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warehouse management techniques
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Warehouse management techniques : Tips to increase efficiency
Warehouse management techniques : Tips to increase efficiency 700 500 Xcelpros Team

Introduction

Pharmaceutical and chemical manufacturing companies face greater risks when it comes to inventory control than some other industries. Why? Because some of the same chemicals used to make effective medicines can also create addictive street drugs. For example, ephedrine, which is used to treat breathing problems, is also an active ingredient in methamphetamine. The Food and Drug Administration has strict rules for companies making and distributing drugs. All companies, especially those in the pharmaceutical sector, want to run their warehouses efficiently. Common efficient warehouse management includes:

  • Maximizing and optimizing all available space
  • Keeping inventory to lean levels
  • 50% of enterprises spend more than $1.2 million each year on cloud services
  • Using inventory tracking technology efficiently
  • Organizing the workforce so its time is used wisely

Warehouse management best practices also emphasize the “3 C’s”: control, coordination and communication. Standard practices, where control is maintained by only one department, usually results in difficult coordination and communication between departments such as sales and finance.

Enterprise resource management (ERP) software with warehouse management and inventory control modules can help manage warehouse inventory.

Maximizing Warehouse Space

Maximizing warehouse space includes stacking items logically, and using vertical space to your advantage.

The Centers for Disease Control (CDC) suggests hazardous chemicals be labeled with hazard warnings and the chemical name. Other chemical storage tips from the CDC include:

  • Keeping all stored chemicals, especially flammable liquids, away from direct sunlight and heat.
  • Keeping like chemicals together and away from those that might cause a reaction if mixed.
  • Storing liquids in unbreakable or double-contained packaging.
  • Storing flammable materials, acids and highly toxic or controlled materials in dedicated cabinets designed for those purposes.
  • Storing volatile and odorous chemicals in a ventilated cabinet.
  • Keeping all unused or empty compressed gas cylinders in a dedicated storage area.

Figure: 1Maximizing Warehouse Space

ERPs and Inventory Management Techniques

Use ERP to Run Lean

ERP software often includes warehouse management tools and technology designed to help companies balance inventories with current and future needs.

For example, warehouse management is integrated into Microsoft Dynamics 365’s Supply Chain Management. There’s even a connected Warehousing app available on the Google Play Store and Windows store that connects cellphones and other mobile devices to the network running D365’s Supply Chain Management. Each device must have its own copy of the app and be configured to connect to the local warehouse computer network.

Microsoft’s warehouse management module apps let workers use their cellphones, tablets or other connected devices to perform activities such as:

  • Printing and reprinting labels
  • Generating license plate numbers, confirming item types and quantities on a license plate or pallet and splitting full license plates
  • Starting production orders
  • Get information about particular items in a location

These warehouse management software settings can be configured to allow users different permissions in different warehouse locations. Software such as Microsoft Intune is used to mass deploy settings and service warehouse mobile devices.

Once devices are configured, cellphone cameras can be used to scan many common barcodes, including QR codes.

Another important part of the warehouse management module is the Transportation Management function. It lets workers register when a driver arrives, noting the driver’s name and license number, tractor and trailer number plus the location in the warehouse (e.g., Receiving Bay 1, Shipping Bay 3, etc.).

A key function for the pharmaceutical industry is setting work audit templates to interrupt an inbound order. Since many medicines require strict environmental controls, workers can be prompted through the audit template to check the temperature in delivery containers. They can then be told to check a particular container at a particular point in the receiving process.

Another method of boosting efficiency and controlling warehouse inventory is by requiring warehouse workers to confirm the product, location or quantity when they pick items. This reduces the likelihood of inventory errors caused by inaccurate counts.

Improving Efficiency With an ERP

When IDC conducted its 2018 survey, 45% of independent service vendor customers preferred the lift and shift cloud migration method for moving business applications. Combined with cloud computing, 69% of end customers understand the positive implications of using cloud-based software. These include agility, scalability, cost effectiveness, efficiency and others.

Is Cloud Computing Worth the Cost?

One reason many companies purchase an ERP is its ability to help them run their day to day operations more efficiently. One example is the ability to use an intelligent warehouse management system to cluster purchase order putaways. Workers put away products in a specific area and then pick multiple license plates at once before putting them away in different locations.

