How Much Does It Cost to Implement an ERP System?

We are living in a digital age and everything is becoming advanced with time. Considering this, individuals or even big/small organizations cannot see their future without shaking hands with technology.

When we talk about businesses, implementing an ERP system has become a must to smoothen up the processes and improve ROI. Here, in this post, we are going to discuss what should be your budget to implement an ERP system in your organization. The cost of enterprise resource planning (ERP) will depend upon various factors including the size & type of your organization, its location, the type of system you want, and much more. We will talk about this in detail, but before we move ahead let us have a brief look at what ERP is.

What is ERP?

Abbreviated for enterprise resource planning, ERP is referred to the systems and software used to streamline industrial processes and simplify the activities to ensure effective monitoring and generate more revenue.

ERP software can automate most of the individual activities in your organization including customer relationship management, financial management, supply chain, and HR. Besides this, implementing an ERP system will also help you bring all these individual activities together and communicate effectively. Thus, you need to have a reliable ERP system to see your business grow.

How Much Does It Cost to Implement an ERP System?

Now, the real question here is how much you need to invest to implement an effective ERP system in your organization? If we talk about the average cost of ERP implementation, then small businesses will be required to pay around $10,000 to $1,50,000 annually whereas, this cost can rise to $7,50,000 for medium-sized organizations and more than $10 million for large businesses. The actual cost will be determined by various other industrial factors other than its size including the level of customization and on-premises deployment or cloud ERP.

Before we wind it up, here are two important ERP system pricing models that’ll help you effectively decide what actually will fit into your budget and needs.

Pricing Models of ERP System

Perpetual Licensing

Perpetual licensing is required for on-premises deployment. This means businesses want to host ERP software on their own servers. Thus, they are required to pay a one-time fee to get a perpetual license. Here’s a catch with this, the fee a company is required to pay will depend upon the number of users of the ERP software and the customizations you’ve asked for. It is seen that a perpetual license generally doesn’t require any maintenance or upgrade cost.

Subscription Plans

This is a better option for companies with a low budget as, with this option, companies can subscribe for monthly or annual plans. One point to be noticed here is that the ERP software will be hosted on a third-party server. This pricing model is also known as Software-as-a-Service (SaaS).

Conclusion

We hope that now you would have got a better idea of the basic cost required for ERP implementation along with the factors that control it. So, if you are low in budget, it is advised to choose the subscription plan because hosting the software on your own server is accompanied by infrastructure and training costs as well. While on the other hand, if budget is not an issue, then you must go for perpetual licensing.

Make your decision wisely and enjoy the benefits provided by the ERP system.

How ERP Software Has Changed Business Forever?

ERP stands for Enterprise Resource Planning. It’s heavy-duty software that touches every aspect of operations. It’s a software package through which an organization achieves an integrated system of data and processes. An ERP system combines all the elementary functions of an organization irrespective of its business or charter. ERP software unifies all departments and functions in a company onto a single computer system that server the specific needs of all those departments.

A Powerful ERP software helps business owners and other executives to streamline and automate difficult back-office jobs. It also aids other staff members of an organization to become more successful and productive in their assignments as well as access required data in real-time.

Advantages of ERP systems

In general, in an organization, particularly a large organization, there are multiple on-going processes to do with manufacturing, accounting, finance, sales, and various other tasks. With ERP software, integration of these various processes into a software application is possible, which can be used across the organization. Integration of these diverse processes and diverse parts of the organization has numerous advantages.

Without ERP, an organization would be using multiple software packages to deal with the above-mentioned processes. All these packages may not work well together and inconsistencies may emerge. With ERP, integration of these processes is possible and inconsistencies can be avoided.

Having a fragmented set of the processes can cost time and money. However, integrating them with ERP software can therefore constitute a saving of both.

With ERP, you don’t need to spend much time converting between different systems to compare, for example, sales data with data from customer service. Instead, it is all in one place.

With the use of ERP, there is less requirement of paperwork and documentation. There is a need to enter data in multiple locations or on multiple systems.

An ERP system can help you in storing and collecting data into a singular place from diverse facets such as:

Human Resources

Production Management

Warehouse Management

Inventory Management

eCommerce

The Latest Trends of ERP systems

Currently, ERP connects all functions and areas within an enterprise, with the sole aim to aid managers and business owners to better comprehend all animated facets of their business; carry of effective decisions and identify opportunities.

ERPs are utilized by companies of all sizes, small and large. Today there are two basic kinds of ERP systems used by businesses:

On-premise ERP – This is an ERP system which is installed locally into your servers and hardware and is monitored and managed by employees in your IT department.

Cloud-based ERP – A cloud-based ERP is a system that is monitored and managed from a different location by a provider.

Future of ERP system

A lot of companies are today handling an increased variety of services, customer interactions, marketing activities, and goods. This is going to initiate ERP systems to get more transactions and result in businesses demanding new ERP systems that are cloud-oriented. Not only systems that are cloud-based but also those that are capable of handling cloud-based enterprises.

Also, new ERP systems will be developed increasingly on architecture featuring innovated cloud design. This will be developed from scratch to handle lots of computational challenges of transacting global organizational data minute by minute.

The Indispensable Features in an ERP Software

Enterprise Resource Planning is a business management software used by organizations from various industries. It is designed to integrate and manage the core business processes of an organization. It collects, stores, manages and interprets data from a diverse range of business activities using a suite of integrated applications to streamline the whole process. It eliminates chaotic data transfer, human errors and security gap by integrating separate work processes into one system which can be accessed through a unified interface. It provides real-time data of the company’s daily operations and is an effective cost reduction tool to save administrative and operating costs.

