It’s no secret that too many ERPs fail to live up to expectations – or simply fail altogether. One reason is the mammoth array of skills and competencies an ERP implementation requires to succeed.
Driving business transformation through ERP necessitates having a vision for how the business will evolve in the future. To make that vision a reality, you need an all-star project team that can excel across the required skill set: technical know-how, project management, business process reengineering and organizational change management.
Most companies don’t have the resources to develop all of these capabilities internally. That’s why smart organizations turn to ERP consulting partners to augment their internal resources and abilities. Still, much of the expertise required for a successful ERP implementation can be just as difficult to find in ERP consulting firms.
Here are a few tips to help determine when and where it may be most appropriate to outsource your ERP implementation, and how to evaluate the best partners to help you lead your organization to ERP success:
Know yourself – take an honest look at your internal resources: Do a rigorous assessment of the caliber of skill and ability of your in-house team, compared against the skills required for a successful ERP implementation. Realistically evaluate areas of weakness – these skills and tasks are the ones you’ll want to consider outsourcing to ERP consultants. Define roles and responsibilities early in the planning process, prior to beginning your ERP implementation and deployment.
Value business smarts as much as technical competency: Functional and technical software skills are critical – but not the end-all, be-all all to a successful ERP implementation. ERP success relies less on how well the technical aspects are handled during the implementation, and more on how the business components of an implementation are executed.
See the big picture – people and processes matter: Functional expertise, technical proficiency, and software-specific skills are important. But configuring software is relatively straightforward. The people and process aspects of an implementation – such as communications, organizational change management, project management and business process reengineering – are much harder to pin down. These skill sets are also harder to find – many ERP consulting firms simply can’t offer competencies in these areas. When looking for outside help, it is critical to find a partner that not only has a comprehensive technical skill set, but also a proven methodology to help address all the other critical aspects of a successful ERP implementation.
You don’t need to outsource everything – be discriminating: Rely on outside assistance when and where it makes sense. Even the most talented external consultants can’t make decisions for you about how to run your business. It’s your project – you need to provide the appropriate level of internal expertise and support. You need to identify the skills and responsibilities your internal team can provide, and recognize those that ought to be outsourced to outside parties. Only people within your organization can judge whether the ERP system as designed does exactly what you want it to do.
Make no mistake: Assembling the collective aptitude and proficiency needed to bring an ERP implementation home successfully is a huge challenge. Start by being honest about what you can and can’t do, and what you know and don’t know. Understand that people and processes are as important as technical prowess, and choose which tasks to keep in-house and which to outsource. You’ll set the stage to leverage your internal team effectively, partner with the right ERP consultants, and lead your organization to a successful ERP implementation.
Your “trunk stock” is mobile – trunk stock inventory management should be too
Merchandise that a sales rep carries around for demonstration or immediate sales is called “trunk stock”. A rep might carry this inventory in rolling cases, or even in an actual trunk. Inventory that a life sciences sales rep keeps on hand is referred to as trunk stock.
Medical device manufacturers have to contend with managing a complicated and potentially costly type of trunk stock inventory. For example, during implant surgeries, physicians typically use only 25 percent or less of the products provided in the implant surgical kit. The idea is that the practitioner is totally prepared for unexpected events – this is a good thing. The problem for the manufacturer comes when unused items must somehow be returned to active inventory.
Typically, unused surgical kit products must be sent to a centralized facility to be cleansed, sanitized, reassembled as necessary, repackaged and eventually re-stocked. This kind of trunk stock is actually a time intensive consignment inventory management exercise with plenty of opportunity for errors.
Poor management of trunk stock consignment inventory results in higher costs for both suppliers and their customers:
- Suppliers – lack of visibility into product or component consumption; labor intensive manual processes; ineffective consignment management
- Customers – overstocking; expirations and write-offs; missed charge capture and clinical documentation
Better consignment inventory management – anywhere, on any device That’s why Strategic provides a mobile-enabled QAD bolt-on application that makes trunk stock and consignment processes automatic, simple and accurate.
Strategic’s “Mobile Trunk Stock App” automates all the tedious, error-prone manual processes associated with ordering, transferring, shipping, and replenishing consignment inventory. The module is designed for mobility, ensuring users high performance and real-time data access anywhere on any device. The Mobile Trunk Stock App can be deployed in the field on mobile devices or in the office in a client/server model.
The Mobile Trunk Stock App provides visibility into and management of all consignment inventory, including leased and loaner inventory. The application seamlessly moves inventory from warehouse to consignment trunk stock location and creates neutral financial transactions for trunk stock sales orders.
Automate consignment replenishment:
- The replacement order for the item being billed to the designated consignment location is created automatically.
- During the billing process the user can identify if the inventory should be auto replaced. If auto replacement is selected, the module automatically creates the replenishment order for the proper consignment location.
You can easily customize trunk stock shipment processing:
- Shipping can process consignment orders as normal shipments -- no second process for consignment is needed.
- The module processes receipts into representative/hospital locations for consignment sales orders only; it automatically creates the location if one does not exist.
