As small and medium businesses (SMBs) accelerate their growth, they quickly encounter many of the same challenges with which larger enterprises are grappling. Poor visibility into operations, slow or inefficient business processes, and an inability to move fast to respond to a changing business landscape are just some of their issues.

The answer that most larger businesses embrace to these challenges is an enterprise application suite that allows them to manage every aspect of their business in an integrated way. Just like larger businesses, SMBs need technology that scales as they grow, helps them to streamline their processes, and enables them to maintain process discipline—all without constraining their agility.

Yet enterprise resource planning (ERP) software has a reputation for being too expensive, complex and feature-dense for the average SMB. The traditional thinking is that applying ERP to a small business’s challenges is a bit like using a flamethrower to kill a mosquito or unleashing a tsunami to put out a candle—an expensive, risky solution that may harm the business more than it helps.

However, ERP has evolved over the years, and many of the preconceptions SMBs have about ERP have become misconceptions. Indeed, one global IDC study shows that 92% of SMBs (those it defined as leaders that are outperforming their peers) use or plan to use ERP software. Let’s bust some of the myths about why ERP isn’t a good fit for SMBs.

Let’s explore the myths behind ERP

Myth #1: Not only is it too expensive, but the costs are too unpredictable

As the ‘e’ in the acronym implies, the first ERP software suites were complex, monolithic solutions designed for larger enterprises. They’d need substantial budgets for hardware, software licences, consulting and integration to implement an ERP suite. The complexity of the deployment meant that the costs weren’t always predictable. So many SMBs still think ERP is still just too expensive for them.

Reality: Today, SMBs can choose from a range of ERP solutions that are designed to be affordable for smaller organisations. They can opt for a software-as-a-service or hosted solution that enables them to pay a predictable monthly fee for their software. Total cost of ownership is kept low since ERP solutions for SMBs are designed to be low maintenance. Plus, today’s modular architectures mean ERP can scale and grow to meet an SMB’s evolving needs.

Myth #2: ERP takes years to implement

Many SMBs still think of ERP as a project that will take years to reach fruition, causing disruption to their business for 18 months or two years as they implement the software. ERP is associated with complex business reengineering exercises as well as extensive customisation and integration efforts. But is this still the case?

Reality: ERP best practices for companies of all sizes have come a long way over the past 10 years. And SMBs, especially, can benefit from ready-to-run cloud ERP built on the latest industry best practices. Proven tools and methodologies bring predictability to the scope and timeframe for an ERP deployment. It’s today possible to deploy an ERP solution in months or for simpler cases, even within weeks.

Myth #3: The path to ROI is long and uncertain

In a challenging environment, most SMBs are looking for quick wins when it comes to cutting costs, increasing productivity and driving revenue growth. Many perceive an ERP solution as an option that will take years to deliver return on investment (ROI), soaking up human and financial resources until they can finally go live with their platform.

¸é±ð²¹±ô¾±³Ù²â:ÌýThe modular nature and flexibility of a modern ERP system means that it doesn’t need to be rolled out in a single, big-bang implementation. Companies can introduce ERP modules in a phased approach, using the features and functionality that address their most pressing pain points. They can expand the deployment over time, effectively using ROI from the earlier phases to pay for the later ones.

Myth #4: ERP is too complex for SMBs

ERP software packs in a lot of functionality, so many SMBs are concerned that it could add more complexity to their processes. Many also wonder whether the software will be too difficult for their end-users to use, especially if they’re implementing ERP after using Excel or simpler finance packages for many years.

¸é±ð²¹±ô¾±³Ù²â:ÌýEase of use of ERP software has improved in leaps and bounds, with a slick user experience that will be familiar to anyone who has used a mobile app or cloud productivity tool before. While there are many features and modules available, the deployment can be tailored to the business’s needs. ERP makes life simpler because it eliminates redundant processes, breaks down data and business siloes, and reduces the need to work across multiple tools, systems and manual processes.

ERP is not just for big business

ERP can help businesses of all sizes to streamline processes, remove duplication of effort and enable the frictionless flow of accurate information across their operations. It’s an essential tool for any business aiming to achieve greater efficiency to increase operating margins, while leveraging improved insight to grow revenues. Today’s solutions enable SMBs to unlock the power of ERP, so they can compete with larger companies on a more even footing.

