What is ERP in human resources?

In the dynamic business scenario, we currently have, modern organizations can grow at a dizzying pace. As a company grows, it develops new areas to work efficiently. However, when these areas are many and too big, managing the organization could turn into a difficult task. This is where ERP systems prove to be beneficial.  

What do you know about ERP systems and their impact in Human Resources? This is a particularly interesting topic since we are talking about technology that can streamline all the internal processes of any organization. At T2W we have an extensive experience in Human Resources management, so we are familiar with this technology.  In this article, we’ll delve into the concept of ERP in Human Resources and its benefits.  

What is ERP? 

Let’s start with the basics by addressing the main question: what does ERP mean? ERP stands for Enterprise Resource Planning. This is software that allow companies to manage information and optimize its internal processes. A common problem among modern organizations is the lack of integration among its different areas. While in many cases each business area can work efficiently, the lack of connection affects the company’s overall performance. 

That changes significantly with an ERP. Through this software, you can integrate all different business areas into a single system. As a result, you can share information, see real-time changes in general processes and monitor their progress. Several years ago, this type of system required a considerable investment in hardware and software. Nowadays, you can access an ERP system from anywhere in the world through cloud technology, which is very affordable. 

Modules 

To integrate different business areas, ERP systems are structured based in a series of modules. Each one of these modules can be created depending on the business areas the company deems necessary. Therefore, these modules can change considerably according to the nature of the organization. In general, the most common modules are associated to the areas of procurement, supply management, logistics, customer service, accounting, Human Resources, among many others.  

What is ERP in human resources? 

An ERP software can be applied to Human Resources through one of its modules. This way, Human resources processes can be managed together with those of other areas. In addition, many ERP systems are compatible with Human Resources Information Systems (HRIS). As a result, Human Resources professionals can manage directly all the information related to employees, analyze their performance and make all the necessary changes. 

For example, managing payrolls requires the collaboration between the areas of accounting and Human Resources. Payroll managers require specific information about all employees in the organization: their number of hours they worked, days off, bonuses, etc. Human Resources professionals should provide this information, but updating all that data can take some time. 

An ERP system offers a unified platform in which both areas, Human Resources and accounting, can enter information about employees and edit it if necessary. In fact, employees themselves can change their personal details. In many ERP systems, employees can create their own personal profiles that unifies all their relevant information for Human Resources and other areas.  

Likewise, some systems ERP also can integrate with different ATS systems. As you know, ATS are systems that help recruiters throughout all the talent acquisition processes. Consequently, an ERP integrated with an ATS system allow you to monitor closely all the recruitment processes and many other tasks in one single platform.  

Benefits of an ERP in Human Resources 

1. Collaboration 

With an ERP system, all the different areas of the company will be integrated. As a result, collaboration between these will be easier and more fluid. Processes that must go through different areas are visible through the system in real-time. The system also allow communication between members of different teams, which enables collaborative work. 

2. Productivity 

An ERP system provides a detailed look at the status of all the processes inside the organization. Each decision or incident is visible for leaders and decision makers. They gain more control and are able to act or make changes quickly and with more precision. This improves company productivity greatly.  

3. Transparency 

On the other hand, since ERP systems interconnect processes of all business areas, everything is done with more transparency. This is perfect for companies that need to show their stakeholders and other interested parties the transparency with which they handle their internal processes. 

We have taken a look at ERP systems in Human Resources and its possibilities. Integrating this type of systems into your internal processes will help you boost your company’s performance.  

At Talent2Win, we strive to align your company’s business objectives with the best Talent Acquisition strategies available. If you want to learn more about the services we offer, do not hesitate to contact us.