ERP Mentoring

Ask anyone anywhere who has accomplished anything, the proof is there, if you know what you are looking for.  Ask a professional sports player how they perform at such a high level.  Ask a professional sports player why they have a coach, after all they typically have been doing the same sport since they were a young child.  What more is there to learn?  At some point don’t they know it all?

What is it that you want to accomplish and is it realistic in the time frame and budget you have set?

If you want to achieve more, then you need to associate with someone who has fruit on their tree in the area of your need.  Someone who has succeeded and has experience with the challenges you expect to have and the hurdles you are not even aware of.

When settlers started expanding west (here in the United States for my foreign readers) they looked for guides that knew the territory they would travel, the challenges they would likely encounter and knew which resources they would need.  How long would the trip take?  What would they experience?  Had anyone else been successful?  How would they know when they were “there”?  It was a big land and easy to get lost.

Enterprise Resource Planning (ERP) solutions have similar challenges for businesses and equally challenging objectives for the solution providers.

• What is working now?  What is not working?  Why? 
• Have you mapped out your processes?
• Do you know what makes money and what increases overhead?
• What amount of budget have you allocated to an ERP project?
• Who are the stakeholders?  Who makes the final decision?
• What would it cost you if you did nothing?

How long can you remain competitive if you continued doing what you always have done in the way you have always done it?

One of the biggest challenges businesses find themselves having to navigate when they make a decision to start looking for a new solution or upgrade, is what is it exactly that they do and how do they do it.

It really is a necessity to map out the existing business process.

Customers.

How are customers found and serviced?  You know, the people or organizations that actually buy the “stuff” you provide.  Where are they located?  What do they buy and when?

How do you manage their credit?  You are their supplier.  How do they communicate with you and how do you keep them up to date? 

What tools do your customer service people have available to answer the questions from your customers?  What tools do you provide to let them self-serve their needs? 

Products and Services (Stuff).

How do you stock and deliver that stuff?  How do you know how much stuff to keep on hand and how do you find it?  Do you know how much stuff you have now and where it is located?  How do your people find it, pick it, and ship the right stuff?  What does it cost if you ship the wrong stuff or the right stuff to the wrong customer?

What tools do your procurement people (buyers) have to identify what needs to be ordered and when?  Do you buy based on supplier deals or customer demand?  Do they guess what is needed?  Do they walk around and use an educated guess?

Suppliers and Vendors.

Where do you get your stuff or the material to make your stuff?  How do you know what to purchase and when?  How much is too much?  How long does it take to get more stuff?  Do you drop ship any of your products?  Are you being billed the right amount?

How do you generate a forecast and keep in touch with the organizations that ultimately enable you to deliver your solution or finished product to your customers?  How do they need to get paid?  How do you manage your credit?

Employees and Labor.

How many people does it take to service customers?  How many to pick, pack and ship orders?  How many people to run your finance department?  Procurement?  Warehousing?  Production?  How often are you on-time or late on customer deliveries?  Do you have sales people on the road?  How many locations do you need to coordinate?

A big clue that you should be looking for a new solution is when you start adding people and you do not gain an equivalent amount of productivity.  For example, you have 10 people in your warehouse.  You add two more.  You might expect 20% more productivity and you do not even come close to that return. 

In fact the inefficiencies in your operations just absorbs the extra labor capacity.

There is no magic pill.

No simple article is going to solve your challenges.  Likewise, no volumes of information are going to transform your operations.  There is too much information and too little experience to sort through it all to find the pieces you need, that relate and fit your organization.

A sales person is not the first one you should start with.  It is not that they are not intelligent.  It is not that they do not know about the solution they represent.  It is not that they do not know about competitive solutions. 

The issue with sales people is that their goal is sales.  After all is that not what you want your sales people to do?  They are needed and there is a time and place for them.

What you need most is a mentor and coach, often referred to a Trusted Advisor.  What is their goal? Is it your solution that addresses your critical business needs?  First and foremost the trusted advisor’s responsibility is to help you identify your business process, how you operate and what options are available within your budget and most of all what is reasonable and achievable.  You may want to have 100% accurate inventory, but that might not be possible.  You may want to ship more products with less people, but what investment would be necessary to make that happen?

A note of caution regarding people involved in the decision process.  When taking inventory of the stakeholders in your operations, the more people that are involved in the decision the less consensus there will be.  It is not linear, the lack of consensus will be exponential in growth with more people involved.

MaaS – Mentoring as a Service.  It is what we do.

Your challenges are important to you and your business.  More than likely they are not unique in your industry.  Dolvin Consulting provides business consultation services that can be used to help you navigate the sea of change.  We leverage our industry and business relationships to help you identify your challenges so that we can find a solution together.  Please contact us today to see how we can help.

Information is Cheap

Information, once highly valued, has become a very cheap commodity. 

Thanks to the interconnected world and web browsers, just about anyone with an Internet connection can find out just about anything at any time.  Connection is provided in so many ways today with so many devices providing access.  Information resources often number in the thousands or hundreds of thousands or even millions. 

