This ERP software has helped many corporations become more efficient by managing their sales, production, planning, material management, finance /accounting, execution, and logistics among other areas to increase competitiveness within the industry. SAP and other ERP software have proven effective in managing business in a diverse and changing world (TsaI & Hsu 2010). Therefore, embracing an ERP system will help managers and subordinate workers be informed about everything that is happening in the organisation, and promote communication, and collaboration. One of the reasons why many SMEs are using ERP system is to cost management since unifying various systems under ERP software and sharing information is cheaper than using various systems in each department (Dunaway & Bristow, (n.d)). Cost management is one of the most essential concepts that many organisations are adhering to achieve in the running of the businesses. For instance, the implementation of ERP software can reduce IT costs significantly, and promote the success of e-commerce and e-supply chain (Hamilton …show more content…
2009). According to Dunaway & Bristow (n.d), the use of ERP system has helped many organisations formulate informed decisions about resources management across all departments, and understand business performance and development. Hence, ERP software plays a critical role in managing potential growth within an organisation. Moreover, this resource planning software has become popular because it helps organisations improve productivity by increasing efficiency in the overall system (Brown & Nasuti 2005). For instance, since having a central database eliminates time wastage, workers can in return use their time much effectively rather than chasing information from one department to the other. Organisations without centralised database are known to waste more time performing a task compared to firms that have linked all departments and can easily share essential information. Additionally, ERP has proven effective in business since it plays an essential role in inventory and production management (Hamilton 2003). The use of ERP has led to improved inventory management since the system reduces overages, enhances timely delivery, and improves overall production through optimisation rather than using guesswork (Grabski et al.