Small Businesses Reap Big Rewards with ERP Software

 
The mammoth ERP packages of old are no longer the only option when it comes to enterprise solutions. ERP software vendors have witnessing change within their pool of prospects and they are adapting quickly.  Software executives now recognize the importance of the small business owner almost as much as the small business owner recognizes the importance of technology.

The Small Business Owner is Changing

In today’s business environment, deals are no longer guaranteed by who you “know”, the size of your expense account, or the glitziness of your presentation.  More and more small business owners know, that is some ways, the world really is flat.  Presidents and CEO’s of smaller organizations are realizing their competitor is not simply the company down the street.  Lost revenue and decreased market share proves that your competitor can be virtually be any organization throughout the world. And not only is there a lot of competition, the competition is becoming tougher all the time.

This is a paradigm shift, as well as an overall shift in business philosophies.  In years past, small business owners relied on paper and spreadsheets to run their operations.  They relied on personal service to maintain sales.  Today our business leaders know it takes more than Excel to compete against and/or sell to superstores and big box giants.  It not only takes a solid product or service, it takes a lean company that can truly be competitive both in a brick and mortar store front or in an internet based store front that operates 24/7 and sells to customers worldwide.

This shift allows the modern ERP software package to enter and take front stage.  The latest generation of ERP solutions is designed to be functionally robust, user friendly, and easy to use.  Are all software vendors there yet?  No, but if they are not, they are quickly catching up.  Just as the small business owner is adapting, so are the software developers.  And due to this rapid adaptation, small businesses are benefiting with big rewards from their newly installed ERP systems.

The Benefits of ERP Systems

Increased automation, paperless environments, complete audit trails, online graphical reports, detailed cost information, and full exposure to sales activity are just a tip of the benefits small businesses are receiving from their newly installed ERP systems.  Call it marketing hype or public relations ramblings, but quality ERP systems implemented with the right company offer huge rewards to their purchasers.

ERP systems improve overall operations and do so across functional areas and industry segments.  These benefits are both tangible and intangible in nature, but they are certainly available for companies that follow solid software selection and implementation practices.

Sample benefits include:

Ø  Improved Information Visibility

Ø  Increased Ability to Meet Customer Requirements, i.e., EDI, Compliance Labeling, Lead Times and Delivery Windows, E-Commerce Functionality

Ø  More Efficient Cycle Times

Ø  Reductions in Operating Costs

Ø  Reductions in Headcount

Ø  Greater Support for Organizational Growth

Ø  Quicker Time to Market for New Product Launches

Ø  Reductions in Operating Errors

Ø  Reductions in Outstanding Receivables

Ø  Increased Cash Flow

Ø  Reductions in Paperwork and Manual Processes or “Workarounds”

Whether a company is manufacturing and distribution based, moving from a paper based environment to an automated system can offer a wide range of benefits.

The ERP Atmosphere is Changing

As ERP developers are seeing more medium and large size companies move from first time installations to version upgrades, they are becoming more focused on the small business segment.  Software executives have realized additional market share means making their software package easier for small businesses to install, implement, and use in day to day operations.

In the last few years, many ERP vendors have upgraded or repackaged their solutions to include such features as:

Ø  ASP or SaaS Models – This model offers significant opportunities for the right organization.  Benefits include:

o        Lower initial out of pocket costs

o        Reductions in technical staff requirements

o        Faster implementation timeframes

Ø  Enhanced Training Options – From integrated training modules to internet based training sessions, developers are making training faster and less expensive for small companies.

Ø  Configurable Functionality – Older ERP solutions were designed around larger organizations that required functionality developed around segregation of duties and the management of multiple companies, divisions, or locations.  For smaller organizations, this type of processing is unnecessary and often overly complex and time consuming.  Newer ERP solutions have configuration options for selecting which processing method is best for a given implementation.  The implementation team is now allowed to choose transactional processing associated with more complex organizations or processing designed for more simplistic, one dimensional functionality.

Ø  Out of Box Integration – Small companies do not have the onsite technical staff needed to integrate and maintain an ERP package and multiple external packages.  This challenge would reduce or even negate the return derived from deploying an ERP solution.  Many ERP packages now offer built in integration to external packages such as credit card processors, data collection units, online shopping carts, and email servers.  These out of box integration features have produced greater opportunities for overall improvements and ROI justifications.

Although not all ERP packages are not designed for the typical small business, the options are increasing and the small business owner will reap additional benefits.

The Small Business Owner and ERP Developer Align

As our world transforms, so does the small business owner and ERP community.   Ten years ago a CEO was considered a visionary for implementing an ERP system.  Some of his counterparts may even have called him crazy.  Now, even the smallest family owned business is using an ERP solution in their day to day operations.  These companies are seeking out these packages as a potential solution for their operational ailments.  The business leaders are looking forward to a succession plan for their inevitable retirement and know quality business software can help them move the day to day management from them to their children or employees.  They are looking forward to tomorrow.

The small business owner sees the future and knows ERP software will be part of their operations.  And thankfully, the ERP developers are also looking towards the future and designing their systems to accommodate our future entrepreneurs.