ERP systems serve as a pillar in every business that aspires to gather, share and analyze information from different departments, including accounting, sales and marketing, operations and more. While ERP software lets users access company-wide data from a centralized location, BI tools thoroughly analyze this information to derive insights and make data-driven decisions. ERP-BI integration boosts an organizations’ agility and paves the way for success in the long run.

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What this article covers:

• What is ERP?
  • Primary Benefits
  • Key Features
• What is BI?
  • Primary Benefits
  • Key Features
• ERP vs BI
• Key Differences
• ERP-BI Integration
  • Benefits of ERP-BI Integration

What is ERP?

ERP solutions serve as a central hub for information, and organizations leverage them to automate and streamline business processes. Centralized data repositories house data from different departments, including manufacturing, finance, operations, human resources, sales and marketing and more.

It helps stakeholders gain useful cross-departmental insights, analyze business scenarios, conduct financial planning and generate process amendments. These benefits result in efficient processes, cost savings and productivity as people spend less time searching for the required information.

An ERP solution empowers users to view project statuses and gauge the performance of different business functions while providing robust workflow visibility. It also helps users uncover trends, patterns and insights with reporting and analytics capabilities to make data-driven decisions.

Primary Benefits

• Enhanced Reporting: ERP systems serve as better reporting tools with access to real-time information as an integrated database.
• Improved Customer Service: ERP systems provide seamless access to customer data, resulting in quick response times, improved on-time delivery and better order accuracy.
• Security: Cloud solutions offer enhanced security measures such as two-step or multi-factor authentication, data encryption capabilities, user authentication and more to protect information against malicious access.
• Business Process Enhancements: Automate manual or routine tasks and configure smart workflows to boost operational efficiency.
• Supply Chain: Forecast demands accurately, reduce production bottlenecks and achieve transparency throughout the supply chain.

 

Key Features

Financial Management

The financial management module involves planning and organizing funds. Track, store and analyze financial data, including accounts receivable (AR), accounts payable (AP), general ledger and forecasting. It also performs advanced tasks such as fixed assets management, tax management, revenue recognition and multi-currency reconciliation.

Human Resources Management

A human resource management module serves as an end-to-end employee management platform that includes payroll, hiring, onboarding, time tracking, compensation management and more. Complex HR functions include tax management, performance management and more.

Customer Relationship Management (CRM)

CRM modules manage and track customer information, including contacts, order history, purchase orders and more. It records issues and tickets, identifies sales opportunities and manages marketing campaigns in a centralized location. A CRM module aims to boost customer relationships, facilitate communication, streamline processes and improve business profitability.

Supply Chain Management

Track inventory, logistics and distribution with a supply chain management module. It supports cross-dock planning, demand forecasting and billing and freight matrices to bring transparency to the supply chain.

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What is BI?

Business intelligence leverages tools to transform data into actionable insights that govern business decisions. BI tools access and analyze data and present findings in the form of reports, dashboards, charts, graphs and maps to give users detailed intelligence about the business state.

For example, BI tools can generate sales reports and track useful metrics with data obtained from sales departments. A sales team can also leverage BI tools to create a dashboard displaying each representatives’ prospects on the sales pipeline.

Primary Benefits

Let’s learn about the benefits of a business intelligence tools:

Boost Customer Satisfaction

In a B2C marketplace, BI tools help companies understand customer behaviors, preferences and buying patterns. Most organizations allow customers to fill out surveys and collect feedback in real time about the product and services they offer. Businesses incorporate feedback into their offerings to boost customer satisfaction. They identify and analyze buying patterns that help anticipate needs and deliver better service.

Improved Data Quality

Data obtained from various sources is rarely clean. It has discrepancies and inaccuracies that require consideration. BI tools collect data from incoherent sources, merge it and create quality data for analysis. They help businesses gain an accurate picture of day-to-day business operations.

Identify Market Trends

BI solutions let businesses identify new market trends and opportunities to build a competitive business strategy. Successful business strategies have a direct impact on long-term profitability and sustainability. Users can leverage external market data to detect upcoming opportunities and possibilities to use them for business advantage.

Increased Operational Efficiency

These tools consolidate information from multiple data sources. They provide real-time data access for users to create real-time reports and dashboards while mitigating the time spent tracking down information. Armed with recent information, users can focus on short and long-term objectives and gauge the effectiveness of their decisions.

Increased Revenue

Increasing revenue is a primary objective for any business. The insights obtained from BI tools empower them to ask the right questions through data querying capabilities. Users can make robust comparisons across various dimensions, gauge prior decisions’ strengths and weaknesses and make accurate predictions with predictive analytics. Revenue is most likely to increase when businesses incorporate customer feedback into their products and services, thoroughly analyze their competitors and refine their operations.

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Key Features

Data Visualization

Converting tedious numbers and calculations into visuals like charts, maps and graphs can make it easier for users to comprehend and derive useful insights. The primary objective of creating robust data visualizations is to identify trends, patterns and outliers within datasets. Some different types of visualizations include treemaps, bar graphs, pie charts, line and area charts, scatter plots and more.

In a modern workplace, it is imperative to convey crucial information effectively at different levels of business. Data visualization comes in handy here and allows you to present huge volumes of information in a simple way.

