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erp tipsCompanies doing ERP projects should realize that it’s not an IT project – it’s a business project.  It affects all areas of the company.  Politics and complexity must be balanced.  So we thought the following 6 quick tips from Mae Kowalke written for the IT Toolbox did a very nice job of quickly encapsulating a few important things every project team should remember:

  1. Get support from the top. ERP is a business-wide project, so it needs executive (C-Level) buy-in.  If it doesn’t, the project will struggle mightily later, and eventually get bogged down in politics and infighting among even the best of intentions.  And that senior leadership needs to show interest and stay concerned throughout the rollout.
  1. Assign a dedicated project lead. Companies need an experienced project leader – whether they are an internal resource or an external one – to safely guide the implementation through the many challenges it will face.
  1. Define organization needs up front. Be sure you have defined, and everyone understands, the business objectives you are trying to accomplish.  The clearer you can list your requirements and desired outcomes at the start, the better your odds (and often, the lower your cost, because you’re not spending time and money on unplanned or unneeded features).  Can you define what project success looks like at the start of your project?
  1. Plan for scope creep. Set realistic expectations and plan accordingly.  But also plan for changes.  They always happen.  Setting milestones will help clarify project step success criteria.  Have a robust process for signing off on changes, to ensure they are necessary and meaningful.  Plan and keep regular status meetings between your company and your consultant providers to review project progress.
  1. Be ready to adjust business processes. Sometimes, the best thing you can do is change a business process, whether to match the software, or vice-versa.  Either way, ERP projects are THE time to analyze, change and improve processes.  Fix what’s broken while you get a fresh start.
  1. Give training its due. (We couldn’t agree more.)  According to Gartner,               “75 percent of enterprise ERP implementation failures come from lack of end user adoption.”  Training is all too often overlooked or short-changed during the budgeting process.  Resist the temptation to do this.  “When you overlook the need for adequate training, you lose insight into the business results that are desired,” notes Amy Whetzel, director of ERP consulting operations for BroadPoint Technologies.  We couldn’t have said it better.

hackerIn a Wall Street Journal report entitled “Information Security” (April 20, 2015), staff reporter Danny Yadron highlighted 5 key steps companies can take to improve their “cyberhygiene” that have a lot less to do with spy-grade technology and a lot more to do with boring things that companies too often skip, like:

Step One: Keep up with the patches.  Last year a third of new hacking tools discovered by security researchers at HP involved exploiting a flaw in Microsoft Windows that was discovered in 2010.  Microsoft issued the correction patch years ago.  Unfortunately, too many companies simply don’t keep their software up to date.  As security expert Alan Paller notes: with patches “you’d stop most of these attacks.”

Step Two: Keep your online doors closed.  The average family has five or more machines attached to the Internet (phones, tablets, PCs, TCs).  Businesses typically have many more – and often don’t even know which are online.  According to Verizon, last year nearly one-fourth of all breaches were the result of hackers getting into a machine that didn’t need to be online.  The solution is simple: make sure that only necessary machines are online, and that they’re protected.

Step Three: Encrypt your data.  For starters, be sure your credit card transactions are PCI Compliant.  You should not be holding customer credit card numbers anywhere.  Beyond that, internal encryption can get costly and can slow some operations down.  Home Depot spent $7 million to ensure encryption for its 2,200 stores.  The stolen data that makes headlines is always of the unencrypted variety, so companies must balance the cost against the public relations (and financial) debacle that ensues if a major breach occurs.  This is much more of a concern for the Big Guys, but we’ve always found that whatever affects those big guys trickles down to us Little Guys eventually.

Step Four: Get rid of passwords.  As the journal notes, “Users hate them.  Security staff dread them.  Hackers love them.”  According to Verizon 25% of all breaches could have been stopped if the victim companies had required more than a password to enter its networks.  Users often use the same passwords for networks, banking, password files and social media, to name a few.  New technologies are emerging, like a tiny USB token that verifies a user’s identity in conjunction with passwords  for an extra layer of security.  In early tests, it’s been effective and well received by employees.

Step Five: Check out your vendors.  About one-fourth of data breaches have been linked to hackers getting into a vendor or third party, and then backing their way into a larger target firm.  Target, Inc. traced its infamous breach back to a heating contractor.  Home Depot’s was linked to outsiders who had access to their corporate networks and were hacked first.  The solution lies in careful oversight.

That may not be foolproof, but it will plug the obvious holes.  And as you can see from the items above, most of the tactics that will increase your own network security are pretty low-tech.  Basic “blocking and tackling” one might say.  Start with the obvious.  Your odds can only go up from there.

 

3 STOOGESAs noted in our prior post, based on a piece written by Panorama Consulting, it is critical that companies implementing a new business management solution make sure they’re putting their cart in front of their horse.  Which it to say… you have to start to look at business process reengineering early in the process.  That means resisting the ERP salesperson’s suggestion not to think too much about future business processes until you get your software installed.

Indeed, the most important thing is to understand those current processes, and determine what they’ll look like in your future state, before you spend any money on software.

