Enterprise resource planning systems, CRMs and other tech such as RFID, barcoding, customer and supplier portals, blockchain, IoT, and GPS tracking all support this goal.

Modern ERP systems are no longer just about transactional processes and standard business processes. They are now pivotal in meeting customer requirements, supporting automation, and integrating other essential technologies like AI, IoT, CRM and e-commerce.

Companies must stand out from the crowd with a superior customer experience to sustain profitable growth during these turbulent times; however, service alone will no longer suffice. Companies must contain cost and mitigate risk. ERP and related technologies are key to achieving these objectives.

During these turbulent times of supply chain disruptions, geopolitical risk, and stubborn inflation, companies must take bold action to mitigate risk, stabilize the supply chain, provide a customer service edge, and contain costs. As wars rage across the world, geopolitical risk has skyrocketed. If there is a disruption at one node in the end-to-end supply chain, the disruption can ripple throughout the entire chain. Executives realize that the risk is simply too high to count on the supply chain remaining stable without securing and gaining visibility to their full supply chain.

Similarly, as the world struggles with limited resources, high inflation and interest rates, there is an intense focus on cash flow and cost containment. Only those companies that automate, digitize, and utilize advanced technologies across their supply chains will be able to support customer requirements while maintaining and increasing profitability, productivity, and working capital. This will become even more critical as those companies that do not invest in their future will not be able to meet customers’ needs, leaving a vast opportunity for those ready to scale and meet customer requests.

Not enough to use your old ERP in new ways

Better utilizing an old ERP system will no longer suffice. To stand out from the crowd, you must go beyond these fundamentals and offer a differentiated or personalized customer experience.

For example, your ERP system must allow for progressive e-commerce capabilities that support not only B2C consumer expectations but also provides advantages for B2B customer ordering and status visibility with ease and effectiveness. Your ERP system should support customer personalization as well as product and service customization.

Similarly, a customer relationship management (CRM) system should be robust in tracking your pipeline, building relationships, and providing relevant insights and statistics of where to focus. Our most successful clients focus on analyzing CRM data, forecasting future customer needs, and utilizing these insights to build customer relationships.

The best clients combine CRM with a powerful business intelligence system to create predictive analytics and assess what if scenarios. The best companies connect directly with their customers’ data and provide proactive insights and differentiated value to their customers.

In addition to gaining sales, companies should utilize ERPs to take customer service to the next level with collaborative customer ordering programs and vendor managed inventory programs. By utilizing demand planning and sales forecasting including the use of AI and predictive analytics as well as replenishment planning and advanced planning functionality, clients can solidify their preferred partner status.

For example, a health care products manufacturer grew the business by outperforming their key customer’s resources in determining what to stock where. Not only did they increase their customer’s fill rate and shorten lead times, but they also reduced their customer’s inventory levels. The customer responded by expanding business and suggesting additional opportunities. In addition, the manufacturer reduced inventory levels and improved their production, warehousing, and transportation efficiencies. Profitability and cash flow increased.

Manufacturer technology that supports supply chain visibility

End-to-end supply chain visibility is essential to responding quickly to changing conditions and in providing Amazon-like status updates to your customers. Several technologies support this type of visibility, including RFID, barcoding, customer and supplier portals, blockchain, IoT, GPS tracking, and more. Smart companies are collaborating with supply chain partners to gain access to status information and to connect, plan, and optimize efficiencies across their supply chain.

For example, if you know the status of key materials, you can better plan production to minimize costs while meeting customer expectations. If you know the status of incoming goods, you can optimize truckloads and modes of transportation to mitigate costs while improving delivery performance.

The metaverse can bring together what customers ask for with what customers need. In essence it can accelerate your SIOP (Sales Inventory Operations Planning) process. In a metaverse collaborative room, any set of customers, consumers, and suppliers can meet virtually to review sales forecasts, projected production plans, and possible supplier/capacity limitations that could affect manufacturing volume. They also can visualize an immersive supply chain network map, see where inventory is, identify issues, and model possible solutions. These types of proactive solutions will upgrade your ability to secure your supply chain, enhance margins, and provide end-to-end visibility.

The ever-increasing importance of automation

In addition to automating repetitive tasks, ERP systems and related technologies can keep facilities running at night without people. Since most clients have consciously prioritized which customers to serve due to limited resources, taking advantage of lights out capabilities is quite appealing.

For example, an aerospace manufacturer had a bottleneck in a critical area of the shop that required high-skilled resources to function which created significant past due and unhappy customers. This client purchased a robot and invested in high-skilled talent to modify the robot to work for their needs and connect it to their systems. They were able to program the robot during the day and run lights out on second and third shift, quickly resurrecting their customer service and supporting future growth.

As companies expand and upgrade the use of ERP and related technologies, they can create unique value for customers and in their supply chain. Taking it a step further, to thrive during these turbulent and inflationary times, it is important to automate, digitize, reduce repetitive labor requirements, increase efficiencies, and standardize so that more can be achieved with fewer resources. The best companies engage their people and connect with customers and suppliers to upgrade the end-to-end customer experience.

Originally published on Smartindustry.com on November 17, 2023.

The post Leveraging ERP and related technologies for a diverse customer experience appeared first on LMA-Consulting Group, a supply chain consulting firm.

