ERP - it's no longer used only in large corporate terminology
MANY local SMEs, use multiple processes and software packages, to run their companies. Inefficiencies and mistakes across every aspect of their business come into play, when they don't use a single system, to manage it all. That's when an Enterprise Resource Planning (ERP) platform comes into play.
But when a business starts a conversation around using an ERP solution, partners and fellow directors, not normally at the forefront of the company's IT, understandably, can feel a little edgy at first.
Questions around price, size and accessibility start to arise because many SMEs think ERP is just for larger corporates with complex operations. But it really isn't – in fact, a properly implemented ERP solution, often makes the most sense for smaller organisations, who are looking to streamline their operations in order to grow.
Of course, I don't disagree, there are solutions out there tailored towards large enterprises. However, many of the software giants have realised the financial benefit of providing much of the functionality, they have already developed, into a reduced format for SMEs.
The ERP landscape has now diversified enough, to accommodate businesses of all sizes from start-ups and micro businesses. After all, when you sit down and analyse many of our smaller businesses, they still carry out many of the operations that their larger counterparts do, and require much of the same or similar functionality. Many smaller Irish companies are now looking at ERP systems, as a vital part of their business growth strategy.
One of the first questions that is raised is always the cost, and many businesses, while associating ERP with large enterprises, in turn, often assume that it's prohibitively expensive for a company of their size. However, most ERP platforms are scalable, and able to be tailored to the specific needs of a business, making them much more accessible than many business people may think.
Consider, for example, the cost of a lost sale or customer, due to inefficient business processes. Also, consider how much it costs to hire extra staff needed to perform everyday business processes that can otherwise be automated or streamlined by an effective ERP platform that suits the size of the company. In fact, the main advantage of ERP, is that it saves money by giving your business a sustainable path of growth. And with the “big solution” providers targeting the SME market, as a growth area for their sales, it's well worth investigating further with an open mind.
Although an ERP implementation is still a major project, the amount of time it takes depends on various factors. These include the size of your business, your specific goals and the degree of customisation needed and the platform it's to be built on.
You also need a reliable IT partner on your side, who fully understands the industry sector you operate in, the detailed needs of your business, and the resources you can provide them, so as to accelerate the planning and implementation of a new solution, in a manageable time-frame.
Another common assumption is that ERP platforms are prohibitively expensive and difficult to customise. However, not all ERP systems are designed that way and many, to a greater or lesser degree, integrate with other solutions that are commonly used by businesses. This allows SMEs to add functionality to their IT environment, rather than change it completely. Many ERPs solutions have opened up the ability to easily build custom apps, which provides increased mobility to their key staff.
There are many more reasons for our local SMEs to investigate ERP solutions, like the financial benefits of reducing multiple annual licensing costs, saving large corporates thousands of pounds every year. Perhaps now's the time to look a little closer at the term ERP for the SME.