Most companies know the impact of a modern ERP system. It can help you become more efficient. It can help you leverage data and knowledge that may otherwise be buried in one area of your company, so that it can be used by all parts of the company. It can tie together disparate systems. The list goes on.
What does not always come to mind is the unspoken benefits that come with an ERP system. The high-end, high quality consulting that goes along with an ERP Implementation.
Now that is not a given. All consulting companies are not the same. But let’s accept that premise for a minute – that your consulting partner, your System Integrator (SI), has a good understanding of business processes for your industry. They know how to leverage software to solve your business problems. So, in addition to the software, which has tremendous leverage, the SI can have tremendous leverage. (Stick with us for another minute, this is not a shameless plug!)
However, the high-end consulting that often/can/sometimes goes with a standard ERP Implementation comes with a price tag. Sure, there is an ROI story that puts the price tag in context. But for many companies, even with a proven ROI, the cost is a barrier of entry. That is no longer the case.
There is another option.
Mid-market companies – like Telco Coops and Boutique Retailers – are no longer excluded from a high quality ERP system and the high quality consulting that can go along with it because of something called a Template Approach. In short, it removes the high cost of entry that previously stood in the way of mid market companies by using an uber efficient process that takes a fraction of the time and cost. You can read more about it here.
If you’re familiar with the 80/20 Principle, then you are already familiar with a Template Approach. You put a vast majority of your time and effort into the areas where you get the most leverage. As we mentioned above, not every firm can do that. (OK, that was a slight shameless plug.) Your SI must understand business process.
But if they do, you now have access to the high quality consulting that previously was only available to Fortune 500 companies. Because of something called a Template Approach.
First starters, how is this possible? The short answer is a Template Approach. It is an uber-efficient approach to ERP implementations that brings the benefits and efficiencies of a modern ERP system without the high barrier of entry – the large investment.
However, a Template Approach is NOT for everyone. Here is a breakdown of the companies who ARE an ideal candidate and which ones are NOT – and why.
A Template Approach IS for you if:
- Small to Mid-Tier Company
- Revenue $100 million – $2 Billion
- Larger companies for certain processes (accounts payable & core financials)
- Have Your Own Processes (but you don’t need to)
- Boutique Retailers
- Telco Coops (Utility Industry Coops)
A Template Approach is NOT for you if:
- Cutting edge companies with cutting edge processes
- Highly technical businesses with set, custom processes
- Highly complex conglomerates (Fortune 50)
How is this possible?
How is it that companies – who have the biggest need of becoming more competitive and sharing data throughout their organizations – can now run their businesses with the efficiency of a Fortune 500 company? We leverage the 80/20 Principle. Here’s what we mean by that.
Instead of mapping ALL of your processes, we spend time hunting down the areas where you have your own processes, but you don’t need to. Instead of reinventing the wheel, we use a tested-in-the-field process that gets results. We spend 80% of our time on the areas that will get you the most leverage.
There is a catch, however. A Template Approach only works when you know the processes for your industry. Not every Software Integrator (SI) does; ITK Solutions Group does. When your SI doesn’t know the industry best practices for your industry, they can’t distinguish between the unique processes within your business and where to follow best practices. For some software consulting companies or SI’s, who know software but not business processes, this becomes a wild goose chase with suboptimal results.
You can find out more about how to become a more competitive company that runs like a Fortune 500 company with our free white paper, A Template Approach to ERP Implementations. Or, if you have questions and are interested in finding out how to transform your business, contact Chris Fibbe at email@example.com.
Do any of these seven reasons sound familiar?
Reason #1: Manual Spreadsheets
These are one of the more obvious and common speed bumps in the close process. Using spreadsheets is one of leading indicators of companies who are good candidates for improvement in the close process. Spreadsheets have evolved over the years but they have their limitations. Like all tools, it’s important to use the right tool for the job. What they aren’t particularly well suited for is collecting data from disparate ERP systems and handing off that data. Using manual spreadsheets often add an average of 3-4 days to your close cycle. Plus, if you move off of spreadsheets you can help avoid the next three reasons: people, errors and duct tape.
Reason #2: People
In a process that is largely manual speed is dictated by the pace of the slowest moving element. That means that you can’t close the books until you get whatever you need from other team members (who are often in another office). Your speed, therefore, will be dictated by the pace of the slowest moving individual. “Did Victor get pulled into crunching the numbers for that merger possibility? Great, that means we’ll be closing the books two days later this month. No, there is no “i” in close.