ERP Software consists of a customized suite of integrated applications that caters to the various departments of an organization like the administrative department, accounts, purchase, production, human resource, inventory, sales, customer relationship management to name a few. Companies from a diverse range of industries and of all sizes are transitioning to cloud ERP systems these days. They understand its benefits that include an increase in organizational efficiency as well as a reduction in human errors by automating the entire process. With all its advantages, it has emerged as the best business management software in 2020.

Before you decide to invest in an ERP software, you must find out if it has the essential features that we will be looking at in this blog.

Since every organization has its own security concerns, requirements related to update and configuration as well as flexibility needs, each company needs a different hosting option that caters to its specific needs. You must make sure that your ERP software provider is not limiting you by imposing his choice of hosting option onto you. You should have the freedom to decide and choose when it comes to the fact that whether you want your new solution to be hosted on your own servers (on-premise ERP), on a cloud, or on a hybrid cloud (when a company uses a mix of public and private cloud services). Offering different hosting options is one of the most essential features of an ERP software.

Mobility is something that you must consider having in your ERP software. Having mobile access is no longer a futuristic ERP feature. A mobile-friendly ERP dashboard will give your employees on-the-go access which is very beneficial in this day and age where most workers access data and workflows on their own devices. Thus, having a mobile version is a very important feature. It makes it possible for the employer as well to know how his business is doing at any particular point in time.

Platform scalability is another important feature that you need to look for. Your business will keep on growing and so will its requirements that will change over time. Hence, your ERP software cannot remain inflexible to these changing needs. The decision to update your ERP system, will turn out to be a costly choice. That is why you need to make sure that your ERP software offers you a scalable solution that will be flexible enough to adapt to your future needs. Otherwise, you might end up in a position where you have to change your ERP solution regularly, or you will have to start using additional applications to take care of all your business needs.

An ERP software should be user-friendly.ERP solutions are complex systems with many functionalities that are designed to streamline and automate your business processes. If your ERP software is not user-friendly and is too complicated to use, then the whole purpose of reaping any benefit from it,will be defeated. The investment made on the ERP software will not earn any profit in this case and the purpose of increasing the company’s productivity will not be met despite having invested in an ERP tool. In order to avoid making this mistake, always make sure that you request a demo before deciding on investing in any ERP tool as the ideal solution for your organizational needs.

Apart from these features it should offer easy integration and must have the necessary modules that include but are not limited to CRM and sales management, finance and accounting, HR management as well as business intelligence tools which help the company to analyze its performance and take better decisions.

An ERP software streamlines and simplifies lengthy workflows and accelerates response time by using an integrated database to increases operational efficiency and productivity. It monitors and manages daily operations and helps make informed decisions to facilitate business data analysis and saves time. It offers a wide range of benefits but unless it has the basic and most essential features that have been discussed here, it will prove to be of no use and will fail to fulfil the aim of increasing organizational efficiency and overall productivity. Hence, you must make an informed choice and look for the presence of all the essential and basic features when opting for ERP software for your business specific requirements.

ERP Software – Enhancing Your Ability to Do Business

What is ERP?

ERP stand for Enterprise Resource Planning. Even though the term does sound very new, its use dates back to the 1990s. Yes, ERP- the term itself was coined by Gartner in the year 1990.

Now, not delving too much into the history of ERPs, let us try to understand what ERP really is. Enterprise Resource Planning (ERP) basically refers to a system or software that is used to create an inventory of all the functions of a business at a single place. This means that the business owner will be able to view all the transactions of their business- be it management, payroll, budgets, hirings, and much more- at one place, on a single server/ system.

Types of ERPs

To be able to select the best ERP software / system for your business, it is utmost important to know the types or varieties there are for you to choose from, and which one in particular best suits your business and interests.

In case of Enterprise Resource Planning (ERP), let us discuss the three most common types of ERP systems, i.e, On- Premise ERP, Cloud- based ERP, and Hybrid ERP.

In case of On- Premise ERP, as the name suggests, the resource planning software is hosted in the client’s office premises itself. This means that the business owner has complete control of the software. How does this happen? Well, not only is the ERP software is hosted in their own business premise/ office, the software is in fact hosted and maintained on the client’s own system and server. This gives the client unhindered ownership of the software as well.

Moving further, Cloud- based ERP software is a web- based system, and is commonly known as Software as a Service (Saas). Here in, the client purchases an external server and stores the company’s data on this particular system. To make cloud- based ERP a possibility, it is important that this external server is purchased by the owner of the business (usually through a subscription), the purchase is made concrete through a SaaS Agreement, and most importantly, the external system or server has an uninterrupted internet connection.

Now, what is Hybrid ERP? As might be evident, a hybrid enterprise resource planning software is a mix or a combination of both the above types. A hybrid ERP system helps the business/ company choose the best of the On- Premise and Cloud- based ERP software systems. Hence, it can be said that in this type of software system, the user gets the integrated best of both worlds. This feature also provides the client/ business owner a lot of flexibility in delivery options and other functions.

Conclusion

In today’s fast- paced world, we all desire to have a single access point to fulfill all our necessities and demands. To business owners, ERP provides just that- a single inventory for all their business needs! At HTS Solutions, we provide the best services for ERPS and other technical services keeping in mind the client’s needs, demands, and comforts. Click here to checkout all our services!