If your manufacturing and distribution business is growing, you’re likely excited about all the positives: ordering is up, there’s opportunity to increase employee headcount, perhaps add another branch or location. But growth can also make some of your “business as usual” more challenging, especially if expanding means the potential to grow out of your current ERP accounting software.
Clues That It’s Time to Upgrade
Just like your physical business location might need some modifications to keep up with your business’ growth, your accounting systems need upgrading as well. Take a look at these six signs. Do any of them sound familiar?
- Manual processes and Excel spreadsheets
- Your team is spending most of their time completing menial tasks in accounting
- Certain advanced facets of manufacturing and distribution are impossible with current systems,such as work order planning, scheduling, costing, reporting, barcode inventory, COGS, etc.
- You lack visibility into your finances
- Inventory management is challenging; you either find yourself running out of material or overstocking your supplies, tying up cash
- Invoicing takes too long, slowing cash flow
If you are experiencing any number of these signs, it might be time to seriously think about moving to an Enterprise Resource Planning (ERP) system. Adding an ERP accounting software such as SYSPRO will allow your business to integrate and manage many key business processes in real time, increasing productivity and reducing redundancies. Upgrading to an ERP will unlock many benefits, ultimately allowing you to move your business to the next level.
How You’ll Benefit From ERP Accounting Software
ERP accounting software gives you a holistic view of your operation so you can easily review all available information and make informed decisions. With a thorough understanding of your business situation, you can more make more strategic decisions. According to Dan Holme, director of product marketing for Yammer, SharePoint, OneDrive, and Stream: “The only way to avoid disruption is if the information is flowing as fast inside your company, as it’s going outside your company. Because if it’s going faster outside your company, and a competitor responds faster than you do, you’re gone.”
Efficiency in Data Automation
With an ERP, you no longer tie up resources in manual accounting and data entry. System information is updated in real time across the business. The same data can be transferred throughout multiple layers of the operation. This eliminates costly mistakes and saves you time and money by reducing the need for multiple steps in data entry.
An ERP forces a business to operate in a standard manner. The processes are clear and result in a reduced dependence on a single person and the “tribal knowledge” they have developed over years of work. When processes are standardized, they can be better optimized.
Ability to Optimize Across the Operation
ERP accounting software reaches almost every part of a business. Because of this, you are able to better understand where inefficiencies occur across your value stream (akin to a form of value stream mapping). The centralization and standardization of data is extremely valuable for cross-departmental collaboration.
With an ERP system in place, you will gain much better control over your supply chain. An ERP allows you to forecast demand, manage inventory levels, and improve procurement, resulting in the right inventory at the right time. Better control over your supply chain leads to better cash flow and increased profitability for the business.
Easier Regulatory Compliance
ERP systems use best practice finance processes, making compliance much easier. The data is secure and validated across your platform, and an ERP has many built-in financial reports that can be generated automatically. These features can save you a ton of time and hassle in meeting financial reporting requirements.
Ability to Scale the Business
With more growth, your operation will likely get more complex; you don’t want your software holding you back. A good ERP accounting software will facilitate the expansion of your business by adding functionality such as new processes, new customers, or new products. It will also be flexible to adapt to your changing needs as a business. Software scales up better than people do.
How to Plan for and Implement Your New ERP Accounting Software
As you decide to implement an ERP solution, planning appropriately is key. Planning can be very involved, but these are some things you will need to consider to get started:
- Budget: ERPs range widely in price based on features and customization needs. Be clear on the costs associated with an ERP purchase. The biggest variable here is consulting costs.
- Resources: Like any major project, if your company and the ERP vendor do not commit the proper resources to an ERP implementation, it will struggle and most likely fail. Be sure to appoint an experienced project lead.
- Change Management: Your standard practices will be changing with the ERP. Are your employees on board with this change, and is there a plan to proactively address their concerns?
- On Premises Cloud Solution: You will need to determine if your network infrastructure can support ERP, or if you want to pursue a cloud architecture. (Or even a combination of the two.) Both have their advantages and drawbacks; it’s important to get the one that will best suit your needs.
- Vendor Selection: The selection of a vendor is extremely important. Does the vendor have experience in your industry and with the challenges you face? Service and support will be crucial both early on and in the years to come, so a local vendor almost always has an advantage. Do not simply pick the cheapest option.
As your manufacturing and distribution operation grows, your systems need to grow, too, in order to support your business. With the implementation of an ERP system, the doors are open to successfully transform your business, but careful consideration and planning must be done to ensure success.
Time to Upgrade? Call PositiveVision
If it’s time to upgrade your business systems, PositiveVision can help simplify your processes with one integrated ERP system like SYSPRO that meets your needs. As a long-time technology partner in the Chicago area, we have helped hundreds of companies upgrade their accounting systems for growth. Let us help propel your business to the next level. Contact one of our experts now.
Not sure if it’s the right time for an ERP system? Read this whitepaper to learn more about investing in new systems and how to choose the right one for your particular needs.