19 Essential features
ERP features vary across different systems, but they generally include a wide range of financial and operational capabilities that support the common tasks businesses need to function. Here are some common ERP features to keep in mind when selecting the right system for your business.
1. Financial Management
Financial management encompasses all the features that qualify software as an ERP system. This includes standard accounting features such as payables and expenses, receivables and cash management, and revenue recognition. It may also include specialized functions like budgeting, forecasting, and asset and lease management. Together, these features help businesses centrally manage all their financial processes and activities.
2. Accounting
ERP accounting features are similar to standalone accounting software, including tools for general ledger, cash flows, accounts receivable and payable, and expense and invoice management. ERP systems offer the advantage of integrating data from various sources, synthesizing it, and storing it centrally for reporting, analytics, and other financial functions. This integration helps connect finance information to operational processes, improving decision-making.
3. Order Processing
Order processing features in ERP systems manage the lifecycle of purchase orders, from initial order capture to billing, delivery, and payment. These features pull information from multiple systems into one data stream, enabling automation and making order processing more efficient.
4. Project Management
ERP systems often include project management features that help businesses plan, execute, and monitor projects from conception to completion. These features may include detailed project plans, budgeting and cost control, collaboration tools, risk management, and analytics for assessing progress and making data-driven decisions.
5. Embedded AI
Leading ERP systems incorporate AI to automate or speed up specific finance and operations tasks. Examples include AI-powered chatbots for expense report submissions and generative AI capabilities for creating narrative descriptions in financial reports.
6. Real-Time Data
Real-time data in ERP systems enable businesses to spot changing conditions, reassess strategies, and make informed decisions quickly. Real-time data ensures current information is available across the business, improving decision-making and data integrity.
7. Automation
ERP systems automate routine business processes, reducing manual effort and allowing employees to focus on strategic activities. Automation, often powered by AI and machine learning, enhances processes like order fulfillment, inventory management, and financial operations, increasing efficiency and productivity.
8. Data Analytics
ERP systems include reporting and analytics capabilities to collect and analyze operational data. Features like report generation, query tools, and dashboards help make data more digestible, supporting decision-making. Advanced analytics may require add-on software.
9. Business Process Controls
ERP systems feature business process controls to optimize and automate tasks, improving efficiency, data accuracy, risk management, and compliance. These controls include workflow management, predefined approval processes, and role-based user access controls.
10. Reporting
ERP systems provide reporting capabilities for financial, operational, external, and compliance purposes. Financial reporting is the most common, offering an overview of business performance. Reporting features enhance transparency and efficiency, driving better decision-making.
11. Integrations
Integrations connect ERP systems with other software applications and data sources, facilitating end-to-end business processes across departments. Integrations enhance insights, decision-making, collaboration, and data consistency without manual data transfers.
12. Single Database
Single database ERP systems centralize business data, using one common data model for all systems and processes. This simplifies data access and IT infrastructure management, reducing complexity, human error, and information loss.
13. Manufacturing
ERP systems, rooted in manufacturing, include features for production, planning, and resource management. These capabilities help businesses match production with supply and demand, manage costs, and optimize inventory levels.
14. CRM
Customer Relationship Management (CRM) features store customer data, track interactions and sales leads, and manage marketing campaigns. While not standard in ERP systems, integrating CRM functionalities can enhance lead identification, upselling, and customer data management.
15. Sales Management
Sales management features help businesses manage customer relationships, optimize sales workflows, and improve performance. These may include revenue operations, sales forecasting, quoting, sales analytics, and territory management, ultimately driving revenue growth.
16. Marketing
Some ERP systems offer basic marketing tools like email tracking, campaign metrics, and customer segmentation. For advanced marketing needs, specialized software can be integrated with the ERP system.
17. HR Management
Human Resource Management (HRM) features in ERP systems include tools for employee information management, benefits administration, payroll, workforce planning, recruitment, and training. Integrating HRM with ERP drives efficiency and connects HR planning with financial budgeting.
18. Supply Chain and Purchasing
Supply chain and purchasing features optimize procurement, demand planning, and inventory management. Integrated supply chain features enable strategic decision-making with real-time information.
19. Business Intelligence
Business Intelligence (BI) tools in ERP systems support data analysis, visualization, reporting, and strategic planning. BI tools extract insights from data, helping businesses make informed decisions based on reliable and up-to-date information.
