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The Migration from QuickBooks to ERP Software: Problems, Solutions, and Common Questions

April 20th, 2009 by admin

Many small business manufacturing and distribution companies run some combination of QuickBooks for managing accounting transactions and Excel spreadsheets to maintain inventory levels and record production scheduling. For these companies, the mere thought of migrating from these widely used and recognized tools can be intimidating for even the most technologically savvy small business owners. That being said, with proper data migration and training, small business executives and employees can learn new, more efficient practices in a timely manner to help run a small business more profitably.

One common issue software users have as an impetus for migrating from QuickBooks to more sophisticated software solutions is changing the business’ costing methodology. QuickBooks, while highly intuitive, only allows for one costing methodology. Enterprise 21, however, offers more flexible costing methods to best suit each small business’ specific needs. Enterprise 21 small business ERP software allows for average, standard, LIFO, and FIFO costing as granular as on a product-by-product basis.

A relevant example of this is when a small business within the food and beverage industry migrates from their existing entry-level software package. Many start-up or small food processors do not have the ability to use FIFO-based costing, yet they require it in order to meet their accounting and costing needs more adequately.

In addition, small business owners are frequently concerned with moving their existing data maintained in QuickBooks, Excel spreadsheets, or other small business accounting software packages into more advanced software solutions. Though small businesses have fewer employees than larger organizations, that does not exclude them from often times having hundreds or even thousands of products, ingredients, parts, vendors, and customers.

The thought of spending employee time and resources to enter each individual record manually with this volume of data is simply not practical (or affordable) for a small business. Fortunately, TGI developers have standard routines and tools in place to load existing data contained in QuickBooks, Excel spreadsheets, and other small business software packages directly into the proper fields within Enterprise 21 with little to no manual data entry. The data is then rigorously tested (in a test environment) to check for accuracy and consistency, and to make sure no errors have occurred in the migration process. By migrating existing data rather than manually entering it into the new system results in substantial time and cost savings to the small business.

Lastly, and perhaps most importantly, small business owners question in what ways their day-to-day business operations must change in order to adopt a new, technologically- and functionally-sophisticated software package. To achieve a rational and sizable return on investment (ROI), both small business owners and employees must be flexible and open-minded in adopting new, more efficient business practices and processes with the implementation of a new software package. The goal in selecting a new manufacturing or distribution software package should be, ultimately, to enable daily business operations to run more effectively, efficiently, accurately, and profitably. A fully-integrated ERP software package can do this with ease.

A fully-integrated software package eliminates the need for data entry and transacting business in a multitude of software packages concurrently; every entry and transaction would be performed in only one software package, allowing for improved data accuracy and visibility. Initially, employees may struggle to grasp new methodologies because the way they perform their daily jobs and tasks could be radically different. They will, however, also be significantly better. The new manufacturing or distribution software system will offer process improvements and provide a structure for adopting best practices. With adequate training and practice, software users will adopt new, better business processes and practices that will ultimately result in better, more efficient operations and an increase in the productivity and bottom line for the entire organization, thus allowing for future and sustainable business growth.

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The Secret to Increasing Distribution Service Levels and Fill Rates

March 25th, 2009 by admin

A key element to the success of wholesale distributors is to simultaneously manage appropriate inventory levels while maintaining high levels of customer service and satisfaction. Depending on the reliability of the distributor’s supply base, performing these tasks effectively may seem virtually impossible. Achieving desired service and order fill rate goals is based on the successful implementation of an effective inventory replenishment program. While the concepts of inventory replenishment, service levels, and order points have been used for decades, the number of distribution companies who understand and utilize these concepts is significantly lower than one might imagine. The fact of the matter is that most distribution companies struggle with inventory optimization.

While there are complexities in the details, at an overall level, smart distribution companies are focused on delivering the highest possible service levels to their customers while minimizing on-hand inventory. For distributors, long-term profitability is contingent upon having the right products available to meet customer demand at the right time. If this concept is so elementary, why do so many companies struggle with establishing optimal inventory levels, and why do distributors struggle to have adequate product supply to fulfill customer orders?

