Microsoft Dynamics 365

Fraud in the Pharmaceutical Industry

Fraud and Pharma: Inventory Control Tech Reduces Rip-offs

Fraud and Pharma: Inventory Control Tech Reduces Rip-offs 2400 900 Xcelpros Team

At a Glance

Making and selling fake versions of drugs for treating erectile dysfunction, high cholesterol, hypertension, cancer and other illnesses is big business.

  • $75 billion – $200 billion: The current annual revenue lost to counterfeiters
  • 13: The number of new drugs not produced in one year because of fake drugs

By the Numbers: Counterfeit Medicines

Reports by Outsourcing-pharma.com and Statista show just how much money counterfeit costs legitimate pharmaceutical manufacturers. Statista estimates the global market for fake drugs alone at $200 billion, accounting for 13 new drugs not being brought to market each year.

Other numbers of note include:

  • $100 billion – $431 billion: The estimated sales value lost to counterfeit drugs worldwide in 2020
  • 6–28: The number of new drugs not brought onto the market because of the effects of counterfeits through the impact on intellectual property rights
  • $103 billion (€92): The amount of money lost to European producers from 2012-2016 for counterfeit products including medicines
  • $19.45 billion (€16.5 billion): The amount lost to European pharmaceutical manufacturers, which was second only to clothing, footwear and accessories
  • 80,459: The number of pharmaceutical jobs affected by counterfeiters

Sources: Outsourcing-pharma.com, Statista.com

The National Crime Prevention Council has its own statistics on the cost of fake drugs:

  • 10%: The amount of all drugs in the global supply chain that are fake
  • 70%: The percentage of fake drugs in some countries
  • $75 billion: An estimate of global counterfeit drug sales from the Center for Medicine in the Public Interest quoted by the NCPC
  • 15,000: The number of illicit drug factories in India accounting for 75 percent of the world’s counterfeit drugs with other producers primarily in under-developed countries

Spotting a Fake

The Food and Drug Administration protects consumers from counterfeit medicines. “Drug safety and quality no longer begin or end at our border. The U.S. government works with foreign regulatory counterparts when possible to disrupt or close illegal operations involving the production and distribution of counterfeits,” the FDA states.

Figure: 1Identifying counterfeit medicine

Spotting a Fake pharma product

Identifying counterfeit medicine:

  • Packaging different that expected
  • New or unusual side effects
  • Medicine is available for purchase online

Resellers can protect themselves and their customers by only buying from authorized and licensed companies.

Resellers should also read the packaging. Potential fake products from unlicensed sources can be misbranded, adulterated, contaminated, improperly stored and transported, ineffective or unsafe, the FDA states. Some counterfeits have been spotted without a National Drug Code (NDC) number. Others have misspelled labels.

Among the medicines reportedly being copied and sold in the U.S. during the last five years are:

  • Symtuza ® from Janssen Pharmaceuticals (Dec. 24, 2020), used in the treatment of HIV
  • BiCNU ®, a cancer-fighting drug from Emcure Pharmaceuticals, Ltd.
  • Botox ® from Allergan
  • Cialis ® from Eli Lilly

Dangers of Using Counterfeit Drugs

Counterfeit drugs affect more than just legitimate companies: they harm people using them. Citing a 2017 World Health Organization (WHO) study, the OECD iLibrary states the effects on individuals of counterfeit medicines include:

  • Adverse—and possibly toxic—effects from incorrect active pharmaceutical ingredients
  • Ineffectiveness by not treating the targeted disease
  • Loss of confidence in health care professionals and health systems
  • Lost income by users from extended illness or death

The OECD report also referenced a 2019 Novartis in Society Report. Forensic tests of counterfeit medicine samples showing patients could be harmed by 90 percent of the counterfeits.

Fighting Counterfeit Drugs

Pfizer, one of the world’s largest drug manufacturers, supports the international “Fight the Fakes” campaign raising awareness of the dangers from using counterfeit medicines. Pfizer states that counterfeit versions of 105 Pfizer products were found in 113 countries. The company works with law enforcement agencies, wholesalers, pharmacies and others to increase inspection coverage, monitor distribution channels and use other methods to fight back.

