Microsoft Office is NOT your business system

This post is somewhat driven by a recent client whose business system consisted of:

  • An Access Database for Customer details
  • MYOB for Accounts
  • Excel for analysis and pricing
  • Word for invoices
  • A server for historical documents and
  • Crossed fingers, Blue Tak and SuperGlue holding it all together

The issues were many, and it was somewhat surprising that they had grown into a successful mid-sized business with this ‘infrastructure’.

The problems thrown up were:

  • Lack of business monitoring tools e.g. Dashboards, reports, alerts
  • Lots of manual processes
  • No single place to identify the ‘truth’
  • Lack of consistency
  • No true real-time view of the business, revenues or profits
  • Little was documented

There were benefits:

  • The business was very flexible, it could ‘whip-up’ a new process in a few minutes
  • Staff didn’t feel constrained by business processes
  • The managing director could get a feel for the business by walking around

So why did the MD start looking at ERP and CRM systems? Well he wanted to retire and sell the business – he could only do this with real data in real systems. The driver was not running his business, but getting the most value out of the sale of his business. His current systems would reflect badly in the due diligence process.

Does this sound familiar? Look at the Do You Need ERP Guidebook for more examples.




End of Financial Year Close Accounts are Ready – Right?

When you came in this morning and asked for the FY2011 final results your finance head pressed a button and the results popped out – right?

This means you can answer YES to the following:

  • All you have to do now is to get your accountant to audit and then sign-off the accounts?
  • Your sales targets go back to zero
  • New Sales targets are loaded in their Sales CRM systems
  • Your sales team’s compensation plans are automatically calculated
  • New Government legislation for HR systems now eg new parental leave rules
  • The company’s key metrics for this year’s strategic plan are loaded into the reporting dashboards

Answered NO to any questions?

One of the great benefit’s of ERP solutions are that the whole idea of the end of year ‘close’ can go away. The systems are right up to date, any day of the year – and today is not special!

Read more by downloading our Do you need ERP Guidebook and our rules on spreadsheets.

When and Why You don’t need an ERP

An Enterprise Resource Planning System(ERP) aims to deliver in a single system the capability to manage and automate most if not all of a companies business processes. But let’s be frank – sometimes you just don’t need an ERP – it can be an overkill.

Firstly, let’s look at why ERP was initially built and why they are very useful. ERP systems are made up of a range of functions such as finance and accounting, manufacturing, supply chain, warehouse and human resources. In many businesses these were separate systems and moving information between them was difficult(if not impossible). Interestingly, some industries just didn’t buy in to ERP eg Banking was very early into CRM but quite late to ERP, only now starting to implement.

ERP systems were designed to:

Deliver a single system with all of these functions, by creating a Central Database, where information is held, integrated and shared easily.

Herein lies the great strengths and weaknesses of ERP systems:

  • Sometimes a business does not need a single system – it sometimes needs a number of systems
  • The functions of an ERP are usually described as “best in class” or bench-marked – this can mean that ‘everyone’ does things the same way, so there is no differentiation or competitive advantage
  • A central database is a great idea, until you want to add a new field ( and then see the potential impacts and costs to that small change)
  • Often the different functions only use a very specific parts of the database, and share little data.
  • Integration was strong within the ERP system but often weak when working with other systems
  • Sharing of information was rarely as good as it was marketed.
  • These systems are implemented by consultants – but many projects were just too big for mortals to manage

In recent times there have been a range of technology changes that have resulted in a different world:

  • New web-based  technologies have made integration much easier
  • Businesses have to be much more fluid than they were – being more nimble
  • Custom development is back in vogue – building the software to your business exact needs 
  • A Best of Breed strategy is also back in vogue – choosing the best solution for an area and then integrating with another system
  • End-users have become used to using Social media tools like facebook and linkedin – so want their business tools to work in the same way

ERP vendors have realised many of these are happening and now sell their solutions separately or integrate better using Business Intelligence tools and Integration platforms.

So where are the break points, when does it make sense to be running a single system and when many. I think it somewhat depends upon the size of the business but the following could be separated:

  • Accounting – can be stand-alone
  • Manufacturing, Warehousing, Logistics, Purchasing
  • Supply-Chain( only if you are big)
  • HR ( although payroll often outsourced)
  • CRM (keep Sales, Marketing and Service together if you can)
  • BI/Analytics

For more information, read our Do you need ERP Guidebook and ERP Checklist for features and functions whichever route you choose.

ERP as a Finance & Accounting Solution

Companies use  ERP solutions to manage critical business processes, to respond quickly to change, and make the most of  assets and resources. These ERP solutions were originally aimed at very large companies but over the years have become simple to use and deploy—and easy to customise and adapt as business needs change. Just like cars the features aimed at the top of the market gradually perculate down.

Typically, ERP systems replace accounting packages that have been in place within a business for many years. They deliver the accounting functions needed AND they reach into other parts of the business and deliver more information to run the company.

ERP systems deliver benefits in a number of Finance/Accounting areas:

  • Financial Management
  • Planning & Budgeting

These are also typically found in an Accounting package – download this Guidebook if you want to decide when to move from an Accounting Package to an ERP Package.

Financial management

We have broken down the finance functions into 25 areas – download in the ERP-Checklist Guidebook to find the right system for your business.

ERP systems deliver greater visibility into finances and give people across your organisation the tools they need to improve financial management, financial forecasting, and accounting throughout your organisation.

Financial processes can be streamlined, analysis simplified  by automatically presenting formerly disparate sources of information in a single view, that can be tailored to roles eg distribution manager, CEO, CFO, Sales Director.

Share reports in a business portal on the company intranet, or publish data on your extranet with enhanced security to promote privacy for auditors.

Monitor business performance and spot trends with key performance indicators (KPIs), export information into a spreadsheet for further analysis, and access flexible reporting capabilities to present business information in the best format for your audience.

Generate real-time reports, close books quickly, and share data with multiple ways to report, analyse, and share information.

Expand into other geographies, markets, and industries, and support multiple currencies and languages.

Planning and Budgeting

Monitor, measure, and manage organisational performance with planning and budgeting applications that work with your enterprise resource planning (ERP) solution to measure business results and provide flexible reporting capabilities. Depending on your business needs, you can:

  • Deliver basic planning and budgeting with simplified, template-based planning and budgeting functionality
  • Take advantage of powerful analysis and reporting capabilities—including creating and publishing financial statements such as Profit and Loss (P&L) statements, balance sheets, and cash flow reports
  • Create boardroom-quality reports without IT help, enhance security for report distribution, and help support regulatory compliance
  • Build custom reports based on GL data, and slice data into rows, columns, or hierarchies
  • Manage complex consolidations and multiple currencies

Find the right ERP Vendor for you small, medium or enterprise business today!