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Archive for April, 2010

Enterprise 21 ERP: An Ideal Food ERP Software Solution for Producers of Gourmet Sauces, Stocks, and Concentrates

Tuesday, April 20th, 2010 by Alex Smith

A recent article in Bon Appétit magazine highlighted five companies’ alternatives to “homemade” chicken broth. Interestingly, two of the five food processors featured in the article run TGI’s Enterprise 21 ERP software, including More Than Gourmet, a producer of gourmet French stocks and French sauces, and Savory Creations International, maker of Savory Choice Liquid Chicken Broth Concentrate. Aside from the fact that Enterprise 21 is a fully integrated ERP system, there are a number of features in Enterprise 21 that make it an ideal food processing software solution, particularly for makers of stocks, sauces, pastes, and concentrates.

Lot Tracking and Traceability. Integrated food traceability software functionality is a must for any food processor. Enterprise 21 tracks the lot numbers of ingredients and materials received into inventory, the suppliers who provided the ingredient lots, when these lots were consumed in manufacturing, the lot numbers of finished goods produced, and all customers who were shipped a given lot of a given product.

Multiple Units of Measure. Enterprise 21 allows organizations to establish global or product specific unit of measure conversion factors. Food processors and distributors can purchase, manufacture, stock, and sell ingredients and/or products in any unit of measure.

Formula and Recipe Management. Enterprise 21 gives food processors the ability to meet their desired formula and recipe requirements. Enterprise 21 supports multi-level formulations while also providing for ingredient substitutes for a given formula. In addition, each formula can have one or multiple manufacturing routings that consist of a series of steps and instructions to be followed during batch production.

Scalable Batches. Food processors can leverage Enterprise 21’s integrated manufacturing software capabilities when producing varying batch quantities. Enterprise 21 can automatically scale required ingredients in a formula or recipe for large or small production batch sizes.

Quality Control. Enterprise 21 supports the establishment of quality control procedures for food processors and distributors to ensure the highest levels of product safety. Ingredients can be set to be placed on quality hold each time they are received into inventory. Similarly, finished goods can be set to be put on quality hold each time they are produced before they are released into available inventory for customer orders.

In addition, quality control personnel can enter test values for ingredients and finished goods directly into Enterprise 21, release ingredients and/or finished goods from quality hold, or reject ingredients and/or finished goods that do not meet desired product specifications.

Shelf-life and expiration date tracking. Food processors and distributors can leverage Enterprise 21 ERP software for both first-in, first out (FIFO) and first expiry, first out (FEFO) inventory management. Under a FEFO inventory management methodology, Enterprise 21 can automatically allocate specific ingredients and/or finished goods in inventory for production or customer shipments that are nearest to their expiration date to prevent ingredients and finished goods from expiring while in inventory.

Furthermore, should an organization’s customers have guaranteed minimum shelf -life requirements, Enterprise 21 can automatically allocate those items in inventory that will meet each customer’s unique shelf-life requirements on a product-by-product basis.

Production Scheduling and Reporting. In the Enterprise 21 ERP system, production schedules can be created manually or generated automatically. Production schedules can also be re-sequenced with a drag and drop user interface with the system automatically checking for machine and labor availability.

Following production, production quantities can be recorded and measured against their standard (or anticipated) production quantities. Enterprise 21 then monitors actual vs. standard production output to provide the organization with sophisticated material planning capabilities.


ERP Selection and TGI’s No Maintenance Fee Increase Guarantee

Thursday, April 15th, 2010 by Alex Smith

In addition to functional requirements, there are a number of cost-related questions to ask potential software vendors during the ERP selection process, such as:

1. What is the cost of software licenses? Are software licenses sold on a named user or concurrent user basis?
2. What is your average implementation services-to-software cost ratio?
3. Is the software sold on a module-by-module basis, or is it sold as an all-inclusive ERP software product?

A few important questions that are often missed or overlooked during the ERP selection process, however, are:

4. When do you start to charge new customers for annual maintenance?
5. What is your annual maintenance fee, and how is this maintenance fee calculated?
6. What was your annual maintenance fee five years ago?
7. Are software upgrades and future software releases included in your annual maintenance fee?

Questions 4-7 are crucial to the selection process because they can serve as a basis for the selection team to determine not only the most cost-effective short-term ERP solution but the most cost-effective long-term ERP software solution as well. The selection team must have a reasonable understanding of the future costs associated with purchasing the ERP product for the years following ERP implementation.

At TGI, we offer one year of free ERP maintenance from the date of software installation. Given that an ERP implementation may take between three and nine months to complete, we believe our customers should not have to pay maintenance on a software product when they are not using the software in a live transaction environment.

Perhaps more importantly, TGI provides a No Maintenance Fee Increase Guarantee.  We guarantee, in contract writing, that we will never increase the annual maintenance fees charged to each of our customers. This guarantee is designed to provide our customers with a consistent, expected yearly software maintenance expenditure that is free from unanticipated increased fees associated with their software maintenance agreement. We are very proud of the fact that we have never increased our customers’ annual maintenance fees since TGI was founded in 1990.

Why is this guarantee important?

Referring to questions 5 and 6 above, should there be a difference in the maintenance fees an ERP vendor charges its customer today versus five years ago, and the vendor does not provide price protection on their software maintenance agreement, a manufacturing or distribution organization may be subject to escalated software maintenance fees over time. The end result of these unexpected maintenance fee increases could mean that the organization will be forced to allocate funds to their annual software budget that would have otherwise been used for investment in other potential business endeavors.

At TGI, we believe increasing our customers’ annual maintenance fees over time is not the right way to establish long-term partnerships with our customers. As such, we have not and will not increase the maintenance fees we charge our customers over any period of time. Guaranteed.