Strategic’s Mobile Trunk Stock App meshes seamlessly with your QAD ERP, and utilizes standard QAD reports and browses. It’s so quick to implement, you can be up and running, making the most of consignment inventory management, in just days.
In New Orleans, they always laissez les bon temps rouler – and the 2014 edition of QAD Explore customer conference held there on May 5 – 8 was no exception. We’re talking about great educational sessions and valuable insights into QAD’s product vision and direction.
A highlight of the conference was seeing long-time Strategic customer and QAD user Toni Clubb, CFO of Vitatech, recognized for commitment to innovation with QAD ERP.
As always, the conference delivered actionable information about making the most of QAD systems.
Transitioning from on premise to cloud ERP was an especially hot topic, from building the business case, to “life after migration”. QAD continues to demonstrate a keen understanding of what transitioning to the cloud means for life sciences manufacturers. Quality management also continues to get the spotlight.
Modules like QAD Item Attributes, QAD Serialization and QAD Lot Trace Workbench provide capabilities that improve business performance by integrating compliance processes with business processes. QAD Enterprise Financials offers new and better ways to report smarter and close faster, drive operational efficiency and guarantee compliance. And, as big data continues to get even bigger, analytics is a topic of growing interest – QAD continues to strengthen the analytics capabilities of its BI solution.
Just as QAD works to keep its products and services at the forefront of manufacturing ERP, we at Strategic are continuously improving our tools, processes and methodologies to help you maximize the value of your ERP.
Contact your Strategic account executive today to find out how we can help you get more from your QAD solution.
Find QAD Explore 2014 session recordings and materials online. CLICK HERE for QAD Explore session recordings and materials online
QAD Customers are invited to visit Strategic Information Group in booth #301 at QAD Explore 2014 in New Orleans on May 5-8, 2014.
Here are the top 3 reasons why you need to be there!
Network with QAD's global community of leading manufacturers.
At Explore, learn how QAD and Strategic Information Group are working today to help your company become a more Effective Enterprise.
Listen to Strategic Information Group's experts speak at this event:
Tuesday, May 6th at 2:45 p.m. in Theater 1
Wednesday, May 7th at 1:30 p.m. in Theater 2
- Ray Greenwood, Senior Vice President Consulting Services, Strategic Information Group
- Amy Vasquez, Senior Solutions Architect, Strategic Information Group
Topic: Enhancing QAD with SIG Extensions:
Explore the high value add “gap killer” bolt-on’s from SIG. Learn about SIG’s many extensions to QAD such as our Mobile Trunk Stock, FedEx/UPS/USPS Integration, Salesforce.com Integration, FDA Validation Toolkit, Shipping Compliance Module, Approved Vendor List, Browse/Forms Starter Kit, Sunshine Act Compliance Module, Concur Integration, PLM Integration and more.
ERP in the cloud offers a low cost, high performance alternative to on-premise enterprise software – with less effort and risk. Today’s cloud ERP solutions securely and reliably deliver all the capabilities manufacturers need to improve response time, meet compliance requirements, increase customer satisfaction and drive measurable performance.
Cloud-based solutions and services are easy to deploy, integrate and upgrade -- and they don’t require additional investment in IT infrastructure and staff. Cloud ERP offers high availability and predictable expense, helping you minimize your risk while maximizing return on investment. Bringing your business into the cloud can be especially beneficial for businesses that anticipate rapid growth, have limited IT infrastructure, seasonal spikes or multiple locations. Cloud solutions also free up your existing IT resources to focus on key high-value business initiatives.
Cloud ERP may not be a fit for every business – and on-premise ERP is not going away. Still, cloud is a key consideration in any ERP strategy. A cost-benefit analysis can help determine if cloud is right for you. Often, a guided analysis uncovers hidden costs that can be easily eliminated with a cloud ERP solution.
10 considerations Strategic recommends for your cloud ERP strategy:
1) Time to migrate or upgrade: When your system is at the point in the ERP lifecycle where you’re considering an upgrade or migration, it’s a great time to rethink your ERP strategy and consider moving to the cloud.
2) Industry-specific requirements: Recently, ERP SaaS adoption has picked up considerably in life sciences and other sectors that require strong compliance capabilities. Be careful though -- not all cloud ERP solutions provide compliance capabilities. QAD Cloud ERP does offer a single tenant, private cloud solution that is unique in the industry.
3) Infrastructure tradeoffs: By limiting the need for extensive IT infrastructure, cloud ERP can help reduce network costs. Considerations include compliance, security and ensuring adequate bandwidth and Internet access.
4) Know your clouds: The two major types of clouds are: private, for the exclusive use of an organization, which is typically single tenant; and public, multi-tenant. Companies can only maintain change control of their cloud environment in a private, single tenant cloud environment.
5) Consider a hybrid approach: Another option is for companies to use a combination of on premise and cloud ERP. A recent Forrester survey of 2,403 IT decision-makers showed that 10% of planned implementations will use cloud ERP to complement on premise ERP.
6) Cost considerations: One reason cloud ERP is an economical solution for small-and-medium-size businesses or start-up companies is relatively low initial TCO. Implementation, consulting and overall acquisition costs are all more affordable.