The two-word answer to this conundrum is “service levels.” Excellence in distribution is synonymous with the ability to supply customers with a high service level that is both consistent and reliable.

What is a service level? Service level refers to an organization’s ability to enter and ship all of the items requested on a given sales order to meet the customer’s desired receipt dates. This means there are no inventory shortages or backorders, and the order is filled within the customer’s requested delivery window.

In TGI’s Enterprise 21 ERP system, a service factor can be defined by item or SKU, which defines the desired line item fill rate for that given item. Service factors can be set on a global basis or can be defined uniquely by location or facility. For some fast-moving items, a service factor of 95 or 99 may be desired, while others may require much lower service levels of 50 or 60.

How does Enterprise 21 use service factors? Once a service factor is defined – by SKU – Enterprise 21 uses the service factor in its time-phased inventory replenishment process. In Enterprise 21, a service factor of 95 implies that 95% of the time a customer places an order for a given item, the item can be shipped out of inventory, while a service factor of 99 means this is to occur 99% of the time.

In Enterprise 21, the inventory replenishment process analyzes supply and demand to help distribution organizations improve order and line item fill rates and optimize their overall inventory management performance. The process considers a variety of criteria such as desired service level and safety stock, minimum and maximum inventory levels on a product-by-product basis, on-hand inventory, forecasts and current customer demand, supplier lead times, minimum order requirements, and order multiples. In organizations with multiple facilities, Enterprise 21 can review requirements for an individual warehouse or distribution center and for the organization as a whole. Once the Enterprise 21 system’s inventory replenishment process calculates the necessary recommended replenishment quantity, the application generates online requisitions for review and conversion into purchase orders and inventory transfer requests.

What further sets Enterprise 21 apart is the continuation of this process to gather transactional data as things occur and to report on that information for analysis purposes. An integral part of Enterprise 21’s distribution software functionality is the ability to monitor service levels automatically and produce suggestions for necessary changes to existing replenishment rules. By interactively collecting and analyzing information such as order and line-item fill rates, Enterprise 21 produces reports and management alerts to notify the organization of any anomalies compared with existing service level metrics.

Successful distributors know the key to ongoing and improved profitability is due in large part to managing the balance between customer service and inventory levels. Enterprise 21’s advanced inventory replenishment capabilities, including the use of service factors, are just one of the reasons leading distributors adopt Enterprise 21 for its complete distribution software capabilities.

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Establishing the Complete Chain of Custody of Your Products through Lot Tracking

March 19th, 2009 by admin

One of the hottest topics in process manufacturing is lot traceability. The definition of lot traceability is the process of tracking given material lots throughout the enterprise and beyond. Lot traceability includes tracking lots forward from ingredients through manufacturing processes into finished goods, which are ultimately shipped to end customers. This also includes tracking lots backwards from finished goods back into the manufacturing processes and then back to the ingredients consumed in the production processes.

In ERP systems with strong process manufacturing support like Enterprise 21, companies who have a need to track lots should be able to do so easily and in an automated manner. This is a key element for establishing good system and procedural controls within one’s business, and should the need arise for a product recall, make the isolation process easy and straightforward while minimizing the amount of product necessary for inclusion in the recall.

Most companies without a modern ERP system that includes sophisticated lot tracking software functionality are managing their lot data in a suboptimal manner. Many of these companies may simply be recording lots on hard copy logs, using a series of spreadsheets to key in this data, or a combination of these methods. Not only does this process create a large amount of manual efforts, it leaves operations vulnerable to a significant amount of data entry errors and potential compliance issues.

What a good ERP software package like Enterprise 21 offers is two-fold. First, one can establish and record lot properties, which is a series of corresponding values for a given product’s physical characteristics. This practice is a key element in the quality control (QC) process. Second, one can record the complete chain of custody or pedigree of lots through the enterprise and beyond. Both of these steps are critical requirements for strong lot traceability and compliance.

Relative to system-enabled lot analysis for ingredients, when ingredients are received, the associated lots are recorded. Those received lots would typically be placed on QC hold and the inspectors alerted as to the need to inspect and analyze these lots. The inspectors would perform their analysis and record the values for the associated ingredient lot properties. Assuming the values observed and recorded were within the acceptable range for the various lot property characteristics, then the given lot of ingredients would be released to available inventory for consumption in manufacturing processes.

