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ERP System ROI – How Small Businesses Can Achieve ROI from the Purchase of an ERP Software Solution

Tuesday, November 17th, 2009 by Alex Smith

While there are some similarities between the ways in which larger corporations and small businesses achieve a return on investment from the purchase of an ERP solution, the benefits to be realized from an ERP system implementation for small businesses tend to be more intangible in nature and, at least initially, less measurable. That being said, small businesses who have grown to the point where their existing small business software’s functionality no longer meets their business needs can gain several benefits from a fully-integrated ERP system that will lay the groundwork for future business growth and more efficient, streamlined business operations. Some of the benefits a small business can realize from an ERP solution include:

  • Time savings due to the elimination of duplicate data entry. A small business ERP solution can allow the organization to operate on a single software platform. Unlike many small businesses who use one software solution for accounting and financial management, Microsoft Excel to maintain inventory levels, and a separate software package to manage customer orders and purchasing, the small business who utilizes an ERP system can manage all business transactions in a single software package that maintains accurate data for all of the company’s departments. Rather than entering an order in one software package, updating the inventory data for the ordered item in Excel, and then making the necessary accounting entries in a third software package, an ERP system can automate such processes and eliminate the need to maintain products, customers, vendors, customer orders, inventory data, and financial accounts in separate software solutions. In addition to reducing employee time spent on maintaining such data across a multitude of software applications, an ERP system can help small businesses improve data accuracy and integrity, as the likelihood of entering incorrect data is significantly reduced due to the simple fact that data does not need to be entered multiple times.
  • Faster order entry and processing. By having the company’s customer service, warehousing, and accounting departments integrated in a single ERP system, small businesses can gain significant improvements in customer service. In TGI’s Enterprise 21 ERP software, the system tracks customer order history and buying habits to show customer service personnel the items a given customer orders most frequently during the order entry process. Such a feature can allow the customer service representative to enter orders quickly and easily. In addition, the customer service representative has immediate visibility to real-time order status to communicate to the customer when their order is being picked, packed, and shipped. Furthermore, should the small business choose to integrate the ERP system’s back-end e-Commerce functionality into the company’s website, customers can place Internet orders while still having access to their customer-specific product pricing, promotions, and volume discount opportunities, allowing for more automated order processing and giving the small business the opportunity to process a larger volume of orders on a daily basis.
  • Flexibility and scalability. When a small business makes an investment in an ERP software solution, it is making a decision for the future benefit of the company that will ultimately result in significant cost savings in the years following software implementation. An ERP system that offers a flexible, configurable architecture can deliver the software functionality the small business needs today and the scalability to take advantage of additional functionality as the business continues to grow without having to invest in a new software package, higher implementation costs, and additional services fees for employee training.

Purchasing an ERP system is an investment in every sense of the word for organizations of any size; however, small businesses can take advantage of the benefits to be realized from a fully-integrated software platform today and additional functionality in the years following implementation as the business continues to grow.


Visit the New TGI Resources Library for Enterprise 21 Demonstrations, Software Selection Tools, and more

Monday, November 9th, 2009 by Alex Smith

We recently released the TGI Resources Library. Aside from being able to access Enterprise 21 ERP software demonstrations and view past TGI webinars, one of the most useful aspects of the TGI Resources Library is that it gives site visitors immediate access to all of TGI’s ERP selection resources, including the complete version of TGI’s Software Selection Tool Kit. The tool kit is designed to provide software selection teams with the necessary resources for conducting a thorough, well-structured ERP selection process with a comprehensive and quantitative analysis of various ERP vendors and solutions. From the SSTK Downloads page, site visitors can download any of TGI’s software selection resources individually or download the complete Software Selection Tool Kit as a single executable file. With the conclusion of 2009 rapidly approaching, manufacturing and distribution organizations who plan to select a new ERP system for implementation to begin in early 2010 can leverage TGI’s Software Selection Tool Kit as a guide for their software evaluation projects.


Enterprise 21 ERP Software with Integrated Business Intelligence Functionality Makes Decision Support Available to Executives, Management, and Individual Contributors

Wednesday, November 4th, 2009 by admin

There was a time when business intelligence solutions were reserved for very few business leaders.  Only those executives who really understood technology were willing to spend the money necessary to have a business intelligence system put in place that would take data out of their ERP software to populate a completely separate data warehouse for analytics purposes.