7) Accessibility needs: Cloud ERP provides tremendous flexibility in terms of enabling user access anytime, anywhere.
8) IT resources: Even with all the right skill-sets, on premise ERP requires far more resources than a cloud deployment. For many, the convenience of cloud deployment helps the IT team extend their reach and capability.
9) Customizations: Industries where there are highly complex operations public multi-tenant cloud environments may not be a good fit due to the level of customization that may be required. Private cloud ERP, such as QAD’s solution, is best suited to enterprises that need a high degree of customization.
10) Fast time to value: Faster deployment means faster return on investment (ROI) from system and process improvements.
Every new ERP project begins with purpose, direction and anticipation. A successful implementation means streamlined processes, more efficiency, reduced waste, better customer service, bottom line savings and top line growth.
But over time business needs change, and an ERP system can lose its edge. System performance starts to lag. Or competitive advantage erodes as early adopters in your industry implement newer technologies. When your ERP stagnates, so does your business performance.
Avoiding ERP stagnation takes more than good intentions. Ongoing success requires a strategy, a plan, specific goals and the appropriate resources.
What are the top five mistakes that lead to ROI draining ERP stagnation?
1. Failure to evaluate and refine business processes – Many companies have no real idea how their business processes work in practice. Identify opportunities for continuous improvement and uncover areas where additional ERP functionality could be applied to the business. Don’t let software define your business processes for you.
2. Forgetting to foster employee success – Ongoing training and certification for users helps them maximize the value of your ERP investment, provides professional development, and keeps valuable resources fully engaged. Remember, software can’t replicate institutional knowledge -- talk to process owners.
3. Lack of an upgrade strategy and plan – Too often, organizations don’t do a thorough ROI analysis. The decision to upgrade is a commitment that needs to satisfy three key requirements: How will business operations benefit? Can the organization execute the upgrade effectively? Do you have a clear upgrade project strategy and plan in place?
4. No understanding of change management – Change management is never over. Manage expectations. Sometimes it’s the culture that has to change.
5. Losing sight of emerging technology –Is on premise ERP better for you, or are you ready for the cloud? Cloud ERP seems simple yet so complicated – dedicated cloud or hybrid cloud, public or private? What about mobile ERP and managing bring your own device (BYOD)? Will regulatory changes require additional services or new modules? How do you plan to manage your data and extract meaningful information from it? Are you ready to think about big data, business intelligence (BI) and advanced analytics?
6. Not getting the right help at the right time – We started out talking about five top mistakes – but not calling on your trusted ERP partner is also a mistake. It makes sense to keep up with technology improvements. And you don’t need to constantly change your operations because of new functionality, technology platforms or regulations. You can benefit from guidance on best practices, processes, and taking user needs into account. We can help you anticipate changing internal and external business needs, evaluate new processes and functionality, and measure results. Don’t let your ERP go stagnant. Contact Strategic today.
Engaging the services of an independent consultant is often the best approach to making your ERP project succeed. In those cases, it’s a beautiful thing. But sometimes, independent consultants come with baggage that reveals a more beastly side, dooming your project to abject – and costly – failure.
Independent ERP consultants are in business to help companies make the most of their ERP implementations. Like any vendor or business partner, the value delivered may not always be the value you expected. That’s why it’s important for you to own your project, evaluate promises and manage communications and expectations with both internal and external teams. It is also critical to understand the dynamics that can arise between different players, and plan to manage them effectively.
So how do you know when a decision to hire an independent ERP consultant is a going to lead to a happy ending – and when it’s a deadly project risk? Let’s examine a few common situations that can conceal deadly pitfalls:
Driving better outcomes by managing your autonomy: Remember, you are in charge of the overall project. Don’t let an ERP project sideline your team and take focus time and resources away from your core business. Set expectations with all parties from the beginning and check in often to keep everyone on the same page. Lay out terms and conditions when contracts are signed, and establish agreements on all sides for roles and responsibilities.
Assessing consultant-OEM partnerships: When selecting and implementing ERP software, working with a firm that has solid partnerships with their OEMs can be a good thing. But too close of an association with an ERP vendor package can be a sign of trouble.
Educating senior management: Relying solely on an ERP software vendor or independent consulting firm to educate your management is not as convenient as it may look. In fact, ERP education should have little to do with software, and nothing to do with a particular package. The problem is, a sales pitch disguised as education may leave senior management believing the package the vendor is pushing is the "ideal" ERP example.
Scoping service needs accurately: Beware of add-on services. Independents can provide sound advice within predefined project roles – problems arise when your consulting partner starts talking you into paying for additional services your project team could handle, or that you just don’t need.
Managing communications and collaboration: Evaluate potential consulting partners for their ability to provide truly independent views throughout the project lifecycle. Evaluating multiple, independent perspectives throughout the process -- from vendor selection to implementation to optimization -- helps you truly validate progress and flag concerns before they become crises. Know when to leverage your consulting partner’s non-affiliated voice to point out when and where you need to step up, to review the project plan and analyze results. Unfortunately, there are times when an independent firm working on a client's behalf with the primary provider encounters politics or other conflicts. If the client management and project teams begin to take sides, this can become especially very disruptive to a successful ERP project. Allow for independent views and provide political empowerment.
