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.

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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.

Manufacturers, by the pure nature of what they do, require very specific software applications to run their businesses.  When you drop to an industry level, the special requirements lists for both get even longer.

That’s why Fullscope has announced a new series of solutions designed to extend functionality in Microsoft Dynamics AX enterprise resource planning (ERP) and Microsoft Dynamics CRM to help solve specific manufacturing challenges.

Unveiled at Convergence 2013 in New Orleans, Fullscope EDGE Industry Solutions for Microsoft Dynamics AX will include software for chemical, life sciences, pharmaceutical, food and consumer product goods (CPG) manufacturers that build on and extend the industry functionality available in the core Microsoft system. The first solution, EDGE for Life Sciences & Pharma, will address core issues that life sciences and pharmaceutical manufacturers face, including Corrective Actions & Preventive Actions (CAPA); electronic device history records; enhanced eSignatures; flexible sampling plans; approved customer lists; vendor scorecards and validation requirements. Fullscope will continue to invest in and release new solutions for food, chemical, CPG and industrial manufacturers. For additional information, see http://www.fullscope.com/phpfn/View.php?ArticleID=349

The Fullscope EDGE Solutions for Microsoft Dynamics CRM help CPG and industrial manufacturers with complex sales channels (including inside sales, field sales, direct sales, reseller networks and partner sales) improve communication gaps and have better visibility to data. The solutions are EDGE for Partner Relationship Management (PRM); EDGE for Sales Force Automation (SFA); EDGE for Customer Service Assistance (CSA) and EDGE for Trade Promotion Management (TPM). The Fullscope EDGE Solutions for CRM can be deployed in the Cloud, on premise and, for select functionality, on mobile devices. For additional information, see http://www.fullscope.com/phpfn/View.php?ArticleID=347

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

http://bit.ly/reilyaxvideo

Fullscope customer/food and beverage manufacturer Reily Foods Company uses Microsoft Dynamics AX ERP software, for usability, flexibility and support for unique food manufacturing needs. With Microsoft Dynamics AX, Reily is able to have real-time access to data, plus the information it needs to support food safety and sustainability practices, including traceability for product recalls. Watch this short video and learn more …

When industrial equipment manufacturers evaluate ERP software, one of the key categories on the checklist is quality management. There seems to be a consensus that any Enterprise Resource Planning (ERP) system worth its salt ought to include the ability to plan and manage quality. While the quality management capabilities of Microsoft Dynamics AX compare favorably with those of competitive systems, taking a hard look at why quality really matters in Industrial Equipment Manufacturing demonstrates some of the major reasons why Dynamics AX is the ERP system of choice for mid-market IEM companies.

Quality is been a common theme in most manufacturing segments since the rise of Japanese automakers and the introduction of the Toyoda Production System in the 1980s. Japanese automakers dominated the American market first on price and then on the reliability of their cars. When Ford Motor Company declared “Quality is Job 1,” it reflected the realization of many American manufacturers that quality was mechanism that drove the Japanese competitive engine. Since that time the concept and the imperative of quality has evolved considerably. Whether it’s called Total Quality Management or Six Sigma or something else, the focus on quality has become ingrained in American manufacturing management doctrine and methodology. As a result, we include a quality management evaluation category on our ERP checklists and believe the ERP system we select will somehow help us do a better job of producing quality product.

Customer success stories demonstrate that IEM companies selecting Microsoft Dynamics AX often improve in managing quality and producing quality product. It’s possible to learn a great deal from the successes of others, but it’s also important to understand how to translate that learning into success for your company. As we said, taking a comprehensive look at why quality matters in IEM can help you evaluate how you can improve the quality performance of your company and understand why Microsoft Dynamics AX ERP software for industrial equipment manufacturing is a key tool in helping your achieve your quality goals.  Read the rest of this entry »

Fullsope’s new series of Process Accelerators makes it easy for manufacturers to employ potency pricing procedures.

With potency pricing, a manufacturer sets purchase pricing and inventory value based on the received material’s active concentration (i.e., potency) or some other quality-controlled values (fat content, protein content, etc). This is a key requirement for process industries where low margins require costing and margin analysis at the lot level. It’s required in industries such as dairy and feed which measure and pay based on butterfat content or protein content, and is standard business practice for pricing precious metals. This is equally applicable to any process industries company that manufactures or distributes high valued, active ingredient based products.