The time and cost to implement and make this functionality available made it cost prohibitive to nearly all small and mid-market businesses.  And for those few enterprises that were willing to invest in this technology, only a small core set of executives (read one to two players per company) would have access.

However, fully-integrated ERP software solutions, like TGI’s Enterprise 21, offer complete business intelligence functionality out of the box as part of the application’s core product offerings.  With Enterprise 21, each user can have his or her own unique series of dashboards.  Each dashboard tab can consist of up to four panes.  The data content and manner in which one views the data can vary from pane to pane.

Some users, for instance, may like to see raw data in a spreadsheet-like grid format.  Others may be more visual in nature and want to see the same data in a graphical format.  For those who want to view data in graphs, there are a variety of formats that one can choose from including line charts, bar charts, pie charts, area charts, and scatter charts.

In addition to displaying graphical and tabular data, Enterprise 21’s dashboards can also display gas gauges for rapid review of key performance indicators for the organization.  Maps can also be displayed including ones consisting of prospects and customers which are color coded based on odds or size of the given business enterprise.  Finally, for those users with security permissions to do so, financial reports which are produced from within Enterprise 21 can be displayed in dashboards.

One of the key advantages of the dashboards is that users can open the underlying data for analytical purposes.  In doing so, one can perform analytical drill down of data being shown across a series of dimensions.  For example, one might be looking at a graph of sales revenue over time.  This data can be sliced-and-diced across dimensions including drilling down by customer groups to as granular a level as a specific customer and product groups as deep as a specific product.  One might also want to review specific geographic regions or states, specific facilities, and specific sales regions, branches, and territories.  Through this simple description, it should be clear that application users can analyze core business data at any level of detail necessary to make well-informed business decisions.

In addition to sales-related data, all functional areas of the business can have their own series of dashboards including inventory management, warehouse management, customer service and sales order management, manufacturing, purchasing, and accounting, including financial reporting, accounts payable, and accounts receivable.  Furthermore, key external data such as new building starts and commodity market futures prices can be pulled into the system and trended for analysis purposes.

Because business intelligence functionality is built directly into the fully-integrated Enterprise 21 ERP software, TGI’s customers don’t need to invest in totally separate software solutions which it then has to implement and manage to gain these analytical capabilities;  rather, TGI customers can take advantage of complete business intelligence functionality as part of their investment in Enterprise 21.


Visit TGI at the 2009 STAFDA Technology and Consultants Fair

Tuesday, October 27th, 2009 by Alex Smith

On November 9, 2009, TGI will be attending the 2009 STAFDA Technology and Consultants Fair. TGI representatives will be on hand to showcase TGI’s Enterprise 21 ERP software at Table 6. Conference attendees may arrange for a personalized demonstration of Enterprise 21 while at the STAFDA technology fair. The fair offers a great opportunity for organizations in the specialty tools and fasteners industry to see the latest in business management software technology and gain an understanding of the many benefits a distribution organization can derive from integrated distribution software solutions.

Given such an opportunity, business executives and IT professionals in the tools and fasteners industry should come to the STAFDA Technology and Consultants Fair armed with key questions for software vendors that pertain to their unique industry requirements. Some examples of key questions for software vendors who supply solutions for the tools and fasteners industry include:

  1. What does the software system offer in terms of managing pricing methodologies, promotions, and allowances?
  2. What types of inventory management and replenishment methodologies does the software offer?
  3. Does the system include integrated RF and barcode technology to operate the warehouse in a paperless environment?
  4. Does the software offer integrated procurement functionality that provides RFQ processing, vendor performance management, designation  of a preferred supplier for a given item, accounting for supplier lead times, etc.?
  5. Does the software provide integrated e-Commerce functionality for Internet-based orders?
  6. Does the software interface with EDI translations?
  7. Does the software interface with UPS, FedEx, and LTL shipment manifesting systems concurrently?
  8. Does the software offer both available and capable to promise order management functionality?
  9. Does the software account for landed costs, import duties, drayage charges, etc. for imported items?
  10. Does the software offer MRP/DRP functionality?
  11. Does the software provide functionality for kitting, assembly, light manufacturing, and other value-added services?
  12. Does the software offer integrated financial management?
  13. Does the software feature business intelligence, analytics, and reporting functionality with drill-down capabilities?

