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ERP Vs. Microsoft Access
So you want to learn more about why ERP is better than a basic accounting package and some spreadsheets. I already mentioned that spreadsheets have a high error rate and are single user in nature. I’ve discussed reporting from a database because it’s much easier to report from Excel. You may be under the impression that using a database is the way to go. This makes sense – all things being equal, I’d agree with you. But no, not all things are created equal.
The king of DIY databases is Microsoft Access. It’s actually a pretty good product – with a good community of users who are familiar, if not experts. If you decide to pursue this DIY direction, Access is a good choice for several reasons.
Access is relatively cheap. It’s part of Microsoft Office – although the version with Access is more expensive. It costs about $300 to get the database tools. You can get more stuff, but no more useful tools than Access.
“Programming” Access using built-in wizards lets you create some tables and forms, reports and queries at the end of a day or two of regular work. So call $500 in programming time and $1500 in software and you can get item lists, order forms, purchase order reports, etc…
What’s starting to happen now is serious – and will cost you a lot of money for a while.
Shortly after your database is created and your purchase orders are sent to suppliers, you realize you need to receive something. Vendors are annoying, sometimes they will ship exactly what you want in the quantity and price on the purchase order, but often they don’t. So, over time, the simple access to the database started to turn into something fatal – complexity!
It has become more and more complex over time.
If you go back in a time machine and re-evaluate everything you need to do, you’ll find that your original concept lacks any checks and balances. Even if your employees don’t make mistakes, your suppliers and customers will. Your database (and spreadsheet) needs to cross-reference things to try to detect and prevent errors. This proved to be tricky.
Any decent database configured to do this has to be programmed in. That means it has to have some Visual Basic and that’s not something anyone can do. You could hire a cheap college student to do that, but be prepared to let them do it for a year or two. They don’t do the whole programming.
I’ve seen some great Access databases. I’ve seen databases that interface with CAD and CAM tools, calculate nesting requirements for their software, generate MRP requirements, etc. When I talk to these customers, I conservatively estimate that they spend $2-300,000 to write the application. Almost always a well paid engineer or network administrator working full time. Business reaches a point where they feel trapped (whether on purpose or not). They are afraid of losing this person. Usually when I get there, it’s because the Access database technology has hit some limit (the useful size limit for an Access database is about 500-800 megabytes). Or because the designer has quit, is about to retire, got hit by a bus, or won the lottery.
Checks and balances are necessary to make this system work, without them you’re half a step ahead of the spreadsheet, but still 100 yards from the finish line. They are difficult to program and create. Don’t be fooled. Spending 10-20k on a simple ERP is much better than going this route.
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