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By: Peter Poletti

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ERP Software Functions & Features

Enterprise Resource Planning (ERP) software helps a company increase its bottom line by more efficiently managing information all over its business processes and site infrastructures. ERP systems may thus easily offer 5,000+ features and functions to help the company:

  • capture and predict demand for products
  • coordinate supply chain activities
  • manage production and capacity
  • optimize sales and operations planning
  • deliver timely products to customers
  • offer reliable field service
  • ensure accurate accounting of all activities
  • provide management with reporting and predictive analytics

Can you imagine how many man hours would be needed to list and document all of these ERP functions and features? Actually more than 3 months for an expert in the field. Because ERP software are alike to a great extent, don't you think we could find some sort of ERP software requirements template to use instead of developing the list of software evaluation criteria yourself from scratch or even paying someone big bucks to do it? Want to select the right ERP software solution while fastening the requirements gathering process? So do it right by downloading the ERP functions and features below.

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WHAT IS ERP SOFTWARE?


The research firm Gartner defines an ERP system as the set of "applications that automate and support a range of administrative and operational business processes across multiple industries, including line of business, customer-facing, administrative and the asset management aspects of an enterprise." ERP software covers broad and deep operational end-to-end processes, such as those found in finance, human resources (HR), distribution, manufacturing, service and the supply chain.

The ERP software comparison report can save you up to 90% of the time you would have otherwise spent comparing all the ERP solutions from scratch.

The ERP Functions & Features comprise the following elements:

  • Financial 9 function and features

    The Financials module provides features and functions that allow accountants and financial managers to ensure financial transactions are tracked and properly recorded, and that this information is available via reports and other data retrieval tools. Traditionally, this module includes the general ledger, accounts payable, fixed assets, cost accounting, cash management, accounts receivable, and financial reporting submodules Financial, ERP Functions & Features
  • Human Resources 8 function and features

    Human Resources encompasses all the applications necessary for handling personnel-related tasks for corporate managers and individual employees. Modules will include Personnel Management, Benefit Management, Payroll Management, Employee Self Service, Data Warehousing, Health and Safety, Workforce Management, Training, and Product Technology Human Resources, ERP Functions & Features
  • Product Technology 5 function and features

    This group of criteria defines the technical architecture of the product as well as the technological environment in which the product can run successfully. Criteria include product and application architecture, software usability and administration, platform and database support, application standards support, communications and protocol support and integration capabilities. Relative to the other evaluation criteria, best practice selections place a lower relative importance on the product technology criterion. This apparently lower importance is deceptive because the product technology usually houses the majority of the selecting organization's mandatory criteria, which generally include server, client, protocol and database support, application scalability, and other architectural capabilities. The definition of mandatory criteria within this set often allows the client to quickly narrow the long list of potential vendors to a short list of applicable solutions that pass muster relative to the most basic mandatory selection criteria. Product Technology, ERP Functions & Features
  • Manufacturing Management 7 function and features

    Manufacturing Management covers discrete manufacturing and provides the ability to plan production at various scales, rolling high-level plans down into daily schedules of individual machines and workers, and tracing real-time situations on the production shop floor and in planning to control manufacturing, and thus ensuring manufacturing facilities follow production plans in an accurate and timely manner, as well as providing the ability to alter manufacturing schedules and current operations as required. It involves product configuring, work centers and machines dispatching, all aspects of work-in-progress management, and comprehensive product costing functionality. It also provides a consolidated view of the production situation using extensive multi-level reporting capabilities. Manufacturing Management, ERP Functions & Features
  • Quality Management 3 function and features

    Quality management refers to the set of actions taken by an organization to ensure that it creates and delivers high-quality products. In order to do so, organizations must comply to national and international rules and regulations related to product quality, but they often also create and use internal requirements for quality control. Specific procedures need to be set up in order to ensure that the end products comply to internal or external quality standards. All these activities need to be well documented in order to provide the information needed when customers are not satisfied with the quality of the products received. Government agencies may also require this information for control and verification. Quality Management, ERP Functions & Features
  • Sales Management 6 function and features