In a related activity, workers can check incoming product quality before technically receiving it and taking ownership of it. D365’s Warehouse Management module lets users log these checks with mobile devices.

This same intelligent warehouse management system also lets pharmaceutical companies efficiently process purchase order returns. The item is entered into Supply Chain Management and then scanned, starting the process. Items being returned are picked and sent through the warehouse process using mobile devices. The software also creates the shipment and load.

Similar configuration settings help inventory, procurement and delivery management become more efficient. Workers are no longer moving randomly from place to place within a warehouse, picking items from six different locations for a single order. Instead, they might pick items for six different license plates from the same general location, move to a second spot and add additional items. By using this method, each worker’s time is used to maximize the amount of actual work done, achieving more production.

ERPs and Inventory Management Techniques

Six of the most common inventory management techniques are:

  • Bulk shipments
  • ABC Inventory Management
  • Backorders
  • Just in Time (JIT) shipping
  • Consignments
  • Cycle counting

An innovative warehouse management system helps executives decide when buying in bulk is appropriate and when going lean is better. How? By sharing data with sales, finance and other departments. Warehouse managers can see what sales are coming up and know what raw materials to order.

The same situation applies to deciding what to produce and what to have in inventory based on importance. Data shared between systems lets managers make and adjust these calculations.

Backorders are becoming more common as Covid-19 related issues delay raw material shipments. While using them is a common warehouse management technique, effective ERP software helps firms control backorders and order materials from alternate suppliers.

Just In Time (JIT) inventory management reduces the amount of stock available at any given time to the bare minimum. Using D365 Supply Chain Management lets chief executive officers understand the complete supply chain. They can decide what items to get only when needed and what to buy in bulk.

Combined with precise inventory tracking to know when a specific medication is approaching its expiration date, pharmaceutical manufacturers can use consignment selling with confidence. Alerts will let them know when they need to refresh a seller’s stock.

Cycle counting, where workers count only a small quantity of product, is rendered nearly obsolete by an ERP. Using barcodes and electronic scanners, warehouse managers have an accurate idea of inventory at all times.

The Future of Warehouse Management

The future of warehouse management systems isn’t workers running around with pencils and clipboards. Instead, it’s automating many manual processes with real-time access to critical data.

“Warehouses will be built on current effective process-driven technologies such as widespread supply chain automation, hyper-effective robotic technologies and yes, plenty of drones to go around,” 6 River Systems predicts.

Leading that charge will be artificial intelligence-enabled ERP software coupled with industrial internet of things (IIoT) sensors. This combination will enable pharmaceutical companies to more efficiently track materials as they run their businesses.

Minimize redundancy and maximize your warehouse productivity. Book a consultation to learn how.

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Making Pharmaceutical Supply Chains More Resilient
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Making Pharmaceutical Supply Chains More Resilient
Making Pharmaceutical Supply Chains More Resilient 700 500 Xcelpros Team

Making Pharmaceutical Supply Chains More Resilient

Pandemics, natural disasters, cyber-attacks, political turmoil, and other actions are beyond any company’s control. Any one or combination of these can thoroughly disrupt a smoothly running supply chain. Before making changes to their current supply chain, however, there are some critical points that CFOs, chief technology officers, and other executives should be aware of. For more information see the full article here.

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Migrating to the cloud through lift and shift
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Migrating to the cloud through lift and shift
Migrating to the cloud through lift and shift 700 500 Xcelpros Team

Introduction

Most businesses had never heard of cloud computing before Google CEO Eric Schmidt introduced the term on Aug. 9, 2006 even though it originated in the 1960s. During an industry conference, Schmidt was talking about the potential of network-based computing. “It starts with the premise that the data services and architecture should be on servers. We call it cloud computing,” Schmidt said.

Now, more than 15 years after the term “cloud computing” was born, the numbers show its effectiveness. A report from Hostingtribunal states:

  • 94% of enterprises (i.e., companies with more than 1,000 employees) are already using a cloud service
  • 66% of enterprises already have a central cloud team or cloud center of excellence
  • 50% of enterprises spend more than $1.2 million each year on cloud services
  • 30% of all IT budgets went to cloud computing in 2018
  • By 2025, data stored in cloud centers is expected to top 100 zettabytes (i.e., 100 trillion gigabytes)

A majority of these end-users prefer to “lift and shift” their applications into dispersed cloud server banks. Lift and shift gained prominence in the early days of cloud computing when organizations used this approach to shadow on-premise applications into the cloud.

