As popular as Enterprise Resource Planning (ERP) systems are these days, many organizations are still unsure whether they’re worth the time and expense for their specific business situation. Once considered purely geared towards the manufacturing industry, ERP in 2015 has become as widespread and adopted as POS systems and CRM software across all enterprise industries. However, that doesn’t necessarily mean it’s the right choice for you. Here are some examples of scenarios where selecting an ERP would be the smart thing to do.
1) Your Business Has Too Many Disparate Software Systems
Regardless of industry niche, many businesses utilize a plethora of unique and separated software/processes to perform certain tasks and produce certain data. Be it payroll or HR or Inventory control; it’s still a fairly common occurrence to see multiple pieces of non-communicative software attempting to handle all the day to day necessities of running a business. Unfortunately, even if that has worked “this far”, it’s likely causing a host of inefficiencies that could be easily solved by implementing an all-in-one ERP package.
Many organizations in this situation feel as if they are stuck between the proverbial rock and hard place; they want to improve their processes and systems but aren’t in a position of economic growth that would justify the expense of implementing what amounts to a company-wide heart transplant. This scenario comes down to the chicken or the egg dilemma; do you wait until your business has grown enough to afford the new system, or do you take the plunge and use the new technology to facilitate the growth you’re looking for? It’s a tough call, but there are alternatives such as Cloud based ERP systems that could suit smaller companies quite well without breaking the bank or interrupting crucial business operations.
2) You Keep Hiring More Labor to Offset Labor Inefficiencies
This is one of the more frightening scenarios businesses face; your labor productivity levels are waning, so you hire more labor to pick up the slack. But if your processes and organizational/reporting systems are inefficient to begin with, you’re just going to add more fuel to the flame and end up with even more labor inefficiencies. Seeing as manual labor is arguably the most expensive asset in many enterprise organizations, this can be a troublesome situation.
A properly selected and implemented ERP system can often help waylay these labor related issues. By providing more accurate real-time data from the shop floor and using the ERP to better organize/direct your labor force, you can potentially remove the need for more labor by using your current employees to the maximum effectiveness. It’s a perfect example of the old adage “Work smarter, not harder.”
3) Your Outdated Systems Cannot Keep Up with Modern Technology
These days, both people and business software requires a constant connection to the internet and all the data it can provide your organization. You need to know about current trends and statistics in real-time, as well as getting usable feedback from consumers, retailers, distributors, materials suppliers, and your competition. If your business systems are too old and disconnected, then chances are you’re missing out on valuable information that can improve your processes, your products, and your customer interactions.
By implementing an ERP in this situation, you’re gaining the advantage of being able to make changes on the fly instead of waiting for quarterly reports. It’s a proactive versus reactive situation where you predict the best course of action as opposed to waiting until the numbers drop before making improvements. This type of business management isn’t even a preference anymore; it’s become a necessity for most organizations.
If any of these scenarios sound familiar, then it might be a good time to start looking into implementing an ERP for your business. It may seem daunting at first, but the end result will be more efficient business processes and increased revenue – which will allow you to make even better decisions in the future.
If you need help selecting a new or upgraded ERP for your business, check out our short FREE eBook below; we walk you through the most important steps you should take before you even think about selecting an ERP system, from planning to purchasing.
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