Enterprise Resource Planning (ERP) Software: Complete Buying Guide

Businesses have transitioned from deploying minimal tech to streamline processes to using new-age technology. Today, it is hard to imagine a business operating without using the best inline technology solutions to increase profitability and make their processes more efficient.

The adoption of ERP software across small to large-size businesses has increased multifold over the past decade, and the trend is expected to continue in the future.

In this article, we will take a look at everything you need to know about ERP systems, ERP software benefits, factors you need to consider before purchasing one, and some of the top ERP systems in the market.

If you are looking for an insightful guide that will help you understand ERP’s functionalities, pricing points, benefits, and everything else, continue reading.

What is ERP?

ERP is a popular acronym for enterprise resource planning. In simple terms, ERP software is a business process management solution that integrates and manages different business processes.

Some of these processes include reporting, supply chain, manufacturing, operations, financials, and human resources. Although a lot of companies opt for an operational and finance system, most of these solutions cannot handle day-to-day business operations.

As companies scale, their requirements and demands change over time. This is why enterprise-grade systems such as ERP software should also be able to scale along with a company’s growth.

What is ERP software? Past and present.

If you look at the past, ERP software was a standalone solution that could not be integrated with other systems. Every system demanded complex, customized, and expensive code to cater to niche business needs. This hindered and on many occasions prevented the adoption of new technologies or process optimization.

Modern-day ERP software is unique and brings a lot to the table by binding various business processes together. You may wonder which ERP software may work best for your business.
Apart from offering data connectivity within your ERP software, it ties together various e-commerce, productivity, and customer engagement solutions. Enterprise-grade tech solutions are primarily focused on connecting different sets of data to offer clear insights that can be used to optimize different business processes across a business.

Besides, today’s ERP solutions also provide enhanced security and privacy, sustainability, flexible deployment, low-code customization, and sustainability. It also builds continuity and consistency across business processes due to valuable insights. These insights enable swifter innovation and groom your business to face new challenges head-on.

Why is ERP so important for your business?

Today, although there is software to handle different business processes, we still haven’t found an all-in-one solution yet. Having said that, ERP technology has improved consistently over the years and done an incredible job in gluing different business processes together.

When different systems, data, and processes are connected, businesses get the acceleration, intelligence, and adaptability they require to streamline their operations and become more efficient.

Here are a few ways how an ERP can enhance your business.

• Optimal performance

AI-powered ERP systems provide valuable insights that significantly improve your decision-making. Besides, you can also find new ways to enhance your operational performance in the future.

• Business agility

Modern-day ERP software is designed to adapt to your business requirements and scale along with your business. These solutions help you adjust to operational disruptions and effectively respond to market changes.

• Operational impact

When you use an ERP system, you are connecting data and processes that offer flexibility and visibility to employees that help them in their decision-making process and add more value to your business.

Which business functions can benefit from ERP software?

ERP systems have the ability to look into a plethora of core business functions. This helps in eliminating any barriers between the back and front office while providing the ability to adapt your system to emerging business needs.

Some of the core business functions that benefit from ERP software include:

• Finance

Modern ERP systems allow you to boost profitability while pushing for compliance. It provides AI-driven insights and dashboards that offer a bird’ eye view of your finances. You have access to real-time data from any location at any time.

Besides, ERP software cuts down the need for manual data entry by automating recurring tasks. The tracking capabilities allow businesses with regulatory compliances and stay clear from trouble.

• Human resources

Many modern systems provide different ways to handle company information and also organize employee management tasks such as hiring, payroll, onboarding, and more. With an ERP, you will be in a much better position to retain, empower, and recruit more employees. What is even more fascinating is that you can do all of this while tracking employee performance and identifying bottlenecks in HR even before they happen.

• Manufacturing

The manufacturing function enhances business communication, automates routing processes, and also provides manufacturers the chance to fulfill their customer demands. Besides, manufacturers can manage their resources by accessing real-time information.

• Supply chain

Does your company enter data and track down inventory in the warehouse manually? You can save considerable time and money when these processes are automated by ERP software.

A host of modern ERP systems come with intuitive dashboards, business intelligence, and the internet of things (IoT) to cater to inventory management.

