Integrated DNA Technologies (IDT) is a leader in life sciences manufacturing and developing products for the research and diagnostic market. It serves the areas of academic research, biotechnology, clinical diagnostics and pharmaceutical development. IDT synthesizes and ships an average of 36,000 custom products per day and serves more than 86,000 customers worldwide.

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With the challenges of double-digit growth; expanding into several new product markets and fulfilling FDA traceability requirements, IDT knew it needed a new business system.  Ultimately IDT selected Microsoft Dynamics AX ERP 2012 and implementation partner Edgewater Fullscope.

According to Aaron Warner, CIO, “From an integration perspective, IDT has easily combined Dynamics AX ERP with existing custom software used in our complex manufacturing environment. The consistency of interface design and familiarity of other Microsoft products greatly simplified the training requirements. Ultimately, we found the total cost of ownership to be lower than our projections.”

Watch this short video and learn more …

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Growth and profitability — the ultimate combination of manufacturing goals. What will the second half of 2013 hold for discrete manufacturers? Just how big of a part can technology play?

Working with LNS Research and Microsoft Corporation, Fullscope is pleased to sponsor this informative webcast, one designed to highlight global manufacturing trends; how these trends can impact the US manufacturing sector; and the role technology can play in returning to growth mode sooner versus later.

Speakers for this event include: Matthew Littlefield, LNS Research, President and Principal Analyst; Melissa Cook, Microsoft, Senior Director and Global Manufacturing Industries Lead for Microsoft Dynamics; and Gil Garcia, Microsoft, Director Manufacturing Industries US Dynamics.

Planned topics:

•    What current global manufacturing trends indicate about the future of US manufacturing

•    How social media and mobile technologies influence demand and impact manufacturing production

•    Why manufacturers must focus on growth versus cost reductions, and ideas to get started using technology

•    How agility, innovation and empowerment of employees are the most important change agents within a manufacturing enterprise today

•    Why end-to-end process orchestration is key for achieving operational excellence efficiency

•    How discrete manufacturers can turn big data to actionable intelligence for improved growth

•   And much more …

For more information, speaker bios and to register, visit our website now

The benefits from ERP do not come from simply having the software; they result from being able to leverage its integrated capabilities to deliver better information to key decision makers. This leads to improved decisions, effective execution of business strategy, and better-served, more satisfied customers.5

Below are four companies who have learned to leverage their ERP data, and in some cases CRM, to their advantage.

Reily Foods Company

New Orleans, La.-based Reily Foods Company is a 110-year-old food and beverage manufacturer. The company has manufacturing facilities in New Orleans and Knoxville, Tenn. It is the second-largest manufacturer of iced tea in the country with its Luzianne brand, and makes other consumables such as mayonnaise and coffee.

“When we decided to get in with an ERP system, we hired a third-party consultant to review all our business processes and technology,” says Chris Foucheaux, director of business analytics and development at Reily Foods. A key metric that showed up as needed in all departments was timeliness of data. That was a significant challenge, because without the proper data, they couldn’t make appropriate decisions. “So when we looked at an ERP solution, that was the overarching goal for us: to get timeliness of data across the organization for one true picture,” says Foucheaux.

The company also felt the need to implement newer technology, ultimately choosing Microsoft Dynamics AX. With the timely ERP data that the solution delivered, Reily improved inventory turns and the management of its inventory. Further, they were able to better supply customers and support them with the proper service levels.

Reily strategizes around five key initiatives on an annual basis. Two of these are improving the processes and technologies the company has in place, and food safety and sustainability, which is increasingly important as markets expand and global certifications are required. “Part of the rationale for the initiatives is to assure we can pull data from our systems for informed decision making,” says Foucheaux. “Dynamics AX has done a very good job of this.”

One of the goals that Reily is striving for with their process technology initiative is to be predictive with their business. “We need to make accurate forecasts, understand them, and be able to produce to meet them,” he says. “When key fires strike up and we’re reactive, we’re not as effective and efficient as we could be.”

The British Retail Consortium (BRC) certification has become essential in the food and beverage industry, and Reily leverages its ERP data to have full traceability of its product across the supply chain. A case in point occurred with the company’s last BRC re-certification, an annual requirement. “A mock recall is one of the requirements of certification,” he explains. “With our old systems, both IT and the warehouse would have been involved to produce this report—a time-consuming effort. With Dynamics AX, we created the report in less than an hour, without requiring IT support.”

When first implementing the ERP solution, Reily was able to continue to ship and receive on time, as well as execute billing without disruption. “The process turned out to be smooth and anti-climatic, and that was very enjoyable, indeed,” concludes Foucheaux.

