ERP Modules: Types, Features & Benefits

ERP modules are the building blocks of an ERP. Most ERP vendors cover all or part of the four main business areas:

• Sales & Customer Relationship Management
• Operations
• Financials
• Human Resource Management

A good ERP system is like an end-to-end project management solution for working in and on your business.

For example in manufacturing, the modules may include industry features like material resource planning (MRP), raw material procurement, job quoting, warehouse management and manufacturing execution systems (MES).

ERP modules break down complex business processes into manageable, interconnected components that work together to support overall business performance, improve communication and deliver cost savings.

A system with industry-specific ERP modules, unifies fragmented business functions, streamlining operations and reducing the cognitive burden on your team. By automating functions and centralising data, it eliminates manual work and data silos, leading to a single source of truth for the entire organisation. Real time data provides leaders with accurate visibility for proactive, data-driven decision-making. The result is a smarter, more connected operational foundation that improves collaboration, increases agility, and allows your team to focus on innovation and customer value.

The core benefits of an ERP system are:

• Automation: Frees up employees from manual, repetitive tasks in your supplier relationship management, order management, and project management.
• Data Centralisation: Creates a single source of truth, eliminating data discrepancies and improving trust. This gives you better data security, production planning and enables you to become a service centric company.
• Informed Decision-Making: Provides real-time insights for strategic planning, rather than reactive problem-solving. With finance modules connected to your operations, you can driver greater financial performance while enabling sales forecasting and expense management in supply chain planning.
• Improved Communication: Enables seamless information flow between departments, enhancing collaboration. Imagine as a manufacturing company, being able to use your contact management system to update customers during the entire production process for better customer satisfaction.
• Increased Agility: Allows the business to quickly adapt to market changes and customer needs. This gives you a competitive advantage in the market and supports your human resources to work at peak performance.

Ultimately, an ERP system isn't just a software tool; it's a strategic framework for building a more efficient, agile, and resilient business.

A financial management module includes accounts receivable, accounts payable, and general ledger. It handles financial reporting like balance sheets, income statements, and cash flow reporting. Additional components can include payroll, fixed assets, appreciation journals, and cost of goods sold. This provides comprehensive financial reporting, tracking, and insights across your business.

A procurement module covers the supplier or vendor process, starting with purchase orders and moving through order confirmation and receiving. This module manages and maintains control over spending. It confirms what was ordered matches what was received, preventing potential errors or fraud. This ensures that invoices are processed after proper verification, protecting your business's financial integrity.

ERP systems in manufacturing industries cover a range of modules including shop floor control, warehouse management, and production management. Manufacturing-specific modules tie together sales, quoting and estimating, job management, inventory and quality control, all the way through to shipping. Key functionality is designed to support specific manufacturing processes.

Inventory management is core to manufacturing, office technology and retail sectors. It involves tracking what goods are in stock, when to order more, and where to find the stock.

Businesses can approach inventory in two ways: stock based on forecasts, or stock allocated to specific orders. When a sales order comes in, the system can quickly check if the specific product or component is available. This prevents lack of visibility over accurate stock levels. It also supports order management by allowing you to quickly confirm if you can fulfil a customer's specific request.

For larger businesses, inventory management might involve tracking stock across multiple locations.

Warehouse management and logistics is a sub-module of inventory management. Not all businesses have just one warehouse - some have multiple locations in different parts of a country or overseas.

The key purpose is to enable mobile stock distribution, manage receiving stock, pack goods for distribution and track parts by lot or serial numbers for audits and recalls.

Supply chain management ties together purchasing, inventory, and warehouse management modules. It involves understanding lead times for components, especially for items sourced from overseas. Supply chain management modules provides visibility into how long it takes to receive goods to adequately plan your operations, including tracking fluctuations in costs.

For office technology providers, it can help you track OEM performance, service history, and track stock needs based on forecasts, which improve supply chain efficiency and logistics management.

The goal is to give businesses the ability to manage and improve their supply chain processes by having comprehensive information about their suppliers, delivery performance and cost tracking.

CRM supports serving customers, gathering customer history, and maintaining relationships. It helps you track customer history and understand customer interactions. For sales teams, CRM supports tracking activity levels, such as emails and quotes. It provides metrics on sales efforts and helps identify areas for improvement in customer engagement.

The key purpose is to help you stay informed about your customer relationships, support sales activities, and maintain ongoing communication with customers.

Human Resources and Workforce Management is important for mid-size to enterprise companies covering areas like health and safety, skills management, and payroll. It helps track skills for specific jobs and processes, manages pay rates, and provides insights into staff performance.

This provides you with visibility into your human resource capabilities, supports compliance requirements, and helps you understand your workforce.

Project management modules can vary between ERP systems. What one system calls a "project" might be called a "job" or a "workflow" in another system.

In some systems, a project can be multiple orders and jobs grouped together under one folder. For example, a construction project for a shopping centre or a mining project that might span several years, where multiple tasks and jobs can be tracked and totalled under one project banner.

What they have in common is that project management is a succession of tasks that needs to be carried out for a projected outcome. Often this core functionality sits within the operations function.

Although not usually a core ERP module, an ERP system can integrate with marketing tools for increased functionality to support sales. Marketing automation is quite common these days, involving email marketing, web tools, and social media.

Marketing automation is a complimentary tool to add to your ERP to help generate brand awareness and convert prospects to customers.

Service management is the ongoing support after a product or service is sold. It's about providing service after the initial sale, such as parts and servicing management.

Many businesses, such as office technology providers need service management capabilities to map service job routes, view inventory of parts in real-time and generate invoices on-the-go.

The key point is managing SLA minimum standards, improving customer satisfaction through efficiency and ensuring your field service team are connected with real time data.

Analytics and reporting is basic functionality in an ERP however advanced reporting may be a separate ERP module, either way you should expect some reporting included in your system. The purpose is to transform raw data across business units into meaningful insights. These reports provide metrics for you to manage your business and make informed decisions from.

The best ERP system is one where modules integrate naturally, with data flowing seamlessly within the platform. The less integration and customisation the better.

The system should have modules that integrate seamlessly, avoiding multiple software packages that need complex erp integrations.

The solution should allow different roles to easily access their specific business functions and provide clear visibility across business operations. Look for systems that can be implemented in phases and offer cloud-based solutions with reduced infrastructure costs.

Key considerations include ensuring the system has a maintenance and upgrade program, selecting a solution that matches your specific business needs, and avoiding unnecessary modules that add complexity.