How to Improve Employee Productivity with ERP

Improve Employee Productivity with ERP

Improve Employee Productivity with ERP “Productivity is not just about doing more, It is about creating more impact with less work” “Are your Employees Productive or are they Just Busy?” Employees are the greatest assets of any company. Employee productivity & efficiency directly impacts the functioning of the organization. Naturally, it is important to focus on improving employee productivity.

What are the ways to improve employee productivity? How can ERP Improve Employee Productivity? Let us now discuss this in detail.

What is Employee Productivity?

Employee productivity is the value employee produces per hour of work. It is thus an assessment of the efficiency of an individual or group of people working together in teams.

For a manufacturing company, employee productivity is measured in terms of input and output. So, raw material, machinery, and manual efforts are the inputs used to produces the goods or services (output).

When the “same number” of people are “able to achieve more” in the “same” or “lesser” amount of time, we can say that employee productivity has increased.

What is the importance of Employee Productivity?

As Richard Branson says “Take Care of Your Employees and they will take care of your Business” Employee Productivity influences every function of the organization. Whether it is production, procurement, marketing, finance, sales & distributions, logistics, or customer service. Hence it is important to inspire & encourage your employees to perform to the best of their possible capabilities.

When you provide employees the right tools & resources; that save their time & efforts, take the stress away from their work, improve the way they can function, and enhance their efficiency; it gives them a sense of happiness & satisfaction. It keeps the employees motivated and boosts their morale to work towards adding value & achieving the objectives of the company.

How ERP Improves Employee Productivity?

An ERP Software helps to improve employee productivity by relieving the employees from doing a lot of tedious, non-value adding activities. Hence Employees can focus on adding more value to the organization. Let us now look at How ERP Improves Employee Productivity 1. ERP reduces paperwork & manual work by digitizing & automating routine Tasks Earlier a company used to gather data on paper and stored it in physical files. This involved a lot of paperwork, preparing & sending invoices, documentation, and so on. Although this work is necessary, it does not add value to the overall results of the company. Hence it makes sense to automate these tasks to provide employees more time on hand.

ERP Software captures data in digital format enables digitization and automation of a lot of routine, frequently-repeated manual tasks that involved paperwork, coordination, followup, etc. Employees are happy because now, the paperwork & manual work is “almost nil” or “bare minimum” required. This saves a lot of their time, they can perform their jobs faster, better, and achieve more in lesser time. With additional time on hand, they can focus on more productive activities.

2. ERP eliminates employee efforts in gathering & reconciling data across locations.

No duplicate data, No data reconciliation.

Before ERP, companies’ data & information was stored in spreadsheets by each department & location in Silos. Hence, a lot of time was spent in gathering data from various sources, coordinating with various departments, and reconciling the data to present the most accurate picture.

An ERP gathers real-time and accurate data across departments, functions, locations of an organization into a single central database. It takes away the stress of maintaining accurate data. Now employees get access to most accurate information at the click of a button from any time anywhere. They do not have to spend any time coordinating, follow-up, and data reconciliation.

3. ERP improves Employee Communication & Coordination with Alerts, Notifications, Reminders, e-Approvals Earlier processes were paper-based & person dependant. A lot of time was spent in meetings, follow-ups & approvals.

ERP Software helps define information flow, provides built-in reporting & workflow alerts.

Mobile Alerts & Notifications are sent to everyone concerned for immediate attention and taking actions as required. ERP facilitates sending SMS, Email reminders for pending actions, allows e-Approvals. This makes communication & coordination faster & more effective.

4. ERP makes Reporting Easy & Fast, saving a significant amount of time of Employees Business reports provide significant insights, highlight problems, and provide possible solutions to potential problems. However, before ERP, creating Business Reports was a very cumbersome & time-consuming activity. Moreover, it was prone to human errors. E.g. creating MIS Reports would sometimes take a few days as data was not present in a single location and therefore required a lot of coordination, reconciliation, and so on.

ERP Software makes reporting easy & super quick. ERP offers automated reports for financial performance evaluation, costing/expenses, monitoring functions like procurement, inventory, sales, quality, customers & more. Employees only have to submit the right criteria and commands to generate the required reports at the head office level or even drilled down to the transaction level. You can generate reports weekly or monthly as per the defined frequency.

5. ERP helps employees in making data-backed, faster, informed Decisions Before ERP, identifying trends, patterns, carrying out in-depth analysis was a very laborious activity due to the data being present in silos. Sometimes decisions were taken based on guesswork or gut feeling.

ERP software helps you to define the Key Performance Indicators for each & every department, function, review/monitor performance weekly, monthly based on KPIs. This guides the employees to move in the right direction and helps them to make concrete databacked, informed decisions to improve their personal & business performance.

6. Employees can Focus on More Productive & Value Addition Tasks As we have already seen, ERP allows employees to eliminate routine and frequently repeated activities. This means that employees can focus on more Productive & Value addition activities that can make a significant impact on the companies’ production & profitability.

Some examples of value addition activities employees can focus on are: 1. Increasing Supplier Base, Improve Supplier Relations, Improving Negotiation Leverage 2. Find Alternative, Cost-Effective Methods & Materials to improve efficiency & profitability 3. Identify areas of wastages, bottlenecks, and take corrective actions 4. Ensure optimum utilization of resources for maximum outputs.

5. Identify areas of cost reduction to achieve lower operational costs.

6. Get more time to service customers, improve customer satisfaction & customer retention.

When employees can see the value they add to the organization, it will give them a higher sense of achievement and motivate them to perform even better. Higher Motivation will result in Improved Employee Productivity.

Summary ERP software increases employee productivity. It significantly cuts down the time & effort of employees, takes the stress away from their operations. They can focus on value-added activities such as designing better business strategies for bringing speed in business, acquiring more customers, and superior organizational performance.