| 
| 
At a Glance
Supply chain management is one of the most critical elements of success for any business in today’s global market. However, its application is undermined by many companies as business leaders face challenges to control the cost of a supply chain without compromising on its efficiency. Since COVID-19 we have witnessed drastic changes in methods and methodologies for streamlining supply chain operations. It, however, doesn’t take away some key fundamentals required for healthy functioning of a company’s supply chain and inventory management.
According to the Logistics Bureau, for companies running global operations, their supply chain cost could rise as high as 90% of their total expenditure.
The problem lies in poor strategic management. Supply chain managers are focusing on cost minimization, most of them without having detailed field knowledge of how the system works, and the result is it is impacting other areas of the process such as inventory optimization, ‘on-time delivery in full (OTDIF)’ and customer satisfaction. Trying to improve one KPI is resulting in a cost spike in other areas of operations, which can have a long-term impact on revenue.
FIGURE 1 Where Business Leaders are Falling Short
A robust supply chain needs strategic alignment and planning in line with the overall business functioning. For example, in order to control cost, you need to first understand the key drivers of cost in the supply chain and most importantly how to measure the supply chain cost. While the strategy is important, establishing an integrated supply chain requires a synchronized approach to planning, execution, and application of technologies in order to create an end-to-end unified system across the entire organization.
FIGURE 2 Key Elements of an Integrated Supply Chain
In this article, we will touch upon some interesting facts that make an appealing case as to why the Supply Chain strategy needs to be digitally enhanced and properly integrated with other parts of the business.
The rapidly evolving business landscape is disrupting the way companies function. Moreover, the advent of the latest technologies and growing competitive markets are driving companies to push their limits and redefine supply chain operations.
Is your business ready to embrace a digital supply chain as a key distinguishing factor for its competitive advantage?
Most SMBs are holding back the transformation due to the fear of possible risks that could surface. Per our industry experience, it’s due to the age-old perspective in which company leadership is analyzing their supply chain. In most of the cases, we found that they are way behind the entire purview and don’t realize the true potential of a well-integrated, technologically advanced supply chain.
Traditionally, business leaders focused on pricing and product quality, but priorities today have completely shifted. Major Objectives and Key results of organizations are geared towards optimized supply chain and operations to boost businesses forward. With Industry 4.0, advanced analytics, and robotic process automation rising, companies are realizing the need for an integrated supply chain. This has become even more true as the Covid-19 crisis continues. Demand planning and fulfillment, supplier-customer relationship, customer retention, on-time delivery are some of the major expenses of a company. An efficient supply chain not only helps with cost reduction in these segments but also ensures growth, profitability, and customer satisfaction.
Top Reasons to Upgrade Your Operations with a Next-Gen Digital Supply Chain:
Shifting from a plant-level production planning to a demand-driven focus with customer-centric mindset but not compromising with the product quality
Getting rid of outdated processes and technology to match the transforming global business landscape
Reducing cost to formulate a more efficient value chain to remain cost-competitive in the market
Ability to outsource parts of your supply chain process in order to reap economic benefits and superior supply chain network design
Achieving more efficient product lifecycle management
Collaboration with stakeholders to integrate business processes for increasing visibility throughout the value chain
An integrated supply chain influences the overall functioning and improves profitability of the business. Going digital and increasing interoperability across these functions sets a business up to accelerated growth. Let us discuss a couple of key areas that are impacted by a well designed supply chain.
FIGURE 3 Upgrading the supply chain will improve your bottom line
When business leaders discuss improving their supply chain, their main focus is usually related to accelerating growth by cutting down costs, achieving better lead time, and ensuring on-time delivery; as all these factors contribute towards business development. What slips from their mind is what customers really care about. It all starts and ends with customer satisfaction. Delivering the right product at the right time improves your organization’s brand value and credibility to customers.
What the customer cares about is receiving quality products on the promised delivery date without having to spend too much time or effort. This can be seen in Amazon’s announcement of one-day delivery. Late and inaccurate deliveries bear a significant impact on customer loyalty.
70%
of industry professionals predict that their supply chain is going to be a key driver of improved customer satisfaction by the end of the year.
Source: Accenture
Your procurement division must understand the importance of cost-saving, but they need to be in line with the expectations of the customers and procure quality raw material for manufacturing the items. If expectations on raw material quality is not set, you could save money purchasing raw materials upfront, but end up spending more in the long run.