• Commerce

Retailers face plenty of challenges that can be easily overcome with an ERP system. An ERP provides an omnichannel solution that brings together in-store, back-office, and digital experiences.

Customers are expected to be at the receiving end of seamless and personalized shopping experiences with the help of AI-generated recommendations. All in all, retailers can boost productivity, minimize fraud, and expand their business.

Why do some businesses shy away from embracing ERP?

Although there are multiple options to choose from, a lot of companies are still unsure about investing in ERP software. Which ERP software will best suit the company? What are the reasons why these companies are skeptical about embracing ERP?

There are plenty of reasons for that, but it is important to understand that every doubt can be cleared and every challenge can be tackled.

Here are a few reasons why companies are on the backfoot when it comes to selecting an ERP software best for their business.

• How do I know that I have chosen the right ERP system for my business?

You do not have to go looking for a software system that will fix all problem areas of your business. An ERP system should essentially bring your main business processes together under one solution. Besides, every member of your team or company should be able to view all the information without any hassles.

This is how you can determine whether you have chosen the right ERP vendor for your business.

• We cannot afford to invest in ERP at the moment

Did you know one of the most spoken about ERP software benefits? One of the main advantages of modern-day systems is that you do not have to go all-in and purchase the entire solution. You can choose different software modules depending on your business needs.

This means that you will only pay for the modules you will use. This offers two advantages – one, you do not have to go through a long implementation process, and two, you do not have to spend heavily on the entire ERP system.

• We do not want to stop using our existing systems

As mentioned before, there are plenty of ERP software systems that will best suit your business. However, many businesses are unaware that ERP systems can offer something more than what their existing system is offering. Besides, a number of ERP tools can now be integrated into third-party systems, making it easier to use two technologies together.

Besides, if your existing software lacks the business intelligence module, you can invest in an ERP that offers exactly the same. This way, you can ensure that the features are not overlapping and you are not overpaying unnecessarily.

What are the key functions or features of ERP software?

With so many ERP tools available in the market, how can you distinguish one from the other? Well, one way to do that is by comparing the feature-set of different tools.

Keep in mind that most ERP software will offer almost the same features. However, apart from the standard set of features, you should look out for vendors that offer unique features that are not available in all ERPs.

Here are some of the most common features that can be found in ERP software.

• Accounting

Accounting is one of the most standard and common features of an ERP tool. It enables businesses to automate their main accounting operations such as fixed asset tracking, payroll, and more. Since an ERP consolidates different business processes, users can assess the financial data of their company through a single system.

• Business intelligence

Business intelligence offers companies in-depth analytical data and insights that allow them to evaluate business performance in just a few seconds. Today, an array of ERP systems come with intuitive dashboards that can be customized to display operational data. These dashboards offer business data to decision-makers in the format they want, making it easier to make informed decisions.

• Customer relationship management (CRM)

The CRM module of an ERP software handles customer data, ranging from client data, prospective lead’s information, to live chat interaction. The CRM function not only provides an accurate and comprehensive view of customer information but also enables the automation of various client-related activities such as order processing.

• HR management

You may wonder about the other ERP software benefits, and you will be surprised to find out that ERP also broadens the scope of HR. It automates the main HR functions including payroll management, timesheet processing, and benefits administration.

An ERP also offers advanced reporting capabilities and employee information, that aid in employee evaluation, recruitment, and strategic initiatives.

• Inventory management

Modern-day ERP software comes with AI-powered inventory tracking which allows businesses to maintain supply levels while preventing product outages and overstocking.

The tool’s predictive analytics function can predict an increase or dip in demand, and also send out notifications when inventory levels get low.

• Supply chain management

As the name suggests, the supply chain management module handles and organizes your company’s supply chain processes. These include procurement, production, and distribution.

It also includes functions such as cost optimization, delivery efficiency, demand tracking that is powered by the ERP software’s real-time inventory management functionality and process automation.

What are the different types of ERP software?

• ERP in a box

ERP in a box is a metaphor or a phrase used to describe ERP software that is extremely easy to install and use. However, this type of ERP software cannot be customized or configured with ease.

They are readily available to be deployed immediately for core business functions. You do not have an option to add extra functionality as they are very ridged but are an excellent choice for small businesses that do not have a large budget to spend on an ERP.

