Using the correct method to forecast, report and plan is crucial to any business.  We would challenge you to find someone that will state they do not need to use spreadsheets for their business, in fact you will find that almost everyone will say spreadsheets have their limit but we still need them to function.

So where do ERP solutions come into play for a business and when is it correct to invest in ERP – it’s a big question?

The quick answer is when a business has the actions below but no system to support maybe the conversation around ERP is needed:

  • Multiple data sources in different locations coming from different people/departments
  • You need all the data as one source to aid your planning process
  • Real time data against historic data creating effective business decisions
  • A Complex Supply Chain
  • Market place demand which leads to variability i.e. costs not actual when changes are made
  • What If scenarios can not be achieved
  • IT department resources are limited
  • Multiple people and departments need to access the same information at the same time
  • The businesses KPI’s need improvement i.e margin, revenue and inventory

Below we discuss Spreadsheets v’s ERP  Solutions for businesses in a little more detail in an comparison table so – Let’s compare in detail:

 Requirement

 

 Spreadsheets

 

ERP ERP Benefit
Unique Business NeedsConfigurable (limited)CustomisableBetter solution fit to meet business objectives
IntegrationStand alone with possible sync across some systems with back end databaseIntegrated key business systemsData exchange between roles and departments.  Reduced admin and data redundancy.  Less vendor management
Data RedundancyClient data replicated across each systemEliminated.  One set of data presented in various formats depending on roleEach role view of the data is current and correct.  Huge reduction in data cleansing
MaintenanceComplexity increases with business growthMaintaining one ERP system data regardless of size of businessLower IT system maintenance costs – Contract with one vendor
IT SupportInternal IT resources required with knowledge of each systemBlend of provider and internal resources managing one systemReduce internal IT resource required – reduce costs
Inter-departmental VisibilityPoor or non-existentInherent & real-timeImproved holistic business intelligence due to the ability to view real-time data across departments
KPI VisibilityNeed to access each system separately – reports based on data at an historic point in timeDashboard views of real-time data based on role and business requirementDramatic improvement in management’s ability to monitor business performance with one dashboard view presenting in real-time
AdministrationHigh – admin across multiple systems and pooled reportsLow to mediumReduced administration time for staff as less systems to maintain data in
Process Workflows Across DepartmentsNone or poor if anyCustomisable with triggers and expection reportsRequired actions triggered on time and to completion across multi-functional teamsImproved customers service and retention
Inventory CostsHigher – based on historic patterns and/or subjective opinionLower – based on real-time order data and real-time trendsReduced inventory and warehouse management costs
ForecastingDifficulty as reports required from unlinked systems and based on historic dataReal-time data across multiple functional processes from one system i.e. inventory management based on actual and projected sales ordersImproved ability to accurately forecast in shorter time frame in real-time – improved planning and ability of business to react to exceptional events
CostingSimplistic view of costings ignoring time and internal labour factorsTrack actual costs of activities and perform activity based costingImproved understanding of cost of conducting business, based on data consolidated across production or supply chain elements
Customer ServiceDepartments view only their role related dataCustomer service reps have improved access to client related data across multiple functional areas.Improved customers service, retention and business decisions
Compliance & Best PracticeNon-existent or difficult to implementSolution can be developed for compliance and industry vertical best practiceImproved compliance across different jurisdictions and processes improved based on industry vertical best practice
AdaptabilityDifficult as changes required across multiple systems often with unanticipated downstream impactsBusiness processes implemented in one core system – changes in one area of the system will then show the impacts downstreamEasy to adapt, adopt and restructure
ScalabilityPerformance and usability decreases with increased sizeStructured & modular design with add-onsScalable solution in line with increases in business growth and/or complexity
Global OutreachLimited or costlyOptional modules, and available in multi-languagesBetter system fit for business operating or servicing customers in multiple jurisdictions
E-CommerceLimited if any functionalityOptional moduleFront end to back end integration, which provides streamlined processes

So in summary, if the answer to the following questions result in a YES, then it is time for your business to look for an ERP solution:

Q: Would the time spent in spreadsheets be more effectively spent with tools inside an ERP solution? (Save resource and revenue)

Q: Do you require real time reporting that allows for growth, business planning, forecasting, cost management and resourcing effectively?

Q: If your business is across multiple sites – do you need more control and visibility?

Q: Is collaboration a key component if improved will benefit many functions within your business?

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