According to a report by Market Research Engine, “The ERP market size is expected to exceed $49.5 billion by 2024.” Modern businesses rely on Enterprise Resource Planning (ERP) systems to help them collect, organize, and manage financial and operational data in a shared database to promote better efficiency.
What are ERP modules?
ERP software comprises many modules, built to address various business requirements. Each module derives information from specific areas of business and pushes it into the central database. An organization can buy only the modules as the requirement of their business model, key challenges, and operations. Further ERP modules can be added to address new challenges or needs as the organization evolves.
What Are the Types of ERP Modules and Their Benefits?
The finance and accounting module allows businesses to understand their current financial performance and future outlook. The key features of the finance module include tracking accounts payable (AP) and accounts receivable (AR) and managing the general ledger. It automates tasks related to cash management, account reconciliation, vendor payments, and compliance with revenue recognition standards. This module also has the data required for key business reports, including board reports, and profit and loss statements.
The procurement or purchasing module helps in securing the products required for manufacturing. This module automates requests for a quote and tracks and analyzes the quotes. It also helps the purchasing department prepares and sends out purchase orders.
Read More: Benefits Of Automated ERP For Small Business
The manufacturing module helps manufacturers plan production and ensure they have everything they need for production runs such as machinery capacity and raw materials. It provides a real-time overview of the shop floor and captures information on items in progress and finished goods.
4. Inventory Management
The inventory management module control and manages inventory by tracking item quantities and location. It offers a complete overview of current and incoming inventory through integration with the procurement tool. This module helps in managing inventory costs while ensuring sufficient stock without tying unnecessary cash in inventory.
5. Order Management
This module tracks orders from receipts to delivery. It helps in feeding all orders to the warehouse, distribution center, or retail store, and tracking the order status as they are prepared, fulfilled, and shipped to the customer. This module boosts on-time delivery and prevents orders from being lost and determines the most effective ways to fulfil orders.
6. Warehouse Management
A warehouse management module helps businesses plan labor based on expected order volume. It supports different picking strategies like zone picking, batch picking, and wave picking depending on its efficiency for the business. It also integrates with order and inventory management applications to speed up the delivery process and increase customer satisfaction.
7. Supply Chain Management
This module tracks every movement of goods and supplies throughout the supply chain, from suppliers to sub-suppliers to manufacturers to distributors to retailers or consumers. It also manages the products returned for replacement or refund.
8. Customer Relationship Management (CRM)
This module stores information about prospects and customers. It includes the communication history with customers and improves customer service. It can also be utilized to manage sales leads, track communications, and helps in customer segmentation.
9. Human Capital Management
This module encompasses all features of workforce management including employee records, attendance, performance reviews, offer letters, overtime hours, payroll, and similar key performance indicators.
This module is offered for businesses that sell online. It allows businesses to quickly launch a business-to-consumer (B2C) or business-to-business (B2B) ecommerce website. When an ecommerce application is integrated with other ERP applications, the inventory, order, and payment information feed from the ecommerce module into the shared database. It ensures that all transactions are added to the ledger, orders are shipped on time, out-of-stock items are removed from the site, and much more.
How to Choose the Right ERP Modules for Your Business?
While the selection of ERP modules varies on the business model, current obstacles, industry, and many other factors, there are a few modules that are required by most organizations to run their business operations. Purchasing and implementing the right ERP module for your business can be a daunting task but, in the beginning, it is best to select the ERP modules that meet your business needs right now and scale according to future requirements. Learn more about ERP modules and their business benefits.