Three Ways to Tell if Your ERP Implementation Has Been Successful
Three Ways to Tell if Your ERP Implementation Has Been a Success
When you set out at the beginning of your ERP implementation project, you will have set out your primary goals and objectives. Now that your ERP system has been up and running for a while, it is time to check in on performance.
What are the best ways to see whether your new ERP is making the difference you thought it would? Here are a couple of good places to start.
1. A Positive ROI
Any major business investment should be able to provide a return, so this should be your main success metric for an ERP system implementation.
Some investments may take longer to bear fruit than others and the larger the project, the more time it can take to prove an ROI. That doesn’t mean you can’t detect trends in the meantime. The payback period for an ERP system ranges from 1.7 to 3.2 years, with 2.7 years being the average. That might seem like a long time to wait but the payback itself should be significant enough to make the daunting outlay much easier to digest.
Planning when you expect to see a return (and how to calculate it) should have been a major part of your implementation planning process. It is unlikely you would have had sign-off to invest without it. (If you are reading this article prior to selecting a vendor and setting out your requirements, take a look at this ERP Selection Survival Guide for an overview of the entire process).
For help with forecasting, analysis and calculation, try this easy-to-follow ERP ROI template and tips from industry experts.
2. A Visible Increase in Productivity
Seeing improvements in productivity will be an earlier indicator of success than the ROI. Look back at the objectives you set out around productivity and reducing human error. Are you hitting those goals? Are you seeing positive trends? With all the automated processing that ERP brings, you should start to see the benefits once your users have been trained and are making use of the features you chose.
Here are some of the ways that a successful ERP implementation improves productivity:
- Improved communications
- Reduced manual work
- Slicker business process workflows
- Better forecasting and data-driven decision making
If your users have been well trained and supported, then you should be able to see where your productivity improvements are paying off.
3. Increased Client Satisfaction
Are you getting orders to your customers quicker? Are your clients enjoying better communication with you? Is there a reduction in dispatch issues and other customer pain-points? All of these things are measurable and an easy way to find out whether your ERP implementation is having a positive effect.
You can track and optimize customer service metrics as well as organise communication with both the demand and supply side of your chain. Look back at the customer service KPIs you set out to hit when you went through your ERP selection process and look for signs of improvement. Again, this can be an early indicator to ERP success than the more overt ROI goal.
Helen Peatfield is a writer, editor, and regular contributor to ERP Focus. She has a wealth of experience in ad tech, supply chain management and SaaS. When she is not typing away at her desk, she can be found scuba diving or wakeboarding in the sunny Gulf of Thailand.
The Worst Supply Chain Mistakes And How To Avoid Them
The Worst Supply Chain Mistakes And How To Avoid Them
Supply Chains are improving continuously and rapidly. This means that managers are seeing an increase in challenges that arise with these changes. As these continue, the chances of something going wrong is more than likely. Without minimizing these problems, they are only going to snowball into something worse. Here are the worst supply chain mistakes, and how to avoid them to better streamline your supply chain processes.
Still Relying On Spreadsheets
Many companies start out using spreadsheets when they first start to track their inventory. As your company evolves, however, so does your data. By continuing to track inventory on a spreadsheet, you’re only digging yourself in a deeper hole. As a business grows, so do the problems that start to arise without a proper inventory management software.
It’s time to upgrade when:
- Inventory isn’t being updated automatically
- It’s not accessible on the go
- You are losing track of inventory
- Too much time tracking/ dealing with errors and reports
- You are combining various software together
Prevent these errors by investing in a full enterprise resource planning (ERP) software. The importance of inventory tracking is evident, and essential to productivity. With a good inventory management system you can easily update without having to modify multiple spreadsheets. Not to mention, you will have the ability to project your future inventory needs.
Poor Customer Service
What happens when customers aren’t happy with your service, lack of availability of products, and denied orders? You lose business. The cause always stems down to the unavailability of products.
With problems like inaccurate demand forecasts, late deliveries from suppliers, data integrity issues, unreliable suppliers, lack of or unreliable formal planning system, unreliable production schedules, poor on time manufacturing schedule performance and organizational issues such lack of teamwork, lack of communication and lack of accountability, there’s always something that can go wrong.
