Home Blog What is Enterprise Resource Planning (ERP)?

What is Enterprise Resource Planning (ERP)?

When discussing their data management requirements, our customers often ask us “What is Enterprise Resource Planning?”

We have prepared this article to cover the ERP basics. Enterprise Resource Planning (ERP) is an automated software system or solution that manages multiple programs and consolidates information from various sources.

What are the benefits of ERP?

ERP provides many solutions for your business across multiple functions. ERPs improve communication between systems and people as well. When you install an ERP, data can flow more easily through any and all other systems. Benefits of ERPS include:

Improved accuracy
Better information exchange
Easier reporting
Enhanced productivity
Scalability
Enhanced communication and collaboration

What are the unique features of ERP?

ERP software simplifies the complex processes of the modern, dynamic organisation and manages service streams or business activities such as manufacturing, services, financial, supply chain, and other important processes of your business. A properly designed and installed ERP offers benefits for compliance, supply chain management, risk management, and customer management among others.

Who are ERPs for?

Accurate data collection and dissemination are crucial for any business, and implementing an ERP system can be highly beneficial. From tracking sales and inventory to managing finances, all businesses can take advantage of ERP systems. While it is particularly popular in manufacturing and production-based fields, it has also been adopted in a variety of other industries, including healthcare, e-commerce, and non-profit work.

How to deliver ERPs?

ERPs can be delivered both through cloud services and through on-premises services. Modern ERPs can even be provided with a hybrid approach using a mix of cloud and on-premises options.

ERP implementation refers to the process of integrating various business functions, including finance, operations, and human resources, into a single system through the installation and configuration the system within an organisation. ERP delivery activities include:

Data assessment

By assessing your current systems and pinpointing areas that need improvement, you can make well-informed decisions regarding the functionality and features crucial for your organisation. This will enable you to select an ERP solution that aligns with your business requirements.

Data modelling

Your ERP is all about rounding up, gathering and processing data from multiple systems to give you a synthesised view and a consistent and accurate data set across multiple indicators. An important step in ERP implementation is ensuring data from multiple systems can be brought together. This means understanding the formats in which systems are creating data. Then a tool or process for conducting clean ups, removing duplicate or inaccurate data must be delivered.

Establishing a common database

The next step is creating a common database to handle data rules and workflows across the different systems. Standard processes enable the creation of a common database. Consistencies in language, dates, times, prices, and other data sets allow the ERP to scan, assess, and compare data from multiple technological solutions.

Configuration and testing

Your chosen ERP needs to be configured to the specific requirements of your business. Cost centres, business units, and workflows, among others, will need to be established. ERP testing should include user acceptance, functionality audits, accessibility reviews, workflow tests and system security analysis.

Improving real-time operations

Once behind-the-scenes, improvements have been made and systems are effectively matched and standardised, it's time to let your ERP do its thing! The ERP provides integration and automation that improves performance. The established ERP gives you a holistic view of activity across any number of business functions.

Reporting and data analysis

If you know where your business stands, then you know why it is where it is. With ERP, you can have better insights into the status of your business. The final part of establishing your ERP is finding the benefit of improved business insight. With aggregated information from one single source, you can have real-time data and can make an informed decision. This reduces manual reporting and eliminates the need for human-based data interrogation through automatic reporting.

What are the differences between ERP and PIM?

ERPs are quite different from Product Information Management (PIM) systems, and the two tools serve different technological purposes. PIM systems are designed explicitly for managing product data and are not intended to replace ERP systems. While ERP systems can include product management capabilities, they are not specifically designed for managing product data.

ERP focuses on managing and integrating various business processes, including finance, stock handling, supply chain management, human resources and other records. The ERP system helps you to manage resources more efficiently and make better-informed decisions by providing real-time data and analytics.

Meanwhile, PIM focuses on managing product-related information, such as product descriptions, pricing, and specifications. PIM systems enable businesses to manage their product data more efficiently and accurately, ensuring that product information is consistent across all channels. PIMs are especially beneficial for enterprise and e-commerce businesses.

ERP systems are more comprehensive and focus on managing various business processes, while PIM systems are designed to manage product-related information more efficiently and accurately. Both systems play an essential role in managing a business, but they serve different purposes and can be used in tandem for optimal results.

How can an integration of ERP and PIM be beneficial for businesses?

With their unique capabilities, it makes good sense to consider combining ERP and PIM. These two systems can work together to ensure that there is consistency and transparency maintained across very complex data sets. Furthermore, while an ERP might improve functionality internally, PIM systems enhance access to information for the customer. Your internal information processes can be supported through quality and highly detailed information delivered straight to the customer.