Ideally, your ERP consulting partner is smart enough to know what they know, and what they don’t know. This means understanding what your business really needs -- not just what they think they can sell you. It means taking that understanding and realistically evaluating how their firm’s talent and vendor partnerships can best be combined to help you run your business better today and leverage ERP for a beautiful future.
An effective ERP implementation is a critical success factor for the typical manufacturing organization. Using an independent firm should add value to your ERP project. But failing to understand and manage the potential pitfalls can do serious damage to any project and leave you managing a beast. Teaming with the right independent ERP consultants can help you work smarter and produce beautiful results.
Today’s ERP gives enterprises of all types and sizes access to enterprise-class software technology. But the promised benefits often come with distractions and pitfalls for the unwary.
The decisions you make today – about upgrading, ERP add-ons, ongoing user training or choosing a consulting partner – determine your ability to get the most value from your ERP system tomorrow and in the future. It takes a special kind of intelligence to successfully negotiate the mean ERP streets.
You need to know what you know and what you don’t know. Keep your antennae tuned to economic and industry trends that will affect your business and industry. Know which questions to ask and when. Examine all claims made by solution vendors or consultants.
These ERP street-smart tips will help you look sharp, think fast and get the most of your ERP system.
Manage for continuous improvement: Much of the benefit of ERP comes from continuous improvement gained by refining business processes and ensuring best practices. Understanding and refining your business processes and examining how ERP can facilitate or improve them is one of the most important things you can do to maximize the value of your ERP.
Know when it’s time for an upgrade: Too often, businesses subsist on outdated systems because the fear of disruption to the business obscures the benefits of upgrading. Has keeping your system updated become costly and time-consuming? Do your users have remote access to data? Can your suppliers and other trading partners interact with your system? Leverage your maintenance dollars wisely. An ERP system should eliminate complexity and duplication of effort, while facilitating product quality and customer service.
Educated users make your system more intelligent: Ensuring user success with your ERP is a key driver of competitive advantage. Give your users the training the tools they deserve so they can leverage your ERP system and business processes intelligently and effectively. Too often, companies rely on ‘tribal knowledge’ training to educate new employees. This can lead to process shift and a general lack of understanding in the system.
Get smart about ERP add-ons: Sometimes, key benefits a company wants from an ERP implementation are not part of the purchased ERP package at implementation. ERP add-ons – like CRM, advanced supply chain management and vendor relationship management – provide very specific functionality or technology to complement ERP systems. Add-ons, whether new modules or other “bolt-ons” can help extend the value of an ERP system – but you‘ll need to watch out for functionality and interface pitfalls.
Extend the access to ERP data: Cloud-based, mobile and social capabilities extend the power and reach of today’s ERP solutions, giving users access to critical information from anywhere – user training can make the difference between successful and mediocre outcomes.
When considering a consulting partner, choose wisely: Your ideal ERP consultant will truly add value to the important decisions that can make or break your ERP system. Look for a partner with a proven track record – and the references to back it up – of helping clients get the most value from their ERP systems with upgrades, add-ons, ongoing training, and decisions about evolving opportunities with cloud, mobile and social ERP. The partner should provide both ERP product knowledge and project methodology to the ERP endeavor. Get ERP street smart and stay that way: Leverage your consultant to learn what you need to know to make the most of your ERP system.
Growing enterprises that adopt ERP can reap significant reward for the risk. So why does ERP have such a sketchy reputation? Claims that it’s not up to date, hasn’t changed in twenty-five years, that consultants don’t help, and other outdated myths and fairytales.
Today’s ERP solutions are more flexible and agile than ever, and make the most of new technologies like cloud and mobile. That means businesses from small startups to established enterprises can find an effective, right-sized solution that delivers maximum ERP benefits.
It’s time to reexamine some antiquated ERP misperceptions – and adjust expectations of what software and implementation partners can truly accomplish. Understand common myths and misnomers about ERP applications and implementation partners, learn to ask the right questions up front and enjoy a successful ERP track record.
ERP Fairytale: "Our implementation partner will make us successful." Reality: Your ERP consultant will educate and coach you -- but only you have direct authority and control over outcomes for your business.
ERP Fib: “We need more consultants.”Reality: Most projects do not need more experts: they need more solutions. Too many consultants can overpower the knowledge and experiences of client employees. When the client feels like their concerns are not being heard, it’s a sure sign the consulting partner should be focused on customer needs and objectives.
ERP Fantasy: “ We need our consultants to lead the project.” Reality: The project owner – you – needs to take leadership. Your implementation partner is there to facilitate your ERP selection and implementation. Leverage your consultants to learn everything you need to know to make the project a success and achieve your business objectives. Facilitating ownership requires the consultant to provide education, software knowledge transfer, and establish client resource commitments.
ERP FACTS – In reality, only you can:
- Own and communicate the business case and change drivers.
- Clearly define and communicate project objectives.
- Approve and contain the project scope.
- Limit software modifications – keep it simple.
- Implement and manage changes in operating paradigms, business processes and employee behaviors.
- Engage the cooperation of employees at all levels of the organization.
