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When Should Your SMB Look Into an ERP System?

Businesses grow. Well, at least the successful ones do! Growth is usually followed by the expansion of business processes. If you own a growing business, you’ve likely noticed this trend. If your business processes are getting too complex for you to manage efficiently, you should start looking into an ERP system.

What is an ERP system?

An ERP (Enterprise Resource Planning) system is an umbrella system that brings your business’ processes all under one big system. For instance, you might have purchase and inventory management, HR management, payroll and accounting management, and even a customer relationship management (CRM) system that itself houses things like email marketing, customer service, sales call optimization and more. Just listing them all out can get complicated and messy – now imagine running them efficiently with only a small team!

Integrating these systems only means bigger headaches. Manually passing information from one system to another, apart from being tedious, would make the processes highly prone to human error.

With an ERP system, program integration is made simpler. Everything from employee income to automated drip email campaigns would run at the right time and with less effort on your part. As long as the data sharing, process integration and system configurations have been correctly handled, you wouldn’t need to do any more than you’re already doing, but the programs would all talk to one another and inform one another, so you could gather greater insight into what’s driving revenue.

Does your business need an ERP system?

As wonderful as having an ERP system sounds, it isn’t a choice every single business should make; some might need it and some might not. But, how do you know if you need it? Let’s have a look at possible reasons you might benefit from an ERP system.

1. You have a cornucopia of applications and software.

If you happen to be unlucky enough to have a different software package for every business process, then you need to get an ERP system. Taking data from one system and using it as input for another one will waste time and energy, as well as increase the chances of making errors. This will almost always affect the end result, possibly leading to major mistakes.

2. Running individual applications is a pain.

If you’re having trouble running the stand-alone applications (perhaps because you have to keep feeding it data from another process,) then you need to get an ERP system. ERP systems of today are designed with the end-user in mind. Neck-to-neck competition means they’ve been innovative enough to provide their users with the most user-friendly solutions possible.

3. Processes take too long.

If your employees have to wait an extra day because the payroll process hasn’t been completed or you have to wait a day or two to get an important report, your applications aren’t doing their jobs. An ERP system will streamline your process from start to finish. As long as your data is correct, everyone will be able to get their results on time.

4. Your results aren’t correct.

If there’s anything worse than late reports, it’s incorrect reports. You wouldn’t want to make your decisions based on inaccurate data. Your reporting applications could be dropping data or entirely ignoring a sub-process; regardless, you’ll lead your business into the ground if you make critical decisions based entirely on erroneous reports.

5. You have unhappy clients.

If your clients have access to some faction of your processes, like a purchase order system or a customer relations management (CRM) system, those processes need to work perfectly. Nothing could turn your clients away quicker than a system that crashes or results in the wrong outcome whenever they try to use it. If you have buggy or lagging applications, look into getting a modern and integrated system in place.

6. Future plans are being drawn.

If you’re planning to take your business to the next level, you need to take every system into consideration.

Your growth plan should include necessary steps to migrate data stored in your independent applications into a complete ERP solution. As your business grows, the processes will continue to get even more complex and you will need one powerful central system to handle the complex calculations for you.

So, do you need an ERP?

There are clear signs indicating when it’s time to get an ERP system. Don’t rush into signing up for one if you don’t need one – ERP systems are complex and expensive, requiring time and effort to program correctly. But if you’re fed up with the inefficient web of programs you’re currently using, consider your options. There are tons of ERPs available and you’re sure to find one that meets your needs.

 

 

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