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How to Choose the Right ERP Platform
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How to Choose the Right ERP System for your Business Growth
How to Choose the Right ERP System for your Business Growth 700 500 Xcelpros Team

Introduction

Imagine your company’s software vendor has just announced it’s no longer supporting a program your staff uses, one that over the years has helped you grow your business. Processes continue to get more complicated with data continuing to expand at astronomical rates leaving older systems behind. Your company is left with no choice: It’s time to pick a new enterprise resource planning (ERP) system for your organization.

There are two major questions that need to be answered: Which solution best suits your company right now? Is there a different solution that will help your pharmaceutical or chemical company grow from a small or medium business (SMB) to a level able to challenge the industry giants?

Choosing the Right ERP System

Before your company can evaluate products on the market, you need to understand what will work best for you. ERP News suggests that if you do nothing else, it’s important to understand the needs of your business.

Before starting the ERP selection process, it is a good idea to analyze the business processes correctly and reveal the areas that you find incomplete or that need to be improved. Source: ERP News

Figue: 1 ERP selection process

ERP selection process

There are 10 critical steps to selecting the right ERP software package:

1.Ensuring it fits your company’s business needs. It’s important to understand what your organization’s needs are now and in the future; short, medium, and long term.

2.Planning an effective budget. You want to get the most effective business ERP system for your organization. What’s the total cost of ownership? What kind of return on investment (ROI) can you expect? Which is most likely to help your company profit and grow?

3.Verifying flexibility and scalability. Just because a package is a top-rated ERP solution today doesn’t mean it can keep up as your needs grow or as market conditions change.

4.Ensuring it can adapt to new technologies. Can your solution of choice support internet of things (IoT) data? Is it compatible with cloud computing? Does it allow work from any location? Is it usable with tablets, laptops and even mobile phones?

5.Is it compatible with your existing business software? Can the new system communicate with your legacy software and devices? Will your users access old data alongside new orders and processes easily?

6.What do similar-sized competitors use? Is there a standard ERP used in your industry? What do your clients, suppliers and business partners use? What do they like and what would they change if given a chance to start from scratch?

7.Research your implementation partner. How much experience do they have in your industry? How flexible is the software and how capable is your partner? Can your implementation partner customize the software to meet your specific, demanding needs?

8.Will it grow with your business? Can the enterprise resource planning application expand, not only in terms of users but into other areas you don’t need today, but might in the future?

9.Does this project have support from upper management? If not, going through all of the other steps is an exercise in futility. Effective research will make it impossible for top management to say no.

10.Does it have a familiar look and feel? Don’t underestimate the effect changing ERP systems will have on your worker. If you don’t have user support, making it work will be tough. One way to achieve that goal is by using software similar to other programs they already use.

One last question to continuously ask along the way might be “What do we have that works well right now? What do we need to function better?”

Top ERP Systems in the US

All of the software giants have ERP systems. Depending on who you read, different companies will be on top. The dominant players are well-known software companies: Microsoft, Oracle, SAP, Salesforce and others. In no particular order, the most frequently mentioned top ERP systems are:

  • Epicor ERP
  • IFS
  • Infor
  • Microsoft Dynamics 365
  • Oracle JD Edwards
  • Oracle NetSuite
  • Sage X3
  • Salesforce CRM
  • SAP Business One
  • SAP ERP
  • Syspro
  • Workday Financial Management

Researching offerings from each one of these major companies will take time and manpower. At this point, you’ve moved on to the next stage: evaluation.

Get a assessment to find the right ERP for your organization.

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Evaluating ERP Software

According to SelectHub, choosing the right ERP system includes evaluating criteria based on your company’s needs. Typically, evaluation criteria includes:

  • Customer Relationship Management / Account Management
  • Accounts Payable Reporting
  • Bank Reconciliation
  • Benefits Administration
  • Capacity Requirements Planning
  • Material Requirement Planning
  • Bill/Build of Materials
  • Logistics Management
  • Inventory Management
  • Module Integration
  • Installation Type
  • Network Flexibility
  • Employee Training

Companies in the pharmaceutical and chemical industries should add:

  • U.S. Regulatory Compliance
  • International Regulatory Compliance

Not included in this list is one other critical criteria that can help determine if your company would be vulnerable to attacks: data security.

Where to Start

A great place to start your search for a flexible, versatile, secure and ultimately valuable ERP software package solution is by connecting with an experienced consulting service with a thorough understanding of highly-regulated industries. This should include upgrades and migration, which are commonly ignored.

There are many partners that can suggest a modern upgrade path including an in-depth migration assessment that is risk-free and cost-effective. Whoever you team with, you’ll want to make certain they have extensive experience in your industry with respect to project planning, risk management and strategy.

Our Recommendation: Microsoft Dynamics 365

Microsoft Dynamics 365 ERP solutions are easily expandable, extremely secure, and backed by Microsoft’s Azure platform. Microsoft Dynamics 365 (D365) modules include Finance, Supply Chain Management, Business Central and other related—and integrated—products. D365 can be customized and enhanced with other functionality, including products specifically designed for chemical and pharmaceutical companies. Integrated Chemical Management is a perfect example as one of Microsoft’s preferred solutions for these industries.

As a Microsoft product, Dynamics 365 has an advantage over every other competing product: a familiar look and feel. Office 365 and its many predecessors are used by millions of people worldwide. This familiarity helps your staff learn new software without having to learn an entirely new method of working.

Final Thoughts

For every business, Selecting the right ERP system for every business starts with an honest evaluation of your company and its needs. Determining where you are and where you want to go are the first steps towards ensuring your investment ultimately turns a profit and helps your organization grow.

It’s a big job, selecting the right partner along with the right software package. Thorough research and proper planning will be key to a smooth transition, but the result will be a much better implementation of a much better product. Are you ready to get started?

The Role of an ERP System in Handling Hazardous Chemicals
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The role of an ERP System in Handling Hazardous Chemicals
The role of an ERP System in Handling Hazardous Chemicals 700 500 Xcelpros Team

At a Glance

  • The chemical manufacturing industry is constantly scrutinized for its impact on the environment. Organizations in this industry are required to maintain numerous documents including safety data sheets and hazard labels with pictograms.
  • Hazardous chemicals produced and used by the industry must be properly tracked and managed in compliance with the Environmental Protection Agency (EPA), Occupational Health and Safety Administration (OSHA) and others.
  • The right ERP systems can help companies keep accurate records of these hazardous chemicals, in order to meet changing requirements.

Chemical Manufacturers – Managing Compliance

The chemical manufacturing industry is required by law to responsibly use, transport and dispose of hazardous chemicals.

According to a 2016 Harvard University report, “There are currently more than 85,000 chemicals in the US that make up the products in our daily lives and few, besides medications and pesticides, have been assessed thoroughly for safety.”

While prescription drugs and pesticides are carefully examined for their effects on humans and the environment, few other chemicals were not. That changed in 2016 with the Frank R. Lautenberg Chemical Safety for the 21st Century Act. The Act gives the EPA, “the authority to ban new and existing chemicals that pose a risk to human health and the health of the environment.”

Manufacturers are an integral part of the chemical value chain. The overall supply chain— from raw materials to finished products—now requires hazard visibility that was lacking until recently.

How can manufacturers meet these compliance standards and document what happens to hazardous chemicals?

One way is through the use of an enterprise resource planning (ERP) software system that makes record maintenance, compliance and visibility easy to maintain. A reliable ERP system is no longer an option but a requirement for chemical companies wanting to act proactively and avoid environmental or human mishaps.

Adding Xcelpros’ Integrated Chemical Management solution to the One Microsoft Ecosystem provides a comprehensive way of ensuring compliance. ERP components cover Supply Chain, Finance, Manufacturing, Quality, Document Management and Chemical Data and Documents.

Being proactive

Business processes would be simpler for bulk chemical and toll manufacturers if they could regulate hazardous substances using inventory receipts from a purchase order or production order system. Dangerous chemicals can be monitored more closely, though, when using an integrated chemical management system that tracks each chemical in every stage from raw material to finished product and wastes.

Unified systems like ERPs can help identify hazardous substances and evaluate them. Manufacturers are then informed of the risk levels regarding the use and distribution of their chemical products.

Identifying these hazardous substances early also allows manufacturers to act proactively, resulting in better safety.

Book your consultation to learn how an ERP system can help handle hazardous chemicals.

