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ERP For Small Business
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A Beginner’s Guide to ERP Systems for Small Business
A Beginner’s Guide to ERP Systems for Small Business 700 500 Xcelpros Team

Introduction

Enterprise resource planning (ERP) software can help any small to medium enterprise (SME) flourish and grow.

Six key benefits of using integrated ERP in a small business are:

  • Sharing information between different business processes such as inventory management and finance.
  • Enhancing productivity through using a single database accessible to all relevant departments.
  • Improving control and reducing operating costs by reducing data entry errors.
  • Greater flexibility, allowing the company to rapidly adapt to changing conditions such as supply chain disruptions brought on by new Covid-19 restrictions.
  • Boosting sales through tighter inventory control.
  • Enhancing data security when using cloud-based products such as Microsoft Dynamics 365 (D365).

Figure: 1ERP Software for Small Business 6 Key Benefits

Benefits Of ERP software for small business

Upsides and Downsides to an ERP

Updating a small business to a modular cloud-based ERP program like D365 has its drawbacks. They include:

  • Resistance from executives, managers and workers. They don’t understand why they can’t keep using the same old spreadsheets the same old way. ERPs are much more efficient.
  • Cost of licensing and installation, which is generally done with the help of the right ERP consultants. Costs are recovered through increases in efficiency. The ability to respond quickly to customer requests generates more sales.
  • Possible on-site computer upgrades as the primary servers migrate to the cloud. High speed internet connections permit real-time viewing of data regardless of location.
  • A potential reduction in productivity while the new system gets online and the staff adapts to the new ERP. Eventually, users get to the point that small errors like typos or duplicate data entries disappear entirely, further boosting productivity.

These drawbacks are easily offset by an ERP’s inherent advantages, especially when using a modular system like D365. Additional functionality can be added as the business requires. Each module can also be expanded, adding more users and increasing capabilities such as storage.

Among the factors to consider when choosing an ERP system are the willingness of different departments to share data, and more importantly, contribute to eliminating any disintegrated processes. Finance will know what sales has in the works. Sales will know what raw materials Inventory has on-hand. Production will know when the next big order is coming up. Departments need to move beyond the “what’s mine is mine and no one else’s” mentality. A unified ERP such as D365 allows companies to do just that.

For example, sharing access to data means managers and executives have the ability to spot and correct errors quickly. They can also keep tabs on what every connected department is doing. An example is having inventory, production, finance and sales working together ensuring a project is delivered on time and on budget.

Another advantage of using an ERP in a small business is scalability in terms of:

  • Expanding existing facilities
  • Adding potential new suppliers
  • Increasing the size of projects
  • Increasing product lines

Inventory Control or Finance?

Two of the most visible and valuable D365 ERP modules are Supply Chain Management and Finance. Both are appropriate for small and medium businesses updating their systems. Which one to install first depends on the company’s current and future needs.

D365 Finance lets companies of any size, “Assess the health of your business, improve financial controls, and make timely decisions to drive agility and growth using comprehensive, real-time financial reporting, embedded analytics, and AI-driven insights,” Microsoft states.

For example, the artificial intelligence built into the software lets SMBs do a better job of managing business applications. Key elements include:

  • Accurately determine project cash flow
  • Predict customer payments
  • Rapidly provide budget proposals
  • Simplify financial management
  • Automate vendor invoice processing
  • Manage credit risks and collections
  • Provide a unified information source

When the company’s major issue is a lack of accurate inventory management, such as small business manufacturing, then D365’s Supply Chain Management module makes sense as one of the first modules.

One of Supply Chain Management’s critical functions is its ability to improve product deliveries. Functionality like creating barcode labels enhance a business’ ability to track supplies. Labels coupled with hand-held scanners or cellphones indicate where raw materials are in terms of their physical location. They also indicate where they are in the production cycle. Tracking continues from the time items arrive at the warehouse to when they are delivered as finished products.

Tracking incoming and outgoing ships is also a key reason to invest in the Supply Chain Management module. In a world beset by an ongoing pandemic, it’s important to know that raw materials will continue flowing. Last minute delays can make or break a company’s production schedule.

When the Supply Chain Management module ERP is used in small business manufacturing, companies are able to more accurately schedule certain production tasks. This leads to overall equipment effectiveness (OEE) being maximized.

When combined with internal Internet of Things (IoT) sensors, production machines can provide a continuous stream of wear data. Instead of shutting down a production line while waiting for a replacement part to arrive, the part can be ordered in advance so it is on-hand when needed. Production delays are reduced while active working time increases.

The Supply Chain Management module also helps provide advanced knowledge of potential quality control issues before they occur. Instead of wasting raw materials and worker time making deficient products, information from the Supply Chain Management module helps managers know when to stop production and resolve the issue. This boosts efficiency by maximizing raw material use.

Supply Chain Management and Finance are two of the D365 modules. Other Microsoft products cover Sales, Marketing, and the overarching Business Central (ideal for a company that is small)

Data Security

Another issue plaguing businesses worldwide is industrial espionage, also known as data theft. Private and some state-sponsored actors gain access to a company’s data and then threaten to destroy or corrupt it unless a ransom is paid. Even then, proprietary formulas and patent information may be sold to an unscrupulous competitor.

Some small businesses lack the resources to prevent every potential data theft attempt. Using a cloud based ERP like D365 for small business means you have Microsoft’s massive team protecting your data in distributed server farms. Data is safely stored away from company property that can be damaged or destroyed by a fire, flood, hurricane or earthquake.

Information as a Product

Today’s businesses buy, sell and use one main product, regardless of industry: information.

ERPs store information in a central repository, available to anyone with the right access. Older programs tend to silo data: Sales has its data. Finance has its numbers. Inventory has its own database. None of them share what they know effectively or efficiently.

ERP systems configured for a small business let it use its information much more efficiently. Data produced in the factory is immediately viewable by Inventory, allowing that department to order just enough materials to meet expected demands. When potential supply chain disruptions are forecast, Inventory and Finance working together, can quickly determine the best way to minimize impacts on production.

This allows small business’ funds to be used more wisely, allowing the company to make wiser investments as they continue to grow.

