Financial planning and the tech tools that empower it

Enterprise processes and procedures are crucial to all companies’ ability to create fiscal policies that ensure the very essence of business success – financial health.

The IT industry is notorious for baffling us with acronyms and blinding uswith science. What makes it even more difficult is the fact that we live in a world where today’s IT innovation will be legacy thinking by tomorrow.
Let’s unpack one such industry term that has been around for a long time – enterprise resource planning (ERP), which is described as the integrated management of main business processes, often in real-time and mediated by software and technology. It has survived for a very good reason – it empowers businesses to perform, control and deliver.
ERP is usually referred to as a category of business managementsoftware – typically a suite of integrated applications – that an organisation can use to collect, store, manage and interpret data from many business activities. It provides a continuously updated view of core businessprocesses using common databases maintained by a management system.
ERPsystems track business resources – cash, raw materials, productioncapacity – and the status of business commitments: orders, purchase orders and payroll. The applications that make up the system share data across numerous divisions within a business, and as such, ERP facilitates informationflow between all functions and manages connections to outside stakeholders.
Gartner defines ERP as the ability to deliver an integrated suite ofbusiness applications, noting that ERP tools share a common process and data model, covering broad and deep operational end-to-end processes, such as those found in finance and manufacturing – in fact in a myriad of business arenas.
I like to define it as common sense.
Developing relevant processes and procedures is crucial to anyorganisation’s ability to create fiscal policies that not only ensurecompliance but also the very essence of business success – financial health. Without it, the ability to achieve business goals, meet taxobligations and ensure sustainability, is negated.
Financial planning encompasses a range of vital strategies for allbusinesses globally and within South Africa. Organisations require thesupport of accurate analyses and reports from financial and operationalmanagement and this can be achieved through the deployment of the righttechnology tools.

ERP and artificial intelligence

ERP systems have evolved around the latest technologies such as artificial intelligence (AI), robotic process automation (RPA) and blockchain, wherebig data is regarded as fintech – financial technology utilised toanalyse and comprehend valuable trends and segmented marketing strategiesthat aim to optimise business operations.
AI algorithms can be utilised as part of an ERP and financial managementstrategy to predict changes, highlight emerging markets and provide valuable insights, such as customer spending habits, which enables businesses to better understand client needs.

I like to define it as common sense.

Manual processes are slowly being replaced by more efficient and effectivetechnologies through the introduction of RPA systems that automate specificrepetitive tasks and are enablers of financial and operational processes, such as accounts payables/receivables stock management and manufacturing. RPAs also yield greater accuracy and increased productivity.

The trick is in choosing the right ERP technology

One of the biggest challenges is adopting the correct ERP technology – many companies fail to achieve this, and as such, technology migration is prolonged indefinitely, killing off the operational gains that could have been achieved and opening the door for competitors that got it right.
Fully integrated ERP business management applications offer a wide range offeatures and functionality – complemented by a number of add-on modules,allowing a solution to be a scalable, flexible and robust. It also providesa holistic view of a business, as both accounting and operational data reside in the same system.
The right ERP system must give your business competitive-edge. It mustincorporate powerful tools and functionality that allow you to track, analyse and manage customer and supplier interactions within the company, allowing you to be proactive in meeting and exceeding their demands.
As most ERP systems are subject to an annual subscription or licencerenewal, the business model from the vendor must also deliver importantbenefits, including updates and upgrades, in or out of country, first and second line support. They must also provide digital support options such as self-service support portals with an extensive knowledge base for frequently asked questions.
The reporting and financial dashboards are critical success factors. Theyprovide detailed monitoring of finance key performance indicators which in turn leads to effective cash management, enabling businesses to track all expenses, sales and profits. Executive dashboards should provide a concise, but accurate view of business performance so executives can getthe information they need with real-time insights into key business performance metrics that support informed decision-making and help to drive the business forward.

Why do some ERP systems fail?

The implementation of an ERP system involves the deployment of software andlicences, the relocation of financial data to the new system, the setup andconfiguring of the system user, mapping out the processes and system training of users on the software.
The truth is that most ERP project deployments do not fail due to poorselection, or the functionality of the ERP software. They fail because ofERP implementation process mistakes made in the early stages of the project, which set the entire project off on the wrong track.
The process of a basic implementation of ERP in any business should bephased and incorporate detailed planning of project execution, the identification of the scope of the work, critical success factors, risks, design and build plus test preparations.
A managed transition process withstabilisation and operations review, post the implementation, will also add to the likelihood of a successful outcome.
Original Source:

Scroll to Top