Data analysis in an ERP system – how to make the most of it?

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In this article, you will learn:

• Why ERP is a key system for data-driven companies
• How data analysis impacts customer relationships
• Which analytical tools on the market are worth considering
• Why implementing an analytical culture is important from the employees’ perspective and what to keep in mind

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Today, companies analyze and measure almost every aspect of their operations. Specialized data analysis modules installed within ERP systems are invaluable in this process. How can you maximize the potential offered by these types of tools?    

The potential of data analysis in an ERP system

One of the most frequently cited arguments for implementing an ERP system is the data analysis potential of these platforms. This stems from the fundamental operating principle of ERP systems – they integrate information from various departments of a company, which not only allows for managing operational activities through a single tool but also provides detailed insight into data. This would not be possible using independent, disconnected programs. Data is the foundation of virtually every company’s operations, and more and more enterprises are attempting to transform into data-driven organizations. Such a goal requires tools for collecting and analyzing information from diverse sources – ERP systems are very often chosen for digital transformation. Why is this the case? There are many answers, but one of the most common is the general increase in operational efficiency following an ERP implementation. By combining business processes into a single platform, and consequently analyzing data through one tool, it is possible to identify weak points in processes and procedures and then improve their performance. Data analysis in ERP also helps improve customer relationships – although at first glance this may seem difficult to quantify, by tracking things like order history or previous conversations, you can create offers or promotions tailored to customer needs. This also allows for the refinement of sales and marketing strategies to reach new audiences even more effectively.

Using data to make better decisions

Another frequently cited benefit of using data analysis in an ERP system is the ability to improve the decision-making process. In other words, if an organization has access to data and knows, for example, how much it spent on raw materials, it can make decisions such as reducing expenses by changing suppliers. Importantly, this decision can be justified, for example, by proving through data analysis that changing suppliers will save x thousand zlotys. Another example could be the use of operational data in data analysis. Because an ERP system collects information from all company processes, it is possible to better plan the activities of the entire organization. For example, in the aviation industry, an ERP system can collect data on technical inspections of an aircraft fleet, which allows for the quick detection of faults and problems that are not visible at first glance but are apparent in the data. ERP systems also support decision-making in other areas. They can be used, for example, to monitor KPIs, which may signal that changes in operations are needed. Importantly, all actions take place within a single system, so the entire decision-making process can be accelerated – it turns out that the seconds spent switching between programs can sometimes determine a company’s market position.

Data analysis and Business Intelligence tools

It is impossible to conduct data analysis without the right software and hardware. Today, analytical tools and Business Intelligence software are often chosen at the very beginning of ERP implementation work, right after selecting modules to handle the most important company processes. There is nothing stopping you from creating your own tool tailored to the organization’s needs, but implementing solutions used by others is an equally good choice. The modern market offers a wide selection of analytical tools, and the most commonly used include:

• Microsoft Power BI,
• Tableau,
• QlikView/Qlik Sense,
• SAP BusinessObjects,
• IBM Cognos Analytics,
• Google Data Studio,
• Sisense,

The listed programs differ in their features, but all possess tools for collecting and analyzing data, visualizing it, and integrating it with a large number of sources. They are also equipped with features for generating reports or automating processes, such as analysis.

Implementing an analytical culture in an enterprise

For data analysis in an ERP system to be fully effective, it requires not only tools but also the right attitude and knowledge from the employees who will use the platform daily. For this reason, it is not enough to choose the most modern solutions – you must also ensure the right organizational culture within the company. The first step in building this should be defining a clear data analysis strategy – all members of the organization should know why it uses data and what goals it wants to achieve through it. The strategy defines the direction and framework for the company, but people will be responsible for its implementation. It is therefore good to create a project team that will oversee its implementation. Beyond strategy, the most important element of building an analytical culture in a company is providing appropriate training for employees at various levels of the organization. Analytical skills can be practiced, but you need to know what to look for in the data – otherwise, it will just be a string of numbers to employees. In addition to training, it is also worth remembering to promote transparency – every member of the organization should have the ability to view current data about its operations and should be able to understand it. For this reason, it is also worth ensuring a user-friendly format for presenting it – charts and graphs say more than strings of numbers in tables. Above all, however, do not give up – introducing an analytical culture in an enterprise may require time and effort, but the benefits can significantly outweigh the costs incurred.