What are the benefits of ERP enhancement?

Continuing this series of blogs about what I intend to propose as a new topic for my doctorate, today I want to leave the taxonomy of enhancements and think about what results I am supposed to achieve from the research. The title states that "benefits" - whatever they are - are to be examined. As one reviewer overlooking my work wrote at one stage (I don't remember exactly where) - let us not forget that this is a doctorate in Business Administration; there should be some effect on the bottom line.

My current thinking is that in an interview, I would ask "Can you give examples of enhancements which have been created for your system?" (after explaining what enhancements are). The interviewee would ideally give an example, which I would classify according to my taxonomy. I would then ask how the company functioned in this area before the enhancement and how it functioned afterwards. Finally I would ask what benefits the company has obtained from the enhancement; the obvious benefits are time saving and improvement in the ability to manage processes. Hopefully there will be more, which I haven't thought of. The interviewee would ideally give several examples.

Time saving can also be equated to money: the development of the enhancement cost money (consultant's fees) which hopefully is a one-off cost, whereas the time saved (which possibly translates to employee salary) is a constantly recurring saving. I doubt that any jobs have been lost due to ERP enhancements, but maybe enough savings can be combined, thus allowing overheads to be reduced.

One benefit arising from "the ability to manage processes" would be a reduction in inventory (this was certainly the original aim of my work with WaterCo), which translates directly into money. Every company which has inventory wishes to maintain the smallest amount of inventory possible whilst at the same time maintaining sufficient inventory to fulfill customer orders as soon as required. This balancing act requires knowledge about the needs - the amount of inventory required - and the resources - how much there is. 

Another area having great effect on the bottom line is debt collection, or 'accounts receivable'. Here, the standard reports in Priority should be sufficient, but there is always room for improvement and/or personalisation. More efficient debt collection improves a company's working capital, which is always a good thing (companies can be very profitable but can run out of cash at the same time, if their customers don't pay).