Final Thoughts

Modern ERPs like Microsoft Dynamics 365 can help small businesses grow by efficiently using data it produces on a daily basis, and helping remove artificial barriers and data silos, allowing information to flow freely to all departments of a company. Help with selecting the right ERP is best achieved with a team that understands your industry, and supports the best products along with the experience to implement them.

Book a consultation with our ERP expert to learn more about ERP for small business.

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Advantages of Using an ERP System to Ensure Regulatory Approval
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Advantages of Using an ERP System to Ensure Regulatory Approval
Advantages of Using an ERP System to Ensure Regulatory Approval 700 500 Xcelpros Team

Introduction

Employing the right enterprise resource planning (ERP) system can help pharmaceutical companies gain regulatory approval of drugs and other new products faster and with fewer requests for missing information.

“One of the benefits of enterprise management systems is that much of the data these regulations require can be collected through automated means. Thus, enterprise systems can be used to ensure compliance with increasingly onerous federal regulations without taking personnel away from their essential customer service functions,” the University of Scranton states.

Other advantages of an ERP system include:

  • Real-time data access
  • Standardizing business processes
  • Secure data
  • Usable and shareable data

The FDA Approval Process

The U.S. Food and Drug Administration’s (FDA) Center for Drug Evaluation and Research (CDER) is the agency responsible for ensuring new drugs follow the regulatory approval process. CDER does not test drugs but its Office of Testing and Research performs limited drug quality, safety and effectiveness research.

CDER physicians, chemists, pharmacologists, statisticians and others review every piece of new drug application (NDA) data. This includes labeling, which follows specific FDA formatting and requirements.

The FDA currently has 12 approval steps that follow preliminary drug development. ERPs are designed to ensure pharmaceutical companies keep accurate track of every step from the purchase of raw materials to the labeling of individual samples.

Figure: 1FDA’s Lengthy Drug Approval Process in Twelve Steps

Regulatory Compliances

Gaining FDA Approval

Pharmaceutical manufacturers can easily invest years and years, and vast amounts of money developing a new drug therapy.

The regulatory approval process itself can take 6 to 10 months depending on how many benefits the medication provides. Changes to the FDA Standard Review process in 2002 defined a 10-month goal to look at drugs offering minor improvements over existing marketed therapies.

The FDA also offers Priority Reviews with the goal of completing them in six months. These reviews are applied to drugs offering treatments where none currently exist. Priority Reviews are also given to medications that offer major advancements in treatment.

Using the most recent update to the Prescription Drug User Fee Act (PDUFA)—the sixth version—the FDA uses collected fees to hire more reviewers and support staff.

These fees are not cheap. In fact, according to the FDA, the 2021 application fee with required clinical data is $2,875,842, a change of -2.3% over 2020 ($2,942,965). The FDA can also issue additional invoices for program fees not previously invoiced.

User Fee 2020 2021 Change
Application Fee: Clinical Data Required $2,942,965 $2,875,842 -2.3%
Application Fee: No Clinical Data Required $1,471,483 $1,437,921 -2.3%
Program Fee $325,424 $336,432 +3.07%
Source: FDA

Regulatory Audits

The FDA inspects and assesses regulated facilities during a regulatory audit. Some of the audit information is released to improve the public’s understanding of how the agency protects public health, its website states.

According to the FDA, “Disclosure of a firm’s inspection information encourages firm compliance and provides the public with an understanding of the Agency’s enforcement actions and an ability to make more informed marketplace decisions… Laboratory records and logs represent a vital source of information that allows a complete overview of the technical ability of the staff and of overall quality control procedures.”

The FDA has 10 detailed inspection guides related to drugs alone. For example, the guide for pharmaceutical quality control labs has 21 sections, which includes laboratory management.

The Role of ERP Systems in Regulatory Compliance

The Microsoft Dynamics 365 ERP platform seamlessly gathers data from different teams and stores it on Microsoft Cloud Servers. Researchers can review records during the development phase. Easy access to earlier successes and failures ensures work is not duplicated, increasing efficiency. Microsoft 365 has the ability to let information technology (IT) administrators apply labels to different documents. These labels let companies classify and protect sensitive data—like formulas—allowing access only to qualified, approved users. Sensitivity labels also apply content markings that can encrypt data, preventing it from being viewed by competitors and outside sources. Pharmaceutical companies can control who is able to view this data and for how long.

Regulators are allowed to see only the data they need, not private, confidential materials.

During the Investigational New Drug (IND) phase, the sponsor submits an application containing the drug’s composition and manufacturing and an outline of the human trials. Among the documents being reviewed in this stage are those related to informed consent and human subject protection.

The ERP Regulatory Advantage

ERP software has several advantages over using spreadsheets and external databases when dealing with regulatory compliance.

A key element is tracking the supply chain from ordering raw materials to delivering finished products to customers. Microsoft Dynamics 365 Supply Chain Management is an example of an ERP product that uses a single, secure, cloud-based database to eliminate duplicate spreadsheet entries and transposed numbers. Additional key compliance benefits of using the right ERP include:

  • Visibility and transparency: ERPs have lot and serial number traceability, tracking material flow. This is a common compliance requirement.
  • Audit trails: This is included in D365, allowing administrators to know who accessed the system and when, what actions—including file deletions—were taken and where updates originated. Auditing can be enabled or disabled for an entity or specific fields within an entity.
  • Data access and security controls: these are built into Dynamics 365 products as mentioned earlier.
  • Encryption: Transactional data is securely stored and automatically encrypted when accessed by authorized individuals.
  • Electronic signatures: Secures transactions by confirming the operator is authorized while also creating a transaction summary and log.
  • Record Retention: D365 allows this to be set through the Privacy settings and elsewhere. For example, D365 Finance automatically saves attached documents for 180 days. That number can be adjusted through the document management parameters > General > History > Enable document history settings
  • Inspection Controls: D365 allows companies to store and track test evidence, ensuring materials meet quality control standards.
  • Document Controls: Tracks and manages formulas, engineering specifications, material specifications, operating procedures and other document types.

