Organizations need to have system that can manage all the activities for the smooth functioning of the business. Enterprise resource planning (ERP) is a business management software related to the real-time collection, storage and interpretation of data for core business processes. ERP integrates various organizational systems and facilitates information flow among all business functions, with the aim of error-free transactions in production.
ERP software is a multibillion dollar industry, with ERP systems becoming more common in small and large enterprises. Even after its popularity there are lot misconception about ERP. Let’s look at 5 of the biggest myths about ERP software
Myth #1: ERP software is too expensive
Most ERP software does not often work as a box product it has to be customized based on your requirements. Some high end innovative ERP software can be too expensive for companies with limited budget. technical advancements such as mobile and cloud computing are expected to make ERP software more affordable. Also, some ERP software companies may offer variable pricing packages depending on usage.
Myth #2: ERP is only for big Business
There is a misconception about ERP Software that is required for only larger firms, but that not the case smaller firms also require ERP system due to the increasingly growing options for customization through technological innovation. ERP solutions come in various forms and features. Choosing the right ERP solution, whether the business is big or small, is vital for long run.
Myth #3: Start with cheaper software and then switch to an ERP in a few years.
The thinking seems logical. You start with a cheap software solution to manage your business in the beginning with whatever you can manage with that and later get a full ERP solution to handle everything with the money you save in that time frame. When you do that, you are essentially putting money into a system that you know will be replaced one day and you spend time implementing it, which will all be a waste your time and money. In the long term, the negative impacts on the company with the limited capability will be clearly visible and affect the bottom line in one way or another. It is better to invest the money now in a good ERP for a long run so that it goes toward the final solution and you can see those benefits sooner.
Myth #4: ERP takes too long to implement
The time required for an ERP implementation generally will be based numerous factors, such as the size of the business, the number of users, the degree of customization, the amount of data migration, and the availability of resources. When the requirements is less and there is no customization, ERP can be implemented within a month or two. Successful implementations, therefore, could require a commitment of several months to a couple of years depending on the above-mentioned factors.
Myth #5: Support is a secondary thought.
This is a big mistake. Companies like Nike, Hewlett-Packard, and Hershey all experienced failed ERP implementations because of poor support and management. Ensuring that there is good support team available and, they provide user training up to your satisfaction is equally important as the actual implementation. Spending all the time and money to implement only to have the ERP fail due to support and training issues is not only costly, but also embarrassing.
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