By housing and integrating data in one location, an ERP automatically diminishes department silos. For example, placing the accounts payable vendor database and procure-to-pay process in the same spot means treasury knows the value of the day’s outbound payments and expected future payments. Likewise, the accounts receivable customer database and order-to-cash process assists treasury with expected and actual incoming receipts.

A single data location also makes it easier to monitor access points, which, in turn, improves data security. The ERP’s firewalls and restriction controls are similarly beneficial in guarding against data breaches. In addition, many ERPs feature built-in regulatory process standards and compliance reporting, making it easier to manage Sarbanes-Oxley Act compliance, segregation of duties, financial oversight and approval workflows.

Cash forecasting is time-intensive and inherently prone to human error—two issues that can be reduced with an ERP’s built-in business intelligence features and reporting capabilities. The best way to leverage these features is via add-on tools that automate working capital functions, such as order-to-cash, purchase-to-pay and management of credit facilities. This way, your internal teams can pull the most accurate, up-to-date budget, sales, and accounts receivable and payable information.

Bank connectivity is one of the most important functionalities of an ERP. There are many methods of delivery associated with efficiency, but establishing direct connectivity between your ERP and bank provider is the standard option. Additional methods of establishing connectivity include the Society for Worldwide Interbank Financial Telecommunication (SWIFT) network, third-party providers and application programming interfaces.

Third-party software connectivity is also a vital function of ERPs. No matter what ERP modules you purchase, the integration between your ERP and business applications should work seamlessly. File transfer capabilities play an important role in establishing this continuity. For example, an ERP can deliver accounts payable’s payment transactions to your bank in a single file format, regardless of payment type, allowing for one file transmission to your banking provider daily. The ability to ingest a transmission from your banking provider is equally important, such as a prior-day file transmission to assist in bank account reconciliation, and a lockbox file transmission to assist with the cash application process. Take into consideration the modules you’re likely to need as your business expands, especially if your current ERP isn’t as comprehensive as you’d like. After all, you don’t want to end up back in the same position in a few years, trying to find a comprehensive ERP that enables the business to expand.

With streamlined and closely monitored processes, you’re more likely to anticipate operational issues and their financial impacts. That isn’t the only way your ERP can provide cost savings, though. ERP providers often handle technical assistance, so you can avoid the costs associated with patches, updates and troubleshooting. And although it isn’t a true operational cost, don’t underestimate the amount of time spent generating reports from multiple systems, which an ERP should be able to reduce significantly.

A robust ERP can also improve the management of your supply chain from beginning to end. For example, it can provide information on internal and external factors affecting production and cost, such as scheduled machine maintenance and repairs.

Likewise, an ERP can provide visibility into inventories, standardize replenishment activity and help manage materials procurement, including supplier base, quote requests and purchase orders. By integrating these three areas of your business—inventory, purchasing and supply chain management—you’ll be able to prevent inventory overstock and keep purchasing informed for better control over orders, delivery times and costs.

Your ERP should be able to capture and integrate all incoming and outgoing transactions, including payments, general ledger, bank reconciliation and expenditures. By utilizing your ERP’s real-time dashboards with expenses, key revenues and receivables metrics, you can better monitor your business’ financial performance, which helps with balance-sheet and tax management.

Similarly, your ERP should ingest the prior-day reporting file transmission from your bank partner(s) and provide the basis for your cash management team’s cash position activity. Knowing starting balances allows you to calculate intraday changes, payments and receipts. It also helps you determine how you’re going to fund operational balances today, specifically if your company needs to borrow or redeem an investment to satisfy other day-to-day needs.

Reporting is another time-intensive task your ERP should simplify. Automating tedious manual processes, such as data entry and report generation, allows teams to focus on their core deliverables. A robust ERP can generate reporting for different departments, business units and client relationship managers. In addition, an ERP can help optimize cash management by creating financial reports in accordance with company requirements and managing the business’ financial performance via real-time dashboards that display expenses, key revenues and receivables metrics.

Ultimately, an ERP’s ability to integrate various systems through automation, visibility and connectivity can lead to greater organizational efficiency from both a time and cost-management perspective. For example, automating data entry and report generation not only reduces the time spent on tedious manual processes, but allows teams to focus on their core deliverables. And by connecting the individual parts of your business, you can see—and eliminate—overlapping and incompatible technologies. These efficiencies may seem small when looking at individual departments, but can add up to significant time and cost savings when they reverberate across the company.