Lift and shift is a common and simple first step toward embracing the power of cloud.

In simple terms, lift and shift means moving an application without changing the workload framework or software architecture from the existing hardware and operating system when it moves to the cloud. It is essentially rehosting your software on someone else’s distributed computing network. This approach helps companies save time, money and resources required to redesign the applications.

In this article we will touch upon the merits of the lift and shift approach and in the process find out whether moving to the cloud is worth it?

Advantages of Using Lift and Shift

The lift and shift approach is designed to help companies wanting to explore cloud computing without replacing their current software. This method is cost effective, rapid and has higher acceptance from its users because the functionality of the application remains the same.

Advantages of the lift and shift approach include:

  • Application familiarity – Moving an existing application to the cloud means the functioning and usability of the application to end users does not change.
  • Low migration costs – The program is not modified, eliminating the need and cost of rearchitecting the application.
  • Faster deployment – Since there is no need to rebuild the application, speed of delivery is higher compared to building an app from scratch.

For example, consider a Plant Manager in charge of Production Scheduling. This person has a lot to do. They need to maximize their productivity. When the company is expanding and needs to scale up its software, some form of cloud computing—public, hybrid, private or multi-cloud—is the more efficient method than doing it on-site. Replacing an existing program with a newer, unfamiliar one is likely to be met with resistance from staff unwilling to learn new methods of performing the same tasks.

Lifting a familiar program from in-house computers and shifting it to remote servers reduces the fear of change while balancing the need for agility and scalability. According to a 2018 study by IDC, 66% of the end users preferred to lift and shift their production scheduling application to the cloud for higher efficiency compared to 33% who favored keeping it on-premise.

Figure: 1Independent Software Vendors (ISVs) perceive lift and shift.

Independent Software Vendors (ISVs) perceive lift and shift.

How do Independent Software Vendors (ISVs) perceive lift and shift?

When IDC conducted its 2018 survey, 45% of independent service vendor customers preferred the lift and shift cloud migration method for moving business applications. Combined with cloud computing, 69% of end customers understand the positive implications of using cloud-based software. These include agility, scalability, cost effectiveness, efficiency and others.

Is Cloud Computing Worth the Cost?

The most important reason to move company software to the cloud, even at an initial infrastructure as a service (IaaS) level, is cost reduction. Companies save money by lowering hardware maintenance for servers, adding computing power and virtual machines plus the expense of managing the infrastructure on-site.

Using managed services can significantly lower a company’s operating costs, directly impacting its bottom line.

In terms of actual savings, the combined benefit of minimal hardware support, higher efficiency, better manageability of resources could result in a 20 – 30 % average savings on virtual machine (VM) resource configuration alone.

Upgrading an existing application on the cloud provides an integrated platform. Other resources—such as Microsoft’s ecosystem—can be leveraged, adding agility and improving speed by up to 33%. Savings can be much higher.

For example, a multinational insurer was able to save 80% on the cost of a specific development testing environment in an application suite by lifting and shifting it to the cloud. Achieving similar results demands meticulous planning and the ability to gauge savings beyond dollar value. The wider definition of savings must also include intangibles such as the value of time and money from the faster rollout of products enabled by new cloud-enabled capabilities.

Why Microsoft Azure is best suited to lift and shift your applications

There are many cloud computing platforms to choose from. Organizations looking to adopt a cloud model need to ensure everything works correctly after the move. This means interdependencies that exists between applications, data in the system and the workload continue to function even though they are now remote.

Microsoft has a transparent lift and shift process that give you a heads-up on the cost estimates before a company makes the decision to migrate. Microsoft offers a cost calculator that assesses all dependencies and variables involved in the lift and shift process. It helps better assess the migration from a complexity and cost perspective. After analyzing your requirements and determining the effort involved in the lift and shift process, the calculator determines the cost and sequence required in migrating to Azure.