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Developing a Prototype/ Standard Operating Procedure for Worker Safety

Even after manufacturers implement hazardous chemical safety procedures, theres still room for error. Mishandling and mismanaging these chemicals can jeopardize workers’ safety. Since working with these chemicals is a part of the job, production and distribution becomes a serious business challenge. Documenting safe handling steps and ensuring dangerous products meet all current regulations helps protect the companies when accidents occur.

Microsoft Dynamics 365 and its suite of business tools integrates into SharePoint and OneDrive. SharePoint is a document collaboration system. OneDrive is more storage oriented. Combined with Dynamics 365, they provide the ability to develop a standard operating procedure or prototype process to handle chemicals. The result is a series of documents that help avoid chemical accidents and enhance worker safety on the shop floor.

Better Equipment Maintenance

Documenting equipment maintenance in a chemical plant is a tedious task. Microsoft Dynamics 365 boosted with Internet of Things (IoT) sensors eliminates much of this drudgery. It lets workers know when to take preventive actions. These maintenance “calls-to-action” are generated automatically by D365 systems. By removing the potential of errors from manual entry, the automatic notifications also boost regulatory compliance. This integrated system also lets chemical manufacturers create a complete equipment maintenance, repair and operations plan.

Figure: 1How an ERP System Helps Manage Hazardous Chemicals

How an ERP System Helps Manage Hazardous Chemicals

Systematic Record Maintenance

Many chemicals used by manufacturing companies require detailed labels. These labels include their chemical composition, risk factors, expiration dates, safety procedures and special handling instructions. Government agencies require a consolidated record listing the chemicals, their quantities, distribution, costs, etc.

Manually tracking the massive volume of data in legacy systems leads to errors. Microsoft Dynamics 365 with Integrated Chemical Management is one way to properly maintain that chemical data. Information is made visible at the individual chemical or consolidated level. Chemical companies are assured of safely using, distributing and disposing of their hazardous chemicals through an automated workflow that makes it easy to add and edit chemical data.

Meeting Compliance Standards

The ERP systems described earlier apply to regulations at many levels, not just those from the federal government. They can include notifications of additional requirements based on the shipping destination. That location can be one community within a nation or a different country.

Chemical companies looking for an ideal ERP solution that helps meet local and international documentation requirements should take a close look at what D365 and ICM have to offer.

According to the 2017 Hazard Communication Survey:

  • 70% of participants pointed to compliance as the single largest priority for their company.
  • 80% of them cited monthly obligations to create, print, or affix workplace labels to containers in their inventory as a challenge.

Microsoft Dynamics 365 and ICM provide an embedded chemical management solution for storing chemical data. That data becomes a globally harmonized System of Classification and Labelling of Chemicals (GHS) compliant labels and Safety data sheets. Using D365 and ICM is an ideal way to reduce GHS-related compliance issues.

Summary

An advanced ERP system like Microsoft’s D365 can easily become the backbone of an organization’s hazardous chemical record keeping. This sophisticated software system helps the company function and grow while also keeping the environment and communities safe. Microsoft’s Chemical Manufacturers Supply Chain solution provides a cutting-edge system to ease record maintenance, streamline the overall chemical supply chain, track inventory and warehouse management processes and create a platform for productivity and growth.

Key Takeaways

  • Integrating chemical data into an ERP system is necessary for chemical manufacturers to comply with rules and regulations from many sources.
  • Microsoft’s integrated ERP software working with ICM provides a smooth flow of records. It tracks hazardous chemicals, prints GHS labels and generates safety data sheets.
  • Chemical manufacturers concerned about worker safety, protecting the environment and avoiding government penalties will only benefit from the right ERP system.

Explore our Products page to learn about the different ERP Solutions available to jumpstart your evaluation process.

Time to Explore Pharmerging markets
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It’s Time to Explore Pharmerging Markets
It’s Time to Explore Pharmerging Markets 700 500 Xcelpros Team

Introduction

A relatively new term making waves in business is “pharmerging markets.” What does the term mean and why should pharmaceutical manufacturers care? The short version is these markets are expected to grow at a faster rate than the rest of the world.

Add in potentially catastrophic supply chain issues and it’s now a great time to invest in markets closer to where active pharmaceutical ingredients are produced. This includes China, India and those in Southeast Asia.

One definition is, “a group of countries having a low position on the pharmaceutical market, but having a fast pace of growth. Those are China and India and to a lesser extent, Brazil, South Africa and other countries,” IGI Global states.

Imarc adds Russia, Mexico, Indonesia, Turkey and others, placing them into three tiers. China is the lone Tier 1 entry.

Tier II contains:

  • India
  • Brazil
  • Russia
  • South Africa

Tier III pharmerging countries include:

  • Argentina
  • Mexico
  • Poland
  • Ukraine
  • Turkey
  • Saudi Arabia
  • Egypt
  • Algeria
  • Nigeria
  • Thailand
  • Indonesia
  • Pakistan

All of these countries share two important characteristics:

  • They have a per capita gross domestic product (GDP) threshold of $25,000.
  • They saw a spending increase of at least $1 billion from 2012 – 2016, though only part of that was in medicines.

Growth Rates

Figure: 1 Expected Growth Rate of Pharmerging Markets by 2025

Integrating the Purchase Order Process

Key Changes in the Outlook

  1. 1.2020: -1.8% (-$23Billion)
  2. 2.2021: +0.6% above pre-COVID-19 growth; +2.3% above 2020 growth
  3. 3.Current outlook including vaccines +4% over outlook that excludes vaccines due to ~$50-55billion vaccine spending in both 2021 and 2022, later reduced as volume shifts to biennial boosters and price drops over time
  4. 4.Expected budget pressures will emerge from longer-term pressures of sustained pandemic
  5. 5.Vaccine spending declines as biennial boosters and costs decline in endemic phase, followed by overall growth returning to expected levels

The 6-year cumulative delta on 2020-2025 spending excluding Covid-19 vaccines is -$4 billion globally.

Sources: IQVIA Market Prognosis, Sep 2020; IQVIA Institute, Mar 2021

Pharmerging markets are expected to have a combined annual growth rate (CAGR) from 6% -9% through 2025, reaching $1.4 billion by 2024. By comparison:

  • Developed nations will grow at no more than 3%
  • The rest of the world will grow 2% to 5%
  • The overall global growth rate is anticipated to be 3% – 6%
  • The U.S. market will grow no more than 3%, possibly less

Pushing the need for prescription drugs and targeted medical therapies in these countries are aging populations, more public hospitals and a heavier burden caused by chronic disease, Pharmaceutical Processing World states. The result is increased pharmaceutical spending since 2016.

A key note, industry research firm IQVIA states, is this growth excludes spending on Covid-19 vaccines. The cumulative spending on Covid-related vaccines, treatments and related products should hit $154 billion.

Get a consultation to learn more about the essential factors to consider when exploring pharmerging markets.

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Fueling Pharmerging Growth

Access to healthcare has historically been a driving force in the use of medicines within the Tier II and Tier III countries. However, IQVIA sees a slowing trend with volume decline across many markets.

However, China’s use of non-Covid pharmaceuticals is expected to accelerate, especially once the pandemic dies down. Changes in the use of medicines, with demands for new vaccines plus shifts in demand for existing therapies and patient behaviors, will also have an impact on the global pharmaceutical market.

These same countries with lower incomes also have dramatically lower access to medicines. The result is an increased demand, especially in those countries where access to quality healthcare is improving.

Highlights of IQVIA’s report include:

  • The largest aggregate contributors to growth in the next five years are immunology, oncology and neurology.
  • Oncology and immunology are forecast to grow at 9-12% CAGR through 2025.
  • Oncology is expected to add 100 new therapies for migraines and possibly Alzheimer’s and Parkinson’s along with other, rare neurological diseases.

Selling in pharmerging markets may sound like a “no brainer” to some corporations but it comes with a critical catch right now: Covid-related issues have the world’s supply chains on the brink of collapse.

Supply Chain Failure?

In areas that pre-Covid rarely saw more than one or two ships waiting to dock, the Ports of Los Angeles and Long Beach had 72 ships at sea on Oct. 4, 2021, an Oct. 6, 2021 story on CNN.com states.

Before Covid, most ships went straight to a berth. Now? There’s an average 10-day wait to get in, unload and reload.

