Is your Business Ready for an ERP System?
Maximizing profit and minimizing loss is the primary goal for businesses of all sizes. Some businesses may focus on maximizing profit more intently than minimizing loss, while others may choose the opposite approach. ERP systems, or Enterprise Resource Planning systems, assist or outright handle business processes throughout an organization. Depending on your business, you may or may not have a need for an ERP system; and that’s why we are starting a discussion on that topic: to help you determine if it’s time for your business to seek an ERP solution.
First, there are numerous advantages (and disadvantages) to choosing and implementing an ERP system. The first question that every business owner who is considering an ERP must answer is, “Will it satisfy my needs?” If you’re looking to maximize profit, will an ERP help you to accomplish that goal? If you desperately need to cut your losses, is an ERP system an appropriate solution for doing so? If you don’t know, that’s okay! Below, we’ve outlined some advantages and disadvantages to implementing and using an ERP that will help you to better answer those questions.
- A single database that can be shared across departments and workstations
- Deep integration between applications (i.e. HR is integrated with financial management)
- Efficiency: an ERP system can eliminate unnecessary processes, and declutter complex processes
- Combining core and extended components (i.e. your CRM integrates with your financial management, HR, and operations management modules).
- Better customer service
- Cost: According to Panorama Consulting, 55% of respondents reported that they went over their implementation budget.
- Overall Satisfaction: Panorama Consulting reports that in 2015 44% of businesses that implemented an ERP solution were neutral on whether or not it satisfied their needs, with 37% saying they were satisfied.
- Over scheduled: Again, Panorama Consulting reports that 44% of respondents went over their scheduled project duration due to unrealistic timelines and expanded project scope
- The ability to share data across departments reduces employee control over data, and all but eliminates the Gatekeeper.
If you’re trying to decide whether or not your business needs an ERP system, continue to research the products available, and whether or not your business would increase efficiency or with the system. Have you already implemented an ERP system, or thinking about implementing one? Drop a comment below!