To ERP or not to ERP, that is the question

28 Jan 2015, by Brian in Developer

What is ERP and why should small businesses consider using it?   Isn’t there enough complexity to starting up or growing a business to have to worry about big, complicated enterprise software?   After all, ERP = Enterprise Resource Planning.   The label “enterprise” usually attaches itself to larger organizations, but that shouldn’t scare us away.   Let’s consider the question.

ERP is designed to bring all aspects of a business together under one “roof” using one database.

Well, the fact is that ERP is not for every small company, and like every good business decision we should identify the problem to be solved.  In this case, it’s all about data.   Where do you store information about customers, sales, time spent on projects, accounting information, employee records, or product information?   Many data-driven companies use a hodge-podge of systems that specialize in those areas or something homegrown, like Excel spreadsheets or custom software.  But those disjointed systems don’t integrate and can lead to missed opportunities or bad data.

Having all your company data on one place has some important benefits.  Going to just one place access everything is convenient.  You might also say it’s more secure because you can’t misplace a stray file and you only need to backup and secure one system.  But perhaps the most compelling is connecting different various data to produce insights into your business.

For small business, ERP should be considered when business units need business process collaboration and data from different areas need to be integrated.  Don’t be afraid of larger vendors’ solutions either….there’s no rule that you must use every part of the system.   Our small business (15-20 employees) uses Microsoft Dynamics AX.  The way we use it is a topic for a different post, but needless to say we only use certain modules and not even some of the core pieces.   There are several other good options using a SMB-friendly subscription model, such as (not a comprehensive list by any means):  — open source web-based ERP with subscription hosting  — transaction-based pricing could be more affordable for SMBs
Odoo  — cloud-pricing on ala-carte menu of integrated suite of apps

What software runs your business?