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Impact of Business Strategy on ERP

Impact of Business Strategy on ERP

Impact of Business Strategy on ERP

Business Intelligence and ERP Implementation

Enterprise Resource Planning (ERP) is important for organizational success, but companies tend to miss out on one crucial aspect- business strategy. For the effective implementation of information technology, organizations should align their IT goals and objectives with their overall business goals.

ERP is only one component of an organization’s information technology infrastructure. Since the business strategy and ERP strategy of an organization are mutually dependent, it is important that they support each other in the best way.

A business strategy gives a proper direction to an organizations’ actions and decisions. So wouldn’t it be correct to say that successful implementation of an ERP system is dependent on an organization’s business intelligence? Yes, because both are linked by overlapping goals and objectives that a company wants to achieve.

Impact of business intelligence on ERP implementation

Since business intelligence is the connect between ERP implementation and organization’s success, it should be incorporated in the ERP strategy of an organization. Here are ways business intelligence impacts a company’s ERP strategy:

Business intelligence helps deliver ERP system benefits:

Reduced IT maintenance costs, increased efficiencies and time-saving business processes are few of the goals organizations want to achieve by implementing a new ERP system. But it could take years for organizations to pry out inefficiencies completely. Nonetheless, business intelligence, analytics, dashboards, and reporting can deliver a number of ERP benefits to organizations. It can drive better planning and decision-making in both their operations and business environment.

Business intelligence enables process re-engineering:

It is not necessary that business intelligence capabilities to themselves will deliver the desired results. Business process re-engineering becomes a crucial initiative that needs to be aligned with business intelligence capabilities. Before a company does that, it needs to clearly define how analytics, data, and reporting will empower business processes, such as supply chain planning, customer service, and financial planning.

Business intelligence focuses on technology holistically:

Organizations have shifted focus from single ERP systems and adopted a variety of technologies that go beyond the realm of common ERP vendors. Business intelligence enables organizations to look at their technological infrastructure holistically. It helps organizations to identify solutions and integrate them into their business processes, thus empowering their decision-making and operations.

Business intelligence directs data strategy:

Most organizations focus on just migrating old data to the new ERP system. Business intelligence guides and directs the data strategy and data migration efforts of organizations so that new systems support new capabilities. Business intelligence ensures that the new ERP system is fed with relevant and useful data and information so that effective decisions can be made.

Business intelligence drives organizational change:

Business intelligence is gaining significance in the current era of digital transformation and software implementation. It ensures that the new ERP system’s goals are aligned with overall business goals. Business intelligence drives organizational change resulting from the successful implementation of a new ERP system in the company. It clarifies the new focus, defines roles and responsibilities, assists in organizational change management, and brings about a transformation in companies.

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