How to Integrate ERP With ECM

Today, enterprise resource planning systems (ERP) are the workhorses that control businesses' finance and resource management, with structured transactional databases at their heart. ERP systems control the goods (produced and procured), people (employees, suppliers and partners) and the network of interactions among them that both drive and characterize the business.

In parallel, many businesses have turned to enterprise content management systems (ECM) to manage unstructured data within their organizations, including scanned paper and other digital files, with workflow, reporting and automation to support the communication, collaboration and compliance activities within the organization.

Businesses might also have a range of other software that handles data about specific parts of their operations. They might have customer relationship management systems (CRM), which stores information about all of their leads and customers and tracks the business' transactions with them. They might also have other specialized software to handle business functions such as supply chain management (SCM), payroll, budgeting and communications.

Few businesses today can imagine functioning without an ERP system. Those that have invested in ECM solutions most often achieve a return on their investments within a year and also view those systems as critical to their business operations. Those that use CRMs and similar systems have typically incorporated them so thoroughly into their business that they have become essential for the company’s day-to-day operations.

Unfortunately, however, even with all of these systems in place, few organizations are satisfied with the results they have achieved because of persistent inefficiencies due to manual process gaps, combined with a lack of end-to-end process visibility.

The Real Opportunity for Innovation

In a 2015 Document Process Intelligence Survey conducted by the Association for Intelligent Information Management (AIIM), when asked about their current toolsets, close to half of respondents were less than satisfactory or in need of replacement. Only 10 percent indicated they are very or extremely satisfied.

The solution to this problem is to view it as an opportunity to upgrade and replace those systems. But it’s even more likely that the potential for true business transformation lies in bridging the gap between the systems that manage structured data (ERPs) and unstructured content (ECMs). After all, most business processes depend upon both to achieve their ends.

Uniting Data, Documents and Decisions

There are well-established reasons why separate systems exist to manage structured enterprise data and unstructured enterprise content. There are few good reasons, however, for those systems to be siloed, considering that they both contribute to supporting the majority of business decisions and transactions.

Basically, any decision or transaction that relies on data and documents will encounter inefficiencies when relying on disparate ERP and ECM systems. Often, the solution, rather than integrating the two, becomes “the two-screen solution.” With this approach, staff members manually monitor, review and interact with each system independently on two monitors and all too often manually re-key information from one system into the other, exposing processes to manual data entry errors and all kinds of potential compliance risks.

One solution to the two-screen problem is to leverage the documents captured by ECM systems more intelligently, relying on automation to identify data within an unstructured document or file source that conforms to data in structured ERP databases. Modern intelligent capture platforms can actually learn how to identify relevant data within a document like a vendor name or invoice amount. Integrating an ECM solution and other business systems with an ERP allows intelligent capture platforms to validate the information they discover, essentially relying on the ERP as the system of record to ensure that any information in the document is correct.

Extracting data from ECM documents allows organizations to automate routine processes like the three-way matching of purchase orders, invoices and receipts, supporting an automated straight-through-process for accounts payable (AP) approvals that results in automatic transaction entries in the ERP without any manual data entry. The process begins with the document in the ECM, data is extracted and validated against the ERP, and matched transactions are automatically entered in the ERP. Exceptions are routed for appropriate review and intervention. Everything happens seamlessly, with ERP and ECM systems working together and interacting intelligently to achieve the desired end result.

Below is an example of a process for extracting AP data from ECM documents and integrating it with an ERP:

1. Capture: The first step of the process is capturing unstructured data from the ECM. This data could come from either online or physical documents.
2. Indexing and Validation: The system then organizes the documents into categories.
3. Data Extraction: Next, the system pulls data from the documents. This may be done manually or with automation technology.
4. Validation: The ECM data is then validated against information in the ERP.
5. Repository Services: The system then sends validated and organized data to the ECM repository.
6. Integration With ERP: The system also sends the data to the ERP.
7. Transaction Matching: Matched transactions are automatically entered in the ERP
8. Review and Payment: If the system finds a perfect match between the ECM and ERP, it may post the invoice for payment. If it detects a discrepancy, it will send it to accounting staff or other employees for review.
9. Record Management: The ECM and ERP stores records, which employees may access and manage.
10. Reporting: The ECM system typically enables reporting, data analysis, auditing and other similar services.

The Results Are In — and Integration Wins

According to AIIM’s 2015 survey, for companies that have bridged the gap between their data, documents and decisions, the majority of users expect to achieve a return on their investment within 12 months. The reality, according to the same survey, is that results are usually better than that, with 63 percent achieving ROI within 12 months.

The benefits of ECM/ERP systems with intelligent capture include:

• Increased Efficiency: Switching from manual to automated processes can reduce inefficiencies in data entry, document sorting and classification. Automated routing can also help you to target and resolve workflow bottlenecks.
• Improved Data Accuracy: Manual data entry and re-entry can result in errors. When systems are siloed, it is more difficult to ensure that they contain the same information. Integration enables automated validation.
• Enhanced Productivity: When employees no longer have to manually enter data and manage documents, they are free to perform more strategic, value-added work.
• Increased Scalability: Automated processes, especially when powered by cloud technology, are easier to scale, as doing so doesn’t require adding staff.
• Increased Transparency: Integration enables real-time access to data, documents and decisions across all systems, increasing transparency.
• Improved Customer Satisfaction: These benefits ultimately lead to improved customer satisfaction. Improved information accuracy, for example, results in fewer errors in customer orders. Customers will appreciate the increased efficiency as well. Companies use manual processes ship 83 percent of orders on time. Those using automated processes ship on time 97 percent of the time.