One way pharmaceutical companies are fighting back is through the Drug Supply Chain Security Act (DSCSA). Enacted in 2013, the act requires manufacturers, contract manufacturers, repackagers, wholesale distributors and other meet compliance requirements.

A large part of this involves labeling.

For example, a warehouse receiving clerk can print labels after receiving raw materials but before putting them away.

Using Wave label printing, labels are available before workers run the work order on a mobile device. Workers then attach the labels during picking instead of after picking. Label printing options include:

  • According to the number of cartons on a single work line
  • With different sequences such as carton and pallet labels
  • Creating a unique serial shipping container code (SSCC) for each carton and including it on the label
  • Creating globally usable GS1-compliant numbers for bills of lading and SSCCs

Using Labels to Combat Counterfeiting

Among the labeling and packaging methods used to fight counterfeiting are holograms, 2-D barcodes, radio frequency identification tags (RFID) and packaging features that are either visible (overt) or hidden (covert).

NeuroTags, which makes these types of tags, states that it is easy for counterfeiters to make simple holograms and copy legitimate images. Luminescent topcoats revealing patterns and colors under special lighting are difficult to imitate, making it a good anti-counterfeiting solution for pharmaceutical products.

Smart Labels—also known as Smart Tags—have an RFID tag with a computer chip, antenna and bonding wires under a conventionally-printed barcode label. Among their benefits for the pharmaceutical industry—beyond being difficult to copy—is their ability to track temperatures. This is critical for some medications, such as the current Covid-19 vaccines from companies such as Pfizer and Moderna.

Another benefit of smart label technology is letting companies track items in real time. “It fulfills the requirement of tracking objects remotely, effectively, and most importantly at an affordable price,” Packaging Strategies.com states.

Combined with Microsoft Dynamics 365 Supply Chain Management, these types of labels make it difficult for counterfeiters to substitute cheap, ineffective and dangerous knock-offs for real medications.

D365 Supply Chain Management functions let companies track products from the moment raw materials arrive in the warehouse, through the production process and on to the sales floor.

Customers with equipment required to read the labels—and personnel trained in what to look for—will be able to distinguish legitimate goods from the fakes.

Summary

Counterfeiting pharmaceuticals costs the industry billions every year. It affects not only sales profits but intellectual property rights. Combining different types of labels such as Smart Tags with inventory tracking software lets pharmaceutical manufacturers know when real goods arrive at their destinations. It also lets them know when someone along the supply chain stole their products and replaced them with fakes.

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About XcelPros

XcelPros is a Chicago-based company delivering transformation through technology. We offer business and technology solutions with deep industry experience in Chemical, Pharma, Life Sciences (including Medical Devices, Bio-Medical & Biotech), Insurance, Discrete Manufacturing, Process Manufacturing, Distribution and Food & Beverage.

XcelPros is a Microsoft Gold Partner, Direct Cloud Solutions Provider (CSP) and a Systems Integrator (SI) offering software licensing, implementation and consulting services for Microsoft Dynamics 365, CRM, Microsoft Dynamics AX, Business Intelligence & Analytics (Power BI), SharePoint, Office 365 and Azure (Cloud, IOT, Microsoft Flow amongst many others).

Our mission is to provide integrated technology solutions that amplify impact and empower our customer’s businesses. We believe technology is the key enabler of exponential growth for us and our customers.

Contact XcelPros today to transform your business.

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warehouse management techniques

Warehouse management techniques in 2021: Tips to increase efficiency

Warehouse management techniques in 2021: Tips to increase efficiency 1202 451 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 free consultation to learn how.

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About XcelPros

XcelPros is a Chicago-based company delivering transformation through technology. We offer business and technology solutions with deep industry experience in Chemical, Pharma, Life Sciences (including Medical Devices, Bio-Medical & Biotech), Insurance, Discrete Manufacturing, Process Manufacturing, Distribution and Food & Beverage.

XcelPros is a Microsoft Gold Partner, Direct Cloud Solutions Provider (CSP) and a Systems Integrator (SI) offering software licensing, implementation and consulting services for Microsoft Dynamics 365, CRM, Microsoft Dynamics AX, Business Intelligence & Analytics (Power BI), SharePoint, Office 365 and Azure (Cloud, IOT, Microsoft Flow amongst many others).