Make sure to accurately look at data and predict your inventory. Good customer service depends on the visibility of information. It is necessary to provide and receive the most amount of data as possible to make the necessary changes in the supply chain before it becomes a problem. It takes a good inventory management software integrated with an ERP to fully manage your orders.
Inaccurate Planning
Market intelligence is the secret formula to planning a business’s future. Purchasing and selling cannot decided upon without much planning. With the mass amounts of products being sold/bought and money being spent, there is no room to leave out planning. To properly plan, however, a company needs to have accurate data. It needs to know what it already has, how it’s going to sell, buy, and stock on a continuous basis. Sadly, many companies even today do not formally forecast. Many companies employ highly intelligent, highly paid executives to spend their time gathering sales data for them to massage it in an Excel Spreadsheet to develop a forecast – a process that at times takes a few days. More often than not, they spend 95% of this time gathering data and 5% of the time in evaluating results. Get a modern software that will give you the ability to plan properly by tracking ins and outs like it should. Something that will flag you down when inventory is not where it should be.
Keep your supply chain running at optimum efficiency. It can be as simple as applying a few necessary steps to make sure it runs smoothly. Start by upgrading from spreadsheets to something that can actually help and manage your supply chain well. Optimize your customer service and make sure you always have what your customers want in stock. Lastly, use the market intelligence from your Enterprise Resource Planning (ERP) software to be aware and plan for optimal performance.
The Hidden Costs of Inadequate Business Management Tools
The Hidden Costs of Inadequate Business Management Tools
When a business is first formed, the management needs to put in place some method of managing their business operations so they can keep track of sales, orders, inventory, invoices, purchase orders, and all the other activities needed to run the business. At first, the business will probably be quite small and there probably won’t be a lot of capital available to purchase and install a complex ERP (Enterprise Resource Planning) software. Many business startups will often use very simple software tools such as Excel or Quickbooks to keep track of these activities.
This may be adequate for the initial startup of the business, but difficulties start to occur when businesses grow. The volume and complexity increases. The management of the business may believe that the tools they initially installed are still “good enough,” but what they may not realize is that their company has outgrown these initial tools and this inadequacy is creating hidden costs which is hampering the growth of the business.
Examples of hidden costs of inadequate business management tools:
- Not enough inventory available, causing lost sales
- Too much or wrong types of inventory that can’t be sold, leading to waste and scrap costs
- Poor customer service, creating dissatisfied customers
- Pricing which is either too high, or too low, causing either lost sales, or lost profits
- Slow collection on invoices causing potential cash flow problems
Many of these problems can sneak up on you and you may not realize the extent that they are occurring. So it is wise to periodically step back from the day-to-day activities for a brief period and really take a look at these problem areas and see if bringing in more sophisticated software tools is appropriate.
In the past, installing a sophisticated ERP system would require you to install hardware on your site to run on-premise software. And this would entail creating a whole new infrastructure to maintain this software and perform things like data backups, software updates, bug fixes, etc. In addition, to the costs of the software itself, there will be additional capital and operating costs for the computer hardware itself and the necessary power, cooling, and floor space.
Fortunately, with today’s modern cloud-based software tools it is no longer necessary to pay an arm and a leg in order to obtain a good performing ERP tool. My Office Apps offers Kechie ERP, which is a complete, easy-to-use ERP software that runs on the cloud and gets implemented quickly. Kechie does not require any hardware or software installations, or the attendant infrastructure to support it. Since it runs on the cloud, we take care of the servers, backups, software updates, data security, etc. Better yet, using Kechie does not require any up-front capital costs since payment for this Software as a Service (SaaS) only entails a very reasonable, per-user monthly access fee.
So, although you may initially feel that your customer business management software is good enough, we urge you to take a closer look to truly understand the costs of some of the operational problems mentioned above. We think that these hidden costs may actually be larger than you think, while the costs of implementing a cloud-based ERP system like Kechie may be smaller than you think. So you may be able to improve your business’s sales and profits by upgrading your tools.
