Your Small Business And ERP: Are They The Right Fit?
ERP can certainly be a costly investment, and any decision to implement should naturally not be undertaken lightly. This rings especially true for the small and midsize business, who until recently have been shut out of the ERP market due to exorbitant costs and complex systems that require a huge investment into middleware. However, as enterprise software vendors realize the value available in the small business market, ERP software is now available for, and more than ever, specifically targeted towards small-to-midsize businesses. From cloud-hosted options to industry specific modules, small business and ERP is becoming a more feasible and cost-effective decisions for executives to make.
So, how do you know when or if combining your small business and ERP software is a smart move to make? We hope to help you learn more about upcoming enterprise solutions aimed at small businesses and how they can help consolidate and facilitate your business processes without crippling your bottom line. Read on for the key considerations your organization needs to make before deciding if your small business and ERP software are the right fit.
Process Management Is Becoming a Hassle
You have diversifying departments, more employees than ever, and a constantly evolving way of getting key tasks done in your business. When this kind of growth and change continues unchecked, departments can grow into uncommunicative silos and many business processes can then become redundant and burdensome. An ERP implementation is a great reason to de-clutter your business processes and do a thorough modeling of every task, employee and workflow within your business. You can locate avenues of miscommunication and overlapping processes that slow down tasks within your business and increase waste, and that enterprise software can help you eliminate them.
If you are having trouble getting a hold on your business processes, an ERP implementation can often kill two birds with one stone. You not only have the incentive to fine tune your processes, you will also install a system that can manage those processes for a long time to come.
Data Errors Are Increasing
Those Excel spreadsheets might have done you just fine at the beginning of your business’ journey, but your accounting and finance department are finding that they just can’t deal with business growth feasibly, and errors in spreadsheet coding and data entry are beginning to accumulate.
If this situation sounds relatively familiar, it’s probably high time start linking up your small business and ERP software. Every small business reaches a tipping point when it comes to their accounting software, and ERP packages can often contain more powerful financial capability than their introductory software systems. If data and accounting integrity is being threatened at your small business, it’s time to consider ERP.
ERP Cost has traditionally been one of the most restrictive factors holding small businesses back from ERP implementation. Because the investment in ERP might be a significant portion of your current bottom line, implementation failure can have a much more momentous impact on your business finances. However, as ERP software becomes more mainstream in the world of SMBs, prices are coming down to meet the market. This includes an options of mix-and-match modules and suites that can be tailored and pared down as necessary to fit your business process. Combining a new cost effective ERP package with a careful risk planning initiative and implementation strategy, and you can rest easy that integrating your small business and ERP will be a smart investment.
Work in the Cloud
As a factor stemming out from the cost of ERP, many small businesses in the past have been hesitant to implement the enterprise software because on-site installations require expensive hardware and server space. The emergence of cloud-based ERP has transformed this restriction considerably. Now, small businesses can host their ERP off site through a cloud provider, who then provides all the server space necessary maintenance and upgrade support on a monthly licensing basis. This can end up being a much more reasonable option for the money-conscious project team, and a lower total cost of ownership (TCO) over time for a business who wants all the advantages of a robust ERP system without the robust set of hardware that usually accompanies it. This is not to mention all of the other non-monetary benefits that companies can gain from locating your ERP in the cloud—which you can read all about here.
Employee count may be a misleading statistic to look at when considering the necessity of ERP for your business; you may have reached a suggested threshold for the number of employees, but how are those employees distributed departmentally? Do the majority of workers operate in front facing services? If so, it may be a better idea to implement CRM first and then integrate ERP as you need it later on. It’s also crucial that a small business has the IT resources needed to sustain the proposed software. ERP systems require significant employee time when it comes to training and maintenance of an ERP system, and you need to be sure that you have the right amount of people and resources that you can commit to the long-term implementation.
If you only have one person working on your IT operations, it would be wise to either bulk up your tech department or look for outside help if you’re thinking about ERP implementation. This tip may be less pertinent if you are going to spring for software in the cloud, as we have previously mentioned that SaaS ERP vendors usually will provide routine maintenance and support as part of their monthly licensing fee. Still, manpower is a serious consideration that needs to be made before you make any decision concerning your small business and ERP software.
The big Fortune 500 companies pay out vast sums of money to ERP giants like SAP to implement sprawling, global and complex systems. This kind of undertaking is simply not feasible to emerging small and midsize businesses and has until recently remained a feature strictly for big business.
However, as enterprise software has become an emerging trend, has diversified into an ever more customizable range of options and has moved into the cloud, ERP has entered into the small business conversation. They are now more options than ever for a growing business looking to streamline their processes and cut back on operational waste. From allowing companies to select best-of-breed packages that can maximize cost efficiency and functionality to cloud-hosted instances that take care of all upgrade and maintenance issues for their clients, it is now totally possible to combine small business and ERP comfortably!
If you’re a small business looking to implement ERP and don’t know where to start on how to find the best system for your specific needs, contact an expert at Datix today. We have over 18 years helping clients of all shapes and sizes with their ERP implementations, and we can transfer some of our expertise over to you!