For a complete listing of questions to ask potential ERP vendors, click here to download TGI’s “50 Questions for Every ERP Software Suppler” white paper.


ERP Systems: Effective Customer Credit and Collections Management to Ensure Strong Cash Flow – as Critical Now as Ever

Thursday, April 8th, 2010 by admin

I had a conversation with a wholesale distributor this morning with whom we’ve been talking for quite a while.  We first started some dialogue with them back in July 2009 about their initiative to evaluate and implement a new wholesale distribution software system.  We had gotten down to their short list and were scheduled to participate in a final on-site demo phase when they called to say they needed to put their project on hold due to other priorities and the economy.

During this morning’s conversation, I was told that during the recent economic slowdown they’ve had some combination of customers who have just stopped paying them to the tune of “several million dollars.”  As a result, they’ve decided they are not going to be in a position to reengage in their software evaluation efforts until at least the summer of 2011.

This story just reinforced how critical it is for all businesses, especially small to mid-market distribution and manufacturing companies, to engage in effective credit and cash flow management practices.  Companies using the Enterprise 21 system can establish a series of dashboards using the decision support functionality in the system to trend total open accounts receivable and past due accounts receivable over time.  This helps executives to spot potential issues before they become critical in nature.  Likewise, in another dashboard pane, management can review open accounts receivable by customer in total and across a series of aging buckets to see how its customers are performing relative to making their payments.  These functions allow for management personnel to take a quick view of accounts receivable overall and by customer to spot where additional interaction might be needed to keep things from spinning out of control.

From an operational perspective, Enterprise 21 also has effective credit and collections management functionality.  When a customer order is entered into Enterprise 21, the system immediately checks whether or not the customer has failed their credit check.  This is done by checking to see if the given customer’s total open orders plus outstanding receivables exceed their available credit limit and by checking to see if their accounts receivable aging has caused an exception based on specific parameters that are established on a customer-by-customer basis.  As an example, a customer could have a credit limit of $200,000, have total open orders plus outstanding receivables of $100 and could have just $1 aged into the over 60 days late aging bucket and have their next order placed on hold based on their specified credit parameters.

The same process of checking total open orders plus outstanding receivables is re-executed after the entry of each successive order line item as well.  So, the customer may not have been on credit hold at the start of the order entry process and may still have been fine through the first fifty line items of the order only to fail the credit check on the fifty-first line item.  Once an order goes on credit hold, an alert is sent to the appropriate credit manager to review the order and determine what needs to be done to be able to remove that order from credit hold.

From a collections management perspective, Enterprise 21 provides the functionality to monitor and manage the accounts receivable collections process.  Every night, the system evaluates outstanding receivables by customer to see what items have aged to past due plus a grace period (where you define what the grace period is, say 15 days), and the system automatically generates a series of collection calls to be made by the appropriate collections resource.  One can enter notes associated with the call and schedule a follow up collection call for that item based on the discussion with the customer’s accounts payable contact.  Should payment be received for that item prior to the next scheduled call, that item would automatically be removed from the collection call log so the person making the collection calls would not have to do so manually.

Through the combination of decision support dashboards to alert executives and management to trends in overall and late accounts receivable, visibility to overall accounts receivable in aggregate and by aging bucket by customer, and strong credit and collections management functionality, wholesale distributors and manufacturers using TGI’s Enterprise 21 ERP software have the tools necessary to manage customer credit and company cash flow effectively.


Using Enterprise 21 ERP’s Integrated Workbenches for USDOT Audits

Monday, April 5th, 2010 by Alex Smith

TGI’s Enterprise 21 ERP software features a built-in Workbench Designer that allows end users to design their own inquiry screens, graphical reports, and productivity gauges without any programming knowledge and without any modification to the application’s source code. These screens can be added to the Enterprise 21 menu structure and shared with other users throughout the organization with appropriate security privileges. Given the fact that virtually any data field in Enterprise 21 can be added to a workbench, the Workbench Designer has literally hundreds of applications for use in sales, marketing, customer service, manufacturing, shipping, receiving, finance and accounting, warehousing, and procurement.

In a recent conversation with a seafood distributor looking to migrate from their existing legacy system to a fully-integrated food distribution software system, the company’s GM informed me that they are subject to U.S. Department of Transportation (USDOT) audits. The GM told me that each time they are audited by the USDOT, she has to compile data from a variety of systems into a consolidated Excel spreadsheet. From start to finish, her process of retrieving and consolidating the data the USDOT wanted to see would last some two to three weeks, as she had to take the time to find the data in their existing system and a series of unorganized Excel documents. I then asked her what specific information the USDOT auditors wanted to see in her reports. According to the GM, the USDOT wanted to be able to see the country of origin of their products, when they received the product, what entity specifically supplied the product(s), the lot numbers assigned to the products upon their receipt, when the products were shipped to the distributor’s customers, the customers who were shipped the product, the method of shipment that was used for each customer order, and the freight carrier that was used for each customer order over a specific range of dates. She then asked, “Is this something Enterprise 21 can do?” My response – “Let’s build a workbench!”

By building a workbench, the seafood distributor can retrieve the data required by USDOT auditors with relative ease and efficiency. The GM’s formerly tedious process of retrieving information for USDOT audits would be reduced from two to three weeks to a matter of minutes. Furthermore, the GM would be able to export the data retrieved in her workbench directly to an Excel spreadsheet to then pass along to the auditors in their preferred data format.

While using Enterprise 21’s Workbench Designer for USDOT audits is just one example, workbenches have literally hundreds (if not thousands) of applicable uses for system users in any department of an organization.