ERP Systems: What They Don’t Tell You (Pros + Cons Inside)

Running a growing business isn’t exactly a walk in the park. The more you grow, the more disconnected things start to feel. One department doesn’t know what the other’s doing. And just making a simple decision? Somehow it takes forever.

That’s where ERP (Enterprise Resource Planning) comes in.

ERP works best when it unifies all aspects of your business, including sales, finance, purchase and inventory, into a single, centralised system.

It's not magic, though, and that's crucial. Although ERP has some genuine advantages, there are drawbacks as well. So let's dissect it all before you dive right in.

Advantages of ERP

Centralized Information

This one is significant. ERP systems consolidate all of your company's data in one location. No more requesting the same update from three different teams or searching through disorganised files. Everything is kept and available on a single dashboard, including your sales figures, inventory levels, and personnel records.

When all of your data is in one clean system, you can make decisions more quickly and intelligently. And without engaging in email ping-pong, everyone remains in agreement.

Real Time Analytics

ERP allows you to see what is happening rather than just studying what has already occurred.

Want to see how this week's sales are trending? Finished. Do you want to see the current state of your inventory? Simple. You can track what really matters without waiting for someone to "get back to you" thanks to the dashboards and reporting tools that ERP systems offer.

Such visibility is beneficial and necessary in industries that move quickly.

Process Automation

ERP is going to become your new best friend if your team is still creating invoices by hand or updating stock counts in Excel.

It eliminates the need for human error by automating all those repetitive, routine tasks that waste time. Automated background tasks like order processing, payroll, and restocking allow your employees to concentrate on tasks that truly make a difference.

Time is not the only benefit of automation. Additionally, it reduces stress and improves consistency in your processes.

Disadvantages of ERP

Now, for the part that nobody wants to discuss but should.

Expensive Starting Price

ERP is not inexpensive, let's face it. The upfront costs, which include software licenses, setup fees, training, and occasionally even hardware upgrades, can be extremely taxing.

This can be a significant obstacle for small to midsize businesses, particularly if you are unsure of the type of return you will receive or when you will see it.

Therefore, if you're thinking about ERP, be sure to understand the investment and the expected time frame for results.

Complex Implementation

However, ERP is not a plug and play solution.

An ERP system's rollout can be a drawn-out, chaotic procedure. Planning, testing, patience, and time are all necessary. Many times, projects go over budget, past deadlines, or both, particularly if your internal team isn't prepared for the change.

This is merely a reminder that ERP success isn't solely dependent on the software; it's not meant to frighten you. People, training, and change management are all important.

Customization Challenges

ERP systems are adaptable. That's fantastic. Customisation, however, can also backfire.

What appears to be "just a small tweak" can quickly spiral out of control. More changes equate to more money, more delays, and more development. And occasionally, you wind up with a configuration that is so customised that it is difficult to maintain or upgrade later.

Therefore, while customising the system to meet your needs is crucial, going overboard can backfire. The key is balance.

But the real question is: Is ERP the right move for your business?

Not every company is ready for ERP, and that’s okay.

It all depends on where you are in your journey. Do you need more structure? Are your current tools holding you back? Is your team spending more time fixing things than growing the business?

Checkout: If the answer is “yes” to any of those, ERP might be worth exploring. Find its actual advantages and disadvantages of ERP