Constraints Of A Small Budget, Malaysia Business Times, Monday, October 16, 2000

Constraints Of A Small Budget

Malaysia Business Times, Monday, October 16, 2000


The high costs of new management, technology, especially for small to medium-businesses, was one of the main issues of concern among the 25-odd participants of the Ninth Chartered Institute of Management Accountants (Cima) CEO Forum in Penang recently.

The Cima CEO Forum is a biannual event where corporate chiefs and Cima Malaysia leaders share their knowledge, experience and expertise in dealing with topical issues pertaining to the Malaysian business scene.

The theme this year was "Web-enabled Enterprise Resource Management (ERM) for Business Success" which was tackled at length by managing director of KarenSoft Technology Sdn Bhd Chee Chong Hwa and chief executive officer of' NeuraTek.com Sdn Bhd Jimmy Ting Heng Toon in their respective presentations.

In his presentation, Chee defined ERM as integrated, applications which cover a combination of financial management, human resource management, distribution/materials management, manufacturing/production management and, more recently customer relationship management.

If viewed in equation form, he said, ERM makes up the combination of enterprise resource planning (ERP), supply chain management and customer relationship management.

Cima member Michael Eow, initiating the open dialogue after the presentations, noted, that smaller-sized businesses", tend to lose out to bigger, corporations in implementing high-cost advanced technology such as ERM owing to budget contraints

Chee however, was of the opinion that size is relative and regardless of whether a company is big or small, it will need to have certain aspects of ERM, be it sales, human resource management or accounting.

"ERM takes many forms ... sales, planning, distribution and so on. Every,company has its own little ERM, perhaps without realising it ... perhaps they're just not connected yet," he countered, asserting that it is very much possible to implement ERM solutions in smaller companies.

Ting estimated that it will cost companies about US$50,000 (US$1 = RM3.80) to implement the system, deeming it "affordable," on,account the savings a company makes because of further efficiencies in operations.

To a question on how, Malaysia companies were responding to these solutions, Chee said there appeared to be an increase in demand for his company's ERP solutions in the northern region of Malaysia and in Petaling Jaya, specifically among small to medium-companies.

According to an International Data Corporation (IDC) survey, the ERM market tenders in Asia Pacific, this year, was US$650 million, with the ERM market in Malaysia estimated to be about US$52 million. Chee said this,comprises roughly 100 companies.

"You have no choice, you have to compete ... but again, there's the affordability is sue," he acknowledged.

General manager of Texchem Mega Consultancy Sdn Bhd, Ms Janet Lim,said she saw no reason why companies shouldn't advocate this new system if their financial resources were in place.

"The world is changing, people are changing ... so accepting this system is actually just moving with the times," she opined.