Managing Human Capital with ERP

ERP is often described as the backbone of a company, but in my opinion the spinal association is less than exact. Using an anatomical metaphor is great, but let’s go beyond quick assumptions and get it right. Perhaps it would be better to say that ERP is like the Central Nervous System (CNS), the all-important connections that run from your brain down the spinal cord. Like ERP, the CNS integrates all the body’s information, triggering, adjusting and coordinating everything our bodies do. This change of metaphor frees up the backbone, which I think is better used to describe the role and function of Human Capital – the most important driver for making an ERP solution useful.

At SYSPRO, we know that companies stand tall (or slouch off into oblivion) on the strength of their human assets. In fact, it’s no exaggeration to say that the most important function your ERP is designed for is to enable your employees to achieve maximum results, followed in priority by record keeping, analysis tools and building a data library for future trends and cycle identification.

ERP-enabled HR has the power to make a workplace considerably more productive by making jobs easier, and by providing management with information on productivity.

Making Jobs Easier

Depending on your company and its layout, ERP can create a technological platform that allows employees to complete their tasks with increased accountability. It accomplishes this task by removing needless duplication, automating parts of everyday jobs, identifying and eliminating non-value-add activities, and by breaking down the insular “silos of information” that plague so many companies.

Providing Management with Productivity Information

One of my favorite adaptations of ERP is to tailor the system to gather information on employee productivity. This provides a bird’s eye view of business operations that includes everything from time management to vitality of company goal-setting. You can then use this information to determine where to improve and how to change your mode of operations in favor of increased productivity and efficiency.

For example, using labor costs by work stations within the Bills of Material module allows for accurate costs to be forecast. When labor costs are posted against a particular job, variances may be seen between expected and actual expenditures, allowing job-to-job comparison and work station efficiency analysis. If the variances are consistent it probably means that the work station requires more resources, such as training, machine upgrading or maintenance. As always, improved information leads to better decision making, with benefits accruing to the company and its employees.

Creating a More Positive and Productive Workforce

ERP helps maintain a more conscientious presence in a company’s daily workings, so those important warnings don’t go unnoticed. Triggers should be set up for out of margin transactions, notifying management before little issues become very large problems. Well-maintained metrics can help to create a more positive and productive workforce for the benefit of your company and its employees.

An ERP system is an essential tool for making sure that decisions are made with transparency and trust. Which is exactly what everyone wants, isn’t it?


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