Finance Technology

What does Automation and Digitization mean in ERP systems?


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If you know what an ERP is, you should also understand some of its most significant potential benefits. Simply put, the job of an ERP is to make your life easier. An ERP can integrate processes, provide key analytics, and ensure that your business operates efficiently. This information can enhance your operations and redeploy your limited human capital to more efficient and essential needs. Indeed, automation and digitization are two of the most significant benefits of any ERP.

However, what are these functions? How can they help your business thrive? And what do you need within the scope of these two critical factors?

 

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What Are Automation and Digitization Within an ERP context?

Automation is at the core of every ERPs function. Indeed, from a historical perspective, the need for increased automation was one of the primary reasons ERPs first became popularized.

You can automate an ERP for various tasks depending on its programming. These tasks can include automated messages or notifications for when supplies arrive (or when reorders are needed), immediate and automated sharing of information, and updating key performance indicators. Recent advances in the world of Artificial Intelligence have fundamentally altered the way that ERPs operate. Artificial Intelligence can now provide critical insight that humans may have missed. This insight can include supply chain disruptions, signs of a hospital patient experiencing difficulty, or a student's performance warning signs.

Generally speaking, digitization refers to the process of relying increasingly on data in an electronic form. Digitization allows for data to be analyzed and monitored by computers and complex algorithms, thus leading to critical insights. In many cases, information that ERPs manage already was available electronically. However, ERPs are perhaps the most effective for ensuring that all can use data. The phrase "single source of truth" has been applied to ERPs innumerable times, cutting to the crux of an ERP that can use your data.

With an increase in the digitization of data, more and more people have access to the information that an ERP may be able to display. This access allows for any authorized individual to see and use data. As such, all companies have access to the same source of information and can use it in a manner that best suits their needs.

 

What You Need in Terms of Automation?

As we have discussed previously, automation holds almost limitless potential in the EPR space. You can automate many functions, including workloads, planning, expense tracking, and much more.

However, automation is only valid if it fulfills your specific, customized needs. As such, there are multiple functions that your ERP should have in terms of automation.

First and foremost: That automation must be customizable. An off-the-shelf product may suit some of your business needs, but not all of them. For example, a product may be able to synchronize data across multiple devices automatically, but is that data instantly available from mobile devices? What kind of automated data exchange is an ERPs server able to support? Automation must be real-time for it to be any good.

Furthermore, you must be able to customize the types of notifications that you get. For example, do you need a human to get an automated text message or Email if their account is more than 30 days late? Does your accounting office need the same automation? Who else in a business should be notified? Should your sales team? What automation do your ERP service providers use if this is the case?

Can your ERP automate specific tasks? For example, can it automatically place orders when you run low on certain supplies? Can it let you know when employee productivity falls below a certain level? Can it let other department managers know as well?

Remember, the goal of an ERP is to break through traditional silos and ensure that all authorized individuals within a business understand what is happening across the entire industry. As such, task automation is a minimum requirement for an ERP.

Finally, depending on your line of work, you may need an ERP to involve specific business processes directly. For example, let's discuss utilities. Some ERPs can automatically be scaled up or down, deploying or redeploying specific resources and power supplies. This automation allows your business to provide services with reduced costs. This automation has to be customized, as different utilities may have different needs. Furthermore, all information within an automated ERP can synchronize with your finances, general ledgers, accounts payable, and accounts receivable. This automation ensures that your finances are automatically updated to adjust your deploying power resources.

 

Ensuring That You Get the Most from Digitization?

As noted above, digitization ensures that data is made available electronically and that the appropriate individuals and departments access needed data and metrics. By doing digitization correctly, an ERP can maximize the efficiency of a business and ensure that all individuals have the tools and information they need at their fingertips.

If you are just starting to move into an ERP, it is essential to realize that you don't have to jump in all at once. Learn the 10 Signs It’s Time to Change Your ERP Provider.  Doing so may be disruptive to your organization. Instead, you can manage ERP implementation in phases by working with ERP experts and individuals across your business. For example, you can start using an ERP for general ledger and accounts payable. This slow movement can allow your business to get comfortable with an ERP and ensure that you can make any internal changes necessary to manage the switch to digitization best.

Once you begin to adopt an ERP fully, you can start to maximize the data. Every business has different needs and may get additional value from deploying an ERP. By working with an experienced ERP provider, you can ensure that you can deploy the data your ERP generates appropriately. For example, let's say you have a healthcare organization. Still, you are having trouble getting paid adequately by insurance agencies. The data generated by an ERP can help you determine if there are specific codes that are slower to be reimbursed than others. Accordingly, finding particular reasons your money isn't being transferred as fast as you need it to be may be possible. By learning this information, you may be able to identify human error, find specific procedures that are slow for reimbursement, or determine which insurance companies are slower to pay you than others. Whatever the reason, an ERP can see it. As a result, you can work with an ERP to adjust your business practices appropriately and get paid faster.

Digitization, of course, is not without its potential challenges. For example, each sector has its own specific rules and regulations that your ERP must appropriately address. For example, consider HIPAA compliance within the healthcare sector. HIPAA is the governing body of laws and regulations protecting patient privacy and ensuring that only appropriate parties can access a patient's confidential medical information. Failure to adhere to HIPAA regulations can result in significant fines and penalties for the violating organization. Therefore, you must ensure that your ERP has adequate and robust HIPAA protections. Again, working with an ERP organization with experience in the healthcare sector can do this.

 

Maximize Automation, Digitization, and Efficiency with Multiview Software

Digitization and automation in ERP systems are not small changes. Instead, they are massive, disruptive trends, and they have the potential to change the way that your business operates dramatically. However, to take full advantage of digitization and automation, you must work with an ERP provider with ample experience in both fields.

At Multiview Financial Corporation, we have systems that can fit your needs and ensure you get the most out of automation, digitization, and much more. Want more information? Connect with us today to request a demo, and let Multiview Financial Corporation help meet your future technological needs.

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