Nowadays, companies as well as consumers are placing more importance on the customer experience when selecting brands to buy from. Enterprise Resource Planning (ERP) systems are essential for supplying the information required to provide those customer experiences, along with the experiences within the supply chain. However, businesses need a modern ERP integration platform approach to overcome the many challenges along the way. ERP integration can enable you to create exceptional customer experiences on every side of your business.
Table of Contents
What is an ERP integration?
Enterprise Resource Planning (ERP) is a type of company management software that makes it easier for firms to collect, track, manage, and work with their data on things like customers, goods, finances, logistics, supply chains, and other essential business processes. An ERP usually maintains integration between the data that is typically handled by several departments, making it easier to manage company data.
It takes some time to learn how to use an ERP effectively. The objectives and structures of a business must be interwoven with it. To assist enterprise-level planning and operations, it gathers data from financial to logistical and human resources.
After learning what an ERP is and how to select a good ERP integration software, you should investigate what ERP Integration is. ERP integration is the straightforward connection and synchronization of your ERP software with other business applications such as eCommerce (front-end), CRM (Customer Relationship Management), EDI (Electronic Data Interchange), marketing tools like analytics, and other databases and data points that your business uses. Connecting all the points a business uses to enter, manage, track, and produce relevant and significant data.
Why is ERP Integration important?
Although it’s important that ERP as a whole integrates a variety of organizational data points, it also needs to interact with other business systems in order to increase operational accuracy generally. Let’s start by taking a look at what might go wrong for your organization if you don’t have integration with ERP in place.
1. Flow of Manual Data
Consider a lead form that is submitted via your e-commerce website. If your ERP and eCommerce are not integrated, the information is kept in your eCommerce until a manual entry is made into the ERP. This makes the workers more taxed and reduces the efficiency of operations. ERP systems integration is essential to getting rid of this labor-intensive, time-consuming job.
2. Erroneous operations
The above-mentioned issue with manual data entry leads to the development of this pain point. Humans are prone to error and make mistakes frequently. As a result, incorrect or missing customer and product data are entered into ERP systems, which causes departments to operate with inaccurate information and a slew of additional issues that ultimately result in dropouts and dissatisfied customers. And none of these are less likely to occur if ERP is not integrated with other systems.
3. The absence of real-time data
As can be seen from the previous two paragraphs, defunct systems require manual data changes. This suggests that the data is not shared with the ERP very away as it is needed. In the end, the important parties in your firm simply attend to their own operations, wasting time-consuming days by physically transmitting data. And once the activities are complete, it takes even longer days to give the consumer the final service. Again, in the end, this causes drop-offs and a loss of income.
4. Low conversion rates in the sales funnel
The sales funnel is the entire process of a person visiting a website, doing business and eventually repeat business. This encompasses a number of stages, including lead, prospect, customer, repeat customer, and business evangelist. An effective sales funnel has higher conversion rates and shorter conversion durations from one stage to the next. This is an unlikely scenario in the absence of an integration ERP system, resulting in a poor sales funnel and a loss of leads that may become clients.
5. Team Collaboration Was Compromised
Data consistency between systems is critical for different teams to work toward the same goal with the same vigor and without disagreement. This indicates that without ERP System Integration, team cooperation will be limited, like in the following inventory management scenario:
- The product is no longer available in the eCommerce store.
- The sales team requests that the inventory team ensure that the product stock is kept up to date.
- The inventory team locates stock availability in the ERP product area and contacts the sales team to recheck the product in eCommerce.
- A sequence of encounters occur between the sales and inventory teams, resulting in disagreements and unhappiness on both sides.
- In terms of business revenue, the end consequence is counterproductive.
Advantages of ERP integration
1. Data centralization
ERP integrations enable the centralization of organizational data and the improvement of communication within the organization. They contribute to the creation of a central hub where all departments may access real-time data and benefit from flexible, agile solutions in an ever-changing environment.
Without an ERP system, each department maintains its own records and databases. Teams can upload data, generate reports, and share them with other groups. However, if there is duplicate data, they must validate data integrity, which adds more work and difficulties for everyone. Legacy systems frequently use “gatekeepers” to share information, but they can soon become overburdened with demands for information.
2. Operational Precision
Teams using the appropriate data boost the correctness of data in ERP software. Without ERP connection, for example, the operations staff would have to manually enter customer orders from eCommerce, which is error-prone and could ultimately result in the delivery of the wrong products and/or salespeople engaging leads with the wrong needs.
