5 Reasons to Use an ERP System for Your Small Business
When your business starts to expand and grow, you’ll find that there are a lot of moving parts that aren’t always easy to coordinate. As your business scales, you might find that it makes sense to engage an enterprise resource planning (ERP) application to gain better visibility, which can help you make data-driven decisions.
What Is ERP?
Enterprise resource planning is just what it sounds like: it’s a way of making sure what you need for your business is coordinated. It goes beyond your business plan and takes you into the nitty-gritty of managing day-to-day operations.
ERP is about making sure that your business is integrated on all levels, from taking customer orders to managing your supply chain, costing, and budgeting. The platform encompasses your overall organization, including marketing and sales, and even product planning. It’s a way of looking at the big picture and organizing your business systems so that your data is accurate and shared across departments and processes, and so that you get timely feedback to plan for the future.
With a very small business, ERP might not seem important at first; if you're just starting out, there is a good chance that you're taking care of everything on your own. However, as your business grows, you will inevitably and develop more systems and processes to manage your growth. You will need a way to make sure that everyone is on the same page. This is where ERP comes in.
Why Use an ERP System
You might be surprised at how helpful the right ERP approach can be as you grow your business. Here are some of the ways that a properly tuned ERP implementation can help your business perform more efficiently and effectively:
1. Track your business resources. Do you know what your business has in terms of cash, raw materials, personnel, and production capacity? These resources are what you use to keep your business running. You should be aware of where you stand at all times.
2. Know your commitments. ERP matches your resources with your commitments. Do you have the production capacity to keep up with the sales you’re making? A good ERP system can help you sync up your resources with your commitments and let you shift your planning quickly to keep up with demand. There’s no point in making more of Product A if Product B is walking off the shelves.
3. Analyze consumer behavior. You can also use ERP systems to help you analyze consumer data. This allows you to see what is effective, what might be on the verge of breaking, and what you can do to capture a bigger share of the market.
4. Manage information flow. Information is important in today’s fast-paced business world. You need to manage online and offline aspects of your business, and make sure your various departments are communicating. Your ERP process helps ensure that everyone has the data they need, all neatly managed from a central source.
5. Maximize your time. The point of enterprise resource planning is to put a system in place that helps you maximize your time so that your business runs efficiently with less waste. Additionally, it’s a good way to automate some of your tasks and processes in a way that leaves you—and your team—free to concentrate on more important matters that are likely to have a bigger impact on your business.
Initial deployment can take some time, and enterprise platforms often require patches and updates to remain secure and run smoothly. Automation can be achieved with ERP tools like Panaya that handle the update, upgrade, and patching process of these software so that IT departments can save time for more essential tasks.
The reality is that when you are a business owner, you get to a point where you can’t do everything. You need all the help you can get managing your business. Good enterprise resource planning smooths your path; it allows you to grow your business while at the same time frees you up to focus on big picture items that will prove more profitable in the end.
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