3 Biggest all-time ERP Myths - CloudFronts

3 Biggest all-time ERP Myths

Introduction:

In my personal experience over the years, whenever I dealt with business owners, directors, and CTOs in the technology conferences and events, I come across many of them who always hold some misbeliefs about the Enterprise Resource Planning or ERP system. This persuaded me to pick and share some experiences and demystify topmost 3 myths regarding ERPs in this blog.

Myth #1: Ah! ERP is expensive!

The primary concern for any company prior to implementing ERP is its cost. But contrary to the belief, there are tons of other ERP solutions available in the market which are affordable. This sounds like a paradox, however; low-cost ERP system brings along the same impact to the firm as compared to high-cost ERPs. Many enterprises here fail to realize that choosing a right ERP partner is as much as important as selecting an ERP.

Firstly, there are thousands of ERP software providers who may offer variable packages depending on the usage. Different ERP modules are used as per the different needs and requirements.  For example, few ERP software as a SAAS solution or Cloud solution reduces the entire cost of acquiring a whole new ERP for your business.

Several factors like below contribute to the cost of an ERP.

1. ERP Development cost

2. ERP Implementation or customization cost

3. Cost of Licensing and finally,

4. Annual Maintenance cost

The above costs can be drastically reduced by essentially considering planning and methodology which will result in optimizing the resources working with the ERP implementation.

Here a choosing a right consulting partner would guide you perfectly into selecting a right ERP as per your business needs.

Myth #2: ERP is not my cup of tea! It’s for Big Businesses!

Although ERP systems are typically well known in the big enterprise domain, there are plethora of small and medium enterprises across the globe who are actually leveraging ERP system.  This is solely dependent on the variations of the ERP system that you choose to deploy. While it was a case a few years ago, that the ERP systems are more applicable to larger firms, it’s not applicable today given the similarity in the nature and scalability of operations. Today the world and market place is growing at a pace and to gain competitive edge, several small and medium organizations are making use of the latest technologies.

To deal with those large organization, small and medium enterprises need to have a digital technology that can help them overcome problems faced during daily operations. For example, in a country like India, there is a diverse base of SMEs which need to benefit from the technology.

The best example here can be of a company called ‘FarmLink’, which is backed by Swiss company called Pioneering Ventures. It is impressive to see how this agro startup focused on modernizing and transforming the supply chains across the Indian geographical region. Their key challenges were related to the handling of Supply chain operations, Inventory and vendor management, Provide them reports and easy to use dashboard.

Post deploying a suitable ERP system, their entire operations was automated from inventory management to vendor management, generation of deep and critical insights due to reports and dashboards enabled them to execute faster and accurate decision making. The software was also implemented with an easy-to-use smartphone interface for the sales team.

Hence it is just a myth that ERP software is only for big businesses and not for small and medium enterprises.

Myth #3: ERP? Oh no! It’s too complicated!

Many business owners, managers, and high-level executives have this fear in the mind that the ERP deployment might change the course of their regular tasks and disrupt the whole rhythm of the everyday operations. However, this is just not the case! An ERP is an enterprise, resource, and planning technology. It is developed with the fact in mind that numerous companies should be able to implement them easily and commence its operations flawlessly. The complexity of the ERP depends on range of factors such as the number of users, the degree of customization, size of business etc.

Although its successful implementation requires a commitment from the system users, right training from an ERP provider is essential to ensure its smooth running.

Hope the above myths are now eliminated and I would be happy to respond to any of your queries.


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