Heritage Bag Company

Dallas, Texas-based Heritage Bag Company, the nation’s largest producer of industrial trash bags, has six manufacturing facilities across the United States and produces 350 million pounds of product annually. Heritage implemented Microsoft Dynamics AX as its ERP solution in 2006; according to Sheffield, not only Heritage, but also its customers have benefited from the company’s improved ability to leverage its ERP data. “We know our customers better now, so we can service them better,” he says. “We often are able to tell them about sales trends in advance. That information alone, really that data flow, has been the selling point of our customer service. It’s pretty interesting when we can go into a customer and tell them more about their business than they know themselves.”

For Heritage, the visibility provided by ERP data impacts virtually every aspect of the business. “We’re able to do more with less,” explains Sheffield. “We’re much more efficient, and it all goes back to that data stream. Besides AX, we can also serve up that stream through our whole Microsoft platform—whether Excel, SharePoint, Reporting Services, and so on—to get that information to the appropriate user at the appropriate time in the appropriate way for maximum benefit.”

Chobani, Inc.

New Berlin, N.Y.-based Chobani, Inc., is a manufacturer of Greek yogurt, the top-selling brand in the country. Since its inception in 2005, the company has grown from five employees to almost 2,000 strong. It started out with one truck of milk a day and now uses over 4 million pounds daily. Today Chobani products are available nationwide as well as in Australia, Canada, and the UK.

“Our customers benefit from how we use ERP data because it allows us to take raw materials in, right down to the finished good. But also because it helps us enhance the whole process,” says Maureen Hurley, vice president of IT at Chobani. “Our slogan is, ‘nothing but good.’ Our use of ERP allows us to deliver that ‘nothing but good’ quality through our processing facilities, through the distribution channel, and right to the shelf.”

The business challenge when Chobani was a start-up was to move from manual, paper processes to automated ones. “As we grew, we knew we needed a more robust ERP system for inventory control, supply chain management, warehouse management—all the way through our operations,” says Hurley. Chobani’s selection of Microsoft Dynamics AX was influenced by the familiarity of its personnel with other Microsoft technologies (e.g., Excel, Outlook). “Our users picked up the interface really quickly,” notes Hurley. This made for easy handling and understanding of ERP data, which facilitated the implementation of solutions as Chobani continued to grow at a rapid pace. “Change in the manufacturing facility was challenging enough,” says Hurley. “That our ERP information came in a format we were familiar with was an advantage.”

The benefits the company has experienced since coming online with the Dynamics AX ERP solution include:

  • Lower costs of products and processes
  • Better control of inventory
  • More efficient financials, including issue of payments and receipts
  • Faster time-to-market

“We’re big process people,” says Hurley. “We knew that we didn’t do anything differently than most ERP users from a general ledger, accounts receivable, accounts payable and supply chain perspective. What we did differently was process; so we engaged Fullscope to work with us in implementation because they wrote the processing module that was purchased by Microsoft. They had the most knowledge to help us integrate our core competencies with the software solution.”

A further advantage Hurley cites is the tight integration of Microsoft Dynamics AX and Microsoft Dynamics CRM. “The integration was already there, which meant we could get to market very fast while implementing the modules at our own pace,” she notes. “It was a logical choice to go this route.” It was cost effective—the total cost of ownership was compelling when compared to other solutions—and the power of the ERP/CRM data to efficiently run Chobani’s growing business was essential. “In the end, it was basically a no-brainer for us,” Hurley concludes.

Eureka Lighting

Montreal, Quebec-based Eureka Lighting is a North American leader in decorative lighting solutions manufacturing. The company provides a wide range of flexible products designed to meet the needs of architects and designers and to enhance contemporary working and living environments.

Founded in 1987, the company grew very rapidly, and a number of issues developed: inventory proved increasingly difficult to track effectively, and order fulfillment and customer satisfaction rates fell short of management expectations.

With millions of product possibilities, Eureka’s dependence on precise inventory figures is impossible to overstate. The company relied on staff to manually track inventory, patrolling the warehouse with pen and paper in search of needed parts. This made it difficult to estimate delivery times. Orders took longer to fulfill, and customer delivery times became less predictable. Business reporting was also nonexistent. Plant floor staff, managers, and partners lacked a clear, centralized view of the number and status of orders, and the means to easily adjust them on the fly.

