by Robert Mann

Created on: September 11, 2009   Last Updated: October 20, 2009

How can the SME gain competitive advantages through technology?

In our current economy, the speed at which consumers can compare prices and review products mandates competitive advantages for market share. Unfortunately, human initiative and speed alone no longer suffice to put a business at the top of a given market. Technology must be leveraged in a manner that extends and multiplies the effort and expertise that each employee brings to the table. While the types of business technology are almost endless, a critical application for sustained competitive advantage is enterprise resource planning or ERP.

Types of Competitive Advantage:

Advantage over competitors can be gained in multiple areas and at multiple levels. Examples include cost advantage, differentiation advantage and positional advantage. The primary factors feeding into competitive advantage include innovation, reputation, and relationships. Advantage can also be gained by excelling in one or more of the following: Price, service, quality, location, and imbedded customer base.

It is essential that competitive advantage be sustained. The prolonged execution of a unique and value-added strategy will translate into ongoing gains in market share. The ability to duplicate the strategy will further enhance the success rate.

The Power of ERP Applications

ERP applications can transform small and medium enterprises by driving sustained competitive advantage. They provide a comprehensive view of the enterprise that includes customers, products and operations. The benefits of a robust ERP system include, but are not limited to, the following: Streamlined business processes, elimination of duplicate data entry, rapid access to information across the enterprise, in depth analysis that allows for informed business decisions, reduced inventory levels, improved fill rates, and accelerated rates in the order entry process.

Self-hosted or on the Cloud

There are two basic approaches to employing an ERP system: Hosting the software on company servers or having the application hosted externally. Hosting an application internally usually involves buying the product for installation, then paying an annual fee for items like upgrades and technical support. Having applications hosted externally is commonly called "on the cloud computing". With this approach the application is hosted and maintained by a vendor, and users log in to their company account to use the product. On the cloud computing is also referred to as software

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