- Assemble the right internal team to the project.
- Provide internal project team with time and appropriate resources to succeed.
- Hold functional managers and the team accountable
- Manage and utilize implementation partners effectively.
- Tackle project issues and decisions in a timely fashion.
- Engage your staff in taking end-user training seriously.
- Develop a project plan with major milestones that take 6 months or less to achieve
SMB (small-to-medium business) manufacturers – and the SMB segment in general – are getting lots of attention in ERP circles. A common theme is the discussion around whether smaller businesses are unique animals, with unique functionality needs relative to larger enterprises. Many assume all SMBs have fewer processes, are less complex, have less stringent customers, fewer regulatory requirements, and simpler organizational structures. But is that assumption accurate?
For any enterprise, regardless of size, ERP system requirements are a choice – a business decision. Requirements should be driven by the types of business processes within the organization, the complexity of the processes, customer needs, and other key attributes of the organization. The choice may also be shaped by spending limitations, how management views the role of information systems, and the company culture.
There is no proven direct relationship between company size and system needs. In many cases, smaller businesses do not have different requirements; they choose to address them differently -- sometimes outside the ERP system. It is not unusual for a small-to-medium size business to have robust software requirements that can only be satisfied using advanced modules in a Tier 1 package. And, just like their larger counterparts, SMBs are driven by a demand to better analyze and leverage their enterprise data.
It’s a common misperception that small companies require fewer management controls. In fact, to manage increased regulatory compliance and customer expectations more SMB companies are trading in their small business solutions for ERP packages that manage sophisticated requirements such as FDA compliance, lot tracking, bar coding, and EDI transactions. Certain contracts may require full traceability of all materials, parts or other inputs. The need to track, trace and document the procurement, manufacture, and distribution of every finished product results in many more system transactions.
What does this mean for SMBs?
Don’t assume SMBs are universally different from other companies – the unique needs of each enterprise are shaped by industry trends, market forces, regulatory climate, customer demands and more.
An SMB that selects a software package that does not provide certain capabilities that could be used within the business will need to fully understand the implications of performing the tasks manually, outside the system, possibly using elaborate (and un-integrated) spreadsheets
Select a solution that can scale and adapt with business growth. Just because you can run the business on spreadsheets today, does not mean you can do so five years from now.
ERP software packages designed for the SMB market are delivering tangible return on investment through increased automation, paperless warehouse capabilities, comprehensive cost information, and ad hoc reporting. The increased ease of use in ERP software packages and the adoption of software as a service have made the transition to fully functioning ERP more feasible for the SMB decision maker.
Don’t let the Sunshine Act final rule catch you off guard!
The August 1st data collection deadline is just around the corner -- Strategic has a simple, fast solution for QAD users and customers using Concur
On February 1, 2013, the Centers for Medicare & Medicaid Services (CMS) announced the release of the final rule implementing the physician payment sunshine provisions on Section 6002 of the Affordable Care Act (ACA), currently named The National Physician Payment Transparency Program: Open Payments. Most refer to the program as the Sunshine Act.
The intent of the Sunshine Act is to bring potential conflicts of interest to light with the goal of driving down healthcare costs. Under the new program, “applicable” manufacturers of covered drugs, devices, biological products, and medical supplies that participate in U.S. federal health care programs must annually report to the CMS information regarding payments, ownership, investment interests and other “transfers of value” to physicians and teaching hospitals. In addition, manufacturers and group purchasing organizations (GPOs) must report certain ownership interests held by physicians and their immediate family members.
Applicable manufacturers are required to begin data capture on August 1, 2013, and submit their first federal reports by March 31, 2014. Most reported information will be published by CMS on a searchable public website beginning September 30, 2014, increasing pressure to comply. CMS stated in the final rule that it will provide more information and guidance on the reporting requirements and timing of data review and correction.
These are a few of the major requirements addressed in the final rules:
- Which payments or other transfers of value are subject to reporting, and the specific data elements that must be included for each
- Guidelines for reporting payments that relate to research, which must be reported separately, with additional data elements including the study name and principal investigator’s name
- Which companies must submit reports and when related entities can file joint reports or must file separately
- Guidelines for companies that have “covered” products that are ancillary to their primary business
- Reporting obligations for contract manufacturers, distributors and wholesalers
Since issuing the final rule in February, CMS granted six months to prepare for compliance and begin data capture. Even so, collecting the data and preparing to submit the reports is a painful process for many companies. Complying with these national disclosure requirements is a huge undertaking.
Strategic is already assisting customers to meet these new compliance requirements successfully. Planning starts with considering business processes, systems and data needs, then identifying and mapping out the program components needed to effectively source, remediate and report the required information.
Sunshine Act Compliance module key capabilities include:
- Maintenance screens for users to create the records subject to the National Physician Payment Transparency Program.
- Import a CSV file from Concur or other source into the maintenance screen.
- Browse to review the payment records that have been recorded.
- Provide integration to the Supplier Invoice Create Maintenance screen.
- Develop the required reports for submittal (first deadline for reporting is March 31, 2014).
