Clouding the risk

Risk, like change, is an everyday part of life and we have to engage with some perils, as reward seldom comes without risk … Luckily, there are various new ways to mitigate risk.

According to Jeremy Waterman, managing director for Sage ERP Africa and Middle East, manufacturing companies across Africa are under pressure to grow revenues, reduce costs and increase profitability – regardless of their size or speciality.

While large-scale enterprise resource planning (ERP) initiatives could help, many African manufacturers are reluctant to implement them. “They fear that the consulting and infrastructure costs would be prohibitive, that the implementation cycles would be long and disruptive to their businesses, and that they would end up with a new set of monolithic applications, which would not be able to evolve alongside their businesses,” Waterman explains.

“Luckily, however, we are seeing a new class of cloud-enabled business management solutions coming to the fore. Such enterprise applications are flexible and modular to cater for the complexities of a global business,” he adds.

Waterman points out that these solutions could provide several benefits to manufacturing companies.

First, a good cloud-based business management platform will allow a manufacturer to automate and accelerate processes and reporting, control performance and improve insights for smarter decision-making within one comprehensive solution.

“The modular nature of a modern, cloud-based application suite means that it’s easy for manufacturers to plug in integrated functionality to support industry-specific processes; such as regulatory compliance, quality assurance and supply chain management,” Waterman continues.

“The speed of deployment is another plus – with a modular, cloud-based solution, manufacturers can quickly go live with functionality that addresses their most immediate pain points. Rather than focusing on the technical nuts-and-bolts, companies can, instead, work on process improvements.”

Waterman says that a robust cloud platform will also give manufacturers insight into what is happening throughout the business – across suppliers, contractors, partners, and customers – complete with multi-language and multi-currency capabilities.

“Enterprise applications have traditionally been expensive. Costs include licences as well as hardware infrastructure, integration, customisation, implementation and support,” Waterman points out.

“The cloud turns the cost of the application into a monthly subscription fee. The capital outlay is less and the operating cost may be less, too. This lowers the barriers of entry to business management solutions for manufacturers that are struggling with a lack of budget.”

Different strokes for different folks

“Small business owners have plenty of choice when it comes to affordable technology that helps to run an efficient, responsive and productive company,” Daryl Blundell, general manager for Sage Pastel Accounting, points out. “Yet, choosing the right software and hardware for small and medium enterprises (SMEs) can be challenging when working with a limited budget.”

He offers some tips on how to choose the best information technology (IT) solutions to suit a company’s needs …

“Start with your business needs, not the technology: Many SME owners focus more on the brand or the technology that they want to buy, rather than on their business needs.

“Look at your online options: You don’t necessarily need to set up your own servers or buy software licences. Instead, you can use free, or affordable, online offerings such as DropBox, Google Mail, and Office 365 for many of your business needs.

“Go mobile. This can have huge benefits for your business. According to the Sage Business Index 2014, for South Africa, 50 percent of South African businesses use a tablet or smartphone to communicate with customers, suppliers or colleagues.

“Look at the supplier’s track record. It’s important to have good technology, but also check on issues such as support infrastructure, customer satisfaction and local expertise when you buy an IT product or service.”