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Role of ERP in Banking Sector

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What is the ERP system?

ERP (Enterprise resource planning) is known as a business process management software which allows an organization to make use of a system that consists of integrated applications. The purpose of these applications are to manage the business an automate many back-office functions that re-associated with technology, services and human resources. This software mainly integrates all facets of an operation such as planning of the product, its development, manufacturing, sales and marketing all in one database, an application that is accessed from a single user interface.  This software has been designed to be used by large businesses and mainly used by the dedicates teams for customizing and analyzing the data and for handling the upgrades and deployment.  In comparison to it, small business ERP applications are the lightweight business management software solutions that are often customized for a particular business industry.

The need for ERP solution

When the businesses have to spend more time on daily business activities, it is the right time to implement the ERP solution. In other words, if it is taking longer to manage key activities of the business, ERP software integrates the solution and data in one system which can be accessed from a single platform. This will make it easier for various business units of the company to communicate with one another and do their jobs effectively. Moreover, if the business is having manual processes with multiple data sets, it shows that the business is having a high need of ERP solution. This is because most of the departments make use of their own applications and processes, it takes too much of time in duplicating the data entries. When the information cannot flow between systems, it takes longer to do so and this makes an error to happen, thus, this shows that there is high need of ERP solution which could integrate the data of all departments at one platform.

Types of ERP systems

There is a long list of the types of ERP systems. The first one is Generalist ERP, which is capable of adapting to the processes across industries. Such solution provides strong customization and integration features to match with the industry requirements that keeps on changing. Next is Vertical ERP, which is industry-specific EPRs and is mainly used by small businesses who try to focus on a small niche such as construction companies. Further, Small business ERP are the off the shell cloud ERP solutions that provide the companies with one or two business processes, instead of covering fully integrated ERP solution.

Features of ERP system

Here are some of the features of the ERP solution

  1. Financial management: This module allows the company to manage their capital inflow and outflow. This module covers standard Accounting and Finance transaction such as expenditures, general ledger, balance sheet, tax management and payments. This module mainly generates different financial reports for various departments of the businesses.
  2. CRM: The CRM Module of the system helps in boosting customer service and profits per capita. This module manages leads, opportunities and customer issues. Also, this module is closely integrated with Sales Module you keep the track of conversions.
  3. SCM: This module mainly covers the key aspects in the supply chains that include purchase order management. Also, this module manages product flow from production to the consumer A key feature of this module is that it offers process automation that streamlines the entire supply chain and makes it adaptive for sudden market shifts.
  4. HRM: This module provides the feature of HRMS tools such as time tracker, timesheet and database for employee’s record, job profiles and skills matrix. Along with that some ERP solutions also offers training sessions with the help of LMS

Use of ERP systems in banks

The banking sector is having a huge potential for applications of ERP because of its vats data-oriented nature. ERP tends to integrate various modules, information, users and the processes of banking for better productivity. This system helps the bank managers in making a decision that consists of strategic, tactical and operational planning with the use of technologies. This helps the managers in saving their time, reducing cost and effective communications. Apart from that, it offers a solution for various things which consists of cash accounting, payment processing, security of cash and cash management.

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