Reason #3: Errors
This problem is an offshoot of people and manual spreadsheets. People are human. Even though finance people are often superhuman, they are fallible. That means errors happen. And when they’re caught, you have to go back and figure out what happened exactly. More importantly, you need to recrunch the numbers. It’s been said that there’s never enough time to do the job. But there’s always time to do it over. Imagine never having to do the job over because of a mistake. Yes, it’s possible. It looks something like this.
Reason #4: Duct Tape
Manual Spreadsheets. An ERP system in the US. Another ERP system in France. Perhaps another system in Sweden. You will have to essentially use Duct Tape to bring all these systems together. To bring all these numbers together. Closing the books isn’t going to be easy. Or is it? Imagine if there was a system that could bring disparate ERP systems together. That’s what Unit4’s Cash and Consolidations makes possible. It brings all your data together. And, unlike duct tape, it does it automatically. Click below to find out how it works.
Reason #5: Vacations
Vacations are important. There is more and more research addressing not just the importance but NEED for vacations. If you want to be productive over the long term, you MUST take time off. But what happens when Sven takes two weeks off and he’s responsible for consolidations for his region but everyone in the home office in the US is waiting for him. When Sven doesn’t provide his numbers then the global books can’t be closed. The solution is not to cancel vacations. And it’s not to ask everyone to work harder when Sven’s on vacation. It’s to work smarter, not harder. Like using software to bring all your disparate data together. Simply. Automatically.
You may think you don’t have enough time to attend our 30 minute webinar, Shorten the Close Cycle, because you’re busy closing the books. But that is the very reason to attend.
Reason #6: Fear
For some people involved in the closing process there are concerns that they won’t have anything to do. Often this is a time of constant, frenetic movement. Will someone think we’re not needed. Again, I think you’d be hard pressed to find a controller who couldn’t be leverage in a more strategic way beyond the transactional nature of their old job.
Reason #7: No Close Process
Many companies close the books, they just don’t have a repeatable process to do it. A lack of an understanding of the critical path of the close and efforts to reduce the items in the critical path is often what gets in the way of an efficient close process. A company with multiple currencies, multiple companies can benefit from a process grounded in project management best practices. For the uninitiated that’s a systematic and strategic way to approach the close. Sometimes the close process that really isn’t a process is a product of “that’s just the way we do it here” thinking. If, instead, you think of closing the books as any other project, you can remove reason #7 for why you may be taking so long to close.
These aren’t just seven reasons it takes so long to close the books. They’re seven reason you should attend our 30 minute webinar, shorten the close process. If you’re using manual spreadsheets, deal with multiple currencies and have disparate ERP systems, this webinar is for you.
When you’re closing the books, data that is two weeks old is much more valuable than data that is four weeks old. This is an issue for many companies. In particular, companies with multiple currencies, have disparate ERP and other finance systems and are heavy users of manual spreadsheets. Here are the implications of taking a long time to close.
Data is best served fresh. Like a new car or a loaf of bread, it starts losing its value quickly. There’s a simple way to find out if your data is fresh. Observe if people care about your data. People stop caring about it when it gets old. They will not put stock in data that is three weeks old. By then, new data is starting to become available.
Side Room Accounting
“Side room accounting” is an unintended consequence of a long close process. Groups will track their own invoices and financials because they need this information. It is a short term solution when relevant data is not available. The problem is that while they’re engaged in side room accounting, they’re not engaged in consolidations. Which leads to even more inefficiency and a longer close process.
Accountant versus Advisor
Accounting provides data. An advisor provides insights. There are two key factors that help you become an advisor with a seat at the table: fresh data and time. Having fresh data that is accurate and relevant is certainly a key factor. But where it gets its true power is with time. An efficient close process affords group finance roles the time to translate data into business insights. Fresh data has value, but having the time to make sense of the data is the true value. This allows you to provide valuable insights to senior leadership in a form they can understand and use.
Reducing the time it takes to close is a good thing, right? It is but some people who are engaged in consolidations often worry that they won’t have anything else to do if they speed up the close. Being busy closing is a big part of what they do. For many organizations that provides a disincentive to closing more quickly. Creating an efficient close process helps teams regain control of what can be a messy process. That efficiency doesn’t make the team less valuable, it makes them more of an asset by producing more reliable data. More importantly, it allows for more time to provide insights, instead of just crunching data.
Now we know why 2 > 4, but how do we get to a two week close?