Summary

Getting a drug approved by the FDA is a time-consuming, expensive proposition. The cost of regulatory approval for pharmaceutical products can easily exceed $3 million in government fees alone.

The right ERP can help companies track materials throughout the supply chain and product development. This enhanced tracking and secure data storage reduces the efforts required to navigate the drug approval process.

Book a assessment to learn how an optimized ERP system ensures regulatory approval.

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5 Key Reasons Why Distributors Should Invest in a Robust ERP
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5 Key Reasons Why You Need ERP Software in Distribution
5 Key Reasons Why You Need ERP Software in Distribution 700 500 Xcelpros Team

5 Key Reasons Why You Need ERP Software in Distribution

Distribution management, supply chain and logistics planning can be few of the most challenging areas for any wholesale distribution company. Especially today, implementing the correct solution has become much more affordable, offering significantly improved response times, increased efficiency, and stronger customer relationships. For more information see the full article here.

Invest in a robust ERP system to streamline your distribution operations. Start your trial!

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ERP in the Oil and Gas Industry
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ERP Solutions to Rev Up Oil and Gas Industry
ERP Solutions to Rev Up Oil and Gas Industry 700 500 Xcelpros Team

At a Glance

The Oil and Gas Industry is highly dynamic and volatile. Wars, politics and environmental concerns are some of the stressors affecting a capital-intensive industry. Centralized software that manages the nuances and intricacies will boost each company’s financial performance.

Enterprise Resource Planning (ERP) systems, which are becoming more common in many other industries, help to integrate all related tasks. One of the best examples is inventory and finance, letting companies know what they have and how much it’s costing them. ERPs help create a performance standard, letting companies set goals and use real-time data to know if they’re achieving them. Effective ERP solutions easily integrate tasks, manage risks, localize financial accounting and ensure quality checks.

Introduction

A slang term for crude oil is “black gold” because of its value. Oil is a pillar of the world economy, with prices playing a major role in determining the cost of goods and services around the globe. The industry’s size, complexity and high operating costs all demand organized management. Executives need to know where each asset sits in the pipeline. They need accurate, detailed data for planning and budgeting plus inventory and distribution.

Integrating ERP in the Oil and Gas Industry

More and more oil companies and refineries are starting to embrace ERP software solutions. Why? Because it addresses real-time business operations. Areas that benefit the most include:

  • Obtaining raw materials
  • Monitoring production
  • Managing inventory including spills, waste and burn-off
  • Tracking handling equipment

One major challenge facing oil companies is their broad distribution. For example, they can have production facilities in the Middle East and refineries in the United States, Europe and China. This means they have to maintain distribution routes almost everywhere.

Oil companies have an intricate supply chain that never stops working. This can add undue stress to both employees and equipment.

ERP software lets companies monitor operations from anywhere. They can know now, not in a week, the status of an oil field in Saudi Arabia or a tanker going through the Panama Canal. Modern ERPs help identify different ways to improve efficiency while boosting flexibility.

5 Key Reasons to Add an ERP

ERP solutions are the most viable option for improving production and overall management. Traditional companies in the Oil and Gas industry stand to gain significant advantages when they implement a modern ERP solution, including:

Figure: 1Key Reasons to Add an ERP

Key Reasons to Add an ERP

  1. 1.Ease of Integration: ERP solutions are designed to be stable, easily scalable and flexible. They function on-site and with cloud systems. ERP systems especially shine in asset planning and budgeting lifecycles. ERP solutions such as Microsoft Dynamics 365 easily integrate with a suite of related third-party programs. Instead of having a plant’s production department using one system and inventory management using something else, the entire operation is integrated into a single system. By having departments talk to each other, business meets its productivity standards, regulatory requirements and other deadlines.
  2. 2.Effective Risk Management: Risk management is a vital component of everyday business activities in the oil and gas sector. Geopolitical pressures, environmental concerns, social activities, asset damage, cost overruns for high-value construction projects, fines for non-compliance, cyber threats and protecting personnel: they all impact daily operations. Integrated ERP solutions let management identify potential risks. You can detect risks before they become expensive problems. Companies can balance and manage multiple operations simultaneously, ensuring they all run smoothly. By seeing how the supply chain functions in real-time, companies can prepare emergency contingency plans.
  3. 3.Efficient Project Management: A key advantage to ERP software such as Microsoft Dynamics 365 Supply Chain Management is its ability to manage complex supply chains regardless of their locations. An effective ERP helps manage both offshore and onshore operations, streamlining procedures driving basic business goals, helping to move raw materials to new markets. As individual shipments move from wells to refineries, ERP software lets companies adhere to regulations in every country and state along the way.
  4. 4.Localizing Financial Accounting: Oil and gas companies are aware of the huge capital investments, long lead times and unfavorable environments needed to extract and process their raw materials. Exploration and production frequently involve joint ventures to share the costs. Once the product is pulled from the ground, these companies face multiple regulations, compliances, currency risks, commodity pricing and other challenges as they move it from the wells to refineries and then to consumers. Efficient ERP solutions keep track of the regulations, taxes and fees in each region. They provide detailed financial records at every step.
  5. 4.Quality Control: Robust ERP solutions also integrate state-of-the-art engineering utilities matched with high-end total quality management (TQM) functionality. The result is a 360 degree view of quality issues, helping to address problems more quickly.

5 Features to Look for in an ERP Solution

Now that you’re aware of some possible uses, it’s equally important to make sure these five features are in whatever ERP solution you choose. The Oil and Gas sector’s sensitivities create unique requirements from its ERP solutions. These following features continue to be increasingly related to real-time operations and complex business compliance issues.

