Deciding whether your organization is a good candidate for an ERP system is undoubtedly a complex question. You may have heard many things about ERP systems, some of which should cause you concern, if not hesitance, before jumping into this kind of commitment. When it comes to evaluating who are the primary users of ERP systems, there are large, simple companies that don’t need ERP systems, and there are small complex firms that need to take full advantage. Understanding your needs, and what options there are, is critical to your evaluation.
Primary Business Users of the ERP System
ERP systems are, first of all, ‘integrated.’ This means that all of the modules ‘talk’ to each other and information flows from one area into another automatically. It is unnecessary to re-enter data from sales orders, such as the billing system for sending out invoices. This not only saves the time of rekeying details, but the integration means that you can be sure that all sales orders are invoiced, for instance. Your business system is ‘tighter’ because it has ‘checks and balances’ built-in and you can eliminate errors, like forgetting to invoice.
Primary business users of ERP systems typically have large volumes of transactions (so efficiency is critical) and/or complex transactions so accuracy and tracking of information is critical. Certain industries require traceability of materials, lot tracking, and serialization etc., which are all excellently tracked in an integrated ERP system.
There are many ‘off the shelf’ programs that do an excellent job in their areas (Quickbooks for example) and companies can utilize spreadsheets that are linked or shared, so multiple people can access an update information. However, there are no ‘checks and balances’ by using these various solutions, and mistakes can happen – likely faster than any other way.
Primary Industry Users of the ERP System
We at EpiCenter work in manufacturing, which is the largest industry that uses ERP. Typically the more complex the business, the more need there is for ERP. Capital equipment manufacturers can have hundreds of levels of bills of materials, subassemblies, and myriads of purchased materials and other items that all need to be planned, scheduled, and traced. It would be very hard to do this without a robust system. Similarly, contract manufacturers take on any number of varied requirements that need to be tracked, and tend to have many ‘small’ transactions. It takes the same amount of time to track a large one as a small one, so the more efficiently you can do it, the better.
Some companies are ‘engineer to order,’ meaning they have some standard ‘core’ products and many ‘one off’ products. ERP systems are especially good here because entire methods of manufacturing can be copied and altered for these requirements. Systems like Epicor, which we represent, can have robust ‘configurators’ that allow users to enter data and parameters and make rules-based choices to narrow the items necessary to specify their desired product. The result is tremendous savings of engineering time – let the engineers design the configurator and the rules that follow, and you’ll have a very reliable and repeatable process.
One category that we get asked about often is startup companies, especially those in the medical device industry. How early in their growth should they procure an ERP system? In the case of Epicor, systems can be purchased for 2+ users, and we find then that a company that grows up with their ERP is better run, scalable, and minimizes administrative cost right from the beginning. If they wait until they hit a threshold ($5 million in sales or 50 staff) they are already pretty good sized companies, and the effort to implement is that much more complex. Why not do it ‘right’ the first time?
Lastly, more complex manufacturers and those who have governmental or investor oversight are those that benefit the most. When information only needs to be entered once,
Contact EpiCenter Today About Your ERP System Needs
Now that you understand who are the primary users of ERP systems, as your organization is potentially moving toward an ERP system, we encourage you to reach out to us at EpiCenter early in the process. We may have existing customers in very similar industries who are willing to share their experiences. Our motto is ‘every customer is a reference’, and we have hundreds of them. Contact us today to find out the details of whether an ERP system is a fit for you and whether that system is Epicor Kinetic.
written by Jeffrey W. Glaze, President