QAD and QAD users with the Concur add-on should take advantage of our “Sunshine Act compliance module”. The application supports the specific data collection requirements mandated in the final rule – and can be implemented very quickly to allow you to comply by the August 1 deadline. If you have any questions or doubts about how to comply with these new requirements, contact Strategic today!
The truth about ERP bolt-ons: Know the good, the bad and the ugly
Sometimes, key benefits a company wants from an ERP implementation are not part of the purchased ERP package at implementation. Business requirements may have changed for an existing system or the organization could benefit from specific new functionality. A business can get missing capabilities and extend the value of their ERP with an additional application or module, fondly referred to as a “bolt-on”.
ERP bolt-ons provide very specific functionality or technology to complement ERP systems. CRM, advanced supply chain management, vendor relationship management and HR are typical examples of bolt-ons.
Here are a few basic concepts to understand about ERP bolt-ons in general:
Not all ERP bolt-ons are equal. Like so many things about ERP, simplicity is elusive and things can get complicated fast if you’re not prepared.
Interfaces may be needed since the systems may not have been designed to work together in the first place. These programs physically extract, transfer, and load data between separate databases, on a less than real-time basis.
Integration implies that application programs utilize a common database, with minimal file duplication, and the data is update across the system in real time. Understand what your provider means when they say their bolt-on application is “fully integrated” with the ERP system.
Know the degree of real-time information your business requires in the application area in question. For some functions, lack of real-time integration is a hindrance to usability.
There are basically four ways to add specific functionality with an ERP bolt-on, and each has its own makeup of good, bad, and potentially ugly risks:
Implement an add-on module from your ERP provider: Usually pretty good A bolt-on developed by your ERP provider to add value to their core product will most likely be fully integrated, use the same platform, and have good support. To reduce implementation risk, some ERP consultants advise new customers to become competent with a core ERP package first, and later circle back and implement a bolt-on. However, if a very substantial part of your ERP justification results from a bolt-on module, you need to either implement the bolt-on at original go-live or find an ERP package with the desired capabilities built into the core functionality.
Install a module your ERP company has acquired: Not quite as good As an alternative to developing additional functionality within their base ERP offering, many vendors purchase third-party applications and sell the acquired software as a bolt-on module. During the integration period, acquired applications can be klugey; consider waiting for the dust to settle before jumping in. Beware of ERP packages constructed mainly of third party bolt-ons – they tend to have data redundancies and integration issues. When an ERP vendor routinely uses optional bolt-ons to provide “point solutions,” it could be a sign that their package is in a state of decline. During a software evaluation, ask vendors about this.
Implement a product from your ERP vendor’s partner: Not too bad Reliable ERP providers and implementation consultants offer their customers bolt-ons developed by partners to help their customers get more out of their ERP systems. This approach can be very successful for all parties when there is a harmonic convergence of platform, interface and integration. Third-party bolt-ons can have connectivity complications, unfriendly user interfaces, and may even have conflicts with other benefits of the core ERP. In cases where bolt-ons are built on a different technology platform than the ERP software, it makes interfaces even more difficult to design, develop, test, and support. When an important interface fails, it can affect the business and users in a significant way. Always ask to speak with reference customers during evaluation.
Unsupported bolt on from a non-partner: Could get ugly Think twice, and then one more time before implementing or integrating any unsupported solution!
Can you talk about ERP without using acronyms? Of course not – but it’s not a trick question. As one of our most common and cherished acronyms, “ERP” itself could almost have invented the TLA (the three letter acronym for three letter acronym).
Of course, it’s not that simple – ERP acronyms aren’t always three letters; and sometimes, the same letters may have different meanings to people from different industries. How confusing is that if you’re new to ERP or manufacturing?
The thing is, the humble TLA -- and other ERP acronyms -- represent a common language. Used appropriately, these expressions allow us to communicate ERP functions and benefits quickly and effectively.
Test your ability to “speak ERP” -- how many of the terms on the list below can you translate?
How many did you know immediately, without thinking? 14 or more? WOW! You must be an APICS founding member! 12 or more? Very good, you have definitely been around the block in the ERP world and know your stuff. 8 or less? You’ll need our handy Strategic ERP Acronym Translator below:
API: Application Programming Interface -- A protocol intended to be used as an interface by software components to communicate with each other.
ATP: Available To Promise -- The uncommitted portion of inventory or planned production available to be promised to new orders. ATP calculations can be used to verify whether an order can be filled within a specific time frame given other demands and currently scheduled supply orders. For example, during order entry, this lets you determine whether inventory will be available to meet a customer’s needs before you commit to a promise date.
BI: Business Intelligence – Software applications and technologies used to analyze an organization’s raw data and transform it into meaningful and useful information for business purposes. BI as a discipline is made up of several related activities, including data mining, online analytical processing, querying and reporting. Companies use BI to improve decision making, cut costs and identify new business opportunities.
CIM: Computer-integrated manufacturing -- The manufacturing approach of using computers to control the entire production process.
CRM: Customer Relationship Management: -- A widely implemented strategy for cultivating and managing your interactions with customers and leads. Provides a fully functional sales and marketing automation toolset designed to improve sales and marketing productivity, including communications and scheduling tools, pipeline and forecast management and customer service.