“ERP Software Solutions” returned 4,850,000 results during the writing of this posting.  If you really wanted valuable information, it is available.  This information is available for the most part at no-charge or the dreaded word “Free”.  Each and every day the time equivalent of more than eight years of video information is uploaded to YouTube.

What information will be of value?  Which piece of information helps solve your problem?  Do you even know where your problem lays?

Anyone who has been around a while knows the true value of free.  Either it is worth what it costs or it is of little value. 

With so many resources available much pressure exists for the suppliers of information to position their resources high on search engines creating a potential conflict of interest of genuine information of value and the quest for income.  Everyone screaming look at me, look at me.

In general we love having choices and having so much information available, but how can we apply it to our decision making?  What happens if we really need the information to transform our businesses?  We seek more and more of it, not less.  How can we filter what we need with what we have available?

This information quest applies both in external resources and internal management of business operations.  Information is key.  Not knowing where you are going leaves you nowhere.

We are now at the point where Internet Librarians have become the valued resource.  It is not enough to know the answer to a question.  The Internet is full of answers. 

The key is knowing the questions and how to apply the answers to your real world challenges.  

Business Technology consultants have become that well needed resource.  It is important to understand the difference between Managed Service Providers (MSP) which provide the resources, monitoring and support to keep your business operating versus Business Technology Providers which consult as trusted advisors to guide you into the future.

At their core all Enterprise Resource Planning (ERP) solutions for Manufacturing and Distribution are designed to help companies manage inventory more efficiently.  All of the modules and add-ons have that imbedded in their design, either directly or via a supporting functional role, such as Finance. 

The Supply Chain’s needs have not changed since the beginning of distribution services.

Wikipedia defines Supply Chain Management (SCM) as "the systemic, strategic coordination of the traditional business functions and the tactics across these business functions within a particular company and across businesses within the supply chain, for the purposes of improving the long-term performance of the individual companies and the supply chain as a whole”.  It has also been defined as the "design, planning, execution, control, and monitoring of supply chain activities with the objective of creating net value, building a competitive infrastructure, leveraging worldwide logistics, synchronizing supply with demand and measuring performance globally."

If the challenges of the supply chain have not changed significantly over time and there is ever more information available, then what is the problem?  The answers exists.  In fact the ratio of answers to question have exponentially increased.  Every business should be running great.

What we now need is help with our questions. 

Action is the answer to the question you are asking now.  That is where opportunity to advance lays. 

What actions can I take now that will help me run and operate my business more efficiently, lower my costs and be more competitive? How do we learn what questions to ask to get the answers we need?  How do we incorporate this new philosophy?   How do we get the best information to the people who need it most?

How do we deliver on the promise of results?

Dolvin Consulting has the experience, resources and contacts to help you find the right questions to the answers you need.  Contact us today for help, which is why we are here.

Time for Help

What keeps you up at night when you are in charge of technology delivery for your business?  Every company struggles at some point in time.  At different periods of growth and contraction, struggle is part of the process.

Struggle is normal. 

The theory goes that Enterprise Resource Planning (ERP) solutions are designed to integrate the entire business (i.e. the Enterprise).  The more this is embraced and the more departments or functional roles that are integrated in your solution the more efficient your operations could be. 

Okay, makes sense right, purchase an ERP solution, install it, migrate your information, train your people, and start saving lots of money, buy a boat and relax.  But what if you already have an ERP solution?  What if you have more projects than budget?   Where are the savings you thought you were supposed to have?

Savings are potentially there, but like a sculptor, you need to uncover them. 

Where most companies start is inventory.  Even small reductions in inventory levels have the potential of improving the bottom line.  Small is relative, but think in terms of two to three percentage point drop in levels.  Cutting your inventory in half is not realistic.  It would cripple your business, but a small drop of a few percentage points is realistic and achievable.

The other area that works hand in hand with inventory levels is high accuracy.  It is the other side of the coin and cannot be separated.  There are several ways to measure accuracy, but most practical is the count.  Is what you have on the shelf the same as what you have in your inventory system?  How close these two numbers are is a measure of accuracy. 

The ultimate goal is 100% and that may or may not be realistic, but 97/98% or higher is where you need to be headed.

I know of a company that had 100% accurate inventory every month, but only one day a month, once a month.  When they did a complete physical inventory count each month, it was accurate, at that time.  Then it was off the rest of the month.  They did not have an inventory control system. 

For some companies it is the same or similar story.  They only know what they have when they count it or when they do not have it.  Out of stock equals zero and that is accurate, but not good when a customer orders it.  Their systems have not kept up with their business and the problems have cascaded from there. 

The Inventory Control module name implies that you will have control of your inventory once you install it.  In most places the inventory is in control instead of the other way around. 

You in fact must trust the system to do what it is designed to do, but that is hard to do when there is no confidence in the system.  When that happens people do just about anything to bypass and avoid the very solution that is designed to help.

