ERP for small business
Posted on November 14th, 2009
Running a business effectively is about organisation, focus and process as a massive 55% of businesses don’t make it to their fifth birthday. The experts offer banal opinions as to why this happens. I continuosly observe three key reasons why this tragedy happens so often and to so many individuals with different experience, education and knowledge.
The primary reason is insufficient market understanding.
No foresight. For example Individuals have the concept, build the product and then expect the market to appear and purchase. In information age there is no excuse for lack of investigation before spending any time and cash on creating a product until you have solid evidence there is a market.
The second reason is lack of comprehension of the basics of business.
A significant proportion of people starting a company know their trade, how to deliver a service or make a product, but know very little about running a company. Being able to understand and track the numbers in the Income statement or the balance sheet is a vital. The basic knowledge of accounting is not very often imparted coherently by the business books, internet resources and experts in the know such as CPAs and bookkeepers. Vendors such as Sage software and Intuit aggressively fool business managers with their marketing that their applications are the cure for all ills.
Small business accounting software is only half of the solution.
Large corporations way back figured out that all of their systems should be joined together to give them a comprehensive view of the business and then along came ERP software solutions and packages. One technology business NetSuite had the foresight to see the opening in the market and started offering its small business ERP software. NetSuite competitors have seen the opening as well and as a result lower cost easier to use systems have emerged.
The last reason companies don’t survive is a because of the absence of good management processes and policies to enable a sustainable fabric of disciplines and behaviours.
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