With e-ERP, departments are connected internally via the internet and have better information flow. Internet-based ERP systems allow better reach to vendors, providing more competitive bids to companies. When payment and ordering are automated, processing and paper costs reduce. Furthermore, e-ERP enables companies to have fast access to detailed customer histories, providing useful information to improve planning and analysis (Enterprise Resource Planning Newsletter 2001).
Each department will understand and appreciate the contributions of other departments towards the company's overall objectives and goals. Having global optimum goals allows companies to stay focused and minimize waste of time and resources in working towards non-unified goals (Madu, CN & Madu, AA 2003).
Simultaneous Tracking of Orders
e-ERP ensures lateral transfer of information to various departments, allowing placement of orders to be tracked by relevant departments simultaneously and quickly relay information to the customer. This way, an operation's productivity is improved by reducing or eliminating non-value added time required to complete a transaction. With improved processing time, companies can provide better service to their customers (Bendoly & Schoenherr 2005). In addition, e-ERP helps companies cut down setup costs by eliminating the need of individual database in each department. Since departments do not have to re-enter customer order information, the likelihood of errors is greatly reduced, which will also lead to better customer service.
With integration and collaboration across e-business supported ERP, companies can enhance its just-in-time system to effectively manage inventory. This approach not only helps companies in handling delivery time from suppliers better, production planning and scheduling are also enhanced due to better information flow, which assist companies in making effective decisions.Market pressure has placed companies in a position to offer products and services at a reasonable price, at a rapid pace, with good quality and design that suits customers' needs and preferences. Increasing demands in the market has led to migration from traditional enterprise systems to internet-based systems.
Integration of systems such as e-ERP, e-SCM and e-CRM allows companies to efficiently and effectively produce goods that maximize available resources, according to customers' requirements (Madu, CN & Madu, AA 2003). For example when a customer places an order using the internet, suppliers can immediately track the order and respond to the customer with the projected cost, based on specific requirements, quantity and delivery time.
Each functional unit in the network can track the order of the customer from point of contact to point of delivery (Warkentin et al. 2000). As time is money, this speeding up of the turnaround time for processing reduces companies operating cost by minimising unnecessary time for information flow, as well as ensuring effective use of resources that minimises wastage (Bendoly & Schoenherr 2005).
Furthermore, intermediary departments such as purchasing departments may even be eliminated as customer orders are now directly linked to the suppliers' network (Warkentin et al. 2000). This of course means further cost reduction to the organisation. When operating cost is at its optimum level, companies have more margins to maneuver with. This can mean offering products or services at a more affordable price, which is favourable to customers, or having a higher profit margin that benefits the company. An efficient system also benefits business partners in the network with optimum turnaround time.
In today's business environment, sustainable competitive advantage is only possible when a company has knowledge about a customer that its competitors don't. Hence, there is a need for vast quantity of information about individual customer needs and perception about a company, to customise products and services on a one-to-one basis (Davydov, 2004).
e-CRM helps companies in building customer information to understand its customers. Companies are now adopting e-CRM with e-SCM and e-ERP to deliver customer configured products. An example would be Dell's Built-to-Order concept allows customer to select its own specifications (http://www.dell.com, 2/3/06). Once the systems are built Dell will arrange a number of custom delivery services, using its selected carriers, to best suit the customer's work environment and staffing constraints. Another example would be improved flow of order placement (Madu, CN & Madu, AA 2003).
When a customer places an order from the web, the order is transferred to the manufacturer's inventory and production planning systems, as well as the customer database for credit history checking and the financial system for invoice issuance. The details of the transaction is then recorded so that customer service representatives can better service customers and telesales personnel can leverage on the information to cross-sell other products (Xu et al. 2002). When company products are flexible with reasonable price and delivery time, customer loyalty and retention can be achieved. Larger customer base means higher market share for the company and its partners.
In today's turbulent market condition, it is a challenge for companies to achieve optimum level of resource management. Companies cannot afford to have over-supply or under-supply situations that will impact its overall profitability and affect turnaround time.
e-ERP and e-SCM systems are generally designed to improve the production flow of a company. While e-ERP focuses more on integrating different parts of an organisation to achieve synergistic benefits, e-SCM is aimed at rationalising procurement along the whole business value chain (Madu, CN & Madu, AA 2003). When integrated information flow, the Just-in-Time system enables companies to effectively manage its resources, from inventory to manpower to ensure no wastage or over supply. When resources are well managed, companies are able to minimise risk on its current assets. Also, using the Supply-by-Demand concept, internet allows companies to learn about the demand pattern by analysing internet users browsing habit, purchasing activities, feedbacks, enquiries, etc.
While e-ERP being the software backbone to integrate internal operations, e-SCM and e-CRM are increasingly being integrated with e-ERP to share same database information on customers. With quality data management, efficient and effective production process, respond time or feedback information to customer inquiries is quickened. Moreover, companies can gain deeper knowledge of customer preferences and habits by analysing the transaction history of a customer. This enhanced communication between customer, company and business partners adds value to the customers and improve turnaround time of companies