“It’s like taking 10 lanes of freeway traffic and moving them into five when the cargo gets here to the port,” Gene Seroka, executive director of the Port of Los Angeles, told CNN International on Oct. 5. “We’re having difficulty absorbing all of that cargo into the American supply chain,” CNN states.

Adding to port woes are a lack of truck drivers to move containers along the supply chain into warehouses. Delays in unloading also cause problems with getting empty containers where they are needed. Manufacturer’s can’t send large volumes of goods overseas when they don’t have containers to ship them. It’s either not enough empties or having empties in one port when they are desperately needed in another.

The effects of these supply chain issues are quickly reverberating back to consumers.

“Say hello to your pandemic price increase,” the headline of an Aug. 12, 201 column in SupplyChainDive states.

Gaps in the supply chain cause buyers to look at smaller suppliers to meet raw and unfinished materials demands. The result is procurement professionals are finding new suppliers, sometimes at a better price than their old standbys, the article states.

Now comes the question many pharmaceutical companies need to ask: Can they keep production on schedule even with a uncertain supply chain?

Technology is Part of the Solution

Enterprise Resource Planning products like Microsoft Dynamics 365 and its Supply Chain Management module can help. It makes tracking essential precursor materials pharmaceutical companies much easier. It can track APIs from the time they leave a factory in India to the moment they land in a production warehouse. From there, accurate labeling using barcodes and QR codes lets these companies know where every item, batch, lot and pallet goes.

Other software equipped with artificial intelligence can quickly produce usable supply chain information. When did we order this? Was it delivered in time to meet our needs? Is there someone else closer, either to our production facilities or our customers, that can ensure we meet our contractual obligations?

ERP software can also help forecast not only supply but demand and where that demand might be the greatest. If demand is in a pharmerging market close to where a company gets its raw materials, there might be a justification to build a new facility. Not having to cross oceans will reduce shipping costs and extensive delays.

Final Thoughts

Businesses don’t run in a vacuum. Supply chains that affect cars and consumer goods also impact pharmaceutical companies. Keeping very close track of where raw materials are produced, how long it takes for them to arrive are just as important as the time spent producing finished goods and then shipping them to the customers.

Implementing a solution like Microsoft Dynamics 365 Supply Chain Management goes a long way to removing the guesswork.

Corporate Purchase Order Automation - Best Practices
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Corporate Purchase Order Automation – Best Practices
Corporate Purchase Order Automation – Best Practices 700 500 Xcelpros Team

Introduction

Chemical company purchasing focuses on boosting profits through a simple chain of obtaining required materials and services. In today’s rapidly moving digital world, purchasing requires a comprehensive strategy that can adapt rapidly changing conditions.

Is your company still using manual archaic systems to manage purchase orders? An antiquated purchasing process can easily lead to mismanagement and simple user errors, reducing your profits.

Times, however, have changed. Using a technology-driven approach that automates the entire supply chain and includes real-time supplier collaboration saves time and money. These systems increase efficiency while boosting profitability.

Figure: 1 Integrating the Purchase Order Process

Integrating the Purchase Order Process

Companies using software tools lacking a common design and style, especially those made 3rd-parties, are looking to cause data errors. Having a common suite of tools for daily use that can share information goes a long way to reduce errors and improve efficiency.

For example, connected business solutions from Microsoft help streamline internal processes. They automate repetitive tasks so your people don’t have to.

43%

of companies agreed that there are loopholes in their PO practices.

64%

of organizations reported having plans for addressing purchase order management inefficiencies in the near future.

Source : A survey of Finance Personnel, 2017

Figure: 2 The Purchase Order Lifecycle

The Purchase Order Lifecycle

Procurement and the Purchase Order Life Cycle

Buying raw materials and finished components starts with negotiating terms and then acquiring goods or services from approved vendors. It also requires establishing payment terms and evaluating suppliers based on past transactions. Other steps are sending purchase orders, receiving purchased goods and processing invoices and payments.

The purchase order lifecycle has six core steps:

1.Vendor Selection: After receiving supplier quotations, buyers shortlist the ones meeting company requirements and budgets. While that happens, the procurement team verifies the supplier’s integrity, taking stakeholder input to reach a unified decision on which suppliers to use.

2.Negotiation and PO Dispatch: Buyers and suppliers negotiate the delivery timeline, set on time in full (OTIF) key performance indicators (KPI), establish a payment process, agree on quality standards, dispute resolutions, confidentiality, risks, change in requirements and other details. Suppliers and buyers sign purchase contracts, locking in the price and other terms.

3.Purchase Order Creation: Once the procurement team receives approval on purchase requests, it creates a purchase order containing product details, pricing, delivery terms, freight methods and other details. When dealing with multiple line items, some buyers’ systems may create purchase orders for each item.

4.Receiving goods and quality checks: Vendors send shipments according to the buyer’s instructions and terms in the PO. After receiving the supplier’s shipment, the buyer conducts a standard quality check, confirming it matches the PO’s requirements and packing slip. The receiving clerk verifies the item count is correct and conducts a surface level check for damages, noting any errors or damage. When the shipper and receiver numbers and quality levels do not match, relevant parties are provided details on what was found. After disputes are resolved, the receiver records the receiving information into the inventory management system.

5.Processing invoice payments: The supplier invoices the company, which routes it to the Accounts Payable(AP) Department. An AP clerk inputs the invoice, verifies details and charges against the PO and posts the PO or invoice. The transaction creates an open invoice against the supplier in the system. The open invoice now appears on an aging report.

6.Processing the payment for the purchase: As the invoice due date approaches, an AP clerk prepares a payment proposal that follows a standardized company workflow. Approval typically depends on the invoice amounts with higher figures requiring higher-level executive approvals. After getting approval, another AP clerk prints checks or sends electronic payments before posting the payment and clearing the open invoice.

What do these steps tell modern businesses? Each overly-simplified step shows that being detail oriented is a primary requirement. Anything that reduces human error and improves the overall accuracy of the purchase-to-pay lifecycle must be considered.

Small companies may skip the PO process, relying on strong relationships with only a few vendors. When verbal deals break down into a battle of “he said, she said,” the result is often an unnecessary legal battle. Having an automated written process keeps everything documented, safeguarding your company from potential losses.

Underlying Reasons for a Purchase Order Failure

There are plenty of reasons, including human error or process failure, why a purchase order system can fail. Some of the reasons are:

  • Authorization limitations

    In most cases, only an authorized person should sign a purchase order, obligating the company to pay it. Situations may arise when the authorized agent doesn’t receive the PO or forgets to complete the sign-off. In such cases, Accounts Payable may refuse to accept the invoice.

  • Using wrong codes and supplier names

    The person assigned to complete the purchase may lack crucial details such as the full supplier name and business code. Incomplete or inaccurate forms wastes time and money.

  • Not completing all essential columns and boxes

    When handling POs manually, there are no system reminders to fill in every mandatory data field. Missing data in one field can have a domino effect on other areas.

  • Failing to use the preferred suppliers’ list

    In an automated PO management system, a preferred supplier list is given preference. It forces the buyer to stick to what is listed. Choosing suppliers outside the approved list requires providing an explanation to management, even when the altered decision benefits the company. Automated systems often have a trigger, requiring management approval before the PO progresses. Manual processes are challenged to monitor approved supplier checks.

  • Delivery Delays

    One of the apparent problems faced in manual Purchase order processing is enhanced visibility in delays of goods/ services delivery. Typically, a high volume of orders or errors results in the supply system slowing down or losing track of vendor shipments.

Automation as a Solution

While digitizing purchase orders requires a significant initial investment, it’s a long-term solution resulting in a tangible return on investment. The sooner a company upgrades to automated electronic invoicing solutions through enterprise resource planning (ERP) software, the faster it sees the benefits. Producing electronic POs in an older ERP removes paper but doesn’t end manual processes. Buyers still need to extract the PO from the ERP and email it to the supplier.

Having an automated PO system that easily fits your business requirements makes purchasing more efficient. It should have features such as automatic purchase order creation and approval routing. It should notify suppliers via email or through an alert triggered in an online supplier portal.

When your advanced ERP—like Microsoft Dynamics 365—has an online supplier portal, your vendors can receive purchase orders, make modifications, send order acknowledgments and generate accurate invoices.

Get a Assessment to Begin Your Digital Transformation in Purchase Order Automation.

