The Core Components of ERP: A Higher Education Perspective

An enterprise resource planning (ERP) system for higher education provides the core tech to manage institutional services, including faculty, staff, and student needs. Dedicated ERP software designed for higher ed can automate tasks, eliminate manual work, and bring together resources across campuses into a centralized platform. By streamlining the information flow between departments and financial, operations, and academic units, ERP software becomes the central hub for management.

While many schools have implemented ERP systems, many of these systems are outdated and do not benefit from the power of today’s emerging technology. Only 19% of institutions have completed an ERP implementation within the past decade. While another 17% are in the process of implementing a new ERP system, the rest are relying on old legacy software that does not support the full range of tasks needed for the efficient operation of a college or university.

Why are academic institutions implementing or updating their ERP systems? An Educause study of nearly 370 higher ed locations highlighted the top reasons for replacing software:

  • Not meeting functional needs
  • Too difficult to support/maintain
  • Desire to move to cloud infrastructure
  • Needed better alignment with strategic mission
  • Too many shadow systems and data silos
  • Not keeping up with growth and changes
  • Staff dissatisfaction
  • Limitations in integration and scalability

While your reasons may vary, if you have any of these concerns, it may be time to update your tech stack to a modern ERP platform.

What Are the Five Components of ERP?

The 5 major components of ERP systems in business are:

  1. Finance and accounting: general ledger, AR, AP, financial planning
  2. HR and payroll: recruitment, training, payroll, benefits
  3. Inventory management: production, planning, materials
  4. Supply chain management: procurement, distribution, logistics
  5. CRM and sales: marketing automation, sales-force automation, customer service

In higher education, however, ERP systems encompass a wide variety of capabilities to manage college and university resources. The most common components include:

  • Academic analytics: Generates reports and insights on demand trends and performance.
  • Admissions management: Streamlines inquiry, application, and registration tracking.
  • Alumni management: Maintains alumni databases, events registration, and communications.
  • Attendance management: Integrates class schedules, participation tracking, and student contact.
  • Certificate/document management: Issues official credentials and stores documents.
  • Curriculum/course management: Establishes curriculum structure, credits, sections, and hours.
  • Faculty management: Handles faculty hiring, profiles, scheduling, and workloads.
  • Inventory management: Tracks asset inventory like books, computers, and lab equipment.
  • Student information/records system: Interconnects biographic and academic student data across modules.
  • Student portal: Allows student self-service for enrollment, registration, and payments.
  • Tuition/fee management: Enables configurable billing plans, payments, and receipts.

The Benefits of Higher Education ERP

There are several key benefits to implementing or upgrading your systems to a modern ERP system.

Improved Operational Efficiency

An ERP system connects data, processes, and reporting across previously disparate systems. Automation, workflows. and standards improve process efficiency. For example, admissions staff process applications faster by accessing centralized student data. Procurement teams can streamline department purchasing by implementing a digital workflow and approval process, leveraging eProcurement.

Better Data Insights

An ERP system centralizes data in a single source of truth to ensure that data is in sync, accurate, and up-to-date. Administrators can track KPIs like enrollment funnel conversion rates to guide strategic decisions.

An ERP system breaks up data silos to connect information across campuses and departments—registrar, admissions, finance, HR, and more.

Enhanced Student Experience

Student self-service access via portals allows tasks like registering for classes or making payments. Alerts and notifications also improve communication and transparency.

Data Security and Compliance

Modern ERP systems have robust access controls, permissions, and auditing to meet privacy regulations like FERPA compliance for student data. Built-in validations improve data integrity across the system and adhere to cybersecurity best practices.

More Effective Communication

Common ERP data and unified processes improve communication between departments, staff, students, and parents. An ERP platform enables seamless collaboration and information sharing among key higher education stakeholders

Cost Savings

Efficiencies, workflow automation, and paper reduction generate significant cost savings over legacy manual processes. Cloud deployment also reduces infrastructure expenses compared to on-premises software.

Steps to Implementing or Updating ERP in Higher Education

Colleges and universities integrating and upgrading the ERP systems need to follow a formal process to ensure an effective transition. Here are the key steps.

Step One: Evaluate Needs

Conduct assessments to identify gaps in current ERP capabilities against objectives and pain points. Uncover less visible deficiencies like missing analytics and workflow bottlenecks.

Step Two: Check Readiness

Gauge organizational readiness through surveys and focus groups. Highlight change management and training requirements. Incorporate user input into design to help seed buy-in and account for potential impediments to implementation.

You will want to talk to a broad cross-section of stakeholders as different functional units will use ERP components differently. For example, science departments and food services have specialized inventory features, compared to admin units.

Step Three: Budget Effectively, Plan Carefully

Account for all costs including licensing, project management, data migration, consultants, infrastructure, training, and support.

ERP failures generally happen because the system design did not account for all expenses and challenges. While studies show that 81% of ERP installations meet ROI expectations within a year or more after go-live dates, the remaining 19% failed to do so, leading to costly mistakes.

Step Four: Update Processes and Workflow

You do not want to replicate outdated workflow and processes in a new system. Leverage your digital transformation as an opportunity to fix problems. Standardize handling procedures based on best practices and technology, enabling automation wherever possible.

Step Five: Prioritize Cloud

Remote and hybrid work schedules have become more common. There are plenty of examples. The Pennsylvania State System of Higher Education Support allows its 160 employees in the Chancellor’s office to work remotely. About half of the 300 workers in the IT department at the University of Illinois Urbana-Champaign are now remote and nearly 100 work hybrid schedules. At Southern New Hampshire University, 88% of all employees are fully or partially remote.

Remote access and flexible scaling through cloud-based ERP systems are crucial to accommodate mobility needs.

