Think Your Organization is Too Small for ERP? Think Again.

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There is still a myth lingering out there that only large organizations can implement an ERP (Enterprise Resource Planning) system.  The truth is that all companies can benefit from an ERP or business management software. In an recent report by Aberdeen Group, they found only 27% of small to midsize businessrs (revenue less than $250 million) have implemented an ERP system.  This percentage varied across industries – manufacturers and distributors lead by 63% and 72% respectively.

The implementation of an ERP system can indirectly support growth efforts through efficiencies, however the impact an ERP system can have on the bottom line is more direct.

What are the business drivers impacting ERP Strategies for small to midsize companies with no ERP solution?  According to the Aberdeen Group they are:

  • 48% must reduce cost
  • 35% need to be easier to do business with
  • 27% need to manage growth expectations
  • 25% have pressure to innovate to deliver more value
  • 13% must improve customer response time

When Microsoft Dynamics NAV is implemented with a partner like Commerce Systems Group, it can provide the visibility needed to better service the customer, manage inventory to respond faster to demand, and be standardized to support growth.

When Aberdeen conducted their survey, 17% of small to midsize companies had yet to take the plunge to an ERP system.  What do they use to run their businesses?  Well when asked to select all they use, 57% still use spreadsheets to run their business, 50% only use a basic, simple accounting package, and 22% use home grown applications.  Companies find spreadsheets familiar and with familiarity comes comfort; there is a certain element of danger inherent in using them to run a business.  Spreadsheets do not offer an auditable system.  They also do not provide the same efficiencies and control as an ERP system.

Some companies are fearful od taking the plunge into a total business management software.  Some fee thatl they can function effectively without it or that their businesses  might bee too small to benefit.  Microsoft Dynamics NAV is a scalable solution.  It can grow with your company and is affordable.  You can use it on-premise (install it at your physical location and on your servers) or you can have it hosted (access it on-line).

Of small manufacturing and distribution companies that did take the plunge:

  • 21% saw a reduction in operating cost
  • 17% reduction in inventory
  • 19% reduction in administrative cost

How long did it take for these companies to see the results?  About nine-months after their “Go-Live” date.  It is important to remember to commit appropriate resources to the ERP implementation.  It is a long term commitment of management even after the initial selection process.  A well managed ERP Implementation with Commerce Systems Group can be a source of cost savings and operational improvements.

Commerce Systems group is a Microsoft Dynamics NAV and GP partner headquartered in Virginia Beach, Virginia.  We serve Virginia, North Carolina and Kentucky.

by Commerce Systems Group, a Kentucky Microsoft Dynamics Partner

1 thought on “Think Your Organization is Too Small for ERP? Think Again.”

  1. sorry i saw this site only after purchasing Koku for my new iMac. Koku is just like all the other wsrthleos personal finance sites for mac, imho. i will keep my pc running to access microsoft money program, which was such a fab help & so easy to use. in switching from pc to mac i find the mac so much more user-friendly in design that it blows me away they have yet to come up with an equivalent to the Money program. bummed i wasted money on koku (when i attempted to import financial info it popped up with a screen that said there was a problem and that i may need to pay an extra fee to the bank for this service). great so with no way to import data except by paying yet more money all i have are blank pages!

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