Enterprise resource planning allows small businesses to compete with the large companies.
Because of the large requirements of enterprise resource planning (ERP) and the perception of risk getting it established, small business owners often mistake ERP as a tactic suitable only for the “big dogs.”
But if your small business wants to run with the “big dogs,” you might want to take a closer look at ERP. It could provide more advantages to your company than you first thought. Read on to discover more about ERP, and our tips for its usage.
ERP on a Small Scale
Yes, large businesses do take advantage of ERP, but that doesn’t mean small- and medium-sized businesses can’t do that as well. The great thing about ERP is that it’s scalable. ERP’s essence focuses on process. Regardless of the size of your business, you employ processes to get the work done and deliver it. ERP enables any business to analyze, build, and implement processes that automate routine workflows and customer relationship management applications.
The applications for ERP run everything from workflow management to technology updates. This allows skilled, valuable staff to concentrate their brainpower and time on higher level tasks that will better serve client needs.
ERP doesn’t have to encompass every aspect of the business. In fact, it’s probably best if it doesn’t. Processes must be updated periodically to adjust to changes in business as well as technology. Feasible, robust ERP strategies that govern the how, when, and who of the delivery process for your products or services can be separated by service or product category.
ERP for Growth
A well-crafted enterprise resource plan begins with “a solid, vetted business plan,” according to SCORE, an organization that recruits thousands of business executives to mentor entrepreneurs starting their own small businesses. The business plan identifies the assets and challenges of your starting point and the steps that lead to your vision of success. Oftentimes, success remains small, serving a niche market. But small doesn’t necessarily mean a one-man-shop, either. The moment you add an employee, business processes will have to expand to guide his or her performance of the tasks assigned.
But IT Business Edge still advises entrepreneurs to begin small when incorporating automation. The tasks to be automated, says writer Larry Alton, are “vital but also quite time consuming.”
Deciding What to Automate
The crucial part of setting up any ERP initiative is to determine what will be automated, before determining the how or who. Here are some of your options:
Marketing. Who has time to post updates on Twitter, Facebook, Instagram, Google+, Pinterest, and whatever other social media platforms used to promote your business and build client relationships? Marketing automation can take advantage of programs like Hootsuite, Buffer, or Okotopost.
Inventory and Point of Sale. An easy-to-use point-of-sale (POS) system helps your staff keep track of what’s in inventory and who has bought what. The good ones also track customer information that you can mine for marketing purposes to run targeted advertising campaigns.
Customer Service and Support. Customer service and support will always require the human touch, but much of that work, such as frequently asked questions, can be automated.
Human Resources. Ultimately, managing people needs to be personal. But some routine tasks can be automated, such as hiring processes, time off requests, and scheduling shift work.
The Process of Automation
Once you’ve identified what will be automated, it’s time to develop how it will be automated and who will be responsible for it.
Accountabilities for benchmark metrics keep watchful eyes on the process to ensure it proceeds according to plan. Because much of the work at your company is not comprised of one-off tasks, you can identify the parts that can be standardized and repeated consistently. Even if you run an art studio dedicated to creating one-of-a-kind masterpieces, there’s a process for setting up the medium that will showcase your artwork.
Be sure to follow these 5 steps when setting up your enterprise resource program:
Standardize and document repeated tasks. You don’t have to reinvent the wheel every time you begin a new project or add a new product. Standardizing and documenting forces you to think about each step in the process so you can streamline where possible and maintain a base standard of quality control.
Identify and implement software for automation. Although automation can eliminate some jobs, the ultimate goals are to maximize efficiency and quality while reducing cost. Today’s technology offers a myriad of software packages that will assist you in making you and your workers more efficient. An outside consultant with an objective perspective may be needed to help determine the software package that best fits your business and its employees.
Focus on automating the processes with the highest return on investment. If a POS program can shift sales and customer information into a spreadsheet and, with a push of a button, analyze the data for trend information, then why dedicate an employee to data entry work? As mentioned above, social media marketing can be automated, too. The focus is to spend resources where they’ll do the most good.
Ensure proper funding. The old saying that it takes money to make money holds true. In order to get the most out of ERP, you must be willing to dedicate the necessary resources to analyzing the need, documenting the processes, purchasing the software, and training the staff. Although each will consume resources, the long-term payoff is growth and increased profit.
Hire outside assistance. An outside consultant who brings in a neutral perspective can more accurately analyze needs and develop processes without the distraction of preconceived ideas and/or personality conflicts. Employees will more readily accept an outside expert’s recommendation because of that very objectivity. The consultant won’t be playing favorites or engaging in retaliation, perceived or actual.
ERP won’t solve all of your company’s problems, but it will spotlight challenges and opportunities. This will allow you to see where skilled employees can be best used, and to accommodate expansion as your business grows. After all, intelligently managed growth is the only growth you want for your small company.