Necessity of Enterprise Resource Planning Systems for Small and Medium-sized Enterprises

Abstract

For small and medium-sized enterprises (SMEs), the advantages of ERP systems are obvious. Many small businesses initially use different software and applications to manage each business process, such as separate programs for invoicing, finance, sales, etc. However, these programs are not integrated with each other, which can cause problems such as data loss between different databases, errors caused by manual data entry, and time-consuming manual processes. However, ERP systems provide a single, integrated system that connects all important business processes, reducing data loss and errors. With the help of an ERP system, businesses can manage finances more efficiently, implement more consistent sales and marketing strategies, better plan and organize production and logistics processes, and manage human resources more effectively. However, ERP systems also have some disadvantages, such as implementation costs and time-consuming implementation. In addition, businesses should choose an ERP system according to the number of their staff and the complexity of their processes to best suit their needs. The efficient operation of small and medium-sized enterprises (SMEs) and the growth of their performance is facilitated by the use of various technologies/techniques. Covid19 has highlighted even more the importance of using these technologies - which differ from sector to sector - but at what point during the company's life cycle does an SME reach the stage where it already needs a complex, integrated business management system ERP?