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The Pros and Cons of Enterprise Resource Planning

There is no arguing that technology can improve efficiency and profits for just about any company.  Of course, you also have to admit that there are pros and cons to making any kind of major change in the way you conduct your business.  Implementing Enterprise Resource Planning (ERP), for example, is definitely something that most companies should consider right now, but that does not necessarily mean it is the right time to implement it.


Not all ERP systems are the same, but when you find the one that works for your IT team, it can really make that department’s job a little easier.  Be sure to include the head of your company’s IT department in the ERP selection process as they are going to need to understand how it works (for the purpose of troubleshooting in the future, if you need it).

CON:  ERP is a big investment

Of course, making this kind of change will cost your company some money.  This is an investment, of course, as it should pay off in the form efficiency improvements later.  But that is only if you are able to bear the risk.  If you dive into these additions before you have the capabilities, it could take longer to reap the rewards.  That doesn’t mean you should not consider it; only that you should make sure you are prepared for it when you do.

PRO:  ERP is expandable

Today’s technology needs to be scalable: it has to have some elasticity, some flexibility that can quickly change in today’s fast-moving environment.  The good news is that ERP is certainly flexible; and the better news is that ERP gets better as you add more features. That means you can start with something simple—that you can afford—and continue to tack on more and more features as your needs require (and your budget allows).

CON: ERP customization can be confusing

Not surprisingly, though, as you add more and more features to your ERP system, things can start to get more and more confusing.  The more options you add, the more information and processes you will have to maintain and control.  At some point, then, many companies realize they have to bring in an ERP expert to oversee the expansions and the management of their ERP system.  That can also cost money, but is a necessary expense.