The Season for ERP Solutions

The season for buying, purchasing and the season for inventory control are now.  The season for change is now.  Now is the time for the changes you need to make to better prepare yourself and your organization for the next season. 

 

The season of change is now.

 

When a business has a consistent yearlong demand for its products, planning is a little easier with the right tools.  After all if you pick, pack and ship a thousand units a month and you know your suppliers lead time and balance order point with applicable discounts, the purchasing effort can be automated.  You can ensure that you have enough inventory to meet demand, but not too much that warehouse space is wasted or consumed where other products could be better stocked.

 

When a business’ products have seasonal demand, the challenges increase.  Add another level of complexity when the seasonal products are perishable, such as found in the food industry.  Productivity has increased importance as does handling.  The need to drive operational efficiencies increases as the penalties for not doing so become increasing cost prohibitive. 

 

Some organizations in food processing are still using the look-and-see method of reordering.  Someone who has been in the business a relatively long time walks through the warehouse or is able to keep a running count in their head and orders what they think is right at that time.  Chances are if they have been doing this long enough they may be accurate.  They may also not be.  What happens when this person goes on vacation?  What happens if they take a leave of absence?  What happens when they retire or are suddenly not able to work anymore? 

 

How do you transfer someone’s gut instinct into a reproducible formula for optimum inventory levels?

 

The challenges of the supply chain have not fundamentally changed since the beginning of commerce.

 

What has changed is the need for quicker access to greater and greater amounts of information.  The need for mobility and anywhere access.  Analytic analysis of the repository of information collected to identify and respond to new business demands.

 

 

The season of the switch.

 

 

New business environments require a comprehensive set of integrated, cross-functional business processes.  There needs to be an alignment of both strategic and tactical operations to improve productivity and insight, reduce costs through greater efficiencies and flexibility in computing environments. 

 

Industry requirements are constantly changing and new systems are needed to meet those demands and reduce risk through improved financial management. 

 

The benefits are more profitability, peace of mind and a restful night of sleep.

 

The solution starts with a solid foundation of financial management.  Add to that advanced options in distribution management.  The end result is a system that integrates the entire operation.  Better integration means superior customer service levels. 

 

A happy customer should be the goal of any solution.

 

Inventory management with comprehensive sales analysis and forecasting enables a more strategic approach.  Are you achieving your goals for inventory turnover?  How well do you meet customer demand?  Do you have what they need when they want it?  Do you have excess inventory taking up space and increasing overhead?

 

There are different seasons for inventory and seasons for Enterprise Resource Planning (ERP) solutions. 

 

What worked well years ago may not be able to keep up with demand or the changing landscape of commerce today.  The overhead of maintaining an older system can often outpace and out cost a new system optimized for your industry.

 

All businesses struggle to some extent somewhere along the business cycle.  Each business has their challenge spot.  A fresh set of eyes and thorough analysis can reveal these bottlenecks and open the door to increased efficiencies and profits.  Profits that can be reinvested to further drive efficiency. 

 

Experience has shown that the more of any business that is integrated into a single system the better that organization is capable of operating.  What we do not know is where your organization struggles without talking with you. 

 

Is your season of change upon you now?  How will you address the challenges of the next season?

 

Contact Dolvin Consulting today.  Not tomorrow, not next season.  We are here to listen and help.  We are not here to tell you how to operate your business.  We are a resource that you can utilize to identify areas of improvement that will help you compete more effectively with your competition enabling you to fulfill your customer’s needs.  A happy customer is a loyal customer.

 

Hot, Warm and Cold

Hot, Warm and Cold ERP (Enterprise Resource Planning) responses.

What constitutes the need for an emergency response?  A system failure can range from an inconvenience to a failed business.  Length of down time and the amount of data loss will typically factor heavily in the business impact.

 

In planning for disaster, roles must be defined in conjunction with the recovery procedures.  Who will be in charge, who will determine the impact, which person will be responsible for status updates?  Has the notification chain been created and tested?

 

The Hot zone is where the incident occurred.  In an online, virtual world this may not be your place of business.  Disasters can occur to cloud or hosted providers as well.  Up time and available time are two separate categories of availability.  In cases of natural disaster does the affected operation have a disaster recovery site geographically separated from business operations and the point of failure or disaster?  Have key personnel been identified and do they have access to the alternate site?

 

The Warm zone is a transitional area between Hot and Cold sites.  This may be a physical area or virtual area.  It may be the same location in cases where there is a system down, but no physical damage.  In cases of natural disaster is often a safe place near the disaster where status can be checked, yet far enough away to not be in harm’s way. 

 

The Cold zone is either a neutral area or the remote area where responsible people can delegate recovery tasks and notify users, customers, suppliers when necessary of status updates.  This is where press releases can be issued, personnel and resources coordinated and delegated.

