4 Tools That Keep Businesses On a Smooth Path To Success

A successful business is more than a collection of people in different departments. It’s a well-organised team of individuals with diverse skills and backgrounds working together to accomplish four intertwined objectives: acquiring customers, delivering goods and services, recruiting and retaining people, and, hopefully, generating a profit.

Doing these things well — and consistently — is critical for success. Unfortunately, many young businesses fall short in one or more areas: According to the U.S. Bureau of Labor Statistics(opens in a new tab), around 20% of startups fail within the first two years, and nearly half close within the first five years.

External factors, like competitive threats or economic disruption, certainly play a role in some failures. But more often than not, internal issues are the root cause. Miscommunication, inefficient processes, insufficient management oversight, and poor coordination of resources are far more common among struggling businesses than they are among successful companies. Fortunately, many of these problems can be addressed, or at least minimised, with enterprise resource planning (ERP) software.

ERP Essentials

ERP solutions are built around a set of core business functions and help organisations manage their resources to meet the needs of customers. ERP applications are modular and encompass standard processes, like accounting, human resources, sales, and marketing, along with industry-specific capabilities.

Regardless of the vertical, an effective ERP system has four essential components that help companies succeed: a common data repository, automation, internal controls, and business intelligence tools.

Centralised data repository. As companies evolve, they tend to purchase software as needs arise. Over time, they wind up with multiple systems from different vendors, each designed to perform a specific function or support a single department. Because these disparate systems aren’t intended to work together, the data they contain can be accessed by only a limited group of people.

When critical information about customers, orders, inventory, capacity, or other processes is spread across multiple solutions, aggregating it for analysis is a complicated and time-consuming process. This makes it difficult to get a complete picture of what’s happening in the business.

An ERP eliminates these obstacles by incorporating a centralised database that allows data to be accessed and shared based on user needs and permissions. That improves decision-making and communication because everyone is on the same page.

Centralising data access provides additional benefits including:

• Improved accuracy and integrity by standardising data formats and minimising duplicate data entry;
• Increased efficiency by eliminating unnecessary file exchanges and approval delays;
• Reduced support costs by eliminating the need for complex integrations; and
• Improved collaboration by making it easier to access and share information.

Automated processes. Organisations depend on a variety of processes to accomplish their objectives. From sales and operations to purchasing and accounting, processes are how things get done. Each process comprises individual tasks that must be completed; a workflow is the set of steps required to complete a given task.

While every task has an associated workflow — and most companies have hundreds or even thousands of tasks — the steps may not be documented. ERP solutions automate routine processes and document their component tasks, allowing work to be completed more quickly and accurately while enabling managers and staff to focus on higher-value activities.

Automating business processes not only frees up resources for other activities, it also:

• Increases productivity by enabling team members to accomplish more each day;
• Improves communication and collaboration among team members and across departments;
• Reduces errors and rework caused by inefficient manual processes; and
• Improves accountability by making it easier to monitor individual performance.

Controls and compliance. Internal controls are the policies and rules organisations implement to protect themselves from financial fraud; serious errors; and intentional abuse of benefits, resources, or authority. Effective controls assure compliance with government regulations and accounting standards. They also help with effective decision-making regarding capital investments or allocation of company resources.

ERP solutions help ensure compliance with financial standards; operations policies; and federal, state, and local regulations. Review and approval workflows built in to accounting, sales, procurement, staffing, and other processes provide for management oversight that reduces the risk of financial fraud or errors.

In addition to mitigating risk and potentially improving performance, internal controls:

• Improve accountability by ensuring that managers are following established processes;
• Increase confidence in earnings statements and other financial documents;
• Create a culture of compliance to minimise errors and omissions; and
• Reduce audit fees and help companies avoid financial penalties.

Business intelligence. ERP systems provide powerful business intelligence capabilities, enabling users to assemble and analyse data from across the organisation. And while standalone software, like accounting or inventory management applications, may produce only static reports, ERP solutions allow users to design and share detail-rich reports, dynamic personalised dashboards, and custom KPIs.

Making these kinds of analytics tools available throughout an organisation ultimately improves resource allocation by helping managers uncover new revenue opportunities, monitor the results of current projects, and spot inefficiencies that may be costing the company money.

Other advantages of business intelligence include:

• Improved outcomes via ensuring decisions are based on data, not assumptions;
• Recognising quality or performance issues before they affect customer satisfaction levels;
• Increased visibility and transparency into company performance; and
• Actionable insights that help with better decisions.

NetSuite ERP

As companies acquire multiple systems to manage different parts of the business, the result is disconnected workflows and departmental data silos that make it difficult to share information. That adds up to reduced organisational efficiency. NetSuite is built from the ground up to support your entire business, increasing productivity by automating manual process and improving collaboration between departments.

With a unified platform that connects people, processes, and data, NetSuite lets you monitor financial and operational performance across the entire organisation in real time. A unified data model offers employees at all levels controlled access to the information they need to do their jobs, while ensuring sensitive data is protected with role- and user-based permissions.

By making data more readily available, automating core processes, and ensuring proper controls, NetSuite helps companies react more quickly to changing conditions. Instead of getting bogged down by administrative details or a lack of information, leaders are able to focus on improving the business, leading to faster, more informed decisions and a more agile organisation.

To learn more about NetSuite ERP, watch our recent webinar: All About NetSuite ERP(opens in a new tab)