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Can You Keep Your Lead When Others Falter?

May 29, 2008
As we see the economy falter, we as business owners and managers wonder how we can keep it all working smoothly.

Lets start by taking a leaf out of big business. Its often the other way around as corporations look to entrepreneurial businesses for ideas. Back in the late 1980s early 1990s corporations the world over began getting their operations in order. The TQM programs had given way to the implementation of systems. The systems were named MRP and MRP II and for the first time functional areas other than finance had computer programs available to them. Manufacturing was the first, followed by HR, distribution, maintenance and any perceivable name for a department in an organization. This complex array of programs allowed each individual area to plan and operate as efficiently as it could. However it did this with out a care for how the rest of the organization fared!

Enter the ERP. You may well ask; what is it? Well and ERP is an acronym for Enterprise Resource Planning. In a sense what it does, is to allow the scarce resource of finance to flow through the organization in such away that it gave the organization its best possible advantage. The implementation of these ERP packages took on proportions of the Cold War. Corporations spent their war chests on implementing. Literally hundreds of millions of dollars, even billions, were spent upgrading systems.

So what does that mean for small business? You have tried to get a lean program going and worked with a business coach, but still things are not what you believe they should be! Maybe its time to start looking at the place you can make some big time changes!

In this new century there are ERP systems that are affordable for smaller organizations. The biggest reason most SMEs never went the way of ERPs was cost. Not any more. SME companies have begun to realize that their accounting package and various pieces of home grown software developed to link the organizations assets has become a hindrance to growth and success.

Offerings aimed at the SME market are very complex and selection is not that simple. Its hard to justify purely on cost. Prospective implementers need to ensure the software meets their needs, or can be configured, and even integrated with other systems and even linked via EDI or web tools to vendors, all with minimal effort and expense.

There is a choice of -in premises- or -on demand- software. Buying software is not cheap, the initial costs and maintenance fees are compounded by user fees, training, databases, servers, networks and let us not forget IT staff. Even if you outsource the maintenance operations there is still an expense. On demand software is basically rented, and as the name suggests its online. All you need is an internet connection and a PC. The commonly accepted term is SaaS, or Software as a Service.

The Return on Investment (ROI) and Total Costs of Ownership (TCO) calculations for these programs are excellent. Especially if one take the calculation out three and even five years. Year on year there are absolute savings. Oh, besides the obvious; these systems offer the beauty of maintaining current updates and managing your backups. This is your ultimate disaster planning scenario all taken care of!

Selecting s system is not that simple. There are some incredible offerings available and all look tempting at first. The trick is understanding your business, mapping the processes and date flows and determining your needs and the softwares offerings. This analysis can take a few months. Another aspect worth looking at is how many clients they currently have on their systems? How long have they been in business and also who are their investors?

Look at who consults with them to implement the systems or do they do their own consulting? Over the years of working in systems implementation I have found contrary to popular belief, people who implement best are usually not from the software company! Consultants who have done this type of work before and know the questions to ask and the potential risks involved.

So there is a way forward to maintaining and improving on your success, the path has been blazed by the big corporations and its open for your next challenge.

Go out and make it a good one!
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