To address these challenges, the company implemented an ERP solution (Microsoft Dynamics AX), and then leveraged ERP data to reduce inventory, cut delivery times, and dramatically improve customer satisfaction rates. The result: greater operational efficiency and a better bottom line. Now ERP data provides an exact picture of stock positions to help sales staff make correct delivery assessments for customers, give plant floor staff insight into what is needed, and smooth the processes of accounts payable and receivable.

“Using the data from Microsoft Dynamics AX, we can leverage the market experience we’ve accumulated to be more flexible and responsive,” says Patrick Foley, president of Eureka. The resulting business improvements include:

  • Lower inventory load and reduced customer service time
  • Real-time visibility of stock and order information
  • Better customer access to Eureka’s online quote configurator, driving up satisfaction rates
  • Reduced operating costs:
    • Dedicated staff for inventory cycle count, procurement, and distribution reduced by 50 percent; staff reallocated to more strategic areas.
    • Inventory costs reduced by $2M.
    • $800K in obsolete parts eliminated.
    • Administrative tasks reduced by 20 percent.
    • Faster turnaround times, extremely fast for a make-to-order business

RESOURCEFULNESS BY EXTENSION

It is ironic that many companies running ERP forget that the idea of resource is at the center of the application. Those who remember and therefore leverage ERP as a resource find themselves at a competitive advantage. “Intuition becomes increasingly valuable in the new information society precisely because there is so much data,” said the author and futurist John Nesbitt. Implicit in this idea is the fact that while data holds power for its users, the imagination and expertise of its users is what unleashes that power. This holds true for ERP data, and is one of the reasons that the ability to extend ERP by integrating other technologies with it is such a powerful tool: it provides more opportunities for individuals to leverage their own capabilities in using technology.

As the above cases show, Microsoft Dynamics AX is particularly well suited to unleash the power of data because of the ability to extend its value through other Microsoft technologies. This integration provides people with the information and tools necessary to work more productively, communicate more effectively, and find, share and make greater sense and use of information.

In the end, ERP (including its data) is an enabler of better business processes; it helps us move towards excellence by providing the basis for greater understanding. Of course, that understanding must involve the users’ intuition, leadership, intelligence, and culture to attain change and positive growth. Then our resources can attain their maximum value, including our Enterprise Resource Planning systems.

Download the Entire White Paper Now:  http://bit.ly/fs_erpdata

NOTES

5 Cutley, Sean, “Ensuring the ROI from ERP Has a Bigger ‘R’ than ‘I,’” The European Business Review, October 2012.

The fascination with data continues to proliferate, just like data itself. “Big data” used to be considered a collection of data sets so large and complex that it was difficult to process using on-hand database management tools or traditional data processing . Now it is seen less as something to grapple with and more as a source of tremendous power that can maximize value, identify new revenue streams, and ensure advantages in an increasingly competitive global marketplace. While this may be true, and the growing concern with big data understandable, there’s a more manageable and often underutilized source right in the heart of most enterprises: ERP data.

According to Aberdeen, Enterprise Resource Planning (ERP) solutions are an integrated suite of modules that form the operational and transactional system of record upon which any business is based. “As such, ERP systems contain large amounts of data that can be used to gain visibility into business operations and underpin informed management decisions,” says the introduction to a recent study by the analyst. “Often there is difficulty in finding the data needed and analyzing it to gain insight. Data may be siloed or inaccessible to business users, preventing these organizations from gaining the full return on investment (ROI) from their ERP implementations.”1

One of the major reasons many ERP implementations have not lived up to expectations is that they were employed as a software project per se, rather than as a business improvement tool.2 Failure to fully understand the value of ERP data may be a part of this misapplication. “Information is the lifeblood of the organization, and the primary goal of ERP is to provide decision makers with the information that they need in order to make properly informed decisions; to provide a solid foundation of truth,” notes Sean Culey, a member of the Supply Chain Council’s European Leadership Team. “Accurate and timely data can enable rapid, incisive decision making, whilst poor and inaccurate data slows down everything, [creating] excess management, duplication, and indecision. Many businesses use tools like ERP as transactional recording devices to capture what they have done, rather than pour their intelligence into the system so it can plan what they should do.”3 As a result, many users say that ERP presents information they disagree with, constraining the flexibility of their supply chains.

In contrast, those who are leveraging their ERP data, integrating it with other enterprise systems, and delivering it in a timely and understandable manner to decision makers are seeing significant benefits in operations. “It comes down to getting the data stream right, and that data stream comes from our ERP, CRM, and other enterprise systems,” says Doug Sheffield, vice president of information technology for Dallas, Texas-based Heritage Bag Company, the largest manufacturer of industrial trash bags in the United States. “We’re able to take that data stream, whether it’s customer, sales, production or manufacturing data, and make it available throughout our organization. By consolidating the data, we get a holistic view of where we are as a company; then we can see the different areas in which we can work, improve, and become more efficient.”

