How big corporations are denying small businesses erp software

Running a business effectively is about organisation, focus and process as a massive 55% of businesses don’t make it to their fifth birthday. The experts offer useless ‘insight’ as to why this happens. I continuosly observe three key reasons why this tragedy happens so often and to so many individuals with different backgrounds, qualifications and skill.

The first reason is lack of market comprehension.

No foresight. For example People dream up the idea, build the product and then sit back and wait for the market to flock and buy. In networked age there is no excuse for lack of investigation before wasting any time and money on creating a product until you have firm evidence there is a market.

The second reason is lack of understanding of fundamental facts about business.

The majority of people starting a company know their trade, how to offer a service or build a product, but not how to run a business.  Being able to understand and track the numbers in the Income statement or the balance sheet is a vital. The basic knowledge of accounting is not very often imparted well by the business manuals, online resources and experts with the knowledge such as CPAs and bookkeepers. The problem is worsened by greedy and short sighted technology companies such as Sage software misleading the market by selling only a portion of the functionality actually needed by small companies.

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

Until recently ERP software solutions and packages were the privilege of larger enterprises who had deduced that the back and front office systems need to be joined together to give a complete view of the business. One vendor NetSuite had the vision to see the gap in the market and began selling its small business ERP software. NetSuite pricing has since increased and put their technology out of the economic reach of small businesses.

The last reason companies don’t survive is a because of the absence of well thought through management processes and policies to enable a sustainable fabric of disciplines and behaviours.

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November 22, 2009 · Filed Under Business and Management

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