Examples: monday.com and QuickBooks

• Complex ERPs

It is easier to understand a complex or large-scale ERP system as a framework. The ERP vendor offers a set framework from which software is developed.

As the developers start developing the tool from scratch, it can take a lot of time to develop and create a final product.

Examples: Sage M3 and SAP R3

• Intermediate/Flexible ERPs

These ERP tools are a mix of complex and ERP in a box. Since these ERP solutions are not as ridged as ERP in a box, they provide great flexibility and can be tweaked according to your requirements.

If you want to know more about flexible ERP software benefits, here is one. Apart from the ease at which you can customize intermediate ERPs, they are also very cost-effective, which is why small to medium-sized companies prefer using these tools.

Examples: SAP, monday.com, Netsuite, Odoo

• Industry-specific ERP software

Talking about ERP software benefits, you would be fascinated to find out how some solutions can be customized and modified according to specific industries. This software comes with a range of features that are industry-specific. However, when it comes to configuration capabilities, they are generally absent.

Best ERP Software and Solutions for 2022

As mentioned in the earlier section, there are different types of ERP software that are available today. With so many choices out there, choosing an ERP software best for your business may not be as straightforward as it seems.

Right from the ERP software benefits, features, and pricing to the integrations, there are plenty of factors that need to be considered. We will discuss these factors in the following section. But before we get there, let’s take a look at a few ERP software that may be the best choice for you.

Take a look at these ERP software systems and choose the most suitable tool from the list.

Oracle Netsuite

Best for: Small to medium-sized companies

Netsuite was acquired and is currently marketed by tech heavyweight Oracle Corp. What makes this ERP software best for your business? It offers five core modules which include CRM, ERP, human capital management, professional services automation, and e-commerce.

You can also use NetSuite OneWorld to use Netsuite with different currencies and also manage the subsidiaries of a company.

Features:

• Financial management features that come with pre-made business intelligence.
• Financial planning functions that cut down cycle times and enrich the entire planning process.
• Order management features to fast track order to cash process.
• It offers all the key features you need to facilitate seamless warehousing, order fulfillment, procurement, production management, and supply chain management.

Price: Ask for a quote from the vendor directly.

SAP S/4HANA

Best for Large-sized companies

When we are making a list of ERP software best for businesses, it is impossible to not include SAP S/4HANA in it. In the ERP world, there is no doubt that SAP is among the top vendors out there. In fact, SAP tools are extensively used across different industries, which is why it has a dominant market position.

SAP S/4HANA is SAP’s ERP business module that is primarily used by large enterprises. SAP S/4HANA offers real-time data analysis and can also be deployed as an on-premise, cloud, or hybrid ERP software.

It is loaded with an in-memory relational database management suite which is called HANA. It is primarily used for advanced data processing and analytics.

Features:

• The ERP software comes with pre-built intelligent technology such as machine learning, AI, and advanced analytics.
• The software is packed with an array of features and functionalities
• making it a popular choice for companies across different industries.
  Simplified data model and in-memory database.

Price: Free trial for 14 days is available. Request for a quote from the vendor for your enterprise.

Microsoft Dynamics 365

Best for: Small to large enterprises
Microsoft Dynamics is Microsoft’s CRM and ERP product. There are a bunch of Microsoft’s products that are part of the Dynamics line including Dynamics NAV, Dynamics AX, Dynamics GP, and more.

Microsoft Dynamics 365 can be seamlessly integrated with other Microsoft products including MS Project Server, PowerBI, and more.

Features:

• The CRM and ERP functionality are available on the cloud
• It comes with modules such as sales, marketing, finance, operations, and more.

Price:

Since this ERP system can be used to handle processes in different business areas, the pricing changes accordingly.

Prices for different modules are mentioned below:

• Marketing: $750 per user/month
• Sales: $20 per user/month
• Customer service: $20 per user/month
• Finance: $30 per user/month

Epicor ERP

Best for: Small to large enterprises

Epicor ERP is primarily developed for distributors, retailers, service providers, and manufacturers across businesses of all sizes. The vendor offers Retail and ERP solutions with seamless integration with e-commerce, customer relations, and Point of Sale (POS).

