No software including even an ERP system will solve your problems unless the system is used in proper manner. What is to be remembered is that ERP is a tool and not a magic wand. Therefore the tool must be used properly if you expect any result out of it.
It is also important that tools are only as good for you as you are good and skilled and disciplined at handling them. Poor tools are just that, poor tools – they won’t help you much. But good tools won’t help you any better if you don’t use them properly.
Huge inventory levels may well be result of bad tools to manage inventory properly. Or they may come from people being irresponsible about ordering only what’s necessary. It may come from poor planning tools. Or from people avoiding planning, or not planning at all.
There are many instances when a company’s profitability may be low due to huge administrative overhead or due to shot of personnel to take care of unnecessary costs. Your company can become unprofitable in sales, because somebody is doing favors to certain “big” and “important” customers, and nobody knows or nobody cares. The people who are associated with these malpractices will keep all the transactions under the carpet.
In the above scenario, an ERP system could make a big difference. That means the ERP will not miraculously make those customers profitable for you, but being a tool, it could expose them and pinpoint the reason for low profitability.
It is just an example how an ERP system could be used as an effective tool to curtail malpractices in an organization which will ultimately solve many of your business problems.
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