While these are just some of the many questions for software vendors, they should provide a good basis for discussion in limited time while at the 2009 STAFDA Technology and Consultants Fair. If you plan on attending the 2009 STAFDA Technology and Consultants fair and would like to schedule a demonstration of TGI’s Enterprise 21 software, please click here to complete TGI’s 2009 STAFDA registration form.


Wholesale Distribution Software: Big Productivity Gains Await Distributors Who Ship Small Package Deliveries

Monday, October 19th, 2009 by admin

Many of the wholesale distributors with whom we work have common characteristics when we first become acquainted with each other.  Many are selling items which can be packed and shipped via small package delivery services.  And, most of these distributors are performing their picking operations via paper-based print tickets on a one-to-one ratio – one sales order equals one pick ticket.

Some of the biggest operational efficiencies these distributors can gain from wholesale distribution software solutions like TGI’s Enterprise 21 come from combining and performing picking for multiple orders concurrently.  Within Enterprise 21, this functionality is called cart picking.

Enterprise 21 collects a series of picks for various sales orders based on the business rules a given organization defines within the system.  Once a pick is generated, Enterprise 21 leads the given warehouse operations person through the facility in an optimized path to minimize transit time between picks.  This can be done with either paper-based or paperless picking.

When cart picking is combined with barcode scanning, the Enterprise 21 system prompts the picker to pick a given quantity of an item from a specified bin location and to place that item in a specific tote or location on their picking cart.  When the first item is being picked, the picker scans the item and an associated tote location on the picking cart.  At this point, the system knows that a given order’s picks are associated with that specific cart location.  When the picker is prompted to pick the next item, if it is associated with this same order, they are prompted to place it in this same tote location.  Should they be picking an item for a second order, however, they would be prompted to scan a second cart location to be associated with the second order.

The system will continue to prompt the picker to place items into an associated tote location or to select a new location for the next order being picked.  Should the picker attempt to scan and place an item associated with one order into a cart location associated with a different order, the system will alert them that this is not the correct location for this order and once again prompt them with the correct cart location.  Once all the associated picks for the given picker-cart combination are finished, the picker would take the cart to the packing location.

Next, Enterprise 21 would prompt the packer as to which specific standard carton sizes should be selected for use for a given sales order shipment and which items should be placed in each given box.  The system would generate a carton label for each box.  As the packer scans the items into the given cartons, the system would confirm that the items were in fact associated with the specific order shipment being created.  As part of the packing process, Enterprise 21 also generates the desired shipping paperwork including packing slips and pro forma invoices.

Once the packing process has been completed and the cartons are sealed, the boxes would then be handed off to the shipping department.  Shipping would then run the boxes through the appropriate shipment manifesting systems (i.e., UPS, FedEx, etc.) and ship the various boxes.  Enterprise 21 is fully-integrated with these shipment manifesting systems, so the order status would be updated immediately upon shipment.  Enterprise 21 also generates all appropriate customer transactions resulting from the shipping process including delivery of an advanced shipping notification (ASN) in the customer’s preferred format and method of delivery (fax, email, or EDI).

The combination of Enterprise 21’s fully-integrated warehouse management system functionality when used in conjunction with RF/barcode-enabled scanning technology, including cart picking and wireless warehouse management capabilities, can lead to substantial improvements in warehouse operational efficiencies while minimizing shipping errors.


Process Manufacturing: Managing Batch Processing and Fill Lines

Friday, October 16th, 2009 by admin

Many process manufacturers have operations where they will produce a common product that is then packaged into a variety of containers for various customers.  These manufacturers will frequently produce this common product via a batch process.  This formulation produced may be an intermediate that then gets combined with other items to produce finished goods, or it may itself be a finished good awaiting packaging operations.

After the batch is produced, the product can either be moved immediately to filling operations or placed in drums and stored in the warehouse for some period of time.  Once the formula is in the filling operation, finished goods are produced in various sized containers with associated product labeling to meet customer demands.