CRP: Capacity Requirement Planning -- Ensures that the resources, both equipment and personnel, are available to execute the plan. Together, an achievable high level production plan is achieved maximizing efficiency, and driving scheduling, procurement and execution.
EAM: Enterprise Asset Management -- An integrated plant operation solution that enables companies to operate plants more smoothly by keeping equipment running at the lowest cost. EAM manages planned and unplanned equipment maintenance, including calibrations, manages procurement of MRO inventory and manages capital asset project costs.
EDI: Electronic Data Interchange -- The direct transfer of data from one computer to another without the use of paper. EDI provides a streamlined method for managing communications between trading partners, including an end-to-end integration broker for B2B communications.
MRP: Material Requirements Planning (MRP) -- Addresses the need to ensure that materials are available to produce items at the correct time to meet customer delivery needs.
ROI: Return on Investment -- A performance measure used to evaluate the efficiency of an investment; calculated by dividing the benefit (return) of an investment by the cost of the investment; the result is expressed as a percentage or a ratio. Calculating the expenditure for an ERP project is fairly straightforward -- determining the gain is more difficult, because so many key benefits of a successful ERP project are intangible and unquantifiable. Tangible ERP ROI benefits include reduced costs and increased throughput; intangible benefits include things like regulatory compliance (invisible if you get it right, costly if you don’t), accuracy and process improvement.
SaaS: Software as a Service -- Delivering software over the Internet or “Cloud computing”; often associated with a “Pay as you go service”.
SCM: Supply Chain Management -- Integrates supply and demand management within and across companies. It includes important variables such as the planning and management of all activities involved in sourcing and procurement, conversion and all logistics management activities. SCM can also include coordination and collaboration with channel partners, which can be suppliers, intermediaries, third party service providers and customers.
SOP: Sales Order Processing – In ERP, SOP does not mean standard operating procedure. The process where customer orders are received, checked for creditworthiness then for product availability; and arranging for delivery to customers is done; finally billing and maintaining records of amounts due from customers is carried out.
S&OP: Sales and Operations Planning -- A decision-making process that realigns the tactical plans for all business functions in all geographies to support the company's strategies, business goals, and targets. A process led by senior management that evaluates and revises time-phased projections for demand, supply, product and portfolio changes, strategic projects, and the resulting financial plans.
TMS: Transportation Management System -- Provides a complete set of tools to optimize shipments by air, sea, parcel, truckload or less than truckload; provides international documentation and assists in compliance with denied party regulations.
UI: User interface -- The parts of a computer and its software that the user can see, hear, touch, or talk to; the set of all the things that allow user and computer to communicate with each other. Like any good communication channel, a user interface is a two-way street. The best user interfaces are the ones users don't have to pay much attention to. When an interface is easy to use, users can spend their time doing work instead of looking for the right button or key. It's almost transparent--users can see right through the interface to their own work.
What we learned at QAD Explore 2013: Ten building blocks for the Effective Enterprise
Today’s manufacturers must constantly adapt their businesses to address new market challenges. Effective enterprises leverage new technologies to drive productivity and performance for their organizations, their supply chains and their customers.
That’s why QAD Explore 2013 showcased the technology tools and information that enable manufacturing organizations to become more effective enterprises. QAD delivers tools and technologies that help companies streamline application maintenance and continuously improve key business processes.
QAD Explore is always exciting! Here are our ten key takeaways from this year’s conference:
QAD Enterprise Applications 2013 delivers significant enhancements – QAD continues to evolve QAD Enterprise Applications to help businesses operate more efficiently, adapt to change more easily and ensure business continuity. Robust architecture, fresh functionality and enhanced usability make it simple and easy for QAD customers to maintain, support and upgrade individual components while continuing to leverage the existing system.
Innovative framework simplifies application support – A new modular deployment framework provides the ability to enhance or upgrade individual components, elements and services within QAD Enterprise Applications. The simplicity of this framework eliminates disruption from replacements of the entire application. QAD users can access a variety of components online from the QAD Store and add them to their systems easily.
New capabilities support item attributes, traceability and quality control – With enhanced capabilities to address mandates for product traceability, the new quality control functionality supports detailed recording of item quality attributes and traceability of materials throughout the supply chain. These capabilities support both current and emerging regulatory requirements, like ePedigree and Unique Device Identification (UDI) in the Life Sciences markets. Serialization/Unique Device Identification (UDI) enhancements are in development.
New capabilities in QAD Enterprise Financials –QAD Enterprise Financials is designed to meet the needs of global public companies with support for regulatory and governmental compliance mandates such as Sarbanes–Oxley (SOX) and the adoption of International Financial Reporting Standards (IFRS). Complete retro-billing capability accommodates fluctuating commodity prices and allows for retrospective price adjustment and on-charging to the customer. This capability combined with the strong logistics accounting capabilities that manage shipping and freight costs before and after the event safeguard businesses against inaccurate freight and material cost variances.