A similar process can be performed for system-enabled lot analysis for manufactured goods. When manufacturing occurs, the associated lots are recorded. The produced lots can likewise be placed on QC hold and the inspectors alerted to take action. Once the inspectors perform their analysis, the values of the produced goods’ lot properties would be recorded. Assuming all of the lot properties were within spec, the produced goods would be released to available inventory.

While there can be other complexities to one’s operations with packing and repacking of product into various containers with associated lots recorded, the lots shipped to a given customer would be recorded, thus providing complete visibility as to which finished goods lots were shipped to customers associated with given sales orders. This process establishes a complete chain of custody from ingredient lots received, which are consumed in manufacturing yielding manufactured lots, which are then shipped out to customers.

Once this data is recorded in the system, both forward and backward lot traceability can be performed. Forward lot traceability is the tracing of ingredients from suppliers through production processes out to customers in finished goods lots. Backward lot traceability is tracing finished goods lots back from customers into production to determine which other customers received product from those specific produced lots and back to ingredients received from suppliers, if necessary.

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Justifying a Software Selection Project in Our Current Economic State

February 19th, 2009 by admin

As 2009 arrives, companies of various sizes contemplate the year ahead and consider their options for remaining both profitable and viable in a world of relative economic uncertainty. As such, business leaders are adjusting to the new economic challenges and market conditions. While all of this uncertainty will eventually stabilize, organizations must question what is next for them as a company and for their upcoming projects and applicable expenditures.

As has occurred throughout history, human nature evolves and the strong survive. Businesses are no different. Virtually every industry or sector has evolved in some manner over the last few months. The world of information technology has experienced its own transformation. Technology-based purchases are still occurring and companies are initiating new projects. The difference is the nature of the project and the decision making process surrounding the acquisition of the products or services purchased.

ERP software is, without question, a major endeavor for any organization. While a significant amount of work goes into both the selection and implementation of a new business software system, it does so with the ultimate promise of providing significant tangible and intangible benefits to the organization. ERP software can help transform an organization by eliminating internal weaknesses and by producing a roadmap for leaner, more efficient, and more profitable operations. It can be the saving grace for a struggling company, and it can help provide a solid foundation for a profitable tomorrow.

To achieve the project success and the promises ERP software offers, the ERP selection process needs to be tightly managed and executed in a very systematic manner. Now more than ever, the purchase needs to be based on known pain points or organizational weaknesses. The purchase needs to help solidify the organization’s future. The resulting purchase needs to allow for tangible benefits and a measurable return on investment. The purchase needs to be justifiable for both the selection team and the organization’s leadership.

While this may seem like a pipe dream to some, concrete return on investment is completely feasible when the right ERP software is purchased and implemented. From inventory reductions and improved order fill rates to more efficient back-office processing, ERP software can significantly improve an organization’s bottom line and overall profitability. ERP software can provide a genuine return on investment through lower inventory carrying costs, reductions in overtime hours, and more efficient production lines.

While these are only a few areas of ROI, they are realistic expectations when implementing a solid ERP solution. These benefits can provide a relatively fast payback, and they represent the means to justify the purchase that brings along with it a number of additional intangible benefits such as visibility to data, improved customer service, and an increase in overall customer satisfaction. Intangible benefits aside, in uncertain times, any major expenditure needs to be backed by measurable results.

If 2009 brings the promise of change, an ERP software purchase can help provide the catalyst for that transformation. It can provide the backbone for an organization’s future by offering a path to a more efficient operational flow and a more productive workforce in the months and years to come. It can be a justifiable purchase with solid return and measurable payback.

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Overcoming the Biggest Obstacle to Successful Enterprise Software Implementation

February 19th, 2009 by admin

While most discussions about successful implementation of enterprise software focus on the critical tasks to be completed – training, testing, and data migration – the biggest obstacle to successful enterprise software implementation is getting key resources engaged and keeping them focused and energized enough to push the project across the finish line.

