When should you upgrade your accounting system to an ERP system?
Many businesses often start with an off-the-shelf accounting system, such as Xero, MYOB or QBS. These software have predesigned and simple processes, systems and reporting and are an excellent option for a small business. However, there are great benefits to be had for growing and complex businesses in moving to an Enterprise Resource Planning (ERP) system. You should consider upgrading and investing in an ERP system if you identify with any of the common reasons below.
Your business processes become inefficient and time consuming
Inefficiencies derail production, stall timelines and affect your bottom line. As your business grows and your demands increase, it is common to integrate an add-on to cover a gap in your current system. Your business may be using different systems for: receivables and payables; sales and custom orders; or tracking and receiving. This will cause your system to become clunky, as the applications cannot communicate efficiently. You may also be compensating for a gap in your current system with manual reconciliations and multiple Excel spread sheets. This is time-consuming and requires hours of manual entry which can be difficult and expensive. ERP systems can reduce the time spent on this by streamlining and automating many of your business processes. This also reduces potential manual error.
Attempting to track data over multiple platforms
Growing businesses produce more data. Tracking this data over multiple platforms is time consuming, costly and increases the likelihood of mistakes. Your employees may be struggling to meet deadlines and extract the data they need, which makes understanding your current performance, analysis and report writing difficult and time-consuming. ERP systems streamline business processes to integrate sourcing, jobbing, stock management, production processes, sales and distribution. These systems also eliminate duplication issues that can occur with multiple software integrations. ERP systems allow you to easily access data anywhere, anytime to efficiently record, analyse and improve your processes and business decisions. ERP systems decrease frustration by streamlining your business processes and increasing productivity.
Business is struggling to meet customer demands
Customers are the lifeblood of business. Your company will experience a huge loss if your business doesn’t deliver on a product or service. ERP systems can help your business if you are having difficulty manufacturing or managing and tracking inventory, receiving financial information or producing services for clients. These systems allow you to organise and access accurate data and insights from your internal processes in one location with a single, easy-to-navigate dashboard. Your managers can easily access management, accounting, CRM, shipping, case and contract information to account for changes in demand to help scale your business accurately. ERP systems ensure your company has the right amount of product at the right location and tracks customer order status to allow relevant employees and departments to assist with any issues.
Spending too much on software integration
License fees. Staffing. Training. Operations. Programming. The cost of multiple integration systems can add up quickly and will further increase as the system becomes older and unsupported. You may have noticed your business is logging more support calls to your software vendor and may be contemplating hiring a programmer to write new functions for a specialised process. This is a cycle that continues if you only patch the superficial issue rather acknowledge and fix the underlying issue. An ERP system is able to store all your business data in one location for multiple business operations, including: accounting, manufacturing, CRM and HR. ERP systems are designed to grow with your business.
Forecasts based on guesswork
Growing businesses require features beyond a basic accounting system to provide robust and reliable manufacturing and distribution capabilities. It is impossible for your business to run smoothly if the front and back ends are running separately on two different platforms or even if your CRM is running without a link to your main goods and services. The effect of this is further increased if the data is stored incorrectly in one of the departments. ERP systems use Business Intelligence reporting features to provide your business with real-time data, whole of business and prepare forecasts for customer and product demand. This allows your managers to make strategic and profitable business decisions related to scheduling production, labour management and buying inventory. The dashboards in your ERP system can be configured to suit the needs of each of the onsite managers to allow your business to cut costs, increase productivity and boost sales.
Is your software holding you back?
Your current software may be holding your business back from growing. Therefore, for a growing business, it is not a question of if you need an ERP system but when you need it. ERP systems can keep up with the pace of your business while providing you with a holistic view of your operations and allow you to access your data immediately. These systems keep your business processes up-to-date with efficient, intelligent technology that automates your professional and accounting processes and drives your business forward.
We can help
ABC Business Solutions offers personalised software recommendations to suit your business size and company needs. Contact ABC Business Solutions today or browse our website to see how Ostendo, MYOB Exo or MYOB Advanced may help you reach your business goals.