The intent of any business is to serve customers by providing relevant services or selling products. A large enterprise will have separate teams for product development, sales, marketing, finance, etc. but a small business may not be in a position to have so many decisions.

A small business has to hustle and wear multiple hats so that the business progresses in the right direction. Though it is good to hustle, business owners need to find ways to optimize their business processes. Enterprise Resource Planning (ERP) software can bring much-needed business intelligence for running the business.

ERP is a software/system that integrates all the necessary business functions like vendor management, manufacturing, finance, inventory, etc. in a single package. The advantage of using ERP software is that the blocks in the system are tightly coupled with each other which help in making business-critical decisions.

ERP system facilitates the seamless flow of information across different departments. It is considered must-have software for large enterprises but slowly SMBs (Small & Medium Businesses) are also realizing the importance of ERP software. Whether it is a software startup or brick & mortar business, most of them have to know “What is ERP”? Many small businesses keep a track of sales, inventory, etc. in spreadsheets that are stored in local systems. The approach is neither reliable nor scalable. Also, you cannot make sales forecasts based on the information that is scattered across multiple spreadsheets.

It is recommended to check the features of ERP software before you shortlist one for your business. The software should have support for inventory management, banking transactions, and also have GST (Goods & Services Tax) compliance.

The software should be scalable enough to manage unlimited companies and group companies. This scalability ensures that you do not have to switch to new ERP software once your business expands.

Below are some of the core benefits of ERP software:

1. Decision making based on factual information– Data stored in ERP software is visible to the key stakeholders from different departments of the organization. This data is useful in decision making and identifying potential growth avenues for the business.
2. Increased Productivity– ERP software like Tally.ERP 9 by Tally Software is instrumental in streamlining business processes. This eases the pressure from the employees who used to maintain the data and they can be engaged in other business-critical activities that require human intelligence.
3. Checking business performance– As the business blocks in the ERP system are inter-connected, it provides a clear view of the performance of every business function. This enables the business owner to check which business functions are underperforming so that corrective actions can be taken to improve the performance.
4. Better Transparency – There is more transparency of data once ERP is used within an organization. Departments working in silos can get their voices heard by providing their input to other departments. This helps in building a tightly knit work culture as there is more transparency of information across departments.
5. Scalability & Security– ERP software like Tally.ERP 9 has all the necessary security features so that unauthorized employees cannot access information. This is required since financial information will also be entered in the ERP system and that information should be kept confidential. Good ERP systems have scalability so that it can be used by large enterprises, startups, traditional businesses, as well as, a conglomerate of companies.
6. Reduction of operational expenses– Whether a business is small or big, actions have to be taken to control the operational costs. The approach of having business details in excel sheets can be highly erroneous which leads to re-work thereby increasing the operational expenses. ERP system eliminates the need for maintaining several spreadsheets which in turn helps in lowering down the operational expenses.

Video on ERP Solutions: Tally

This video gives an overview of Tally ERP

Conclusion

Small business owners should evaluate ERP software before choosing the best ERP software for their business. ERP system should be introduced at the initial stages of business development since it minimizes the effort for entering data in the software.

As a small business owner, what are the core benefits of ERP software? Please leave your feedback in the comments section…