While sometimes used interchangeably, enterprise resource planning (ERP) software and accounting software are two entirely different systems. There are common features shared by the two, but a full-fledged ERP system includes features that benefit other areas of the business outside of finance. Many businesses rely on a number of tools or systems, in addition to accounting software, in order to manage the business, analyse performance, and make better decisions. ERP software brings many of these tools together into a single system. This eliminates the need for finding ways to share crucial business data between several different programs that might not always be compatible. However, this does not mean ERP systems are meant only for large businesses, with many small to medium sized enterprises across a range of industries all discovering the benefits of ERP systems such as Arrow Research Corporation’s Tencia accounting ERP software solution.
What Is Accounting Software?
Accounting software helps you manage the financial side of your business, and typically support the following:
- General Ledger
- Accounts Payable
- Accounts Receivable
- Sales and Invoicing
- Bank Reconciliation
- Financial Reporting
It isn’t unusual for accounting software packages to include a set of core features or modules and have several other modules available as optional add-ons. The optional modules are features that aren’t needed by all businesses, but they always relate to financial aspects of the business.
Accounting software helps streamline the collection and processing of financial transactions, making it easier for you to get an accurate summary of your organisation’s financial health, and allowing for faster decision making.
What Is Enterprise Resource Planning (ERP) Software?
When implemented and used properly, ERP software also allows for faster decision making, but by not being limited only to financial information, it lends itself better to holistic decision making. While ERP systems include accounting software – both core and optional features – it can also include features that allow for more comprehensive control and management of assets and stock, production or manufacturing, and customer relationships. While accounting software is focused on the financial aspects of the business, an ERP system encompasses various other aspects that have an impact on the finances too.
Many of the features found in ERP systems are available as standalone products, but with an ERP system, much of the data you need access to in order to manage your business and make critical decisions is centralised, reducing the risk of making decisions based on incomplete or outdated data, while also eliminating the need for duplicating data.
Contact Arrow Research Corporation or one of our trusted Tencia accounting package business, technology, or distribution partners to discuss your ERP needs.
Why an ERP Is Better Than Accounting Software
ERP software solutions are not meant only for large corporations employing hundreds of people. Small to medium sized enterprises involved in manufacturing, wholesale, distribution, health, professional services, and many other industries will also benefit from the improved cross-departmental integration and communication offered by an ERP system. And because many ERP solutions also offer a core set of components along with optional add-on modules, you never need worry about ending up with a system that is too complex or bloated for your needs. Other benefits of an ERP system over standard accounting software include:
By combining or integrating various different systems, ERP software gives all departments and business owners access to reliable, real-time information, allowing for faster, more accurate decision making. Data roll-up can be largely automated, reducing the risk of errors, and even the generation of specific business-critical reports can be scheduled.
Better Collaboration and Increased Productivity
Any organisation – regardless of size – that has multiple employees spread across multiple departments, will find collaboration and communication between departments and disciplines improve, with relevant employees having real-time access to accurate data from other departments. No need to request the data, or worry about the accuracy of it, which also translates into improved efficiency and productivity, with critical decisions in all areas of the business being made faster.
Improved Stock Control, Pricing, and Quoting
Whether looking at finished products or raw materials, real-time data updating, and cross-department integration means always having a better overview of stock levels, which in turn filters through to being able to adjust pricing and issue accurate quotes simpler and faster. This includes implementing and controlling special pricing for multiple variables, along with the ability to carry out bulk pricing updates that immediately reflect across all departments.
Comprehensive View of Business Operations
Standard accounting software gives owners and senior management a consolidated view of the organisation’s finances. An ERP system, however, gives a much more comprehensive view of multiple activities and business operations, including finances. While some of these activities and operations are distinct, they do all have some impact on finances, but, crucially, play an important role in the ability for relevant persons to make important operational decisions in a timely manner using accurate and up-to-date data.
Boost Customer Service
Standalone Customer Relationship Management (CRM) software works in some organisations, but in multi-department organisations and organisations with multiple smaller companies falling under the umbrella of a larger enterprise, a CRM system that fully integrates with other systems across departments or companies can significantly boost customer service. All departments are able to view all past interactions with each customer, along with a detailed history of transactions, pricing matrix, backorders, and more, not only helping simplify customer communication, but also contributing to customer retention, and the elimination of operational silos.
Contributes Towards Lower Operation Costs
The supply chain management components of an ERP solution can contribute significantly towards lowering of operation costs, with real-time data updating making inventory planning simpler and more accurate. Additional components that encompass procurement and management of vendor or supplier relationships contribute further when combined with data relating to your creditors, along with the analysis and comparison of job and time costing actuals versus estimates. Finally, the ability to make critical business decisions faster, using more accurate data, can also contribute towards lower operation costs in a number of industries.
Register for one of our regularly scheduled online ERP software demonstrations, or request an on-site demonstration to discover how Tencia accounting ERP software could benefit your business