7 Signs You Need an ERP System

What Are The Signs You Need an ERP System?

There is no doubt that purchasing an ERP system is a major investment for your business, so how do you know when the right time is to undertake such a project? It’s common for start-ups and small businesses to use financial software such as Xero, QuickBooks, or Excel spreadsheets at the beginning. These are great at the start but as your business grows, the manual processes can become unmanageable and the limitations of your current systems and processes rare their heads…

Here are 7 tell-tale signs that it’s the right time to implement an ERP system.

1. Outgrown Current Software

The market is always evolving, with that brings changes in legislation, politics, and environment. There are several signs you might have noticed suggesting you have outgrown your current system. Firstly, if you are now looking to other systems to perform processes that your existing system was previously doing, it’s time to make a change. Secondly, if your supplier has stopped issuing updates to functionality and is now only issuing bugfixes. Finally, in some cases, you might have surpassed the number of orders your system can process. Sage 50, for example, is built for 50 users and up to 1.5 million transactions, while Sage 200 allows up to 200 users and 9 million transactions. Once you’ve reached your maximum order processing, it’s a clear sign you’ve outgrown your system.

With that in mind, it is crucial to find a scalable solution which will grow with your business. Oracle NetSuite, for example, is an ERP system which has been designed to adapt to periodic surges and spikes of usage, and to scale upward seamlessly to address a magnitude of increased transaction volume.

2. Inconsistent Data

When your separate systems don’t “talk” to each other you find inconsistency reflected in the data you extract for reporting. Perhaps your stock levels in your ecommerce website aren’t accurate to the inventory listed in the warehouse. An ERP is one unified source of data and therefore can avoid the inevitable human errors caused by lengthy manual processes.

If your team is spending significant time fixing the discrepancies in data, it may be time to replace your current systems with an ERP which will integrate all your processes to ensure accuracy.

3. Disappointed Customers

At the end of the day, it’s most important that your customer is happy. In many cases, a frustrated customer is triggered due to the failings of inadequate software or processes. If your software creates barricades to your efforts to provide exceptional customer service, you will notice a decline in customer loyalty subsequently.

ERP systems that include a CRM, like NetSuite does, enable storing of all customer data, contacts, and history in the same system that POs, orders, invoices are also generated from, so it makes the customer experience side of the business streamlined.

4. Month-End Financial Reporting is Tiresome

Nobody enjoys the task of preparing reports, particularly not when it’s a time-consuming, manual task which takes your focus away from other pressing deadlines. The monotonous task of month-end reporting can be automated by implementing an ERP.

ERP systems like NetSuite allow you to identify data accurately and then turn this into the standardised reports required for your month-end or year-end meetings. With one less thing that requires the focus of your employees, resources are readily available for other tasks that provide greater value.

Our customer, St Andrews Links, identified this as a major influence for their decision to implement NetSuite, “At month end we previously had to send on monthly reports with various narratives to support them. Now department heads will access and tailor their own reports via NetSuite. The time and effort this will save at our month end is a big win.”

5. Rapid Growth Plans

If your business has grown rapidly, then your systems may be under a pressure which they cannot handle. Perhaps you’ve added a new product or service variety, expanded to new geographical territories, or set up new subsidiaries. Significant changes like these will require different business functionality within your software. If your current solutions can’t cope with multi-currency accounting, international taxation, or consolidating accounts across different subsidiaries then it’s time to make a change.

The right ERP system will be flexible enough to adapt to any new requirements and provide a stable base for the growth of business.

6. Manual Processes

Without an ERP system in place, your team will have an extensive amount of manual work. The process of extracting and reviewing information from various spreadsheets to curate reports can be lengthy, cumbersome, and ultimately inadequate for your employees.

Having an ERP system will enable the automation of many of your business processes. NetSuite, for example, enables automation of the complete procure to pay process, making the day-to-day much less painful.

7. Real-time Reporting

With the current fluctuating economic situation, real-time visibility can be crucial for your business’ response to the uncertainties facing the market. Without an ERP you will have to wait an extended time for reports to be manually made, and once you receive these the data may be out of date. This will ultimately hinder your need for increased planning for budgeting, and forecasting, resulting in delayed or potentially inadequate responses in tumultuous times.

To compete, your business needs a modern ERP which is designed for today’s needs, instead of the needs of the past. The ability to access real-time figures will place your business at a competitive advantage and will enable your staff to focus on more pressing tasks rather than spending full days collating data to compose a report.

If you recognise any of these signs within your own company, it’s time to consider implementing an ERP system. However, you should note that not all ERP systems are created equal, and it is important to select the one most suitable for your business, along with an implementation partner with a strong track record with businesses comparable to yours. One place to start would be to have a discussion with the Eureka Solutions team about your possible options. Eureka Solutions are in quite a unique position as leading partners of both NetSuite and Sage, as well as being system integration experts, so are well placed to assess the best fit. Get in touch today to have an initial business consultation or to schedule a demo.