Kimberly-Clark is a manufacturing-focused organization that up to a few years ago did not have a supply chain division. Sandra MacQuillan, their first Supply Chain Officer, built a solid team to ensure the supply chain was focused on customer satisfaction. In the process, she integrated various functions such as procurement, quality (know more on quality management by clicking here), logistics, manufacturing, safety, etc. that are interconnected and delivered for one common goal – that is customer satisfaction.
Kimberly-Clark was able to achieve 25-30% cost savings by interconnecting various aspects of the Supply Chain, focused on better customer service, resulting in improved efficiency.
If you connect with the issues faced by Kimberly-Clark, or your supply chain is functioning in silos, it could be the best time to make a change. You can take this opportunity to update and integrate your supply chain with overall business functions and work towards a common goal like customer Satisfaction. A strongly integrated application will have the ability to incorporate holistic business functions including analytics, collaboration with notification, secure information sharing, control-based decision making using Artificial Intelligence, and more.
FIGURE 4 KPIs that are critical for supply chain monitoring
According to the Logistics Bureau, nearly 50% of companies shut down within the first five years of operation. One critical factor contributing to these failures is an inefficient and poorly conceived supply chain. Supply chains in most organizations have evolved as a practice, rather than a well-designed process.
79%
of companies with robust and high-performing supply chains are able to outperform their average peers in terms of higher revenue growth. This fact signifies the positive implication of a connected supply chain for a business.
Source: Deloitte
For an effective, integrated approach to Supply Chain Management (SCM) the organization must operate end-to-end as a unified entity.
01
Move beyond basic business and functional unit design and metrics. Look at the organization holistically and define the objectives as a complete entity.
02
Take a cross-functional approach to business process design. Start at a high level and map out the supply-chain flow with the goal of creating an end-to-end mapping of the business process.
03
Leverage a cross-functional approach to IT systems design. As much as possible, standardize the organization in terms of the applications that are used. Seek to eliminate as many disparate applications as possible in favor of a common set of applications across the business.
04
For most organizations, the major roadblock in delivering an integrated approach to supply-chain management is culture change. Change of this magnitude must be driven by solid leadership. There should be strong collaboration to drive the effort to deliver an integrated supply-chain organization.
05
There is no way the importance of an integrated Supply Chain should be overstated or undermined. If you or your organization have not prioritized your supply chain efforts, it’s never too late to take the first step.
An intelligent ERP software comes with a holistic supply chain module along with advanced analytics to support the following functionality.
In order to push a company forward especially post-COVID-19, a sound digital supply chain strategy would be needed.
Do not let operational inefficiencies limit your business, long-term goals
The ultimate goal of any enterprise is that of speeding up processes, reducing errors, and increasing business output for better revenue generation. With the onset of the digitization era, companies have upgraded their technological prowess to adapt to process automation. It is important to understand that in the rapidly transforming world, process automation is not just a technological ability to speed up processes but a strategic movement towards better use of software to streamline workforce, introduce better work practices and mitigate cost inflations. Since COVID-19, process automation has turned into a need of the hour to improve operations that are built with adherence to process compliance and yield better outputs with a limited workforce. This means process automation will transform enterprises at a larger scale to increase agility and reduce dependency on manual work.
Is your business still operating through manual handoffs, excel macros, and cumbersome reporting? As businesses are integrating automation in more rapidly in different facets right from HR to Marketing, Production, Sales, and Information Technology; there is a considerable reduction in human intervention for mundane and simpler tasks. A component of efficiency will be introduced with the implementation of Robotics and Artificial Intelligence (AI) in process automation. According to a leadership piece by Sogeti (1), enterprises will look into integrating robotics process automation (RPA) with AI to extract more business value. Read on to know why an enterprise should consider intelligent process automation for complete transformation and the latest trends that will help businesses along the path of said transformation.
As an enterprise, you need to ask yourself a key question: Where should the business’ attention be?
While at face-value this question may seem trivial, the entire enterprise architecture revolves around this key aspect. The more attention your skill base gives towards the latest trends like the Internet of Things (IoT), Machine Learning, Cloud, Advanced Analytics, Artificial Intelligence, and automated-integrated workflows, the better streamlined and agile your workforce would be. Hence it is highly significant for enterprises to explore deep into the latest process automation trends and make their employees acquainted with these trends for a competitive edge.