We’ve partnered with Unit4 to help show you how to close faster, so you can do more of the things you’d rather be doing. Click HERE to attend our free 30 minute webinar, How to Shorten the Close Cycle.
Consolidations are especially challenging for companies in these scenarios:
- Enter data manually via spreadsheets
- Disparate ERP & Financial Systems
- Multiple Currencies
- Multiple Countries
1) Provide Business Insights to Management (or the Board)
Obviously data is valuable for disclosure, regulatory and budgeting reasons. But imagine if you had time once you closed the books to analyze data. You could then take your insights and provide them to management or board to impact the next period. If the books are not closed until the next period is largely completed, any issues or negative trends will continue over TWO period. A fast close enables the learnings from the recently closed period to be applied to the next period to improve results.
2) Cash Planning
Planning takes, well, time. The kind of time you get when you don’t close halfway, or most of the way, into the month.
3) Revenue Forecasting
Where is revenue coming from and not coming from? Where could it come from? Wouldn’t it be nice to have time to be able to not just ask these questions, but to answer them?
4) Risk Analysis
Where are the vulnerabilities in your business? Are you taking too many risks? Or are you not taking enough risks?
5) Budget Forecasting
How many other items do you have to get to before you get to budget forecasting. And, once it comes up on the list, how much time and energy will you have to dedicate to it?
6) Scenario Planning
Strategic Financial Planning – otherwise known as What if planning. What if we acquired X Company? Or, What if we merged with Y company? What if you had more time to ask ‘what if’?
7) Long Range Planning
Imagine if you had time to examine and improve upon your core business model. Take on new initiatives for the finance department.
8) Evolve Your Role
What if your role changed from disclosure and regulatory – to risk analysis, revenue analytics and long term strategic planning? Whether you’re a CFO or Controller, what if you could be a rain maker, instead of a bookkeeper?
9) Take a Personal Day
Maybe you would want to spend time on numbers one through eight. But what if you could attend your child’s soccer game or school play? Or any number of events you might ordinarily miss. So when you come back to work you come back refreshed.
OK, but how do you Close 9 Days Earlier?
We’ve partnered with Unit4 to help show you how to close faster, so you can do more of the things you’d rather be doing. Click HERE to attend our free 30 minute webinar, How to Close the Books Faster.
So you’ve finally decided it was time to kick your antiquated systems to the curb and begin the exciting journey of selecting a new ERP solution? That’s good news! We here at ITK know how daunting the ERP software selection process can be when you don’t have the experience that’s required to effectively sift through all the ERP products and partners available to you. Especially if you don’t know which questions to ask, and what factors need to be considered. Thankfully, there are several experienced companies that provide ERP related software selection services, and we happen to be one of them. But, for those brave companies that choose to navigate the ERP software selection process alone, we’ve compiled a list of 17 questions for your company to ask before you select your next ERP software solution and partner.
1. What’s the average 5-7 year TCO & ROI for the ERP solution(s) being considered?
Initial implementation costs (license fees, consulting fees, hardware costs, etc.…) should not be the only costs that your company takes into consideration when selecting a new ERP solution. Just because an ERP solution may cost less to implement, up-front, does not mean that it is going to be cheaper in the long-run. Typically, companies will look to update / implement an ERP solution every 5-7 years, so it’s extremely important that your company try to find some facts and figures that show you the average 5-7 year Total Cost of Ownership (TCO) and Return on Investment (ROI) associated with each ERP solution being considered. Finding an unbiased resource that provides 5-7 year average TCO and ROI calculations for each given ERP product can be quite difficult. However, it’s not impossible. Using figures from a decade-old average TCO and ROI research study may not give your company the most accurate figures to work with, but it should at least give your company a solid baseline TCO / ROI calculation for each ERP product being considered.
2. Is the ERP solution provider continuing to invest in R&D?
Generally speaking, the product life-cycle for most ERP solutions is anywhere between 5-7 years. Which is why it’s so important that you look for an ERP solution provider that’s continually investing in the research and development of their product. Most ERP solution providers will offer their current / potential customers a product roadmap. Typically, these ERP product roadmaps will give your company a better idea of the level of commitment that each ERP solution provider dedicates to their product. Finding an ERP solution provider that dedicates a reasonable amount of funding into R&D will help reduce the chances of your selected ERP solution becoming discontinued or unsupported. Obviously, these product roadmaps cannot predict the future, but they can still provide your company with the insight necessary to select an ERP solution that will be the best long-term investment. Finally, you will want to make sure that you’re investing in an ERP product that’s going to add new functionality to keep pace with business evolution. A healthy investment on the part of the software vendor suggests that you will receive new and better functionality for free as part of your annual maintenance.
