Previously, enterprise resource planning was used only of large business companies. It required lots of money to be invested. Small scale and medium sized companies were not ready to invest a large amount for buying software and employing staffs for managing ERP software.

Keeping this in mind, ERP vendors started diversifying their enterprise resource planning software by releasing many versions of the software which could assist small companies too.

Also, small sized companies might not require all the tools and customizations available for the big companies. The ERP software got tailored particularly to meet the small sized companies and for increasing the productivity. After this, small sized business people also started buying ERP software which matched their investment amount.

From the early 1990’s ERP helped the companies in driving down their cost and also helped them in operating more efficiently. Effective data management also helped streamlining the business process effectively. Planning, manufacturing, marketing, sales and quoting services kept on improving. Stock control, financial tracking and customer service also got better with ERP. Many time consuming and labor related processes were eliminated by the small business with the usage of enterprise resource planning software.

The flexibility which ERP offers is definitely a very big advantage which interests the small business. Flexibility and the real time control over the price and the jobs are the key features for a small sized company. Concise reporting is also a main factor which decides the quality of the company.

Based on these needs, ERP vendors have made installation of the related software as very less complex with much less manual job needed. The user friendliness of the applications also got improved. Adding more users or customers will no way affect the functionality of ERP.

Many small businesses are already enjoying the benefits after successful ERP implementation. The profit of the company has certainly increased after the usage of ERP provided the implementation procedures are followed perfectly. Business which implemented ERP successfully saw their business profit increasing within one year itself.

A good ERP system comes with essential features that will provide the functionality of comparing the hours of working of the professionals and the actual hours of work which was paid as a salary. In fact, many small businesses just doubled their return on income with just using this service effectively. With this ERP, they were able to monitor the time of production, cost, employee activity, overall performance of the company and many more crucial information.

Before setting up ERP systems, small business must first identify the business requirements. The impact which the ERP is going to have on the business should be well analyzed. Cost factor involved in implementation should be set aside initially. Once the requirements are well planned, then comparison can be made on different vendors available and the vendor which provides cost effective service and be opted.

Every company is looking to increase its market value. For, this they are re-looking into the factors which affect the company’s productivity and management. Every company is looking to use their resources effectively so that their business is done more effectively and efficiently. Most of the companies decides to use software which could manage their whole enterprise and the information should be available with the enterprise.

With this need, enterprise resource planning came into picture. Enterprise resource planning is a software based system which helps in managing every functionality and operation of the company. It ensures that there is proper and reliable data communication between various parts of the business units. This helped many businesses to increase their productivity and cut costs on management related funds.

Usage of enterprise resource planning software have helped many companies in analyst and optimize their business process, enhancing the supply chain management, efficient control of inventory, enhanced decision making by providing precise reports, integrating various business units and developing transparency all over the business.

In a typical corporation which implemented ERP successfully , the customer sales department can get access to the purchase department, inventory department data can be viewed by the sales department and the top management can see the overall structure and the work flow of the company with a single click. This is what a comprehensive enterprise resource planning software is capable of.

The impact of the enterprise resource planning can be seen evident with the company even before 12 months of implementation. With proper planning and successful implementation ERP can provide a strong platform for better productivity. The implementation of ERP helped many companies in increasing the value chain in the market. It also created confidence among its customers. Share holders also bought shares of these companies with confidence.

In previous stage before ERP comes into practice, companies used separate software for each service. Separate tools were used for sales tracking, financial management and for human resource management. Lots of employees were employed for managing separate software. This resulted in redundant technology, service was poor and the staffs found it very difficult to integrate data from these services and create a report out of it.

Critical information could be extracted from such independent software. But, with the advent of enterprise resource planning software, managing all the resources under a single system was made much easier. Also, lots of manual work involved in resource management was cut down to a large amount.

Compared to the big industries, small and medium sized industries used the ERP efficiently. In general enterprise resource planning can be used to introduce standard industry process, implementing integration across various inter related business units within the company, real time access to the information and creating analytical report with a single click.