    Sales Management encompasses a group of applications that automates the data entry process of customer orders and keeps track of the status of orders. It involves order entry, order tracing and status reporting, pricing, invoicing, etc. It also provides a basic functionality for lead tracking, customer information, quote processing, pricing & rebates, etc. Sales Management, ERP Functions & Features
  • Inventory Management 8 function and features

    Solutions for inventory management are used for the record-keeping of goods that are warehoused, and managing the movement of these goods to, from, and through warehouses. Inventory Management, ERP Functions & Features
  • Purchasing Management 12 function and features

    Purchasing management encompasses a group of applications that controls purchasing of raw materials needed to build products and that manages inventory stocks. It also involves creating purchase orders/contracts, supplier tracking, goods receipt and payment, and regulatory compliance analysis and reporting. Purchasing Management, ERP Functions & Features

BENEFITS OF ERP FUNCTIONS AND FEATURES

 

ERP software functions and features allow you to establish and maintain the ERP requirements and proposal evaluation criteria set forth in the solicitation package sent as a Request for Proposal (RFP) to ERP software vendors. Those requirements constitute the Work Breakdown Structure (WBS) included in the Statement of Work (SOW) of the RFP. ERP software functions and features are used in the WBS to

  • define the scope of work in terms of deliverables required by the software buyer (supply, inventory, production, sales, delivery, support, accounting, human resources)
  • ensure common communication grounds between both the software buyer and the software supplier
  • provide management with a base to report on the progress of the implementation phase of the acquisition project
  • serve as an input to other project management steps of the acquisition process

BENEFITS OF ERP SYSTEMS

 

An expected return on investment (ROI) is always the motivation and justification for investing in an ERP system, whether the organization is doing good or bad. ERP system implementations have quantifiable benefits on the company's bottom-line, its profitability, even in the price of its stock. Typical benefits of ERP systems are lower inventory and costs of production materials; reduction of labor and overhead costs; more efficient sales process; improved customer satisfaction thanks to a faster and better service, delivery, and support; and improved accounting procedures. All of which affect positively the company's balance sheet, income statement, key financial ratios, and stock price. The implementation of an ERP system provides also intangible effects, hence difficult to quantify, such as lower duplication of tasks (data entry), less data silos (inventory, production, sales, accounting).

HOW TO SELECT ERP SOFTWARE

 

Selecting ERP software is a decision-making process, as such, it comprises several steps. The decision maker needs first to handle the business problem to be solved by identifying its ins and outs. Once the problem circumscribed, the decision maker builds the space of potential ERP solutions, evaluates the capability of each ERP solution to address the problem, then compares them side-by-side to finally identify the ERP solution that best addresses the problem. Herbert A. Simon (1916-2001), a pioneer in the field of artificial intelligence (AI) and recipient of the 1978 Nobel Prize in Economics, has formalized this process by inferring it from his studies of how decisions were made in business organizations:

The first step, Intelligence, is responsible for structuring, or framing, the problem, while the remaining 2 steps, Design and Choice, address the solution to the problem. Together, the 3 steps comprise Simon’s IDC framework.

Simon's IDC decision-making framework provides high-level but robust and widely-adopted best practices for acquiring ERP software.

The rational decision-making process applied to ERP software selection thus becomes:

Intelligence: What Is The Problem?


The first step of Simon's IDC rational decision-making process consists of identifying the problem that is at the root of the decision to buy, replace, or upgrade an ERP system.

To do so, obtain clear information about the organization's current business processes and problems related to them. Then devise processes the way you would them to work. Based on that information, perform a gap analysis between both current and desired processes, which will allow you to create a list of ERP software requirements (ERP functions and features). Finally, weigh the identified ERP software requirements based on your organization's strategic, business, functional, and technical priorities (from not relevant to critical)

At this first step do not hesitate to use an ERP RFP Template for Discreet Manufacturing, it helps you speed up significantly the lengthy process of building that list of ERP RFP Template for Discreet Manufacturing software requirements. The ERP RFP Template for Discreet Manufacturing is a Microsoft Excel spreadsheet featuring multiple levels of evaluation and decision criteria.
The ERP RFP Template for Discreet Manufacturing can save you up to 90% of the time you would have otherwise spent building the list of ERP RFP Template for Discreet Manufacturing software requirements from scratch.

