Turn Odoo ERP system into one source of truth for data

In the fast-paced world of modern business, data has become the lifeblood of any business. As companies grow and evolve, they face the challenge of managing an increasing volume of data from various sources. However, many businesses currently depend on a variety of software solutions. These systems often operate independently, lacking efficient communication and integration capabilities. The consequence of such disjointed systems is a data decentralisation that leads to duplication, data inconsistency, and inaccuracies. 

That’s where Odoo ERP comes into play. Businesses aspire to transform Odoo ERP into a robust centralised system, yet they may lack about Odoo capabilities and where to begin.

This chapter aims to delve deeper into how businesses function in terms of data. It will also elucidate Odoo's readiness for data centralisation, and how to effectively manage data centrally within the Odoo ERP system.

This chapter will consist of 4 crucial points below:

• What is one source of truth for data?
• What kinds of master data need to be centralised?
• How to manage data centrally in the Odoo ERP system

What is one source of truth for data?

In order for businesses to operate smoothly and efficiently, they must effectively manage multiple data sources from various operational areas such as manufacturing, inventory, purchasing, accounting, sales, and customer services. To achieve this seamless data flow, it is essential for businesses to connect and integrate numerous systems and data sources, ranging from eCommerce platforms, Point of Sales (POS), and inventory management to sales, marketing, and customer relationship management (CRM) systems.

The integration of these diverse components is crucial to establish a reliable source of truth for data. A fully integrated and centralised solution will connect all aspects of the business's data and its corresponding elements. With centralised data management capabilities, businesses can update critical information, benefiting both internal operations and external stakeholders such as:

• Data consistency and accuracy: Centralising data ensures that information across the business remains consistent, accurate, and up-to-date. This enables employees to make informed decisions based on reliable data, leading to improved operational efficiency
• Enhanced collaboration and communication: With one source of truth, departments, and teams can access and share data seamlessly, fostering collaboration and communication across the business. This breaks down silos and promotes a cohesive work environment
• Improved decision-making: When data is scattered across disparate systems, it becomes difficult to derive meaningful insights. Centralising data allows for comprehensive analysis, empowering management to make informed decisions based on a holistic view of the business data.

This chapter will focus on how to leverage Odoo and its vibrant community to develop a centralised data management system, ensuring up-to-date and accessible information for the business and its customers. 

What kinds of master data need to be centralised?

In order to achieve a high level of productivity and efficiency, it is essential to consolidate all the primary data used in your day-to-day operations, commonly referred to as master data, into a centralised system. However, which crucial data should be centralised to smooth out your business operations? Let's explore the specific data requirements for each business process within a typical supply chain. (image)

Master data, which includes information about customers, products, suppliers, and employees, form the foundation of a business's operations. Centralising this critical data ensures its integrity and usability throughout the business. Master data includes:

Customer Management

Maintaining consistency in customer management is crucial. This entails centralising customer data and their information and synchronising them across related departments. The result is that salespersons can quickly access customer information, enabling them to provide better customer service. This also helps sales teams reduce the time spent on searching and be more proactive in their approach. Besides, centralising customer information can give businesses valuable insights into the latest customer behaviors. 

To achieve this, it is imperative to prioritise the following data and ensure their availability and accurate tracking within a single system:

• Customer information: Contact details, preferences, and other information
• Purchasing information: Purchased products, historical transactions, and discounts, 

Centralising customer data is essential to improve their experience and meet more increasing expectations. You can leverage these data to deliver personalised marketing campaigns, and streamline the purchasing process.

Manufacturing

In manufacturing operations, master data plays a crucial role in streamlining operations, ensuring accuracy, and enabling efficient decision-making. To smooth out your manufacturing process, types of master data need to be organsied in a unified system:

• Product data: Manufactured goods, including their names, descriptions, specifications, and variants. It includes essential attributes such as dimensions, weight, materials used, and technical specifications.
• Bill of materials (BOM): Components, sub-assemblies, and raw materials required to manufacture a finished product. It includes information about the quantities, part numbers, and relationships between the items. 
• Routing data: Work centers, machines, tools, and resources needed at each stage of the manufacturing process. 
• Supplier data: Contact details, terms of agreement, pricing, and delivery schedules.
• Equipment and asset data: Machinery, equipment, and assets used. It includes details such as maintenance schedules, operational parameters, location, and performance history. 
• Quality data: Standards, specifications, and guidelines for ensuring product quality and compliance. It includes information about quality control parameters, inspection procedures, testing protocols, and quality certifications. 

