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How is the future of ERP connected with Blockchain technology

Enterprise Resource Planning (ERP) system is the backbone of every business that processes the immense amount of data reliably and transparently. It involves supply chain operations, project management, compliance, accounting, procurement and risk management . By looking at ERP software as a whole system, organizations can increase its transparency by connecting all departments of the company together – ultimately resulting in quicker decision-making ability.

Therefore, companies have everything they need for setting the perfect conditions for business growth. But where does blockchain integration fall into a picture?

Blockchain and Business

 Blockchain is a distributed, decentralized, public ledger.

A blockchain is a digital system that records transactions in a way that's transparent and secure. This technology was originally developed as an open source platform for digital systems of business. But when it was applied to the world of finance, it became capable enough to create unalterable and manipulation-proof data for companies.

Blocks on the blockchain are made up of digital pieces of information while the chain is the database. Once the information is stored in a block, it is further verified and a hash is assigned. After the hashing process, that particular block is added to the blockchain.

The Benefits

As the world continues to embrace blockchain and ERP solutions, businesses are finding new ways to improve their processes.

For example, a manufacturer can now see the actual requirements of customers and what they feel after purchase rather than having limited information from sellers. This will allow them to be proactive on supply & demand, avoid the inventory shortages, enhance the internal system, etc.

Blockchain technology has already been used to track cryptocurrency transactions but it is even more useful in tracking every transaction that occurs within a business. Each transaction gets recorded in an immutable ledger which cannot be changed by anyone.

The blockchain is a distributed database that can be used to store information. It can be thought of as a decentralized ledger, which is a list of records that are verified and encrypted by multiple users.

The benefits of blockchain technology include:

  • Immutability of transactions - transactions can no longer be deleted, modified or even reversed. 

  • Increased transparency from top-to-bottom in the supply chain management system. 

  • Track shipping packages more efficiently and accurately than ever. 

  • Optimize the intercompany transactions with security. 

  • Real-time traceability of products to easily monitor the journey from the manufacturing unit to end customers.

The Hurdles 

Blockchain is not a new technology. It is being used to store data securely in many industries and has been proven to be safe and reliable. However, there are certain challenges that companies face when integrating blockchain-backed solutions into their existing ERP systems.

In order to successfully integrate blockchain into your existing ERP system, there are a few things to consider:

  • First, you need to identify the type of ERP software that your business is using. Not all ERP software can be easily integrated with blockchain technology. Some might require additional time and effort for integration while others may not be flexible enough for blockchain implementation.

  • Second, if you're using more than one ERP system within your digital environment, connecting them all together might become challenging without any issues arising from connectivity problems or compatibility issues between each system's database format as well as its software architecture design principles.

The Outcomes 

Use of ERP systems has been in high demand these days. The common benefits associated with this system are cost-effective, accessibility and transparent ways of working. These systems are useful for various processes of the firms. The implementation of blockchain technology will help the developers to create a decentralized business platform that will be used for customizing the standard features embedded in Internet protocol.

Siliconnexus has been also designing, implementing and customizing the ERP for over a year to global businesses. Contact us today if you are looking for any services. 

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