Download the ERP RFP Template Now!

Design: What Are The Different ERP Solutions?


The second step of Simon's IDC rational decision-making process consists of building the space of ERP solutions. Only ERP software solutions that are deemed responsive enough in regard to the ERP software requirements specification devised in step 1 will be part of your ERP solutions space.

To do so, identify potential ERP software vendors and their solution. The fastest and comprehensive way of doing it is to use the list of ERP software vendors that can be found in the ERP Software Comparison Report that was already built by our ERP consultants and ERP analysts using TEC Advisor, our online Decision-Support System (DSS). You may also complement it with ERP software vendors you are already aware of or met at an ERP trade show.

Once you've identified the ERP software solutions available in the market, you need to determine which ERP software vendors are likely to provide a solution that meets the ERP software requirements specification developed in step 1. This is done by evaluating each ERP solution against the ERP requirements specification that becomes your list of ERP evaluation criteria. A rating is thus apply to each ERP solution against each leaf evaluation criterion.

Once the evaluation of ERP solutions is done, disregard all ERP solutions which ratings don't meet the priority threshold you assigned to criteria that you deemed critical. The remaining solutions will constitute your shortlist of ERP software solutions. You usually end up with a "Top 10 ERP Systems" or "Top 3 ERP Systems" depending of the complexity of your acquisition project.

Using at this 2nd step an ERP software comparison reporthelps you speed up significantly the complex process of evaluating, rating, and comparing ERP software solutions. The ERP software comparison report is a table featuring side-by-side ERP solutions of your choice against your ERP software requirements.

Download the ERP Software Comparison Report Now!

Choice: What Is The Best ERP Solution?


The third and last step of Simon's IDC rational decision-making process consists of identifying the solution that bests fit your business, functional, and technical needs set forth in the ERP software requirement specification.

To do so, compare shortlisted ERP software solutions side-by-side by identifying all the differences between shortlisted ERP solutions in terms of coverage of your needs and based on your priorities. This is a very complex task that is not humanly manageable because of the high number of evaluation criteria to take into consideration amplified by the number of ERP solutions considered. As an example, the ERP requirements list usually contains more than 5,000 functions and features to be accurate, relevant, and exhaustive. If you compare a shortlist of 3 ERP solutions, you have to perform 15,000 (3 * 5,000) comparisons, without factoring in the priorities.

To overcome this complexity though, some decision makers are tempted to reduce the number of evaluation criteria to a few dozens, or hundreds for the most valiant. The consequence of this tradeoff is a less accurate, relevant, and exhaustive decision leading to a dreadful and undoubted risk of failure. Forensic of ERP failures demonstrates that taking shortcuts is one of the most critical failure factors in ERP implementation.

To help decision makers select the best ERP solution, Decision-Support Systems (DSS) like TEC Advisor assist buyers in seeking the ERP solution that maximizes the expected utility (UE). Such tools use advanced mathematical analysis based on what-if scenarii and sensitivity analysis, to name but a few techniques.

This 3rd and last step is the trickiest because you have to make a decision based on a process that is not humanly manageable because of so many solutions to take into account against so many decision criteria. There are also so many issues at stake: time, money, risks, and your own seat as the decision maker!

So a Decision-Support System (DSS) like TEC Advisor is here to help you speed up the decision cycle, lower the global project cost, alleviate your pain, and secure your decision-maker position by handling the mathematical complexity of the decision and giving you all the tools necessary to make a rational, impartial, and traceable decision.

Use TEC Advisor To Select The Best ERP Software For Your Needs!

TEC Advisor can save you up to 90% of the time you would have otherwise spent figuring out on your own which ERP solution is the best for your needs.

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Functions and Features