Choosing which software systems your company should invest in can be challenging. For many businesses knowing when to move to an ERP system can mean the difference between growing their businesses or getting throttled by software that no longer supports your team and your company.

For many businesses, moving to a Cloud ERP system is an excellent choice, as investing in modern technology gives the benefit of automation, live information and data as well as a single simplified system to manage all departments. There are only a handful of true cloud ERP’s on the market in 2019. By ‘true cloud’ we are referring to the technology that the software system is built on. Older ERP’s such as Epicor, Pronto and Microsoft Navision were designed to be installed as a single instance to a server located in your premises. To make these into “cloud” ERP’s they have simply connected them to a hosting server, which is good because you can access the software through a browser, but it is not a true multi-tenanted cloud solution, and users of these systems can expect to have the same issues that are created by on-premises technology. These main problems that are caused are:

1. Expensive and lengthy implementations.
2. Need for customisations that break when trying to upgrade.
3. Expensive report writing and customisation.
4. Poor performance as these systems are not designed to be delivered over a browser.
5. Dated database structures and functionality.

For a small business wanting to make the move to ERP, they should be considering the real impacts of this as they grow. What starts as small problems today can often turn into bigger problems in the future.

Why is ERP different?

A true cloud ERP, like NetSuite, gives businesses a single platform to manage their entire business. Sales and CRM, Accounting and Finance, Inventory and Warehouse Management, Manufacturing and MRP, Project Management, Workflows, Automation, Dashboards and Reporting. Everything a small business currently needs or will end up needing as they grow.

The good news is, that recently NetSuite has introduced a version of their ERP software called SuiteSuccess Starter Edition, which is designed for small businesses with less than ten users, who are wanting to upgrade from MYOB or Xero and move to a single business management platform.

ERP Software Myths

If you ask anyone who has used or implemented ERP software, you will find that there is a wide range of opinions. Over the years, many misconceptions and myths have come from people’s experiences with ERP software. What is important to understand is that not all ERP is equal. There are some excellent ERP systems in the market and some not so great ones. As a business owner, it is important that you evaluate several different options to ensure that you are choosing an ERP software that suits your businesses requirements.

Benefits of ERP

Now that we have clarified some common misconceptions about ERP systems and explained a little more about why Cloud ERP is different, we can move on to discuss the benefits and advantages that ERP offers users.

ERP systems are one of the most important assets for any business as they provide the foundation for managing your businesses data and operations and give your team the tools, they need to do their jobs more efficiently and effectively.

A good ERP system will do five major things for you:

Fixed Monthly Cost for ERP

Most ERP systems now have a SaaS (Software as a service) pricing model, which means that you can plan and budget for the cost of your ERP with certainty. SaaS pricing also includes support and maintenance of the application, so you can be sure that as you grow, the only additional costs you need to worry about is adding more users when required.

Whilst ERP is a serious investment for a small or medium sized business, the benefits and ROI are definable. NetSuite for example, depending on the edition you subscribe to can cost as little as $1200 per month for a small to medium-sized business with under five users. The amount of resource time that a system like this saves is often the equivalent of 1-2 full-time administration resources, so when comparing the cost of additional salaries to the cost of a suitable ERP solution, it makes a lot of sense.

It is also important to note, that Cloud Enterprise Resource Planning (ERP) is a single investment, rather than investing in a number of different ‘best of breed’ software packages and integrating them. When you choose a good ERP, the cost is fixed, there is no need for complex integrations, and you have the functionality to cover every department of your business. For anyone who is looking at investing in an ERP solution, it is a good exercise to detail how much you are spending currently on your IT strategy. Make sure you include:

A product like NetSuite provides one platform to manage everything. Sales and CRM, Accounting and Finance, Inventory and Warehouse Management, Work Orders and Assemblies, Project Management and Job Costing, Field Service Management, Dashboards, Workflows, Automation and more.

Total Visibility in Real Time on any Device

True cloud ERP is a website with a powerful database. As long as a user has access to the internet and a web browser, then they have access to the system. There is no need to be in the office, connected to a network or using remote desktop to see and transact in the system. It’s a simple way to access all information, data and dashboards and minimises time and effort associated making sure your IT infrastructure supports your business.

Also, modern ERP systems can be accessed on many types of devices including laptops, tablets and even smartphones, which means that users have more flexibility when it comes to using the system and is not tied to a desk. With remote workforces becoming increasingly popular this means that when you invest in ERP, you are allowing yourself to support flexible work arrangements and meet the expectation of true mobility that is now becoming a standard for the millennial workforce.