Next, we outline the top benefits of combining ERP and PIM.

Benefit of combining ERP and PIM – enhanced product catalogues

The first benefit of combining ERP and PIM relates to your product catalogues. Your product catalogue is your primary tool to engage with your customer and nab regular and high-volume sales. If your enterprise business has a high number of products available, or, has a smaller number of highly customisable products available, you will want to create an inviting sales experience for customers, online and through printed catalogues.

ERP systems can combine stock control, warehousing and supply data with product listings in the PIM environment. PIM tools can create accurate and detailed product descriptions based on information drawn from the ERP.

Benefit of combining ERP and PIM- streamlined processes

The next benefit of combining your ERP and PIM system relates to streamlined processes around the business. A cohesive ERP dashboard will provide access to PIM data, connecting records from all around your organisation. Data is no longer siloed; instead, it can be accessed wherever it is needed. Data is accessible internally for staff, but also more readily available to customers and vendors.

Benefit of combining ERP and PIM – improved performance
The next benefit concerns operational efficiency, improved processes, and better business capability. The PIM-ERP combo means less human effort enhanced by more improvements to product handling and display. These two tools working together will enable you to accomplish more through automation and enhance productivity. Employees will get more done with fewer resources.

Do businesses with ERP need PIM?

PIM systems are designed to centralise and manage product data. ERP systems provide a comprehensive solution for managing a wide range of business processes. Simply put, PIM focuses solely on product and product data, while ERP concentrates on managing higher-level business processes with products. Adding a PIM tool to your ERP can elevate your presence and repution.

How can PIM help businesses with ERP?

Here, we cover the top four ways we believe that a PIM can help improve and enhance your ERP.

1. Faster Data Onboarding

Using an ERP system as a single system can have some limitations. Unwanted data may accumulate and take up space that could have been used for relevant data. Additionally, it can be challenging to keep track of inactive products with just an ERP system. This is where PIM comes in handy, as it allows you to quickly add or remove specific product information, enabling you to work more efficiently.

Moreover, PIM for ERP allows you to standardise data received from multiple suppliers and interpret product attributes more easily. With PIM-ERP, you can ensure that products reach the market with real-time and relevant product information stored in a single place, making your tasks much easier.

2. Data Integration

PIM has the ability to incorporate data from ERP, as well as other systems, databases, spreadsheets, and programs. In the world of e-commerce, the visual representation of a product is crucial, and PIM recognises this by making products visually accessible after collecting data from the ERP system.

By implementing PIM, you can work smoothly with an automated and dependable system, without the burden of juggling tasks. Sharing information, generating reports, and analysing products is made easy. Bid farewell to the tedious manual task of data entry once PIM for ERP is in place.

3. Data Optimisation

Having accurate and trustworthy data is crucial for any e-commerce enterprise to succeed. It's imperative to have optimal data available at every stage of the business. PIM and ERP are the perfect combination to ensure that you have top-notch data throughout the entire product life cycle, impressing your customers at every step.

By utilising these two systems, you can easily identify unstructured and missing data, as well as eliminate any irrelevant data. With the help of ERP-PIM, you can fill in any data gaps and correct any errors, resulting in a seamless and efficient data sets.

4. Rich-product Experience

The combination of PIM and ERP systems is essential for any successful e-commerce venture as it provides a rich product experience for customers. PIM is responsible for providing comprehensive product information, ensuring that customers have access to all the necessary information regarding product benefits and features.

PIM performs data analytics to identify external market trends, allowing businesses to stay ahead of their competition. Without PIM, the forward facing components of the ERP system would be incomplete. PIM systems also feature self-service portals where suppliers can input their product data directly into the system, improving the entire process.

Data improvements in ERP and PIM

PIM systems can also support various file formats, including Excel, CSV, and XML, and data can be loaded manually or through automation. On the other hand, an ERP system is designed to automate repetitive business activities such as payroll, order processing, invoicing, reporting, and more. This automation speeds up data entry while lowering the risk of errors.

Furthermore, the ERP system's features enable businesses to transform data into valuable insights and reports, which can be used to reallocate resources or identify new market opportunities. PIMs with integrated DAM features may centrally manage and store digital materials like pictures, videos, and audio which are uploaded by both corporate personnel and outside parties.

The ability to sell, upsell, create bids and buyer orders, predict sales, manage rewards, and keep track of crucial information like profit margins and ratios is another feature that ERP systems can access when combined with PIM.

The capacity of a PIM system to interact with both internal systems and customer-facing platforms, such as shopping cart websites and e-retailer sites, is its most important feature. PIM handles the integration of many systems. It integrates with other crucial operational systems like CRM and ERP, which are the most essential tools for every firm.