By effectively managing and leveraging master data in manufacturing, you can enhance operational efficiency, improve product quality, reduce costs, and respond swiftly to changing market demands.

Inventory and Warehouse Management

In inventory and warehouse management, master data serves as the backbone for efficient operations, accurate tracking, and optimal utilisation of resources. The centralised inventory management system enables businesses to improve customer experience by providing customers with real-time product availability and delivery times. 

Internally, the system streamlines fulfillment processes, mitigates the risk of overselling and eliminates the need for laborious manual data entry.

Various types of master data are essential in this operation to ensure effective inventory control and streamline warehouse management processes, including:

• Product information: Product details with attributes such as SKU, descriptions, dimensions, weights, pricing, and supplier details.
• Stock levels and locations: Quantity of each item available, its storage bin or location, and any stock movements or transfers.
• Reorder points: Minimum quantity to reorder. 
• Warehouses/ Bin management: Storage bins, racks, and shelves with information such as bin numbers, capacities, and specific storage requirements.
• Serial/ lot numbers: Serial numbers and lot numbers. 

By effectively managing these types of master data in inventory and warehouse management, you can optimise inventory levels, improve order accuracy, minimise stockouts, and enhance overall operational efficiency.

Purchasing Management

Managing supplier data centrally enables businesses to maintain up-to-date records of suppliers, track orders, and manage contracts effectively. This facilitates smoother procurement processes and helps build stronger supplier relationships.

To achieve this, businesses need to focus on the key data elements within this flow. Including the following:

• Supplier information: Contact details, payment terms, and performance metrics.
• Materials: Items or materials that a company procures with information such as item codes, descriptions, specifications, units of measure, pricing, and relevant quality attributes. 
• Pricing and contract: Pricing information, discounts, delivery terms, payment terms, contract terms, and conditions.
• Purchase orders: Items purchased, quantity, unit price, delivery dates, and associated supplier.
• Supplier performance: On-time delivery, quality of goods or services, responsiveness, and compliance.
• Procurement analytics: Spend analysis, supplier performance metrics, cost savings, and procurement cycle times. 

With a centralised data, you can optimize procurement processes, improve supplier relationships, achieve cost savings, and ensure the timely availability of goods and services.

Sales Activities Management

Sales activities play a vital role in business growth. Sales data serves as a foundation for effective sales management, customer engagement, and revenue generation. To streamline sales activities, various types of sales data need to be stored to ensure accurate and targeted sales efforts. The most key data includes:

• Customer data: Names, contact details, demographics, purchase history, preferences, and communication preferences. 
• Product data: Products or services offered with attributes such as product descriptions, specifications, pricing, features, benefits, and available variants. 
• Pricing and discount data: Pricing, discounts, promotions, and special offers.
• Transaction data: Orders, shipments, returns.
• Sales performance data: Sales targets, actual sales figures, conversion rates, and revenue generated. 

With sales data, you can smooth out sales processes, enhance customer relationships, and drive revenue growth. 

Accounting and Finances

Accounting and finance are core parts of business operations, so data from these operations play a crucial role in ensuring accurate financial reporting, and profitability for the business. 

The following essential data o maintain accurate and reliable financial records. 

• Customer: Invoices, credit notes, payments.
• Vendor: Bills, refunds, receipts, payments, and employees' expenses.
• Accounting: Budgets, revenue, expenses, profit and loss, cash flows, tax, audits
• Currency exchange rates: Exchange rates used to convert transactions 

These types of data in accounting and finance enable you to maintain accurate financial records, improve financial decision-making, ensure compliance with accounting standards, and enhance overall financial management. 

