Message to SMEs: You don’t need to jump in at the ERP deep end
It’s always been a mystery to me why so many small and medium businesses rush down the route of buying and installing an Enterprise Resource Planning (ERP) system.
The truth is that the vast majority simply don’t need one.
What they really need is a fully functioning Customer Relationship Management (CRM) platform, which reduces complexity, improves efficiency and saves money,
compared to having an ERP system.
At its heart, ERP is about managing finance and accounts, particularly for companies handling lots of physical products, with supply chains and warehousing, plus
a bit of HR and other general business management functionality.
It is generally provided by the big boys, such as SAP and Oracle, for larger companies and corporates, those with complex finance requirements, such as high volumes of
invoices, with global operations and billing across multiple currencies.
Secondly, they are selling physical products, often 100s of thousands of different products, with multiple suppliers, supply chains and stock control requirements.
Most SMEs won’t ever fit into this bracket.
The other key point is that ERP does what it does: you can configure it, but not really change it much, without writing complex code, so it’s not particularly flexible.
Most of the SMEs that we work with don’t need ERP, they need a well-built Microsoft Dynamics 365 CRM (or Power Apps) system, tailored for their business processes,
with perhaps an integration into a cloud finance system, such as Sage or Xero, if required.
They are looking to manage sales, marketing and customer service, with a degree of flexibility in how the system is customized for their business.
It is, of course, possible that an SME grows significantly (it’s what we all dream of) and eventually they may need an ERP tool as well as their scalable CRM.
For example, we have an e-commerce client that started with a good purpose-built online store platform, with sales being imported into their Dynamics 365 CRM (via an integration that
created for them), for onward service delivery processing and customer service. As they grew, they added on Dynamics 365 Business Central, Microsoft's mid-market ERP
system, for their ever expanding warehousing and supply chain (and finance) requirements.
Microsoft Dynamics 365 CRM and Business Central can happily work together, as they sit on the same Microsoft Dataverse database layer, making intergration between the
two systems much easier to implement.
But the key point here, is that the ERP capability came later on, when it was necessary, not at the start of their journey back in about 2010.
Let’s have a discussion about your business requirements before you jump in at the ERP deep end.
About the Author
Founder | Business Solution Consultant, Solutions Shared Ltd