There is no doubt about the fact that legacy systems need upgrades and modernization to encompass latest trends of digitization, modern technologies and to become aligned with the fast-paced, changing business demands. Process automation plays a key role here. If not for process automation, the IT systems would face the brunt of not being able to keep up with business process improvements (carried out usually at a large-scale), leading to lesser productivity and overall loss of revenue. Automation helps you form ‘bundles’ of data and migrate them to platforms for systematic records management. Process automation can help your enterprise reduce the error rate, and increase productivity at a lower cost. But one point to remember is that the process automation described above would only make sense if your company has already transformed into a modern ERP system.
Figure 1 8 Reasons to Automate Your Business Processes
1.Handling the Unstructured Data Challenge: While data on systems has been very much taken care of by current process automation tools, enterprises and their related facets still struggle with unstructured forms of data such as hand-written notes, bills, invoices, images, etc. With the introduction of machine learning and artificial intelligence, businesses are digging up automation solutions that will not only recognize this type of data (with the help of Robotics), but also assimilate and use it in processes similar to structured data.
2.Low-Code Solutions for Faster Results: Robotic process automation when integrated with low code solutions forms a golden bridge of zero human intervention and faster application development. These low code solutions enhance efficiency as well as help in transforming core processes like Customer Relationship Management (CRM) and Enterprise Resource Planning (ERP).
3.Integration of Robotic Process Automation (RPA) with Business Process Automation (BPA): Interdependent workflows have always been a part of large enterprises and the IT skill set in an organization has mostly been at the helm of managing these interconnecting processes in a complex workflow system. The latest automation tools will help in integrating RPA with BPA resulting in the formation of intricate workflows and implementation of all the related processes.
4.Real-Time Automated Decision Making: Enterprises will see more and more management of big data with the help of artificial intelligence and this will facilitate the way for flexible tools for IT operations that will preempt glitches and provide real-time solutions. This will help in better resource-allocation, lesser communication gaps, and fewer outages.
5.A Chance Towards Skill Set Upgrade: When computers were introduced as a tool to reduce human effort, they were met with a lot of apprehensions. In fact, many considered them as machines that would make a human contribution to technology obsolete. Similar apprehension and even cynicism can be seen in the case of process automation tools and software. After all, process automation eliminates the need for human intervention, making many technical jobs outworn.
However, enterprises are now looking up to this advancement in process automation as a chance to upgrade the skill set of their current employee base and make them adept in the latest technologies and tools. This will not only help the IT personnel move from labor-intensive, monotonous jobs to skill-based, dynamic ones, but it will also create a learning curve in the industry resulting in more innovations. When put in perspective, automation is not the cause for losing jobs, it is instead an opportunity for companies to fill the skill set gap and enhance the expertise of their IT personnel for innovation and better strategic output.
By 2023, AI-enabled automation in data management will reduce the need for IT specialists by 20%
An enterprise cannot deny the fact that adapting to the need of the hour with the latest process automation trends is going to work in favor of its core business value. Numerous users across organizations will gain access to data, automated workflows that will be systematically prepared, and actionable insight that will aid towards building an agile enterprise. In the current market being agile as a company will be your strong suit. As they say, the cards are laid on the table; it is up to the businesses now to play their hand wisely!
Remote work is becoming more prevalent post-COVID-19. Companies are looking for more ways to streamline operations, engage the workforce, and yet meet the needs of customers. Process automation plays a major role in volatile market conditions during COVID-19. A combination of Microsoft’s Power Platform, AI – ML, Dynamics 365 for Sales and Dynamics 365 ERP, integrated with Teams allows users to streamline their processes and build needed visibility for management to effectively view the progress of operations remotely.
In fact, a successful use case off-late within various companies is to integrate Dynamics 365 with flow, teams, planner, and SharePoint to enhance compliance of process, coordination with team members remotely, track processes that are running in each department and provide task execution clarity for each employee within a department. More companies are adopting this suite of tools to improve productivity and simplify workforce engagement. All major functions of a company – be it Procurement, Sales, Manufacturing, Quality, Finance or HR, when unified together help a business stay afloat during challenging market conditions and support the over well-being of a business.
