So you want to learn more about why an ERP is better than a simple accounting package and some spreadsheets. I mentioned that spreadsheets have a high error rate and are inherently single-user. I have discussed that reporting from a database is much easier than it is in Excel. What you might leave behind is the impression that using a database is the way to go. That would make sense – and all things being equal, I would agree with you. But not me, all things are not created equal.
The king of do-it-yourself databases is Microsoft Access. It’s actually a pretty decent product – with a good community of users who, if not experts, are at least familiar. There are a few reasons why Access is a great choice if you decide to take this DIY direction.
Access is relatively cheap. It’s part of Microsoft Office – although the version with Access costs more money. It costs about $300 more to get the database tools. You get a few more things, but not many more useful tools than Access.
“Programming” Access with the built-in wizards, you can create a few tables and forms, reports and queries at the end of a day or two. So call that $500 programming time and $1500 software and you can have your item list, order spreadsheet, order report, etc…
What’s happening now is pretty serious – and will cost you a lot of money in the foreseeable future.
Shortly after your database is created and your orders go to the suppliers, you realize you need to receive things. Sellers are annoying, sometimes they deliver exactly what you wanted, in the exact quantity and price on the order – but often they don’t. So, over time, the easy access database begins a treacherous march toward something deadly – COMPLEXITY!
It gets more and more complicated over time.
If you went back in a time machine and reevaluated everything you had to do, you would find that your original concept lacked any control or balance. Even if your employees don’t make mistakes, your suppliers and customers do. Your database (and spreadsheets) must have CROSS REFERENCES to detect and avoid errors. It turns out that this is difficult.
Any decent database configured for this stuff must contain programming. That means it has to have some Visual Basic in it, and not everyone can do that. You can hire a cheap college student for this, but be prepared to have him for a year or two. And they will not stop all programming.
I’ve seen some amazing Access databases in my day. I’ve seen databases that connect to CAD and CAM tools, calculate nesting requirements for their software, generate MRP requirements, etc. When I speak to these customers, the conservative estimates are that they spend $200-$300,000 for the spent developing the app. There is almost always a well-paid technician or network administrator working full-time. The company is reaching the point where (intentionally or not) it feels trapped. You’re afraid of losing that person. When I’ve arrived, it’s usually because Access database technology has reached a certain limit (Access databases have a ceiling of about 500-800 megabytes for their useful size). Or because the designer has quit, is retiring, got hit by a bus, or won the lottery.
The checks and balances are required to make this system work, without them you’re half a step better than a spreadsheet but 100 yards from the finish line. They are incredibly difficult to program and create. Do not be fooled. You are much better off spending 10-20k on a basic ERP than going down this route.