In this glossary we will discuss the differences between an IWMS and ERP, common challenges faced when integrating your IWMS with an ERP system, and how to analyse the ROI of this integration. This guide also provides clear and concise definitions of key terms and solutions.
Table of Contents
- The main benefits of integrating IWMS with ERP
- The basics of ERP, real estate, and facility management
- How to measure success of integrated ERP and IWMS?
- Customer story: Shell Real Estate uses Planon
- Frequently Asked Questions (FAQs)
The main benefits of integrating IWMS with ERP
Integrating IWMS with ERP can help businesses improve data quality, reduce errors, avoid duplication, increase visibility, improve resource allocation, optimise efficiency, and save costs. For example, by integrating IWMS with ERP, businesses can ensure that their lease data is consistent and correct across systems, automate invoice processing and payment, track and monitor capital projects and budgets, and generate comprehensive reports and dashboards.
In our experience, the main benefits to an organisation of integrating ERP software with real estate and facility management software are:
1. Improved data quality and consistency
By synchronising data across different systems, such as financial, HR, asset, and space management, organisations can avoid data duplication, errors, and inconsistencies, and ensure that they have one source of truth for their core operations and real estate portfolio.
2. Increased visibility and control
By having access to real-time and comprehensive information on their real estate and facility performance, organisations can make better decisions, reduce costs and risk, and align their real estate strategies with their business objectives and stakeholder expectations.
3. Optimised efficiency and productivity
By automating and streamlining workflows and processes across different domains, such as lease management, maintenance management, service delivery, and project management, organisations can save time, resources, and money, and improve the quality and reliability of their services and outcomes.
4. Improved user experience and satisfaction
By integrating ERP with real estate and facility management software, organisations can provide a seamless and user-friendly interface for their employees, customers, and partners, and enable them to easily access, request, and track the services and resources they need.
The basics of ERP, real estate, and facility management
Enterprise Resource Planning (ERP) is a system of integrated software applications that helps organisations manage their core business processes, such as accounting, finance, human resources, inventory, procurement, sales, and production. As ERP software supports multiple departments, it will have multiple different users with distinct roles. Responsibility for planning, maintaining, and implementing changes to the ERP usually rests with the IT department.
The following modules are examples of the components found in a typical ERP system:
- A finance module
- Supply Chain Management (SCM)
- A manufacturing module (to support the production, quality, inventory, and distribution functions of manufacturing organisations)
- Human Resource Management (HRM)
- Customer Relationship Management (CRM)
- A procurement module (to automate buying, invoicing, and vendor management functions)
Real estate and facility management (RE/FM) is a system of processes, tools, and strategies that helps organisations improve the use and performance of their buildings and land. It aims to align the physical operating environment of an organisation with its goals, by maximising the value, functionality, and sustainability of the assets. It also seeks to minimise the costs, risks, and environmental impact.
An Integrated Workplace Management System (IWMS) is a software application that supports real estate and facility management. Organisations commonly integrate IWMS with ERP software to improve data quality, visibility, and decision making.
The typical users of an IWMS include directors of real estate, facilities managers, workplace managers, space planners, building maintenance technicians, and sustainability professionals.
The following modules are examples of components found in a typical IWMS:
Real estate management simplifies commercial real estate management or corporate real estate management.
Space and workplace management supports the design and implementation of workplace strategies.
Facility services management enables a facility manager to plan, schedule, and monitor the execution of services.
Asset & Maintenance Management assists in managing and improving the maintenance activities of physical assets.
Energy and sustainability management helps measure and improve the energy consumption and environmental impact of facilities.
Starting your ERP and IWMS integration journey
A modern ERP such as SAP S/4HANA® Cloud Public Edition, together with an IWMS such as Planon IWMS enables any business to run its core operations more efficiently.
Integrating IWMS and ERP systems can simplify workflows, boost productivity, and ensure data accuracy across your business units.
If you are curious about how to integrate your IWMS and ERP systems, get in touch with us and request a product demo now.
How to measure success of integrated ERP and IWMS?
By tracking Key Performance Indicators (KPIs), businesses can optimise resource allocation, enhance service quality, and measure return on investment (ROI) when integrating ERP and IWMS systems. Here are commonly used KPIs for real estate management:
- Occupancy rate is the percentage of leased or occupied space in a building or property.
- Tenant turnover is the rate at which tenants vacate or renew their leases. The renewal rate is the percentage of tenants who renew their leases at the end of the lease term.
- Maintenance cost is the amount of money spent on maintaining and repairing the buildings and facilities.
- Capital expenditure is the amount of money invested in acquiring, upgrading, or improving the buildings and facilities.
- Environmental impact is the effect of the buildings and facilities on the environment. This may include energy consumption, carbon emissions, waste generation, or water usage.
- User satisfaction is the level of satisfaction and engagement of the users or occupants of the buildings and facilities.
How to measure the ROI of ERP and IWMS integration?
To measure the ROI of ERP and IWMS integration, you can compare the costs and benefits of the integrated system versus the separate systems. Assuming a software as a service subscription, then the costs will include the implementation project, plus an annual recurring subscription cost.
The ROI is calculated by dividing the net benefits (benefits minus costs) by the total costs and multiplying by 100 to get a percentage. A positive ROI shows that the integration has paid off, while a negative ROI would show that the integration does not generate enough value to justify the costs.
ROI Calculation Formula
- Costs = Implementation + Recurring subscription
- Benefits = Value of improved outcomes - Costs of separate systems
- Net benefits = Benefits - Costs
- ROI = (Net benefits / Costs) x 100%
Customer story: Shell Real Estate uses Planon
Shell Real Estate is the centralised function within Shell that controls its real estate assets. Its goal is to increase operational and cost efficiencies, whilst finding opportunities to reduce underutilised assets.
Shell Real Estate seamlessly integrates its Planon IWMS with its SAP® ERP, for accurate HR and vendor data and swift vendor invoice processing.
Frequently Asked Questions (FAQs)
For example, businesses need to ensure they comply with regulations, that their systems are compatible and interoperable, and that their users are trained and supported.
The first step is to assess the current state of the real estate and facility management processes and systems, and find the gaps that need to be addressed.
The second step is to plan how the integration will be conducted, and what methods and tools will be used. If you already have an IWMS in place, you’ll need to analyse whether it can meet the requirements and objectives of the integration project. We’ve collated a full guide of the 7 steps towards a smooth implementation when integrating an IWMS with your ERP.
By offering a productised integration between Planon IWMS and SAP S/4HANA®, Planon Real Estate Management for SAP S/4HANA® overcomes these challenges and removes the need for you to make difficult choices. To learn more, read our 6 FAQs on smart, sustainable real estate with SAP and Planon.
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