ERP for Service Industries: Why You Need More Than a Basic Accounting Solution
The common misconception that companies that do not move a physical product can survive and thrive with just a basic accounting solution is keeping many in the services industry from implementing a complete ERP solution.
While a services company can survive without an ERP solution, it cannot thrive without one, and here’s why: companies today must efficiently manage their operations from start to finish, therefore a complete solution that will give you real-time visibility into performance and into growing your business profitably is needed. Also, your customers businesses may be subject to changes due to new, innovative products or new business models, creating the need for new and different services.
While it would appear that the business of delivering services hasn’t changed all that much, leading service companies to think that they can get by with the same old solutions they have always struggled with, here are some key questions to consider:
- How does your company manage, deliver and invoice for services?
- Do you manage your projects in one system and then turn to a separate system to invoice and manage cash?
- Do solutions you have run on older technology?
- Do your orders and/or contracts still reside in spreadsheets?
- Do you have a clear picture of margins and profitability?
- Are you managing projects and resources effectively and efficiently?
- Can you manage your cash flow?
The answers to these questions may lead you to recognize the need for more than a basic accounting functionality. If your company is not using an integrated and streamlined solution such as cloud ERP to manage operations, you are most likely making business decisions with incomplete, or even wrong data and wasting a lot of time.
Many service companies spend much of their time pointing out the deficiencies of processes and technology to their clients, while they ignore their own. In a study conducted by research firm Mint Jutras, 70% of survey participants in service industries claim to be either close to being “digitally prepared” or already there, but many service companies (55% to 74%) still rely on spreadsheets or paper and manual efforts in planning and managing activities crucial to service businesses.
The plain truth is spreadsheets have a high percentage of errors and simply do not give you the safety, efficiency, real-time visibility, checks and balances and the audit trail that is built into an integrated suite that provides the full system of record of your business. If you do not have a solution that gives connectivity and visibility into your operations, it’s time to implement a full-fledge ERP solution.
Relying completely on paper and manual transactions in today’s digital economy is cause for alarm. If you are making do with an old, outdated technology, your company cannot thrive in today’s business environment. Competition is growing and intensifying on a global scale. You need a solution that give you a competitive advantage and provides you with specialized functionality required for services.
Speak with us today about what ERP solution best suits your service organization.