The Coronavirus has introduced fear and uncertainty throughout the globe. As a result of which, businesses are changing their value propositions on a daily basis.
Supermarkets, while enjoying the sudden purchasing peaks, are suffering from shortages due to hoarding. Distilleries are converting to manufacture disinfectants. Factories are converting to produce ventilators. Restaurants and pubs meanwhile, are switching from in-house service to take away, and retail outlets are converting from in-store to online shopping only.
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Finding the right business strategy to maintain profitability is challenging. With the current instability, the business models of many companies will change, and their supporting IT systems will need to change with them. And one day, hopefully soon, the world will change back to the way it was, and businesses will need to adjust, and make changes yet again.
Flexibility is a Game Changer
In short, ERP is business process management software that allows an organization to use a system of integrated applications to manage different departments, such as finance, customer relations, sales, distribution, and others. ERP uses a centralized database for various business processes to reduce manual labor, and simplify existing business workflows. More importantly, users can view real-time data collected from all departments to measure productivity and profitability, for a real 360o view of their business operations.
Here are the five ways ERP systems will need to be flexible.
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Finding the optimal suppliers – Supply chains are fragile due to employees being stuck at home in quarantine, factory closures or manufacturing slowdowns, and the lower availability of logistics services. ERP systems need the flexibility to switch out suppliers to support automation for every stage of the purchase process, from price offers to processing payments. In order to facilitate vendor selection, ERP solutions should be integrated with systems that identify potential suppliers and automatically compare terms and conditions to recommend the best source.
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Automatic integration for shipping – Where almost everything is now delivered door to door, delivery services will become a critical part of every sales offering. There is the risk that customers will look for alternatives if deliveries are delayed. Systems will need to be flexible to enable companies to view, evaluate and select the fastest, most reliable shipping and delivery method on a case by case basis, in real time, to keep deliveries flowing smoothly.
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Developing online channels – With the closing of malls and many retail outlets, many stores must rely on an online presence to sell their products and services. ERP systems need to provide seamless integration with e-commerce platforms, so that retailers can provide real-time updates of inventory, availability, pricing, and delivery dates to their online customers.
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Making products available on e-Hubs – As online orders increase, aggregation sites that enable consumers to choose between different vendors, are becoming more popular. These aggregation sites are also ideal for smaller retailers, as they can often provide companies with preferable credit terms and logistics services. ERP systems need the ability to feed data to aggregated online marketplaces, including reconciliation with back office systems.
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Scaling up and down – The long-term effects that the Coronavirus will have on businesses, is unclear. What we do know is that companies that provide online content streaming, video conferencing, cleaning solvents, masks, and other medical supplies, are experiencing a peak in demand, while others are scaling back with the cautious optimism that the slowdown is only temporary. Therefore, regardless of what the future brings, companies need the ability to track supply and demand to maintain optimal inventory levels, while scaling up or scaling down. If an ERP system is integrated with an analytics program, for example, companies can simulate different scenarios based on different levels of labor and sources for third party services, parts and materials, to maximize their overall efficiency and profitability.
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ERP systems, the information backbone of an organization, needs the ability to turn on a dime, for new integrations, and partners, and to scale up and down to give companies the flexibility they need to survive in critical times. ERP systems with open APIs enable organizations to share data with third parties to streamline business processes, with the possibility to feed data to analytics programs, to better manage the supply chain and inventories. Flexible companies, especially today, need flexible ERP systems to optimize operations based on new business realities.