So, how does Enterprise 21’s process manufacturing software functionality enable these batch process manufacturers to perform their jobs efficiently?  First, one can establish a scalable batch formula that consists of the various ingredients needed to produce the intermediate formulation.  The formulation can be setup as a recipe, where the ingredients and associated process instructions are combined in an order of operations to produce the desired output.  Where necessary, the recipe can also have electronic signatures required for individuals to sign off at various checkpoints during the process for compliance and quality assurance purposes.

The formulation may have certain ingredients that are generally over consumed as part of the production process.  Let’s say that a given production process may require a standard of 100 pounds of a given ingredient to produce a given batch size; however, if that process is not 100% efficient, the system can enable the planning of consumption of more than 100 pounds of that ingredient – say 102%, or 102 pounds of that ingredient for the given batch size in consideration.  In this situation, Enterprise 21’s yielding functionality within the formulation is used in the procurement and production staging processes to account for the fact that 102 pounds of the given ingredient are needed to perform the given operation.

Once the intermediate formulation is produced, there may be a period of time necessary for cooling required before the output can be packaged into a drum or moved to the filling operations.  In this case, one can build queue time into the end of the given production routing step so the associated cooling time is accounted for prior to scheduling and ultimate performance of that next operation.  This is done within Enterprise 21’s manufacturing routing functionality.

Finally, the filling operations can be scheduled as a series of work orders to produce the ultimate finished goods.  The bills of material for the various finished goods would, at a minimum, be comprised of the intermediate formulation produced as described above, the appropriate container for the given product, and its associated label.

In addition to the functionality described above, Enterprise 21 also manages product costing – average, standard, LIFO, or FIFO – on a product-by-product basis, all of the associated inventory and warehouse transactions including complete womb-to-tomb lot traceability to support recall management, and all associated financial accounting transactions in a real-time, fully-integrated system.


Implementing on a Time Crunch

Thursday, October 1st, 2009 by Alex Smith

With the beginning of 2009’s fourth quarter starting today, companies of all sizes find themselves in a hurry to complete their ERP software evaluation process, begin software implementation, and prepare their organizations for initial system go-live on the first Monday of 2010. ERP system implementation is a time consuming task for any organization. Implementation requires a coordinated effort on the part of both the software provider and the manufacturer’s or distributor’s implementation project team leaders. Given the sophisticated, complex nature of ERP systems, there are two relatively easy ways in which an organization can implement a new ERP solution before the end of 2009 and be in a position to go-live January 2010.

Prepare your data. One of the most tedious, time consuming activities that occurs during the ERP implementation process is data migration. Companies need to have their data prepared in a computer-readable file format to import their data into their newly selected ERP system. Data accuracy and integrity is critical to the ERP solution’s performance both before and after production go-live. By having data such as GL accounts, customers, products, parts/ingredients, vendors, etc. prepared in a CSV file or other computer-readable format, companies can gain significant time and cost savings during the data migration process as opposed to manual data entry or other highly-inefficient migration processes.

Use the software as designed. Assuming the organization has made the right software selection as a result of their evaluation process, companies should spend little time worrying about miscellaneous modifications that are not critical to initial production go-live. If the organization has conducted a thorough software evaluation and performed a quantitative analysis of various software suppliers and solutions, its ultimate final software decision should have resulted in a software package that meets the vast majority of their business needs with standard, “out-of-the-box” functionality. If the selected software solution does not meet one of the organization’s critical software requirements, it probably wasn’t the right software solution in the first place. In regards to an expedited software implementation, companies should adopt a 90/10 rule, ensuring that 90% of the organization’s software requirements can be met with standard functionality, with the remaining 10% left to focus on minor, non-critical software requirements and enhancements in the first few months following go-live.

By preparing data for migration and using the software as designed, organizations should be ready for a swift implementation and go-live date in early January 2010.


Food Processors and Distributors Require their ERP Systems to Enable Management of Items via Catch Weight Processing

Monday, September 28th, 2009 by admin

Food processors and distributors that produce and sell various meat-based products like those associated with chickens and turkeys have a unique need for catch weight processing.  Catch weight processing is used in wholesale distribution where the item’s actual weight varies from SKU to SKU.

