Typical ERP key figures and their significance
ERP systems cover almost all areas of a company. The key figures that can be derived from them are correspondingly diverse. Here are some practical examples from various specialist areas:
Finance
- EBIT (Earnings Before Interest and Taxes): Shows the operational earning power of the company, irrespective of financing and tax structures.
- Days sales outstanding: Indicates the average number of days it takes customers to pay their invoices. Long terms tie up liquidity and increase the risk of default.
- Cost center reporting: Shows where costs are incurred in the company and enables targeted measures to reduce costs.
Sales
- Incoming orders: Shows the development of new orders over a period of time. Early indicator for future sales.
- Hit rate (quotation rate): Ratio of orders won to quotations submitted. Low ratios can indicate problems in pricing or offer quality.
- Sales per customer: Helps to prioritize key accounts and develop customer retention strategies.
Purchasing and warehouse
- Inventory turnover rate: Measures how often stock is sold and replaced within a period of time. Low inventory turnover rates tie up capital and increase storage costs.
- Supplier punctuality: Proportion of deliveries that arrive on the agreed date. Important factor for production reliability and customer satisfaction.
- Stock range: Shows how long the current stock levels are sufficient to cover demand. Important for liquidity and avoiding bottlenecks.
Production
- OEE (Overall Equipment Effectiveness): Overall equipment effectiveness. Combines availability, performance and quality of a machine or system into a single key figure.
- Reject rate: Proportion of defective products in total production. High rates mean higher costs and quality problems.
- Lead time: Time from start of production to completion. Short lead times improve flexibility and customer satisfaction.
Human resources
- Employee turnover: Proportion of employees who leave the company in a given period. High values often indicate dissatisfaction or competitive pressure.
- Overtime rate: Indicates overloading of individual areas or insufficient capacity planning.
- Costs per employee: Important key figure for personnel cost planning and management.
Advantages of system-supported KPIs from the ERP system
Many companies struggle with scattered data sources: Excel lists here, isolated specialist applications there. This often leads to the following problems:
- Time delays: Data has to be merged manually – an effort that ties up resources.
- Inconsistencies: Different data sources deliver contradictory results.
- Lack of up-to-dateness: Many key figures are based on data that is already out of date.
This is where the major advantages of an ERP system lie:
- Central data source: All data comes from one system. This ensures that all departments work with the same, consistent information.
- Up-to-dateness: Many key figures can be called up almost in real time – an enormous advantage in dynamic markets.
- Automation: Reports, dashboards and key figures can be generated automatically, which saves time and reduces errors.
- Transparency and drill-down: Conspicuous key figures can be traced directly back to individual documents or process level. This allows causes to be identified more quickly.
- Better basis for decision-making: Decision-makers receive precise, up-to-date information and can react faster and in a more informed manner.
Conclusion: Using ERP KPIs Effectively – Make Informed Decisions with Real Data
KPIs are indispensable for solide corporate management. However, they only develop their full value when they are based on a consistent, up-to-date database. This is where ERP systems offer a decisive advantage: they deliver KPIs directly from the processes, enable automation and ensure uniform data accuracy. Whether finance, sales, production or personnel – with system-supported KPIs, companies can measure, compare and improve their performance in a targeted manner.
If you want to be successful in the long term, you should therefore not only know which KPIs are important, but also ensure that they are obtained reliably and efficiently from the ERP system.
