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ERP vs Accounting Software: Key Differences Explained

Forgestik Team  |  April 25, 2022

Here are 5 compelling reasons to switch from an accounting software to an ERP system

Now more than ever, we find ourselves constantly surrounded by new and emerging technology. It’s changing how people work and connect in order to optimize client value, connectivity and employee well-being.

A smart business accelerates digital transformation by using technology and data to optimize its processes. An ERP (Enterprise Resource Planning) system is a vital piece of optimization. It helps businesses streamline their processes and remain ahead of the curve against competitors.

In this blog, you will learn five compelling reasons why you should choose and implement an ERP system.

1. Employee morale

When your employees spend most of their days manually inputting data into Excel spreadsheets or doing other error-prone manual tasks, productivity drops down. With an ERP system, repetitive (and often dreary and tiresome) tasks are automated. And by automating redundant processes, your employees have more time to work on other time-sensitive, pressing tasks. Although not widely expressed, one of the key benefits of implementing an ERP solution is the increase in employee engagement and morale. With the right ERP software, you can focus on your workforce, taking into consideration the entire ecosystem of your business. Your employees will gain better control over their day-to-day activities, feel empowered at work, exhibit stronger performance, and report higher job satisfaction.

2. Company growth

Most accounting softwares are pitched at the start-up level. While they are a brilliant solution to start out, the pitfalls begin to surface as your business matures. If your current software does not allow you to be proactive with your customers, or if there is a lack of security and/or accounting controls, too many spreadsheets and workarounds, that system might be holding you back. On the other hand, an ERP enables you to optimize your processes, rapidly transform your small business into a more productive and agile organization, take the guesswork out of the equation, and get the insights you need to fuel growth.

3. Centralized reporting

Many businesses are still comprised of several legacy systems and processes that have left the current structuring inefficient and expensive. Your departments may all be using their own system separately which makes keeping track of everything much more difficult — you can’t analyze operational data in a timely fashion because not all of it is in your accounting system. In fact, when you finally get the reports you need, they reflect the status of your business as of the last accounting cut-off. As a result, you’ll be basing your decisions on a historical record, not a current one.

Your ERP makes it possible for your finance team to add value rather than just capture data. Beyond the importance of teamwork, collaboration between departments is a fundamental part of your organization’s success. An ERP system can make your data centralized, accessible and always up-to-date, powered by automated processes, enabling departments and individual employees to work together.

4. Flexibility

An ERP system enables an organization to adapt, change, and grow in a scalable way over time. The entire system can be easily customized to meet the needs of each company's business processes, data requirements, and technology environment. ERP is more of a platform than an application and can save you more time and money with adaptive features. Being able to adjust the interface and application components provides a competitive advantage. Leading ERP solutions have a flexible core architecture, improving the way the ERP setup operates and creating a higher degree of user freedom. Industry-specific software capabilities quickly add up to significant time savings for you, your business users, and your development team.

5. Better customer relationships

Customers are now driving business. Modern ERP applications have an integrated system for all modules. This helps in coordinating the workflow between various departments and there’s a lesser chance of miscommunication. The customers will receive the same information across all channels. Backed by ERP information, your customer support is better prepared to provide accurate, faster and more impactful service.

Customer support is also about delivering quality products at the right price. Moreover, by using information about the products, available inventory, and information about the customer, your ERP system can help you avoid delivery delays. You'll also be able to better manage expectations by providing more accurate delivery estimates. And happy customers means growth and repeat business for your company.

Grounded in hands-on experience and deep industry understanding, Forgestik brings together a team of experts to provide comprehensive ERP solutions for every SMB. Contact us to find out more.