Microsoft’s Azure Migrate can help plan your cloud migration with ease, ensuring you are on top of every move. The service details the mechanisms involved in the process. It provides guidance and insights to smooth your cloud journey.

Benefits of using Azure Migrate include:

  • Discovery and assessing on-premises virtual machines
  • Inbuilt dependency mapping for high-confidence discovery of multi-tier applications
  • Intelligent right sizing to Azure virtual machines
  • Compatibility reporting with guidelines for remediating potential issues
  • Integration with Azure Database Management Service for database discovery and migration

With Azure Migrate, you can be assured that your workload and application will smoothly be lifted and shifted to the cloud without any adverse impact on the business. With the right guidance and tools from Microsoft, the ROI can be maximized, while your application performs seamlessly with the highest security and reliability.

Summary

Companies unwilling to make wholesale changes to their computer software environment can still take advantage of many cloud computing benefits: they can move their existing programs to the cloud using the lift and shift method. Working with Azure Migrate allows the software and data to move with minimal impact on daily operations.

Book a assessment to know more about Azure lift and shift cloud migration abilities.

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Cybersecurity improving Data Security
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Cybersecurity: Evolving Technologies in Data Security
Cybersecurity: Evolving Technologies in Data Security 700 500 Xcelpros Team

Background

Cyber attacks aimed at businesses are increasing in frequency. The days of posting a message bragging of an attack are over. Instead of fame, cybercriminals want money. Specifically, they want untraceable electronic currency such as bitcoin.

Greed is the reason why many cyber attacks use ransomware that locks a network until the money is paid.

Figure: 1Annual number of ransomware attacks worldwide

Global Cybersecurity Attacks

According to PurpleSec, the estimated global damage from ransomware was:

  • $8 billion in 2018
  • $11.5 billion in 2019
  • $20 billion in 2020

The same PurpleSec report states that an attack on a supply chain affected more than 18,000 customers. Fortune 500 companies and government agencies were among the victims.

“Threat actors search for targets that can be easily compromised and have significant monetary value. Attacking a supplier to gain entry to larger organizations is one way to bypass their sophisticated security controls,” PurpleSec states.

Other numbers important to business leaders are:

  • 45%: The number of breaches involving hacking compared to 22% for phishing and 17% using malware (Verizon)
  • 68%: The percentage of business leaders who believe their cybersecurity risks are increasing (Accenture)
  • 86%: The number of financially motivated breaches compared to 10% from espionage (Verizon)
  • 95%: The number of cybersecurity breaches caused by human error (Cybint)
  • 11,762 recorded network breaches from Jan. 1, 2005 – May 31, 2020

Source: VARONIS.COM

Reducing Cyber Attacks

Companies big and small are rightfully worried about keeping their data secure, especially today. 2020 saw a dramatic increase in the number of employees working from home, many using basic home internet to connect with company networks.

A Dec. 9, 2020 Pew Research study of workers who can perform their jobs at home shows:

  • 20% worked from home before the coronavirus outbreak
  • 71% are working from home during it
  • 54% want to keep working from home after virus-related restrictions end

Many companies store their data in distributed computer server centers collectively known as “the cloud.” The widespread adoption of cloud computing and the internet of things (IoT) IoT systems potentially exposes businesses to cyber attacks. Add to this explosive growth in the number of people working from home and it’s easy to see how much more vulnerable businesses are now than ever before.

Is Cloud Computing Safe?

In short, the answer is yes.

“Information stored in the cloud is likely to be more secure than are files, images and videos stored on your own devices. Why? Cloud companies often rely on far more robust cybersecurity measures to protect your sensitive data,” antivirus company Norton suggests.

Figure: 2Key security advantages of Cloud data storage over using an in-house server

key security advantages of Cloud data storage over using an in-house server

Cloud data storage has four key security advantages over using an in-house server:

  • Limited physical access: Few people have access to warehouses holding the large server farms.
  • Constant security updates: Larger cloud storage companies immediately apply security updates even though they are already using high-grade and more robust operating systems.
  • Distributed computing: Cloud data is not typically stored on just one set of servers in a single location. The data is typically backed up to at least one remote site, preventing data loss should a natural disaster strike.
  • Data encryption: All data is kept secure behind robust firewalls to prevent unauthorized access. Should a hacker make it past the firewalls, they then have to decrypt the scrambled data. Top-level encryption methods include Rivest-Shamir-Adleman (RSA), the Advanced Encryption Standard (AES) and others.