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Bloomberg reports that , accounting for a third of total assets under management globally. This is nearly double the $22.8-trillion in ESG assets under management in 2016.

Effective sustainability-led business transformation creates long-term value for organisations as well as the communities and environment in which they operate. And when sustainability is embraced, it drives innovation across the business, leading to benefits for employees, customers, communities and investors.

However, there isn’t really a template for sustainability that can be repeated across businesses and industries. Each business needs to find tailored approaches to sustainability that take into account its industry, customers, business model and geographical market.

And nowhere is this more apparent than in the energy sector.

Energy market shows complexity of sustainability

The latest data from the International Energy Agency shows the .

Amid growing demand for reliable energy from a global population that has swelled past the eight billion mark and severe energy constraints resulting from the conflict in Ukraine, many countries have had to rethink their energy mix.

At or near the top of priority lists is the transition to cleaner, more sustainable and less environmentally-damaging forms of power generation, mostly from renewable energy sources such as wind and solar.

Calls for a ‘just transition’ have grown over the past few years as devastating storms, widespread flooding and extreme temperatures bring home the distinct dangers of a warming climate.

The World Economic Forum reports that global energy investment reached $2.4-trillion in 2022, of which . However, most of that investment stemmed from more developed Western economies.

In emerging markets, investments into clean energy are more complex, partly due to the availability of natural resources, where fossil fuels such as coal are easy to mine and readily available.

To achieve sustainability goals in emerging markets while still driving growth and economic progress, organisations need to develop smart, tailored strategies. But it can be challenging to understand where to start.

Sustainability requires tailored strategies in emerging markets

Developed countries have already leveraged carbon-intensive forms of energy to build their industries and boost their economic growth.

A transition to cleaner energy is arguably much easier in developed economies than their emerging market peers, where many of the developmental gains enjoyed by Western economies are still to be realised.

Much of Africa is still in a process of industrialisation and urbanisation, a transition that developed economies have long since completed. To build industries, support economic development and accommodate a rapidly growing population, African countries need access to affordable, readily available forms of energy.

This means that fossil fuels will likely remain a core part of the energy mix across much of Africa, especially in industries such as manufacturing and mining, where wind and solar power simply can’t provide the baseload energy needed for production.

Take mining as an example. The mining industry has traditionally been among the leading consumers of energy. As energy capacity becomes increasingly constrained, especially in countries like South Africa, mining operations have had to reduce their reliance on the national grid and build their own stable power supply.

This has led to huge investment into solar energy as a means of keeping the lights on. The power generated through solar helps power mining fleets and support the running of the entire operation. Some mining companies have even invested in hydrogen-powered vehicles as a means of reducing reliance on the grid.

However, solar power cannot provide the power needed for energy intensive processes such as smelting. For these processes, mines and manufacturers still need to rely on less sustainable forms of power.

Plotting a viable course for sustainability

Understanding the need to balance sustainability with business viability, how can African organisations start their journey toward sustainability in a way that still drives successful business outcomes?

Firstly, sustainability does not mean sacrificing profits. In fact, companies that successfully integrate sustainability into their strategies can potentially unlock a broad range of benefits, including increased revenue, reduced material expenses, reduced utility and fuel expenses, greater employee productivity and talent retention, and reduced hiring expenses.

Secondly, companies that can effectively manage their ESG (Environmental, Societal and Governance) risks can see a boost to their reputation, improved management of tax costs, and greater scope for investment to unlock long-term value. Incorporating sustainability into the core business strategy therefore holds the potential to deliver immense benefits, and should be a top priority for business leaders.

Third, when developing a business case for sustainability, organisations need to take a three- to five-year approach, which provides enough time to allow for new initiatives to gain the traction needed to yield results. The business case should be developed in alignment with core elements of the company income statement to ensure each sustainability benefit is directly tied to a measurable business outcome.

Funding for sustainability initiatives should come from existing line items in operational budgets, similar to how aspects such as marketing, education, and communication are budgeted for. Savings achieved through reduced material and utility expenses or reduced hiring expenses can be allocated to fund further sustainability efforts, unlocking additional cost savings.

Finally, organisations should understand that remaining trapped in the inertia created by unsustainable business models will make it difficult to succeed as they lose loyalty, talent, customers and market share to their more sustainable peers. By proactively making sustainability a core part of their business strategy, African organisations can discover new sources of competitive advantage for all stakeholders.

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