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5 Steps to Creating an Automated PO System

There are five steps required to create an automated PO system:

  1. 1.Integrating the purchase order system with ERP
  2. 2.Creating an electronic PO requisition and approval process
  3. 3.Transmitting electronic purchase orders to suppliers
  4. 4.Providing suppliers with easy online access to view your POs, acknowledge orders, and send advance shipment notices (ASNs) instantly
  5. 5.Streamlining supplier transactions to help manage your purchase-to-pay process

Key Benefits of Automating Purchase Order Process

Chemical and pharmaceutical companies plus their suppliers gain several benefits from using an automated purchase order system. These benefits include:

Providing suppliers with 360-degree views of orders, invoices and payments

PO requisitions automatically route for approval

Increasing invoice accuracy and reducing duplicate data entry

Saving time and resources while making users more compliant

Minimizing inconsistencies and reducing opportunities for error

Streamlining the entire PO process, promoting faster speed and better efficiency

Enhancing productivity by managing multiple orders simultaneously

Reducing long-term expenses

Streamlining inventory management and improving decision-making capabilities

Figure 3 Upgrading to an Automated PO System

Upgrading to an Automated PO System

Improving Supplier Interactions with Dynamics 365

Dynamics 365 works with Microsoft Office 365 to simplify and automate daily tasks, letting your procurement team focus on managing purchases.

For example: Your buyer receives an email from a supplier requesting additional details on a quote. The system recognizes the sender, enabling the buyer to easily pull up prospect cards within Outlook. From this dashboard, the buyer reviews the account that includes the supplier’s existing quotes, ongoing orders and purchase history. While the buyer manages the quote, supplier and product information auto-populate, helping him get it done faster.

Another example is while your buyer is sending a purchase requisition, a message is sent to their inbox from a potential supplier they recently interacted with at an event. The system recognizes the supplier’s email address is not in the supplier database, prompting the buyer to add it. Without leaving Outlook, the buyer creates a profile in Dynamics 365 Finance.

Both of these examples show how automation reduces time spent on administrative tasks, allowing your purchasing team to quickly respond to quotes and ultimately improving overall customer service.

As a business owner, imagine receiving an email from a high-priority customer needing an order delivered fairly quickly. Fulfilling that order depends on receiving materials from your suppliers. Without leaving your inbox, you can check inventory and discover that you don’t have enough stock on hand to fulfill the order. Your sales team can quickly send a PO directly to the Buyer with “approval to proceed.” In the same interface you create and send a purchase order to the vendor and a quote to your customer.

With Dynamics 365 and Office 365 working together, you can take quick action right from your email – allowing you to spend more time managing your business and connecting with customers.

Key Takeaways

Efficient purchase order automation increases the point of revenue, makes the operational process easier and reduces error rates.

The mature and robust functionality of an automated purchase order system ensures better functioning of the Purchasing department, with a cloud-based procurement solution offering greater transparency on purchase order management with even greater ease of access.

CONTACT US and get started with your Purchase Order automation process using Power package with Microsoft Dynamics 365 Supply Chain!

Challenge of Manufacturing Transformations
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The Challenges of Manufacturing Transformations
The Challenges of Manufacturing Transformations 700 500 Xcelpros Team

Introduction

“Cutthroat and quick.” Those two words sum up the state of the modern manufacturing industry. Customers want the lowest possible prices, abandoning long-term relationships to save money. They also want their products and they want them Now. It makes no difference to some companies that the containers that move their goods are stuck on a freightliner offshore: the client wants their goods this instant.

So how can an older company known for producing quality merchandise compete with the upstarts? The answer is by digitally transforming its operations.

Key parts of this transformation involve:

  • Automation
  • The Internet of Things
  • Using AI (artificial intelligence)
  • Upgraded equipment
  • Enhanced cybersecurity
  • An emphasis on “going green

The good news is each of these challenges can be overcome, leading to a company that is leaner, greener and in terms of the competition, meaner. The bad news is doing it requires planning, forethought and a willingness to disrupt the “we’ve always done it this way” mindset.

There are three key components for a successful digital transformation:

  1. 1.A change champion to push, prod, cajole, criticize and even complain to keep the project moving on track.
  2. 2.A trained consultant, one experienced in performing similar upheavals at other companies in the same or related industries.
  3. 3.A suite of products that can be customized to meet your specific needs.

1.Change Champions Drive Innovation

One of the reasons why some businesses fail when attempting to modernize is mindset: leadership is unwilling to abandon the old ways, not only of doing business, but of thinking. A change champion who has the authority to drive modernization is a key player in bringing any company from the 20th Century into the always-changing 21st.

Often described as “a mono-maniac with a mission,” change champions are the people who ensure new technology gets adopted. They work-hopefully with the support of top management-to drag their company forward.

“A good champion is passionate about their cause or change. They are staunch, zealous, and even fanatic. A great champion is emotional, irrational, irreverent, impatient and unreasonable. They want the change – no matter how big – to happen this week, this month, or certainly by the end of this quarter. To an impassioned change champion, the sky is often falling and the situation is desperately urgent,” Innovation Management states.

Overcoming management inertia is one challenge facing digital transformation in manufacturing. This is critical because AcqNotes looked at several studies and concluded that the failure rate of software projects range between 50 percent – 80 percent.

Causes of failure include:

  • Lack of user participation
  • Changing requirements
  • Unrealistic or unarticulated project goals
  • Poor communication among customers, developers, and users
  • Poor Project Management
  • Stakeholder politics
  • Lack of Stakeholder involvement

Some of the worst software acquisition practices include:

  • Using schedule compression to justify new technology on a time-critical project
  • Expecting to recover more than 10 percent schedule slip without a reduction in delivered functionality
  • Putting items out of project control on the critical path
  • Planning to achieve more than 10 percent improvement from observed past performance
  • Burying as much of the project complexity as possible in the software as opposed to the hardware
  • Conducting critical system engineering tasks without software expertise
  • Believing that formal reviews alone will provide an accurate picture of the project
  • Expecting that the productivity of a formal review is directly proportional to the number of attendees above five

Effective change champions working with top management backing-president, board level and/or owner-can overcome these hurdles.

Change Champions work with consultants experienced in helping manufacturers adopt a digital mindset. Knowledgeable consultants with a good track record for installing well-known, proven enterprise resource planning (ERP) products like Microsoft Dynamics 365 Finance can help change champions in their goal to convince naysayers to the project.

2.Digital Transformation Consultants

Before looking at the role of a consultant, examine one of many definitions for digital transformation.

Figure: 1Digital transformation for manufacturing

Digital transformation for manufacturing

“Digital Transformation is the profound transformation of business and organizational activities, processes, competencies and models to fully leverage the changes and opportunities of a mix of digital technologies and their accelerating impact across society in a strategic and prioritized way, with present and future shifts in mind,” several websites state.

Digital transformation for manufacturing has several important-and ultimately, profitable-benefits.

They include:

  • Greater efficiency through streamlined processes and decisions
  • Improved productivity as automation lets skilled workers spend their time and attention on critical, rather than mundane, tasks
  • Insights letting executives understand why projects failed and how they can succeed the next time
  • Enhanced customer service aimed at a global, 24/7/365 audience
  • Finding competitive advantages where they may not have existed before

Once Change Champions help executives understand what a digital transformation is and what it can do, the next key step is hiring a consultant to help them plot a course. A lack of any plan, or even deviating from the plan is a recipe for disaster.

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A digital transformation consultant’s role is helping an organization understand how it can achieve its medium and long-term goals, ultimately becoming more profitable by using technology to implement strategic changes. Common steps taken by consultants, such as the technology strategists and road mappers, begins with:

  1. 1.Assessing each customer’s current position and its needs.
  2. 2.Developing implementation strategies specific for each client company.
  3. 3.Convincing management and staff that while change is always hard, their lives will be easier and more productive in the long run.
  4. 4.Working with the firm to ensure the implementation meets the company’s goals, offering advice and potential fixes for any roadblocks that appear.
  5. 5.After the implementation is complete, they review what happened. What went right? What didn’t go as planned? How can we learn from any failures in this phase to make the next phase smoother?

3.The Software

Whichever software package suggested by consultants that the company accepts, must be:

  • An industry leader
  • Safe and secure from digital threats
  • Easy for employees to use
  • Expandable when growth occurs
  • Customizable to meet company-specific needs
  • Flexible to meet the needs of a changing world economy, one currently suffering major supply chain disruptions
  • Able to be implemented in stages that allow the company to keep operating during the installation

Microsoft Dynamics 365 checks all of these boxes. Built on Microsoft’s Azure platform, it offers flexibility by having individual modules such as Sales, Finance and Supply Chain Management that can be installed as needed. More than just easy to use, D365 offers a familiar look and feel with most administrative staffers using Office 365. Security is built-in both through extra layers in the Azure platform and in Microsoft’s cloud architecture. D365 is also easily expandable, letting the software expand as the company grows.

