ERP Integration: Definition, Benefits, Types & Challenges

Tally Solutions |Updated on: September 16, 2021

What is ERP integration?
Importance and benefits of ERP integration
Types of ERP integration
What are the challenges of ERP integration?

What is ERP integration?

Integration of ERP is nothing but connecting your enterprise resource planning software with your existing system or applications. The role of this integration is to primarily disseminate information across functions in the most logical and a transparent way for better efficiency, planning and forecasting.

Want to find out how ERP could benefit your business? Read: https://tallysolutions.com/erp-software/what-is-enterprise-resource-planning-system/

Importance & benefits of ERP integration

ERP integration has several benefits, one of which is to become a single source of information for all departments in an organisation. From real-time reporting to enhanced productivity to reduced operational cost, the advantages are numerous. Let us look at some of the most crucial benefits and importance which ERP integration can offer you:

Improved order and inventory management

Accurate tracking of inventory is crucial in any business. Isn’t it? If you had to rely only on guesswork to identify stock levels or demand, your business will never be able to achieve the desired goal. Thus, integrating an ERP system will make the flow of information across departments more seamless. The automated ERP system allows you to eliminate manual data entry and ensures smooth communication between the concerned departments.

Enhanced workflow

An integrated ERP system will help you streamline your business processes in a more systematic way. From prioritisation of tasks to centralising information across the company, a well-integrated ERP system will make your improve transparency among departments resulting in better interdepartmental communication. You will also be able to know what teams are working on, which will not only help to understand whether the on-going activities are aligned with business objectives, but also make modifications in tasks wherever and whenever necessary.

Collaborative work

Since the information flow is so seamless, departments can work collaboratively towards the company’s objective. Decisions regarding the sales, investment, cost optimisation, inventory planning, etc can be taken much faster, which will eventually result in better productivity and increased revenue. You will be able to develop a clear understanding between demand and supply, helping you get a clear picture of your customer and stock levels, resulting in improved customer satisfaction.

Types of ERP integration

ERP as a system or single solution made from scratch

This option is preferable in case you don’t use any ERP applications and plan to apply for the services of a software development company. Business analysts will conduct a series of interviews to define the issues of your business and develop a proper software solution to solve them.

ERP as integrated modules for the existing system

This option allows improving the used business processes without spending resources on development and deployment of a new software solution. Instead of that, you can add new modules to the application that is already in use and carry out concomitant customization if needed.

Want to find out the best ERP integration solution for your business? Read: https://tallysolutions.com/erp-software/advantages-of-custom-erp-solutions/

Web-based ERP

Web-based ERP software is also referred to as cloud ERP and more technically referred to as 'Software as Service (SaaS)'. Web-based ERP software allows the user to access the ERP applications using the internet. Web-based ERP computing resources are maintained in the dedicated remote data centres making it possible to access them anytime and anywhere.

Get deeper understanding of how different types of ERP software system are designed and their business benefits: https://tallysolutions.com/erp-software/types-of-erp-software-system/

What are the challenges of ERP integration?

An ERP system’s primary purpose is to automate business processes to make the business more efficient and provide better visibility into those processes. However, there could be some challenges that businesses might face while integrating their current systems with an ERP. While the system aims at making the business process more streamlined, incorrect implementation could have some negative impact in the business.

Multiple ERPs to manage different processes

While choosing an ERP software, a business owner must ensure that he carefully assesses what his requirements are v/s what the software offers. Several times, business owners tend to choose a solution to meet their short-term demands, and then as their company expands, the current system fails to grow with it, resulting in poor results. Thus, it is imperative to choose an ERP system that is your growth partner and gives you insights that will be beneficial for your business in the long run.

Difficulty in syncing invoicing, accounting and inventory

An accounting transaction can impact your invoicing, inventory, banking, etc. When you maintain your accounts manually, you need to put it extra efforts to ensure that your invoices match your books and that your inventory is in sync with the transactions entered. A great advantage of using accounting software is that all you need to do is to enter your transactions. All your accounting reports, inventory numbers and credit management are then taken care of by the software.

Large volumes of data can result in mismanagement

Erroneous data is never a good thing. It is obvious that when a company grows, the processes become more complex, and eventually the data also starts pouring in large volumes. This could result in inaccuracies which would obviously impact the growth of your business. Choosing an intuitive ERP software that not only seamlessly integrates with your current system, but also lets you manage your business your way in the present and in the future, will show you incremental and desired results in the long run.

Integrated business management software allows you to start with what you need and add features/solutions as your business grows. TallyPrime, the powerful business management software is designed keeping the business needs of the growing business. With a wide range of features, TallyPrime can be your perfect business companion.

Here is the list of modules or features of TallyPrime