3. What are the average annual maintenance and support costs?
It’s a bit harder to find accurate and up-to-date resources regarding average maintenance and support costs, but the information is out there. Even older research studies that address this question can provide your company with valuable insight into the average maintenance and support costs associated with each ERP solution being considered. Getting more granular, your company should seek out information regarding the average annual percent change in maintenance and support costs for each of the prospective ERP solutions. That information might be even harder (if not impossible) to find online, but most ERP software providers / partners should be able to answer that question for you.
4. How easy is the ERP solution to use and learn?
When moving to a new ERP solution, you’ll want to consider how easy the software is to use and learn. If it’s overly-complicated then users will be less likely to adopt the software, which can lead to some serious issues down the road. Implementing an ERP solution that has a smaller learning curve will not only reduce the initial training costs associated with a new ERP implementation, but also the on-going costs that your company will incur as you hire and train new employees. It’s also very important that you ask the ERP solution provider(s) what type of training and resources they offer their user-base. Typically, ERP products with a larger user-base will have a more active online community and offer users access to a more robust product resource library. Which makes it a lot easier for your users to learn the new product, and will also reduce their reliance on customer support services.
About a month ago, I bought some jeans from my favorite retail clothing chain. The jeans fit perfectly- at first. After a few wears, they stretched out beyond return and I wanted to exchange the jeans. Problem: I didn’t have a receipt and I had washed them several times. To my surprise, it wasn’t a problem! The clothing store had my purchase history chronicled in my user account. I just had to provide my email address. They accepted the jeans, no questions asked, ordered the correct size since they didn’t have them in store, to be delivered to my front door. I was delighted at the ease of the experience! I walked away happy and satisfied, with an increased sense of loyalty towards the company that just took amazing care of my needs. Read More
As experts of retail solutions, we here at ITK Solutions Group like to keep our eye on emerging retail technology trends to ensure that our clients are fully equipped with the tools necessary to meet their business objectives for 2016 (and beyond). With plenty of emerging retail technology to be excited about in 2016, it was difficult to narrow it down to just five. But the five emerging retail technology trends that we’ve selected below have all shown significant potential over the last few years, and it should come as no surprise that mobile devices are at the forefront of the discussion. We’ll start out our list with Beacon technology.
1. Beacon (BLE)
Beacon technology provides traditional brick-and-mortar retailers an opportunity to bring the power of digital marketing, in store. With nearly two-thirds of American consumers owning a smartphone, it’s easy to see the massive potential that beacon technology has for retailer’s still leveraging physical store locations to drive revenue. Especially when you take into consideration the appeal of having personalized offers sent out to consumers as they’re physically in the store location. So how does it work?
Beacons use Bluetooth Low Energy (BLE) technology, a more energy-efficient variant of other Bluetooth technology that permits two-way communication between devices, triangulating the position of each within a set perimeter. This eliminates the need for Wi-Fi, GPS and 4G, and is compatible with any Android or iOS smart device that’s Bluetooth enabled. These beacons provide valuable insight into, in-store, customer-behavioral data. Data that allows marketers to more effectively custom-tailor the offline experience customers have in their physical store locations. To be more specific, beacons send consumers (within a predetermined range) push notifications or alerts regarding their product offerings, discounts and much more. These alerts / notifications can be custom-tailored based upon the consumers previous brand interactions.
The caveat, there are more than a handful of consumers that might find this type of technology to be invasive and a violation of their privacy. Retailers that choose to leverage beacon technology will need to be up-front and clear regarding what data the beacons can collect, and how it will be used.
Traditional brick and mortar retailers have long desired a more efficient way of capturing valuable information about their customers. Specifically, information regarding their activity within physical store locations. Unfortunately for most retailers, it’s not as easy to capture consumer behavior data, in-store, as it is for online purchases. Yes, some retailers have implemented loyalty programs that have yielded some success, but that strategy still fails to measure critical KPI’s.
With Biometrics, retailers are able to view traffic flows within physical store locations, identify customers, custom-tailor offers, identify known shoplifters, view customer purchases, and the list continues to grow. More specifically, it’s a great way for retailers to capture valuable, in-store, customer behavior data. Thus allowing retailers to see which items customers were most interested in, and adjust their store layout / offers accordingly. While also making transactions more secure for their customers by using a biometric authentication process (fingerprint identification, facial recognition, hand geometry, vein recognition).
