to use. If you are interested in knowing more about how a manufacturing ERP can help your organization, please contact us.