ERP Systems Advantages & Disadvantages

We live in an era of a technological boom. Software and systems have taken over every sphere of our lives, and the business sector is no different.

These days, the ERP software in Bangladesh is very popular. Many new and old companies are implementing ERP software into their systems. But is it really a good investment?

To find the answer, you need to go through the ERP system’s advantages and disadvantages.

A Brief Overview of ERP Systems

Before getting into the pros and cons, we need to understand the topic at hand. What is this ERP system that is creating a lot of buzz? The full form of ERP is Enterprise Resource Planning.

ERP is software that integrates the day-to-day resource management of companies. This software can be integrated across different departments of a company. The basic idea is to centralize the company database and simplify other company functions.

ERP works with accounting, supply chain, CRM, manufacturing, inventory management, human resources, and other departments. It optimizes the operations of these departments. As a result, employees can manage their tasks efficiently. Thus, the system can increase revenue margins.

5 Advantages of ERP Systems

Most companies will find many benefits of ERP systems. It is a great software to run a smooth business. Among all the benefits, here are 5 key advantages of ERP systems.

Visibility to Company Functions Across Departments

This is one of the biggest advantages of ERP systems. The software enables you to keep track of different departmental functions. The information runs centrally through every department head to the higher authorities.

This also allows employees to collaborate properly. As a result, you can expect coherence works with better efficiency. A very simple example can be monitoring inventories. You can check inventories levels daily and plan strategies accordingly.

Better Reporting and Planning

The ERP software will enable you to report the departmental activities. You can find a report on every function and process because the software automatically generates a very informative report.

The report can also help in planning for the future. The BI functionality of the system will allow you to get in-depth of company functions. These insights will keep on improving company strategies.

Improve in Work Efficiency

This goes without saying that a centralized system is always good for efficient works. ERP is very famous for reducing time and effort to complete any project. Employees know about the process. They can also give up on repetitiveness.

Better Customer Service

Company customers also feel the advantages of the software. ERP is a great software to use for Customer Relationship Management.

Any customer information is centrally stored in ERP. As a result, the sales team can manage customer information. This will enable the team to generate ideas targeting each customer segment. The marketing team can also create plans for customer acquisition, attraction, and retention.

Increased Collaboration

Finally, ERP ensures collaboration in and across the department. Employees can connect with different departments and collaborate. This can ensure quicker results. The workflow of the company also maintains proper channels.

3 Disadvantages of ERP Systems

It can be tough to find the disadvantages of a system this good. But every software has its cons. Here are 5 disadvantages of ERP systems.

The Cost of the ERP Systems

ERP systems can be a huge investment. You will need to allocate a significant budget to install and maintain the system. This is also the biggest disadvantage of the system. As a result, it might not be a suitable choice for many small businesses.

Customization and Maintenance Efforts

It is very beneficial to customize the software according to company needs. But doing that may take you a lot of time and effort. It can be even harder, especially after the customization. You will need a skilled workforce to maintain the software running smoothly.

Policy Related Problems

No software is best at solving policy and procedure-related problems. ERP is no different. ERP systems cannot ensure that everyone follows the rules and regulations, and it cannot maintain proper oversight and implementation of \.


In conclusion, ERP systems are complex and challenging software to use. You will need skilled technicians to handle the software for daily use.

Yet, the system has many benefits for medium and large companies. There is only a few software that can ensure such smooth workflow and efficiency. Apart from the costs, it is a worthy investment for growing businesses. ERP system’s advantages and disadvantages mixtures make it a commendable software to install.