The Inventory Control module is intended to do is give you observability.  Warehouse Management Systems (WMS) are designed to monitor the movement of inventory from reception, to put-away, counting, and pick-pack-ship. 

WMS solutions are usually separate and do incur additional investment, but make sense, because it provides the tools to effectively manage inventory.  By monitoring the movement of inventory you do add a level of effort, but the payback is in accuracy and people actually using the system you paid for and depend on. 

When your workers actually find the inventory the system says should be there in the place it says it should be, then their confidence increases.  That increased confidence leads users to use the system more. 

Most people do not mind using a system that actually works and helps them do their job.  Trusting and using the system are critical components to building accuracy. 

Accuracy is key to driving profitability. 

With an accurate system, procurement orders the right amount of the correct products.  Customer service can accurately answer customer questions and concerns.  The Finance department can process transactions and produce financial reporting more quickly and accurately.   

There are a lot of intricacies of implementing and actually using both an Inventory Control and Warehouse Management System properly.  Books have been written on the subject.  The purpose of this writing is not to tell you how, but to give you confidence that you can have accurate inventory, you can trust your system and you can generate savings. 

Any benefit comes after effort. 

These systems work, if you trust them to do what they are designed to do.  Dolvin Consulting works with manufacturers and distributors to help them understand and implement their inventory systems.  Contact us today to see how we can help.

Please share your success and failure stories here with the rest of our readers.  You story counts.

Cycle Counting (Part 2): Tips for Choosing the Right Inventory Software to Support It

How accurate are your inventory records? It’s a question you've probably asked yourself on more than one occasion.  It is what every organization that handles inventory struggles with at one level or another, at one time or another, and coincides with automation and efficiency efforts.

Changing from Annual to Cycle counting does take some planning, but the long term benefits may well be worth the effort.  It also something that may need to be approved by your board or other regulatory body depending on your industry.  

We have found that many businesses need to do both Annual and Cycle counting until they show a consistent accurate inventory for at least one year.  After that time period the annual counting can be discontinued.  It is important that you demonstrate good accounting controls and financial reporting.

Please read the article series below to find out more.

Find Accounting Software continues their 2-part series and answers some additional questions about cycle counting.  Find Accounting Software has some great resources to help you navigate through the sea of change.  Read on for more information.

 

Tips for Choosing the Right Inventory Software to Support It

Where are you struggling?  Do you know how to get started?  What you should count and when?  What approach will you take?

At Dolvin Consulting we work with your team to find solutions that drive efficiency and automation in your operations.  Working solutions that are just-right for you and your business.  Contact us today to see how we can help.

Cycle Counting (Part 1): What Every Inventory Manager Should Know About It

Are you finding variances in your inventory counts no matter how hard you try, no matter what controls are in place?  Enter the Annual Physical Inventory and all the prep work, resource allocation, overtime, headaches and putting business on hold while you try to lock down your inventory during counting.

Are you considering cycle counting in addition to or as a replacement to an annual physical count? 

Please read the article series below to find out more.

Find Accounting Software starts their 2-part series and answers some important questions about cycle counting.  Find Accounting Software has some great resources to help you navigate through the sea of change.  Read on for more information.

 What Every Inventory Manager Should Know About It

Where are you struggling?  Do you know how to get started?  What you should count and when?  What approach will you take?

At Dolvin Consulting we work with your team to find solutions that drive efficiency and automation in your operations.  Working solutions that are just-right for you and your business.  Contact us today to see how we can help.

Life Cycle Part Two

Nature duplicates life we create or is it really that the life we create duplicates nature.  It really makes sense if you think about it, because we tend to replicate our environment in the way we live, learn and grow.  Last time we looked at the life cycle of ERP solutions with a comparison to Sunflowers and plant life.  Sunflowers are an interesting plant.  The flowers follow the sun through the day, supply food for birds and animals in their replication cycle.  Their plant-life-goal is to mature, grow and plant the seeds for the next generation. 

Dragonflies are also interesting in general and in their similarities to ERP solutions. 

First there are some 5000 varieties of the species.  There are a lot of Enterprise Resource Planning (ERP) solutions too.  

Each solution has its benefits, limits and niche where they work best. 

Dragonflies start as larvae in water where they spend the bulk of their life.  The early stages of ERP is often a developmental stage where a lot of the work is not seen and includes implementation, migration and training to fully take advantage of the service offerings.  

The winged version of dragonflies are what most of us are familiar with and comes after growth and trials and struggles to survive.  Once mature there is the need to stay alive, stay current and continued growth.  This is similar to ERP as more and more function is utilized in the solution and give need via growth and life cycle to a new generation. 

The next generation is inevitable. 

That next generation can be an upgrade or new solution, but it will come.  No new generation and the solution will eventually wear out and perish.  

Business needs and cycles change and ERP solutions need to change and adapt to the way your customers prefer to do business.