Data Encryption

Using codes to hide messages from view is no longer limited to spies. Businesses have been using encryption methods for millennia starting with the Spartans in 600 BC.

Note that Microsoft Office 365 lets company IT administrators turn on encryption by default for all emails in Outlook. Individual Outlook users can also send and receive encrypted messages.

Microsoft states that Dynamics 365 encrypts data at rest and in transit. “Microsoft uses encryption technology to protect customer data in Dynamics 365 while at rest in a Microsoft database and while it is in transit between user devices and our data centers. Connections established between customers and Microsoft datacenters are encrypted, and all public endpoints are secured using industry-standard TLS. TLS effectively establishes a security-enhanced browser-to-server connection to help ensure data confidentiality and integrity between desktops and datacenters. After data encryption is activated, it cannot be turned off.”

Encryption and CGMPs

The Food and Drug Administration’s Current Good Manufacturing Practice (CGMP) regulations list 188 instances where encryption is mentioned. One frequently used section is the use of electronic signatures for regulatory documents known as SOPP 8116 from the Center for Biologics Evaluation and Research. Part of this requirement is using secure email to communicate with the FDA. That requires encryption.

Title 21 of the Code of Federal Regulations covers the FDA’s portion. Many of the CGMPs listed require stored data to be either encrypted or hidden in some way, especially if it contains personally identifiable information.

Using Blockchain with D365

According to Microsoft, blockchain, “is a secure, shared, distributed transaction ledger database that decentralizes data, eliminates the need for trusted third parties and enables the anonymous exchange of digital assets such as bitcoin,”

“It is a replicable database that is immutable, verifiable and cryptographically secure, establishing trust through a network of untrusted nodes.”

An updated version of blockchain, Blockchain 3.0 with cloud servicing, multilayer middleware and cryptlets, is one of Microsoft’s greatest innovations.

An important part of the pharmaceutical business is the supply chain. Microsoft’s blockchain version helps create smart contracts, process micropayments, filing taxes, shipping and logistics management.

The Microsoft Azure platform on which D365 sits can also use blockchain technology to help manage physical assets across the supply chain.

Summary

Any business serious about protecting its data will want to explore cloud data storage. It’s now more secure than many private networks. Cloud computing companies such as Microsoft go to great lengths to encrypt all data, which they keep stored behind robust firewalls.

Additional functionality in the form of blockchain technology helps track and protect pharmaceutical supply chains from raw materials to delivered goods.

Get a consultation to know-how our cloud solutions can help strengthen your data security.

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Importance of Robust ERP in Sustaining Manufacturing
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Importance of Robust ERP in Sustainable Manufacturing
Importance of Robust ERP in Sustainable Manufacturing 700 500 Xcelpros Team

Importance of Robust ERP in Sustainable Manufacturing

ERP has been critical to the manufacturing sector, from business strategies to meeting increased demand for specific products. Moving forward, manufacturers need to rethink their supply chain and inventory management strategies and implement proven and systematic resource planning tools. For more information see the full article here.

Book a consultation for all your manufacturing process needs.

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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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Why Pharmaceutical Manufacturers Should Choose Microsoft Dynamics
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Why Pharmaceutical Manufacturers Should Choose Microsoft Dynamics 365 Finance and Supply Chain
Why Pharmaceutical Manufacturers Should Choose Microsoft Dynamics 365 Finance and Supply Chain 700 500 Xcelpros Team

Why Pharmaceutical Manufacturers Should Choose Microsoft Dynamics 365 Finance and Supply Chain

In the pharmaceutical industry, there’s a constant need to manage different challenges such as ever-changing regulations, severe production environment difficulties and complex equipment that can be difficult to maintain. As the pharmaceutical industry continues to evolve and grow, understanding and adopting intelligent technologies like Dynamics 365 becomes more and more apparent. For more information see the full article here.