  1. 1.Asset Control: Managing all assets—such as locating new resources, acquiring them, and then refining the products—is vital for efficient operations. When you’re trying to find the best ERP System for an Oil and Gas Company, you’ll want to make sure it defines and tracks your assets, monitors their usage and availability, manages all documents, integrates mobile apps and data, and submits reports.
  2. 2.Agile QA Processing: Quality assurance is the key to constant improvement, especially in the oil and gas sector. Finding more efficient ways to convert raw materials into finished products helps offset research and development costs.
  3. 3.System Integration: Integrating existing software is often a key decision point in getting an ERP up and running quickly. It’s critical to make sure that whatever ERP solution you choose meshes with the software your employees use daily, otherwise you may face delays while work-arounds are developed. The perfect ERP solution creates superior analytics using real-time data from different sources. This will include workflows and service calls.
  4. 4.Standardizing Data Processes: The Oil and Gas industry is heavily impacted by precise management of workflows and global market analysis. Effective ERP solutions use a standard data storage method. Using this method, companies can balance multiple projects no matter where they occur: upstream (exploration and drilling), midstream (transportation, storage and processing) or downstream (refining crude oil and purifying natural gas).
  5. 4.Compliance: Many ERP solutions fail to deliver when it comes to overseeing complex compliance issues. Not being accurate often causes problems over time. Effectively managing different government regulations—such as when a pipeline crosses national or state borders—is a key benefit of a robust ERP solution.

Final Thoughts

The best ERP solution for companies in the Oil and Gas sector is one that:

Companies that navigate smoote implementations often start training almost from Day One. Training employees early gets their buy-in and lets people learn how D365 can make their work lives easier.

  • Integrates with a company’s current third-party software
  • Tracks inventory, plans capital projects and creates emergency plans
  • Streamlines the data into a unified flow
  • Collects data from diverse systems scattered around the globe
  • Allows the data to be used by any division
  • Integrates information from devices equipped with industrial internet of things (IIoT) sensors
  • Aligns with your company’s requirements to ensure minimal waste and deliver the best results

Expect nothing less than perfection. Having the right ERP solution will help you achieve just that.

Book a assessment to get started with tailored ERP Solution for your Oil and Gas Company.

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Removing Roadblocks when Implementing Microsoft Dynamics 365
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Removing Roadblocks when Implementing the Microsoft Dynamics 365
Removing Roadblocks when Implementing the Microsoft Dynamics 365 700 500 Xcelpros Team

Recap

In a previous post, we looked at the basics of the high-level steps involved in adding Microsoft Dynamics 365. In this post, we will take a look at common implementation problems and ways to avoid them or reduce their effect.

It’s time for a change. Your company decides to modernize with Microsoft System Dynamics 365 Finance to automate and modernize your financial operations.

Now you need to make it work for you.

Four Challenges

The four main challenges that can impact an ERP implementation project’s budget and timeline are:

  1. 1.Applying experience with other enterprise resource planning (ERP) systems, expecting Dynamics 365 to behave the same way. It will not.
  2. 2.Users may expect certain functions built into D365 because of the previous ERP. These functions may have been customized to get where they are. Attempting to add them can keep the project from achieving its objectives and add constraints.
  3. 3.Wish lists items can also cause the implementation cost to go out of control. A Change Champion can reign in these wish lists to ensure the right amount of focus is placed to achieve the best possible result.
  4. 4.Using inaccurate information from other companies’ installations researching a different D365 module.

Being aware of these issues from the beginning will help avoid a failed ERP implementation.

Figure: 1Main Pitfalls affecting a project’s scope, budget and timeline

Main Pitfalls affecting a project's scope, budget and timeline

Common Problems and Causes

These are a few of the most common D365 implementation problems and their likely causes, each of which can frustrate executives and employees.

Problem Example Possible Cause
A tool or important feature was left out Payment terms are missing A scenario was misspelled or overlooked in the Design Phase
Legacy data upload is incomplete or corrupted Names are misspelled, dates are wrong, amounts are inaccurate, etc. Data was not input properly into the legacy system
A specific configuration is incomplete or not working properly Departments are not being notified when payments are made Lack of communication between staff and implementation team

The most likely cause for the majority of these issues is communication. For example, the implementation team did not clearly understand what was being asked, or different people requested changes to the same section.

A good way to resolve communication problems is by having the Change Champion review and approve the updates during the design phase. Customization best practices means having the Change Champion approve or deny all change orders and requests.

When data is not properly entered into the system, the business will need to search its records and recreate the missing material.

Other Common Implementation Problems

One of the most common reporting issues deals with those at the end of a month. For example, Inventory shows 10 barrels at $10 each were used. However, Finance shows 9.2 barrels were used, resulting in a dollar discrepancy.

This is the kind of issue best brought up during user access testing (UAT) when the implementation team can define cell properties. That way, inventory and finance agree.

D365’s Finance module has detailed reporting options. The ability to input data depends on a person’s security roles, privileges and duties. For example, someone who wants to “Generate financial reports” must have that role, privilege and duty assigned to them.

When a user needs to generate a report and can’t do it, they should talk to the system administrator or security administrator, Microsoft states.

Reports used data input into the system. When data is not being accurately added, reports will reflect the inaccuracies.

An excellent way to resolve these issues is by involving the training team early and often. Have them create training materials and then have users perform the tasks in the UAT environment to ensure everything works as designed.

Following Methodology

D365 implementations follow a strict methodology. Problems occur when executives or employees try to get around the system. Seeking an easier path by using a method from the legacy system usually causes problems with D365.

Dynamics 365 is set up logically – Form follows function, step follows step. Trying to go from Step 2 to Step 6 without performing the intermediate actions is a recipe for trouble.

Microsoft has its own “Sure Step Methodology” as part of its ecosystem. This methodology:

  • Is designed specifically for Microsoft implementations
  • Defines key activities and deliverables
  • Provides tools and templates

Focusing on the ‘To Be’

Change, no matter how beneficial, is always stressful. Many people are comfortable performing tasks a certain way. They are uncomfortable doing it differently.

When employees focus on the “As Is,” which is how tasks were done with the legacy system, they get bogged down and have trouble adapting to D365. Instead, they need to consider the “To Be,” which is the end goal.

For example, Inventory uses one legacy system and Finance uses something different. Some fields are identical but others are different. In D365, both departments must change how and where they input data.

By focusing on the “To Be,” the end result of implementing D365 is a leaner, more accurate and more profitable business that benefits both departments.

Here’s an example of “To Be.”