 

Priorities varry depending on the extent of the disaster.  In cases of physical or natural disasters first priorities should be to the health and well being of personnel, then protection and recovery of resources.  In cases consisting of physical or operational equipment failures these steps are typically not necessary.  The next priorities are to assess the problem, determine its impact and to estimate recovery times for partial and full recovery.

 

First thoughts.  What is/was the hazard, disaster or affected resource?  Have the responsible people been notified?  What resources are at risk, what resources are likely to become at risk?  What is being done to contain the risk?  Who is coordinating the emergency response?  Are there others that need to be notified? 

 

Support functions.  What resources can be notified to provide support and recovery? Are emergency response personnel to be notified?  How and which communications methods can be used to notify employees, customers and suppliers?  Who and how are facility and equipment repair and remediation personnel notified?  What other resources can be contacted for immediate or future response?

 

Public relations.  Does the disaster or incident require a public relations media expertise to notify the affected parties and mitigate the loss of reputation?

 

There are many aspects to any critical interruption in service.  There are many ways to prepare.  The point to first consider is if your organization has acknowledged the possibility and has consulted with others to create a recovery and continuity plan. 

 

Businesses come in all shapes and sizes as due risks.

 

1.       What are you doing now to prepare? 

2.       What can you do now to prepare? 

3.       What will you do to prepare? 

 

We would like to hear your thoughts.   Please share your comments in this blog.  We would love to hear your feedback.

 

Finance Software Integration

When I describe Enterprise Resource Planning (ERP) software with people I often make the analogy that ERP is to the enterprise what office suites are to the desktop.  ERP integrates an organization based on department or functional roles so that one hand knows what the other is doing.  Similar to how a workstation database, spreadsheet, word processor and presentation programs can share information instead of having to rekey it in each application.  It saves time, increases accuracy and improves efficiency.

 

Within an ERP system the financial application particularly General Ledger tends to be the mortar between the bricks, where the bricks are the other applications.  Sometimes the ERP system consists only of financial applications, however, in today’s highly competitive environment the more functional roles that are included the greater the efficiency.  Having the other applications tie into the financial module really enables meaningful dashboards.  Finances give an unbiased view of business operations.  The more highly integrated with application interfaces and automatic posting, the better management opportunities exist.

 

Finance is often referred to as the Back-Office.  It is the behind the scenes company operations that are critical.  Purchasing cannot operate without payables handling the payments.  It does no good to ship orders if the proper credit application and collection resources do not exist.  Inventory valuation, write off and variance accounts for the company’s ability to borrow and fulfill customer orders.  Too much inventory and there is excess overhead, too little and business opportunities may be missed.  Finance gives an unbiased analysis of the company’s efficiency.

 

Functionality is a critical component of any system. 

 

How well does the software match operations versus how much change in operations are necessary to match the software.  This is no simple statement. 

 

The implementation of software can run from one extreme to another.  At one end the software is implemented and the company updates its processing to match the software.  This provides software stability and enables relatively easy upgrades.  On the downside if the software does not match operations the company will have to make some potentially painful adjustments to the way it operates.

 

At the other end of the spectrum is a company that develops their own system.  This system matches exactly the operations and is like hand in glove.  The problem that typically occurs is that the technology can become outdated.  Upgrades, if they even exist, require reapplication of the modifications and can significantly increase the costs to stay current.  If the software is completely custom, then adding new functionality often requires bringing in experts in new technology to learn and understand how the two can be integrated.     

 

Most companies fall between the extremes.  We like to see a 95% or better match between software and company operations.  At this threshold the software is matching the majority of the way the company operates giving stability and upgrade paths to the business.  The modifications tend to be light in nature and more easily managed.

 

There are cases when custom solutions are necessary, but they should be carefully planned and evaluated to ensure the Total Cost of Ownership (TCO) is evaluated.  

 

Another key question to ask is how well does the new software fit the culture of your organization?  How many steps does it take to process a payment?  Are accounts updated in real time or at some defined batch point in time?  Do you need multi currency support?  Are you working in multiple time zones?  Or, are you a single location facility?  How well does the software meet any industry regulations? 

 

There are software solutions to match each. 

 

Regardless of the match, business growth tends to be the common driver for any change.  Changing systems, finance, ERP or other is not a comfortable process.  It takes careful planning to make a successful transition.   Growth is good, keeping up is the challenge. 

 

The process of change can be painful, but staying put is typically more painful.  How hard is it to operate the current software?  Does it meet your needs?  How many manual processing steps are necessary to keep up?  The fit has to be right.  It has to be relatively easy to operate.  Be flexible enough to address the inevitable future changes you business will face.  Support from your software supplier is very important to consider.  How do they provide training and implementation support?  Are they large enough to develop new enhancements, yet small enough to answer the phone with a real person?

