Huge inventory levels may well be result of bad tools to manage inventory properly. Or they may come from people being irresponsible about ordering only what's necessary. It may come from poor planning tools. Or from people avoiding planning, or not planning at all.There are many instances when a company's profitability may be low due to huge administrative overhead or due to shot of personnel to take care of unnecessary costs. Your company can become unprofitable in sales, because somebody is doing favors to certain "big" and "important" customers, and nobody knows or nobody cares. The people who are associated with these malpractices will keep all the transactions under the carpet.In the above scenario, an ERP system could make a big difference. That means the ERP will not miraculously make those customers profitable for you, but being a tool, it could expose them and pinpoint the reason for low profitability.It is just an example how an ERP system could be used as an effective tool to curtail malpractices in an organization which will ultimately solve many of your business problems.
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