Step Six: Focus on Change Management

Making substantive changes to systems and workflow is often more about the people than the technology. An ERP integration or upgrade significantly impacts users and disrupts legacy workflows. Do not underestimate the importance of effective change management to get teams to adopt and embrace new capabilities.

User training plays an important role in change management in such digital transformations. A Forrester Business and Technology Services survey ranked change resistance as one of the top five most frequent challenges in executing technology plans.

Step Seven: Selection and Procurement

Working with suppliers, you can compare features, functions, and pricing to find the best-fit solutions for your college or university.

E&I Cooperative Services can help streamline the procurement process. As the only non-profit, member-owned purchasing cooperative that focuses solely on the education sector, E&I Cooperative Services has competitively solicited cooperative purchasing agreements tailored to the needs of higher education. E&I Cooperative Services aggregates volume buying across its member organizations to negotiate better pricing and terms than institutions can achieve on their own.

Step Eight: Launch and Measure

Once you are ready to go live, it’s a good idea to run systems in parallel or consider phasing in components to ensure functionality requirements work as intended. As you roll-out systems, encourage open feedback from users to quickly resolve concerns and continually optimize based on user input.

Introduction to the ERP Procurement Process Flow in Higher Education

Managing procurement and inventory for higher education institutions requires specialized capabilities. ERP systems tailored for colleges and universities encompass modules and integrations to enable the right controls, flexibility, and analytics needed to run academic operations efficiently. There’s much to learn, which is why we’re providing this introduction to the ERP procurement process flow in higher education.

High Ed ERP Supply Chain Management

Higher education ERP supply chain management in ERP systems connects procurement requests from end-users across decentralized departments and locations to inventory controls, purchasing, receiving, accounts payable, and reporting.

In a typical workflow, orders are routed through approval chains while enforcing policies for spend authorization. Dashboards give procurement leaders real-time visibility into budgets and spending to monitor and assess categories of spend.

Higher Education Procurement ERP Requirements

Higher education institutions have unique procurement requirements compared to corporate environments. Considerations span managing inventory for specialized lab equipment, books and course materials, IT hardware, facilities maintenance supplies, food services, and more.

There are several types of inventory management for higher education, along with procurement systems. A few of the more common ones include:

  • Learning management systems (LMS): Track course materials like textbooks and digital assets
  • Library management: Catalog and circulate physical and digital holdings
  • Lab and equipment tracking software: Manage inventory of specialized lab apparatus
  • IT asset management software: Lifecycle management of computers, printers, phones, etc.
  • ERP procurement modules: Requisitions, purchase orders, receiving, invoicing

Procurement teams must account for decentralized decision-making across academic departments and administrative units while maintaining compliance with regulations. This requires an ERP system that enables integration with eProcurement systems, allowing departments to make inventory purchasing from approved suppliers with online catalogs.

ERP Inventory Management for Higher Education

For inventory and asset management, ERP inventory management for higher education systems have configurable categories and attributes for tracking. For example, lab inventory can record serial numbers, certification expiration dates, hazardous materials details, and maintenance records. Barcoding and RFID integration support inventory auditing and chain of custody tracking.

Inventory tracking systems are capable of monitoring inventory levels, setting optimal reorder points, and connecting with external systems to monitor pricing trends to recommend potential savings.

Types of Higher Education Procurement Methods

Examples of procurement systems in higher education tied to finance modules enable different types and methods of purchasing such as:

  • Individual department purchases: Delegated buys under certain thresholds
  • Group purchasing organizations: Leverage aggregate spend for discounted pricing
  • Cooperative contracts: Streamline buys through existing competitively bid agreements
  • Formal RFP process: May be required for high-value software and services contracts
  • Purchasing cards: Enable decentralized, controlled spend up to preset limits

E&I Cooperative Services is the only nationwide purchasing cooperative dedicated to the education sector. With more than 100 ready-to-use contracts, you can find the ERP system, tech tools, system integrators, and consulting help you need for a successful ERP installation, upgrade, or digital transition.

By aggregating spend across 6,000 member institutions, E&I Cooperative Services creates significant cost efficiencies when negotiating contracts, passing along the savings to members. There is no cost to join E&I Cooperative Services and no obligation or minimum purchasing requirements. Members can review contracts and pricing and choose about whether to opt in.

As a member-owned organization, E&I Cooperative Services also shares proceeds in the form of equity and patronage rebates. For example, E&I Cooperative Services returned $6.32 million in patronage to members in 2023.

Frequently Asked Questions—FAQs

What are the 3 common types of ERPs?

The three most common types of ERP systems are:

  1. On-premise ERP: Software is installed on servers on campus. This allows for more customization and control of hardware but requires more in-house IT resources.
  2. Cloud ERP: Software is hosted on supplier servers and accessed via the internet. This is easier to set up and scale but relies on supplier resources.
  3. Hybrid ERP: Combination of on-premise and cloud ERP. Critical functions are on-premise while others are cloud-based.

What is the procurement process in ERP?

The procurement process in higher education ERP standardizes and manages the purchasing of goods and services to support university operations, centralizing key data and applying automation to enforce approvals, provide transparency, and optimize spending. This ERP integration enables real-time visibility and control over procurement spending across the institution.

Can ERP systems automate operations?

One big advantage of ERP systems is the ability to automate many functions, relieving administrative staff of a significant number of manual tasks. However, it still requires human intervention to configure rules, and monitoring to ensure outputs match institutional policies and requirements.

Systems typically come with a large variety of pre-built tools and allow for custom integrations, add-ons, and third-party integrations to expand automation.

Review available contracts at E&I Cooperative Services and see all the benefits of becoming a member. You can also connect with the dedicated E&I procurement specialist for your organization.


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