It is very common for there to be a lot of energy and enthusiasm from project team members when a new implementation project kicks off. However, as things continue to move forward – generally somewhere in the 90-120 day range of the project – things can begin to bog down. People have been working on the project for a sufficient period of time so the energy and excitement that they felt day 1 when the project kickoff occurred has worn off. And, by this point in the project, they have come to the realization that there is still a lot of hard work ahead of them to see the project through to success.

Some people continue to focus and grind out the days keeping an eye on the goal. Others become distracted and gravitate back to old habits and tasks that may seem urgent at the moment but will not be beneficial to helping get their company to the new software platform. Without an outside impetus to continue to move the team forward, things will stagnate. Then, there will be an epiphany some 30-60 days before a desired production go-live date when it is realized that 80% of the project time line is completed, and 50% of the work tasks remain. Too many times, the project team has become so blinded that they don’t even realize they have this amount of work to complete for a successful go-live.

So, what’s the remedy to this situation – to keep things from bogging down to the point where project success is in jeopardy? The answer is two fold.

First, it is imperative to keep the finish line in mind in some concrete manner. Discussing the objectives simply doesn’t make things vivid enough to keep the organization focused. Rather, making the objectives visual in some manner – with pictures and images that depict where the business will be after the project go-live date – will keep the goals of the organization much more alive and real to project team members.

The second, in addition to having the project manager monitor tasks and project progress, one can establish and monitor a project morale barometer – some means to measure how resources are feeling about the project and how engaged they are in completing their assigned tasks in a timely and high-quality manner. When things start to slip, there needs to be an action taken that intentionally breathes new life back into the project team member(s) who are struggling.

The sooner it is determined that the project morale barometer is starting to slip, the better the odds that taking appropriate actions will resolve matters and keep the project on track. Making minor course corrections during the project will keep the team moving toward the same goal. Left unchecked, even a minor deviation will cause the team to be miles off target several months down the road when it had intended to be ready to go-live with the software.

In conclusion, if project focus and morale are properly maintained throughout the software implementation process, then the customer should expect to have a highly successful go-live experience.

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Learning To Develop Your Own Reports In Enterprise 21

February 19th, 2009 by admin

After the dust has settled from a software implementation and system users have become fully submersed in the various functions they perform on a day-to-day basis, one of the key areas of importance post go-live is to learn to develop personalized reports.

In Enterprise 21, reports can be generated in a variety of ways with each possessing varying degrees of difficulty and flexibility for customization. If you are only looking to export data out of the system and into a report, with appropriate security privileges you can simply click an icon that allows you to export the raw data that you are viewing directly into an Excel spreadsheet. The data you see in this report, however, is limited to the fields and data contained on the specific screen from which the data was exported.

The second way to generate your own reports in Enterprise 21 is to use the fully integrated business intelligence software. The business intelligence module is designed for users to view and track data residing primarily in Enterprise 21’s associated data warehouse in a variety of formats, including pie charts, bar charts, area charts, simple spreadsheets, a combination of graphs and spreadsheets, etc. With this reporting and analytical tool, users can “drill down” on information from high-level views to more detailed views, such as viewing sales over time to then viewing sales over time by customer or product.

A third way to generate reports in Enterprise 21 is through workbenches. Workbenches enable users to create and design their own inquiry screens without touching application source code. Users can choose any of a variety of fields to place on a given screen and then use these fields to generate data that can be put into reports in graphical or spreadsheet format. The benefit of using Enterprise 21’s workbenches to generate your own reports is two fold; first, the workbenches can be created on a user-by-user basis with no two workbenches being exactly the same, without touching application source code. Secondly, such a tool further alleviates users’ dependence on their software provider. The workbenches offer Enterprise 21 users a degree of independence on the part of the user after what was largely a dependent process in the software implementation project.

Finally, users can also be trained to develop reports using Crystal Reports. Depending on the complexities of the information contained in the report, this may or may not be an option for users looking to create reports without the help of a technical resource.

Having users within your organization learn to develop reports on their own is an essential part of the implementation process; remember, the implementation process does not end at go-live! In a world with routine (and lately, dramatic) price and market fluctuations, creating reports to track daily and weekly fluctuations and trends is vital to ongoing business success, planning, and forecasting.

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