  1. 1.Intelligent financial information using data from multiple sources permits intelligent operations.
  2. 2.Intelligent operations lead to improved productivity.
  3. 3.Improved productivity leads to faster fulfillment, which leads to timely delivery.
  4. 4.All of these steps lead to increased profitability, which funds improvements in everything else.

The Value of Microsoft Dynamics

One way to implement change management is by explaining some of the values inherent in Microsoft Dynamics.

These values include:

  • Empowering employees, giving them real-time access to actionable data
  • Driving faster innovation
  • Facilitating smarter decisions with user-based workspaces
  • Delivering real-time responses to customer demands
  • Reducing transportation costs and increasing delivery accuracy
  • Scaling up or down as the business changes
  • Using mobile phones, tablets and other devices that let employees perform more tasks where they work

Summary

Implementing Microsoft Dynamics 365 is often looked at as complicated, or fraught with problems – but only if you let it. Taking a forward thinking approach focusing on your “To Be” goals helps the implementation move forward faster.

Companies that navigate smoote implementations often start training almost from Day One. Training employees early gets their buy-in and lets people learn how D365 can make their work lives easier.

Having a Change Champion helps keep the implementation on time and on budget.

Anticipating problems before they occur allows managers to head them off. Change will occur. Instead of resisting, workers are better off spending that energy on learning how to maximize their value.

The overall result will make your company more efficient, more agile and more profitable.

Get More Done

Improve your chemical, pharmaceutical or life science business by updating your ERP to Microsoft Dynamics today. Visit www.xcelpros.com (a Microsoft Gold Partner) or call 1-855-411-0585 to learn more.

dynamics 365 implementation
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Making your Dynamics 365 implementation successful
Making your Dynamics 365 implementation successful 700 500 Xcelpros Team

Scenario

Your chemical or pharmaceutical company has an outdated, outmoded, clunky legacy enterprise resource planning (ERP) system. Finance is complaining that Inventory is unable to produce the right numbers. Sales is wondering why nothing ships on time. Departments and executives are angry at each other because their individual systems work just fine but nothing works together.

It’s time for a change. Your company decides to modernize with Microsoft System Dynamics 365 Finance to automate and modernize your financial operations.

How do you make D365 work the way you want it?

Installation of D365 ERP is a Process

Implementing Microsoft Dynamics 365—or any other ERP system—is a process. It takes time. It’s not a matter of just downloading some software, letting it run and then “boom,” your company is up and going.

There are as many as three tiers and four production stages.

Tier 1 looks at the “out of the box” Dynamics 365 solution. Is it going to work for your company as is? For existing companies, especially those with legacy systems, the odds are that your D365 will require some customization. At a minimum, your staff will need at least some training on Dynamics 365 to be able to successfully perform their jobs.

Tier 2 is known as “the Sandbox” because this is where your staff gets to play with Dynamics 365’s wide array of features. Sample customer data—purchase orders, sales orders, etc.—is loaded. This tier is also where your experienced employees examine the product closely. For example, a person who inputs purchase orders can see how D365 performs this function. Is something you need missing? Let an implementation professional know so they can modify the program.

The final environment is Production – a live environment where business will perform its functions.

Typical ERP implementation has 4 major phases (which could still change based on the implementation):

Figure: 1Primary Phases of Dynamics 365 Implementation

D365 finance supply chain management

  1. 1.Scoping and blueprinting: This is where Xcelpros SMEs help your company determine which Dynamics 365 features and modules are best suited to achieving your goals. The topics you’ll want to discuss include:
    1. a.Your pain points
    2. b.The issues you have now
    3. c.What you would like to accomplish
  2. 2.Design and development: This phase involves configuring Dynamics 365 to install the features you need to run your business. For example, there may be specific fields—like part of a formula—that aren’t currently a part of D365. This field needs to be programmed and added to the software. Other fields may be worthless. You want them removed to avoid confusion.
  3. 3.User acceptance testing (UAT): This is where your employees get to work with Dynamics 365 in a hands-on environment similar to the Sandbox but configured for you using generated test data. This is used to determine:
    1. a.What questions do your employees have?
    2. b.Do the modules behave the way they are designed?
    3. c.Is something you need missing?
  4. 4.Going Live: D365 is now ready to go. The production environment is fully set up and the master data is loaded. Actual sales orders, purchase orders, production orders and inventory data are ready. It’s finally time to make the change.

Implementations Take Time

Dynamics 365 implementation timelines can vary greatly from organization to organization –

  • 0 days: The amount of time a company is effectively out of business during the implementation process
  • 3 – 9 months: The time for a rapid implementation involving three entities: two chemical and one pharmaceutical
  • 10 months to 2 years: The time a typical full implementation takes when a company converts from a legacy system

Selecting an Executive Change Champion

One of the biggest obstacles to a successful implementation is having too many people making the final implementation decisions. Being known as “the person who brought our company into the 22nd Century” is a glamorous title. Many executives may want to assume the Change Champion role or at least give their input.

An old proverb says, “a camel is a horse designed by a committee.” This can be interpreted as letting too many people make requests and changes will:

  • Add confusion
  • Add costs
  • Delay the implementation

Confusion occurs when departments are not aligned on feature requirements or if there is change resistance. Some standard phrases of change resistance are – “The old way of doing things is just fine” or “This is what we are used to”

A Change Champion is a single point of contact, not a committee. They act as a relay and buffer. They relay information and requests from other executives and employees to the implementation team. They also relay requests from the implementers to the company. They act as a buffer between the legacy users who are resistant to change and the people working to improve the company through modernization.

A Change Champion:

  • Is a proponent of change in the company
  • Supports and defends the Dynamics 365 implementation
  • Is able to make difficult decisions
  • Is accountable and fully involved

They understand and are able to explain how Dynamics 365 will undoubtedly make the company more efficient and profitable, and how it stands to make everyone’s lives—from the chief executive officer to the people unloading truckloads of supplies—a whole lot easier. They’re able to explain how change will come whether people like it or not.

The Champion explains how Dynamics 365 can eliminate bottlenecks and remove redundancies.

