Seven signs your business has outgrown its systems
Businesses rarely outgrow their systems overnight; it creeps up through spreadsheets, re-keying and workarounds. Here are the seven signs I look for, and how to tell a system you have outgrown from one you have never used properly.
By Gary Kellett6 min read
For owners and directors of growing UK firms who feel their systems are slowing the business down.
Businesses rarely outgrow their systems in one go. It happens a little at a time. A spreadsheet appears to cover a gap. Someone starts keeping their own list because the system cannot show what they need. A month-end that used to take a day starts taking three. None of it feels like a crisis, which is exactly why it can go on for years.
These are the seven signs I look for when a director asks whether their systems are holding the business back. Just as important, at the end I explain how to tell a system you have outgrown from one you have simply never used properly, because the fixes are very different.
1. Spreadsheets hold the business together
Every business has spreadsheets, and that is fine. The warning sign is when a critical process depends on one: the pricing workbook only one person understands, the stock list that is more accurate than the stock system, the tracker that is the real record of who owes what. When the spreadsheet is the source of truth and the system is the copy, the system has stopped keeping up.
2. The same data is typed in more than once
If a customer's details go into the CRM, then the accounts package, then the job system, you are paying for that work three times, and each copy will drift. Re-keying is the clearest sign that your systems were bought one at a time and never joined up.
3. Nobody can answer a simple question quickly
Ask your team how many orders are late this week, or which customers have not ordered for three months. If the answer takes a day and three exports, the data exists but your systems cannot bring it together. Growing firms feel this sharply, because the questions get harder just as the answers get slower.
4. Month-end and reporting keep getting longer
Reconciling by hand, chasing missing paperwork and building the board pack from exports are all symptoms of systems that do not share data. If closing the month or producing reports takes longer every quarter, faster than the business itself is growing, your systems are not scaling with you.
5. Workarounds have become the process
Listen for phrases like 'we do it this way because the system will not let us' or 'you have to remember to'. Each workaround depends on someone's memory. When a key person goes on holiday and things start to slip, the workaround was holding up more than anyone realised.
6. Every new site, product or team is a project
Growth tests systems. A new branch, a new company in the group, a new currency or a new way of selling should mostly be a configuration job. If each one turns into a project, or the vendor's answer is a much more expensive tier, the system may genuinely be the wrong size for where you are heading.
7. Nobody knows what you pay for
When subscriptions are spread across card statements and departments, licences pile up for people who have left and for tools that overlap. If you cannot list every system you run, what it costs and who owns it, you cannot manage your systems, let alone plan what comes next.
Watch out: Count the signs, not the grumbles
One or two of these signs is normal in any growing business. Four or more, especially if they cluster around the same one or two systems, usually means it is time for a proper look at the whole estate rather than another patch.
Outgrown or under-used? How to tell
This is the most important part. Almost every sign above can come from a system that is too small for you, or from a perfectly capable system that was set up badly and never revisited. The fix for the first is replacement. The fix for the second is configuration, training and connection, at a fraction of the cost and disruption. Four checks will usually tell you which you are dealing with.
Step 1: Check the edition and modules you pay for
Many products include features in your current tier that would close the gap. Compare your invoice with the vendor's published feature list.
Step 2: Ask the vendor in writing
Describe the gap and ask whether the system can handle it. A clear no is evidence. A 'yes, here is how' is cheaper than any replacement.
Step 3: Look at how the team really uses it
If people use a handful of screens and nobody has been trained in years, the system is under-used, not outgrown.
Step 4: Test it against the next two years
Think about the sites, volumes and ways of working you expect. If the system can stretch to them with configuration, keep it. If not, plan its replacement calmly, before it becomes urgent.
Worked example
A wholesaler with a growing online channel believes it has outgrown its stock system, because web orders are copied in by hand each morning. The stock system can do the job; what is missing is a connection between the web shop and the stock system. A modest integration removes the re-keying, and a replacement project, with its migration and retraining, is avoided. Had the stock system been unable to run a second warehouse the firm was about to open, the answer would have been different.
What to do next
Start by writing down which of the seven signs you recognise and which system each one points to. A pattern usually appears quickly: one or two systems attract most of the complaints, and a couple of connections are missing between them. Share the list with the people who do the work, because they will know about workarounds you have never seen.
If you want an independent view of the whole picture, my Systems Health Check looks at every system you run and gives each one a clear verdict: keep, configure better, connect, replace or retire. It finds the licences you pay for and do not use, the places where data is re-keyed, and sets out a costed roadmap in a sensible order. It is a fixed price, and it tells you whether you have outgrown your systems or simply need to get more out of them.
Questions directors ask
How do I know if my business has outgrown its systems?
Look for critical spreadsheets, data typed in more than once, slow answers to simple questions, month-ends that keep getting longer, workarounds that depend on memory, growth that turns every change into a project, and subscriptions nobody can list. Four or more of these, clustered around the same systems, usually means it is time for a review.
What is the difference between an outgrown system and an under-used one?
An outgrown system cannot do what you need, even with configuration, and the vendor confirms it. An under-used system could do the job but was set up badly, never connected to other systems or never taught to the team. Under-use is fixed with configuration, training and integration, at a fraction of the cost of replacement.
Should I replace my systems before the business grows further?
Only if your current systems cannot stretch to the volumes, sites and ways of working you expect over the next couple of years. Otherwise configure and connect what you have, and plan any replacement calmly rather than in a crisis.