What-If Analysis

What-if analysis compares different business scenarios to predict potential outcomes based on fluctuating conditions. It allows users to determine the impact or outcome of changing conditions and assumptions. Users can make robust decisions and predict the outcome of those decisions precisely.

BI tools provide an objective view of the risks and rewards associated with potential decisions and allow you to plan better.

Self-Service Analytics

By leveraging self-service analytics, business users can analyze data without IT support. Users can perform tasks like data cleaning and exploration, verification, visualization and reporting without vast technical knowledge. They can ask and answer questions with data querying capabilities while performing functions like drill-downs, grouping, filtering and creating pivot tables. They can also compare performance over time, geographies, product groups and customer sectors.

Interactive Reports

Interactive reports let users conduct in-depth analysis and dig deeper into the underlying data to support better decision-making. They facilitate robust drill-down capabilities and slice and dice data to unearth useful trends, patterns and insights. They use conditional formatting to set data alerts that highlight exceptions and apply advanced techniques like moving averages and regression to spot trends. They also use time series analysis to identify anomalies within large datasets.

Location Intelligence

Location intelligence is the ability to map and visualize data in geographical formats. Exploring and visualizing datasets based on spatial elements empowers organizations to gauge business operations and performance from a different perspective. For instance, sales per region, identifying which regions are performing better than others and which ones need attention is easier.

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ERP vs. BI

An ERP system serves as a process management solution that manages and integrates various business processes, including manufacturing and distribution, supply chain, inventory management, accounting, human resources and more. As a centralized data repository, ERP promotes efficiency across different processes.

On the other hand, BI solutions leverage the data stored in the ERP systems to unearth trends and patterns and generate actionable insights. They help users create robust reports and dashboards to gauge complex data and make better decisions.

ERP provides an operational view of business processes, allowing users to get a comprehensive view of each of the functional areas. BI analyzes data, helping organizations dive deeper into key performance metrics, make amendments to processes and optimize strategies if needed.

Users leverage BI tools to analyze the ROI of new email marketing campaigns or calculate cost savings by implementing a new inventory management strategy. With BI solutions, you can measure business performance in quantifiable ways that aren’t possible with ERP solutions.

Key Differences

Strategic-Level vs. Operational-Level Analytics

Analysts leverage BI tools to obtain a high-level overview of the organization’s performance and make strategic business decisions. They let users conduct an in-depth analysis of data obtained from different sources to deliver knowledge and insights. These features provide a bird’s-eye view to gain a better understanding of business processes and operations.

On the other hand, ERP is an operational system capable of storing transactional and operational data. It provides an accurate business view from an operational perspective. However, it doesn’t give an overall perspective of business performance.

OLAP vs. OLTP

BI is built as an Online Analytical Processing (OLAP) system to provide robust analytical capabilities like dashboard management, scorecards, advanced visualization and reporting capabilities. It performs automated data cleaning and allows users to view data from different sources and formats on a single screen.

ERP is an Online Transaction Processing (OLTP) system that records transactions as and when they occur. ERP architecture optimally records transactions with minimum space utilization.

Agility vs. Efficiency

Organizations are gradually moving from historical reporting to forecasting and forward planning. BI can help future-oriented organizations become more agile with the help of predictive analytics capabilities, letting them make strategic decisions while taking advantage of future market conditions.

However, ERP solutions can deliver business process efficiencies in various forms, including better inter-departmental communication, IT cost reduction and real-time data access. Proper ERP implementation is likely to enhance businesses’ overall performance.

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ERP-BI Integration

Nowadays, businesses generate vast amounts of structured and unstructured data, and they need a way to organize, store and analyze this information at scale. ERP-BI integration lets users consolidate information into straightforward, actionable insights that deliver a competitive business advantage.

Organizations lean toward predictive modeling to anticipate outcomes that drive the popularity of ERP-BI integration. The ability to spot trends and patterns within data, anticipate market dynamics and amend processes are primary business pain points.

Benefits

Data Aggregation and Analysis

ERP systems generate enormous amounts of data from various departments within the organization. With BI integrated into their ERP, businesses can conduct advanced analysis to derive useful insights from data.

Customization

Even though each team within the organization works toward common objectives, individual team members or stakeholders utilize data for different purposes and have specific analysis requirements. An integrated ERP-BI system helps team members generate reports and dashboards to meet specific departmental needs.

Predictive Analysis

BI offers insights into the past and opens the doors for predictive analytics and modeling capabilities. ERP-BI integration provides a complete view of past, present and future outcomes.

Real-Time Decisions

Leverage real-time data to make accurate decisions. Real-time data delivers real-time analysis and fosters business growth.

Drives Efficiency

ERP-BI integration facilitates organizations to consolidate, organize and analyze large datasets from different sources. It enhances analysis speed and provides business agility with clean and accurate data.

Reporting

BI enhances reporting capabilities by allowing users to incorporate huge datasets for in-depth analysis while accelerating the report generation process. It makes reports accessible to authorized users irrespective of their technical expertise.

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Conclusion

ERP systems help companies consolidate data and analyze their operations and processes, while BI platforms interpret large datasets to generate insights and suggest action. An integrated ERP-BI solution brings everything together to eliminate data silos, promote team collaboration and create robust reports.

How does ERP-BI integration help you achieve your business objectives? Let us know in the comments below.