3. Improved Workflow
Data pertaining to the workplace can be centrally located by integrating your ERP with your main business tools, such as project management. As a result, everyone at the organization will be able to see what the others are working on, and you may assign jobs to employees according to their priority and organize your schedule accordingly. Additionally, being aware of what teams are working on will help you determine whether ongoing activities are in line with business objectives and make changes to tasks as needed. For instance, if you requested a project report from an employee but discovered they were working on a project’s priority development assignment instead, you may reschedule the task you gave them in accordance.
4. Truth from a single source
Data from other applications, including eCommerce and CRM, are updated in the ERP software thanks to the integrated ERP system with other applications. Access to omnichannel business data would be available to all departments. For instance, the inventory management team would have access to the real-time inventory of products accessible in eCommerce and could take rapid action if there was a supply shortage. The accounts team wouldn’t have to wait for the marketing and sales teams to provide information on revenue. Additionally, keeping all data in the ERP ensures that it stays the only source of truth for data, and employees consult the data in the ERP in the event of any discrepancies.
5. Utilization Efficiency
By automating the manual data entry into the ERP, you are removing one of the most time-consuming tasks from the work. This relieves you of unnecessary burdensome work and enables you to use that time to perform other beneficial company operations, such as market penetration, the deployment of new features, business expansion, process optimization, and so on. Since integration with ERP systems makes accurate real-time data available in the system, you can quickly use the data to extract high-level actionable insights and make decisions that support growing your organization.
6. Improved client experiences
Integrated ERP solutions can assist companies in developing a thorough understanding of client preferences and interests. The customer experience can then be enhanced by using this information to design genuinely tailored interactions across physical and digital settings.
A brand’s future success will be based on how businesses employ ERP integrations for consumer interaction. Those who use ERP systems for smart customer engagement will be successful.
7. Rapidly increasing sales conversions
Accelerated sales conversions mean that, in comparison to before you integrated your ERP program, more website visitors are turning into leads and more leads into customers in shorter amounts of time. Lead data is promptly sent between CRM and eCommerce, allowing various departments to collaborate on meeting unique client expectations and wants. A twofold benefit of higher customer satisfaction and business revenue is provided as more and more leads are processed efficiently in less time.
Challenges of ERP integration
While it is clear that ERP Integration addresses the aforementioned business pain issues, it does not appear to be a simple process. The process of integrating your ERP with other business systems has just a few significant drawbacks. These difficulties, which can be categorized as pre- and post-integration difficulties, must be taken into consideration before proceeding.
1. Unsecured connections
The most important corporate data, such as private client information and secret intelligence, is stored in your ERP system. At all costs, they need to be preserved. When you integrate ERP software into your system, you increase system complexity and the likelihood of unsecured connections, which raises the threat level to your company when cybercriminals target ERP software.
All of the personnel you deploy for ERP Integration must be experts in the field and appropriately onboarded for the integration process due to the complexity of both your company needs and the ERP System. Although you can use internal staff to integrate your ERP with systems, it is advised to outsource your integration needs to partners who specialize in ERP Integration, with an integration platform that can meet all of your specialized integration requirements and address all of your integration issues.
3 Over budget
Most ERP implementations end up costing three to four times as much as anticipated. The main causes of overspending 65% of the time are system modifications to increase usability.
4. Data Standardization Across Applications
Various programs offer various data types and formats. What may be pertinent in a certain application (like CRM) may not be pertinent in the ERP. Some data, such as a distinct customer ID that comes from the CRM, may not always be accepted by your ERP. You must ensure that all of these various data formats are uniform across all applications. In addition, you must confirm that the APIs of the ERP and other systems permit the flow of data from/to one another before integrating the systems. Once this issue is resolved, standardizing data will perform wonders and significantly lessen the strain associated with ERP Integration.
Enterprise Software Development
5 common types of ERP integrations
The type of ERP integration you choose depends on your IT resources and specific business needs.
Ecommerce integration entails linking your e-commerce platform—such as Shopify—with an online ERP program. They improve customer shopping experiences by enhancing the operation of your e-commerce store as a whole.
Through an e-commerce ERP integration, data such as leads, customers, orders, shipping dates, taxes, and customer assistance are all tracked. The integration’s goal is to make data accessible to everyone in the company who oversees the online store.