Human Resources Data

Centralised employee data simplifies human resources management, including employee profiles, attendance records, performance evaluations, and payroll. This leads to streamlined HR processes and ensures accurate payroll calculations.

In human resource management, types following data are essential to ensure accurate and comprehensive HR processes. 

• Employee data: Personal details and employment-related information such as job titles, positions, departments, reporting lines, and employment contracts. 
• Organizational structure data: Departments, teams, reporting relationships, and managerial roles. 
• Skills and competency data: Skills, qualifications, certifications, and competencies possessed by employees. 
• Compensation and benefits data: Salaries, allowances, bonuses, incentives, leave entitlements. 
• Time and attendance data: Working hours, leaves, absences, and attendance patterns.
• Performance and appraisal data: Goals, objectives, performance ratings, and appraisal feedback. 

Streamlining HR processes forms the foundation for effective HR decision-making, employee engagement, and overall organizational success.

How to manage data centrally in the Odoo ERP system

With the power of an ERP system like Odoo, businesses can centralise their data, ensuring consistency, accuracy, and accessibility throughout their operations. In this section, we will explore how to manage data centrally in the Odoo ERP system, empowering businesses to streamline their processes, make informed decisions, and drive growth.

Prepare your data requirements 

Before embarking on data centralisation, it is essential to understand your business's unique data requirements. Identify the types of data your business generates and utilises, such as customer information, product details, inventory data, and financial records. Determine the specific fields, attributes, and relationships that need to be captured for each data category. This understanding will lay the foundation for designing a centralised data structure within Odoo.

Design custom data models

Odoo's flexible architecture allows businesses to design custom data models tailored to their specific needs. Leverage the Odoo or consult with an Odoo implementation partner to create customised data models that align with your business's processes. Define fields, relationships, and data validation rules to ensure data integrity and accuracy. Consider factors such as data dependencies, unique identifiers, and cross-module integration to optimise your central data structure.

Import and migrate data 

To centralise existing data, you need to import and migrate it into the Odoo ERP system. Utilise Odoo's data import tools to efficiently transfer data from various sources, such as spreadsheets or legacy systems. Cleanse and format the data to match the defined data models and perform thorough validation to ensure data quality. Collaborate with your team to ensure a smooth and accurate data migration process.

Integrate data across modules

One of the key strengths of Odoo is its seamless integration between different modules. Ensure that your central data structure is integrated across relevant modules, such as CRM, sales, inventory, and accounting. This integration enables data consistency and real-time updates throughout the system. 

For example, when a customer places an order, the information flows seamlessly from the sales module to the inventory and accounting modules, eliminating manual data entry and reducing errors.

Implement data access controls

Data security is paramount when managing data centrally. Odoo provides robust access control features, allowing you to define user roles and permissions. Determine who can view, edit, and delete data based on their roles within the business. Implement stringent security measures, such as two-factor authentication and data encryption, to safeguard sensitive information.

Regularly maintain and update data 

Data management is an ongoing process. Regularly review and maintain your central data repository to ensure data accuracy and relevance. Perform data validation checks, update outdated information, and archive or delete redundant data. Establish data governance policies and procedures to maintain data hygiene and enforce data management best practices.

Centralising data within the Odoo ERP system empowers businesses to optimise their operations, enhance decision-making, and improve overall efficiency. By understanding your data requirements, designing custom data models, importing and migrating data, integrating across modules, implementing access controls, and maintaining data regularly, you can establish a robust central data management system within Odoo. 

To sum up

In this chapter, we dive deeper into the critical concept of data centralisation, which forms the foundation of an efficient omnichannel system. Additionally, we explore how data centralisation occurs within the Odoo platform.

Understanding the capabilities of Odoo is essential to unlock its full potential and leveraging its core functionalities effectively. By acknowledging what Odoo excels in, you can make informed decisions about utilising the platform's features optimally. Now, it is time for you to define key performance indicators (KPIs) to measure the success of Odoo ERP implementation. Let’s explore it in the next chapter.