This person is ultimately accountable for ensuring the right features are selected and installed. They are the ones with the authority to sign change orders to be able to spend money where it provides tangible value to your firm.

They make the call whether or not to add a customization or use what is already supplied. Is a feature a “must have” as in it’s required for the company to work properly or a “used to doing?”

“Used to doing” features are ones based on how the legacy ERP system operates. Employees are “used to doing” a particular task in a specific way. They resist change even without understanding that D365 makes their lives easier overall.

Training is Critical

The most successful ERP implementations occur when training teams are involved from the start. Some companies ignore it, expecting their employees to figure out the new system on their own. Others start training after the implementation process is well underway. Both of these scenarios delay getting Dynamics 365 running smoothly. They also increase resistance to the new product and its new way of doing things.

As employees begin using D365 starting in Tier 2, Xcelpros’ trainers are able to show them how to perform basic steps, and then build on what they learn. For example, have trainers use Step-Action tables to document the steps for adding a new customer. Which fields are completed first? Which are done automatically? What does someone do if an automatic field is blank?

Starting training early pays big benefits later. Employees learn that their ideas count. As they begin to use Dynamics 365 in a Sandbox environment, they become more comfortable with it without the risks involved in a live production environment. Documenting a regular process and then having employees perform it lets the trainers see what they need to update for your staff. Maybe an employee spots an unnecessary or confusing feature or a critical one that needs to be added. Getting this done early on can save your company valuable time and money.

What’s Next

Understanding the ins and outs of Microsoft Dynamics 365 is a big step towards a successful implementation. As is understanding the importance of a change champion, and the role they play. In an upcoming post, we’ll take a look at common implementation problems and some of the best ways to either avoid them or reduce the impact they pose.

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ERP competitive advantage
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Rethinking Your ERP Strategy to Gain a Competitive Advantage
Rethinking Your ERP Strategy to Gain a Competitive Advantage 700 500 Xcelpros Team

Rethinking Your ERP Strategy to Gain a Competitive Advantage

Investing in a good ERP system is a big responsibility for any company that needs a flexible system paired with rapid responsiveness looking to increase their business opportunities. Adhering to a few simple and practical guidelines can make this process a simple task, allowing executives to more effectively manage the risks of modernizing their ERP solutions to gain a competitive edge in the market. For more information see the full article here.

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Homegrown systems to modern ERP System
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From homegrown to modern ERP System: Transforming your business
From homegrown to modern ERP System: Transforming your business 700 500 Xcelpros Team

Introduction

Homegrown enterprise resource planning (ERP) programs were created to use businesses’ information technology (IT) infrastructure to help grow and manage companies.

In the 1990s, the early adopters of homegrown ERPs spent millions of dollars to modernize their technology. Their goals were making it easy to run daily operations, increase competitiveness and find ways to be more efficient. The cost of developing such an ERP system was high, making Homegrown ERP systems a prized possession for larger corporations. Only those with a strong inhouse IT team and deep pockets could build and maintain them.

For some companies, the issue of deciding whether to use an ERP system and then picking one was deep rooted. Organizations that grew through mergers and acquisitions added ERP systems as part of the package.

Other companies dealt with classic cases of “Software Snowballing” where an ERP was mixed with other software, none of which was designed to share information. This method of mixing stand-alone products drastically raises the cost of integration. It makes sharing data more complex while also adding expensive software licenses and product maintenance costs.

The good news is that was the old day. Older ERP systems lacked the flexibility and rich features of today’s modern ERPs.

Industry Speaks

During 2019’s CPhI North America 2019 Convention on Pharmaceutical Ingredients conference held in Chicago, Xcelpros staff met with decision-makers from organizations who are neck-deep in older homegrown ERP systems. These companies find themselves having vital resources slowly but steadily drained.

The people we spoke with unanimously agree that ERPs of the past are adding inefficiencies and straining existing resources. These companies recognize the importance of an effective ERP. They want to convert their investments into a program that promotes growth, collaboration and efficiency.

Early adopters were encouraged by what their ERPs brought to their companies. They kept adding more resources to the system. Over time, some critical functions started unraveling. For example, the accounting module could not keep pace with global standards such as generally accepted accounting principles (GAAP) or international financial reporting standards (IFRS). This inability to keep up leads to non-compliance issues.

From a maintenance standpoint, vendors of older systems started focusing on newer technologies. Companies with old programming tools and operating systems were left high and dry. In some cases, key personnel were tasked with maintaining an ERP on the verge of retirement. Most of our guests realized that updating a legacy system wasn’t practical since the technology is dated. With challenges outweighing the benefits, most of our guests at the CPhI were looking for a newer alternative.

Cost of Staying in Denial

One major issue for companies with homegrown legacy ERPs is the stack of standalone software. Each piece handles one part of the organization’s business processes. Licensing costs to maintain these programs often results in expensive bills at the end of every fiscal year.

The result, or what we call “the cost of staying in denial,” is severe. It grows with every passing day. Some of the common challenges faced by enterprises using homegrown ERPs are:

  1. 1.High costs to benefit ratio in maintaining legacy systems compared to modern products.
  2. 2.Incompatibility with popular business applications such as Microsoft Office 365, stifling collaboration.
  3. 3.Expensive integration required to perform regular tasks such as sales visualization. This often leads to high latency.
  4. 4.High people costs to maintain older tech that is already retired or will hit its end of life soon. In addition to the tech, the people who know to maintain it may also be leaving, putting pressure on newer staff who are hesitant to learn outdated products.
  5. 5.High costs of using a private datacenter to run the application, which is expensive. Many telecom firms worldwide are selling them to private companies. This includes Verizon and AT&T in the US.
  6. 6.Disruptions to normal business operations caused by upgrading the older ERP system. It is a time-consuming, expensive process.
  7. 7.Lack of collaboration because stand-alone applications limits growth opportunities and competitiveness.

To sum up the challenges, it is a typical case of application explosion with disjointed data sources also known as “the problem of too many.” Randomly applying partial solutions over time sucks up computing resources, increasing the overall cost of ownership.