An example of this would be chicken breasts, which could be processed and packed in four-packs for retail sale which are then shipped ten four-packs to the carton.  Let’s say, for example, the average weight of each chicken breast is 4 pounds.  However, the actual weight of the chicken breasts will vary piece by piece.

Therefore, when the retail four-packs are created, the actual weight of the four chicken breasts contained in that package is captured and recorded.  Then, when a series of ten four-packs is packaged into a carton, the actual weight of the chicken breasts in the carton would also be known and could vary from the average weight of chicken breasts in a carton.

Generally, while food processors’ and distributors’ customers would order and receive cartons of chicken breasts for retail sale or food service distribution, the associated customer pricing would be based on a per pound basis.  Therefore, strong ERP software systems like Enterprise 21 must enable food processors and distributors to record two quantities during key inventory transactions like production recording, packaging, and shipping – both the quantity of product cartons and the associated actual weight of the items contained in those cartons.

While retail and food service customers would place orders for a certain number of cartons of chicken breasts knowing each carton would contain ten four-packs with each chicken breast having an average weight of 4 pounds, the customer would be invoiced and pay a price per pound based on the actual weight of the chicken breasts contained in the cartons that were shipped to them.

Food processors and distributors can easily manage those products in their product mix requiring catch weight processing via Enterprise 21.


The Top 15 Signs Your Small Business Software Needs a Makeover

Thursday, September 24th, 2009 by Alex Smith

In my experience working with small businesses and assessing their software needs, the problems small businesses encounter with their existing software tend to be quite similar and do not pertain to a particular industry within the manufacturing or distribution marketplace. Below are fifteen signs your small business software is in desperate need of a makeover.

1.    You use one software package for accounting, a different software package for managing inventories and manufacturing, and a third software package for web orders.

2.    You can’t track lot or serial numbers for raw ingredients and materials through production and shipment to customers in your existing software.

3.    You are frequently out of stock of the products your customers order most frequently and have excess inventory supply of the items your customers never order.

4.    Your accounting software limits you to one costing method for all products.

5.    You enter the same data multiple times due to your use of multiple software packages.

6.    Closing an accounting period is a week-long procedure.

7.    You are forced to cease warehouse, shipping, and receiving operations for several days every three to six months to conduct a complete physical inventory count to try to capture accurate inventory information.

8.    Your physical inventory count consists of somebody hand-counting items in inventory, writing recorded values on a piece of paper, and then entering the information into an Excel spreadsheet.

9.    You don’t know what a cycle count is.

10.    Your existing software limits the maximum number of products you can enter into the system.

11.    Your reporting capabilities are limited to the standard reports in the software you purchased.

12.    You do not have an automated Request for Quote process for your suppliers.

13.    You have no means to track the true profitability of your customers and products.

14.    You have no means of tracking potential new customers.

15.    Your existing software is not capable of telling you the products an individual customer orders most frequently.


Reportable Food Registry – Food and Beverage Processors Must Now Report Issues within 24 Hours via the FDA’s RFR Electronic Portal

Monday, September 21st, 2009 by admin

As of September 9, 2009, food and beverage processors are mandated to report all reportable food incidents to the FDA’s Reportable Food Registry when, “there is reasonable probability that an article of food will cause serious adverse health consequences.”  This mandate applies to all food facilities that manufacture, process, pack, or hold food for human or animal consumption in the United States.  Details of this program are available via the FDA’s Reportable Food Registry resource Web page.

The program includes reporting key data during an initial disclosure and via follow-up reports including items such as the date the article of food was determined to be reportable, a description of the food including quantity and amount, the extent or nature of the adulteration, the result of investigation to determine the cause of the adulteration, disposition of the article of food, and product information typically found on packaging sufficient to identify the article of food.

Once the submission is completed, a confirmation page identified via an Individual Case Survey Report ID (ICSR), including all submitted information, is produced.  This report can be saved as a PDF file and associated with key data elements in the food and beverage processor’s Enterprise 21 ERP system, including customer incident reporting, lot traceability data, and associated customer shipments.

Food and beverage processors are strongly encouraged to review their Comprehensive Recall Management plans and make appropriate adjustments based on the FDA’s Reportable Food Registry mandate.  For an overview of the Reportable Food Registry, please review the FDA’s “Reportable Food Registry (RFR): At a Glance” document.