Our mission is to provide integrated technology solutions that amplify impact and empower our customer’s businesses. We believe technology is the key enabler of exponential growth for us and our customers.

Contact XcelPros today to transform your business.

Call us toll-free – 1.855.411.0585 (or) visit www.xcelpros.com

Managing Pharmaceutical Discounts, Rebates Chargebacks

Managing Pharmaceutical Discounts, Rebates and Chargebacks

Managing Pharmaceutical Discounts, Rebates and Chargebacks 1200 450 Xcelpros Team

Introduction

The way pharmaceutical firms price their drugs and administer rebates and discounts, has put the industry in a potential governmental spotlight.

Key topics likely to be investigated include:

  • How discounts are set
  • How drug makers establish and monitor rebates
  • How pharma firms report their pricing details

Background

Around the world, pharmaceutical manufacturers are under increased pressure from governments and the public to reduce consumer drug prices. In some cases, the amount consumers pay for medicines has skyrocketed. One example cited by Endocrine.org is the cost of an insulin dose rising from $170 in 1987 to more than $1,400.

A 2019 Time magazine article attributes rising consumer drug costs to a complex drug supply chain. Pricing is set by a combination of pharmaceutical manufacturers, pharmacy benefit managers (PBMs) who serve as middlemen, and insurers.

Typically pharmaceutical companies set a non-discounted “list” or base price for each product. Many pharmaceutical companies offer discount coupons and rebates. Depending on a consumer’s health insurance coverage though, some patients may be forced to pay the undiscounted list price for specific medications.

According to Time, manufacturers provide discounts based on the drug and the buyer. Typically these discounts are in the form of rebates negotiated with individual PBMs. The PBM gets paid for its efforts to reduce the amount the manufacturer charges. The final price—which may or may not include any rebates or discounts—is then passed to the insurance companies, who in turn pass the pricing on to consumers.

In addition to negotiating pharma rebates, PBMs also wield power by determining where a particular drug appears on an insurance company’s hierarchy, Time states. These middlemen can make a given drug the most discounted, and therefore most prescribed, medication. They can also exclude it, forcing patients who want or need it to pay more.

Prescription drug price negotiations often happen behind closed doors, leaving patients and physicians out of the discussion despite the impact drug pricing has on the health and treatment of patients,” The American Medical Association (AMA) stated in a 2019 online article on how prescription drug prices are determined.

Raising the price of prescription drugs forces patients with limited funds to skip doses, split pills or abandon treatment, the AMA states. All of these actions, plus growing demands for prescription drug price reforms, are causing the U.S. government to further examine medicine prices.

Figure: 1Percentage of Revenue Spent on R &D

Importance of change management in erp implementation

Governmental Scrutiny

Federal government agencies such as the Department of Health and Human Services (DHHS) are paying extremely close attention to how much consumers actually pay. Agencies want to know if the actual prices reflect the research and development (R&D) and other costs of creating and manufacturing new products. Or are consumer prices a way for an unscrupulous company to use its hot new medication as a way to boost profits and stock prices?

The Biden Administration froze drug price reforms started by the previous administration pending further review. One reason for reviewing these proposals is the fear of higher insurance premiums, an online article by Joshua Cohen in Forbes states.

Cohen suggests that the Biden Administration may require health insurers “disclose current list prices and historical net prices for prescription drugs and provide patients with personalized estimates of cost sharing.

Figure: 2Amount of Revenue Spent on R &D

Amount of Revenue Spent on R &D

Setting Discounts

One way pharma companies can protect their integrity is by using Enterprise Resource Planning (ERP) software such as Microsoft’s Dynamics 365. ERP software allows pharmaceutical manufacturers to set various discounts and rules for each price break. For example, one rule in Dynamics 365 Commerce asks, “is a coupon required to obtain a discount?” A slider lets authorized users select Yes or No. When this feature is active, the discount only appears when a coupon or bar code is provided. This section also has “All discounts” and “Pricing and discounts management” workspaces, letting companies create customized discounts.

ERP software works by creating a series of properties for simple pharmaceutical discounts and quantity price breaks. For example quantity tiers must be reached independently for each line or product.