My Office Apps has business specialists available who can help you evaluate your business and uncover improvement opportunities. Many folks on our team have been using ERP systems for many years under all sorts of different situations. We have been in your shoes and we can leverage our experience to show how much difference a reliable ERP system can make in your operations.
The ROI of Cloud ERP Implementation
The ROI of Cloud ERP Implementation
ROI is the key determiner in deciding which investments give the greatest return. In other words, ROI is a comparison of the expected benefit of a particular investment measured in monetary units, compared to the cost of that investment in the same monetary units.
The lack of efficiency and the great limitations of spreadsheets, basic accounting software, and even paper make running a business at optimum performance a little difficult. Without a proper ERP solution, businesses are struggling to get a greater ROI.
The ROI Benefits of the Various Aspects of ERP Are Greater Than You Might Think
The reduction of costs for IT is massive. There’s an anonymous technology company using a cloud-based ERP software that saved more than $100,000 in hardware and software purchases and avoided hiring at least three full time employees for its IT department.
Cloud ERP allowed companies to replace outdated accounting packages like QuickBooks, which, while inexpensive to purchase, were costly in maintenance, integration, and manual data entry.
There’s A More-Than Noticeable Increase in Productivity.
Sales and marketing teams are better able to serve customers. If you have a sales call and want to update the customer database, you don’t have to write a note and remember to do it when you get back to the office; that is very inefficient. You actually can just make the direct changes right then and there, adding notes within the ERP for everyone to see!
Moving from paper, spreadsheets, and accounting packages to cloud ERP solutions helps companies speed up collections, reduce the quote to cash time, and increase the accuracy of their billing. Monthly or yearly financial close has been simplified as well, due to financial consolidation and the ability to more easily access and manage financial data.
Decreasing inventory levels through better inventory planning reduces costs. Inventory management systems improve the tracking for movements. This is not only an important factor, invoice accuracy can reduce collection cycles, which in turn improves cash flow.
The Statistics of ROI for Cloud-Based ERP Solutions
Even though cloud ERP only represents 2 to7 percent of the total ERP market at present, the revenues it generates are expected to double by 2015 compared to 2010. Nucleus calculated the ROI achieved by using cloud ERP, and noticed most companies reported a higher than 150% ROI. One client of Netsuite’s said, “There is information about the customer and what they ordered. They can see history without tracking people down and see a complete picture of sales, ordering, and fulfillment. That has made us 20 to 30 percent more profitable.” Can you imagine how much this benefits customer service? The answer, according to this company, is 20 to 30 percent more profit.
Conclusion
The ROI for a cloud-based ERP system heavily outweighs what a cluster of non-integrated, lacking software offers. Not to mention, the returns are far better on a cloud-base than an on-premise ERP software. With the right ERP system, businesses are able to properly track and measure all of the various benefits of a proper ERP system to see their returns grow continually.
Will Inventory Management Software Really Help My Company?
What is inventory management software?
Inventory management software consists of business applications that track, manage and organize product sales, material purchases and other production processes. The software is used to track products and parts as they are transported from a vendor to a warehouse, between warehouses, and finally to a retail location or directly to a customer.
Why your business is being held back, drastically.
Growing companies can have a hard time keeping track of their inventory data accurately. When things are moving in and out really fast, simple lists and excel spreadsheets just don’t keep up. When someone has to manually enter everything into Excel, it leaves a lot of room for human errors. It also lacks real-time data so what you see on your Excel sheet may not actually match what you actually have in person. This is especially true when you have multiple people touching your inventory, but can only have one person update the sheet at a time. Another common problem is that using Excel to track large quantities is not only difficult, but it also increases the likelihood of the program crashing as your data grows exponentially larger.
Without accurate data, your views into your business are skewed—and you could end up making costly business decisions.
The statistics show that around 45% of American consumers shop throughout multiple channels within the market. As consumer data becomes more challenging and harder to test and analyze, it becomes harder to track manually. With the right inventory management software, however, it becomes much easier to sync the data between your sales and fulfillment.
An inventory management software must be adaptable.