Get started with one week no-obligation pilot to experience Microsoft Dynamics Finance & Supply for Pharmaceutical

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ERP in Inventory Management
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The role of an ERP system in Inventory Management
The role of an ERP system in Inventory Management 700 500 Xcelpros Team

Introduction

A previous article on enterprise resource planning software (ERP) mentioned the benefits of artificial intelligence (AI) and machine learning (ML) in business software. This article covers how Inventory Management functions as part of an ERP.

The common purpose of any ERPs is to integrate, centralize and streamline all business operations. The most common ERP inventory management functions are:

  • Supply Chain Management including tracking and managing raw materials, work-in-progress and finished products
  • Integration with logistics, shipping and B2B ecommerce
  • Managing procurement and sales orders
  • Distributing orders across channels
  • Warehouse management and stock transfers using serialization
  • Integration with Payment gateway
  • Managing accounts
  • Dashboarding and report generation using analytics
  • Quality Management
  • Demand forecasting using AI and ML

Executive Summary

  • ERPs have a broad range of application areas. Inventory management is the most sought out functionality (67%) among users after Accounting (89%).
  • Inventory management helps companies organize and plan their production strategy, along with maintaining ideal stock levels.
  • Effectively managing inventory promotes more efficient use of precious working capital, helping to maintain optimal stock frees working capital and prevents losses due to stock-out.
  • The average manufacturer has 10% – 20% of its revenue committed to inventories. Reducing inventory by 20% – 25% can cut the revenue impact by 2%- 5%. For a $6 billion company, that inventory reduction frees an estimated $200 – 500 million in working capital.

ERPs perform many inventory management functions, supporting the entire supply chain from order and storage of raw materials to final delivery.

Today, the importance of inventory management has continued to evolve. It no longer deals only with keeping track of what’s currently in the supply, production and delivery pipelines. It also has a significant effect on business strategy.

ERPs are now equipped with artificial intelligence and machine learning. These additions transform a tool first appearing in the late 1990’s into an invaluable piece of technology. For example, using historical data, a modern ERP can more accurately predict future demands and current inventory levels.

All businesses are realizing the benefits of going digital. Traditional companies that once shied away from adopting technology are now embracing it.

Connecting businesses, such as a pharmaceutical manufacturer with its internal and external suppliers, generates massive amounts of data. ERPs help chief executive officers and other leaders make sense of the numbers. The software lets leaders compare historical behavior with current trends, making accurate inventory predictions. ERPs can reveal important insights by leveraging data across business functions.

Benefits of ERP In Inventory Management

A SelectHub survey found that Inventory Management (67%) was the most used part of a modular ERP package after accounting (89%).

Figure: 1A 2018 Survey by Select Hub Found That The Most Important Function in an ERP was Inventory Management

Inventory Management functionalities

Functions of ERPs in Inventory Handling

ERPs perform six primary inventory related functions. These include:

  1. 1.Better forecasting accuracy
  2. 2.Segmenting, clustering and classifying materials
  3. 3.Making warehouses more intelligent
  4. 4.Permit accurate, timely inventory planning
  5. 5.Reduce waste
  6. 6.Manage returns and order cancellations

Improving Inventory Accuracy: Some modern ERPs like Microsoft’s Dynamics 365 Finance come with many built-in AI and ML capabilities. This functionality lets executives review sales data, seasonal demand and other information to predict inventory needs. By comparing historical and current data, companies can devise a robust plan to increase or decrease inventory and storage capacity suiting anticipated market conditions. D365 Finance also accepts variables for greater accuracy.

Key benefits include:

  • Artificial intelligence helps predict future demand using historical data
  • Comprehensive inventory planning translates to higher customer serviceability, boosting customer satisfaction

Segmenting, clustering and classifying materials

Isolated data is only valuable to that portion of the business. To help the entire business and provide insights, data must be visible to other departments. Using an ERP’s Inventory Management module lets companies tag, cluster and analyze each item or stock keeping unit (SKU). It produces labels that can be read by mobile phones and other portable devices, providing access to a wealth of information while tracking every item. Classification options include:

  • Units of measurement
  • Product usage
  • Material source
  • Alternatives or substitutes
  • Allocation
  • Cost and price
  • Demand
  • Supplier or vendor

Classifying inventory items lets users analyze each item based on the business needs, and prioritize the ones that are most critical.

