How to Implement ERP in Small & Mid-Size Companies


Enterprise Resource Planning (ERP) has long been used by larger businesses to manage supply chains, manufacturing processes, human resources management, and financial analysis. Because of the limited market for large server based ERP implementations, many ERP vendors, including SAP, Microsoft, and SSA Global, previously called Baan ERP, offer software solutions designed to run on more simple hardware for small and medium-sized businesses.

Things You'll Need

  • Hardware and network infrastructure
  • Established, documented business processes
  • Time for employee training

Define your business processes. By defining your business processes in writing, you will be better prepared to select a software vendor based on your business requirements. Establishing well-defined as-is business processes can also help you decide if changing a particular process to suit an off-the-shelf software solution is cheaper than paying for custom software for a particular process.

Contact a number of different ERP solution providers. They will ask for defined business requirements. You will need to define the areas of your business that will operate under the ERP system. Common areas include finance and accounting, supplier chain management, warehousing, and manufacturing. Request proposals from them for solutions to your business requirements.

Review the proposals. Some suppliers may offer prices that seem initially high. If a particular system seems well suited for your business, but the price seems high, check to see if they are creating custom modules for your business. If they are, the costs for custom modules are usually higher than existing modules. Explore the possibility of re-engineering your business processes to fit an existing module. In some cases, the costs of re-engineering the processes will in lower software costs for the ERP system and in lower overall operating expenses.

Select an ERP provider. The best provider for your business will depend on both the type of business you are in and the areas of your business to be run under the ERP system.

Begin the training regimen recommended by the ERP provider. Early training will likely include training on the recommended hardware systems for the ERP system. Later training will likely include how to customize and operate the ERP system.

Install the hardware and networking required by the ERP system. Simple ERP systems can run both the software and database on a single computer or server. More complex systems may require separate software and database servers.

Install the software on your newly installed hardware systems. Most ERP systems for small and medium-sized businesses are end-user installed with consultation from the manufacturer.

Configure the software to suit your business processes. In some cases, you may need to make minor adjustments in your business processes to suit pre-configured ERP modules.

Train employees on the new system. ERP can range from the very simple to the very complex.

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