According to Sheffield, ERP provides a single trustworthy data source. Without that, companies struggle to:

  • Close out the month properly.
  • Meet compliance requirements.
  • Plan production accurately and effectively.
  • Understand what has shipped versus what has been billed.
  • Communicate across multiple facilities, be they plants or corporate offices.
  • Establish communications for visibility into all areas of the business from all areas of the business.
  • Make well-informed decisions.

To facilitate these essential activities, ERP solutions have evolved different ways of delivering data. Analysts note ERP’s expanding footprint, indicating its value will grow as long it continues to evolve to meet customer needs, and that those customers realize the value of this data.  These goals can get lost when these users become fixated on what they run day-to-day.4

Up Next: ERP Data Part 2:  Four Manufacturers Who Get It:   Or Download the Entire White Paper Now:  http://bit.ly/fs_erpdata

  1. “ERP Plus BI: Maximizing the Return on Your ERP Investment,” Aberdeen, 2012.
  2. Cutley, Sean, “Ensuring the ROI from ERP Has a Bigger ‘R’ than ‘I,’” The European Business Review, October 2012.
  3. Ibid.
  4. Goulart, Karen, “Other IT Systems May Get the Buzz, But the Value of ERP Remains,” TechTarget.com,  February 29, 2012.

When American industrial trash bag maker Heritage realized that its legacy systems couldn’t support its growth plans, including its line of commercial-grade compostable bags, the company turned to Microsoft Dynamics AX ERP. As a result of Heritage’s smooth Microsoft Dynamics AX and CRM implementation, the software platform has helped Heritage to reduce inventory, serve more customers, grow with fewer resources and consolidate data.

See the full video:  Heritage Bag: Making Things Possible with Dynamics AX

It’s been a mixed year for chemical manufacturers.  While end-use markets have recovered to their pre-recession levels, growth beyond that level has been slow.  For many North American firms, exports have been especially weak as markets in Europe have all but disappeared.  There are bright spots, such as the surge in demand for ethylene-based products, driven by burgeoning natural gas capacity.  Still, it’s been a year of eking out profitability wherever it can be found.  One of the strategies many chemical manufacturers are using to improve margins is a renewed focus on business basics, the industry best practices that separate market leaders from the rest of the pack.

Common strategies in emphasizing best practices include process intensification (the merging of two or more production processes), a search for greater supply chain efficiency and a renewed drive to pare overhead even more.  While every business process can yield some additional waste and performance improvement, producers often overlook the benefits to be gained from more effective vendor management and purchasing.

Procurement leaders differ on some of the details of what constitutes purchasing excellence, but several themes recur in almost every vendor management or purchasing excellence initiative.  We’ll discuss some of these initiatives shortly.  The common foundations of purchasing excellence initiatives are better communication, more accurate data at all levels and a focus on enforceable, repeatable processes.  Finding a way to achieve these objectives can be a challenge.  Microsoft Dynamics AX ERP for chemical manufacturers provides these foundations, as well as other tools required to implement best-in-class processes that can give you the competitive advantage you need to sustain and grow margins in an already competitive business.

First we’ll discuss some of the tactics you can use to improve purchasing performance and contribute to stronger margins.  Then we’ll look at how Microsoft Dynamics AX ERP can help you, as a chemical manufacturer, to effectively implement some or all of these approaches in your company.  Read the rest of this entry »

Businesses of all sizes, including more than 90 percent of Fortune 100 companies, rely on Enterprise Resource Planning (ERP) systems. ERP is an integrated computer-based system used to manage internal and external resources, including tangible assets, financial resources, materials, and human resources. Its purpose is to facilitate the flow of information between all business functions inside the boundaries of the organization and manage the connection to the supply chain. Built on a centralized database and normally using a common computing platform, ERP systems consolidate all business operations into a uniform and enterprise-wide system environment.

We are now more than 20 years into a business world driven, in good part, by ERP systems and the efficacies they enable. (The term “Enterprise Resource Planning” was first employed by the research and analysis firm Gartner Group in 1990 as an extension of MRP—first, Material Requirements Planning;  later, Manufacturing Resource Planning—and Computer Integrated Manufacturing. While not supplanting these terms, ERP has come to represent a larger whole.)