Reach out to us for your company’s Digital transformation
In recent years there have been more stories of ERP implementation failures. With this in mind, it is understandable why organizations might be apprehensive about investing in a new ERP solution when the failure rate is high. The reality is that most of the ERP implementation projects often fail to meet the triple constraints – scope, budget, and timeline. These projects tend to start well with a Project Charter that lists out the objectives, and very quickly, deviations start hindering the project. Despite these hindrances, companies that do not shift to a new age ERP to optimize their business functions, especially post COVID-19, fall into the risk of losing business. How do companies then overcome a standstill situation? Read on to know more about how you, as a company, can progress forward and overcome this dilemma.
50%of SMBs will focus on the integration of on-premises and cloud resources by 2021 and it will be their top IT spending.
2/3 of SMBs will have digital transformation as a key part of their IT strategies by the end of 2023.
60%of SMBs will have mobile worker support in place by 2021.
If you are a Small or Medium business owner, your workday often starts at home by triaging emails early in the morning. Having grown the business from the ground up, you know your customers / vendors, and you’re still involved in day-to-day operations. But the bigger the company gets, the more complex your business processes become. Each email adds something to your to-do list, which typically requires transitioning to a different application.
You use accounting software to prepare an invoice, a CRM system to manage your contacts and sales pipeline, and perhaps yet another manufacturing solution to track production or inventory. Switching back and forth between fragmented, stand-alone solutions takes time and often requires duplicate data entry. This diminished productivity stifles your ability to scale and cuts into the time you could spend developing new business. To keep up the pace of your growth, you’re likely considering the move to a more comprehensive business management solution. Read on to dive into how to make it happen.
Companies cannot hide in the comfort zone of their existing antiquated applications forever. Disconnected systems cannot handle the complexity of a growing business. Post COVID-19, the impetus is towards operating rapidly with fewer resources, reduced cost, and still being able to build a system that will set companies to thrive in the market.
Technology objectives for business involve:
It would help if you had a champion within a company that understands the importance of staying agile in challenging market conditions. This champion should spearhead the rapid transformation project with the help of experts that excel in ERP implementations and have seen a variety of implementations across multiple applications.
Assessments are done during any phase of the project, to make sure the project is on the right path, especially when there is a high spend involved. In most cases, management’s perspective either will be that the software is too slow and complex to adapt to the company environment, or selection of “wrong” software packages led to the failure. The primary reason for an ERP project failure is due to the lack of proper user adaptability rather than any issues with the software as issues with software are easily fixed through update patches from the ISV.
The right time to do the assessment is before starting the implementation. It is essential to conduct a risk-free assessment, benefits analysis, performance objectives for operations, and budget analysis. Ideally, a Free Pilot that gives you a gist about the application and how it may fit in your company can be an ideal route. After all, an ERP is a critical investment that companies, especially SMBs, undertake towards upgrading their business capabilities. The evaluation of ROI is, therefore, essential and can be assessed based on how quickly the business can leverage a new ERP system in line with the objectives of the investment as a whole. A little bit of caution, careful planning, and looking below the surface can take you miles closer to a successful ERP implementation.
Nearly 75% of all ERP deployments fail to meet their expected business objectives in entirety.
Below are a few reasons why ERP implementations see significant deviations from the original scope that impacts the triple constraints:
1.Undefined Objectives – Once you decide to migrate to a new system, your first step should be to define the clear goals for the project, allowing you to refer back to them if and when deviations popup.
Few questions that would aid the transformation:
What are you trying to accomplish with the new system?
What improvements are you expecting in every department?
Is the goal automation and standardizing workflows, increasing collaboration across departments, or speeding up time to market or reducing throughput time?
Are all of your goals possible to achieve through this deployment?
What is the absolute must-have for the transformation?
And what protocol is in place to handle deviations when a wishlist pops up that steers the project out of control?
2.Limited Resources – Most companies underestimate the totality of the internal resources needed for the project. Companies often don’t plan the right kind of internal resources to help the transformation, play liaison, and make the tough decision on what requests are unreasonable for a successful go-live.
3.Change Management – A new ERP brings change to your entire organization, impacting the daily lives of employees across all functions. Each employee’s level of change tolerance differs, and being open to learning a new system becomes part of the change management process.