Lisa Anderson was quoted in SelectHub on what will be important in ERP circles in the year ahead. Read about the importance of business intelligence and ERP. “Clients have realized they need to be able to slice and dice data to quickly assess changing conditions, make directionally correct decisions rapidly to keep demand and supply aligned and get a quick handle on what’s coming so that they can be ahead of the competition and prepared for whatever is ahead. Combining BI with advanced CRM, forecasting and B2B/B2C software functionality are essential to successfully managing demand. BI with IoT, MES, WMS, TMS “and advanced planning systems are [the] cornerstone to successfully managing supply.”

“An ERP software system is often one of the most significant investments a company will make. This solution is a major financial and practical decision that can impact all parts of your business, like human resources, accounting, manufacturing, marketing and more. Before selecting a new system, buyers should research current solutions and ERP trends coming down the pipeline. … We spoke with several leaders about the upcoming ERP trends we can expect to see. Between a movement to the cloud, the internet of things (IoT), industry-specific ERP solutions and artificial intelligence (AI), the future of ERP looks brighter than ever.”

To read the full article, click here.

The post SelectHub: ERP Trends: Future of Enterprise Resource Planning appeared first on LMA-Consulting Group, a supply chain consulting firm.

Manufacturers utilize less than 20% of the full functionality of their ERP systems. But the key question is, why does it matter? In today’s inflationary and supply chain disrupted business environment, manufacturers need to automate and digitize to ‘do more with less’ and thrive during these volatile times. One important way to achieve this goal is to further leverage your ERP system where it will make a difference.

No matter which ERP system you use or how archaic, there will be opportunities to use additional functionality. In 30 years of working with manufacturers, there hasn’t been one example of a client that couldn’t benefit by expanding the use of ERP. Beyond customer, profit, and cash flow benefits, ERP systems can help you automate the repetitive and mundane. The people benefit. Turning jobs from repetitive and injury-prone to exception-based with opportunities for learning and development can engage people’s interest. With the shortage of talent as the number one issue to top executives, it is worth investing in the expanded use of ERP.

Start by exploring and assessing which functionality would provide the most value to your organization. ERP systems support your order to delivery cycle, which is essential to successfully fulfilling your sales order demand, improving delivery performance, and reducing lead times. ERP functionality also supports the procure to pay cycle, which is key to purchasing the right materials to arrive at the right place at the right time to support manufacturing and most efficiently manage inventory levels. Almost every client can improve upon the plan to produce cycle, which can achieve three objectives simultaneously – improved customer service, increased efficiencies, and accelerated working capital.

Beyond base ERP, there are many technologies that support the customer such as customer relationship management (CRM), sales forecasting, and e-commerce. Additionally, there are software options to automate and digitize for increased efficiencies and improved quality standards such as the use of barcoding, RFID (radio frequency identification), robotics, autonomous vehicles, digital twins, and automated storage and retrieval systems. Critically important are software options to aid in analyzing and predicting data such as business intelligence (BI), artificial intelligence (AI), and predictive analytics.

As easy as it might be to get caught up in fads and trends, take a step back when assessing where to focus efforts. Understand your customer requirements and business requirements. Which functionality will provide the greatest benefit to your business? Which software functionality will best position you for growth?

For example, in a building products manufacturer, an assessment was completed of their use of their ERP system. Although they might benefit from advanced functionality such as available to promise (ATP) and advanced replenishment planning methods, they discovered they could benefit greatly by simply further leveraging their planning systems to increase OTIF (on-time-in-full) and add value to their service. By focusing on this simple objective, the sales team was able to grow the business during times of significant volatility and uncertainty.

As manufacturers focus on the expanded use of ERP and related technologies, they can create unique value for customers and in their supply chain. Taking it a step further, to thrive during these inflationary times, it is important to automate, digitize, reduce repetitive labor requirements, increase efficiencies, and standardize so that more can be achieved with less. Create value by better utilizing your already-existing ERP asset and engaging your people in solutions and progress.

As originally published in Brushware Magazine on September-October, 2022

The post Using ERP & Related Technologies to Automate, Digitize & Thrive appeared first on LMA-Consulting Group, a supply chain consulting firm.

Customer Relationship Management (CRM)

During times of volatility it is of paramount importance to stay in tune with your customers. Otherwise, you could set and execute strategies that are a waste of limited time, money, and resources as conditions evolve. We are seeing a great reset occur. Baby boomer owners of closely-held companies are selling. Depending on the buyer, everything changes. For example, if a strategic buyer purchases the company, and they happen to have a manufacturing facility with excess capacity in the same region, it is likely they will consolidate, thereby changing the entire supply chain. On the other hand, if a strategic buyer purchases to gain entry into the marketplace as their current operations are in Europe, they are likely to invest and expand the facility. Or, the buyer could have production sourced from Asia but want a footprint domestically. A private equity buyer will have different objectives altogether. There are countless scenarios that could occur.

