Small and medium Enterprises (SMEs) are the building blocks of development of any country . While traditionally SMEs have come into existence as cost optimisers for Big Enterprises , over the years they have become important partners in the progress of any Enterprise in view of some innate strengths by their very nature – better / faster breeders of Innovation/Productivity /creativity , faster response , lower cost / cycle time , better flexibility offered to end consumer /customer – big or small etc .


As the Enterprises are getting more globalised , Technology becomes key to Competitiveness . As Technology becomes the biggest value adder and /or enhancer , SMEs need to get integrated into the Eco-system of Enterprises , Markets , Supply Chains , Technology and Customers /Consumers . 

There is a general feeling that SMEs tend to lag behind in this integration process especially adaptation to ever changing Technology / Business Processes 


SMEs are a life line for Engineering Industries , comprising a very wide spectrum – Capital Goods , Energy & Power Industries , Mining Equipment , Infrastructure , Automobile , Defence , Aero-Space etc . There is a wide range of Products , Systems and Services offered by the Engineering Industry . The Business Profiles of many companies represents a mix of Engineering , Manufacturing , Construction , Services etc . SMEs play a very important role in supporting the Engineering Industry at every stage of the business – Product Development , Manufacture , Installation & Commissioning , After Market Service etc

SMEs serving the Engineering Industries many times are structured to replicate the complexities of the Enterprises they serve-

✦ Engineering of Products /Systems may undergo some or substantial changes as the Project progresses

✦ Procurement of Material with test protocols and traceability 

✦ Development of Manufacturing process plans

✦ First piece qualification , prove out of process

✦ Engineering and manufacture of Tools , fixtures

✦ Quality Plans , In process quality checks

✦ Final testing if required 

✦ Performance validation

✦ Warranty Obligations linked to end Project completion spanning a few years

✦ Some of the processes requiring Customer Approval – ex Final specification , design , quality plan , test protocol etc

✦ Interface Engineering /manufacturing issues – one SME ’s Product /component may need to be redesigned /manufactured suiting the possible system changes , the matching requirements for some other product / component etc

The Material, Production planning become complex in view of unpredictable product mix , customised engineering, planning and manufacturing . It is always a challenge to ensure optimum capacity utilisation with customer expectations. Many times SMEs are not even sure whether they have the required resources to meet the customer commitments as per schedule


When it comes to competitiveness, integrated real time information is the key: be it tracking the customer orders / material , stage of production, status of customer approvals , shipments to customer , billing or cash realization , in process rejection , corrective /preventive actions , customer complaints etc .There is not much difference between big Enterprises and SMEs .

That is where ERP comes in:

ERP ensures that we have a system of making a forecast of possible product mixes, timely material planning, manufacturing plans to meet customer commitments, optimum capital utilisation etc . Over the years we can reduce the cycle time for engineering / procurement /manufacture , improve the productivity , reduce the cost , reduce the rejections increase the throughput , maximise profits and increase Customer satisfaction

ERP is end user oriented with 

✦ End user working with integrated multiple data bases

✦ Decentralised management information system

✦ End user delinked from Computer professionals

✦ Enabling decision support systems 

Also ERP enables Optimised Asset Integrity Management, translating Company’s long term sustainable goals into Technical / Financial Targets /Plans /Actions

While some large Enterprises may give lot of weightage to ERP being in place in assessing SMEs for enlistment and making them preferred partners, it is in the interest of SMEs to have ERP in place for their own competitiveness and ability to grow in a sustained way 


Most of the SMEs being Entrepreneur driven / family owned are tight fisted on investments for modernisation , IT , Digitisation etc . The typical scenario points to thinking on the lines of

✦ We are comfortable with existing processes

✦ Why should we invest a lot of money in IT /ERP / Digitisation , why not invest that kind of money in adding more manufacturing assets ?

✦ We may need to change lot of our processes

✦ We may lose flexibility

✦ There could be resistance from the employees ; 

✦ We need to recruit highly skilled people to install and maintain the infrastructure

✦ We may lose hands on controls 


This is when ERP Cloud solution comes in.

Cloud solutions enable SMEs to adopt ERP in a phased manner , if desired / required and make it affordable without going in for major investments / loans. In fact it may be possible to meet the cost / cash flow requirements for ERP out of the gains /surpluses being generated by ERP. Implementation can be almost seamless with in a short time. 

While a few business processes need to be tweaked keeping the best practices of Industry , the implementation can be seamless without impacting Business Continuity.

It is possible to have have variants of ERP implementation as it suits one’s needs through Cloud Solution by a consulting firm with software customization capabilities

✦ Completely remote managed with SME getting only the needed / prescribed dash boards / reports for timely interventions

✦ Over all system, architecture decided in consultation with implementation agency or an independent consultant , major hard ware /software provided on cloud by the service provider , with minimal hardware /software at the user’s premises

✦ You can choose module wise without compromising on the integration of processes /data

Th best part is, it is possible to carry out a number of transactions using mobile phones, from any where in office , at customer end or working from home


ERP is the platform which enables SMEs to quickly adapt themselves to the new Digitising world. A robust ERP system makes Digital integration of the company’s operations /initiatives with all stake holders efficient and seamless. SMES can quickly graduate to Web based , Digital /social media assisted Customer / Vendor relationship management , E-Commerce etc extending to IOT, AI /Analytics tools etc.

So can SMEs in general and those serving Engineering Industry in particular remain digitally illiterate / ill equipped and afford not to embrace ERP in a world which is getting digitised at warp speed? Probably not, If you’d like a consultant, contact us at [email protected], we’re the Top 5 out of 100 ERP consulting companies on themanifest, and the No.1 firm that has not only ERP consulting capabilities, but also software development expertise.

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