It’s Time to Retire Legacy Systems

The companies Xcelpros spoke to at CPhI agree that their legacy systems are eating into their productivity and their limited resources. We wondered why, when chief executive officers and other top managers were aware of these issues, they had not already moved on to a modern ERP system.

Our research uncovered these issues:

  • Replacement costs and other economic considerations
  • A regressive mindset of, “if it ain’t broke don’t fix it”
  • Resistance to change management
  • Emotional attachments

It’s Too Expensive to Replace

We found comments about the perceived cost of a new ERP system were interesting, mainly because they were inaccurate. However, costs associated with switching to a new system were the most frequently cited reasons by our guests at CPhI’19.

This mindset and myth challenges years of ERP systems providers showing that new ERP systems typically save them money.

A current ERP such as Microsoft Dynamics 365 Finance and Operations actually costs up to 50 percent less than an on-site legacy system for a 100 employee company, business application provider Skyward Techno states.

When ERPs were first introduced about 30 years ago, their main feature was a uniform database that could sync information across business functions. It would ease decision making, the manufacturers claimed.

It was true … briefly. After ERPs came other targeted business applications. They include human resource management (HRM), customer resource management (CRM), product lifecycle management (PLM) and supply chain management software. Each program had its own unique database promoting “best of breed” software for their respective functions.

Companies that bought into that mindset then are now facing the problem of too many competing programs. A major issue is that specialization denies these firms the opportunity to harness the power of insights gathered by shared data.

A 2016 survey by Panorama Consulting found that nearly 65% of the organizations who implemented an ERP cited replacing outdated ERPs as the major driver for the change. The findings cited in the study matched with what we uncovered at the CPhI conference.

Figure: 1ERP Replacement Statistics

ERP replacement Statistics

With changing trends, best practices have morphed into more optimized processes that promote efficiency and shed workplace complacencies. At a time when profitability is stressed and finding a newer market is challenging, the right technology for your business can be the edge you are looking for.

Combating Resistance to Change

The adage, “If it ain’t broke, don’t fix it” is as archaic as legacy ERP systems. Delaying key technology decisions is costing companies every day they wait. Modern ERP systems such as Microsoft Dynamics 365 lowers operational costs especially when compared to older software.

The Bureau of Labor Statistics (BLS) estimates the wage for skilled labor is $17 to $25 an hour per worker. Using a median wage of $21/hr., production managers responding to sudden demand spikes need additional man hours to meet the demands. Not including overtime required by the federal Fair Labor Standards Act (FLSA), the labor costs of dealing with these demand spikes can quickly exceed projections.

Modern ERPs such as Microsoft System Dynamics 365 Supply Chain Management let companies forecast trends. This software helps plan resources, track jobs plus manage materials and scheduling. The result is a more efficient operation.

Panorama Consulting estimates that modern ERPs ability to integrate data and create accurate forecasts can lower labor costs by 20%. Reducing labor cost is just one of the many positive ways a modern ERP benefits your business.

Managing Change Effectively

Change is inevitable even with technology. Change Management has been underestimated when adopting ERP. The result is implementation failure.

Change management includes designing the right framework for transitioning from unlearning the old and accepting the new way of working. Applying change management requires careful planning, making the role of ERP consultants more critical than before.

Part of this was mentioned in the 2019 Panorama Consulting report. It states that 68% of poll respondents had intense to moderate focus on Change Management during an ERP implementation. The overwhelming response shows the importance of organizational change management. It must include key leadership buy-in, effective communication, a robust training strategy and hiring consultants.

Figure: 2Importance of Change Management in ERP Implementation

Importance of change management in erp implementation

At least 50% of ERP implementations are intended to make employees more productive. The importance of change management in erp implementation cannot be undervalued as it impacts nearly half of your organization’s strength. It is something that needs meticulous planning and must not be pushed as the last item on a long list.

Break the Emotional Attachments

Emotional attachments were never documented as reasons to stay with legacy ERPs. However, some of our CPhI guests defended them even though they also agreed that the cost of maintaining them outweighed their benefits.

Some of these people are averse to change. When an older system can’t scale up, they customize it without knowing what will happen. That method may have worked years ago. Today? Modern companies want optimized processes that promote efficiency. Having a complacent workforce is no longer acceptable.

Older ERP systems have hidden costs. Once they require that actions be documented and stored somewhere. If that information isn’t recorded, inefficiencies cannot be detected during a year-end performance review.

Old Systems Cost Money Today

Companies spent huge sums to develop or license a homegrown ERP a decade or two ago. They are paying more for its maintenance today than a modern system costs.

Newer, younger developers don’t know how to update older systems to meet modern needs. The technology in them is too old. This causes companies using them to be less efficient, reducing their ability to compete with modern firms. Older companies using stand-alone systems are unable to leverage analytics and consumer insights. They also lack collaboration between modules such as finance and inventory. Modern ERPs have these connections.

What can a modern ERP System mean to your business?

Modern ERPs are much smarter and efficient than their predecessors. They connect and unify processes and information across business functions such as Finance, Human Resource, Manufacturing, Supply Chain, Logistics, Procurement and Sales. Their connected d esign makes the system more agile, providing benefits that stand-alone systems cannot.

Some of the benefits are:

  • Making informed decisions
  • Driving collaboration and innovation
  • Increasing transparency
  • Promoting efficiency
  • Reducing dependence on human workers
  • Increasing productivity
  • Complying with quality and other government standards

Microsoft Dynamics 365 for Finance and Operation is one such ERP. It comes with cutting-edge technologies such as Artificial Intelligence (AI), Machine Learning (ML), Prescriptive Analytics and powerful visualization. Everything is unified under a single ecosystem. The ERP drives business results by integrating data across an organization. It provides meaningful insights easily accessible from a cellphone or handheld device. Backed by Microsoft, it is not only secure but flexible and scalable.

Most companies own at least one Microsoft product since Windows operating systems are on 87 percent of the world’s computers. Business applications such as PowerPoint, Excel and Word are a regular tool for most organizations.

Microsoft Dynamics 365 has a similar look and feel to popular products such as Windows and Office 365. It’s ease of use and familiar look which makes switching over a much easier task.

