With changing business scenario almost all the companies are thinking of upgrading their business IT systems. As the organizers have understood the merits and advantages of ERP software, they are keen in implementing ERP as a perfect solution for enhancing their productivity and streamlining their business for scientific management.
Now given the investment that goes into ERP, manufacturers are often confuses whether they should go for a standalone accounting software product or opt for full fledged ERP solutions.
Here are few points that will aid you in making correct decision:
Firstly one must understand what is the difference between the two- ERP software and accounting software? ERP or the Enterprise resource software handles an entire range of business functions covering functional areas like accounts, finance, professional services, automation, human resource, pay roll, inventory, supply chain, project management etc. whereas accounting package handles only accounting part of your business functions.
This means ERP covers all most every area of your business. So before deciding whether to go for ERP or to incorporate accounting software in your business just ask yourself few questions:
1. How many contrasting or unlike systems that you will have to manage?: In case you opt for standalone accounting software you will end up using separate software for managing your leads, customers, partners and vendors and another piece of software to keep a track of your stock and yet another one for managing your projects.
So give a thought that you end up having separate point solutions for managing your one organization. And one of the drawback of having multiple systems for your business is IT management becomes a tough job altogether. And to customize these systems, synchronize some solutions so that they feed each other information makes the entire task difficult and complicated.
When front end and back end systems run separately it can cripple the process that are meant to ensure the smooth running of your company. So for smooth running of business and streamlining all the functional points at one single core, it is advisable to go for ERP software.
ERP software integrates all the functional systems of the business to one single data base. This means you have only one system to worry about and your staff has easy access to the data and duplicated effort is minimized.
2. If planning for business growth: In case you are planning for business growth then go for ERP software. Many accounting packages are great for small and medium business but for large enterprises they fail to cope up with the high volume. So in case you opt for accounting package now and when you plan for growth you may outgrow system capabilities and have to upgrade more feature rich ERP solution at later date as most of the ERP software are scalable and modular in design so that you can continue to expand your system in tune to the growth of your company and requirements.
3. Does staff besides your accounting team need access of certain financial data? If your company has system where in each department has their own separate system to work then in such a case only accounts department of your company can access the financial data. But it is beneficial that members of other departments view certain data that is contained within the accounting software. Say for e.g. sales team want the figures of customer’s payment for last order but if synchronized system is not there they have to go to accounts department to get the information. So with ERP all the information is in the same system and thus each and every person of the organization can see it without disturbing other departments. Restrictions can be set so that each employee has access to information that is needed to transpire their work.
4. Easy report on Key performance indicator: If you want to have key performance indicator data for your business then you need to work out on certain important reports and your accounting software though it tables reports and analytical tools it does not pull all the data together from your organization.
With accounting software you will get only financial data and not other data like stock data, invoice report etc. For comparing sales order with invoice report your financials has to be linked with CRM software and ERP software provides robust reporting tools such and search capabilities as it incorporates all key business data from across the business. With right access one can track any data from any department at one center point and thus reports on key aspects can be created.