Choosing an upgrade or new solution is not always an easy task even if what is currently in use does not work.  Decision makers need to decide if they want to keep a narrow focus on their industry such as manufacturing, distribution or application like order entry.  Or, the decision makers need to take a more broad view of their applications and embrace the ERP moniker and include more functional roles such as customer service management which would include order entry, inventory, procurement, and manufacturing applications, like capacity planning, in one big picture.

Enterprise solutions are optimized to maximize their return when the entire enterprise is integrated.

Industry solutions are an important grouping of applications that are used and optimized for specific industries such as retail, wholesale distribution, or manufacturing.  Decision makers now have to consider traditional on premise or hosted solutions as well as more traditional questions.

Some questions to consider:  

How long has the particular software been used and how successfully? 

Total cost of ownership (TCO) is an important factor.  Most people realize that the initial upfront costs are often outpaced by the ongoing administration and operational costs. 

What initial costs must be absorbed in your return on investment (ROI) calculation?   Hardware for on premise, software licensing, maintenance, support, implementation, migration, and training?

What type of support is available?  On line, documents, phone and what time windows?

What skills are needed?  Who will provide training?  Train the trainers?  How much time will it take to get your staff up to date?  Which modules will you activate and in which order?  Do you need to know how to run everything all at once or can you train as you go after having covered the basic modules first?

Should your solution be an open-source solution or is a proprietary solution better?  What size provider is right for your business?  Are you a global organization?  Do you need a global solution? 

An open source solution may seem like a winner especially with lower license fees, however, getting support may be limited or a challenge when you get locked into a custom solution that few outside of the solution provider know how to support.  A proprietary system actually can be more “open” in the sense that people that know how to support the system will have knowledge of how to support any solution running on this same platform. 

Regardless there may be nothing worse than having a solution that is not a fit for the culture of your organization and how your customers prefer to be served.

Maturity of the solution may be a more important factor that what platform they run on.  How responsive is the solution provider to listen and understand the nuances of your operations?  Or, do they just want to pack you in a box that “works” and hope you can manage the internal changes needed to fit their mold.

Conversely, be wary of too much customization.  An over eager solution provider that will customize everything will equally box you in.  With so many customizations, how will you take advantage of new releases?  How will they keep you current with industry trends?  

Too many modifications either means the solution is not the right fit for your organization or you have highly unique business requirements.

Where will you get support?  Will it come from, is it available directly from, the solution creator?  Are there local dealers with expertise that can be onsite to help?  How many of your staff will need to be trained in support? 

It is one thing to purchase a solution, it is entirely another matter to maintain it.  Like our dragonfly, your ERP solutions need regular tending-to, environment, and opportunity to grow.  Likewise it also has to be protected from and fend off predators.  A dragon fly starts small and is usually unseen until it has passed through various growth stages until it emerges mature and winged.  It is only then we see and appreciate its beauty and appetite for the insects it consumes daily.

Let Dolvin Consulting help you navigate to a new solution, upgrade or to feel comfortable with the solution you are already using.  Contact us today to get started.  We are here to help.

ERP Life Cycle

Enterprise Resource Planning solutions have life cycles, just as plants and humans have.  They differ in many ways and also have many similarities.

Sunflower plants follow the pattern of:

1. Existing mature flowers make seeds.
2. Seeds find fertile ground.
3. Seeds grow into new plants.
4. A young plant is a seedling and grows bigger.
5. The fully grown plant flowers.
6. The cycle repeats.

ERP software function as a business management solution and usually consist of a suite of integrated applications that a business uses to collect, store, manage and interpret data from many business activities, including: product planning, cost and development, Manufacturing or service delivery, marketing and sales, inventory management and shipping and payment.

ERP cycles through:

1. A business operates and spurs new growth.
2. New modules or third party solutions are added to address growth and the need to capture and manage additional streams of information.
3. Inefficiencies increase as growth outpaces capacity.
4. Separate systems are implemented to address growth.
5. A new solution or upgrade is implemented to address the new scope of business.
6. The cycle repeats.

There are a lot of definitions of ERP cycles. 

Most start with planning and package selection, then move on to implementation and then operation.  While these stages are true most companies are already in the middle step of operation mode.  The existing solutions can be a full ERP solution or a mish-mash mix of manual, spread sheet, or older solutions.  One of the biggest challenges are determining if the current growth is temporary or a sign of future activity.

What has changed?  What is driving the need to change?

Many factors stimulate change.  Growth, Mergers and Acquisitions are common sources as well as a new product or service lines or a myriad of other economic influences.  What becomes a driving factor is the incumbent solution worked at one level of business and was not able to scale up or down to address the new level of need.  The need could be to handle additional or a drop in transactions, new or a loss of business units. 

The need could be up or down, growth or decay.

Increased activity without a corresponding increase in revenue is a sign of inefficiency.  The higher overhead drains an organization’s resources.  In today’s business world automation is the key to sustained growth. 