Additionally, public companies are reevaluating their supply chain based on lessons learned from the pandemic and emerging goals such as sustainability. As they reconfigure their supply chain, impacts will be widespread on their end-to-end supply chain. Additionally, mid-tier companies are evaluating the risks of producing in China in conjunction with their customers’ increasing expectations for rapid deliveries and order changes. Forward-thinking organizations see opportunity to take market share as their competition struggles, and so they are preparing for the future. And this is before you consider the shortage of resources and skills. The bottom line is that customer requirements and supply chains are “on the go”. Thus, you must keep up with your customers and ideally get ahead so that you can create your future instead of responding as they occur.

Customer Relationship Management to the Rescue

Customer relationship management has always been an assumption to achieving a superior customer experience and profitable growth. There is no doubt it will be even far more integral to survival in the future. More importantly, those who can stand out from the crowd will have an opportunity to take market share and thrive.

CRM processes offer several benefits:

• Increase customer lifetime value
• Grows revenue
• Improves profitability
• Supports SIOP with the alignment of business silos
• Improves products, services, and customer support
• Allow you to be ready for what’s next

The best practice customer relationship management processes boil down to a few core concepts:

• Staying in touch with customers on a regular cadence with the frequency and mode related to the customer’s strategic relevance, profitability, opportunity for growth etc.
• Tracking potential customer opportunities for expansion (new ship points, products, regions, etc.) including the probability of success, likely timing, likely products, likely regions, funding status and/or gate status (also known as pipeline management)
• Uncovering and tracking new potential customers and market opportunities
• Tracking the order fulfillment cycle from lead to quote to order to installation etc.
• Keeping track of your relationship network and what’s important for future success
• Tracking key events and changing conditions related to your industry, network, etc.
• Using a coordinated and proactive approach with customer communications including feedback loops.
• Tracking customer agreements (inventory agreements, service level agreements, etc.)

The bottom line is that a CRM process will increase BOTH your value and your customers’ value.

Do You Need CRM Software?

Of course, the answer to whether you need a CRM software to be successful in customer relationship management processes is “it depends”. Multiple clients utilize CRM tools and consider them essential and directly supportive of customer growth and success. On the other hand, there are several client examples of success using old school tools such as tracking contacts in a black book, picking up the phone and using Outlook or Excel to track additional details (inclusive of all core best practices).

With that said, CRM is different from other software functionality such as sales forecasting where it depends on the complexity of the business, volume of customers etc. All modern ERP systems have at least a minimum level of CRM functionality, and so using CRM will make sense in most situations. The key question will be timing vs resources and benefit for your situation. With that said, not all clients choose to use the base CRM functionality provided in their ERP system. It depends on the system functionality needs that will best support your sales team and customer needs. Of course, not all CRM systems are created alike!

How to Select a CRM Software

You should pay attention to selecting the best software and partner to meet your business needs. As is true with best practices in ERP selection, selecting CRM software starts with your business requirements.

Collect your business requirements to support your CRM process. What functionality is important in developing a customer relationship management plan for your situation. For example, a few questions to consider in getting started include:

• Starting with the basics, will the software track contacts, customers, leads, and prospects?
• Will the software allow you to track contacts at each customer from different departments? For example, in several industries, the key point of contact is one department such as engineering or maintenance whereas the orders go through another department such as purchasing. You will want to keep track of key contacts, not just those related to the order.
• Will the software support tracking inventory agreements and service policies? To what degree?
• How sophisticated is the pipeline tracking? There are a large number of questions related to this topic.
• How does the software integrate with email? There are varying levels of integration options that can make or break success.
• How does the software integrate with social media and email communications? Again, each of these could break into a multitude of questions.
• Does the software have artificial intelligence (AI) capabilities?
• What advanced reporting and analysis capabilities are built into the software?

Next, research CRM software options. Although this appears easy to do online, it is far from easy to get to the appropriate level of detail to end up with software options in the appropriate price range with the most critical functionality features. As a globally recognized expert in selecting software, our Google searches only yield appropriate results less than 20% of the time. Frustrating! You don’t need a lengthy list. A few decent choices that meet the majority of your requirements will suffice.

Depending on your company size, complexity, investment budget, and other factors, you will perform a simplified or comprehensive RFP (request for proposal) where you compare the software options to your business requirements to narrow the selection options. Typically, you should demo 2 or 3 options to see how the software will be used to meet your business requirements. Track how each software satisfies your business requirements and focus on those critical to your process. It is easy to get lost in bells and whistles the software suppliers want to show you instead of focusing on what will drive value for your business.

In addition to comparing functionality, you’ll want to compare pricing and partners. Pricing is another black hole. Getting apples to apples pricing is nowhere near as easy as it appears, and it is always extremely misleading. Dig into pricing until you have a side-by-side comparison of like items, considering short term and long term. Typically it is best to use a total cost of ownership calculation over 5 or 10 years, depending on your circumstances.

Finally, dig into the partner. 80% of success is in implementation, and your partner will be integral to this result. Every supplier will have success stories and talk a good game or they will not be in business very long. In fact, there are more sharks in software sales than in almost any other industry. They sound wonderful, but when rubber meets the road, it is often a different story. Make sure you don’t marry the wrong partner while selecting the “right” software.

