The echoes of Auld Lang Syne had barely faded before news headlines started to warn us that 2019 would be another year of tough breaks, particularly where businesses are concerned.
Globally – the outlook is bleak, with markets across the globe under significant economic stress. In the face of increasing trade tensions and the tightening of financial conditions, the world is braced for a tense time in the New Year ahead.
And, as is to be expected, the local economy will not escape unscathed. In fact, the World Bank estimates that South Africa’s economy will grow to just 1.3% in 2019, which is already down from the initial June 2018 estimate of 1.8%.
Naturally, it means that businesses will spend another year battling to keep costs down while they scramble to find new ways of optimizing business processes.
Tech to Weather the Storm
While many companies will struggle on, adopting the same old strategies they always have, others are tapping into affordable yet sophisticated technologies to weather the storm.
In fact, it’s during tough times like these that it becomes clear just how instrumental Enterprise Resource Planning (ERP) has become in the world of business.
As conditions become more difficult, businesses will look to batten down the hatches in a number of different ways – starting with an increased focus on financial fitness. A good financial track record is needed for businesses to remain attractive to lenders. It goes without saying that without access to funding, growth becomes almost impossible.
And in order to tighten up their approach to financial management, business needs to re-evaluate everything from their operating expenses to the way in which their various divisions are resourced.
They actively need to look for ways of streamlining operations and tightening up the supply chain, more effectively matching supply with demand.
Many businesses will also look to outsource non-core operations and will almost certainly initiate a freeze on headcount, placing even greater pressure on human resources.
This is where ERP can make a massive difference to day-to-day business operations.
Optimizing Operations, Cutting Costs
By its very definition, ERP is a system that helps businesses optimize their operations and simplify their processes. It does this both by automating and integrating core business activities.
From storing customer records to scheduling operations and updating inventory records and financial data, ERP systems provide next-level performance management.
Not only does the streamlining of operations help companies cut costs, but it also helps them save time, relieving some of the pressure on internal resources.
Think, for example, how much time and money is wasted when miscommunications occur across business divisions. Introducing technology like ERP ensures that system updates happen automatically, reducing potential errors and helping to eliminate confusion across operations.
In more extreme cases – where businesses have been unable to affect new hires – automating administrative tasks can help the business to continue to drive efficiencies without actually increasing headcount.
Planning for Success
Because of its ability to forecast specific business outcomes, such as projected sales and potential profit, ERP goes a long way to helping businesses position themselves in a favorable light to potential investors.
And more than this – the analysis of projected data is also a powerful tool in the hands of businesses planning for growth. Companies are able to make better-informed decisions more quickly, keeping them agile and competitive.
As ERP systems become more sophisticated, their ability to analyze current data and predict future business outcomes will only become more advanced. Already technologies, such as those that fall under SYSPRO’s Digitalization (BlueSky) offering, are incorporating powerful AI technology to help businesses make more strategic business decisions.
Ultimately, the year ahead will require a more sophisticated approach to business for those companies that want to remain competitive.
But, with technology such as ERP, businesses don’t need to find themselves casualties of a tough 2019.
It’s simply a matter of ensuring the right technology and systems are in place to ensure you keep yourself relevant in the market.