A recent survey of CIOs indicated that ERPs were “essential to the core of their businesses, and that they could not live without them.” They also acknowledge that many of these systems are out of date technologically, or, in the case of those that have newer systems, troublingly expensive with customization and maintenance costs. It is time to consider the questions: is your business running as well as it should be? If not, why not? Your current ERP system may be the dynamo it was intended to be, but if it has become outdated or outrageously expensive to operate—a dinosaur or a devil in the making—chances are it is doing more harm than good in today’s increasingly contested global competition. Regardless of your business or industry, the time has come to examine your ERP system dispassionately.

• Should you continue with your current system?
• Is it time to upgrade?
• Is it time to change?

These are not easy questions to answer. In part one of a multi-part post, this article is designed to give you an overview of what needs to be considered as you go through this interrogative—and potentially invigorating—process.

Why Consider Change?

To survive and thrive in today’s marketplace, companies must improve and streamline their operations and business processes to increase productivity, drive down costs, and foster innovation. These were principal motivating factors in the original implementation of ERP systems. Even as those systems have changed and evolved, ERP’s importance to business vitality has increased as competition has expanded. In a period of upheaval, such as the one we are living in, change is the norm and should not be postponed but rather embraced.

While ERP systems were designed to improve business processes, they sometimes impose bad ones. As you gauge the effectiveness of your current ERP system, do so in light of your core business processes. Is the system facilitating efficiencies and greater productivity, or is it forcing action based on its own structure?

Initial ERP systems were often inflexible, forcing organizations to bend their business processes to the needs of the software rather than the needs of the business. Or the software required significant, expensive, and time-consuming customization to gain a little flexibility. When business processes evolve and software remains static, a chasm emerges between the original implementation and the changing requirements of the business. This may continue over time to the point where the ERP system becomes an impediment rather than an enabler—in other words, dysfunctional.

Many companies with older ERP systems have augmented them with other software to gain functionality that was lacking in the initial ERP System implementation but subsequently deemed necessary. The data from these newer systems must integrate into the existing ERP System, and in numerous instances this has proved costly, problematic, or both.

Integrating data to ERP systems from these reactionary systems can be challenging, as even before their addition, data migration to ERP was often given inadequate atttention due to its typical position in the production phase of implementations.

As ERP systems evolved, the problem of integration has been addressed by the expansion of functionality. The idea is to replace standalone systems—and eliminate siloes of information—with the capabilities inherent in the new ERP System. Independent software vendors have also developed industry-specific modules that are tightly integrated to the core ERP application. As companies have persisted in their need for third-party applications outside of core ERP, ERP vendors have developed application interface tools (APIs) designed to ease integration challenges.

Access to both resources and support personnel is also an issue that demands consideration. As you assess the technology of your ERP system, consider where the vendor will be ten years from now, and what kind of support will be available at that time. Ongoing support must be a given if you are to stay with your current ERP system technology, just as your own organization’s ability to change must be considered if new technology is to be implemented.

Remember that when you purchase an ERP system, that purchase is not static but dynamic: the product, the vendor, and their relationship with your organization must develop and support your goals through the years to come.

Your ERP system’s ability to provide the reports and information is another important aspect to consider in evaluating current system status:

  • Are you getting the reports and information you need to run your business effectively?
  • Can users run their own reports queries or do they need to turn to IT for support?
  • If so, what are those costs in terms of time and labor to develop these custom reports and inquires?
  • How easily can you access reports and inquires?
  • How easily can you export them to desktop applications like MS Excel?
  • Is the information you’re getting real-time, actionable, and easy to understand?

Often a company will experience pain, or even failure, because during its planning, reporting tools and inquiries were not considered as important as other system components.

Many companies have no idea what the total costs are to operate their ERP system because only a handful of the costs are quantifiable. Hard costs (e.g., license fees, maintenance fees) can be easily expressed and are readily available, but soft costs are more difficult to grasp, and can be very costly in terms of labor, productivity, and time. In fact, if you were to just look at hard costs, a new ERP system will almost always appear to be a more expensive option than staying with the current one. But when total cost of ownership is evaluated, accounting for both hard and soft costs, a new system may be warranted because of the productivity gains, time savings, and increased revenue opportunities that a new system brings.

Weighing the costs and benefits of retaining an existing ERP system against the costs and benefits of changing to a new one is something that companies will do sooner or later. If your current business environment has you thinking sooner is the better of these options, then there is a methodology to follow that will inform the decision you must make—a decision that will have a shaping, and perhaps decisive, influence on the future course of your business.

Next Time/Part 2: The Process of Examination:  Detailed Steps To Determine if You Should Keep Or Replace Your Existing Solution