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When To Move From Small Business Accounting To ERP

TEKOA ERP

A key factor when moving from a small business accounting application into Enterprise Resource Planning (ERP) software is - Data Size and Analysis.


by: Tre Hazelbaker


Today's Enterprises are faced with many technology choices. With the consistent growth of companies in today’s society it can be a challenge to know when it is the right time to move out of small business accounting applications and into a midsize ERP solution.  Staying competitive is also becoming increasingly difficult and the need to differentiate yourself amongst the competitors is a driving force.  As the enterprise grows, there comes a time when the limitations of small business accounting software inflicts real pain to the organization, and decisions must be made to move the venture forward into new opportunity and development.  One must have the right tools to make the move successfully, and it might be time to consider upgrading your small business accounting software into an ERP System. 

Easy "Time To Move To ERP" Indicator

An easy to identify indication that it is time to make the move to ERP is the size and complexity of your enterprise data.  As the business grows, there is the lingering problem with data management - that is, the when, who, what and why questions that run daily operations. These questions are answered with data.  Analyzing that data, and working with that data is mission critical to business navigation.  Bigger business means bigger amounts of data.  There is data in regards to every aspect of an organization. Wise organizations constantly analyzing this data in order to give their firm the competitive edge. Using enterprise data, managers can measure, and thus know more about their businesses, and directly translate that knowledge into improved decision making and performance. The larger the amount of data, the more difficult it is to work with, let alone comprehend to the point where you can use it to help you make decisions to put the company in a better position.  It's time for a move to ERP.

Real World Example

Lets take a look at this from a real world perspective. Consider you’re the manager of a local clothing retailer. As the manager at this clothing retailer you’re going to want the data for the sales for the different departments of clothing. Your also going to want the sales numbers from each particular brand. As a result you’re going to be overwhelmed with data figures and how to analyze them. Then, you’re going to feel the need to hire someone to analyze the data to ultimately explain it to you in English. These figures will assist you when deciding which brands and products to discontinue and which products to purchase more of to increase sales numbers. The next issue arises when sharing data with other stores to assist them with products to purchase. There has to be a solution to assist individuals in managing these large amounts of data.

ERP Solutions to Data Management Problems

One of the best solutions to assist in management of these large amounts of data is to implement a full ERP Software System to help this management. ERP systems allow for companies to manage large amounts of data in an efficient manner in order to make decisions in a timely manner. Small Business Accounting applications get weighed down when there is a lot of data.  ERP Systems are more robust and manage big data more effectively. 

ERP systems are designed to take in large amounts of data, formulate the data into comprehendible sets where an individual can use them. ERP systems also allow for this information to be shared company wide, which allows the information to get to important individuals in a timely manner.

Through the use of the ERP systems, companies can manage important data is a timely and more efficient manner than the constant jockeying of data in and out of spreadsheets to make daily operations flow. As the manager of a clothing retailer, I personally would want to be able to send my figures to my seniors and get approvals quicker and analyze the data more effectively. ERP provides higher data efficiency and individuals can make the company more profitable and see advances quicker. 

Wrapping It Up - When Should I Move?

When to move from a small business accounting software into ERP Technology?  When your staff spend too much time moving data in and out of spreadsheets and other analytic tools or databases in order to make the business flow.  Then it is time to consider the consolidated approach an ERP System provides.
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