As organizations expand, chances are they’ll rapidly outgrow the ERP software systems they had been previously using to manage their operations. Unfortunately, many businesses make the mistake of hanging on to antiquated legacy systems that simply aren’t agile enough to meet their increasingly complex needs.
Companies often continue to run on outdated ERPs because they fear the cost and inconvenience of implementing a new ERP system. Others may have simply neglected to consider scalability when choosing their ERP system, only to realize their error once the business begins to grow. Whatever the reason, continual dependence on aging systems hampers a company’s operations considerably.
To avoid falling into this trap, it’s critical for your business to prioritize scalability when choosing an ERP system. A scalable ERP solution is designed for maximum adaptability and flexibility, so that it can grow alongside your business. Systems like the acclaimed SAP Business One are ideal for SMEs due to their easily configurable nature. They’re entirely capable of keeping it simple while the enterprise is small, but can be modified to become more sophisticated and feature-rich as it expands.
Curious about what a scalable ERP solution looks like and what benefits it can bring to your business? Read on for an in-depth explainer.
What Is ERP Scalability?
Scalability in software refers to a system’s ability to adapt to growth—that is, to handle increasing amounts of work and more complex processes as an organization expands. Though it’s often overlooked by companies, scalability is a must-have quality for any ERP system that an organization intends to use long-term. Scalable ERP systems can be readily reconfigured to accommodate more work or new processes, all without compromising the quality of their output.
Scalable ERP systems enable businesses to avoid the pitfalls of trying to operate with too few resources or overpaying for resources they don’t need yet. Instead, businesses can grow organically at their own pace, confident that the system will be able to handle more users and larger volumes of data in the long run.
Why Is ERP Scalability Important?
Growing businesses often face a host of challenges before they can reap the benefits of expansion. They’ll have to hire more staff, serve more customers, and manage more data and resources than they’re used to. They may also have to introduce new processes to better accommodate their growth. Without proper tech infrastructure to help them overcome these challenges, the operational efficiency of the business and the quality of its products, services, and customer experience may take costly hits. In the long term, the company may face a considerable amount of lost profits and reputational damage.
A scalable ERP can help companies effectively navigate the many complexities associated with business growth. They’re especially necessary for small businesses, as these enterprises are the most likely to see high growth rates over relatively short periods of time. And while business owners might balk at the upfront cost of a robust ERP system, they’ll find that the long-term benefits are more than enough to make up for the initial expense. The additional agility and efficiency a company gains from a good ERP also provide significant ROI right out of the gate.
Sustainable and profitable business growth happens when companies have the resources to boost their technical capacity at an acceptable cost, without having to replace or significantly upgrade their systems. Scalable ERP solutions can make this happen by streamlining operations and automating menial tasks, freeing employees up for more value-adding work and heightening productivity overall. In the process, ERPs pave the way for higher profits and unhindered expansion.
How Do You Know an ERP Solution Is Scalable?
Businesses in search of the right ERP systems can determine if a solution is adequately scalable by considering the following questions:
- Utilization – Can the system handle more data and increased usage efficiently? Can it readily accommodate more users, transactions, servers, and information without breaking down? Is its database structure efficient enough to incorporate additional servers with minimal downtime?
- Number of Users – Does the system allow you to add new users or customers as your business grows? What additional expenses can you expect for granting access to additional users? How easy is it to add them to the system?
- Functionality – Do the system’s functionalities meet company needs, including potential future needs? How easy is it to add new functionalities to the system? What overhead costs should you anticipate? How quickly do these changes take effect?
- Platform – What platform does the system run on? Is it on-premise or cloud-based? In the case of the latter, does it run out of a browser or a dedicated app? Can the system function in many different computing environments?
A high-quality, scalable ERP system will be able to cope with large increases in staff and customer accounts. It should also display data in real time and allow for unlimited data input. Lastly, the system should work properly on any device or operating system to keep your business operations as mobile and as flexible as possible.
Ultimately, a scalable ERP solution is a dependable resource that businesses can leverage for sustainable growth. Once you find an ERP system that’s optimized for your enterprise’s unique needs, your operations will be reliably covered for the long term.
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