“Start small and think big” is advice often given to startup companies. And it makes sense—up to a point. For example, you don’t make million dollar investments during the early Exploration Phase. Instead, you start small, analyze drill results, aerial surveys, and exploration reports before making larger investments in the property. However, when selecting business management software, many miners think too small, so they buy entry-level software. This can be a big mistake and can seriously limit their ability to grow. So, here we offer five reasons to think big, not small, implementing a mining ERP solution early in your company’s operation.
Startup or Holdup?
Sure, as an exploration company you may think of yourself as a small business. You are pre-revenue, have only exploration projects and your accounting doesn’t seem all that complex. But if you choose entry level software, you’re missing some of the unique characteristics about mining operations. Mining organizations often have multiple companies and multi-currency transactions. They require approval workflows and segregation of duties to meet regulations. Drilling programs require project-level tracking and financial reporting involves consolidations and sophistication, even in the exploration phase. Because entry-level software is very restrictive, it does not deliver on these requirements. The limitations of the software can lead to excessive manual work and will hold up your progress.
Conversion Theory is Never Good
In theory it makes sense to stay with entry-level software until you outgrow it and then convert to a “real ERP” when you need to. Think of all the money you’re saving! The theory is flawed because ERP conversions are expensive and disruptive, even when well planned and expertly executed. Time spent on data conversion is time taken away from growing the company. Avoid this disruption by starting with a well-priced ERP solution in the Exploration Phase and simply expand that solution as you grow. Implementing an ERP solution that grows with you eliminates the need for data conversions.
Excel – Friend or Foe?
If you use entry-level software for your mining company, you perform many functions outside of the software. Excel is often looked at as the solution so complex excel-based models are built to deal with the limitations of the accounting software. This is often done for financial reporting, tracking of fixed assets and project tracking. The problem is that Excel does not have strong audit tools, errors are often difficult to detect, and a simple Excel project has a way of ending up as a complex labyrinth of linked sheets and undocumented macros. You now have a system open to undetectable human error, with security risks and difficulty scaling.
Not all ERPs Break the Bank
The ERP acronym stands for Enterprise Resource Planning and therefore often equated with high expense and excessive complexity. The industry really must not come up with a better name for integrated business management software. However, it’s simply not true that an ERP must be expensive or overly complicated. Mining ERP solutions like Caron Mining Solutions – Explore provide broad, integrated functionality at a surprisingly low price. Explore includes the critical functionality required for exploration in one cohesive, connected database, including:
- Powerful financial management,
- Approval workflows,
- Multi-company, multi-country and multi-currency capabilities,
- Inventory management and consignment inventory,
- Fixed asset tracking,
- Intercompany transactions.
Implementation Costs are Manageable
Software subscriptions are only part of the cost of an ERP implementation. Another major cost is the implementation services by a consulting firm like Caron Business Solutions. These costs are easily managed with one simple step. Use a partner who understands the mining industry. If you’re talking to a partner that wants spend time talking about sales order entry and customer reporting that’s a strong hint that they don’t understand mining. In the Exploration Phase there is no revenue so why talk about customers? Why design a sales order process? Caron Business Solutions has supported mining for over 25 years. We understand the challenges and priorities of mining companies. An important component of Caron Mining Solutions – Explore is a fixed fee implementation. We can offer this because we don’t have to learn the industry – we just concentrate on implementing a system that works for mining companies.
In conclusion, manage your investments carefully in the Exploration Phase. Start with a smart, inexpensive and well-implemented ERP solution to get a system that works for you now and grows with you. With a mining ERP solution, you can optimize internal efficiencies, increase the speed and standard of execution, and accelerate lean, informed growth.
We invite you to learn more about Caron Mining Solutions and contact us with your questions.
