Why Modern Manufacturers Need an ERP System to Boost Productivity & Efficiency

04 Jan 2021 09:19 AM By Dan Telep

The ERP system has become one of the most important platforms for manufacturer’s business operations. Increasing access to data and business expansion are some of the factors driving this shift to adopting ERP systems. An ERP system’s primary function is to maximize resources and operational efficiency which is essential for any manufacturer to thrive in the current business ecosystem.

Manufacturing is a major segment of Canada’s economy as it contributes $174 billion which is a whopping 10% of the total GDP. The ERP software market revenue in Canada is expected to reach $1,291 million by 2021 indicating that a steady rise in Canadian manufacturer’s investment in ERP software.

In fact, a number of industries have adopted ERP systems in order to optimize business processes and thousands of businesses worldwide count on ERPs for smoother business processes, greater operational efficiency and productivity and a competitive edge. Moreover, companies of all sizes can benefit from an ERP. However, there is often a misconception that ERP software is too expensive an investment – this view overlooks the ROI from an ERP system. This misconception can prove critical leaving companies far behind competitors who have leveraged an ERP system for maximum productivity and efficiency placing them at the forefront of the market.

Impact of ERP on Business Operations & Productivity

1.  Improve Enterprise-Wide Productivity

One of the primary advantages of an ERP system is that it minimizes manual effort and intervention. It improves operational productivity and also eliminates the margin for error and inaccurate data entry by automating data collection. This can save your company significant cost caused due to business mistakes resulting from such errors.

Additionally, ERP systems streamline business functions and eliminate data replication. Information can be easily accessed regardless of the department you are working in via a single source of truth. A well-run ERP system can improve communication between all departments. Smoother, effective communication serves to increase employee productivity and job satisfaction.

ERPs are also designed to keep your business on course by identifying and solving operational issues proactively. This improves efficiency exponentially and improves productivity across the entire enterprise.  An ERP system can accelerate your business cycles with timely invoicing. The sooner you send out invoices, the faster your organization gets paid, thus improving cashflow.

2.  Enable Informed Business Decisions

ERP systems are a unifying platform for all business-related information, keeping data consistent and up-to-date across all departments. Taking advantage of real-time business data allows accurate predictions and realistic estimations. The key benefit from this is the ability to think ahead and plan future business endeavors, strategizing inventory, sales, financials, customer services and your business as a whole. Accurate forecasting can pave the way for making informed business decisions that do not rely on guess work.

3.  Increase Business Agility

Monotonous, repetitive tasks can often take up most of your employee’s productive hours. This in turn impacts productivity causing delays in production and in some cases resulting in poor customer experiences. ERP systems can automate redundant procedures thereby allowing your employees to save time and engage in more value-driven tasks. They can also help provide faster, relevant responses to customers for greater customer satisfaction and retention.

4.  Reduce Operating Costs

Once you have implemented an ERP system, all of your business processes will become streamlined and standardized. The improved data accuracy and automation of processes reduces operational and administrative costs with no compromise on quality. Ensuring accurate data also eliminates expensive mistakes due to inaccurate data. Ultimately, reduced costs allow higher profits.

ERP systems  give your employees on-demand access to all the company’s data to make faster, informed decisions. They will also be equipped with the tools required to make proactive decisions. This improves management of operations as well as productivity and efficiency by eliminating delays for such information that impact decision-making. It also reduces operational costs as many previously manual processes such as  manual information tracking, employee engagement, marketing, production and more have a high degree of automation.

An ERP system can reduce inventory management costs significantly and also enables better control. This is a major expense for every business that has to handle inventory. An ERP makes it much easier to balance your stock against customer requirements, eliminating the problem of having surplus inventory taking up space and costing you money. In addition, ERP grants you better control of your supply chain from ordering to warehousing to inventory control and shipping.

AN ERP systems consolidates business data and this centralization allows you to identify unprofitable aspects of operations and take measures to reduce waste. ERPs also reduce the operational costs for help desk support and marketing. As every department has access to this centralized system, it lowers the costs typically associated with multiple data centers.

5.  Transition to the Cloud

Transitioning to a cloud-based ERP system entails lower implementation costs instead of the high cost traditional on-premise models. Cloud ERPs do not involve additional hardware and infrastructure, so they can be quickly implemented with extant IT infrastructure. Since there are no extra components to be procured company investment is minimized. Switching to a cloud-based ERP system can also reduce operational costs b In addition, your IT department does not have to handle maintenance, as the vendor is responsible for it.

6.  Integrate Mobility and Third-Party Apps

With modern, cloud-enabled ERP systems you have the benefit of accessing, updating and adding new data using any wireless device with an internet connection. Third party ERP integrations can also boost overall system efficiency and productivity.


Clearly there are numerous benefits to implementing an ERP system, but you must pick an ERP system that fits your organization’s requirements. You can also work with an implementation partner – here’s what you need to know about Choosing the Right ERP Implementation Partner.


If you’d like to explore leveraging innovative technology to bolster your business in these challenging times, we would be glad to help. Essential Software Solutions Inc. has Industry 4.0, ERP and Cloud expertise and over 4 decades of experience supporting businesses across Canada in expanding market share and boosting revenue. We can support you with implementing an ERP for your organization. Reach out to our team at ESS to find out more.  

#ERP #Essoft #ERPSoftware #DiscreteManufacturing