As a Chartered Accountant, my background is quite different than the consultants I work with at Fenwick. During my career I’ve experienced first hand the frustration of trying to work within the constraints of an accounting system. System deficiencies have caused me to work many late nights creating reports that the system was not capable of producing.
Below are some of my observations which I believe are common indications that you have outgrown your accounting system.
Inability to handle multiples and growth
Whether it’s multiple locations, entities, companies, multiple currencies, systems, or languages, more complex company structures and businesses require more complex systems.
Many businesses start out quite simple, but as they grow and expand their operations, complexities creep into day to day activities. These are often very challenging for existing systems to cope with.
Examples of these complexities may include:
- Expanding into overseas markets: can introduce the requirement to account for foreign currency transactions;
- Establishing foreign operations: may need to report in an additional currency;
- The acquisition of an additional warehouse: will need items to be accounted for in multiple locations;
- Staff in foreign countries: they may need to access information in their native language.
Successful businesses do not usually start out with a need for a sophisticated Enterprise Resource Planning (ERP) system, they develop the need over a period of time as their demands for information evolve. Sometimes the increasing inefficiencies resulting from growth go unseen by a business, to the point where new positions are created to ease the workload of staff bogged down in processing manual transactions – processes a well implemented ERP system could do automatically.
Data duplication and double entry
It is common for businesses to have multiple mini-systems running, due to the lack of functionality available in an accounting system. However, this creates the problem of repeat work and the duplication of data entry required.
Sometimes the development of an interface between the systems is the only solution to avoid data duplication; other times this may not be practical. This data duplication leads to incredibly inefficient use employees’ time, not to mention that it can be demotivating and may affect overall employee retention.
The need to reproduce data that already exists in one system is avoided with a fully integrated system.
Data access & reporting
Another common issue that a business can lose sight of is the amount of time staff spend searching for information in the accounting system.
Time spent searching for information adds no value to a business; analysing information is where you reap the benefits. If you spend more time searching and compiling data than analysing it, it might be time for a change.
Entering all the information into an accounting system is relatively easy; extracting that information to provide meaningful reports is often much more complex and sometimes beyond the capabilities of simple accounting systems.
Growing up on a system
At Fenwick, it is not uncommon to be approached by a prospect that has ‘grown up’ on MYOB, with separate systems to handle payroll, warehouse, manufacturing, distribution, and operations. The benefits in efficiency and cost savings of integrating disparate systems into one ERP system can be enormous.
Our customer base is filled with case studies and testimonials from customers who have been through this experience and would not look back.
These are only a few common triggers that indicate whether you should be beginning the search for a new system. If you are reading this article then you too may be on the path to discovering what a new ERP system could do for your business.
Contact one of our trusted advisors today to explore these ideas, and see if Microsoft Dynamics 365 Business Central is suitable for your business.
