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25Apr

Different Types of ERP Systems: What’s the Best Suitable for Manufacturing?

For every business owner, selecting ERP solution is quite an expensive and labor-intensive affair. Basically, ERP is an internationally-acclaimed software that seamlessly integrates the organizational data and brings all the operations into a single system. From inventory management to human resources, quality control to production and supply chain, it addresses to a variety of aspects regarding business.

When we talk about different categories or types of Enterprise Resource Planning software, it differs as per the unique business requirements. Some organizations prefer to access this software remotely from handheld devices – here, cloud ERP is preferable. A few of you may prefer to implement it on the local devices – in this case, on-premise ERP is the suitable one. A large-scale company or say MNC may require a different set of tools to address their day to day operation. On the other hand, the small-scale industry may not find it appropriate for their processes.

ERP for Small-scale Businesses

ERP is gaining momentum these days. The set of features offered by an ERP solution is second to none. Whether you deal with production or wholesale and distribution of goods, ERP covers all the business aspects very well and ensures that operations are performed at the right time, in the right manner and by the right personnel. It lets you keep a track of all the activities, reports and resources.

ERP is a powerful and nimble solution that acts as a stairway to success. It is quite understood that the requirements of small-scale businesses are different and limited. Hence, it is better to assess the specific needs of your business and thereafter scrutinize and select the ERP that fits the business needs.

ERP for Large Organizations

Big organizations have to deal with a huge volume of data, multiple departments, a great many resources, a multitude of machines and much more. ERP is the lifeblood that keeps the operations alive and flourishing. With an ERP, you don’t need to manually enter the data, built-in firewalls and resources ensure the utmost data security, improves the reporting process, saves time and money while increasing the production levels.

Companies with millions and billions of turnover have to struggle big time in order to achieve the desired results. They manage plenty of things at the same time. ERP ensures that such organizations perform well in all the aspects. You’d be glad to know that 80% of Fortune 500 companies use one or the other SAP software to manage their critical business operations.

Benefits of Enterprise Resource Planning software remain the same, whether it is a large-scale industry or a startup. When implementing an ERP, you’ve two options – on-premise and cloud ERP. Well, considering, the evolving technology, industries nowadays prefer to invest in a cloud ERP software that lets you enjoy myriad of benefits – it ensures growth and development in the coming years.

Cloud ERP

Cloud ERP is an ideal fit for growing organizations that are seeking the flexibility, agility, and high bottom-lines. The reasons why businesses are moving to cloud ERP are multiple –

–    It saves time and money

–    Anytime, anywhere availability of data – good for employees working remotely

–    Secured – All your business data is secured in datacenters that are reliable

–    Scalable as per the growth of your company

On-premise ERP

On the contrary, on-premise ERP is hosted locally on your computer systems. On-premise implementation comes with its own set of pros and cons. It is said to be more customizable and economical. You have complete access to your data. Let’s put it concisely here –

–    Less dependency on the vendor

–    It is priced under one-time perpetual license fee based on the number of users

–    Limited on-going cost

–    Easy customization

Horizontal ERP

Mostly, ERP systems cover horizontal and vertical attributes of a business. To be precise, horizontal attributes of ERP solution cover the most basic operations of the business – finance, sales, marketing, supply chain, human resource, accounts and more. These are the fundamental operations of any business without which they cannot excel.

Industry Vertical ERP

On the other hand, industry vertical ERP ensures that the solution that you are purchasing goes well with the particular industry that you belong to. Industries are many – consumer industries, discrete industries, service industries, public services industries and so on. ERP vendors focus on these niche industries and customize their software as per their specific functionality.

Open source ERP

The source code of open source ERP is made publicly available – this eliminates the license and maintenance fees. Mostly larger companies use this sort of ERP software as it is cheaper and easy to upgrade.

Licensed ERP Solutions

Primarily, there are two types of licensing models in ERP – perpetual and subscription based. It depends on how you prefer to pay to the vendor – whether on a monthly basis or a one-time lump sum amount.   Licensed ERP is proprietary software given under a licensing agreement to the authorized users.  Here, the source code is not shared with the public and therefore, without taking the license no one can change or look into it.

Now, the question comes which one is the best suitable for manufacturing business? Well, the answer to this question differs from organization to organization. The requirement, business processes, and needs differ from one another. In addition to this, there are multiple deciding factors, namely – budget, number of users, planning and preparation, reviewing and analyzing and more which are responsible for choosing an ideal ERP software solution.

ERP selection is quite an intimidating and time-consuming process that should be done after analyzing an array of business aspects. If you have any further queries regarding the same, To know more, feel free to contact us.

Download eBook on selecting ERP Software for Manufacturing Industry if you wish to learn more about ERP solution and how it can help your manufacturing business with its functions