When selecting a new ERP solution it needs to address the current needs, pains and anticipated growth.  Many organizations concentrate on the current needs and how the proposed solution addresses their pain.  This is certainly a good starting point.  However, a good solution should also address future growth.  A great solution takes into account business cycles and can address both future growth and downturns.

There are seasons to business cycles just like plant life.  There is a nurturing point in time, growth, maturity and then the cycle inevitably repeats.  A lot of businesses forget this point.  What goes up comes down and with proper planning business goes up again.  Your solution must scale in the same way. 

• How is your solution designed to address future business cycles?  
• What downturns have your business triumphed through with your ERP solution?  
• What key components are you considering in your next solution or upgrade?  
• What cycles does your solution need to address?

Dolvin Consulting works with businesses in Manufacturing, Distribution and Specialty Retail to help them identify and address their growth pains.  Take a minute to post and share your successes and failures here with our readers.  Contact us to discuss your challenges.  We are your trusted advisor and want to help.

More Efficient Operational Processes

More efficient warehouse operations.  If only.  Is it possible?  If it were, there would likely be less labor costs relative to increased production.  Less costs and less production is clearly a down cycle in the business as is more costs and less production.  Ideally you want less costs and more production. 

Automation is the key.  But, automate what, how?

For most manufacturers and wholesale distributors the key often revolves around inventory levels, processing and handling.  Inventory tends to have the greatest Return On Investment (ROI).  Inventory management is somewhat like upgrading your kitchen in your house remodel.  The kitchen remodel generally returns the most on investment.  Other upgrades make living more comfortable, but Kitchens have one of the better paybacks.

Increased accuracy in order and pick/pack/ship processing due to warehouse layout optimization, receiving efficiencies including barcoding and scanning, automated put-aways and cycle counting are just a few examples that can contribute to more efficient operations.

Most businesses that have survived the economic fluctuations are running fairly well and have probably automated at least some and likely much of their facilities.  Warehouse Management Systems (WMS) are the key to the automation.  Unfortunately these systems are not always fully implemented.  Sometimes the implementation plan was a phased approach, but never completed.  Sometimes the organization had a loss of faith in the promised return.  The causes are many, a bad match between sales and purchasing, lack of education, or lack of funds to fully implement the solution. 

WMS systems are great, but they do have to match the business model.  Typically the greatest efficiency in WMS comes from a fully integrated solution that is part of the native Enterprise Resource Planning (ERP) solution.  However, if the ERP solution is not a good match, the WMS module will tend to exacerbate the problems.

A thorough review of business operations makes sense before purchasing or upgrading your WMS solution. 

Are there plans and budget available to outfit workers with wireless equipment, barcode scanners, printers, and other tools?  The benefits of WMS will be limited without the corresponding equipment.  Automating labor collection and reporting is another benefit of WMS systems.  A phased-in approach is a valid model as long as the implementation is completed.

How much paper is involved with the current processing of orders, receiving and counting?  How will a WMS system reduce this overhead?  Will your people be convinced?  What is the baseline and what metrics are needed to gauge the project success?  Without an electronic system how can workloads be optimized?  How much time and effort is needed to check orders? 

How much does the administrative overhead affect your profitability?

Achievable goals include year over year decreases in labor costs relative to production, order, pick and shipment rates of 99% accuracy.  To enable these accuracy levels organizations will typically need to implement bin management in their WMS system, real-time paperless receiving and put-aways, automated picking and cycle counting.  Manual systems require a significant amount of administrative overhead and paperwork which contributes to inaccuracies. These inaccuracies increase if batch, lot or serial number processing is involved. 

High accuracy rates are not the end goal, efficiency is.  High accuracy rates are what enables business to concentrate on real operational efficiency improvements. 

To get started, businesses need to conduct a business process review including evaluation of the incumbent and competitive ERP software including WMS systems, including any upgrades to their current systems.  This is only a start, but it is an important an unavoidable step in the right direction.

Buy-in at all levels in the organization is an important component to not be forgotten. 

Owners and/or management cannot just decide one day to push out a whole new way of doing business without proper training and education.  From the shop floor, warehouse, to the back office, management and top level personnel, everyone needs to understand that the change will help them to do what they do more efficiently and productively.  Set the expectations and gain consensus on the outcome. 

This is a real test for the leadership in the organization.  

How is your organization dealing with change, leadership and inventory challenges? 

Dolvin Consulting works with your team to identify and remediate the causes of inefficiency in your organization.  Contact us today to see how we can help. 

Two Signs ERP Changes are Needed

Most know that manufacturers, distributors and other midmarket organizations depend on Enterprise Resource Planning (ERP) solutions to increase productivity and deliver great customer support via an integrated information repository.  You know the analogy, the left hand knows what the right hand is doing, less errors, better performance, and faster access to business metrics.

 

There are many signs that you may have outgrown your ERP solution.  Every organization struggles at some point in time.  The struggles are equal during periods of growth and decline.  The economy is cyclical and so are business operations.

 

Below are two signs.  How many more affect you personally? 