Another reason why Epicor is an ERP software best suited for your company is that it leverages the latest technologies. Some of these include cloud computing, mobile technology, BigData, and more. In fact, the look and feel of Epicor are similar to that of Windows – making it an excellent choice.

The platform can be deployed on-premise or on the cloud.

Features:

• Epicor Collaborate facilitates social media-Esque communication
• Epicor Virtual Assistant will help you organize your daily activities
• The DocStar ECM component will allow your teams to ace content workflows
• The interface is very modern and can be understood easily.

Price: You can get in touch with the vendor and request a quote according to your requirements.

Sage Intacct

Best for: Small to large businesses

Sage is considered to be one of the top-rated cloud-based financial ERP software for small and mid-sized businesses. Although the tool primarily focuses on the Finance and Accounting side of the business, it comes with different modules such as purchasing and order management.

Apart from these modules, Sage Intacct also provides added modules including fixed assets, expense management, inventory management.
Features:

• The platform can perform multidimensional data analysis.
• Sage can be seamlessly integrated with other popular third-party applications such as ADP, Salesforce, and more.
• The automation features make it extremely easy to streamline the most complicated processes.

Price: You will get a free trial for 30 days.

The software is priced at around $8000 per year for a single user and around $50,000 for organizations.

Acumatica

Best for: Small to medium-sized businesses

Acumatica is a very popular cloud-based ERP software. If you are looking for a cost-efficient ERP software best suited for your business, Acumatica is a top choice.

It provides different versions of the ERP system such as distribution edition, manufacturing edition, commerce edition, field service edition, and general business edition.

When you are dealing with cloud ERP software, the benefits are evident. Acumatica is a cloud-based ERP system that provides real-time insights at any place from any location.

You also have the option to deploy is an on-premise solution.

Features:

• The General Business Edition comes as a complete package that comes with functions such as project management, accounting, reporting, financials, and business intelligence.
• Manufacturing edition offers functionalities for sales orders, inventory purchasing, customer management, and more.
• Each process of the field services can be tracked and optimized with features including warranties, contracts, service orders, appointments, and more.

Price: Get in touch with the vendor directly and request a quote.

ERP Software benefits

There are many benefits that come along with an ERP system. Most companies can reap the benefits immediately as their efficiency levels along with revenues move in the right direction after deploying an ERP solution.

When we talk about ERP software benefits, it should be highlighted that an ERP system binds together different business applications to create a unified solution. This prevents the need to toggle between different applications as they are tied together in a single system.

Let’s take a look at some of the most important and noteworthy ERP software benefits.

• Enhanced employee productivity and experience

One of the most important and notable benefits of an ERP solution is that it can take employee productivity to a higher level. This is possible because an ERP tool comes with automation functionality that automates your recurring routing processes.

Since all the applications are present on a singular system, users do not have to switch between applications. If deployed strategically, an ERP has the ability to completely eliminate the need to perform repetitive manual tasks.

This means that employees have more time to focus on important tasks that generate revenue. All in all, an ERP solution plays an important role in boosting the productivity and efficiency of employees.

• Improved organizational visibility

An ERP offers a comprehensive view of all the key processes that impact your business. As data from different departments can be accessed easily, you have updated and timely reports on your employee activities.

For example, you are just a couple of clicks away from knowing how many new faces have joined the sales and marketing team. Hence, based on the module you are using, you can pull out information in just a few seconds without wasting a lot of time.

This ensures that different teams can collaborate with each other and also paves the way for organized workflow by removing the hurdles within a company.

Members from all teams can see the actions taken by members from other teams. This allows better coordination of activities and also ensures that all employees share the same vision.

• Reduced costs

It is true that the pricing points of some ERP tools can instantly put you off and discourage you from implementing the same for your business. However, as different tools and functionalities are consolidated in a single ERP solution, it eventually becomes more feasible in the long run.

Besides, even the training costs will go down as your employees need to understand the nuances of only one system.

Talking about ERP software benefits, integration is another unmissable advantage most of the top ERP vendors offer. For example, if you are not willing to let go of one of your current applications, you can integrate them with an ERP system.

Some of the top ERP companies such as Odoo can be integrated with other third-party applications.

• Efficiency
  

When you have the option to go through all your business processes through a single lens, your company can function more efficiently. When you deploy an ERP system, the quality of data improves as there are no duplicate entries and data errors.