Improved Business Intelligence, Reporting and Planning

When you invest in a single system to manage your business, your ability to report, get business intelligence in real time and plan for the future is massively increased. You are also able to get better insights into business drivers as information from different departments can be linked, related and reported.

When you have multiple systems that each hold their silo of information, it is difficult if not impossible to get true 360-degree visibility of your business. Many businesses currently rely on excel to consolidate data and then spend hours if not days formatting and reformatting this information to try to understand what is going on in their business. This detachment becomes a massive drain on resources and wastes time and effort, when simply having the information stored on one system will completely negate the need for this.

Logistics and Business Productivity Improvement

ERP systems improve business productivity in a number of ways that are not necessarily easy to quantify. While all the productivity and quality improvements help contribute to the ROI of the ERP investment, some companies overlook these productivity gains:

So, Should You Invest in implementing an ERP?

When your business starts to be affected by the limits of your existing cluster of software systems, it is probably time to consider a modern ERP solution. By doing this, you are allowing yourself to define your current and future technology requirements and invest in a system that will help you simplify your IT footprint, take control of your business processes in ERP services and grow without having to add additional headcounts or overheads to your business.

At Klugo we are experts in helping small and medium-sized businesses evaluate, guide them through steps of ERP implementation and continually improve their use of the NetSuite system. Since 2013 we’ve helped hundreds of Australian businesses across a wide range of industries and verticals to leverage the power of the world’s leading ERP tools, NetSuite.

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Brief Recent History of Cloud ERP.

Over the past 15 years, most “On-Premise” software vendors have clamoured to come to market with a cloud offering to satisfy the needs of increasingly savvy CFO’s. Interestingly, we now find ourselves in a critical junction where the difference between true-cloud solutions and fake-cloud solutions is starting to become more apparent.

Many customers who have invested in upgrading their existing on-premise ERP solution to their software vendor’s “new and improved cloud solution” are beginning to realise that the differences between hosted cloud and true-cloud are quite significant.

Software developers realised quite a few years back that cloud technology was going to change the industry permanently. When evaluating whether or not they too would look to develop a true-cloud version of their products offering, the reality of such an undertaking became apparent. A number of software companies had multiple failed attempts; they invested millions if not billions of dollars in trying to not only migrate their technology platform to the cloud but also:

Indeed, it was a tough time for traditional ERP software companies with no easy solutions or answers to the problem.

So, what was the problem?

Simple, their technology suddenly became obsolete and in the long-term could not compete with the features, platform and benefits that the emerging true-cloud technologies, such as Salesforce and NetSuite could offer to their customers.

These true-cloud vendors seized the opportunity to invest the money that other older software companies were spending on moving to the cloud, and instead poured this into R&D for better features and functionality for their users. In addition, the SaaS model of pricing meant that a true-cloud vendor’s focus was and continues to be on new customer acquisition and long-term customer retention.

Benefits of the SaaS Model.

The SaaS model is like an insurance policy for customers. If the software is no longer fit for purpose (either through growth, changes to a company’s operations or some other factor), they can simply leave and select another vendor.

Furthermore, because Cloud ERP takes far less time to implement and go-live (Klugo have had client’s go live on NetSuite in as little as eight weeks), migrating to a new product isn’t the protracted and painful process it has been in the past.

How on-premise Perpetual Pricing turned out to be slow suicide.

You see, the traditional On-Premise module of pricing meant that customers had to pay a higher once off licensing cost. The problem is that they had to pay ongoing “maintenance” and support annually, to continue to have access to the latest updates and necessary support from the vendor.

Here’s the second problem, because on-premise software is a single instance on their server, more likely than not, businesses chose over consecutive years to not upgrade, which meant their yearly maintenance fee was wasted and their version neared a point where it would become unsupported.

A growing business in 2019 needs to understand the difference between True Cloud Technology Model and the Fake Cloud Hosting model used by the majority of legacy applications.

Is your cloud software True-Cloud or Fake-Cloud?

We would suggest if you aren’t using Xero, NetSuite or Salesforce, then probably not (with a few exceptions).

An easy way to tell is to ask yourself the following questions:

What does that mean?

So, what does this mean as your business grows? Well, it says you’re probably going to face the same challenges as customers with legacy on-premise software.

1. Time-consuming upgrades that impact the businesses day to day operations.
2. High risk of Customisations, Reports and API’s breaking upon upgrade.
3. Partial re-implementation to get the system back online.
4. High costs associated with Professional Services for upgrading projects.

