Don't fall into the pit of making your ERP system software too complicated. Then you'll have to hire a team to use it effectively.
An ERP system software is primarily an integrated suite of modules and features that can encompass financial, production, services, human resources, payroll, time entry and CRM (customer relationship management). The software is dependent upon how your company work flow operates, how you would like to set it up and how it can be incorporated efficiently and effectively into the company's environment.
The modules your company purchases is dependent upon what is most important to the company's processes (this goes back to the beginning of our ERP blog series). 
Again, one word of advise as you continue the ERP research buying process ... Keep It Simple Stupid... the old KISS method still applies here. An ERP system too complicated can make your team's life miserable. Then what happens? Your team only uses 35% of the ERP system software you have, which is the national average.
Typically companies are examining a combination of financial management, manufacturing, project management, supply chain management, product life cycle, supplier relationship or customer relationship management (CRM) software ERP modules. Know what your team desires and understand the resources needed from the company (not just the vendor) in undertaking an implementation of any piece of the modular ERP software. There's a commitment required from the company and the vendor and the agreed upon combination equals success.
Industry Specific ERP software can be necessary. I spoke with a CFO from a large asphalt company the other day. They have two types of software they use -- bidding and order/job implementation. Due to the critical element of what can be missed in a bid for a highway or a bridge, there was an ROI (return on investment) for the bidding software they implemented and used habitually. On the other hand, if some customization is necessary, most softwares can handle that but beware that you own the code and that it is in a programmed language that can be integrated to other applications or services.
Next week .... cost!
Which ERP System is right for your business?
Earlier this week Monica Glenny spoke at the Belvidere Chamber of Commerce Manufacturer's Appreciation Breakfast.
The topic: inventory management. 
Based on the discussion and amount of inquiries after the event, I think it's fair to say that inventory is something that is on everyone's mind.
During Business Clarity sessions, effective inventory management is often brought up by clients, and they're issues aren't isolated to just them.
Inventory is an issue that plagues businesses of all sizes and the same questions typically come up:
- Do we have accurate accounts of all products, materials, or parts?
- What is the physical location of each inventory item?
- What is the cost of producing each unit of product or service?
- Are we ordering appropriate quantities of inventory for future production and sales?
- Do we have any inventory that has been sitting on the shelves for years?
- Are we currently holding too much or too little inventory?
These are all questions that can be answered with the correct work flow process and by understanding inventory ratios
Because it is such a common pain point and has been a hot topic around here lately, we have pulled together some white papers that cover different aspects of inventory management.
Now that 2010 is here, people are scrambling to figure out how they're going to keep their New Year's Resolutions. They picked out their personal resolutions - lose weight, quit smoking, start a hobby, save more, spend less... but what about New Year's resolutions for your business? How are you planning on taking what you learned in 2009 and putting it into practice for 2010 and beyond?
Coming up with goals for the New Year is great, it gives your business something to work towards, but don't let it stop there. Planning out how you're going to achieve those resolutions is just as important as the resolutions themselves. They don't always have to be grandiose tactics, sometimes it's the simple steps that keep you on track.
Let's say your resolution is to pay more attention to the financial health of your business- take what we like to call "5 at 5"
Every day at 5:00 (or whenever your day at the office is winding down) take five minutes to review your key performance indicators. Here are some possibilities:
- Day's cash receipts
- Days' cash disbursement
- Current ratio
- Accounts Receivable (A/R) aging
Work your tactics into your daily routine, and your resolutions won't be as lofty as they seem.
What are some of your business resolutions this year? Better yet, how do you plan on keeping them?
We receive this question a lot from our current and prospective ERP system clients. First let's define ERP and then let's discuss the key issues overlooked and the social issues surrounding ERP implementation.
The term ERP (enterprise resource planning) applications used to refer to the manufacturing industry. Currently, ERP systems cover the core functions of a business whether they are manufacturing, non-manufacturing, not-for-profit or government. ERP system software can apply to a broad spectrum of industry segments.
ERP packages usually encompass accounting (or financial functions), payroll and production functions (manufacturing, supply chain, job cost, warehouse management, inventory management, estimates, human resources, service fees, sales order, CRM, etc.). Ideally, an ERP system delivers a single database for the data in all of the software modules. There are many free web site services out there that will evaluate various ERP systems for you. Remember, those services also receive advertisement dollars. DataCraft has performed an evaluation within our software selection guide.
Some key issues companies or executive committees overlook when evaluating an ERP implementation:
- What is the skill level of my existing team in regards to software?
- What resources will be required from my team for the implementation?
- What are our expectations for testing and going live with the new software?