The Bottom Line

Overcoming the challenges of a digital transformation in manufacturing requires having a Change Champion with the power to keep the company on track. It requires trained, experienced consultants that help the company understand what it wants to do and how to achieve its medium and long-term goals. And it requires software that can meet a company’s needs today, tomorrow and in the foreseeable future.

REFERENCE:

How to modernize your manufacturing business

Reshaping procurement within pharmaceutical supply chain banner
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Reshaping Procurement within Pharmaceutical Supply Chain
Reshaping Procurement within Pharmaceutical Supply Chain 700 500 Xcelpros Team

Procurement in the Pharmaceutical Industry

The procurement of raw materials in any pharmaceutical company is a source of inventory. An established method to improve visibility, track, and trace product quality is a must-have, regardless if it’s a manual, electronic, or a hybrid purchase-to-pay process. Procurement in the pharmaceutical industry is thoroughly scrutinized, and businesses have become more cautious of raw material and service spending. Many companies are evaluating different suppliers, who can fulfill their requirements at a lower cost, with attention to overall spending and quality requirements.

A robust supply chain management system is needed to:

  • manage on hand inventory, and
  • build a more reliable end-to-end pharmaceutical supply chain.

What are some considerations when revisiting purchasing functions?

This question shines a light on companies’ need to organize their purchasing process, include more visibility for senior management, and increase traceability of purchasing transactions for streamlining the procurement process. A comprehensive supply chain management solution with low-code and customizable workflows to modernize the pharmaceutical procurement process will be an incredibly valuable asset.

Figure: 1Checklists to Turn Your Supply Chain More Efficient

Checklists to Turn Your Supply Chain More Efficient

Businesses can benefit through a supply chain management system with advanced procurement processes to help accomplish the following objectives.

01.Ensure Compliance:

Failure in quality compliance can result in hefty penalties and may jeopardize customer trust, especially when activities, such as buying from approved vendors or segregation of duties between the buyer and invoicer, are compromised. Your procurement management system should provide the ability to perform required audits with controls, and enable only authorized users to perform their appropriate functions. Preferably, a pharmaceutical supply chain management system needs to be in full compliance with 21 CFR part 11.

02.Support Strategic Vision:

Successful life science companies focus on strategic planning and development to boost their bottom line. Any modern supply chain management system should help an organization achieve its strategic goals. Functions like a streamlined buying process are possible with spend analytics, derived from multiple dimensions of purchase transactions. Factors, such as the success rate of higher quality materials from approved suppliers, competitive pricing details, and gauging on time and in full payments from preferred suppliers, are a few key analytics that can help improve decision-making within the purchasing department of the organization to meet their goals.

03.Effective Supplier Relationship Management:

Long-lasting supplier relationships are crucial to procuring higher quality products at the lowest prices. Building a strong relationship with a familiar supplier is far more effective than continually switching vendors to lower costs. Frequently changing suppliers places an additional burden on the entire procurement ecosystem. Suppliers put a lot of effort into understanding your business’ needs over time, including feedback on the quality of raw materials purchased and the speed of shipments delivered, allowing them to make any necessary corrections to their processes. A supply chain management system that supports collaboration in such cases, helps integrate suppliers as partners to add value to the overall supply chain process.

Figure: 2Supplier Relationship Management

Supplier Relationship Management

04.Reduce Operational Costs:

Buyers or purchasing managers should be able to quickly analyze products offered by various suppliers spread across multiple geographical locations in order to secure the best pricing and reduce expenses.

The right kind of solution should eliminate wasteful spending—a critical factor in calculating the performance of any organization.

A detailed view of supplier insights can help make decisions while identifying the best supplier for various materials. Identifying solutions to balance the cost and quality of purchased materials, can help significantly reduce operational overhead without compromising on any KPIs of pharmaceutical procurement. Result-oriented companies in the life science industry should have a well-thought-out method in place to manage procurement functions, allowing them to maintain highly competitive prices without compromising the quality of a lot.

Figure: 3Better tools for modern supply chain management

Better tools for modern supply chain management

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Improving Organizational Efficiency is Your Key Metric:

Streamlining procurement in the supply chain, as well as identifying all possible failure points in your workflows, can significantly improve your organizational efficiency and increase the overall performance of the business. Every organization requires the ability to identify areas of their business that need improvement. Enhancing procurement in the supply chain, directly affects the utilization of materials and labor appropriately without compromising quality or cost. Optimizing resource time and inventory management together, increases efficiency. A well-planned purchasing procedure will make it easier to show incremental results on crucial analytics, such as vendor performance and spending analysis.

The Ideal System

  • helps organizations streamline their pharmaceutical procurement process and get deep visibility into product inventory.
  • easily and quickly identifies product and service needs, and procure products, post receipts, invoices, and payments through included procurement and sourcing management modules.
  • defines purchasing policies and workflows to configure procurement processes that meet your business needs.
  • manages product catalogs and procurement channels based on demand and vendor pricing and capabilities.
  • defines spending limits to constrain requisition spending and the purchasing workflow.
  • protects the privacy of the business and its customers.

Procurement management 2.0—Revamping technology

Any advancement in market dynamics has a direct impact on the buyer’s journey. Because of this, the need for procurement department heads to play a more strategic and tech-enabled role increases significantly. Early life science procurement departments had only two primary objectives: cost reduction and risk mitigation. Now, digital technologies have revolutionized procurement in the supply chain in companies to expand focus into different areas, like efficiency, accessibility, sustainability, and metrics for generating better purchasing decisions.

In the five years immediately following the 2008 global financial crisis (GFC), total return to shareholders (TRS) for companies with top-quartile procurement capabilities was 42 percent higher than for companies whose procurement operations were in the bottom quartile.
Source: Mckinsey

To stay on top, companies must move past the traditional buyer mindset, and deliver value to businesses by keeping their procurement teams collaborative with their suppliers by internally driving productivity and increasing savings, and externally maintaining better supplier relationships, and reducing unnecessary supply chain risks.

As technology continues to advance, we will continue to see new applications giving new life to the pharmaceutical supply chain in order to promote business functions.

01.Cloud-Based Platforms:

Moving procurement to the Cloud enables life science organizations to operate with more agility and with benefits, including enhanced collaboration, security, and data privacy. A growing number of traditional enterprises are already embracing the Cloud’s capabilities to accelerate their businesses. Buyers can be a lot more agile at moving materials through the supply chain if they’re managing procurement functions on the Cloud. Embracing portals and well-defined workflows, allows better engagement with suppliers, allowing the acceleration of tasks like request for quotations (RfQs).

Gartner reports that the procurement industry has an anticipated growth of up to 3.2 billion dollars by the end of 2020, fueling the Cloud procurement sector.

02.Data Analytics:

Adopting an analytically driven approach might not be revolutionary, but it’s certainly an evolution for the pharmaceutical procurement management that we know today. The significant challenges that organizations face today are primarily related to a lack of visibility.

A survey by Deloitte Global CPO showed that analytics would play a significant part in shaping procurement in the supply chain over the next two years. According to the study, the respondents use analytics in different ways:

50%for Cost optimization

45% for Management reporting

48%for process improvement

As procurement departments’ spend vs quality goal is often to exceed expectations for their businesses, turning to integrated analytics can offer innovative solutions to enable efficient resolution of ongoing buyer challenges. For best results, these teams need analytics as a core function in their decision-making process instead of treating it like a checklist submission to management. With the right reporting and analytics, life science companies should have an easy preview of the quality of raw materials per supplier. Categorizing suppliers into the proper buckets, based on supplier evaluation criteria or consuming specific lots based on customer potency/quality requirements, helps make better purchasing decisions.

03.Enhancing Collaboration:

The previous decade has seen a relatively large shift in procurement-based technology, with solutions moving from on premises to completely collaborative Cloud platforms. The initial extension of legacy ERP software systems, which included purchasing modules in the 1990s, has now evolved to easily accessible systems with enhanced collaboration and procure-to-pay solutions.