Interconnected ERP systems play an important role in enhancing the data quality of an organization.

What are the factors that need to be considered while selecting an ERP solution?

One of the ways to assess whether an ERP software is best for your company is to see how it can evolve with your company’s growth. If the software can easily scale along with your company and provides all the features you need, you are making the right choice.

These are a few points you should consider while choosing an ERP software best for your company.

Ideally, you should be looking for a solution that is flexible, modular, and easily adaptable to your company’s growth. As mentioned above, ERP systems come in different types. Selecting software that is scalable ensures that the system becomes your company’s best friend for years to come.

Here are a few important factors to consider while choosing an ERP solution for your company.

• Notoriety

Is the solution popular? Are there enough reviews online which you can go through before selecting a software? Conduct thorough research and find answers to all your questions before you select a tool.

• Flexibility

Can the ERP system be customized easily? How difficult is it to add new modules as your company grows?

• Dynamic

Look for a dynamic ERP software that is best suited for your company. Does this mean that find out how often does the vendor roll out new updates? Does the company focus on improving its product consistently using customer feedback?

• Functionality

This is arguably the most important factor if not the most important. Try to evaluate whether the software can cater to all your business requirements. You should be able to figure out if the ERP applications can cater to your business functions.

• Documentation

Does the software provider provide sufficient documentation, training, and learning material? If you prefer learning via videos, does the vendor have a repository of e-learning videos?

• Accessibility

Can you access the ERP system across different devices? Can you deploy the tool as an on-premise solution or on cloud platform? What if I want to have access to certain modules on-premise? Will I have that option? These are some of the questions you should ask yourself before selecting an ERP solution.

Recent trends in the ERP software industry

Typically, ERP was not easy to change. However, thanks to recent developments at the technology front, things have changed considerably in the ERP space. Vendors are rolling out new updates, features, and modules more frequently than before.

Let’s take a look at some of the emerging ERP trends.

• A growing interest in cloud ERP

Although businesses of all sizes are deploying cloud ERP systems, its adoption is growing consistently among small to medium-sized businesses. The increasing adoption can be driven by the cost benefits associated with a cloud-based ERP. Besides, some of the other cloud-based ERP software benefits include low upfront costs, no responsibility for maintenance, and flexibility to scale as the company grows.

• Entry of industry-specific ERP systems

This trend can be seen across the enterprise technology space as more and more vendors are looking to develop industry-specific solutions. In fact, the demand for ERP systems that are tailored to address the requirements of particular industries has increased significantly.

This is why ERP solution providers are offering customized solutions for each industry.

• The rise of mobile ERP

We can see more and more companies around the world that are allowing employees to go through company resources on mobile devices. A lot of ERP vendors are capitalizing on this trend and rolling out mobile-friendly ERP systems. One of the biggest advantages of a mobile ERP solution is that users can perform business-related tasks and access company data from any location on the go.

• Adoption of AI

Artificial intelligence (AI) has spread its wings across a plethora of industries, and the enterprise tech space is no exception. With excellent progress made in the AI field, ERP vendors are not hesitant to leverage AI to create better and more refined products.

The increasing usage of AI while designing ERP solutions is expected to eliminate human errors and increase the quality of data being used. AI-powered ERP systems allow companies to make faster and better decisions.

Some parts of accounting, human resources, and even customer service will be driven by AI – a trend we expect to see in the future.

ERP Software FAQs

What are the key functions of ERP?

• Workflow automation
• Streamlined operations
• Improved accessibility
• Advanced analytics

What questions should you ask a vendor while assessing an ERP solution?

• How much will the software cost?
• What long-term strategies are in place to improve the product?
• What support options do you offer?
• How compatible is the solution with new technologies?

What are some of the drawbacks of implementing an ERP?

There is no running away from this. If you want to implement an ERP successfully, you should be ready to spend a significant amount of capital. Besides, you need a great amount of exhaustive preparation. Without these two aspects, it will be difficult for you to implement an ERP successfully.

Keep in mind that an ERP is not a very viable solution for all businesses, particularly for small businesses with less capital. Having said that, the barriers to entry are much lower than ever before, making it one of the most exciting times for both end-users and software companies.