- Is it cost effective to perform a data conversion? Options -- only bring over critical customer data and open transactions. Refer to all history in the old database.
- ERP systems do not have to be expensive. There are plenty of economical ERP software systems out there that range in price from $3,000 - $25,000.
Social issues (yes, I said social issues) uncovered when implementing an ERP system:
- There is no "magical" software. If you have problems with your current team members or departments working in harmony, you will continue to have those problems. Fierce conversations are needed here.
- Set up of work flow in the software is critical, but don't make it too complicated!! Keep it simple!
- Don't spend a lot of money on a customization because that is the way you've always done it and even though it's inefficient you are going to keep on doing it that way. Nuts!
What ERP Software system is best for your company? Download the Software Selection Guide
We've been working like crazy putting together webcasts and now we'd like to turn it over to you. We currently have four in the works but we'd like to hear what subjects you would like us to feature in a webcast.
- What topics interest you (Business management, Customer Relationship Management, CRM inventory management, manufacturing and distribution software work flow, software tips and tricks, etc.)?
- Do you prefer live or OnDemand webcasts?
- What days (typically) work best for you? What time of day works best for you?
Help us help you!
We're excited to hear your feed back!
It's no secret that it's not cheap to run a business and the cost of running one continues to rise, but what if you're in the business of running for president?
The Center for Responsive Politics, a nonpartisan group that tracks how money is being spent by politicians and political parties, estimated that running a presidential campaign can cost as much as running a medium sized business for two years.
In the past eight years, the cost of running for president has skyrocketed. In the 1996 election, presidential candidates spent $239.9 million on their campaigns; so far the candidates have spent $833.8 million in the 2008 election and there is still a few months left. Michael Toner, Federal Elections Commission Chairman, estimates the cost to reach the $1 billion mark. A far cry from the supposed $100,000 Abraham Lincoln spent in the 1860 election (combined $150,000 with Douglas) and $9.7 million (out of $19.8) Kennedy spent in 1960.
The candidates have also received more contributions than ever before. For the 2008 election, candidates have raised a total $942.1 million compared to a total $880.5 million in 2004 and $528.9 million in 2000.
Where exactly does all this money go? Just like the business world, how the candidates spend their money tells the public a great deal about them.
The Center for Responsive politics calculated how the money is spent:
| Description |
Total |
| Administrative (salaries, benefits, utilities, taxes, etc) |
$434.47M |
| Media (cost of advertising and media production including tv, print, radio, and internet ads) |
$359.24 M |
| Campaign expenses (consultation, polling, promotional material, etc) |
$154.35 M |
| Fundraising (events, telemarketing, mailings, etc.) |
$92.84 M |
| Contributions (Contributions from the committee to federal and non-federal parties) |
$34.74 M |
| Other (Miscellaneous including donations and loan payments. |
$25.69 M |
Teachable Moment estimated that it cost presidential candidates $100,000 a day to campaign during the 2004 general election (The amount Lincoln spent on his entire campaign) and includes research, travel and hotel, preparing stages, renting halls, and all the costs that come with.
According to the Federal Elections Commissions , Senator John McCain's beginning cash (the balance at the start of the campaign in the cash accounts) equaled $472,454 and as of the end of August had $36,579,532 on hand and owes a little over $76,667 in debts. Senator Barack Obama started out with $0 beginning cash and had $77,404,118 on hand as of the end of August. FEC also reported that his debts equal $469,025.
The entry fee for the election was estimated around $100 million and will only continue to rise over the years, proving that running for any elected office, especially for president, isn't for the penny-pinchers.
Let's be honest; many of us have tendencies to stockpile items that we do not always need. Having a bulk of some items can be beneficial, but when it comes to accounting software, having too much can be bad for your business.
Scattered information caused by too much software can create a whirlwind of problems for businesses. Lost or inaccurate data and the expenses that pile up with constant software updates are just a few of the problems businesses can face. These problems can lead to businesses being at risk of becoming less efficient.
A possible solution to the problems created by too many databases is streamlining software. Streamlining software can condense valuable information, making it easier to access. Perhaps the most important part of streamlining is knowing which products work best for your company.
At Datacraft, we offer Business Clarity, a service that helps companies utilize accounting technology the way it is supposed to be. Business Clarity offers a free software selection guide and software analysis to help you choose the right software for your company. Using Business Clarity can get rid of outdated and unnecessary software that is doing your company more harm than good. Check out what Business Clarity can do for your company.
While stocking up on some items is a good idea, hoarding software does more harm than good. Take time to find the software that is the right fit for your company, it can make a world of difference.
Schedule a Business Clarity session.