As businesspeople start exploring the pharmaceutical procurement process further, the focus is moving to niche functions, like strategic sourcing, asset acquisition, and others. These standalone technological products did nothing to solve a significant challenge: collaboration. Integrated tools, such as Microsoft Flow integrated with Microsoft Teams, are providing seamless collaboration between buyers and suppliers.

04. Mobility

With the increasing population of millennials entering the workforce, the demand for mobile devices continues to steadily rise. Deloitte predicts that nearly 42 percent of companies invest in mobile phone technologies to support their procurement strategies, meaning mobile devices should now be considered an integral part of every procurement strategy going forward. With the help of the Cloud and mobile enabled services, companies can better manage their operations and analyze real-time functions and processes, leading to more proactive decision-making.

The Role of Microsoft Dynamics 365 Supply Chain Management

Microsoft Dynamics 365 Supply Chain Management helps organizations streamline their procurement process and get deep visibility into product inventory by:

  • easily and quickly identifying product and service needs and procure products, post receipts, invoices, and payments through included procurement and sourcing management modules.
  • defining purchasing policies and workflows to configure procurement processes that meet your business needs.
  • managing product catalogs and procurement channels based on demand and vendor pricing and capabilities.
  • defining spending limits to constrain requisition spending and the purchasing workflow.

Figure 4 Optimize your supply chain with Dynamics 365

Optimize your supply chain with Dynamics 365

Key Takeaways

  • Modern pharmaceutical and life science companies have digitized their operations and processes within the procurement department to help streamline the buying process.
  • Advanced digital approaches, such as using Microsoft Dynamics 365 Supply Chain Management or automating the pharmaceutical procurement process, can help accomplish the goal of well-stabilized procure-to-pay cycles.
  • A revamp in the Microsoft ecosystem’s overall procurement process enables life science companies to identify and eliminate inefficient, time-intensive aspects.

Process and systems to support the bio-economy banner
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Process and systems to support the Bioeconomy
Process and systems to support the Bioeconomy 700 500 Xcelpros Team

The public benefit gained through biological research can be seen through the eyes of a patient who receives a critical medication that did not exist a decade ago, a farmer whose higher-yield crops are turned into fuels, food, and intermediate chemicals, and a small-business owner whose innovative biobased products are breaking new ground in manufacturing. Increased societal needs for food and energy, combined with new knowledge/discoveries in biology and new methods for harnessing biological processes, have dramatically increased the economic potential of the bioeconomy.The National Bioeconomy Blueprint

Introduction

Though written in 2012, The National Bioeconomy Blueprint contains some information valuable to any company wanting to explore the bioeconomy. Critical elements are investments in research and technology.

“… If we want the next big breakthrough, the next big industry to be an American breakthrough, an American industry, then we can’t sacrifice these investments in research and technology,” then-President Barack Obama says in the report. The White House authored the report.

Government agencies at the time were supporting the bioeconomy by:

  • Identifying research and development (R&D) methods
  • Developing foundational transformative technologies
  • Integrating approaches from engineering, physical sciences and computers
  • Improving predictions of vaccine and drug toxicity and efficacy
  • Identifying and characterizing any microbial organism, including purely synthetic versions
  • Creating “science enclaves” that allow analysis of large, complex datasets while maintaining proprietary information.

The report also wanted American industry to increase investment in and production of biofuels, replacing fossil fuels with biomass systems.

Other tasks cited in the report included converting carbon dioxide into liquid fuels, improving biofuel and energy crops, developing new agricultural research programs that drive job creation and transforming manufacturing through bioinnovation.

Some of these tasks have already shown results.

Recent Biotechnical Innovations

A 2020 post on the Klabtree Blog lists 10 biotech innovations.

One of them is CRISPR-based platforms. An acronym for clustered regularly interspaced short palindromic repeats, CRISPR technology was used to create the Pfizer-BioNtech and Moderna Covid-19 vaccines. Other medicines are also using the same technology.

The CRISPR tool, “is based on a system that bacteria use to fight viruses. Bacteria develop clustered repeated sequences in their DNA, known as CRISPRs, that can remember dangerous viruses and then deploy RNA-guided scissors to destroy them,” an article in Time magazine states.

Unlike a DNA-based product that targets a cell’s nucleus, messenger RNA (mRNA)-based vaccines just need to get into the more accessible outer regions of cells where proteins are built.

Using CRISPR technology to accomplish this task, both companies were able to produce Covid-19 vaccines that meet FDA emergency standards. The Pfizer-BioNTech vaccine, now known as Comirnaty, uses its regular, non-emergency procedures. The “regular” and “emergency” variations share the same formula, the FDA states.

Another technological innovation cited by KolabTree that is still being developed involves using DNA as a computer hard drive. The concept would turn cells into data storage chambers with the not-yet-realized ability to store information similar to current data storage.

A third innovation is using base pairings of DNA and RNA nucleotides in what is known as “DNA origami” after the Japanese paper folding art form. Nanovery is using this technology to create diagnostic nanorobots. The robots are inserted into a blood sample. When cancerous DNA is found, the robots light up.

Bioeconomy Business Strategies

Having the technology to turn biological products such as corn husks into fuel does not generate money. Having people who can see profits in the bioeconomy does.

“Entrepreneurs can contribute to the (bioeconomy transformation) by commercializing innovative technologies through startups and new business models,” Andreas Kuckertz writes in a white paper published through MDPI.com.

Figue: 1Bioeconomy Business Strategies

Bioeconomy Business Strategies

Using his research, key strategies for the United States mentioned by the author include:

  • Regulatory framework: Creation of tax breaks, reducing regulatory barriers and helping entrepreneurs obtain and defend patents
  • Market Conditions: Use the public procurement process to speed market adoption
  • Access to Finance: Support the bioeconomy by using venture capital for startups
  • Knowledge Creation and Diffusion: Educate entrepreneurs, connect them to mentors and educate government agencies about entrepreneurship
  • Entrepreneurial Capabilities: Enhance university entrepreneurship
  • Culture: Create an overview of available prizes and awards (mentioned in the National Bioeconomy Blueprint)

Kuckertz suggests modifying these strategies to include those that are:

  • Holistic and based on a clear, causal rationale
  • Include policies with measures tied to clear key performance indicators (KPIs) that can measure progress
  • Have, “dedicated innovation programs accounting for the specifics of bioeconomic innovation will be required to recognize the potential of many promising and possibly game-changing entrepreneurial initiatives.”

While Kuckertz’s comments are oriented at new business development, these same strategies can be used by existing companies. One way is by taking advantage of current cutting-edge business technology: Enterprise Resource Planning (ERP) software.

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Common Themes in Bioeconomy Products

Each of the previous technological innovations has at least three common themes:

  1. 1.Collecting massive quantities of data, also known as “big data.”
  2. 2.Analyzing it and making sense of what is found. Researchers can pour over spreadsheets and try to understand the data or they can use software. Machine learning (ML) and artificial intelligence software helps find the nuggets. These are the test samples that show a formula’s promise while also listing all of the others that don’t.
  3. 3.Safely storing this information away from prying eyes and competitors.

The good news for many companies is the technology to accomplish these three tasks exists today.

The industrial internet of things (IIoT) lets companies gather big data. ERP software is adept at many tasks, one of which is using artificial intelligence (AI) to provide business insights.

Cloud data storage is generally considered to be more secure than that on many small and medium business (SMB) internal networks, using the Microsoft Azure platform to run Windows-based products, adding extra layers of security and reliability.

Microsoft Dynamics 365 AI is designed to help businesses gather insights into customer needs and experiences. It helps companies accelerate a single process and lets groups solve problems and make decisions based on the data.

Microsoft Azure’s cloud computing service provides a stronger, safer and much more resilient computing platform than the average SMB network. It also has the advantage of making data easily accessible from anywhere in the world, all without compromising data security.

The Bottom Line

The bioeconomy is slowly making inroads into various industries. The chemical and pharmaceutical fields are perfectly set-up to take advantage of reusable biological materials such as corn husks for fuel. Other materials can be used to produce less toxic plant-based solvents.

Making money from the bioeconomy requires not only forward-thinking investors who care about the environment, but also advanced technology like Microsoft Dynamics 365 to make sense of it all.