Microsoft Dynamics 365 Commerce lets companies select between four types of discounts: “Discount,” “Quantity,” “Mix and match” and “Threshold.”

Users also have the option to determine which discounts compete on a transaction. Values are “Exclusive,” “Best price” and “Compound” with “Exclusive” always being calculated first.

Individual products or product variants can be selected along with categories, units of measure and many other variables. Other options include setting up sales lines and invoice discounts.

When there are issues with drug quality, the “Quality management” section establishes rules for pharmaceutical chargebacks.

Managing Rebates

Microsoft’s Dynamics 365 Supply Chain includes a “Rebate management module” with an important feature for pharmaceutical companies. “The setup on this page is shared across all legal entities and can be modified by users who have the appropriate security permissions,” Microsoft states.

This module makes it easy to create contracts, deals and agreements with customers and vendors. It lets firms calculate and keep track of rebates, deductions and royalties. The information is stored in a central location for easy review.

Rebates can be created for customers or vendors. The function also allows inputting notes about a specific deal. For example, a pharmaceutical rebate may be given to one company instead of another. A note can explain the reason like a long-standing business relationship.

Since pharmaceutical rebates appear to be a likely focus of government action, documenting a firm’s rebates makes it easier to show what is taking place.

Reporting

With transparency being a likely focus of governmental action on drug pricing, investigators may ask to see pricing reports. ERP programs like Dynamics 365 have a number of powerful reporting features. A Report Wizard lets users select from a series of previously created reports and update them. Tables and charts can be included.

A big part of Dynamics 365 Supply Chain is tracking the status of each rebate for reporting and inquiry purposes. Reports can be linked to web pages, static files and dynamic Office-based files that read data from a Dynamics 365 database. Reports are filtered using SQL or FetchXML queries depending on the software in use.

Summary

Consumer drug pricing is becoming a hot topic in Washington, D.C. Pharma manufacturers are likely to face increased scrutiny on how they set pricing. ERP programs like Microsoft’s Dynamics 365 let firms set and track rules for discounts and rebates, as well as generate all necessary reports.

Get a free consultation on how to manage pharmaceutical discounts in dynamics 365 supply chain management.

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About XcelPros

XcelPros is a Chicago-based company delivering transformation through technology. We offer business and technology solutions with deep industry experience in Chemical, Pharma, Life Sciences (including Medical Devices, Bio-Medical & Biotech), Insurance, Discrete Manufacturing, Process Manufacturing, Distribution and Food & Beverage.

XcelPros is a Microsoft Gold Partner, Direct Cloud Solutions Provider (CSP) and a Systems Integrator (SI) offering software licensing, implementation and consulting services for Microsoft Dynamics 365, CRM, Microsoft Dynamics AX, Business Intelligence & Analytics (Power BI), SharePoint, Office 365 and Azure (Cloud, IOT, Microsoft Flow amongst many others).

Our mission is to provide integrated technology solutions that amplify impact and empower our customer’s businesses. We believe technology is the key enabler of exponential growth for us and our customers.

Contact XcelPros today to transform your business.

Call us toll-free – 1.855.411.0585 (or) visit www.xcelpros.com

D365 supply chain demand forecasting helps Chemical Industry

How Dynamics 365 Supply Chain Demand Forecasting Helps Chemical Companies Plan for Inventory

How Dynamics 365 Supply Chain Demand Forecasting Helps Chemical Companies Plan for Inventory 2400 900 Xcelpros Team

At a Glance

  • Accurately forecasting customer demands allows a company to quickly adapt to changing needs. Leveraging predictive analysis of historical data in demand forecasting models permits better understanding of what customers want.
  • Chemical industry decision-makers and inventory managers are now concentrating on short- and long-range demand fluctuations caused by price volatility and changes in supply chain dynamics.
  • Top executives can make insightful decisions driven by informed analysis of demand patterns using robust Supply Chain Management (SCM) tools.