We’ll conclude this post today therefore by noting a couple key points made by the folks at Panorama, in a post we’ve summarized, but you can find here.  As they write:

“Too many organizations think that they will simply start with a clean slate and throw out their old business processes. We get it: your current business processes and systems are outdated, inefficient and ineffective – and you want nothing to do with those broken business processes going forward.

However, too many organizations throw the baby out with the bath water by neglecting those things that have made them successful. In addition, employees won’t understand the future state business processes unless they are communicated and trained in a way that connects them to the current way of doing things – or those processes that they understand best.  Even the best-designed business processes will be ineffective if your employees can’t understand them in the context of how processes work today.”

So, what should you do?  The author posits three ways to help ensure your team avoids the pitfalls of a Ready, Fire, Aim approach:

  1. Remember to address both your current and future business processes. This should help illuminate the gaps between them which “is critical to ensuring your employees understand what is changing and how.”
  2. Begin defining business process improvements prior to your ERP implementation. Doing this early in the process will make your entire evaluation process that much more effective.
  3. Use your reengineered business processes as the foundation for your organizational change management and training strategy. Once business process changes have been defined and documented they should serve as the premise for training, communication and other organizational change management activities.

Wise advice from a firm that deploys big ERP systems, and which could not be more apropos for all smaller companies as well.

notsoeasybuttonOnce again we take note of a post by the folks at Panorama Consulting – if only because their experience selling ERP to big companies so often mirrors are own experiences in selling to smaller ones.

In a recent post they talk about the importance of business process reengineering noting how important it is to analyze your workflows and processes early in the process.  To quote directly from a recent post found here.

“…Some things look good on paper but don’t translate to reality – project teams decide business process reengineering will take too long, cost too much money and expose the project to too much risk. After all, isn’t it reasonable to assume that if we start configuring software without spending time to change our business processes, that the implementation will go faster? On paper, yes.  In reality, no. Failure to address or improve business processes too often results in additional complexities caused by inefficient operations that result in immensely slowing down the technical aspects of an implementation.”

The truth is, companies need to look at their processes before they get involved with software selection.  A lot of ERP salespeople however will encourage prospective clients to “defer to the ERP software to deliver business process improvements.”

Again, the folks at Panorama sum up this wishful thinking clearly and effectively:

“We’ve all heard it repeatedly during ERP vendor sales cycles: don’t think too much about your current or future business processes until after you buy our software. This is often referred to as the “easy button,” which most of us know does not exist for ERP implementations.  

In reality, most ERP software is extremely robust and flexible, meaning that even the simplest business processes can be executed in numerous ways, resulting in millions of potential variations across any one organization.  This complexity is overwhelming, will slow down your project and will ultimately cost you a great deal of money if your business processes aren’t well-defined prior to beginning the design and build phases of your implementation.”

The lesson for companies looking to build a better infrastructure out of modern software and technology is simple: focus on the business needs (not the whiz-bang technology) and start that process with a firm focus on how today’s process and workflow will translate into tomorrow’s.  Only once you’re confident you understand that piece does it make sense to get serious then about software.

We’ll have some closing thoughts on the key steps required to do that in our concluding post.  Stay tuned…

moores_law_graphAs two recent articles in the Wall Street Journal point out, the celebrated tech axiom known as Moore’s Law is reaching its 50th birthday.  The term is named for the idea first posited by Gordon Moore that the number of transistors that could be crammed into a given space would double about every two years or so, and continue to do so, indefinitely.  And we all know what happens when you double something over and over again… pretty soon we’re talking large numbers.

As an article by Michael S. Malone in the April 18th Journal pointed out, the idea began as a graph (shown here) that illustrated  an article in Electronics magazine.  It didn’t gain Moore’s named affixed to it for another ten years.  At the time, Moore was working for Fairchild Semiconductor.  He would later co-found and become CEO of Intel.

Over 50 years, Moore’s idea has indeed stood the test of time, despite regular predictions of its imminent demise.  Chip performance doubles about every 18 months.

But it is getting harder.

Today, the design and testing of the next generation of chips comes at a cost of $132 million, according to International Business Strategies, Inc. of Los Gatos, California.  Just ten years ago, that cost was a mere $16 million.  The circuitry required for today’s newest chips has a width of just 14/billionths of a meter, allowing manufacturers to squeeze hundreds of millions more transistors on a chip than previously able.  But, as the Journal’s Don Clark points out in another article, “designing products that use so many more components takes lots of time and money.”

While it’s said that the shrinkage can continue for at least another decade, the price of these chips is going up dramatically.  As Micron Technology CEO Mark Durcan notes, “There will be smaller and smaller pieces of the market that will pay for the improvement.”

Early on, Moore predicted that the number of components on a single chip would double every year or so from 60 to about 65,000 by 1975.  Back in the early days of Fairchild, a transistor sold for $150.  Today, Intel’s Core i5 chip includes 1.3 billion transistors and sells for the equivalent of about a penny for every 70,000 transistors.