Using CRM Software

You will be performing customer relationship management processes prior to rolling out software. Thus, you can ramp up over time, starting with the top priorities from a functionality perspective that will drive results and minimize manual labor. For example, if you aren’t using a CRM software currently, start by tracking contacts. It will be easy to ramp up from there with potential client contacts. Build a rollout plan that best supports your business. You’ll gain a quick payback with CRM software if rolled out in a thoughtful way. For example, do NOT track unnecessary, nice-to-have information that ties up your sales team with keying into CRM software instead of talking with customers. On the other hand, tracking key information will provide exponential value when analyzed and is worth taking 5 minutes to input. Use common sense!

Incorporating into SIOP, also known as S&OP

CRM software will not achieve the intended results if not incorporated into a SIOP process (Sales, Inventory & Operations Planning). CRM is incorporated into the demand plan which is the “S” of SIOP and required to drive capacity and staffing, sourcing, long-lead time material, and customer and product priority decisions at a minimum. SIOP inclusive of demand planning is not a one-time process; instead it should be conducted on a monthly cadence, looking out at a 12-24 month horizon. Results will follow.

As clients gain traction, they are tempted to skip monthly cycles. Keep the priority focus on SIOP inclusive of your demand plans. If you focus on exceptions and changes, the process will be quick yet critical to keeping resources aligned on priorities and addressing changing conditions. Undoubtedly, with the level of volatility in today’s business environment, sticking to the process will yield exponential results. For example, one of our most successful clients is vigilant in prioritizing Executive SIOP meetings (and associated processes). Even in months where key executives believe there are no changes, 80% of the time something arises through the process that keeps them ahead of the curve in pivoting strategies or ensuring the alignment of demand and supply, and most importantly, the related resources. This client will undoubtedly be better prepared for the next curve ball.

If you want to pursue upgrading your demand planning process, upgrading your use of technology and/or incorporating into a SIOP process, review our SIOP webpage of resources or contact us to discuss further.

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As clients become interested in S&OP (Sales & Operations Planning), also known as SIOP (Sales, Inventory, and Operations Planning) to get in front of customer requirements while simultaneously increasing margins and profits, executives want to know if software is required to support S&OP success.

Is Software Required to Support SIOP Success?
Although the answer to this question is that “it depends”, after almost fifty successful SIOP projects with clients across multiple industries and sizes (from closely held businesses to private equity backed to large, global organizations), SIOP specific software has not been required for success.

With that said, there are benefits to using SIOP specific software products in certain situations. On a related note, ERP and related technologies are integral to success, and data is cornerstone to a successful SIOP process and results.

Is an ERP System Required to Support SIOP?
Almost every client has an ERP system. At their core, ERP systems perform the transactions required to support taking orders, purchasing materials, planning production, picking and shipping product, handling returns, and invoicing customers. As complexity and disruptions abound in the global supply chain, it is no longer sufficient to simply have an ERP system. To thrive during these volatile times, an increasing number of clients are upgrading to modern ERP systems to better support evolving customer requirements, increasing automation and efficiency needs, and predictive analytics capabilities.

In 98% of the client situations, having an ERP system is required to support SIOP success. The only reason we didn’t use 100% is that we worked with an innovative building products manufacturer still using QuickBooks Enterprise to successfully roll out a SIOP process. They were the exception to the rule as they had a CRM (customer relationship management) system and an Excel based forecasting system in place, were progressive in nature, had put process disciplines in place and were in process of selecting an ERP system. The main reason an ERP system is essential to SIOP is because you’ll need to capture demand and supply information to roll up into your SIOP process. Although at times it can prove valuable, it is NOT required (and sometimes not preferred) to use detailed transactional data. On the other hand, there is key demand and supply data stored in your ERP system that will be integral to your SIOP process.

Do You Need to Upgrade from an Outdated ERP System to a Modern ERP System to Implement SIOP?
No, you don’t need to upgrade to a modern ERP system to implement SIOP. Although you will likely improve upon your demand and supply data with a modern ERP system, we have worked with many clients with archaic systems to successfully implement SIOP and achieve results. In most of these situations, they had an ERP upgrade on their IT roadmap but didn’t want to delay progress in getting in front of their customer demand and EBITDA performance. From a SIOP point-of-view, so long as you can get data out of your ERP system, you will have what is needed to succeed.

Do You Need a CRM System to Support SIOP Success?
No, you don’t need a customer relationship management (CRM) system to support SIOP success. With that said, you need CRM type information to support SIOP success. For example, you need to gain sales and customer input to changing demand patterns, new customer opportunities, the strength of key regions and product lines, etc. So long as you can gain access to this information through verbal feedback, spreadsheets or via an extract from CRM, the SIOP process will be successful.

Many of our most successful SIOP clients have a CRM system even if they do not directly tie the CRM system data to the SIOP process. What we see is that as clients use a CRM system, they develop the appropriate process disciplines to improve upon the sales and customer input to the process. For example, a building products manufacturer captures potential business opportunities in Salesforce, but they do not tie the information directly into their SIOP process. Instead, they involve key sales leaders who interpret the CRM data, add market intelligence, and collaboratively build a sales forecast in support of the SIOP process. Results follow. On the other hand, an industrial products manufacturer uses Oracle’s CPQ/ Big Machines, and by connecting that information directly to the SIOP process, the client gained an immediate benefit of visibility to future sales.