- Front-end data that is precise and pertinent is accessible across all departments
- Actual inventory counts both at the front end and the back end
- Customer-specific, flexible price choices
- Electronic financial audits
Customer relationship management (CRM)
Superior customer service and satisfaction are the hallmarks of any successful firm. Everything about customers, including their transactions, orders, communications, and much more, is stored in CRM. When other departments, such order management, logistics, and inventory teams, perform poorly, they are frequently criticized rather than other departments, such as salespeople, for poor sales funnel performance. This is brought on by a lack of communication between your CRM program and ERP software. Because of this, ERP and CRM integration is essential, especially for fostering a relationship between supply and demand (CRM) (ERP).
- Teams can work together to achieve a customer requirement.
- Sales funnel conversions and performance have been improved.
- Customer pleasure results from prompt and effective customer service.
- Because of linked ERP CRM systems, customers’ information is consistent across systems and departments.
BI software is used to retrieve, analyze, and report data. Because it provides visibility into a company’s data, BI software is critical for firms experiencing a digital transition. It quickly aggregates and visualizes data, allowing stakeholders to uncover fresh insights and act on them to improve their bottom line.
In some circumstances, your ERP system may have a BI feature. However, the functionality is frequently insufficient for enterprises that deal with massive amounts of data on a daily basis. When a corporation integrates a third-party BI system with an integrated ERP, these insights become readily available to any authorized employee. They also gain access to enhanced reporting, which assists businesses in making the most of every piece of data they receive.
Human resources has the most back-end tasks of any department. Managing HR data, which includes payroll, recruitment, assessments, and job offers, may quickly become burdensome. Mishandling sensitive HR data is both costly and dangerous to any business’s security.
An HR module in your ERP aids in the management, digitization, and automation of HR department procedures. Among the advantages are:
- Basic personnel databases must be securely stored and managed.
- Payroll and compensation handling has been simplified.
- Time and attendance management has been improved.
- Employee development and training must be improved
- Companies can also be inventive with their ERP HR module. They may send employee satisfaction surveys in the workplace, set up automated reporting, and simply execute and comprehend performance assessments across the firm.
Some ERP systems, like BI software, may integrate project management tools. Nonetheless, many businesses that begin developing ERP systems already utilize more complicated project management tools. Viewing the status of projects in your ERP is beneficial for several reasons:
- You can calculate project costs.
- You may see project updates and processes.
- You can determine whether or not project techniques are effective.
- You can work with the HR and payroll divisions.
When you implement a project management module in your ERP, anybody can see who is working on what and when it will be completed. Understanding these routines fosters ownership across divisions and can assist businesses in resolving minor project challenges before they become major concerns.
How to Integrate ERP with your existing Business Applications?
Integrating your ERP System with your mission-critical apps is trivial. The following are the procedures to configure your ERP Integration with systems utilizing a basic iPaaS Integrator:
- Add System Credentials: To begin, configure the credentials (API token) for your ERP and any other systems you desire to integrate.
- Create Flows: Set up the foundation for the interface between your ERP and other apps, including when and how data should be sent and CRUD (Create, Read, Update, Delete) actions.
- Configure Integration Pipes: Pipes are just data points in your system, such as Customer Data, Product Data, Order Data, and so on. All you have to do is configure equivalent pipe connections (for example, Inventory Data) in the connected systems (ERP and eCommerce).
- Set up Mapping and Modifiers: Next, connect the data fields of the ERP, eCommerce, and CRM systems. (For example, the ERP “Customer Name” column is split and mapped to the CRM “First Name” and “Last Name” fields.) Set up complex business logic to control how data fields interact with one another. (For example, in ERP, divide “Customer Name” into CRM data fields “First Name” and “Last Name”).
- Enable Auto Mode: After automating and configuring the sync schedule and frequency, make the link between the ERP system and other apps live (real-time synchronization, if needed).
- Your Integrator application is now in command.
As such, ERP software changes and adapts to business demands regularly, just like the majority of companies that work in the technology field. Because of this, ERP integration is so common in businesses today. The options for personalization are alluring and frequently fruitful. Before choosing a system integration in ERP strategy or an ERP vendor, you should think about the kinds of tools you want to include in your solution and the integration type that would be most beneficial for your business.