3 Areas Where E-Commerce Companies Fail To Get The Most From Their ERP Distribution Software

Getting the most out of your ERP distribution software is all about identifying critical business processes and ensuring the technology supports them.

The critical processes are where you get the biggest bang for your buck, because that’s where the most efficiency can be gained from an ERP system. Far too often, e-commerce distributors underutilize their ERP system, causing them to miss out on the benefits it offers.

The first step to getting more out of ERP is to review the workflow of your critical processes. The next step is to analyze how the technology systems are supporting (or not supporting) those processes. This allows you to see where some of the gaps are in the technology, and then you can prioritize improvements and start work on the most important component.

Here are three common areas where e-commerce companies often fail to get the most from their ERP system.

1. Managing metrics: Many companies fail to manage the appropriate metrics. Distributors should be monitoring profitability, inventory turnover and order-to-fulfillment ratios, to name a few areas. Managing metrics helps the business to perform better.

   There should also be historical data in the system so businesses can make more informed decisions about demand planning. As the saying goes, you can’t manage what you can’t measure. You must be sure to build the necessary information into the system and that any data you’re inputting is accurate.

2. Automating business process workflow: When ERP systems are implemented they’re often implemented at the base functionality and left at that. There could be many reasons why businesses stop at the base level, including financial and logistical considerations. Often, people just want to get the systems up and running, and don’t want to deal with the additional time and cost of optimization.

   But it’s a mistake to stop at the base functionality. If you never fully optimize the systems, you won’t be able to realize the efficiencies possible with automated business process workflows. There may be inefficiencies in the order fulfillment process or the vendor approval process, for instance. These are often manual processes when ERP is initially implemented that could be automated. Manual processes are time-consuming and error-prone. Automation streamlines the flow, allowing for greater efficiency. E-commerce businesses would benefit tremendously from automating all the processes that they can.

3. Lack of integration between critical business systems: This is a major area where ERP distribution software is underutilized. If processes are treated as an island, their whole value isn’t being realized. For example, an operational system, such as logistics for managing shipping, should be integrated with ERP.

   The single most important ERP project that e-commerce distributors should consider implementing is the integration of the front-end order system with the ERP system. Not having that integration creates inefficiencies and challenges during order entry. Integration will improve the customer experience, and the business will enjoy better order fulfillment process. Technology helps to bridge gaps such as those.

E-commerce distributors stand to gain a lot from ERP distribution software, and they should make an effort to review all processes to determine whether they’re getting the most out of the technology.