Having an inventory management system that updates in real-time and has access to historical data can provide you with more useful information to make more accurate predictions about how much of a particular item you should stock. An accurate inventory management system will prevent having a bulk of items collecting dust on your shelves, having products that are in high demand on back order, and overall keeping your customers happy. This way you can optimize your inventory levels and replenish items as quickly as possible, so you have as little inventory as possible and your goods are constantly replenishing. Only the best inventory management software will be able to Integrate with other platforms to make management easy to use (Shopify and Salesforce).
So in short, inventory management software will not only optimize your company, it will help and grow with it, exponentially. Get a Free Demo now.
5 Tips That Wholesalers Can Use To Better Manage Their Warehouses
5 Tips That Wholesalers Can Use To Better Manage Their Warehouses
1. Offer special pricing for your overstocked inventory
Building savings campaigns for your overstocked inventory through daily, weekly, or monthly deals, lets you one-up your competition, and move your merchandise quickly and easily. Retailers will watch for these specials and will appreciate the added savings they receive when they deal with your company which means – yes, you guessed it – more orders!
2. Make ordering, delivery, and billing as seamless as possible
Automate your order management and product distribution processes as much as you can. This means less waiting for busy retailers who want a simple, streamlined process, putting your company near the top of their lists of wholesaling firms to bring their business to. It’s important to utilize an inventory management software that can streamline the operations for you!
3. Give your sales reps what they need to succeed
Do your sales reps have all the information they need going into sales appointments? Forward-thinking wholesalers, manufacturers, and distributors are understanding that in order to make sales in this day and age, sales reps need to add value to their sales conversations, not just go through the motions of writing down a reorder. Using a capable CRM is the next best step to creating more sales, and maximizing the sales process.
4. Differentiate on customer service, not price
Wholesalers who can differentiate their brands by providing great customer service are seeing returns. Think about how you can create a modern, convenient experience for your customers. How can you fulfill orders more quickly and replace transactional activity with strategic value? The short answer, is increased customer service. By tracking what your clients are purchasing and how often they do it through a sales order management software, you can get an insight into making sure you are their go-to distributor.
5. Get your inventory under control
You can’t run a profitable wholesale distribution business if you don’t have a good handle on inventory management.
Tracking incoming/outgoing inventory, doing regular physical inventory counts, and implementing a great inventory management software, are all key in keeping your inventory in good standing.
Wholesalers can optimize their business by implementing these strategies within their warehouses today.
The Importance of Choosing The Right ERP Solution The First Time
Is It Really Important to Choose the Right ERP Solution the First Time?
These statistics seem to say it is.
- 80% of customers are unhappy with their current ERP.
- 60% of ERP projects fail.
- 90% fail to deliver any measurable ROI.
- 95% of failure companies dedicate less than 10% of total budget to education/training/change
- 41% of enterprises fail to realize less than 50% of all benefits.
What can go wrong if you don’t?
The System implementation can take longer than expected. The Lack of training causes lack of confidence and efficiency. The system isn’t as easy to use as predicted, causing a loss in time and value. The system isn’t cloud-based, meaning sales people can’t work on-the-go. Companies fail to realize less than 50% of all benefits because of a lack of training and efficiency that over-complicated and expensive ERP systems.
Great ERP systems need to be able to prevent and avoid these problems at all costs.
The solution is to make sure the ERP you choose has: a good price, ease of use/customization, scalability, and is cloud-based/accessible everywhere.
Don’t miss out by getting a complicated ERP system that you will hate; get a sophisticated ERP system that’s easy to use, and the entire company will love.
Kechie ERP – The next generation of Cloud-based ERP solutions.
Kechie ERP is ready to go and easy to use. Get training along the way with built-in, specific training videos. It is the most customizable ERP system that adapts around your business, not the other way around. Not to mention, Kechie ERP is the most affordable ERP compared to the other top-named brands. With a 100% user satisfaction rate, Kechie continues to provide the very best for all businesses looking to increase their ROI’s, grow, and expand.
Try it for free now at no risk, and see how easy and essential it is to any growing company.
What have you got to gain? A complete revision on how efficiently and easily your teams can manage your company collaboratively without any of the downfalls.