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ERP: Real Solutions for SMBs

When it comes to ERP, many companies fail to see the big picture. Gartner’s 2014 report, “Working Smarter, Not Harder Is the Key to Business Success With ERP” suggests a key reason for this is that companies may not know how to recognise or measure the true value of their ERP systems for all the aspects of their business.

The first step in accurately measuring its importance is to understand its value within your company and how ERP can make you more competitive. It can be challenging to get companies to view ERP not only as a technology, but as a competitive business tool that can help them differentiate in the market and support their overall goals and strategies.

According to Gartner’s report, when it comes to making a company more competitive, many CIOs see ERP as often a lower priority than investments such as innovation. I would argue that this is putting the cart before the horse: You first need a solid integrated ERP foundation to ensure that the information that powers new innovative capabilities is accurate and up to date. For example, a company may decide to invest in a mobility app to facilitate anytime/anywhere access, but this will work only if the underlying information driving that is fully up to date and integrated.

So there is a lot you can do with ERP – but of course, not all of it will increase your competitiveness or make you more innovative. Where Illumiti focuses is on identifying what is really core for a company’s business: the things that differentiate it and are mission-critical. We recommend that companies customize only the core pieces where they need to be changed from the standard. This keeps costs down and simplifies implementation so it has a shorter timeframe. Doing this also keeps the ERP implementation more affordable and its focus proportionately more on things that will make the company more competitive.

This is particularly important for small to mid-size companies, many of which tend to be put off by the perceived life-cycle costs of an ERP implementation. While many SMBs believe they can’t afford an ERP, our experience shows that SMBs actually can afford to put in place the solid foundation of a world-class ERP solution that will enable their strategy today without limiting their future growth.

Moreover, it is actually possible to identify the areas of your business that have a high potential for improvement up front, before even beginning an ERP implementation, by using readily available free benchmarking tools (such as those provided by SAP) online. These can help you identify and focus on the areas of your business where you want to see improvement sooner rather than later. We call this “moving the needle.”  SAP Business One provides a great framework for SMBs to get off the ground quickly and affordably.

Lastly, Gartner stresses that ERP must align with business strategy and include a budget for long-term maintenance and support. Building a competency center of key people who understand the capabilities of a company’s ERP system, and who know what it can do and how it can evolve  will help guide any changes on a long-term basis. Those key users are not IT people; they are the actual users who understand the way the customer does business. There is no extra overhead or incremental cost because they are already part of the business. With these users acting as process leads and primary contact points in the business, a partner such as Illumiti can take on the monthly application maintenance and support.

Because ERP solutions typically involve several different functional modules addressing distinct business processes, many different skills are needed. Instead of full-time in-house support, which is quite costly, Illumiti’s application maintenance, enhancement, and support model offers a fixed monthly fee for a selected service level guarantee and an hourly rate applied only to actual approved work performed on customer-initiated tickets, across all relevant solution modules. This makes it affordable, meaningful, and effective for small and medium-sized businesses to get the most out of their ERP solution — right away, and for the long term.

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