 

Sign-One:  You increase your labor force and you do not get an equivalent increase in productivity.  The extra personnel just seem to be less productive. 

 

When your business grows it makes sense that you may need more people to interact with customers, process orders, handle procurement and finances.  It makes sense, doesn’t it?  Perhaps it does, but how many are necessary and how many are too much?  How many actually just increase overhead?  How many more do you need to manage the workforce?  Are you creating the need for an extra level of management?

 

If you double your warehouse work force, should you be able to pick, pack and ship twice the number of orders?  Should you be able to triple the number of orders?  What is the ratio of people to orders processed in your organization? 

 

If you actually ship twice the number of orders, how many customer service people does that translate to?  How many people do you need to add to the Finance department to handle billing and reporting needs?  How many more supervisors and managers are needed to address the increase in workforce. 

 

It might make sense to take a look at how your business is physically organized before you add people.  Not that you do not need more people, the real question is how many and where? 

 

For example, would arranging your inventory locations in a more efficient way for stocking and picking make more sense?  Would conveyors or barcoding or other form of automation increase productivity enough so that you can minimize hiring? 

 

In contrast suppose business has shrunk, how many roles can be consolidated?  How can you empower the remaining personnel with the right tools so that their productivity increases and you can maintain business operations and then prepare for the next growth cycle?

 

How efficient is the software you use to process information?  How many separate systems do you use?  How many steps does it take to enter an order?  How much time does it take?

 

 

Sign-Two:  You increase your inventory level and still have troubles meeting customer demand.

 

How much is too much inventory?  What are your customer’s expectations?  What does on-time delivery mean?  What delivery does your competition actually deliver?  Is there anything real about Just-In-Time (JIT) inventory?  Who do you know personally that can make that type of system work?

 

Manufacturers have lead-times for the products they produce.  Distributors need systems that build that lead time into their procurement process so that customer demand and sales history can be balanced to ensure that you have enough inventory on hand to meet expected levels with a reasonable amount of safety stock.  In other words, you can meet customer demand without overstocking your warehouse.

 

A purchase “deal” is not a deal if that inventory sits in your warehouse too long.  A special price so one business can basically dump their inventory is not a deal for anyone, if that inventory sits and takes up space.  Physical space, overhead, taxes all add up and can easily out-cost any purchase savings.  A deal is not a deal unless you have a customer ready and willing (and has the monetary resources) to buy the product.

 

Can you find your inventory?  Do you purchase more, because you cannot find what you thought you had?  How accurate is your current system?  What tools and processes does your current system have that helps to keep your inventory accurate?  How often do you have to count your inventory to know what you have on hand?  Is the only time you feel confident on your inventory levels is immediately after the counts have been posted?

 

There are numerous indicators of inventory inefficiency and tools and software to address the challenges and problems.  Most businesses struggle in determining just where the bottleneck is occurring.  Otherwise, they would have fixed it already.  The problem often lies deeper than the observable symptoms.  The alternative is equally pressing.  A business knows where the problem is, but lacks the resources to properly address the problem. 

 

Either way short term patches and fixes designed to address the problem will inevitably make the situation worse when a decision is made to make these fixes permanent without addressing the underlying issues.  Until you get to and address the heart of the problem, the problems will repeat.

 

 

So many questions and too few answers.

 

 

These two signs are just the tip of the iceberg.  What keeps you up at night?  You have questions and we have answers.  You may agree with some of these statements and disagree with others.  Why not share those thoughts here for your fellow readers.  I would love to hear what you think.

 

Dolvin Consulting works with industry experts to help your business identify and remediate the obstacles that are holding you back today.  Contact us to see how we can help.  Only you know how great the pain is and the impact it has on your operations.  We understand and can help.

 

Inventory Management Visibility

In order to make better decisions management needs good visibility into their inventory.  Financial, operational and purchasing decisions are better when based on accurate and timely information.  Elimination of manual processing increases the timeliness and reporting capabilities which overall increases customer service levels.

 

Customer service matters. 

 

What processes are being implemented at your organization to increase your customer’s satisfaction?  What improvements are your competitors making?

 

The right Enterprise Resource Planning (ERP) solution provides the framework for the different departmental functions to be integrated into one weave.  What makes “it” the right ERP solution?  There are many solutions to choose from today. 

 

It becomes the right solution when culture meats function. 

 

Every organization has a culture, a way of doing business.  Every ERP solution has a process which maps transaction and reporting functions to organization challenge.  The key is finding a solution that addresses the core needs while providing a growth path to future challenges. 

 

When manufacturers deal with inventory they typically will take advantage of a Manufacturing Resource Planning (MRP) module to manage how much inventory they have in their warehouses at any given time.  Real-time or near real-time reporting is optimal, and as a result better suggest how much of any particular inventory item to manufacture or purchase.

 

A consolidated view of historical usage allows both manufacturers and distributors to accurately project and plan for future need and create the optimal production or buying levels.  This accuracy allows the organization to react faster to changes in demand.

 

Companies need the visibility that ERP/MRP solutions provide. 

