03 Apr Great ERP benefits for any size business
Recently, my wife started a small hobby business out of our home: selling her extremely delicious cake pops to friends and neighbors. Wanting to help out, but being completely and embarrassingly terrible at dipping cake pops, I offered to assist her by creating a spreadsheet for her to use to track her orders, inventory, and sales. She humored me, so I got to work building a spreadsheet that she could use to note her costs alongside her sales, as well as her inventory and associated costs. It very quickly got complicated. She sells only one product, has a small number of costs, and deals with no payroll (I didn’t make the cut—the cake pops are surprisingly difficult to make look good). Despite being as basic a business as you can run, I could feel my small tool already straining to serve my wife’s needs. Imagine if she wanted to scale up to sell large numbers of cake pops to distributors or local businesses! She’d very quickly require better tools than my cobbled-together spreadsheet.
If she would allow me to stay on as a consultant (which after my sorry dipping performance is not guaranteed), I’d recommend an Enterprise Resource Planning (ERP) solution to help with procurement, project management, accounting, and other mission-critical data tools. ERP solutions enable your business to have one source of truth for your data to have a true and consistent view of your resources and performance, giving you the power to improve insight into your operations, lower costs, and better collaborate across business functions
Improve internal insight
As the old adage says, knowledge is power. I’d further that adage to state that the sooner you know something, the sooner you have power. A little more awkward, sure, but it rings especially true in the information age. An ERP tool, like Oracle ERP, can quickly create operational reports that relate to your goals or projects, financial reports for your accounting team, and management reports for your executive team to quickly understand company performance and point out weak spots. This type of data can have an outsized impact on a company’s performance, helping to drive better decisions. In fact, 89% of CIOs and IT professionals believe that real-time data delivery is extremely valuable for an organization.
Lower operational costs
As your business grows, you’re always chasing the inefficiencies to improve performance, looking to find the bottlenecks and quash them. ERP systems are developed to drive order, rather than disorganization. Using a single source of data ensures that everything is always up to date and correct. When a task is completed, like a financial statement or an invoice, the organization can have full confidence that it’s correct. That means no revisions and no wasted time or resources. In addition, based on the insights gained and decisions made from real-time data and reporting, it’s much easier to see inefficiencies in your company’s process. Fixing those inefficiencies leads to quick wins and reduced costs.
Collaborate across functions
A good ERP system like Oracle ERP is implemented to tear down silos that crop up in your quest to grow and scale. As noted above, you can’t have multiple sources of truth for your data. That’s a one-way ticket to disorganization and distrust. Whose numbers can you rely on, Ops or Finance? You should never have to make that choice. Having your ERP deliver the correct numbers to everyone means that all of your organizations have access to good data so they can develop good ideas and build off one another to make the correct decisions together. A necessary part of having good data is delivering good data, which is the main goal of an ERP system, whether that’s through custom reports or org-wide data availability.
ERP tools convey important and necessary data through an organization and are one of the most important systems for your operations. Across your finance/accounting, product, project management, and other necessary business functions, you need to have confidence in the numbers going in and out. They become the lynchpin to decision making across the company. Even though my wife’s cake pop business is currently small, I’ll be utilizing ERP best practices like those found in Oracle.
If you’re further along and are considering an ERP system implementation, or require an upgrade of your current ERP tool, contact Simplus today.