Understanding Demand Forecasting

Demand forecasting uses predictive analysis to gauge customer demand patterns based on historical data. Historically, chemical companies use demand forecasting to gauge independent and dependent sales orders. Rapidly increasing global markets and integrated business models show a growing need for better responsiveness and flexibility in demand forecasting. Making these changes helps chemical companies:

  • Prepare shipping materials in advance for one-time and complete deliveries.
  • Manage inventory while being flexible to accommodate unforeseen demands.
  • Sense and predict product demand based on market hierarchy, geography, climate, time zones and other reasons.
  • Stand out in the market by consistently delivering at competitive prices.

Understanding historical demand and accurate inventory management plays a key role in forecasting sales. It ensures adequate inventory. Improperly managed inventory impacts everything from shipments to sales. Companies are very reactive about their inventory planning when resources are not allocated properly. Continually reprioritizing orders throws off historical demand tracking. Adding an unexpected order can lead to big problems.

A recent poll by Deloitte with chemical executives indicates that more than 20% of total US chemical sales will be driven by business-to-business (B2B) e-commerce in 2021.

Accurately forecasting inventory helps firms understand what they have. It also helps visualize the sales pipeline. With accurate demand forecasting, a plant can take measured risks and make informed decisions causing higher profits.

Demand Forecasting Challenges

Chemical companies often struggle to leverage huge volumes of data. Not understanding and using the data effectively can cause incomplete interpretations and communication errors.

The supply chain may have multiple stakeholders using different systems for enterprise resource planning (ERP), data management (DM) and supply chain management (SCM). Demand forecasting using these different systems often causes duplicate information and loss of crucial data.

Failing to use an integrated, sophisticated demand forecasting system limits a company’s ease of use and its ability to customize the software for its unique needs.

Figure: 1Demand Forecasting Challenges in Chemical Industry

 Demand Forecasting Challenges in Chemical Industry

Demand Forecasting in Microsoft Dynamics 365

Microsoft Dynamics 365 Supply Chain Management (SCM) helps businesses adjust forecasts and view key performance indicators (KPI’s) more efficiently. Companies using this product can see demand trends and then adjust forecasts. The new forecasts seamlessly are used in inventory planning. By removing outliers, Dynamics 365 enables accurate measurements.

Dynamics’ Supply Chain Management tool follows a comprehensive flow for demand forecasting:

  1. 1.System gathers historic transactional data.
  2. 2.Machine learning uses the data to generate forecast and insights.
  3. 3.Collected data provides forecast visibility while allowing forecasts adjustments.
  4. 4.Approved forecasts are then authorized.

Figure: 2Demand Forecasting in Microsoft Dynamics: How it Works

Demand Forecasting in Microsoft Dynamics: How it Works

Microsoft Dynamics 365 SCM helps manage these complex demand patterns and improve inventory planning. Its features include:

  • Integrating Planning Optimization using demand forecasts to make informed decisions for master plans.
  • Creating, generating or importing the demand forecast based on operational models and company requirements.
  • Customizing demand forecasts that streamline the process by reducing intercompany orders and considering customer forecasts.
  • Increasing accuracy and margin with lean demand forecasting.
  • Graphing and creating interactive demand forecasts for real-time feedback anywhere on the trend line.
  • Seamlessly applying the demand forecasting tool with existing ERP. This harnesses data and generates accurate forecasts for improved inventory control and bottom lines.

Chemical companies can better predict demand by fortifying their IT infrastructure with the right tools. Using software that’s easier to use, more accessible and has greater accuracy enables them to improve their inventory planning. Integrated solutions like Microsoft Dynamics 365 provide a robust and complete demand forecasting tool, enabling businesses to set up and maintain optimal inventory control.

Key Takeaways

  • Demand forecasting in the chemical industry needs to move forward from conventional, spreadsheet-based models and tools to newer, more agile digital systems.
  • Microsoft Dynamics 365 offers chemical companies the ability to forecast inventory levels more accurately through visual, customizable and interactive features.
  • Increased focus on accurate demand forecasting helps chemical companies avoid stock-outs or over-stocking. It improves profits, strengthens supply chains and elevates overall customer satisfaction.

To learn more about implementation of demand forecasting in your chemical company, book a free consultation with Xcelpros.