What benefits can true cloud software bring to your company?

The low cost of cloud software has contributed to its widespread adoption. Cloud computing can save a company massive amounts of upfront and ongoing IT expense. Compared to on-premise software, cloud-based software reduces hardware requirements and the need to spend money on an internal IT resource. According to McAfee, cloud usage is now over 90%, suggesting that companies still using on-premise software are falling behind. With its short implementation time and fast deployment rates. Storing data in the cloud allows for flexible working, and this means that company data is accessible to employees anywhere both in the office and remotely, with easy access on mobile devices too.

At Klugo, we help customers understand the real impact of the decisions they make regarding cloud technology. We assist in the evaluation process of moving to a modern cloud platform and can help you understand the long-term impacts of the type of technology you choose to invest in.

The words “IT strategy” are usually enough to make most Business owners roll their eyes. However Smart business owners understand but when it comes to designing an IT strategy the decisions that are made early on in the businesses life-cycle have a far-reaching impact as time goes on and business requirements change.

Most businesses start out with a core need in two main areas.

1. Accounting and Financial Management
2. Sales and CRM.

There are literally thousands of software packages on the market that aim to provide cost-effective solutions to specific areas of the business’s needs. In most cases, business owners look at potential IT problems through a very narrow window. More often than not, and quite unintentionally, business owners create a cluster of systems with the goal of solving immediate problems rather than looking at the bigger picture.

Typical symptoms of this approach include:

• Duplication of data entry, often across three or four different systems.
• Separate silos of information.
• Inability to gain access to live data.
• Multiple spreadsheets being kept to manage information that is not covered by existing software functionality.
• Increased staff numbers to cope with increased demand.

For a growing business these symptoms not only waste valuable time that could be spent in improving business processes but also cost a lot of money when you consider the amount of time and effort that goes into trying to manage a disparate cluster of software systems.

At Klugo, we help businesses assess the current IT and software strategy and design ways to not only improve this immediately but also plan requirements in the future. More often than not we see businesses that started out small and have either experienced rapid growth or industry changes that have impacted the way they need to capture data and report on information.

“A typical NetSuite customer is either a small to medium-sized business (up to 1000 employees) who has experienced rapid growth or is gearing up for planned growth.” — says Michael Dean, Klugo’s Business Consultant.

Similarly, other businesses that look to make a system upgrade to NetSuite might have some new requirements, such as new reporting for government or administrative bodies, and their current systems cannot support the business’s needs.

In either case, the need to have a holistic software solution to manage the needs of the entire business becomes evident. That’s where NetSuite comes in. For over 20 years, NetSuite has been the leading cloud-based business management platform and has grown to managing over 40,000 businesses worldwide.

NetSuite is different to most traditional or legacy ERP’s as it offers users the ability to start small, with just the modules they need to manage their current business problems, but also gives them piece of mind that they will be able to continue to expand NetSuite’s functionality as the business continues to grow and change.

The Phased Implementation

As a NetSuite partner, Klugo helps customers define which NetSuite edition and module mix is right for their immediate needs as well as putting a continual improvement plan in place to ensure the wider needs but the business has been considered during the evaluation process.

Phase 1. Minimum Viable Solution

Typically, customers will look to “go-live” with the core functionality that will allow them to trade and provide a replacement to the legacy systems the business have been using previously. In most cases this is a phase 1, but the implementation will provide a robust and highly automated solution that manages:

• Core accounting, financial an inventory control.
• Sales, CRM, and customer support.
• Procurement and purchasing automation.
• Dashboards, core reporting and business workflow automation.

Phase 2 – Expanding the Solutions Footprint

After a few months of using NetSuite, we revisit the implemented solution and original goals of the project to identify any areas of core business operation that still needs to be improved.

Phase 2 implementation often provides functionality and automation for:

• Marketing campaigns and lead source management.
• Warehouse automation including barcoding, scanning and printing solutions.
• Payroll, including timesheet entry, expense management and employee purchase requests.
• Work order management and assembly builds.
• Work centre reporting, WIP and job routing.

Phase 3. Continual Improvement through Managed Services

Once customers have implemented NetSuite across all departments of their business, they now look to undertake continual improvement activities to ensure that their users are improving their use of standard NetSuite features as well as making the most of new features and functionalities that become available at each new release.

At Klugo, our Customer Success Team works closely with our clients’ key NetSuite champions to ensure that there is a clear plan for continual improvement and to guarantee that they are getting the most out of their investment into the world’s leading cloud technology. NetSuite is a very comprehensive management platform, and we encourage our customers to always look for new and better ways to use NetSuite across the different departments of their businesses.