REFERENCE:

Top 10 Biotech Innovations you should know about

supply chain disruption management
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How to Manage Operations During Supply Chain Disruptions
How to Manage Operations During Supply Chain Disruptions 700 500 Xcelpros Team

Introduction

Even today, Covid-19 continues to disrupt every level in supply chains, across every industry around the world. The lasting effects on supply chains was unanticipated, especially concerning food and cleaning supplies. Manufacturers in those areas had an unexpected spike in demand that couldn’t be managed quickly.

The overall supply chain disruption caused many companies to start re-evaluating action plans. Areas being closely examined today include production capacity, cash flow and overall employee morale.

Let’s look at how businesses can leverage existing practices while pivoting to newer methods and meeting evolving customer needs.

Figure: 1Surviving the Supply Chain with a Digital and Analytical Backbone

Surviving the Supply Chain with a Digital and Analytical Backbone

Communication and Collaboration

The first quarter of 2020 brought new dynamics to manufacturers and distributors everywhere, faced with a challenge the likes of which have never been seen before. As market dynamics changed, internal communication became critical at every stakeholder level: management, employees, customers, suppliers and vendors. Creating a communication strategy that could work when people stopped meeting face to face became vital to avoid business breakdowns and shutdowns.

That was 2020. The lingering effects of Covid-19 are still impacting some companies’ technology roadmap plans. However, there are ways to drive innovation and growth. Regardless of industry, many organizations realize the importance of doing business from anywhere. That flexibility to work on the move is no longer a luxury: it is a necessity. Unconventional work schedules are becoming more common as companies adjust to meet customer expectations. Companies are engaging them with messaging and video call software such as Microsoft Teams. They use software such as Power Automate to deploy safety alert messages whenever the need arises.

Customer and vendor portals equipped with Microsoft Dynamics 365 Supply Chain Management let companies collaborate, determine product access and make accurate forecasts without having to pick up the phone. Instead of days or weeks of delays, modern software helps firms resolve supply chain disruptions at a moment’s notice.

Manufacturers using Microsoft Dynamics 365 Supply Chain Management can integrate Internet of Things (IoT)-enabled devices and robots into their current operations. Using machine learning adds even more automation.

Connecting data and processes with Microsoft’s wide selection of products allows production and maintenance teams to schedule downtime when it has the least impact on production. Outlook messages and alerts let production staff stay on top of any possible repair issues.

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Agile decision making

Manufacturers must respond to the rapid changes in customer demands and delivery expectations. Having a robust system lets that happen.

Changes to your customers’ business demands can affect your supply chain. Having the ability to act quickly while still providing exceptional customer service is critical to future business success.

One way to prepare for these changes is by having internal cross-functional teams practice scenario planning. For example, they can plan what to do if a new Covid-19 variant appears and governments reinstate drastic safety measures.

Scenario planning lets your staff learn what to do when normal deliveries are delayed or rerouted, such as what happened when the Suez Canal was blocked for a week. It lets your staff examine past customer and supplier behaviors and come up with plans to minimize disruptions using what they learned.

Microsoft Dynamics 365 Supply Chain Management includes tools designed specifically for scenario planning. It helps companies adjust to unexpected changes in their supply chains. These tools include:

  • Drag and drop Gantt charts for production scheduling
  • 360 degree view into capacity, identifying bottlenecks in terms of people and resources
  • Adjusting safety stock to reflect real-time demands instead of fixed quantities
  • A vendor portal with approved suppliers listed in a supplier resource management database that includes purchase order controls
  • Visibility into warehouse operations for single and multi-site facilities
  • Transportation management
  • A customer portal with sales order management

Incorporating Data

Data in today’s operations is a moving target. Making decisions and providing insights with real-time information helps companies operate efficiently, letting them grow and scale at the right times. Identifying organizational segments that require optimizing, like the handoffs between operations and finance, can only occur when accurate information is available.

For example, the only way to truly analyze cash flow—to get a 360-degree view—is by looking at data within each division.

This is where a business analysis tool like Power BI becomes an essential part of the process. Power BI dashboards using predictive analytics in the Dynamics 365 environment automatically update with the latest data. These dashboards let companies monitor the status of multiple locations at once, saving time.

Tools such as Power BI let management share data, communicate and respond to changes in the market within minutes, not days.

Final thoughts

The coronavirus is the first disruption of its kind faced by this generation. Companies were caught unprepared, being forced to adjust almost instantly to upheavals in their supply chains. Having the right tools in place to deal with Reduced workforces internally and within the supply chain, pivoting production to new products and unprecedented customer product demand helps determine who flourishes and who fails.

With that in mind, it’s critical to consider implementing products from Microsoft’s family of partner solutions. Dynamics 365 and related products help companies predict and manage their operations transparently.

References: Why the Pandemic Has Disrupted Supply Chains (whitehouse.gov)

How Sustainable Operations Helps Manufacturers Grow
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How Sustainable Operations Helps Manufacturers Grow
How Sustainable Operations Helps Manufacturers Grow 700 500 Xcelpros Team

Introduction

Every business leader has heard the term “sustainable manufacturing,” but not all know that practicing methods that help the environment can also grow their business.

“Sustainable manufacturing is the creation of manufactured products through economically-sound processes that minimize negative environmental impacts while conserving energy and natural resources,” the United States Environmental Protection Agency states. These same practices enhance employee, community and product safety in part by producing less waste that pollutes the air, water and soil.

According to the EPA, companies that use a methodical, planned approach to sustainable manufacturing processes:

  • Increase operational efficiency by reducing costs and waste
  • Respond to or reach new customers and increase competitive advantage
  • Protect and strengthen brand and reputation and build public trust
  • Build long-term business viability and success
  • Respond to regulatory constraints and opportunities

Fostering Growth

These environmentally friendly sustainable manufacturing practices help companies grow by reducing production costs long term. For example, instead of paying thousands of dollars each month to an electric company to light and cool a 300,000 square-foot manufacturing plant, consider covering a flat roof with efficient solar panels.

The average payback time for a home solar electric installation (industrial estimates were not available) is roughly 6-10 years, though it varies depending on the climate and other factors. Solar panels also tend to last 25-40 years meaning roughly three-quarters of their useful lives is spent generating free electricity. The most recent designs are much more efficient, producing more power in a smaller size, than those made 10 years ago. The result is greater efficiency, allowing manufacturing facilities to cover less of their roofs while producing as much or more power than the older models.

Production plants can also reduce their massive electrical bills with skylights. The waterproof domed coverings help illuminate work areas, reducing the need of electric lighting. Extended exterior shelves can reduce sunlight, cutting cooling costs.

Figure: 1 Sustainable Manufacturing – a Big Picture

Sustainable Manufacturing - a Big Picture

Turning Trash Into Treasure

Other sustainable methods look at ways to reduce waste, especially by converting some “trash” into new products or using it for new methods.

One website alone lists 35 artful ways homeowners can recycle wooden pallets. These new uses include making tables, bed frames, stairs, mounting frames for heavy electronic display monitors and a host of other uses. Many of these same methods work for industrial companies in terms of outfitting conference rooms and other non-work areas.

From an industrial perspective, worn pallets can be repaired, cleaned and reused. They can also be sold, recouping some of the cost. Other uses for worn pallets include chipping them, turning them into wood pellets. The pellets can then be burned, generating heat and electricity.

Get a consultation to discover more about building sustainable operations for your manufacturing company.

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Cascading Chemicals

Recycling is a large part of the sustainable “green” economy. Industrial chemicals can be recycled. They can also be reused through a process known as “industrial symbiosis,” greenbiz.com states. One example cited uses ferric chloride, which is a byproduct of steel pickling in hydrochloric acid, to treat water.

“Frequently, recycled chemicals are not only cheaper than newly produced ones, but they also reduce resource consumption, waste generation and greenhouse gas emissions. The carbon emissions through solvent recycling are 46 percent – 92 percent lower than those of new solvent production,” the website states.

When the article was written in 2019, industrial giants Siemens and Evonik were conducting research to convert the most common greenhouse gas—carbon dioxide (CO2)—into common industrial chemicals such as ethylene.

Other methods used to reduce chemical and industrial waste cited by greenbiz include swapping what might be one manufacturer’s trash with a different nearby business. That business can use these materials in its products.

Another environmentally friendly industrial method is “leasing” chemicals. In this model, a manufacturer sells the functions performed by the chemical using functional units, not the chemicals themselves.

Large manufacturers with their own wastewater treatment plants can redesign those facilities in ways that help the company turn a profit and grow. Companies interested in practicing sustainable manufacturing practices can modify existing equipment to produce energy, clean water and chemicals because, “the future of sewage is power and profits.”