Making Warehouses More Intelligent

When products are given machine-readable barcodes or QR code labels, companies can track material movement in real-time.

Modern ERP lets warehouse managers create an operative warehouse plan with access controls at every level. This is particularly crucial for manufacturers with multiple production sites. Setting access controls ensures the right people can move inventory items at the right time.

ERPs allow warehouse managers to efficiently allocate more space to the items that need it and reduce space from those that do not.

Combining the functionality of an ERP with robots and other forms of automation reduces human efforts. For example, beverage giant Coca-Cola uses AI to count the varieties and volume of bottles stored in cabinets or display units by analyzing a photograph clicked on a mobile device.

Other benefits of an efficient warehousing plan include:

  • Tracking each stage of a product from raw material to work-in-progress and finished goods
  • Preparing accounts for stock transfer
  • Reducing human effort in mundane tasks, such as manually counting inventories, letting workers perform more valuable jobs
  • Maintaining ledgers of opening and closing stock balances
  • Reducing dead stock by efficiently managing expiring inventory

Permit Accurate and Timely Inventory Planning

An ERP system ensures companies maintain ideal stock levels, permitting more efficient use of working capital.

Today’s ERPs come with features that help with material requirements planning (MRP). This includes production scheduling, setting up reorder-levels and establishing inventory minimum and maximum levels. The business application tool records lead times related to purchases of raw materials, manufacturing time, quality checking, packaging, logistics and other functions. All of this data combined helps the planning engine create better forecasts.

Reducing Waste

The combined benefits of classifying items and inventory planning helps reduce waste. The inventory management module of an ERP provides complete visibility of all inventories, including clusters and substitute products. Module users can also sort inventories by batch numbers or serial numbers.

When a particular product has an unanticipated surge in demand, companies can easily identify substitute products in an attempt to reduce lost sales. Aligning substitute and primary products lets customers looking for affordable alternatives or shorter lead times find workable options, further boosting revenue.

Waste reduction benefits of an ERP include:

  • Offering alternative or substitute products when primary product levels are low.
  • Provides options for price sensitive customers, increasing customer loyalty.
  • Uses attributes assigned to each SKU to make it easy to locate substitute products.

Managing returns and order cancelations

ERPs manage returns with greater ease than older methods. ERPs reconcile sales credit memos and accounting letting companies issue refunds or shipping fresh products.

Return benefits include:

  • Easier tracking of refunds and reshipments.
  • Quicker return decisions by providing a complete view of sales, current inventories, cash balances, shipping availability and other issues.
  • Automatically calculates foreign exchange rates.

Conclusion

The primary benefit of an ERP system is the ability to track inventory, reduce stocking costs and maximize working capital accurately and efficiently. This significantly reduces administrative and operational costs without sacrificing functionality.

Organizations looking to optimize inventory planning and become more competitive must implement a modern ERP system. The cost of implementing a modern ERP is easily made back in overall savings with included inventory controls that are more accurate, reduce waste, and produce happier customers with much greater flexibility.

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References: ERP buying trends

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.

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Overcoming Chemical OSHA Compliance Challenges using Technology
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Overcoming OSHA Compliance Challenges in the Chemical Companies using Technology
Overcoming OSHA Compliance Challenges in the Chemical Companies using Technology 700 500 Xcelpros Team

At a Glance

  • Differing definitions of what’s considered hazardous makes it tough for chemical companies to comply with rules that could vary from region to region.
  • Chemical companies face daunting regulatory and operational challenges when complying with workplace safety rules.
  • Finding ways to make compliance smoother is crucial to chemical companies.
  • Using modern technological tools such as Integrated Chemical Management for Microsoft Dynamics 365 (iCM) can help chemical companies comply with complex, confusing rules and regulations.

Introduction

The chemical industry is constantly under increased scrutiny due to potential health and safety risks inherent to its workforce. These companies continuously face challenges following current regulations, applying updates, ensuring accurate documentation and following labeling guidelines. Chemical companies need to be able to carry out hazard determinations, have a full understanding of applicable regulations and stay up to date on OSHA guidelines. Those that don’t, risk exposing themselves to additional inspections and the possibility of serious fines. Thankfully, more companies are finding that compliance ratings can be improved using cutting-edge tools and technologies.