So while the relative cost (as viewed in cost per transistor) may have declined dramatically, the fact is, making these chips is becoming prohibitively expensive as chip heat constraints bump into the walls of physics and smaller pieces of the market are willing to pay for these advances.  There may indeed be a non-technical – but fiscal — reason that “the end is near” for Moore’s famous law.  Chip fab plants now run upwards of $10 billion.  Production delays due to manufacturing defects at Intel caused it to be a half-year late on its latest chip.

Then again, new technologies (like stacked three-dimensional circuits with 32 or 48 layers per chip) will keep boosting device capacities.  Intel plans to deliver a chip for specialized applications this year with 8 billion transistors – 133 million times more than when Gordon Moore first made his bold prediction.

So perhaps fans of Moore’s Law might say as Mark Twain once said… “the rumors of my demise have been greatly exaggerated.”

newinnavToday’s post will be primarily of interest to users of Microsoft Dynamics NAV, particularly those who haven’t upgraded in a few years.  Since the introduction of the first Role-Tailored Client (RTC) in NAV 2009, Dynamics NAV users have seen additional functionality from later upgrades to versions 2013 and 2015.  And with NAV’s recent and strong commitment to ‘agile development’ (i.e., rapid deployment of new features), users of NAV can probably expect to see more, and more rapid development of features and functionality in the future.

Following are some of the key enhancements we’ve seen over just the last two versions (specifically, 2013-R2 and 2015).  Some of the advances made in the 2013-R2 release included:

  • One unified Microsoft experience with additional Office 365 productivity and rich Microsoft Dynamics NAV business insight.
  • Helps customers collect cash faster with new capabilities for electronic payments and automated account reconciliation.
  • Provides a tablet and touch-optimized user experience enabling you to access company data and processes regardless of location and device.
  • Faster access to information with personalized home pages that let users view their most important business data at a glance.
  • Sophisticated color coding and live data helps user prioritize actions.
  • Simplified invoice design through interoperability with Microsoft Word.

With an eye towards Microsoft’s new embrace of a “mobile-first, cloud-first world” enhancements released in NAV 2015 included:

  • Tablet and touch-optimized user experience enabling users to access their company data and processes regardless of location or what device they choose to use. With this release, new Microsoft Dynamics NAV tablet applications are now available from the Windows, Apple, and Google app stores.
  • Faster access to information that matters with personalized home pages that let users view their most important business data and key performance indicators in a glance.
  • Sophisticated color coding and “live data” help users prioritize actions and stay productive.
  • Simplified invoice design and production through new interoperability with Microsoft Word. Power users can now create customized, branded invoice templates on their own in Microsoft Word.
  • Additional optimization to deploy in the cloud on Microsoft Azure to help lower costs and increase flexibility.
  • Deeper interoperability with Office 365 to boost employee productivity. Improvements include single sign-on and consolidated views of business data, documents, business intelligence, and collaboration tools.

NAV continues to grow in capabilities and we’ve found it to be an ideal platform for small to midsize businesses, particularly those engaged in manufacturing and distribution, upon which to optimize their workflows with an extremely strong and flexible accounting foundation, especially well-suited for growth oriented firms.

people first tech second imageIn an article entitled “People First, Technology Second” author Eric Kimberling points out that while the technological (and technical) landscape of ERP have changed much over the past twenty years (or in my experience, 30 years…), the basics have not.  People still matter most.

You might not know this by the emphasis sometimes placed on ERP implementations where it is sometimes placed highly on the software, less so on the people involved.  But that has it backwards.

While there may be a dizzying array of choices in ERP solutions these days, it’s the people issues that are most likely to make or break your implementation.

Too often, executives overlook this simple fact.

As Kimberling points out in his article: “The end-users of your ERP system are still going to either buy-in or resist the changes based on pretty simple and predictable criteria. Regardless of whether you were implementing ERP systems 20 years ago, you’re starting your implementation today or plan to 10 years in the future, the effectiveness of your impact and management of people during this business transformation will determine whether your project succeeds or fails.”

He goes on to tout therefore the importance of an oft-repeated mantra on the need for “organizational change management.”  It’s the critical component, he notes.  All the bells and whistles of the technology are for naught if your people don’t embrace, use and build upon the solution to improve business operations.

From not understanding the changes to be made… to not being a part of the process change development… to insufficient training in the software or the processes at hand… to processes not properly defined… to office politics… all of these “people” issues can lead to frustrated implementations that can be late on time and over-budget because management did not give proper time and consideration to the needs of the very people who will implement and use the system they’ve bought.

In the end it comes down to a key point, notes Kimberling: Don’t confuse activity with efficiency.  While technology is helpful to the cause, invest the time and resources in organizational change management necessary to train your people.

We would add to Kimberling’s comments by noting from our own experiences that it’s all about the basics of course: Communicate clearly.  Identify specific business processes and how they will be managed.  Map the software to the process.  Train the people, and listen to them.  Do the little things right.  And lastly, take ownership of your system.  It will all add up to a far more successful implementation in the end.

 

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