5 ways to boost your business’s success with an ERP system

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Blog Post Written By | ERPFocus

5 Ways ERP Implementation Can Boost Business Success

ERP systems are no longer confined to sprawling corporations and businesses. Now even small-to-medium-sized enterprises are tapping into its capabilities. But what specific areas of your business could be boosted by a successful ERP implementation?

More Efficient Supply Chains

Businesses can improve the efficiency of both the up-and downstream supply chains through ERP implementation. Tackling the paperwork mountain becomes a little easier, as forms and files can be replaced by electronic equivalents. Greater efficiency means that orders and BoM can be electronically submitted to suppliers. Tracking the supply chain within your ERP system will also give your company greater supply traceability and accountability.

The consequences of speeding up and streamlining communications between supplier and customer include lower lead times, faster order fulfillment and more prompt settlement of invoices.

Better Internal Communications

This may not be a benefit that suggests itself immediately, but nevertheless, it is one of the key advantages of implementing ERP. Manual processing by its nature introduces errors and inconsistencies. When a software system is used to record updates and communicate with ley stakeholders automatically, everyone can stay fully informed at all times.

Once you get instantaneous communication with everybody, you have economic activity that’s far more advanced, far more liquid, far more distributed than ever before.” – Marc Andreessen (American Entrepreneur and software engineer).

The efficiency of Business Processes

Don’t expect that implementing an ERP system will suddenly make your business magically efficient. The software is a tool for enforcing and maintaining efficiency. The very process of implementing an EP system will make it essential to review business processes and optimize them for the best performance.

Streamlined Systems

Several different computer programs, different spreadsheets used by different departments, multiple attachments and versions of the same document doing the email rounds. Any of this sound familiar? Bringing together existing silos of information during your ERP implementation is a way to reduce costs, errors, conflicting information, and time wastage.

Higher Revenue

The famous bottom line is also given a boost by the effective implementation of ERP. As mentioned previously, costs and losses can be reduced significantly due to efficiency savings. However, ERP can also be used by a business to increase income. Better customer service standards and speedier order fulfillment directly improve the potential for repeat orders and loyalty. In addition, uniting the data with CRM functions can help to alert the team to future sales opportunities, which can then be pursued by the sales team.

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Which ERP features should small businesses consider?

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Resource Credit | ERPFocus

ERP features for small businesses to consider

While there is a large degree of hyperbole when it comes to ERP these days, when it comes down to it ERPs are still ultimately resourcing management systems. It doesn’t necessarily mean ‘things’ and ‘people’, but how those resource elements interact and combine to enhance overall small business efficiency, or in short, more money on the bottom line.

To achieve this goal, one must leverage several core feature sets, since these are the bedrocks that business is based on. These include:

Streamlined process applications

  • Project management
  • Production control: essential for manufacturers
  • Inventory control
  • Logistical management
  • System security

You could also consider integrated HR and CRM functionality, if you have the budget, your company is big enough to warrant it, and you don’t already have a system in place.

Integrated financial applications

  • GAAP Accounting
  • Consolidated Financial Management

Direct reporting

Reporting, preferably with real-time data, is a major benefit of implementing an ERP. Alongside the broad-level feature-sets outlined above, here are a few reports to look for when shopping for systems:

  • Sales: for example, quotation list, list of sales orders
  • CRM: for example, contact list
  • HR: for example, personal FTE information, emergency contact
  • Project management: for example, functional timelines
  • Production control: for example, product line counts, finished goods tallies
  • Inventory control: for example, bin counts, distribution logs, shipping logs
  • GAAP accounting: for example, GL, AR, AP, payroll
  • Consolidated financial management: for example, divisional reporting
  • System security: for example, failure/recovery reports

Everything else; and we mean everything.

In this area, we identify various follow on tiers that can be applied to a small business ERP platform. Some of these elements include:

  • In/outbound business intelligence – the goal is to allow the enterprise to ‘see and respond’ to the totality of its market in real-time.
  • In/outbound mobility – the goal is to directly bind the customers to the enterprise, buy means of a host of communications mechanisms.
  • In/outbound social networking – the goal is to create a virtually-persistent channel between customers and business.
  • Automated operational scripting – the goal is to alleviate manual processing throughout the system, and the enterprise at-large.

Each of these requirements sections applies the same value sets ranging from the elimination of process waste to reduction cost, ultimately leading the enterprise to achieve enhanced revenues over time.

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Selecting a cloud-based ERP for your small business

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How to select a cloud-based ERP for a small business

Enterprise resource planning software. It sounds our of reach for most small businesses. A system reserved for big multinationals with thousands of users and lots of cash lying around. Perhaps it’s because of the name? In fact, more and more small businesses are adopting ERP. Advances in technology (think cloud) bring new levels of productivity at lower costs to businesses of all sizes.

These efficiency-boosting tools aren’t out of reach anymore. But choosing the right ERP for your business is a challenge. This quick guide will steer you in the right direction.

ERP requirements for small businesses

The abundance of choice can make an ERP selection mind-boggling. For small businesses with limited resources, the majority of research and decision-making rests on a small number of shoulders. Defining what exactly you need your ERP to do is the first step. Every business is unique in its challenges so you’ll need to align your strategic goals with your ERP requirements:

  • Map the processes you need to streamline and prioritize features accordingly.
  • Look for system failures specific to your industry and look for vendors who fit.
  • Calculate your budget and forecast your ROI
  • Decide if you have enough in-house experience or need an independent consultant

Cloud vs on-premise ERP

One of the biggest challenges for small businesses looking to invest in new software has been infrastructure. Traditionally, if you didn’t have the right environment or enough hardware to support it, an upgrade would require serious investment. Even if you did have the capital to get enough hardware and on-premise storage to handle an ERP system, your time to ROI could make the whole project untenable.

Luckily, the cloud has come to the rescue. Small businesses can store more data and implement new business apps without killing the bottom line. Cloud services are typically sold as a subscription service, making it easier to get underway without huge upfront costs. Cash flow is king for small businesses so fixed costs are preferable to spikes in investment that can you leave you vulnerable.

Cloud subscriptions remove barriers for small businesses that want to invest in ERP. But that doesn’t mean you should jump in with both feet. Compare vendor prices and models carefully. Look at your growth projections and contract durations on offer. If you expect to grow your user base, make sure you choose a plan that gives you plenty of breathing room. Most plans are priced per user (or on a range of users). You might think that 10 or 20 users are enough today, but what happens in one, two, or five years’ time?

Shortlisting cloud-based ERPs

Now you know what problems you want your ERP to solve, that cloud is the most likely route and how to create a selection process, it’s time to put the wheels in motion. It probably won’t take long to whittle your options down to a shortlist. Once you have a list of requirements, it’s time to set about requesting proposals.

ERP options have now become more affordable for small businesses to consider. We have experience advising small businesses on which functionalities would best suit their needs in their new ERP solution. If you would like to learn more about how cloud-based business solutions can help grow your business, contact allonline365 on  info@allonline365.com or +27 (21) 205 3650.

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Resource Credit | ERPFocus

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