Generalist vs specialist software users – Moving to MYOB Advanced [Part 5]
In this post, we will examine the differences between a “generalist” and a “specialists software user and what the difference means for your business software research process.
Previous article – You don’t have to eat it all at once – Moving to MYOB Advanced [Part 4]
There is a natural transformation that takes place in businesses once they grow beyond a certain point in that key stakeholders within that business will need to transfer from being generalists into being specialists.
Any small business owner can be classified as a generalist whereby he or she will be called upon to perform several different functions (or wear a number of different hats) on any given business day. This can range from setting up new customers, to running the payroll, to ordering in new stock, to refunding an order to etc etc
Small business accounting systems have been developed with the generalist in mind – where it is relatively easy to perform each of these separate tasks without having to access too many different screens.
ERP systems, however, have been developed with the specialist in mind – or with someone who regularly performs a specialist duty. The assumption lying behind the development of ERP systems is that the company using the system will already have segregation of duties: i.e. AR activities will be performed by an AR clerk/department; marketing activities will be performed by a marketing manager/department; sales activities will be performed by a sales manager/department etc. – and that the members of those respective departments will only need to access certain parts of the ERP system to perform their required tasks.
The differences between the two type of users
If you are accustomed to working with a small business accounting system where you can perform different end-to-end processes with relative ease; you will not find that as easy to do that when you switch to an ERP system. When I say, you will “not find that as easy” what I mean is that you will likely have to access more screens in order to complete any given task. This will feel cumbersome at first. You will also find it not as easy to correct mistakes within an ERP system. Mistakes will usually need to be corrected via a reverse journal entry (to cancel out the original incorrect entry) rather than performing on-page edits to the original transaction.
Being aware of the changes you might experience when you move from MYOB AccountRight to MYOB Advanced is one thing, but it is also necessary to be aware of why those changes are required.
With small businesses, access to the company accounts is usually restricted to the business owner and maybe some other family members (assuming they work in the business) or trusted employees. But as the business grows you will need more people to access the system and as more and more people are given access to the system then there is a greater risk of there being employee fraud. ERP systems greatly reduce the risk of employee fraud as there is an activity log that captures every action.
The other key distinction is that whilst small business accounting systems are easy to use, they are by design, limited in functionality. This means that users of these systems either need to perform additional tasks in other systems (and then double enter the data into the accounting system) or simply forego capturing information in the system in the first place. Foregoing capturing information (whether it be related to customers, transactions, projects, inventory etc) will reduce your business effectiveness as time goes on.
On the other hand, because of their complex nature, ERP systems are more comprehensive and need to be customized to your business. Whilst this customization comes at a Cost, it’s important to understand that compromises between cost and functionality are also possible!
Compromise Is Not A Dirty Word
One idea that you will need to get used to when assessing ERP systems is that it is highly unlikely that you will get all the functionality that you’re after at a price tag that suits.
The extreme choices are that you will get the functionality you’re after but probably pay more than you originally intended, or you will deliver the project on budget but with a scaling back of the initial functional requirement. This means that at some stage during the ERP evaluation/installation process you are going to need to compromise on something.
This is not a phenomenon that is confined to ERP and nor is it necessarily bad.
As has been highlighted in previous posts in this series, an investment in an ERP system is an investment in productive capacity. The full flowering of this productive capacity is something that can be realised over time. So even if there is a compromise on functionality in this financial year, that doesn’t mean that the required functionality can’t be configured or developed in successive financial years.
One of the other ways that you can compromise – which doesn’t get discussed that much but it is a possibility – is to adjust your workflows so that they match the functionality of the system, rather than adapting the system to match your workflows. This approach will dramatically reduce the installation price tag.
Irrespective of the approach you take – and there will likely be some toing and froing with your ERP partner as you come attempt to come up with the optimum mix of desired price and required functionality – it will be useful to know before the fact that flexibility will be a useful attribute when evaluating and installing an ERP system.
So in summary – ERP systems have been designed to cater for companies where there is a segregation of duties. There is therefore greater complexity attached to ERP systems, which means that users of those systems may find them initially more difficult to use. This relative difficulty of use (which will only ever be a short-term phenomenon as users adjust) is a necessary trade-off for the increased security and functionality that is inherent in ERP systems.
For more information or to speak to a specialized MYOB Advanced consultant, call 1300 045 046 or email email@example.com today!