Wisdom from a small business owner – Why small business ERP is key to your survival
Companies need efficient process, the focus of leadership and structure that can adapt to enable the business to grow safely as a massive 55% of businesses don’t survive the first five years. The observers offer shallow explanations as to why this occurs. I consistently see three key reasons why this tragedy happens so often and to so many people with different backgrounds, education and knowledge.
The primary reason is lack of market understanding.
No foresight. For example Individuals dream up the idea, create the product and then expect the market to appear and buy. In this connected age there is no excuse for lack of investigation prior to spending any time and cash on building a product until you have firm evidence there is a market.
The number two reason is lack of understanding of fundamental facts about business.
A significant proportion of people starting a business know their trade, how to offer a service or make a product, but know very little about running a company. Having the ability to read and follow the balances in the profit and loss or the balance sheet is a vital. The basic knowledge of accounting is not very often imparted well by the business manuals, online resources and experts in the know such as CPAs and bookkeepers. The problem is made worse by greedy and short sighted vendors such as Sage software misleading the market by selling only a portion of the functionality actually needed by small companies.
Sage software and other vendors as usual are underserving small businesses.
Until recently ERP software solutions and packages were the privilege of larger enterprises who had deduced that the back and front office systems need to be wired together to give a comprehensive view of the business. One software developer NetSuite had the vision to see the gap in the market and began selling its small business ERP software. NetSuite competitors have since emerged.
The third reason companies don’t survive is a because of the lack of practical management processes and policies to enable a sustainable fabric of disciplines and behaviours.
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