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About XcelPros

XcelPros is a Chicago-based company delivering transformation through technology. We offer business and technology solutions with deep industry experience in Chemical, Pharma, Life Sciences (including Medical Devices, Bio-Medical & Biotech), Insurance, Discrete Manufacturing, Process Manufacturing, Distribution and Food & Beverage.

XcelPros is a Microsoft Gold Partner, Direct Cloud Solutions Provider (CSP) and a Systems Integrator (SI) offering software licensing, implementation and consulting services for Microsoft Dynamics 365, CRM, Microsoft Dynamics AX, Business Intelligence & Analytics (Power BI), SharePoint, Office 365 and Azure (Cloud, IOT, Microsoft Flow amongst many others).

Our mission is to provide integrated technology solutions that amplify impact and empower our customer’s businesses. We believe technology is the key enabler of exponential growth for us and our customers.

Contact XcelPros today to transform your business.

Call us toll-free – 1.855.411.0585 (or) visit www.xcelpros.com

Why Do ERP implementations Fail? Key Points to remember for a Successful Transformation

Why Do ERP implementations Fail? Key Points to remember for a Successful Transformation 1550 750 Xcelpros Team

Introduction

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.

Source: IDC, 2019

The Business Story

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.

Plan the Move, but Execute Rapidly

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:

  • Deploying one solution to manage financials, sales, services, and operations.
  • Connecting apps like payroll, banking apps, CRM systems, e-commerce, or customer APIs.
  • Creating quotes, orders, and invoices right from Outlook and get tasks done on the go with mobile apps.

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.

ERP Assessments

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.Source: Gartner

Why do ERP Implementations Fail?

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.-SoftwareAdvice.com

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.

Safeguard the ERP Deployment and Minimize Post-Go-Live Issues

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:

Define objectives and goals

Analyze key Performance Indicators (KPIs) to help track the critical purposes of ERP implementation, such as supporting organic expansion and transparency in operations.

01

Identify best-fit vendors

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

Agree on the methodology

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 the features

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

Feed relevant data

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

Training and change management

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

Testing

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

Understanding an Enterprise Resource Planning System that Works for You

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:

  • Inventory Management
  • Accounting
  • Order Management
  • Supply Chain
  • Customer Relationship Management
  • Human Resource Management
  • Product Lifecycle

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

  • Handle, store, and transmit data securely across your systems
  • Protect information from unauthorized access with automatic Microsoft datacenter encryption
  • Control access to personal data and implement audit trails to ensure security and accountability

How does the Microsoft Ecosystem Help?

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 O365, 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:

  • Drive productivity by reducing time spent switching between stand-alone apps.
  • Foster collaboration and communication by breaking down internal silos and broadening visibility across the organization.
  • Accelerate user adoption and lower training time with a seamless user experience.

Key Takeaways

  • Before kicking off the implementation, the management and stakeholders involved need the right information on their role for Project success. Another essential element is to find the right internal champion who can manage user expectations without jeopardizing the objectives of the implementation.
  • A well-planned and coordinated ERP implementation where the implementer and client are on the same page can make the project a lot easier to bring to completion. In contrast, an unplanned ERP can disrupt your whole business process and cause huge losses.
  • It helps in setting the right expectations early, and understanding what to expect so that you can save time and effort and take your business to new heights with the proper ERP implementation.

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). 

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About XcelPros

XcelPros is a Chicago-based company delivering transformation through technology. We offer business and technology solutions with deep industry experience in Chemical, Pharma, Life Sciences (including Medical Devices, Bio-Medical & Biotech), Insurance, Discrete Manufacturing, Process Manufacturing, Distribution and Food & Beverage.

XcelPros is a Microsoft Gold Partner, Direct Cloud Solutions Provider (CSP) and a Systems Integrator (SI) offering software licensing, implementation and consulting services for Microsoft Dynamics 365, CRM, Microsoft Dynamics AX, Business Intelligence & Analytics (Power BI), SharePoint, Office 365 and Azure (Cloud, IOT, Microsoft Flow amongst many others).

Our mission is to provide integrated technology solutions that amplify impact and empower our customer’s businesses. We believe technology is the key enabler of exponential growth for us and our customers.

Contact XcelPros today to transform your business.

Call us toll-free – 1.855.411.0585 (or) visit www.xcelpros.com