Roles-based usability enhancements – QAD continues to enhance its leading-edge user interface (UI) technology. In the latest release, QAD delivers an advanced role-focused metaphor. This new metaphor collects the functionality a user requires to perform a specific role, via a simple configurable home page. From this home page users can execute their regular functions with a few clicks while maintaining constant visibility of key metrics and assigned tasks. QAD expects to build on this metaphor in the future to further enhance the user experience across the enterprise.
Enhanced deployment flexibility – Building on its goal to simplify upgrades for its customers, QAD’s application architecture enables enterprises to implement a full-strength ERP solution in the cloud, on premise or as a blended deployment containing a mix of on premise and cloud users. Customers enjoy the same complete functionality, business processes and user experience regardless of how their QAD Enterprise Applications solutions are deployed.
DynaSys acquisition delivers cutting edge Supply Chain Management (SCM) functionality – Ariel Weil, general manager of DynaSys, a division of QAD, highlighted advanced demand and supply chain planning solutions users will soon be able to take advantage of.
Cebos acquisition delivers new Quality Management Systems (QMS) functionality – Recent addition to the QAD team Bob Herdoiza, president of CEBOS, a division of QAD, introduced new capabilities to support Quality Management, Regulatory Compliance and Regulatory Control. Stay tuned for more details on how you will be able to leverage these capabilities.
Emerging trends – Tony Winter, chief technology officer at QAD, delivered insights into emerging trends like BYOD (Bring Your Own Device), and how QAD products will help you leverage them -- featuring the latest in mobile ERP, business process management (BPM), Big Data and other technologies.
QAD 2013 Global Partner Award Winner – Strategic Information Group was recognized as QAD’s North American Channel Partner of the Year at Explore. Look for more about QAD Enterprise Applications 2013 and evolving trends in enterprise computing in future issues of Strategic Unleashed. And save the date for QAD Explore 2014, May 5 - 8 in New Orleans!
Lifting the fog around cloud ERP: 11 critical considerations shed light on your decision
The ERP landscape continues to change radically, as more and more traditional, on-site ERP vendors offer their solutions delivered via a cloud-based, software-as-a-service (SaaS) model.
SaaS ERP can provide a relatively inexpensive way for companies to streamline business processes and maintain that competitive edge. On-site ERP deployments require large capital outlays and specialized IT resources. ERP SaaS solutions offer economic advantages like minimal capital expenditure, less financial risk, faster deployment and quicker time-to-market that allow for a quicker return on investment because it offers
Despite the hype, cloud ERP is not a panacea – and on-premise ERP is not going away. Still, cloud is now a key consideration in any ERP strategy. When your system is at the point in the ERP lifecycle where you’re considering an upgrade or migration, it’s a great time to rethink your ERP strategy and consider SaaS ERP.
These 11 tips will shed some light on the cloud ERP decision process:
Examine the differences between on-premise and off-premise ERP scenarios: On premise ERP; the software is licensed, installed at the customer’s site; plus maintenance. SaaS is most commonly delivered via the Internet in the cloud; companies pay monthly subscription fees.
Get to know the infrastructure tradeoffs: Is your existing network infrastructure solid enough to handle running ERP in the cloud? Is your staff knowledgeable about cloud networking requirements? There’s a good chance you’ll reduce network costs. Other network-related issues include compliance, security and ensuring adequate bandwidth and Internet access.
Understand the different types of clouds: The two major types of clouds are: private, for the exclusive use of an organization, typically managed by in-house IT; public, shared, hosted and managed by an external service provider.
Consider a hybrid approach: Another option is for companies to use a combination of on premise and SaaS ERP. A recent Forrester survey of 2,403 IT decision-makers showed that 10% of planned implementations will use ERP SaaS to complement existing on premise ERP.
Weigh cost considerations: The main reason ERP SaaS can be a very economical solution for small-and-medium-size businesses or start-up companies is relatively low initial TCO. Implementation, consulting and overall acquisition costs, along with the limited need for extensive IT infrastructure, make SaaS ERP an attractive option.
Appreciate industry-specific requirements: Industries where there are highly complex operations may not be a good fit for ERP SaaS due to the level of customization that may be required. Recently, ERP SaaS adoption has picked up considerably in life sciences and other sectors that require strong compliance capabilities.
Get the right level of control: You have to make strategic decisions about appropriate levels of control of your data, modifications, and configuration. The very nature of SaaS ERP requires you to relinquish control of software, maintenance and upgrades. But if you don’t like the service you receive from your SaaS provider, get rid of them and find another vendor.
Ensure accessibility and reliability: Even though SaaS provides tremendous flexibility in terms of enabling users to access anytime, anywhere, SaaS access relies on Internet access. SaaS solutions have become very reliable. Reliable vendors have extensive disaster recovery plans in place so that quick restoration of data can take place in case of an emergency.
Think about IT resource constraints: Even if you have the right skill-set to deploy ERP on-site, the number of resources required will be far greater than with a SaaS deployment. If you don’t have the in-house expertise required to undertake a potentially long and extensive on-site ERP deployment, SaaS ERP may be a better option for you.
Know your customization requirements: SaaS ERP is best suited to enterprises that don’t want or need a high degree of customization. In industries where processes are very complex, you need to take this into consideration.
Determine your need for speed: If quick deployment is high priority, then SaaS ERP could be a better option for you.