The science of business performance management heavily relies on the ability to create a series of critical tests to assess whether the program is successful or not. These do not necessarily have to be on a strategic level. They can also be set on an individual or local basis.

The first stage is to set up a business data analysis program with the specific goals of trying to change the performance levels of the organization from the less desirable to the more desirable characteristics.

The desirable characteristics are crucial because they will contain a basis for ambition as well as a realistic target based on the knowledge of the industry as a whole. Once these goals are measurable, they then become key performance indicators (KPIs) that will form the basis of any assessment of the project either on a one off basis or on a continuous basis.

Key performance indicators are always supported by data and therefore it has to be a management priority to ensure that there are facilities for presenting accurate data in a timely fashion. Obviously performance management will mean different things to different people and there might be the scope for allocating different data sets or schedules depending on need. Sometimes there is an obsession with financial performance indicators whereas it is possible to measure the non-financial data which gives you an accurate picture of the organization.

There are a large variety of business performance metrics and indicators, and they cannot be exhaustively described within the constraints of this article. However I will briefly touch on some of the major ones; the most important metrics will measure customer satisfaction and their relationship with the company. This is the basis for any profitability and therefore they ought to be prioritized.

The accountant will naturally pay close attention to the financial metrics such as cash flows, debt, capital investments and the speedy conclusion of commitments. Without finance the company will fail so managers must never ignore the implications of finance in any business performance management activity that they undertake. However this should not be to the total exclusion of other criteria.

There are also non-traditional metrics that are slowly creeping into business practice. For example twenty years ago the environmental impact of business activities was largely ignored as a fad for the dopey rich kids or the political correct tree huggers. The pursuit of the bottom line was king and such concerns were not even subordinate. They were simply excluded altogether. However as the awareness of ecological issues has grown, it has been necessary to insist that this is included as part of the core metrics.

As always the key is to understand what is need to get your business to the place you want it to be. The metrics and key performance indicators are the tools for you to assess whether you have been successful in your business performance management program.

The first major challenge is to identify which project requires which indicators. The list of performance desirable will be virtually endless and the managers will have to make a decision to prioritize or deprioritize certain factors.

A weighting index can be applied and the decision making about the factors can be democratized so that everyone has a chance to contribute their own interests. However the business has to have its own standards that ensure that the strategic objectives are being carried out even at the lowest units.

The balanced scored gives opportunities for managers to include socially responsible measures within the performance management framework yet still retain the core issues such as sales figures. This can enhance the reputation of the company and mean that it does not fall foul of recent legislation covering the conduct of companies. Environmental issues are such one area that can be included in the score card.

The problem with including worthy causes is that they are very hard to measure and in fact could be working directly against the other traditional objectives of the firm. Take for example the need to control emissions versus the need for an oil refining company to make as much profit as possible. The balanced score card would put these diametrically opposed issues against one another.

Managers have tended to deal with this problem by concentrating on the bottom line. The issue of profits enables them to concentrate minds. The only problem with this approach is that it is now not only the government that is placing legislation against anti social business practice but also consumers. Boycotts are not uncommon if a particular company is found to be violating the moral standards of their customers.

A far better way is to think of the firm as an organism that requires different nutrients to thrive and grow. Some of those nutrients are more expensive than others but the bottom line is that the organism needs those nutrients and must therefore have a balanced diet. The purely traditional methods of assessing the business performance of a firm can be outdated and mind end up costing more.

A lot of effort should be put into identifying the areas which can easily be put onto the performance scorecard. A broad priority list can then be created to ensure that as many of the non popular causes as possible are included. The business performance management protocols can then decide when to add an element and when to subtract it.

After all the greatest ambition of performance management is to provide the decision makers with a situation where the organization as a whole is thriving and contributing to the business objectives of the owners. It is better to have too much information than no information at all.