Conclusion

ERPs have undergone a metamorphosis. They are no longer backend record keepers. Instead, they provide a versatile powerhouse that aids in making impactful decisions accurately and quickly. Modern versions cost less than what many firms pay to keep older systems running.

Break the myth that ERPs are an all or nothing solution. Using Microsoft Dynamics 365, you can pick and choose the right modules for your business, adding more features and scaling up or down when situations change.

When updating to a modern ERP, consider using an established vendor whose product vision caters to your present-day requirements and your future needs. Firms that are part of Microsoft’s Independent Software Vendor (ISV) network have the extensive industry knowledge to guide you through your ERP journey.

Ask yourself a question: “Is my ERP system a roadblock to profitability?” If the answer is remotely “yes,” contact Xcelpros. We’ll bring the coffee.

Planning to transform you business with Modern ERP, book a consultation with our experts.

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Dynamics 365 Business Central vs Finance and Operations
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Dynamics 365 Business Central vs Dynamics 365 Finance and Operations: Comparison
Dynamics 365 Business Central vs Dynamics 365 Finance and Operations: Comparison 700 500 Xcelpros Team

At a Glance

  • Microsoft Dynamics has a range of products that are designed from the ground up for different functionalities.
  • As an enterprise, picking the right product (for eg. Data migration from NAV to Business Central and choosing between Business Central vs Finance and Operations) requires intricate knowledge about the in’s and out’s of these platforms.
  • The Microsoft Dynamics family of products offers a wide array of business applications that can provide you with the maximum efficiency and ROI for your enterprise.

Microsoft Dynamics is known for upgrading or in some cases even overhauling its range of products to:

  • Make them compatible with the changing technologies (rewriting on-premise enterprise products for the cloud)
  • Enhance business applications
  • Streamline operations management, resource planning, and/ or financial management functionalities

As an existing Microsoft Dynamics suite customer or an enterprise looking to invest in a modern product, it can be an overwhelming decision to understand the differences between Microsoft’s vast range of products. Whether it’s understanding the minute differences between Microsoft Dynamics 365 Business Central and Finance and Operations, or determining the additional features that these products offer, making an informed decision is critical.

This article discusses the major differences between Dynamics 365 Business Central and Finance and Operations.

Microsoft Dynamics 365 Business Central vs Dynamics 365 Finance and Operations: Picking the Right Enterprise Resource Planning System

First, it’s essential to understand that Dynamics 365 encompasses both Business Central and Dynamics 365 Finance and Operations. Business Central is essentially a cloud-based ERP solution on its way to replace the older Microsoft Dynamics NAV product. The dual functionality of Business Central (on-premise and on the cloud) is what makes it more efficient for operations management and resource planning. The cloud functionality of business central can be leveraged to access data 24*7 anywhere you go. This can be especially useful in recent times where remote work has jumped in scale.

Here’s an In-depth Comparison Chart to Understand the Difference Between Dynamics Business Central and Dynamics 365 Finance and Operations

Dynamics 365 Business Central Dynamics 365 Finance and Operations
User-base Previous Dynamics NAV Users Financial Compliance Teams, Vendor Management, Inter Company Stock Transfers etc
Analytics Maturity Dashboards, Reporting, Ad-hoc Analytics Advanced and More Intricate Analytics, Richer Reporting Options, Machine Learning-enabled Features, Advanced Business Intelligence Tools
Options for Customizations Developers can access open codebase for customizations Multiple plug-in options, Many Modules Available on AppSource
Implementation Cost Generally, 30% of Cost of Implementation of Dynamics 365 Finance and Operations All infrastructure costs are included
Licensing Subscription-based Model Monthly Subscription-based Model

Dynamics Business Central vs Dynamics for Finance and Operations are often compared for their scale. While Business Central is usually targeted towards smaller-scale operations (companies that want to move on from basic accounting models to intricate business analytics functionality), Microsoft Dynamics 365 offers two ERP products: Business Central and Dynamics 365 for Finance and Operations.

It’s widely considered that In time, Business Central will take center stage, possibly phasing out Dynamics NAV completely. Here are some of the more compelling reasons for this hypothesis.

Dynamics Business Central Key Benefits and Distinguishing Features:

  • Easily accessible on-cloud and/or hybrid models available
  • Better safety with its cloud-based and web-based applications
  • With Business Central, companies can get maximum use and ROI from other applications such as SharePoint, MS Excel, Outlook, and MS Word
  • Business Central offers a variety of new functionalities
  • The flexible upgrade and licensing model allows companies to be digitally agile in the implementation of software
  • Data migration from Nav to Business Central is a fully-supported, streamlined process
  • Overall implementation of Business Central is much faster, thanks to customization options, add-ons development and combination option with other Office 365 products.

In conclusion, companies that are looking for nimble, cloud-based software options for their enterprise’s accounting requirement can opt for Dynamic Business Central. On the other hand, companies looking for intercompany stock dealings, transportation management, and financial compliance solutions should opt for Dynamics 365 Finance and Operations. Depending on the requirement of companies, their IT infrastructure maturity and growth strategies, an informed choice has to be made.

Key Takeaways:

  • Dynamics 365 is an umbrella encompassing Business Central and Finance and Operations ERP solutions.
  • Business Central offers intricate analytical functionalities with the option of going cloud-based or local (on-premises) or hybrid.
  • Dynamics 365 Finance and Operations has a more niche user-base.
  • Companies can get support from experts and consultants to make the right call and for faster, smoother implementations.

Trouble choosing between Dynamics 365 Business Central and F&O? Get help from experts today!

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References: Dynamics 365 Business Central vs Finance Supply Chain Management : How to choose

Top Reasons Why SMBs Need to Invest in a Robust ERP System
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Top Reasons Why SMBs Need to Invest in a Robust ERP System
Top Reasons Why SMBs Need to Invest in a Robust ERP System 700 500 Xcelpros Team

Introduction

Growing small and medium businesses (SMBs) around the world continue to invest in ERP software hoping to streamline their operations and boost profits. Let’s find out why the increase in demand for an effective ERP system has risen in the past decade.

need of erp system in small medium businesses

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