In the dynamic business landscape of 2024, Small and Medium Enterprise (SMEs) in Singapore are finding themselves at a crucial junction where embracing technology is not just an option but a strategic necessity. For most SMEs, this period of time will be a golden opportunity look into and explore new ways and possibilities to improve their company’s efficiency and productivity levels. One of the pivotal decisions facing these enterprises is the adoption of an ERP system (Enterprise Resource Planning).
In fact, according to Economic Survey of Singapore First Quarter 2023, digital capabilities of SMEs have been built up strongly to seize opportunities in the digital economy with the support of PSG and SG grants. In this article, we will delve into the top 3 reasons why SMEs in Singapore should consider integrating an ERP system into their operations in 2024.
What is an ERP system?
ERP system is the management of business processes that are often automated with software and technology to better monitor and improve operational performance. A fully integrated ERP software can facilitate different parts of a business including manufacturing, marketing, accounting, finance, customer management and human resources. An ERP app is not a simple software program but is a massive software architecture that can integrate all departments to provide better information transparency and more efficient communication within an organisation (Investopedia).
Why are SMEs recommended to implement ERP?
Understanding ERP software as a complex and innovative technology to optimise business functions, how they outweigh other tried-and-true solutions still remains unexplained. Knowing these 3 reasons is valuable for you in the consideration of acquiring an ERP system.
1. Governmental funding and initiatives for SMEs
Since the announcement of the 2016 budget, the government’s stance on digitalisation has been targeted at SMEs with increasing supportive schemes. In 2017, the government implemented the SMEs Go Digital Programme by IMDA with roughly $80 million. The program’s main objective is to help SMEs build digital capabilities by getting professional step-by-step advice as well as financial support.
During the period of 2017-2024, amidst rapid technological advancements and constant changes in the business environment, the Government remains committed to curating relevant and effective digital solutions for companies and supporting them in the digitalisation journey.
By 2024, SMEs Go Digital grants lead to improvements in firms’ outcomes. Specifically, the take-up of PSG and SG grants led to an increase in firm’s productivity of 3.0 percent and 1.8 percent respectively, as well as an increase in firms’ revenue of 2.2 percent and 1.6 percent respectively.
On this note, if you are a Singaporean SME, there is no opportune time rather than the presence to take a step towards digitalising and revitalising your business with an ERP system.
2. Increased usage of ERP system
With the continued development of AI, blockchain, big data, and the IoT (internet of things), it comes as no surprise that the ERP market has been steadily growing over the past few years with the presence of ERP solution vendors. According to market research conducted in 2023 by Research Nester, the Singapore ERP software market is estimated to garner a revenue of USD 2,642.4 million by the end of the 2033. This could be a vivid illustration of the money cash flow into the digital infrastructure of SMEs.
Such robust growth of the ERP market reveals a trend among businesses to replace the old system or traditional silo methods with an ERP system. Thus, it is high time for SMEs to evaluate and consider making room in their budget to invest in an ERP technology this 2024.
3. Better flexibility and less complexity for a business management system
An ERP system can provide significant flexibility to your company owing to the scalable capacity and ability to handle large amounts of data. For instance, ERP users can set up various languages and pick up different currencies to operate in the system; pricelists or accounting standards can be easily modified in the system to apply for the entire organisation; users can be able to access the database anywhere, on any devices on browsers or with a mobile application.
Though ERP system is a complicated program to develop, operating such advanced technology is certainly not as complex as other legacy systems. As a matter of fact, at least 16% of companies that implemented ERP systems were due to replacing old legacy systems that were not user-friendly (Panorma’s Report on ERP Systems and Enterprise Software). In partnership with ERP providers, users will often be provided with dedicated in-person training and prompt helpdesk support for any inquiries or outstanding concerns.
Investing in an ERP technological solution is highly recommended for SMEs especially in 2024. Firstly, while the funding and support offered by the Singapore government are still available, make sure you grab the opportunity to apply for the grants. Secondly, in terms of technology, it is better early than late as the burgeoning ERP market suggests that the shift towards ERP system is unavoidable for SMEs. Finally, it is impossible to ignore the productivity/ efficiency benefits, convenience and automatic features that you can derive from implementing a functional ERP system. You can read more in our article on how an ERP system helps SMEs overcome challenges.
Synergix Technologies is Singapore’s largest local and principal developer in ERP software. Having more than 34 years of experience in the ERP industry, our team is committed to providing effective business solutions with innovation and care – Your Requirement, We Deliver.