Do You Need a Forecasting System to Support SIOP Success?
No, you don’t need a forecasting system to support SIOP success. The majority of our clients including many large, global manufacturers with several facilities across multiple countries implement SIOP successfully without having a demand planning / sales forecasting software. On the other hand, you will need a picture of future demand.

In every SIOP project, we have worked with the client to develop a demand plan. Whether high-volume make-to-stock (MTS) items or make-to-order (MTO) items such as configure-to-order (CTO) or engineer-to-order (ETO) items, you will need a demand plan. In order to look into the future to make the appropriate strategic decisions (manufacturing sourcing, capacity allocation, supply chain network, strategic inventory), you have to start with your expectations of future demand.

Many times, you can build a demand plan using an Excel model. It will be sufficient to get the process started and results occurring and can be automated and upgraded down-the-line. In other situations such as in high volume industries with complex supply chain networks, a forecasting software is recommended to best support your needs in a sustainable way; however, it won’t prevent you from getting started with a simple forecast. If your process would benefit from a forecasting system, there are many software options, ranging from the simple to the sophisticated.

Translating Your Revenue Plan into an Operational Plan
Once you have a sales forecast in dollars, the key is turning revenue projections into directionally correct unit forecasts and resulting capacity and supply plans. If using a software, it should convert from dollars to units easily. With that said, it is frequently more complex than a simple conversion factor. Thus, this translation of dollars into meaningful units is often one of the top drivers of SIOP success.

For example, a life sciences manufacturer brought us on board to specifically turn their revenue plan into a directionally correct operational plan. They could see the dollars coming in the door, but the operational leaders didn’t know how many people would be required, which skills would be needed, or which long-lead time materials to order because they couldn’t translate the demand plan into a consistent and standardized unit of measure. Thus, although they had long-term visibility to revenue, they couldn’t fulfill the revenue on a timely basis without taking on too much risk. By rolling out a demand planning process and turning dollars into standard and meaningful units of measure, they were able to quickly gain the appropriate approvals to hire the appropriate skills, reallocate resources, and purchase the equipment to support their growth plans. They aligned their demand and supply plans.

Similarly, a drone manufacturer had intense specificity with their revenue plans but they could not translate revenue into material purchases so that they could plan ahead with suppliers to secure supply with reduced cost. We worked with the client to devise a process to translate revenue into unit sales by product grouping which were translated into key materials and commodities. We were able to provide a conservative, directionally correct forecast for key suppliers so that we could gain the appropriate approval to put supplier agreements in place to support business growth with shorter lead times and significantly reduced costs.

Both clients had CRM systems although neither used CRM data directly to start the SIOP process as it would have held up progress. Instead, we used data and insights from CRM to support the development of a sales forecast/ demand plan which translated into an operational / purchase plan. It just so happens that neither client had a forecasting system. We developed a demand planning model in Excel that used information from their ERP system to support SIOP in both instances.

Do You Need a Business Intelligence (BI) Software to Support SIOP Success?
No, you don’t need a business intelligence (BI) software to support SIOP success although having business intelligence and analytic capabilities will enable success. At a minimum, you will need to be able to extract data from your ERP and related systems and combine with spreadsheets and other data. On the other hand, if you have a business intelligence system, it is likely you’ll be able to get access to the appropriate data more quickly, analyze trends and slice and dice the information as a part of SIOP to turn data into data into insights.

On the other hand, we frequently see clients get hung up in creating the ideal reporting platform, and miss the forest for the trees. As much as standardization of information and pretty charts and graphs might be a nice end state objective, delaying SIOP progress will cause more harm than benefit. The most successful clients start with directionally correct, immediately available information and continually improve upon and refine the information with changing circumstances. They summarize key highlights into a few charts and graphs using PowerPoint and bring clarity to pivotal decisions through the SIOP process and executive SIOP discussion. As advanced BI functionality can be incorporated in a meaningful way, it will be a great addition to the process.

Do You Need Supply Planning Software to Support SIOP Success?
No, you don’t need a separate supply planning software to support SIOP success. For most clients, your ERP system will support your supply planning needs. Capacity planning, production planning, distribution / replenishment planning, material planning and logistics planning are supported with ERP. In some situations, an advanced planning software is preferred to support advanced replenishment needs and/or production scheduling requirements.

Whether you implement SIOP or not, this type of software better supports service, cost and inventory objectives in certain situations. For example, a consumer goods company used an advanced planning software to reallocate orders and capacity between sites and to replenish service centers to ensure high service levels to customers. Similarly, a healthcare products manufacturer supplied its customers’ locations (vendor managed inventory) based on replenishment methods with an advanced planning software.

Do You Need Financial Planning & Analysis Software to Support SIOP Success?
No, you don’t need financial planning and analysis software to support SIOP success. Some ERP software options have robust financial planning capabilities whereas the rest will minimally provide data that can be used in Excel or with a separate financial planning software. Many clients already have add-on software modules to support financial planning, or they have set up business intelligence to support financial planning and analysis. Alternatively, they could utilize S&OP software analytic capabilities.