Occupational exposures, exposure to lead and acute poisonings resulting from unsound management are estimated to account globally for 1.3 million deaths.Source: The World Health Organization

Regulatory Compliance Challenges

Some of the regulatory compliance challenges facing chemical companies include:

  1. 1.Data Management: Regulatory changes can require wholesale updates to a chemical company’s data management system. “The Final Rule to Improve Tracking of Workplace Injuries and Illnesses does not add to or change an employer’s obligation to complete, retain and certify injury and illness records. It only requires certain employers electronically submit some of the information from these records to OSHA,” the department states. Complying with this rule may require costly updates.
  2. 2.Geographic Barriers: Chemicals are used, supplied and manufactured worldwide. The definitions of hazardous chemicals can change with every region. Having to include environmental and workplace safety laws that can vary from state to state, not just country to country, makes it tough for companies to stay on top of the laws.
  3. 3.Language Barriers: Moving chemicals from one part of the planet to another means manufacturers and shippers are also likely to run into different languages, which can add problems.
  4. 4.GHS Labeling: OSHA states the Globally Harmonized System (GHS) of Classification and Labeling “provides a common, coherent approach to classifying chemicals and communicating hazardous information stored on labels and data safety sheets,”. GHS also helps reduce trade barriers and increase productivity for American businesses that handle, store and use hazardous chemicals. Complying with GHS standards, which OSHA has enforced in the United States since 2012, requires chemical containers to have a harmonized signal word, GHS pictogram, a hazard statement for each hazard class and category plus a precautionary statement. Chemical companies need to be agile enough to monitor and adapt to these updates.

Role of Technology in Meeting the Dynamic OSHA Compliance Needs

More and more, chief experience officers (CXOs) and chief executive officers (CEOs) of chemical companies around the world are realizing the benefits of applying cutting-edge technology to chemical regulatory compliance. Using newer products such as Integrated Chemical Management for Microsoft Dynamics 365 (iCM) is the best way for chemical companies to keep pace with dynamic OSHA guidelines. Tools like iCM can integrate with a company’s existing data to make it more agile and effective.

ICM is the chemical industry’s first overarching tool designed to help automate Safety Data Sheet (SDS) authoring and maintenance, GHS-compliant label management and safety management compliance. Aside from ensuring compliance with changing OSHA guidelines, ICM helps organizations with the following:

  • Centralizing data, making it easier to access. Any changes in data enjoy increased visibility and can be tracked across different functions and regions.
  • Removing the need to pay for outside labeling and SDS authoring.
  • Reducing manual data inputs and related errors.
  • Providing real-time maintenance and updates to SDS and label management while remaining in compliance with existing GHS guidelines.
  • Reducing time-to-market through greater efficiency.
  • Promoting better OSHA compliance through integrated Safety Data Sheets (SDS) management and by removing the need to maintain paper product safety documentation.

Figure: 1Key Functionalities of Microsoft Dynamics iCM

Integrated Chemical Management Key Functionalities

This is a critical aspect for staying power in the industry. Chemical companies need to audit and update their IT infrastructure to ensure processes and procedures stay current with any changes to OSHA and GHS guidelines. GHS guidelines for example, have been updated five times since 2012, and most recently in 2019.

Updating data collection technology not only promotes better legal compliance, it also improves safety in the workplace, better protecting employees, and the environment, from the misuse of hazardous chemicals.

Today’s customers are more aware of potential chemical hazards than ever before. They are more likely to use a company that takes safety guidelines seriously. Adapting and leveraging advanced technologies is an integral way chemical companies can improve their OSHA compliance and boost their brand presence.

For those companies finding the ever-changing landscape of OSHA guidelines intimidating, updating to iCM can make managing regulatory compliance a much smoother process.

Key Takeaways

  • Managing regulations across the supply chain from raw material suppliers to end customers is easier with the help of a comprehensive system like Microsoft Dynamics 365 with iCM.
  • Chemical companies can use technology experts to smoothly implement the latest tools and ensure compliance to health and safety rules.
  • Obeying safety and environmental regulations improves the public’s perception of a company’s brand.

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