If you’re new or an existing NetSuite customer, we would like to discuss how we might be able to help you improve your current implementation as well as partner-up to continually improve it in the future. Feel free to reach out to one of our business consultants for a confidential and obligation free discussion.

Digital disruption is well and truly underway in the medical device distribution industry, and businesses must reinvent themselves as digital companies to stay ahead and relevant in this ever-evolving market.

New digital tools and technologies on the market are disrupting the usual product-and-service development processes, customer interactions, delivery management, back-office operations and supplier relationships.

Many medical device distribution companies are focusing on new technology to overcome challenges and improve customer relations, minimise costs, streamline operations and better manage changing industry regulations.

We’ve compiled four steps to successful digital transformation in medical device distribution.

1. Identify and Prioritise Critical Value Sources

Firstly, businesses determine where they provide value to customers and clarify how the use of digital technologies can enable these activities.

Following this, distributors then need to decide how best to adjust investments in digital technologies and development approaches to meet the highest priorities.

In Australia, the Medical and Scientific Equipment Wholesaling industry has performed well over the past five years, the industry revenue is expected to increase 3.6% annually in the end of 2018-19, to reach $17.6 billion. IBIS World indicates that the most important key success factors for the industry are:

• Having favourable contracts.
• An extensive distribution network.
• Offering a broad range of payment options.

2. Build Service-Delivery Offerings

Medical device distributors are increasingly building and increasing their offerings to expand on their product portfolio and services.

Companies are taking the time to understand user needs in full detail, using real-time insights to re-imagine workflows as complete activities to automate processes and personalise outcomes.

For example, real-time supply chain insights could help medical device distributors reduce general and admin costs, while improving customer service.

3. Modernise Business Foundations

When digital priorities have been identified, the next step for medical device distributors is to examine their IT foundations and ask the important question: is your system fully capable of supporting required activities?

Complex legacy systems are often the turning point in companies choosing to go digital. While these systems may have been suitable years ago, nowadays they’re often fragmented, slow and unable to offer transparency in business operations.

To support strategic priorities and agile development approaches, businesses seek to modernise their IT Systems to build a solid, reliable and flexible platform for quick and easy access to a “single source of truth”.

4. Strengthen Core Capabilities 

Transformations require strong core competencies in several areas of the business.

The winners are those who move quickly to initiate change and embrace new developments and operating models, relying on real-time data driven insights to make crucial business decisions.

It’s the medical device distributors who are reinventing themselves as digital enterprises; adapting and collaborating, and most importantly, keeping up with changes in the industry.

References

• IBIS World
• Australian Trade Commission

Products like MYOB and Xero provide outstanding accounting functionality. However, as businesses grow and prepare for the future, they find that the complexity of managing their distribution operations increases, and the limits of these entry-level software packages can become a daily frustration.

Suitesuccess Starter is the ideal solution for growing businesses to painlessly upgrade from stand-alone accounting packages and offers functionality to streamline your inventory management, demand planning, work order and more. If you re sinking in a sea of systems, spreadsheets, integrations, API’s, read on.

Differences in Xero vs NetSuite.

While Xero and NetSuite are ranked amongst the best online accounting solutions in the world, their scope and targets are different. Xero’s aims to solve day to day accounting and is not part of a larger suite. NetSuite, on the other hand, is part of a comprehensive and integrated suite integrated ERP/CRM at lower cost than traditional vendors like SAP or Microsoft Dynamics.

Both Xero and NetSuite Financials provide a full range of accounting capabilities like accounts receivable and payable, integrated banking and reconciliation, invoicing and billing, expense tracking, reporting, tax management, payroll, budgeting, and forecasting, etc. But NetSuite covers a wider range of services like CRM, e-commerce, project management, business intelligence, work orders, field service management and others.

NetSuite as more complex product to configure, typically required a several months implementation, but since the introduction of SuiteSuccess Starter Edition, Oracle+NetSuite’s newest product offering, it has revolutionised the way that small and medium-sized businesses approach upgrading from entry-level accounting packages. It can be implemented sometimes as fast as in 45 days.

The solution is an out-of-the-box NetSuite Edition, pre-built with the leading practices for a growing small business, incorporating tailored dashboards, roles, workflows and more. SuiteSuccess Starter edition provides core functionality across:

1. Accounting and Financial Management.
2. Sales, Marketing and CRM Management.
3. Operations and Business Intelligence.
4. Inventory and Warehouse Management.