 

Is functionality an issue?  Is out dated technology a driver for change?  Is native growth or merger and acquisition a factor?  What costs are associated with your current solution versus anticipated costs of a new system?  What is your competition doing to serve their customers and win over your customers?  How fast can you react to market change?  Are you now operating in multiple locations? 

 

Cost savings from operational efficiency and reduced maintenance should be included in any analysis as well as departmental or personnel consolidation.  How many people does it take now to manage the finance department and why is that?

 

Your customers are demanding a change whether you realize it or not. 

 

Customer service should be at the heart of any change.  Every person and operation has one goal.  That goal is to serve those who pay the bills, your customers.  What good is a more efficient operation, if you cannot increase your customer’s satisfaction? 

 

Bottom line is that you need a trusted advisor that will take a fresh look at your operations and help you document your operations.  A good match for a new solution is made on knowing what you are doing now and what needs to change.

 

Dolvin Consulting works with industry experts to help you find solutions to the challenges you face.  All organizations struggle somewhere.  All different, but consistent when they want to grow.  Contact us to see how we can help you find new solutions.  We are here to help.

 

New Realities of Replacing your Accounting System

White paper titled "New Realities of Replacing your Accounting System" from Whitepapers.com is an interesting and informative read.

The eBook covers:
•The total cost of ownership—what are the real costs of running finance in the cloud?
•The top concerns including security, downtime, and control—and how do you mitigate these concerns?
•How to think about customizing your software in a cloud world.
•How do you customize cloud computing solutions to fit your business needs?


Contact Dolvin Consulting for help with your accounting system needs.  We listen and are here to help.

The Security Concerns are Real Enough

Are hosted or cloud solutions secure?  Secure enough for your information?  We are not talking about the business next door.  We are talking about your livelihood.  These are not the same questions related to how appropriate or practical a hosted solution may be. 

 

There are many concerns related to hosted or cloud solutions.  Most would agree that it is a question of time and not if, but when the scales will tip towards a hosted solution.  A hosted solution that handles the primary line of business solution versus a subset of processing.   

 

Size does seem to matter in this case.  Larger enterprises tend to prefer handling their needs in-house where they can control all the facets of operations, integration and security.  Mid-sized corporations tend to have a mixed use and need for hosted solutions, where the type of business operations drives those decisions.  The smaller business tends to embrace the technology quicker.  Budget, of course, and available resources play a big part in these decisions.  Public social media forums are in a category themselves and are not generally considered line-of-business.  Internal blogs and community forums are typically private.

 

Some of the top issues revolve around:

1.       How secure is it?

2.       Does it make sense?

3.       How will it change my business operations?

4.       Will my employees require more training?

5.       Does it fit my budget? 

6.       Will it reduce my costs?

7.       What happens if I run out of money?

8.       Who owns my data?

 

Security Concerns:

 

The security concerns are real enough, but are not necessarily related to hosted solutions.  Cloud or hosted solutions are often an eye opener to security concerns for on-premise solutions.  Many organizations do not pay attention to that box sitting there when it is inside their office.  The threats are real and the consequences of a data breach are the same regardless of the location of information.

 

Chief issues with hosted solutions, particularly for the smaller business, often revolve around selecting the no-charge or free versions that are really designed for consumers and not businesses.  The quest to save money and reduce costs creates gaps in security and separated and disconnected systems. 

 

Consumer services often lack enterprise support, encryption of data in transit and at rest and contract agreements.  Agreements and support to ensure that your business is as important to them and that they understand what it means if what you have paid for is up and running or not available.  Remember that up-time is not the same as available.

 

Disconnected systems increase costs and errors due to the lack of integration and the manual processes that typically are associated with separate systems.  These problems intensify when the online application does not address the central business challenges and are selected to address secondary needs.

 

Users generally want to be productive and like their own devices which open up gaping holes in security.  They like downloading and experimenting with different applications which ultimately can expose information that is supposed to be private.  If they use their own devices and your infrastructure is hosted, then how can you control what they download, what they share, what they may lose.

 

For example they may download an application that allows them to manipulate a spread sheet on their phone.  That application may be okay, but what about that game or other application that is also sitting on the same device that has the ability to read storage and open network connections on its own.  Add to that equation – did that employee violate policies by copying the information to that device.  Did they email it as plain text over an unsecure connection?  With the capacity and convenience of these devices did they just download your entire customer database to their smart phone?

 

It really does not matter where the data lies as long as it is secure and policies exist to define and ensure compliance.  Employees are trained, devices are secured and services exist to monitor and ensure compliance.   The solutions exist to ensure compliance, but an organization needs a policy first before a procedure can be applied.

 

You may not think there is value in the information you have, but others do and it is your responsibility.

 

At Dolvin Consulting we help make your employees more productive so your business can drive efficiency and be more profitable.  Contact us today to see how a fresh set of eyes can improve your operations.  You already know how to run your business, let us help you find better tools to mange it.