Where’s the ROI in an ERP solution?

Every manufacturer and distributor is different. And every company will get a different return on their investment (ROI) on their ERP solution.

Where will your organization find the payback? Some areas are rich with opportunity. On average, companies see a return of more than $7 for every dollar they spend on an ERP project.

When an ERP project is considered, one of the first tasks is to determine the ROI your more efficient organization could realize with new technology and improved processes.

At the basic level, your return will come most directly from more efficient production and resulting reductions in operating, inventory and labor cost. But the benefits can be indirect, too.

Optimized processes streamline ordering, eliminate physical inventory, improve production quality and enable more efficient scheduling. Improved access to operational data offers more accurate materials planning, streamlined reporting, new dashboards and better, data-supported decisions. And there will be ROI driven by increased customer satisfaction, enhanced supply chain communication, delivery performance, and more.

10 Core Areas for ROI Realization

Here’s why it’s important to determine ROI: It will provide the justification for your project. It will inform the software selection process. It will set up areas of focus and measurement – and give you the ability to determine whether your transformation process is a success.

When your organization sets out to make the business case for an upgraded or entirely new ERP solution, the search for potential ROI starts with these 10 core process areas:

Financial Management

Management and the entire organization benefit significantly from increased confidence in financial results and analysis, accelerated information access, faster closing and period-end activities, and efficiencies driven by reduction (or elimination) of outside-the-system spreadsheets.


With the improved information and analysis that comes with robust Sales & Operations Planning (S&OP) capabilities, it’s possible to more accurately forecast demand, make more informed decisions, to take advantage of trends and, most important, to be able to quickly, precisely and proactively manage changing sales demand, handle market changes, disruption and economic shifts, and more accurately plan production and resource capacity.

Inventory Management

Better visibility into sales demand and improved forecasting enable more accurate inventory management, lower carrying costs and improved visibility into slow-moving and dead inventory.

Product Development

PLM provides the ability to effectively manage product lineup and mix, and R&D investments, and identify products that no longer meet the company’s strategic objectives.

Production Management

Better production management capabilities offer improved capacity planning, plus the opportunity to conduct detailed analysis of production bottlenecks, routing times and material movement, workforce utilization, plant and equipment utilization improvements, maintenance scheduling and machine uptime.

Quality Management

QM tools delivered greater visibility of product performance, as well as improved Return Material Authorization (RMA) root cause analysis, visibility into rework activities, and better information on raw materials quality, supplied component products and third-party services.

Sales Management

Customer Relationship Management (CRM) capabilities provide comprehensive sales performance analysis and deliver an important insight into customer buying patterns, customer demographic data, sales activities and sales performance.

Supply Chain Management

With improved inventory management, the entire supply chain can be managed better, delivering lower logistics costs, more effective supplier/vendor management (and higher performance), shorter lead times and data that can be used to support strategic sourcing and vendor negotiations.

Warehouse Management

Warehouse Management Systems (WMS) technologies improve speed and accuracy using high-efficiency managed pick-up/put-away, barcoding and routing.


Enabling direct-sales channels, or improving existing e-commerce efficiency and customer experience, offers a significant competitive advantage and cost savings. A robust e-commerce capability drives higher customer satisfaction, repeat buying, better forecasting and higher margins. And there will be efficiencies that come from re-organizing warehouse operations to support efficient pick-pack-ship especially in a less-than-case-order environment.

How Yfos Cloud ERP Can Help

Quantifying the return in these areas – and others – is the next step, a significant challenge, and where Yfos Cloud ERP can help with industry benchmarks, experience with similar projects, and business process improvement expertise.

If you need any advice or quotation please contact with us:

Website: https://bit.ly/3DtyNOL
More information: info@yfos.com.mx
Phone: + 52 (1) 8118656617