ERP in the small business space—don’t confuse small with simple! | The Business Management Blog

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ERP in the small business space—don’t confuse small with simple!

4/13/2012 at 7:45 am by

E is for Enterprise.

The acronymn ERP, similar to a lot of popular phrases, can easily become a meaningless abbreviation. To some people, ERP is a synonym for an accounting system, while for others, it describes any fairly comprehensive business application. To me, it is the letter “E” that has always stood out, and that single letter “E” stands for enterprise. That word alone implies a certain business scaleit sounds forbidding, something most small to medium-sized businesses (SMBs) just don’t relate to.

Fear on many levels.  

Many small business executives steer away from ERP out of fear. And there’s more than enough fear to go around!

There’s the fear of appearing ignorant (“I don’t really understand what ERP is all about”), the fear of significant cost (“I know that ERP projects can sink a company”), and the fear that they might be embarking on a large, complex project without the necessary skills and resources needed to see it through a successful implementation. Many executives simply dismiss ERP as a solution that is not well suited for their business and don’t even explore the potential benefits, or even worse, launch the process with a preconceived notion of how overly simple their business is.

Don’t confuse small with simple.  

Here’s some sound advice for those of you thinking about ERP. Don’t confuse small with simple. Don’t come to the table with preconceptions about how simple your business is. Your business may be simple to you and your employees because together you’ve built it, designed it, and worked in it for 20 years, but the systems that support your business very likely embody complex rules, procedures, and processes that are essential to your future success. Those requirements can’t be addressed if they aren’t identified and explained. You can’t find a “better way” if you can’t explain your current way of doing business. So be prepared to discuss those requirements, not hide them!

A small enterprise is still an enterprise. 

Over the past ten years we’ve seen the emergence of the small enterprise: small companies that are global; operate in more than one time zone; consist of more than one company and/or currency; have multi-channel sales models (web, EDI, phone, paper); depend on a very tight integration with their supply chain partners to thrive on thin margins; and need to report financial results quickly, not just at month end. The list goes on. Perhaps not all of these small enterprise descriptions apply to you, but I suspect that more of them do than don’t. And that is what makes you a candidate for ERP, with a capital “E”!

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