Benefits of ERP Systems - Article Example

Business entities that embrace ERP systems attain a competitive advantage through improved business performance (Hitt et al., 2002). This is because it integrates supply chain management, production planning, and management, human resource management with other core business functions. Already, this allows the company to realize a multidimensional improvement. ERP systems enable firms to reduce lead times, improve financial management, and properly coordinate information. Oracle ERP systems are strategic. This means that they concentrate on improving company sales, improving customer service, and reducing lead time.

Business regulations deter most companies from realizing their set goals due to costs associated with compliance and administration. Therefore, through the use of ERP systems, firms can avoid such costs, and in return improve processes, which can enable them, to meet customer demand. Strategically, firms using ERP attain cost leadership, because they have synchronized economies of scale in operations.

ERP systems make every department accountable to all activities in their jurisdiction, and thus make them utilize proactive problem-solving techniques as compared to reactive ones. Such employee involvement in business operations ensures satisfaction among customers, shareholders, management, and employees themselves.

An Oracle ERP system is scalable because it is very easy to modify and upgrading its functionality is achievable. This means that companies using such systems can manage and coordinate activities among all their existing departments for improved efficiency.

ERP improves reporting capabilities in operational work. Therefore, it is easy for multiple departments to access information instantly, and when change is required. Therefore, organizations can get feedback. In addition, it provides user departments with quality data, unlike manual record-keeping data.