Christian Little

small business erp,erp for small business

Commercial organisations need efficient process, the focus of leadership and structure that can stretch to enable the business to grow safely as a massive 55% of businesses fail in their first five years of existence. The commentators offer useless ‘insight’ as to why this occurs. I consistently see three key reasons why this tragedy occurs so often and to so many individuals with different experience, qualifications and knowledge.

The first reason is insufficient market understanding.

No foresight. For example Individuals have the concept, build the product and then sit back and wait for the market to flock and buy. In information age there is no excuse for lack of research before wasting any time and cash on designing a product until you have firm evidence there is a market.

The number two reason is lack of understanding of the basics of business.

The majority of people starting a business know their trade, how to deliver a service or manufacture a product, but not how to run a business. Having the ability to read and track the numbers in the Income statement or the balance sheet is an essential skill. The basic knowledge of accounting is rarely imparted well by the business publications, internet resources and experts with the knowledge such as CPAs and bookkeepers. Companies such as Sage software and Intuit callously hoodwink business managers with their marketing that their packages are the holy grail.

Sage software and other vendors as usual are underserving small businesses.

Until recently ERP software solutions and packages were only affordable by larger enterprises who had figured out that the back and front office systems need to be wired together to give a complete view of the business. One technology business NetSuite had the foresight to see the opening in the market and started selling its small business ERP software. NetSuite pricing has become prohibitive as their product has increased in complexity.

The final reason companies fail is because of lack of process and procedures that provide the vital behaviours and continuity a business must have to work efficiently.