The Bottom Line on SIOP Software
If you research SIOP software, you’ll find several high-powered solutions rise to the top. However, in most instances, these SIOP software options will include demand planning, supply planning, advanced planning, financial planning, and related BI analytics. Thus, if you need one or more of these options or want to take your processes to the next level, it could make sense to pursue SIOP software. On the other hand, we’ve yet to find a situation where SIOP software was required to implement SIOP and gain substantial results. It is far more likely you’ll need a forecasting software or business intelligence/ reporting and analytics software to supplement your ERP system and support SIOP than anything else near-term.

Different SIOP software options have different strengths in supporting different types businesses such as high volume consumer products companies to highly configured-to-order (CTO) and engineered-to-order (ETO) environments. There are also SIOP software options which are better known for strong demand planning functionality, strong financial planning and analysis capabilities, etc. Typically, these software options will only make sense for larger companies because the implementation cost can be substantial.

For the vast majority of companies, substantial progress and dramatic results can be achieved by implementing a SIOP process, using the existing ERP system and related data. In certain situations, a peripheral software such as forecasting and/or BI would add value although will not hinder progress. However, for the right situation and company, a SIOP software can add substantial value and increase sustainability. Thus, of course, the bottom line is that “it depends”.

Data & People: Priorities for Success
Although SIOP-specific software isn’t required to roll out a SIOP process, data is critical. Thus, focusing efforts on cleansing, connecting and consolidating data should be a priority. In addition, focusing attention on your SIOP team will prove invaluable. The most successful SIOP projects have engaged teams, strong leaders, involved sponsors, and they are supported by data analysts/ technical experts. Start by paying attention to your talent and results will follow.

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Every successful client is experiencing rapid growth and changing customer requirements. To support this growth in a scalable, profitable manner, turning data into insights is of paramount importance.

Data Overload

Every client has an overload of data. Whether using a modern ERP system or struggling with a complex maze of manual spreadsheets, the one item in common is an abundance of data. We have worked with clients with archaic ERP systems, but so long as we can extract data, progress can be made. On the other hand, we have worked with clients with Tier 1 ERP systems such as SAP or Oracle, but if they cannot get data out of their systems, the client is in a worse situation than the one with an archaic ERP system. Every manufacturer has products, defines how to produce those products (whether captured in someone’s head, in spreadsheets, or via an ERP system), has customers, receives orders, purchases from suppliers and so on. Each of those transactions and associated data is stored somewhere.

Data and related transactions adds up quickly. If you think about your typical day, you receive an overload of data before you even arrive at work. Your phone gives you the latest news and alerts. The news provides additional insights into key events. You drive by billboards and listen to the radio or talk with people on your way to work. You receive automated reports in your inbox. You most likely receive thousands of inputs before even arriving at work. Its no wonder we are overloaded! Since the pandemic might have cut out your drive, you might have replaced it with a walk or workout although you are still receiving data via the radio, a podcast or on the phone. To make matters worse, we employ people to run reports and track metrics on spreadsheets. Every time corporate, a Board member or a customer asks a question, another metric is created. Soon, we employ loads of people to publish data that no one uses to make decisions. How do we throw a line to save ourselves from drowning in data?

Take Stock of Your Data

Collect your data. It is likely to be an eye opening exercise. Take stock of standard reports your ERP system provides. Find out which reports are run frequently, and ask those people what they do with the information. Find out if the reports have to be massaged or adjusted to provide useful information. What has to be changed and why? Take a survey of the metrics your organization is collecting, tracking, or publishing. Ask who is using the metrics and what decisions are made based on the information.

In addition to understanding the volume and use of data, check into your data accuracy. Can folks make directionally correct decisions with your data? Or are there several exceptions that have to be discussed before taking action? If someone not intimately familiar with the data evaluated the report or dashboard, could he/she make a decision?

Reduce the Number of Reports to the Meaningful

We have not yet met a client that wasn’t collecting too much data. It is easy to get too ambitious and lose track of what is meaningful. Ask who would notice if the reports weren’t completed for a week? Go talk to that person and find out why. If no one knows or has a compelling reason to review the report, turn it off or tell the person compiling the information to stop compiling it for the next week or month. See if anyone asks about it.

Attend the meetings where data is discussed. Are people arguing about data or having meaningful discussions about what to do based on the data? If they are debating the accuracy, get the group together to develop ONE report that everyone agrees upon to illustrate the data. Eliminate the rest. For example, a building products manufacturer had several nuances to how they calculated OTIF (on-time-in-full), and so the team would debate the way the data was captured at each meeting instead of acting upon the data. We took a step back and aligned on the meaning of fields, how the data was captured and used, and we consolidated several reports into one cross-functional process to collect and analyze a single source of data. Although it certainly wasn’t the only reason, having meaningful reporting supported key decisions and actions which led to an increase in OTIF by 30%.

Turn Data Into Insights

Simply reducing the number of reports isn’t enough. It is essential to make the information meaningful for decision-making. Understand your sources of data. Connect the data. Cleanse the data. And turn data into insights with dashboards, data models or simply by retrieving the appropriate data for decision-making. It sounds much easier to do than it is in reality. For example, an aerospace client captured open orders and shipment data. Because they selected the data by the order creation date instead of the shipped date, the reports didn’t contain the correct information and didn’t reconcile to the invoicing data. Additionally, because they didn’t have their customer segregated in a key field they used to pull the report, the records that were blank didn’t get captured. Both were easy fixes but poor decisions were being made until the data was reconciled and cleansed. On the other hand, once the data was directionally-correct, they used it to determine the machine capabilities, capacities and staffing required to support their growth plans so they could get in front of their demand.