Common enterprise resource planning (ERP) solutions price materials according to linear pricing schedules, but in process industries, multiple factors come into play in determining compensation for a supplier. The Fullscope Process Accelerators:

  • Provide a flexible formula that allows companies to pay suppliers based on actual quality results for potency.
  • Assign actual inventory value for each inventory lot that is potency-controlled.
  • Help record more accurate margins based on the actual potent value of materials sold or consumed.

Using milk again as an example, a typical dairy producer will send a tanker with paperwork specifying that this tanker of milk has a certain stated butterfat and protein content. But the manufacturer, the buyer of the milk, wants to run their own tests because the agreement is that payment will be made based on the manufacturer’s quality analysis result. Or, payment could be based on the average of the milk vendor’s value and the manufacturer’s value: the buyer and supplier can meet halfway.

A typical ERP solution pricing scheme won’t address that scenario.

Fullscope Process Accelerators use an advanced pricing formula that gives the manufacturer the ability to define which characteristics are going to drive the price. It can be the concentration alone or multiple characteristics of an incoming shipment. The formula applies equally well to chemicals, food, or metals. The system will calculate a price and hence the inventory value based on those user‑defined characteristics.

A large part of our Process Accelerators’ elegance and utility comes from flexibility: even though the metals industry will use a different formula than those used by the dairy or chemical industries, each can build their own formulas easily.

Lot Genealogy and Traceability

Lot genealogy is the ability to automatically transfer properties of a raw material lot to a manufactured item’s lot. An effective lot genealogy system must transfer key lot characteristics. For example, a manufacturer may use a metal coil that has a certain alloy content and mechanical strength. If this coil is cut into a smaller one, those properties need to follow the smaller coil as well. Sometimes this is referred to as parent-child inheritance. A manufacturer wants the characteristics from the original coil to carry over into the product that ultimately contains the small coil. They also want to be able to transfer shelf life information. There are rules about combining materials with different shelf lives into one package. One should take the earliest individual material shelf life and make that the expiration date for the overall product.

Genealogy applies to two things: first, the attributes or characteristics, and second, the shelf life. Both need to be carried over. In a formula where the raw material defines the shelf life or the characteristics, the finished good, which will consume the raw materials, needs to inherit the properties of its raw materials.

Here’s a bit of terminology: an end item is a typical formula where something is consumed and made into a finished good. A co‑product occurs when an end item is produced, but there is also a co‑product that can be used for some other purpose—either to resell or to use in another production process. Take, for example, a jumbo roll of paper 60 inches wide. A manufacturer may cut five 11-inch rolls out of it, leaving 5 inches of trim. That trim is a co-product. It’s still good and can be reused or re-blended to make more paper.

Fullscope Process Accelerators set lot genealogy at the formula level and allows inheritance for both end items and co-products.

Product Sequencing

The Process Accelerators also add key capabilities to Dynamics AX in this arena. It adds functionality that considers demand for a product having a certain characteristic such as color, flavor, or package size that can prove problematic if produced out of sequence; or, conversely, it may prove more cost effective if sequenced properly.

Consider paint production. Sequencing from light to dark (white-yellow-green-blue-red-black) can minimize cleanup and setup during changeover. The Fullscope Process Accelerators allow manufacturers to define an optimum sequence based on prioritization of simple or complex characteristics of the product.

So What’s the Takeaway?

Process manufacturers focus their business activities around the development, manufacturing, assembling, and selling of products and the delivery of related services. The defining characteristic of process manufacturing—namely, that once a process manufacturer produces a product, that product cannot be reduced back to its constituent parts—makes control of the manufacturing process critical and risk-intense.

By providing more powerful functionality to Microsoft Dynamics AX ERP, Fullscope Process Accelerators help strengthen the already strong position of Dynamics AX among mid- to large-sized process manufacturers in the chemical, pharmaceutical, food processing, pulp and paper, metals, and cosmetics/health and beauty segments. It does so by leveraging three key areas—potency, lot genealogy, and product sequencing—to mitigate risk, provide more efficient and effective control of the manufacturing process, and improve both asset valuation and margins to better compete in a demanding global marketplace.