For over 20 years, NetSuite has been the leader in Cloud ERP for Distributors and boasts some of the world’s leading wholesalers as happy clients.

SuiteSuccess, Your Step-by-Step Guide

Cloud technology has taken hold. Leaders in their industries have already adopted the latest technology as it provides real-time information, access from anywhere in the world, and a better end user experience.

SuiteSuccess is NetSuite’s latest innovation designed to expand businesses upgrade their legacy systems to an industry-tailored out-of-the-box business management platform.

The rapid implementation model is only possible due to the leading practices already built into the SuiteSuccess platform. Hours of implementation and scripting effort has been bundled into the account from the first day, which means customers and implementation partners can focus on loading customer, vendor, item and inventory data into the system, and move into testing without having to build the system from the ground up.

What are the leading practices?

For over 20 years, NetSuite has dominated the Cloud ERP space. With the combined learnings of thousands of implementations, NetSuite has taken this information to build out standard industry practices including a chart of accounts, reports, dashboards, roles, and custom information to give wholesale distributors a platform to grow.

How do you know if SuiteSucess is right for you?

There are four common situations where SuiteSuccess rapid implementation provides a superior experience for customers:

1. You are facing severe time constraints.

• You are currently using a legacy system or version that is going to become unsupported, or your contract is nearing expiry.
• You are starting a new business, with tight timeframes to commence operations.

2. Your current software is preventing growth.

• Legacy systems are preventing you from acquiring new business, or improving current processes to allow for the management of increased demand.
• Your business model has changed, and existing processes and procedures do not translate to the new business strategy.

3. You are hiring more people to handle growth.

• You’re hiring for labour that could otherwise be handled through process improvement and automation.
• You’ve hired more sales, accounting or warehouse staff to compensate for inefficient systems.

4. Your customer service level has dropped due to increased demand.

• You do not have internal knowledge of best practices and need support to ensure that you are operating in the best possible way.
• You’ve lost staff in the business that helps key knowledge in business operations.
• Your staff are being stretched too thin as the business grows.

Klugo are leaders in leveraging the power of NetSuite. As a 5 Star NetSuite Partner, we help businesses take their first step into ERP, and support their ongoing journey to maximise their investment in Cloud ERP technology.

The Cloud Generation

The cloud generation is comprised of later Gen X and millennials. Having grown up with information at their fingertips, their expectations in the workplace are different from previous generations.

What is Cloud Technology?

Cloud technology is any software or application that is hosted online, and delivered as a service via a browser or operating system. Read more about cloud technology. 

The Workforce Today

1946 – 1964: Baby boomers. Workers aged between 53-71 are early IT adopters, prioritising job security with their main method of communication being via telephone. 1965 – 1980: Gen X workers aged between 37-51 care about having a work life balance with a preferred method of contact being email. 1981 – 2000: Millennials aged 17-31 are digital natives, seeking freedom and flexible working – mainly using text messaging/social media to communicate. 2001 onwards are Gen Z, aged 0-17. With Facetime as their means of contact, they are “digital die-hards”. In 2017, millennials make up 40% of the workforce – and by 2025, this will rocket up to 70% of millennials.

The Millennial Drivers

There are three key drivers for millennials:

1. Flexibility.
2. Automation.
3. Real-time information.

Millennials need to be flexible. They need to be able to work anywhere, at any time, on any device. Due to having technology and devices so readily available, the need the power to control their own user experience and continually improve their environments. The ability to automate repetitive tasks is vital. Millennials need to be able to control how and when information is presented to them, and to tweak systems to suit their needs. Real-time information at all times means an open and collaborative information sharing place, in a “google-style” search environment.  Millennials take having information readily available for granted. If they cannot immediately find what they want or if it’s too hard to find, they’ll seek it elsewhere.

The millennial as a colleague

Millennials are more driven by the opportunity for education and training rather than money, as their salary expectations are not as high as previous generations. This creates a need for organisations to focus on staff acquisition and retention; if they cannot keep millennials happy then they’ll leave – resulting in high recruitment rates. With a priority for this generation listed as flexible working, investment in cloud systems is important for businesses. With access to information anytime, anywhere, it creates an open and collaborative working environment to enable millennials to work harder and smarter. By 2040, businesses are estimated to have less office space due to remote flexible working. Get in touch with one of our experts for more information about cloud technology. This content was originally used in a talk at the CFO Symposium. If you’d like to download the full slide deck, please enter your details below.