What small business requirements can an ERP meet?
Before we get into small business requirements-setting, perhaps it might be best to consider the goals of an ERP in a small enterprise environment.
There are typically three core values involved:
Small businesses have limited resources at their disposal, so it’s essential to eliminate sources of inefficiency like data silos.
Rather than having disjointed departments dealing with challenges associated with the development of stove-piped information, data can be centralized, and easily accessed, shared, and migrated. This reduces the potential for human error, associated costs, and increases efficiency.
Enhanced decision-making ability
The ability to adapt quickly to market changes, and to make decisions without having to go through several layers of management, can provide small businesses with an advantage in an arena that all-too-often favors larger firms.
Leveraging common data, provided by a central ERP platform, can be used across sales, production, inventory management, and financial operations to inform a company’s next move. Altogether these values allow small firms to make vital decisions quickly and accurately, while reducing operational waste.
The use of common data-sets tend to streamline overall operational processes, while also allowing staff resources to refocus on direct management and the expansion of business volume. Essentially, it gives your staff more time to do their job - and in a fast-paced, pushed-for-time small business environment that can only be a good thing.
Also, because ERP is largely regimented within its operational framework, this characteristic tends to positively alter the nature of businesses in general, leading to better efficiency throughout.
When you need to make a move
While there is no sure way to know when it’s time to consider an ERP selection, there are typically some general characteristics that apply. These include:
- If the company’s business intelligence has become spotty, and what ‘information’ is of dubious value, it’s usually a good time to look at an ERP option.
- If the company is challenged by growth management, particularly in the case of a sudden expansion in sales volume, it’s usually a good time to look at an ERP option.
- If the company is no longer able to manage its transactions accurately, or that accuracy is challenged by the time necessary to resolve your accounting reports, it’s usually a good time to look at an ERP option.
- If the company finds itself dealing with glaring inaccuracies in terms of static and dynamic inventory levels, it’s usually a good time to look at an ERP option.
- If the company’s sales forecasts are largely based on the WAG method (wild a** guess), it’s usually a good time to look at an ERP option.
Key characteristics for a small business ERP
In this case, there are numerous ‘must’s’ when considering ERP in the small-business environment.
Avoiding specific feature requirements (these vary wildly from business to business), major themes include:
Ease and speed of initiation: this normally points to a cloud ERP as implementation is faster and upfront costs are lower. A rapid launch phase allows small companies to leverage big company advantages.
Cost efficiency: to avoid blowing a hole the size of Manhattan in small business budgets, costs (including ‘hidden’ costs like training and support) need to be affordable, and the system should offer a relatively quick return on investment.
Elimination of the need to utilize internal tech resources: this characteristic offers further cost reductions in terms of the use of internal resources.
Support on-demand: regardless of the sophisticated nature of a particular company, ERP applications typically take some time to get used to. Consequently, ready support is a must. Unexpected system downtime can be a spanner in the works for small businesses, so it’s important that you have help on-hand when you need it.
Flexible access controls: in small businesses people end up wearing many hats. There may not be a division of labor across departments as there is in larger companies, so being able to modify access quickly is essential.
A good UI: if you work for a small business, you know it’s ‘all hands on deck’. You can’t afford for your workforce to be bogged down with multiple training sessions, so software which is intuitive to use is a must.
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