 

Monitoring and tracking inventory movement on the shop floor as well as in the warehouse allows organizations to plan better and minimize out of stock situations which results in better customer service and ultimately savings through automation and increased efficiencies.

 

Customer service should be a critical component for any organization. 

 

Take your own shopping or purchasing experience in mind.  How often do you like hearing “we can back order that for you” when you try to order supplies.  How competitive can your salesreps be if they have no clear idea of what is available when they are in front of your customers?

 

Greater inventory accuracy increases speed and efficiency.  Efficiency that purchasing, sales and customer service as well as production departments all take advantage of to perform their functions.  Management has the information they need to make decisions with greater confidence.

 

One of the bigger challenges is implementing the changes and new solutions needed with ERP solutions.   It is one thing to write or talk about solutions, it is quite another to commit to the changes.  Inevitably a lot of the effort should be made up front to document the processes currently being used so they can be addressed and mapped to a potential new solution. 

 

This is where the culture piece fits in.  How many steps does it take to perform a function?  A solution could be very capable, but take too much effort to achieve the advertised results.  This is also not to say that just because there are steps involved that they should be avoided.  Look for ways to automate the collection of information.  Even though there may be some additional steps involved compared to what you do now, the accuracy and benefits are usually worth the effort.

 

Making a change to an ERP solution is not comparable to picking box software of a shelf. 

 

It takes a lot of planning and analysis as well as fiscal commitment to implement an ERP solution.  Most people understand the potential benefits of increased inventory visibility and the efficiency of newer ERP solutions.  Many are concerned about the likelihood that they will have to change their operations or will have to make extensive modifications.  Neither is a good choice.  Unless there are unique requirements, you should be looking for a flexible solution that only needs minor modifications.

 

Look for solutions that provide consolidated dashboard views that give you drill-down to details.  Savings come in many forms, but typically involve automation of one type or another and the elimination of manual report processes.  Paper intensive tasks are other areas where organizations can achieve significant savings.  Planning decisions are more effective with accurate information. 

 

Make sure your system collects the right information.

 

Your competitive advantage starts with a comprehensive ERP solution that integrates your Enterprise.  Finding the right solution may take some effort, but in the long run, if you select the right solution you will wonder why you took so long to make the decision.

 

Let Dolvin Consulting help you find the right solution.  Contact us today to see how we can help you find the right solution for your challenges.

 

 

Distribution Success Essentials

Manufacturers and Distributors need to embrace, implement and utilize Enterprise Resource Planning (ERP) solutions in order to grow and thrive.   ERP solutions earn their place by primarily streamlining inventory and warehouse management operations.  ERP also incorporates customer service, procurement, sales analytics and forecasting for and from all of the users in an organization.

 

Yes, these concepts apply to manufacturing too.  Manufacturers have challenges in their manufacturing processing which ERP solutions can help to manage, but they must also distribute their products, they have customers and the same challenges as Distributors.

 

Inventory handling has to be streamlined. 

 

Inventory is the core of any organization that distributes products regardless if they are manufactured or purchased.  ERP solutions need to integrate the entire organization, but grew out of MRP systems that were designed to optimize inventory handling.  Technologies are continuously evolving to address new integration and handling challenges. 

 

The challenges are basically the same as they have always been.  It is the way we interact with inventory that has changed. 

 

Companies need inventory to process, they need orders to create planning, and they need customers.  Companies need to maintain supplier relationships.  They need to determine the right levels of inventory to meet demand, but not just take up space.  ERP Solutions need to address these challenges and provide observability to management, customer service, sales team, procurement and production departments.

 

Everyone needs to know their part of the puzzle.

 

Other areas that today’s ERP solutions must address include compliance regulations.  Your system must have the capability to record transactions and interactions, particularly in industries like food and pharmaceutical.  Business processing must be tracked and traceable.  Who touched it, for how long, what areas processed the inventory, what was the source and where did it go and how did it get there.

 

Customers, suppliers, and internal representatives are all interacting in different ways with the same goal.  Efficiency drives your organization.  They need real-time information and they need it now and are turning to Social media forums and mobile platforms.  Cloud or hosted solutions should be evaluated for fit and function.  Special caution should be evaluated to ensure that they do not introduce synchronization or compliance issues.  The feature and functions sound promising, but the integration can introduce errors and compliance complications.

 

When tying into social, mobile and cloud platforms the need for traceability increases, not decreases.  Just because another organization manages a platform, does not resolve your responsibility to meet compliance mandates, security issues increase and do not go away.  Plus you are adding integration challenges. 

 

This is not to say there is not value in these technologies, it is saying that they have to be approached with caution and due diligence.

 

Automation is certainly the key to streamlining operations and reducing and controlling costs. 

 

A good-fit ERP solution will have the tools and feature needed to automate your processes.  The more the better, but critical ones like inventory must come first and foremost.  Automation reduces the labor associated with data collection and analysis, reduces errors by eliminating manual processing, and frees up time for personnel to concentrate more on core business functions.