TechNavio, an independent research firm, predicts that Biometric technology will grow in the retail vertical at a 21.3% Compound Annual Growth Rate (CAGR), between 2016 and 2020. With security being a key driver for retailers choosing to adopt biometric technology.
3. Mobile POS Solutions*
Mobile Point of Sale (POS) solutions are already being implemented by retailers (both big and small). And every year, more and more retailers are choosing to adopt mobile Point of Sale (POS) solutions in an effort to enrich their customers’ in-store experience. 451 Research, LLC predicts that the mobile POS install base will increase at a 32% Compound Annual Growth Rate (CAGR), as Mobile POS technology continues to grow in existing verticals, and expands into new ones.
Implementing a mobile POS solution and integrating it into your current (ERP / CRM) solution, is much more than just a trendy way to check-out customers. It connects the dots between sales channels, and provides retailers a unified view of their customer purchase data. Mobile POS solutions not only increase sales through mobility, they also increase efficiency by allowing sales associates to check in-store / online inventory, right from their mobile device. Providing them with more information, and making it easier for them to better serve customers, in-store.
The growth of mobile POS in the retail marketplace can also be directly attributed to the shift in the way(s) consumers choose to pay for their products and services. A few great examples of emerging payment solutions include: Apple Pay, Samsung Pay, Google Wallet, PayPal, and Bitcoins. Retailers that implement mobile POS solutions that are configured to handle the aforementioned emerging payment solutions, will reap in the dividends as these new forms of payment grow increasingly more popular among consumers.
*Note: Mobile POS capability is contained in one of our solution offerings: Microsoft Dynamics AX for Retail.
4. Digital Currency
Digital currency (or cryptocurrency) comes in many different forms, but for the sake of simplicity, we’re going to focus on Bitcoins for this blog post. Mainly because it’s the most popular in terms of digital currencies, and it’s already being accepted by some of the larger retailers such as Amazon, Overstock, Microsoft, Expedia, and TigerDirect.
Simply defined, Bitcoins are a form of digital currency in which encryption techniques are used to regulate the generation of currency and verify the transfer of funds; operating independently of a central bank or government (decentralized). If that definition is too cryptic, refer to this video for a more detailed explanation.
As a retailer, it’s not imperative that you accept Bitcoins as a form payment. However, Bitcoins can be advantageous for retailers in many ways. A few of the main advantages being: reduced transaction fees, the elimination of charge back fraud, access to an entirely new customer base, and the fact that Bitcoins don’t require a middle man between the retailer and the customer (banks / government).
The growth of the Bitcoin community has seen a significant spike over the past few years. However, the value of a Bitcoin drastically dropped 67% in 2014 (from $951.39 to $309.87 per Bitcoin). The fluctuation in value is a big reason why most retailers are reluctant to accept Bitcoins as a form of payment, which is understandable. But, it’s still important that retailers pay close attention to the digital currency market, and make a plan to invest in the infrastructure that’s necessary to accept these new forms of digital payment.
5. Social Media Platforms
While social media may not be an emerging technology, it has only recently become a place for retailers to directly sell to their customers. And over the past few years, social media has shown significant growth as a sales channel (both direct and indirect). Social media giants like Pinterest and Facebook have given retailers the option to embed “Buy now” buttons on their posts. Making these social media platforms a direct sales channel for their goods and services. Business Insider mentions that the top 500 retailers earned $3.3 billion in 2014 from social media channels alone. And that number will only continue to grow as more social media platforms start to pop-up, and as marketers learn how to more effectively leverage the strengths of each platform for their selling efforts.
Frequency is another big reason why social media is growing so rapidly as a sales channel for retailers. The majority of users will login into one (or more) social media platforms, on a daily basis, and that type of frequency allows retailers to stay top-of-mind. It’s also worth mentioning, most social media platforms provide retailers an option to create a custom sponsored post, or paid advertisement along the sidebar; targeted toward specific customer segments. Both of which have shown to directly increase the amount, and quality of referral traffic retailers see on their ecommerce sites.
When used to its full potential, social media can be an extremely powerful tool for retailers looking for new ways to sell their products /services, build brand awareness, create brand advocates, drive traffic (in-store and online), and much more.
For all your system integration and mobile POS needs, contact us at firstname.lastname@example.org. And to stay In The Know, connect with us via social media, and keep an eye on our Knowledge Center for new content.