4.Unrealistic Timelines – Project schedules are no less important than planning the budget and resources. We often see unrealistic timelines that don’t align with the expectations of the project. Management may want to push functionality that may not be feasible in the first implementation rollout.
5.Hefty Customization – Customizing your ERP system can offer you an extra edge but also involves risks. Customizations often start small but can quickly grow in complexity, further extending timelines and adding hours and hours of additional development. A recent survey reveals that less than 20% of respondents implemented their ERP system with little or no customization. Most companies find it enormously challenging to control the project scope by turning down customizations.
The majority of ERP system failure attributes to hefty customizations.
FIGURE 1: Case Study: Hershey’s Story Is a Living Example of ERP Implementation Mistakes
Outcome: Harshey had to lose a huge percent of market share over competitors such as Nestle, Mars. Underestimating change management, having set unrealistic timeline and inadequate training resulted in implementation failure of the ERP system. Despite having warehouse filled with inventories, most of their products could not hit the market on time.
According to Gartner, 90% of organizations shift their preference from a single vendor ERP suite in favor of integrating multiple niche applications, which it recognizes as a postmodern ERP application.
To ensure a successful ERP implementation, your organization needs to follow a few practices including:
Analyze key Performance Indicators (KPIs) to help track the critical purposes of ERP implementation, such as supporting organic expansion and transparency in operations.
01
Examine vendors for their technological knowledge, industry experience, and prior success rate before signing contracts. You want trained professionals with in-depth knowledge that can help reach the expected output.
02
Evaluate the right project methodology that can be converted into a set of executable tasks for the project, and agree to the process and protocols involved in it. You will want someone in-house with prior experience to be the liaison between the implementer and the end-users.
03
Finalize essential ERP features for your implementation, remembering to take into account the budget, synchronizing it with core business requirements. Create a blueprint of the intended design.
04
Identify only the data essential to transfer and try to keep it to a minimum. Data migration can be a tough task, and burdening the software with irrelevant and unstructured data could slow the process.
05
Train end-users and employees to develop susceptibility in them to changes. As updates or developments take place within the ERP system for increasing efficiency within the organization, employees should be confident enough to absorb those changes.
06
Understand that testing is essential for an ERP implementation. You will want to formulate a plan and a method of testing to understand the issues that popup during builds and a process to resolve the problems. It’s also important to realize that if problems arise during testing, they will need to capture the necessary details of what needs to be corrected. These issues are not a reflection of what the system will be post-go-live, as long a timely resolution plan exists. If the same problem repeats, it is essential to highlight the issues which could be due to an underlying data or design defect.
07
The ERP that is chosen should have the potential to meet all of the business objectives. Users should be trained to understand the system, to avoid issues with data integrity or process efficiency. Ultimately the primary aim is to minimize slowdown in operations due to limited workforce.
Accessibility of real-time data from any location helps the workforce to support agile business operations. Businesses need to integrate and streamline all activities of the organization and promote real-time visibility of operations such as:
You need a solution that helps maintain compliance, secures data, and delivers a 99.9% uptime service level agreement.
Your ERP solution suite should provide with the possibility to
Most SMBs will outgrow basic accounting tools due to the lack of functionality and integration. Disjointed systems create incomplete data and tedious reporting resulting in blind spots and poor decisions. Lack of controls, workflows, and unsecure data causes further business risks. An agile application such as Dynamics 365 Business Central natively integrates with Office 365, PowerBi, and Microsoft Dynamics Sales apps – boosting the company’s ability to perform in challenging market conditions. It helps to run your business with a single solution that streamlines business processes and helps employees work faster and smarter. The heterogeneity of a suite of applications like Microsoft leverages the combined strength of the best apps for specific tasks, which is not possible through an individual ERP.
Together, Microsoft Dynamics 365 Business Central and Office 365 help you:
Xcelpros has designed packages for Microsoft Dynamics 365 Business Central (recommended for SMB with simpler processes), Microsoft Dynamics 365 Finance (recommended for SMB or Larger companies requiring more comprehensive Financial functionality), and Supply Chain (recommended for SMB or Larger companies requiring more comprehensive Supply Chain functionality).
Take Our Assessment to Get Started With Digital Transformation
