If you're a small to medium sized company, searching for technology solutions to help manage or grow your business, then you have undoubtedly read about 'The Cloud'. You may even have learned about some of the basics from an article we wrote a little over a year ago. The basic premise of the cloud is a simple one - rather than running your business software on an internal network, it is stored, maintained, and accessed from the internet. Another good source for a clear explanation of the cloud is available from Salesforce.com on YouTube.
Web-based or cloud-based consumer solutions were adopted more quickly and easily than business solutions. For example, people don't resist backing up files on-line with providers like Mozy that offer an annual service competitively priced according to the amount of data needing to be stored. Still others are comfortable using Google Docs for the creation, storage, and modification of word processing documents, spreadsheets, presentations and more.
We’ve been doing quite a bit of work in Italy lately, and it’s gotten me thinking about ERP project communication and the inherent challenges that continue to get downplayed or ignored, even in the face of avoidable failure. My Italian is marginal at best. As with the adoption of most new languages, I’ve got a few colors, numbers, and polite words under my belt, along with a grocery list of yummy foods. This vocabulary doesn’t go very far in a work situation.
ERP software has long been touted as a solution to a myriad of business problems, but implementations often fall short of the promises of improvement that seemed so certain in the early stages. Don't be so quick to blame the software though - it's the easy scapegoat. Think of your software as a tool. While providing the right tools is a necessary first step, it's not enough to just give them to your employees and walk away. I own a hammer - it doesn't make me a carpenter.
ERP solutions are tools that should support your business processes, not dictate them. Ensuring employees and the business get the most from the tools requires a thoughtful, well-defined approach to training.
“How do we get there from here?”
This age old question has stumped many businesses over the years, acting as one of the biggest barriers to embarking on change within an organization.
“Here” looks more and more appealing as a place to hunker down and settle for awhile if the path to ‘there’ isn’t clear. But if you’ve decided that “here” is outdated or no longer sufficient to meet the needs of your business, then get out your compass and embrace the concept of the Gap Analysis.
A gap analysis is performed as a means to define a road map of sorts that outlines the differences between a source system (here) and a destination system (there).
On-going training is the third hidden cost.
Software upgrades, maintenance, and support are typical line items on ERP proposals. If they aren't, definitely ask about them. Consider that the costs listed on the proposals are ‘gateway’ costs. In order to receive upgrades, maintenance, and support, you have to pay $X. Traditionally the cost is calculated on a percentage basis of the overall software package, and some vendors require clients to commit to a certain number of years of maintenance and support.
Considering an ERP solution for your business? If so, in all likelihood, you’ve done some research on introductory costs and put together a budget. But have you considered some of the less obvious expenses of your project?
There's been a lot of recent industry buzz about ERP packages being so robust now that customization may not be required, but the reality on the ground hasn't seen this change yet. During the requirements gathering phase, there are obvious areas of customization that may be discussed, scoped, and accounted for in the original proposal. Once the commitment is made and things start moving forward, however, 'uniqueness' can ooze from the walls to such a degree that significant revenue is being driven by the ubiquitous change request.
Have you ever wondered how computers take a keystroke and know what to display on the screen? I remember channeling my inner geek several years ago while writing a BASIC program on DOS and wanting to know more about how this was done. That seemed like pretty sophisticated stuff back then.
I picked up a copy of a DOS programmers guide and learned that the BIOS interpreted scan codes to match an ASCII character with a keystroke. There was a mystical matrix of ASCII characters in the back of the book that showed the corresponding decimal and hex values. In fact, you could hold down the Alt-key, dial in the decimal number, and see the corresponding ASCII character.
It’s that time of year again when people are weighing in on the year-in-review and wagering bets on trends or innovations for the future. With regard to ERP trends, introducing mobile applications to the enterprise seems to be a popular concept.
We’re all familiar with the mantra, ‘There’s an app for that’, but will we be saying this about enterprise functions in 2011 or will it continue to be just for the consumer?
Chris Kanaracus’s article for Computerworld is just one example of mobility in the enterprise making a predictions list. Some of his information stemmed from a recent IDC press release where they are forecasting acceleration of the mobile applications market. The number of downloaded apps in 2010 was 10.9 billion and it’s expected to grow to 76.9 billion by 2014. It’s hard to imagine that type of growth without touching the enterprise in a big way.
Around the holidays there is often talk about inventory for retailers – are they stocking up on the hot items? Slashing prices to move old inventory? Will they run out of the top children’s toys before I finish my last minute purchases?
In a recent post , we talked about the importance of adopting the Goldilocks Principle when managing inventory. The Goldilocks Principle encourages managing to the middle rather than the extremes. With regards to inventory, that means not overstocking for fear of running out and not under-stocking either.
A tight economy tends to encourage companies to reduce stock, and perhaps with good reason; but without tools to forecast the best stock levels, companies may find their belt-tightening does more harm than good. Just ask my sister. Lately she’s fallen victim to more than one company’s poor efforts at inventory management and, trust me, she isn’t being quiet about it.
During the good years, when the economy is flourishing, does your business employ the same inventory controls it does when times are tight? While I’m hopeful the answer is ‘yes’, my partner and I have come across many companies who actually didn’t have any particular inventory controls when times were good and now are struggling to figure out the right models.
Several years ago, someone could open a new retail shop with a catchy name and good concept and be met with fairly quick success. It was the era of ‘Open it and They will Come’. Loans were readily available, people could find prime retail space, stock it full of great inventory, and focus on incoming cash. It was easy to overstock and seemingly no reason not to. That’s the boring side of business, right?