Optimization of business processes in manufacturing companies using the ERP system

Optimization of business processes is nothing more than actions aimed at achieving the highest possible efficiency while maintaining a balance between the amount of work put in and the benefits achieved.

Optimization of business processes is nothing more than activities aimed at achieving the highest possible efficiency while maintaining a balance between the amount of work involved and the benefits achieved.

What does this mean in practice?

Looking through the prism of the operation of operating systems, it is necessary to strive to ensure that each emerging task, included in the entire process, is performed with the least possible involvement of resources, without disrupting the implementation of other tasks and, consequently, without limiting the continuity of the entire system. Moving on to the field of enterprise operations, it is necessary to properly plan the execution of all process tasks in the appropriate order, effectively allocating available resources and minimizing costs, and in the next step, to carry out tasks in accordance with the adopted plan. In the case of an enterprise, optimization is in fact a very difficult task due to the usually quite significant dispersion of resources and high variability of external factors that prevent or significantly hinder the implementation of tasks in accordance with the adopted plan. Taking the above into account, when modeling business processes, it is necessary to remember the existence of these limitations and, if possible, predict their occurrence and program appropriate actions to minimize the effects of their occurrence. Such actions are an element of the so-called process standardization, i.e. modeling the process map aimed at making it transparent, more understandable and predictable. Although standardization usually increases the complexity of the entire process and often requires the involvement of additional resources, it should be an integral part of business process optimization.

What is worth optimizing?

Optimization should cover processes of significant importance and impact on the functioning of the entire enterprise, and especially those that, in the opinion of the organization itself, are ineffective or problematic. It should be remembered that optimization is justified only when the benefits resulting from it are measurable and economically viable. In every organization, you can find processes that operate inefficiently to some extent, which does not mean that these companies need to optimize them. Additionally, it should be remembered that it is impossible to optimize all processes at the same time, because some processes may be correlated with others and a rational assessment of the justification for their improvement may be impossible at a given time. Considering the above, when planning the entire undertaking, all processes should be carefully verified and the optimization process should be planned "in moderation", perhaps using an "agile" approach (incremental optimization).

Why is optimization important?

The importance of optimization is crucial from the point of view of the efficiency of the entire organization and its ability to grow. Well-modeled and organized business processes cause the efficient operation of the enterprise, increase its stability and predictability, which in turn is a necessary factor in the growth and development of the business. Additionally, the cost efficiency of the company's operations should be accepted as a mandatory criterion.

What is the role of the ERP system in optimizing business processes?

A well-implemented ERP system, faithfully reflecting the actual business processes taking place in the enterprise, is a key element of the entire organization. It is the equivalent of an operating system in computer systems, ensuring efficient communication and the flow of information necessary to maintain the efficiency and continuity of the entire organization. The ERP system is a set of tools that allow you to control and steer the processes taking place in the enterprise, in accordance with the adopted model of its functioning. Considering the above, the ERP system is not a tool for optimizing business processes, but software supporting the optimal functioning of the organization. Regardless of this, the optimization of business processes often coincides with the implementation of the ERP system, because it usually takes place as part of the pre-implementation analysis aimed at properly modeling the business processes in the enterprise using the ERP system.

Summary

The basic idea of any business activity is, or at least should be, growth, i.e. continuous development and increasing its potential, scale of operations, range of products/services offered, conquering new markets, etc. According to some sources, the basic criterion for assessing the overall condition of an enterprise is its ability to continue to grow. A healthy enterprise is one that is developing, which is easy to see when looking at the leaders in virtually every industry. We live in times of dynamic technological growth and every enterprise sooner or later (of course, sooner is better than later) must face new challenges, such as:

• Business Development and Expansion
• Increased competitiveness
• Digital revolution
• Industry 4.0.

Looking from this perspective, I would like to conclude this article by asking several important questions for every organization, in particular:

• Is your organization ready for the new challenges that are emerging?
• Is your organization's "operating system" able to meet new requirements?
• Do you have the right tools to help you face new challenges?
• Do you know how to improve the efficiency of your business?
• Maybe this is the right time to start thinking about change?