Essentially integrating business systems results in more efficient, accurate processes, while also freeing up employees to focus on the core activities of the company.

How to Integrate ERP and ECM

Integrating business systems might not look the same for every company. Before you begin the process of integrating systems and creating a strategy for doing so, you should review your current data management environment. Gather information such as:

• The systems currently in use and how they relate to each other
• The proportion of paper documents vs. digital documents
• The average timeline for document and data processing
• The accuracy of processed data
• The resources devoted to the handling of documents

You can use this review of your existing processes to identify the goals you hope to achieve through the use of ERP integration solutions. These objectives will help guide you throughout the process. You may have identified some of the benefits listed above as things you’d like to achieve. Perhaps, you want to improve the accuracy of your data, speed up invoice processing or use automation to free employees from the burden of manual data entry. Set measurable goals so that you can track your progress. Examples of such targets include reducing customer information data errors to a certain percentage and reducing invoice processing time to between one and seven days.

Developing an Integration Strategy

Next, you can outline a strategy for achieving these objectives. Decide what technologies you will use and the processes that will guide their usage. If you don’t already have an adequate ERP in place, you will need to deploy one. You might also choose to launch a new or upgraded ECM or CRM. After ERP, ECM and CRM implementation is complete, you can start to plan their integration. The three main steps of creating this strategy are:

• Choose Data Capture Software: First, you will choose data capture software. Intelligent data capture software, such as Artsyl’s docAlpha and the Cloud, can automatically organize documents and extract data from them using self-learning technology.
• Choose Process Applications: Once you have this software, you can choose smart process applications. These applications are built on top of Artsyl’s data capture software and can help you to automate your business processes. You might use applications designed for accounts receivable, accounts payable, sales order processing, human resources onboarding and other processes.
• Configure Workflow Processes: You can then set up the software by workflow processes for classifying documents, recognizing data, reconciliation validating, reviewing and approving documents. The docAlpha system is easy to customize to your business' needs and uses a visual drag-and-drop interface for workflow process configuration.

You will also have to choose whether you want cloud-based software or software that you will host on your own systems. Artsyl offers both options. Both have advantages, but cloud-based has recently begun to grow in popularity. Since 2013, the rise in interest in cloud ERPs has prompted companies to evaluate their existing systems and processes to determine how to lower costs and achieve their business objectives more efficiently and effectively. However, the main driver has been innovation rather than costs savings. Cloud-based systems offer the benefit of access to software on Internet-connected devices across various locations. Artsyl’s cloud-based data capture software also enables the self-learning technology to get better faster since it can learn from all of the businesses that use the cloud. With cloud systems, you also don’t have to worry hosting hardware or software onsite, conducting maintenance or performing repairs.

In reality, any organization that chooses to evaluate cloud ERPs has chosen to look for a better way to manage their business. Any company that truly wishes to achieve greater productivity will have to look at the gaps in their existing systems and processes. All of them are likely to find that manual data entry, manual document routing and manual process monitoring is creating process bottlenecks, introducing potential error and compliance risk, and limiting visibility to the overall process due to siloed systems.

Creating a Deployment Schedule

For businesses rolling out a new integrated process involving ERP, ECM, CRM or other systems, it’s advisable to do so in phases to make the transition smoother.

In the first step, select the staff with which you will start introducing the new process. If your business is smaller, you may be able to introduce it to all of your staff at once. If it is larger, you may want to choose a subset of your staff to make the transition more manageable. Once you’ve selected the employees, you can start introducing the integrated process. In this phase, you can test technologies and approaches to see what works best. By the end of this step, you’ll have decided how you’ll capture and manage data.

In the next step, launch the integrated system to your entire staff, if you haven’t done so already.

Then, monitor the effectiveness of your new process over a period of time using the reporting functions. If you notice problems or inefficiencies, adjust the process accordingly. Depending on the scale of the changes, you may want to go back to phase one or skip directly to introducing the updates to the whole staff. If the process is running smoothly, but you identify areas for potential further improvement, you could start introducing more complex capabilities.

The Artsyl Approach

With Artsyl, your company can eliminate the inefficiencies, costs and errors that come along with manual document handling and data entry. Our solutions can help you to improve the efficiency of your business processes, empower your staff to be more productive and help you turn your data into decisions and action.

Just because our software is powerful, though, doesn’t mean it’s hard to set up or use. With our solutions, you get the benefits of improved efficiency and functionality without the need for coding knowledge or extensive customization. It’s also designed to make integration of ERPs, ECMs, CRMs and other business applications easy.

Our data capture software, docAlpha, features many valuable capabilities including self-learning intelligent extraction, automatic document classification, recognition of machine-printed and hand-printed text, barcode recognition and automatic redaction of sensitive and confidential information. We provide our software as both a client/server solution and a software-as-a-service offering using cloud technology. We also offer a range of smart business applications for use with our docAlpha system.

To learn more about solutions or for help integrating ERP, ECM and other business systems, explore our website or contact us today.