It can been said that, all companies are a collection of management systems, while the best companies tend to be those employing the best systems. The possibilities for management systems in a company are endless, but examples common to many organizations would be:
- Accounting, financial management and reporting systems.
- Human Resource management systems.
- Payroll systems.
- Inventory systems.
- Sales planning, shipping and invoicing systems.
- Customer Relationship Management (CRM) systems.
- Purchasing systems.
Undoubtedly, your company has some or several of these aforementioned systems. Yet, unless your company has implemented an ERP, chances are they are disparate systems and unable to share and/or access the same data.
In its purest sense, an ERP achieves total integration such that all systems share and access the same data. Entering the same data into more than one system is never (or rarely) required. Not only is data entry more efficient (and less costly), it is inherently more accurate and timely.
Few things are more frustrating to administration teams than having to enter the same data into multiple disparate systems or having to manually enter the output from one system as data input into another system (i.e. invoicing output from a Sales system being manually entered into the Accounting system).
Few things frustrate accounting teams more than trying to close month-end reporting and finding conflicting data reported on the same item when pulled from different systems. Reconciling accounts in the accounting system can be difficult enough, without having to reconcile key data in other systems where inconsistencies exist. And make no mistake, the more times an element of data is entered into various systems, the more likely there will be an error.
These frustrations and costs are certainly mitigated with an effective ERP system.
Multinational companies worldwide are investing millions of dollars to implement sophisticated ERP systems and, in some cases, are spending years to fully implement. Avoiding the aforementioned frustrations is part of their motivation, but principally, companies are driven to implement ‘best available technology’ as they strive to:
- Better understand all the operating elements of their business utilizing ERPs unprecedented levels of business data for analyses.
- More expediently respond to issues affecting their business.
- Reduce administration costs by reducing redundant data entries.
- Improve the accuracy and reliability of the information upon which they make operational and strategic decisions.
Million-dollar investments for management systems have been beyond the scope of most small-to-medium-sized-enterprises (SMEs). Yet in recent years, the ERP environment has changed dramatically. Today a plethora of Cloud-Based systems are available where implementation costs are reasonable and on-going monthly licensing fees are manageable by all but financially-challenged companies. And the benefits that large multi-national companies realize through million-dollar ERP investments can be realized in SMEs with the affordable systems available today.
The key for improving corporate performance is having accurate business information available in a timely manner, at the lowest possible costs, and integrating the power of this data-management system with the power of a formal Performance Management program.
What’s holding you back?