In another client, they had a proactive executive team for a small, rapidly growing building products company. They tracked potential sales leads, probability of success, sales history by geography and much more in their CRM system. Thus, they knew they needed to focus efforts on a key product line in the northeast because sales were lower than expected. By having this key information at their fingertips, they could target their sales efforts on the customers, products, and locations that would make a meaningful difference to their growth plans. They were recognized as the fastest growing company for several years in a row due to the expert ability to turn data into insights and take appropriate action.

You can turn data into insights no matter what systems you have supporting your business. It is far more important to have the appropriate processes and to focus people’s attention on how to dig into data and use it to make meaningful decisions. With that said, if you can support your data efforts with a business intelligence solution, you will gain a leg up on the competition. The great news is that BI tools are scalable; start small and scale up with complexity as it makes sense to support your business. Once you can slice and dice data and have dashboard available with the push of a button, consider moving on to advanced data topics such as predictive analytics. Instead of solely using data for decision-making, you can take it to the next level and predict your future to get ahead of pack.

Did you like this article?  Continue reading on this topic:
Thriving Post-Pandemic: Turning Data into Insights

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The Future of Technology

Technology is a tricky topic. On one hand, almost everyone has put technology and ERP implementations on hold due to concerns about COVID impacts and to conserve cash. On the other hand, it is the best time to gain employees’ attention and focus to upgrade technology to scale the business, create a superior customer experience and deliver bottom line results.

Kellogg or Post?

As I said in my eBook, Future-Proofing Manufacturing & Supply Chain Post COVID-19, the Kellogg vs. Post story from the Great Depression provides an excellent example to ponder. In the 1920’s, Kellogg and Post dominated the market for cereal which was still a relatively new and untapped market. Post reigned in expenses and Kellogg doubled its ad budget and pushed its new cereal. Even as the economy hit bottom, Kellogg’s profits rose 30% and they become the dominant player.  Do you want to be Kellogg or Post? The morale to the story is NOT about dollars invested. It is about the opportunities of investing resources (which can be simply in the form of employees’ focus) in future success.

Which Technologies Provide Immediate and Long-Term Value?

Of course, the answer depends on your industry, company, current infrastructure, your customers’ evolving needs, your suppliers’ evolving needs and more. Why not perform a rapid assessment of what makes the most sense for your business and take one important step forward? As I said in my eBook, Newton’s Law is relevant. Objects in motion stay in motion whereas objects at rest will stay at rest. You must take steps forward, no matter how small. Let’s highlight a few of the more likely technologies to provide immediate value and long-term value:

1. Further utilize & expand your ERP system: No one uses 80% of their system; however, most organizations utilize only 20%. Find that next 1% that will yield a significant benefit to your customers or bottom line. Clients are gaining significant value from this simple step.
2. B2B customer portal/ B2C e-commerce: No doubt about it. The ONLY growth area across the board is e-commerce. In addition, what could be more important than visibility of orders for your B2B customers? Delays will result in lost opportunity!
3. Business Intelligence (BI): We are overloaded with data. The issue isn’t having data, it is making meaningful decisions and formulating plans based on the interpretation of data. BI will bring meaning to your data that translates into customer and profit opportunities.
4. Artificial intelligence (AI) & Human Learning: In today’s environment, predictive capabilities produce VASTLY greater results than simply analysis and static plans. Demand planning/ forecasting, predictive maintenance, cash flow forecasting, and the automation of tasks are enhanced with AI.
5. CRM: There has never been a time when understanding, staying in touch with and being on top of evolving customer needs has been more important.
6. Digital Twins: virtual replicas of physical devices that technology gurus can use to run simulations before actual devices are built and deployed. Read a fascinating article about the applications in logistics.
7. Systems to gain efficiencies: WMS (warehouse management), TMS (transportation management), rate shopping, MPS (master production scheduling)/ MRP (material requirements planning) / Inventory planning, replenishment including VMI (vendor managed inventory) and more.
8. 3D Printing/ Additive manufacturing – if you can produce a customized product on demand close to customers, you win in today’s Amazonian environment. Either way, it speeds up R&D.

Read our eBook, Future-ProofingiManufacturing & Supply Chain Post COVID-19 to read more about technology as it relates to successfully emerging and thriving post-COVID-19. Explore these concepts further as you start thinking through your technology roadmap.

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A Client Question

When clients decide to upgrade ERP, they also look at CRM (customer relationship management) because it makes sense to align the technology infrastructure into a common platform that will be fully integrated and scalable. However, what if it isn’t part of an ERP project? When does it make sense to jump into the CRM world? One client asked us just this question.

The Answer

In their case, they could achieve a powerful return on investment with CRM. It provided the tools and technology that would strengthen their relationship with their current customers as well as help them expand sales with current customers and create a pipeline of new customers. Specifically, when meeting with customers, the sales reps gained insights into customer preferences and ways to strengthen the relationship. If they captured those ideas into CRM on the spot, the next person who interacted with that customer could see the notes and tailor the conversation. These seemingly small preferences can go a long way!

