Role of ERP in Supply Chain Management

In the digital era, business automation is the need of the hour. As the pressure mounts on businesses to become smart and more streamlined, industries are speeding up the process of adopting suitable technologies across the spectrum of company operations – including supply chain management. Implementation of the right tools at the right time can help companies to enhance the quality of workflow and information management, improve levels of productivity, and operation churn. In this blog, we aim to tell you why installing ERP software would be good news for your supply chain management tasks and activities.

One of the biggest USPs of ERP solutions – in connection with supply chain management – is that they facilitate better interactivity between companies and vendors. Whether it is about the sourcing of raw materials to dispatch and delivery of consignments, with an ERP software, all the official correspondence becomes centralized as a result of which the quality of communication improves manifold. Moreover, the advantages of ERP also extend to bolstering the quality of strategic planning and execution.

Now, let’s give you an overview of the role of ERP in supply chain management.

Balancing Supply-Demand and Planning

The good thing about ERP is that it is fully automated. This feature helps companies to ensure that the rollout of SCM tasks and activities happens speedily. As soon as an order comes through, demand is created. Soon after, the ERP system automatically does the job scheduling task. In turn, this allows for supervisors and managers to be well-informed about the churn of resources – which are in use and which ones have already been used. Based on this information, the supply chain cycles can be maneuvered to ensure that there is a balance between inventory stockpiles, production, and delivery dates. In other words, ERP guarantees that scales of supply and demand are in equilibrium.

Materials Procurement

With ERP software, you can trust that your procurement tasks will become more organized. Very often companies are daunted by challenges that come with managing procurement cycles. Because SCM operations have many pivots – manufacturing, warehousing, transportation, tracking, dispatch, and delivery – it can be an uphill task (or simply impossible) to have your eyes and ears on everything. That’s when an ERP solution can be very handy. Having an ERP software effectively handles all the processes of the supply chain. What’s more, the software can also streamline the communicational back-and-forth that routinely happens been vendors and suppliers.


Another reason why an ERP system is a must-have in SCM operations is because it handles all the paperwork – from start to finish. Right from creating a bill of materials (BOM) to when and after the production run starts, you can customize the ERP system to automatically record all the shipping documents in an error-free manner. Above all, after the production tasks are complete, the ERP solution can automate the delivery of goods on the stipulated date. Because ERP systems are tailored with a rich selection of automated features, punctuality, and task completion become non-issues. What’s more, ERP features are customizable so managers and supervisors can modify work orders and job schedules to cater to last-minute changes whilst ensuring that production tasks still meet their deadlines.

Shipping Management

The use of ERP software is beneficial for streamlining shipping operations. As soon as goods are shipped, the ERP software will send an auto-generated invoice to the customer. With an ERP system, companies can easily track shipping movements as well as keep tabs on delivery times.

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