Every business requires some sort of accounting and financial software package to function, whether it is the latest full accounting suites provided with ERP packages, spreadsheet programs with custom logic, or an old fashioned paper ledger. Many small to mid-sized businesses typically employ basic accounting packages intended for retail or “mom and pop” operations well past their intended range of functionality. Essentially, as your business grows you must also consider the inefficiencies that arise from not having an ERP finance accounting package that can accommodate your growing business. Some of the key indicators to watch for are discussed below.
MANUAL PROCESSES
For many growing businesses, the thought of upgrading to a full ERP finance package and realizing the benefits of financial integration may not even be apparent to you. It is an all-too-familiar scenario; over the years, you and your team develops various workarounds and jury-rigged solutions to accommodate the lack of certain ERP finance program features in haphazard ways that simply become ingrained into everyday life. You may have gotten so used to these homegrown “fixes” that you may not even think about the better options available.
A key sign of this type of behavior is excessive manual processes. Specifically, as your company reaches the functional limits of it’s financial packages, you may create custom Excel spreadsheets to either arrange custom data or provide reporting that current systems may not provide. This type of manual process can be an extreme pain, and a huge time-waster – and Time is Money, especially when it comes to business finances. If you can think of several “nightmare spreadsheets” currently in use by your company, then there are ERP finance upgrade options that may be worth looking into.
INADEQUATE REPORTING
Outdated or outgrown financial packages for business tend to show their weakness through a growing inadequacy in reporting to meet the needs of your business. Specifically, old or limited software typically lacks or has limited capabilities for real-time analytics, role-based reporting, and in giving summary reports before the current period is closed out.
A key indicator of your business having inadequate reporting is directly connected to when your business grows. Oftentimes, business growth leads to an increase in business structure to include multiple locations, manufacturing sites, and perhaps even corporate entities; all of which is virtually impossible to support on aging and overly simplistic software. An upgraded ERP finance package or full suite is typically necessary when your business experiences a growth spurt, and it’s better to plan ahead than trying to play catch-up.
GREATER INTEGRATION
Particularly for manufacturing businesses, if you are using an independent financial package in conjunction with other software for warehouse management and other processes, you may encounter increasing inefficiencies that arise due to poor integration between systems.
An key indicator of this issue is when inventory management, shop floor manufacturing and accounting are all separate systems with no interaction. The result is that numerous employee hours are wasted coordinating and manually entering inventory and production data into the limited finance accounting system. This is doubly dangerous as not only are valuable labor resources being tied up performing tasks that can be easily automated, but the sheer number of tasks that would need to be completed manually invites a much greater risk for accounting errors that are simply not present with a fully integrated and automated ERP finance solution.
ERP FINANCE AS A SOLUTION
These are just some of the major indicators that an outdated or limited accounting solution may be lacking and would benefit from a different approach. Specifically, an ERP system with a full-featured and integrated finance module would essentially be able to mitigate all of these negative drawbacks and risks by automating many of your finance processes. An ERP finance suite would provide increased and on-demand reporting, as well as fully integrating all aspects of your business under one software package – in many cases while also being able to integrate with third-party software.
The first step in business finance improvements is to recognize that there may indeed be business processes in your own financial operation that would benefit from the introduction of an ERP system. From there, you can begin the investigation and selection process to move towards cohesiveness and efficiency with a new ERP finance solution.Tags: accountingerperp accountingerp accounting packageerp accounting suiteerp financeerp finance packageerp finance suitefinance