In terms of expanding business, they needed robust sales reporting that would tell them if they were falling off in a particular area or if they sold one product without its complimentary product so that the sales rep could follow up. Last but not least, they wanted a way to track potential new customers and expansions of business. For example, if a reseller was opening a new facility, they wanted to track it in CRM so that everyone had access to the timing, forecast, and other critical information. Also, since it was a collaborative sales environment, they wanted a way to track potential new customers and where they were in the sales cycle so that they could forecast future sales and the likelihood of it occurring. Sales forecasts were the 80/20 of success in this client because it was in a high growth mode where cash forecasting is of critical importance.

A simple CRM solution fit the bill. A few years later, they were ready to upgrade their ERP infrastructure. At that time, they had the base CRM disciplines functioning and so it was an easy transition to a fully integrated system with CRM functionality. This client has been recognized multiple times for its substantial growth and success.

Food For Thought

Although CRM systems can be a great idea (as it was in our client’s case), if your sales and support teams aren’t ready to enter at least the key data, you’ve just bought an Audi that sits in your garage. Start implementing process disciplines early. Enter information about your customers that will be handy at a later date. Start tracking key meetings and prospects. Are you able to make good decisions from what you are tracking? If not, wait! However, aggressively push to start tracking vital information about your customers, even if you put it in Outlook or a spreadsheet to start. Soon you’ll be ready for a simple CRM solution, followed by more powerful ones as you get used to driving your car on city streets, you’ll be ready to brave the freeways. If you are interested in running your situation by us, contact us.

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CLAREMONT, CALIFORNIA (May 2, 2019) –  Manufacturing and Supply Chain Expert Lisa Anderson, MBA, CSCP, CLTD, president of LMA Consulting Group Inc. considers internal and collaborative systems to be critical to short- and long-term growth for manufacturers and distributors. Systems must be able to support scalability and sustainability, enabling a resilient supply chain, superior customer experiences and peak financial performance.

“In today’s Amazonian environment, customers expect rapid delivery, over and beyond cradle to grave, collaborative service, 24/7 accessibility and last-minute changes. Executives are realizing their technology infrastructure must be able to meet and exceed these customer expectations while driving bottom line improvement” notes Ms. Anderson.

ERP, CRM, e-commerce, customer portals and related technologies are integral to success. “Many times, the systems are blamed for internal issues or challenges. Sometimes, it’s because they are out of date or a hodgepodge and don’t support the business.  Other times, the systems have the capabilities but are just not being used properly. We have seen clients ready to ‘throw out’ a perfectly suitable ERP system because they think the system is the problem rather than how it ties with the people and process” she continued. 

Ensuring that the executive team is involved in ERP and system evaluations from a strategy viewpoint is critical.  “Since the system will impact market share, customer experiences and bottom line results, it is key treat ERP as a strategic priority,” she said.  Internal systems should reflect business objectives, cultural norms (entrepreneurial vs. approvals) and multi-department requirements and priorities. In today’s Amazonian environment, the only way to thrive is to leverage advanced functionality to automate, collaborate and utilize predictive analytics to make sound business decisions to set strategy,” Ms. Anderson concluded.

LMA Consulting Group works with clients on manufacturing strategy and end-to-end supply chain transformation that maximizes the customer experience and enables profitable, scalable, dramatic business growth, including ERP evaluation and selection. “ERP is a tough topic. Clients worry they are too small, or it will be too expensive. Meanwhile, the competition passes them. Using technology that supports a superior customer experience without breaking the bank is a “must”, regardless of size or industry” she concluded. 

LMA Consulting Group just released the findings of manufacturing executive predictions for 2019:  “Manufacturing & Supply Chain in the New Normal” (available at no charge). 

About LMA Consulting Group – Lisa Anderson, MBA, CSCP, CLTD

Lisa Anderson is the founder and president of LMA Consulting Group, Inc., a consulting firm that specializes in manufacturing strategy and end-to-end supply chain transformation.  She focuses on maximizing the customer experience and enabling profitable, scalable, dramatic business growth. Ms. Anderson has been named a Top 40 B2B Tech Influencer by arketi group, a 50 ERP Influencer by Washington-Frank, ranked in the top 46 most influential in Supply Chain by SAP and named a top woman influencer by Solutions Review. She recently published, I’ve Been Thinking, an inspiring collection of 101 strategies for creating bold customer promises and profits. A regular content contributor on topics including providing a superior customer experience with SIOP, advancing innovation and making the supply chain resilient, Ms. Anderson is regularly interviewed and quoted by publications such as Industry Week, tED magazine and the Wall Street Journal.  For information, to sign up for her Profit Through People^TM Newsletter or for a copy of her book, visit lma-consultinggroup.com.
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Media Contact
Kathleen McEntee | Kathleen McEntee & Associates, Ltd. | p. (760) 262 – 4080 | KMcEntee@KMcEnteeAssoc.com   

Originally published on ExpertClick on May 2, 2019                                             

The post Press Release: Manufacturing & Supply Chain Expert, Lisa Anderson, Considers ERP, CRM and Related Systems Key to Enabling Scalable, Profitable Growth appeared first on LMA-Consulting Group, a supply chain consulting firm.