The greenbiz.com article ends with a quote made in 1848 by the former president of the London Royal College of Chemistry, R.W. Hoffmann: “In an ideal chemical factory there is, strictly speaking, no waste but only products. The better a real factory makes use of its waste, the closer it gets to its ideal, the bigger is the profit.”

Technology Can Spot Opportunities

One way a company can practice sustainable operations management is by using its data wisely. Especially in forward-thinking firms that use internet of things (IoT)-enabled devices, they have access to mountains of information.

Combining a well-thought plan with the right software lets these firms look at everything coming into their warehouse—including packaging—as potential profit sources. Enterprise resource planning (ERP) products such as Microsoft Dynamics 365 and its Supply Chain Management Module let companies of any size keep accurate track of their inventories. Add in the Integrated Chemical Management component and chemical manufacturers have an accurate label management solution that also produces safety data sheets.

By understanding the chemicals involved and working with sustainability experts, plant managers can evaluate their current conditions.

Executives interested in sustainable production and consumption—and being more competitive—will want to ask questions similar to these: What current waste products and materials can we use for secondary purposes or repackage and sell to someone in a different industry? Can we reuse packing materials we receive to pad and protect outgoing shipments? Are we using our raw materials effectively or are there ways we can become more efficient? How much power do our plants use? Are there affordable ways of reducing that consumption while also generating some of our own power all while meeting our long-term business goals?

Asking questions like these, and then using powerful software to find the answers, help innovative firms generate more money. That in turn can use sustainable practices to fuel growth.

The Bottom Line

Sustainable manufacturing involves looking at everything a company has, from a different angle. More office employees are working from home, freeing up space. Can we use that space for a different purpose instead of looking at empty desks? Can we move items around and expand our production facilities or our warehouse without having to build or buy new facilities?

Operations managers wanting to fuel growth by reducing power consumption can use ERP software to find ways to save money and new ways to make money. All it takes is a little outside the box long-range thinking.

Innovation is Helping Chemical Companies Grow Into Giants
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Innovation is Helping Chemical Companies Grow Into Giants
Innovation is Helping Chemical Companies Grow Into Giants 700 500 Xcelpros Team

Introduction

Innovation in business often means introducing something new. It’s common for companies to introduce new ways of looking at how they operate. They take a new and different view of their supply chain. They gather ideas from employees on ways to boost sales. Benefits of innovation include:

  • Boosting productivity
  • Reducing costs
  • Being more competitive
  • Boosting brand value
  • Establishing new partners and business relationships
  • Improving profitability

There are many ways to help companies grow. Using newer digital technology is one method.

Companies that fail to innovate, preferring to use methods that were successful 10 or 20 years ago, can quickly fall behind those seeking to enhance their business. Companies that fail to innovate can expect to:

  • Lose market share
  • Reduce productivity
  • Become less efficient
  • See key staff members leave
  • Watch as margins and profits shrink

From a marketing perspective, the expression “building a better mousetrap” applies to them. This failure to innovate is not a good idea when your customers want medicines that will help them live longer, healthier, happier lives.

By the Numbers

Capital spending in the chemical industry is expected to increase in 2021 and 2022 after a sharp drop in 2020.

  • -17.6%: 2020 chemical industry capital spending
  • +11.9%: 2021 chemical industry spending is expected to reach $30.6 billion this year
  • +3.7%: 2022’s estimated increased in chemical industry capital spending

Is your company willing to invest in its growth?

Figure: 1Chemical Industry Growth Projection

Chemical Industry Growth Projection

Using Technology for Growth

Combining big data with artificial intelligence, such as that built into Microsoft Dynamics 365, helps turn digital innovation in the chemical industry into growth.

Growth happens faster when a company has data from reliable automatic sensors, not manually prepared spreadsheets. After analyzing the data for specific information, company leaders can create and adapt growth strategies.

A 2018 Connected Small Businesses in the United States report by Deloitte found, “relative to businesses that have low levels of digital engagement, digitally advanced small businesses realized significant benefits.” These benefits include:

  • Generating twice as much revenue per employee
  • Up to four times growth over previous year revenue
  • Being nearly three times as likely to create new jobs over the previous year with an employment growth rate more than six times as high
  • Being three times more like to have exported products in the past year

“Despite these potential gains, 80 percent of US small businesses aren’t taking full advantage of digital tools such as data analytics and more sophisticated online tools,” Deloitte stated.

Innovation is a Process

Another term for innovation is change. Effective change—effective innovation—requires planning. Look at the marketplace: What are the giant companies in your market doing? How did they grow? What innovations did they take?

Look within your company and identify opportunities for innovation. Consider using the Industrial Internet of Things (IIoT) to connect laboratory and production devices.

Analyze the competition and then compare what the top companies are doing to how yours operates. What are some of the market trends—using enterprise resource planning (ERP) software is one—that can help your company get ahead of the competition?

Evaluate the business climate. In the chemical industry, this means studying regulations such as those from the U.S. Food and Drug Administration (FDA).

Look at your customers and end consumers. Talk to them. Ask them what kinds of products they want. What does your research forecast will be in demand in five years? In ten years? Is your company positioned to supply those innovative medicines now? Will it be able to meet expected demands when they occur?

Note: See this infographic for a brief look at Organizational Change Management as it applies to upgrading to a modern ERP.

Digital tools are key elements in the new technologies fueling chemical industry growth.

Get a consultation to know how innovation can help your chemical company grow.

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Digital Tools for Innovation

Five key tools are sparking digital innovation in the chemical industry:

  1. 1.The Industrial Internet of Things (IIoT)
  2. 2.Big Data Analytics
  3. 3.Mobile Solutions
  4. 4.Cloud Storage
  5. 5.Cybersecurity

Sensors that observe, record and transmit data in real time are available. Using them lets chemical industry leaders understand how their machines and staff are performing. When those sensors are connected to the internal network and then to the Internet, that data becomes available to anyone, anywhere at any time. For example, a production run in China can be monitored by workers in Chicago.

IIoT sensors create a lot of data leading to the term “big data.” Having a lot of numbers showing production runs and quality levels does not help a chemical or pharmaceutical company grow. Analyzing the data to find nuggets of useful information shows where improvements can occur. Having computer software that examines the data and tells executives what it means can help them spot trends that, when corrected, lead to more efficient operations.

Accessing that data and those trends is one thing when it happens in an office. Getting an alert on the production shop floor, though, can save an expensive batch of product. For example, being notified that an ingredient is running low or a machine will overheat can let workers using mobile devices fix these issues. They can resolve these issues before they become expensive problems.

Even though production floor employees are monitoring machines, their IIoT sensors are still producing large quantities of data. The sheer data volume may easily overwhelm a local computer network. Having a cloud computing connection eliminates that storage issue.

Using banks of interconnected servers, cloud service providers store data securely. Cloud service providers can transfer data from one warehouse-sized server farm to another storage location. They have the highly-trained staff and equipment needed to protect your data from hackers.

One security method not used by many small and medium businesses is Microsoft’s Azure industrial platform. It has its own in-depth methods of keeping your secrets safe from the competition.

Using these technological innovations effectively requires a platform and a team who understands what they want: an ERP installed by an experienced company.

Use a Systems Integrator with industry and transformation experience

A Microsoft Direct Cloud Solutions Provider (CSP), Systems Integrator (SI) and Microsoft Certified Partner for Microsoft System Dynamics. Dynamics 365 with ERP implementation skills, and an ERP that integrates, is scalable and provides accurate insights, together can move a company in the right direction.

Using Microsoft Dynamics 365 products such as Finance and Supply Chain or Business Central, The right technology can help turn SMBs into giants. Or an industry solution, in particular, is aimed at the chemical industry such as Integrated Chemical Management. ICM and other scalable Microsoft products let firms take advantage of digital products.

Having the right subject matter experts who are adept at helping companies transition from legacy ERPs and silo-based systems also makes the transformation simpler. At the end of the day a modern digital platform helps move your workforce into a productive and efficient environment.

Summary

Small companies wanting to grow into giants should waste no time taking advantage of modern technology. Recent innovations such as IIoT, AI, cloud computing and updated ERPs let forward-thinking companies move seamlessly into the future. These organizations are able to move ahead while competitors using siloed systems are left in the dust.

Xcelpros specializes in deploying these on-premise, cloud and mobility solutions. For more information contact us!

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