In our previous installment, we revealed that SAP chose Torelli Bicycle Co. to be the recipient of a brand spanking new enterprise resource planning (ERP) solution because Torelli is, in fact, pretty typical. It's a little counterintuitive, I know. But when it was explained by Mike Coleman, SAP America Vice President for North American Distribution, Direct Marketing Resellers (DMR) & E-Store, it begins to make sense.Coleman said that Torelli was not singled out because it was so unique, but because it is actually "emblematic" of millions of small and midsize businesses (SMB) around the globe that are struggling against the confines of ill-equipped, single-purpose accounting systems that are holding them back from reaching their full potential.
As Coleman said in a recent video update, Torelli is one of more than 80,000 SMB customers that are now part of SAP's worldwide installed base. The fact that SAP, a company best known for automating and integrating the business process of Fortune 100 companies, has developed such a large customer base of SMBs around the world "may be surprising to some folks, but it's really a testament to the strength of our small to medium enterprise solutions," he said.
Why are tens of thousands of small businesses suddenly lining up to use the same tools that are being wielded by their largest competitors? For one thing, they can afford it now. SAP and other software vendors have dramatically lowered the entry price for integrated ERP solutions. (Find out just how inexpensive ERP has become for SMBs in the exclusive webcast "InformationWeek SMB On Location Makeover: Torelli Races for the Finish Line with New ERP System," featuring Coleman and others, including Jeff Stiles, Senior Vice President of SME Marketing for SAP AG.)
The other reason ERP's popularity is soaring among SMBs is that in many cases they can quickly realize significant operational benefits that go directly to the company's bottom line, Coleman said. "Many of [our SMB] customers have experienced tremendous growth. Some have experienced [benefits such as] a 25 percent reduction in inventory, based on the efficiencies of a Business One implementation," he said.
Faster implementation time and lower upfront costs have combined to shorten the payback period for an ERP solution, Coleman added. "We have seen customers implement in as little as 30 days, sometimes maybe 60 days, but [they can achieve] a complete implementation in a very short time frame. And we've seen many companies actually recoup or recover the cost of the implementation and the software in less than a year, with resounding results."
What kind of "resounding results" would get your company to switch from a standard accounting package to a full-blown ERP solution? Share your ERP wish list with the InformationWeek SMB On Location audience.