 

Ultimately any changes should have the end customer in mind. 

 

Nothing happens that is worthwhile if it does not increase efficiency both internally and externally, especially for your customers.  The customer is the one who writes the check for you product.   It is generally easier to keep an existing customer happy than to acquire a new one.  However, both are critical and your ERP solution must provide the means to service your customers better.  Whether that is done by implementing and Ecommerce solution for self service needs or better tools for your customer service department to answer their questions and concerns or the procurement department to better use forecasting to meet production and delivery demands.

 

Business needs change and evolve in the way we handle information even thought the challenges of the supply chain and customer service are fundamentally the same.  The way we collect and deliver the information is constantly changing.  An effective ERP solution must address your current needs and provide the forum to grow with you and your customers.

 

Organizations must endorse, embrace and incorporate new technologies in order to compete effectively. 

 

Solutions exist, but the challenge increases in selecting a solution that meets your needs, addresses current challenges, and will enable faster growth and grow with you.  There must be buy-in at all levels of your organization from top C-Level, Board members, and to all departments that comprise your organization.

 

Dolvin Consulting works with you and industry experts to help you examine your operations so that you find the right solution to address your specific challenges.  Due diligence and some hard work now will pay off in the future with streamlined operations, reduced costs and greater profits.  Contact us today to see how we can help. 

 

Your comments and suggestions are welcome.  Tell us what you think.

Streamlining Manufacturing Processes and Improving Inventory Management

Any organization that handles inventory at any significant level will struggle at one point or another with inventory control and warehouse management.  Operations start normally enough and growth is accommodated fairly well until a trigger happens.  That trigger can be any number of changes.  They may include a merger or acquisition, new product line, updated manufacturing, new demand or market penetration.

 

 

As business grows the need to address multiple customer and separate industry segments at the same time are examples of growth that many systems cannot handle well.  A given system may have been designed to work with a single industry and its unique needs, but may not scale well to accommodate new industry segments.

 

What happens when there are new lines of business that have different requirements?

 

It becomes increasingly critical to streamline and manage the massive amounts of information being transmitted and processed from various locations such as customers, billing departments, technicians, trucks, and more when hundreds of organizations in a variety of industries rely on your systems for its equipment and supplies services,

 

A common constraint in many older Enterprise Resource Planning (ERP) systems is their limited ability to efficiently and cost-effectively perform critical every day sales and service functions. 

 

These older systems tend to be very labor intensive and involve too much paperwork.  These constraints are multiplied when there is a mobile sales force that needs to have printed materials before traveling to customer locations.  This information has a tendency to go out of date quickly so that Salesreps would not have a clear snapshot of what products customers were using, what they were already billed for and what they already paid.  Delays in billing amplified the gap.

 

Recognizing that your current service billing and inventory processes are leading to increased costs is a first step in finding a solution that will reduce costs and streamline operations.  

 

You first have to recognize you have a problem before you can find a solution. 

 

Finding a system with real-time visibility of its data that has the ability to present it in a meaningful way is a critical step to moving forward and being more competitive.

 

To address efficiency issues companies need to find solutions that help to automate and integrate all of its ERP processes and provide an accurate, real-time view and control of the organization’s customer and inventory data.  Adding to the complexity are businesses that have manufacturing processing to integrate as well.  

 

Any new solution will certainly need easy deployment and real-time data discovery which will result in increased customer satisfaction.  Leveraging mobile technologies is often a key factor especially when a mobile sales force must be supported.  Mobility is important not only in extracting information, but also in updating the backend ERP system automatically.  Tasks such as invoicing can be done directly and automatically through handheld devices to eliminate the expense of time delays, postage and inefficient paper processing.

 

Implementation any new system can have its challenges.  When change is embraced in an organization the process can be seamless and quick.  Seamless integration of the entire organization will provide a seamless view of all data.

 

Key benefits and results of a comprehensive and fully integrated solution can include:

Rapid implementation.

Seamless integration.

More efficient and up-to-the-minute inventory management.

Real-time accounts receivable control and inventory updates.

Transition from paper to electronic records/management.

Reduction of human error, manual processes and employee resources.

Automatic printing of needed forms.

Real time updates and adjustments.

Reduction of operational costs.

 

Working with a responsive ERP solution provider that takes the time to listen and truly understand your challenges is invaluable.  Access to the leadership of that solution provider is equally important.  Having the ability to developing a flexible solution without rewriting the system can transform the way you automate and streamline your organization.   

 

Transformation.

 

How have ERP solutions transformed your operations?  How have implementations of new solutions increased efficiencies, reduced costs and increased profitability in your organization?  We would like to know.  Please share your successes and failures with our readers.

 

Dolvin Consulting works with industry experts to help you find the right solutions that will fit your business and your operational culture.  Contact us today to see how we can help.

 

With truly automated operations and real-time access to critical data, you will be able to offer your customers outstanding service and support that will truly set you apart from your competition.