SaaS Buyer's Guide for Wholesale and Distribution

Preface

It's no secret that businesses are paying more attention these days to the concept of software as a service (SaaS) and how it can be incorporated into IT portfolios.

There is strong sentiment that companies get the most benefit from SaaS when it is part of an overall enterprise architecture, and that SaaS should be on the table anytime a new IT-driven capability is acquired.

Why is SaaS considered the phenomenal new kid on the block? One big reason is speed to value. According to a recent InformationWeek Analytics survey of 281 business technologists (including 131 who now use SaaS), 37 percent cited fast implementation as a major driver. InformationWeek notes that speed is followed by capital expense savings (cited by 28 percent of survey respondents), and operational expense savings (cited by 25 percent). About one-third of companies surveyed describe their SaaS applications as mission critical.

SaaS is never one-size-fits-all, however. IT departments should have a clear framework for evaluating and operating any new model, and a detailed supply chain IT impact assessment should be performed to determine if the SaaS model is a good match for the operation.

Overall benefits such as rapid deployment, lower cost, and scalability must be counter-balanced by other key decision criteria particular to an organization—such as fit, return on investment (ROI) and risk. Evaluations should also take into consideration both long-term ROI and short-term total cost of ownership. Vertical industry expertise and similarities to existing clients also can be strong indicators for precise selection of a SaaS model.

And there are a myriad of options when it comes to SaaS. Organizations must grasp nuances inherent in the different models they evaluate, along with understanding the difference between SaaS, hybrid, hosted, and in-house—and any combinations thereof. Quite often, a "hybrid" deployment model can be a good alternative to a wholesale organizational shift to SaaS.

At a recent conference, "All About the Cloud" (a popular SaaS industry event), Saugatuck Technology analyst and CEO Bill McNee noted that although a healthy portion of organizational budgets will be earmarked for SaaS, it will most likely co-exist with on-premises IT infrastructure for the foreseeable future.

McNee emphasizes the term "interwoven" as opposed to "hybrid," bringing a grounded approach to the SaaS/cloud phenomenon. Building strong, customized bridges between SaaS and conventional IT infrastructure within an organization can provide a way for companies to optimize their operations within a constantly evolving environment.

Lastly, an additional benefit of SaaS is mobility. Secure access outside the four walls of corporate HQ—remote or satellite offices, traveling executives, smartphone access, or access from a home PC—will put a surplus of demand on IT departments' capabilities to deliver... look out for browser-based SaaS apps as yet another alternative, or addition to an "interwoven" portfolio.

So while there's a lot to consider, the range of options and potential benefits of SaaS make it a consideration worth making.

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Introduction: A Buyer's Guide

The wholesale and distribution (W&D) industry has embraced such technological trends as radio frequency identification (RFID), voice-directed order fulfillment, and cross docking, all with a view toward simplifying supply chain considerations without loss of time, money, and resources. Other sought-after benefits of new technology adoption include streamlined information flow, integrated business processes, and access to the type of accurate information required for faster decision making.

Indeed, W&D organizations have implemented applications ranging from enterprise resource planning (ERP) to supply chain management (SCM) execution systems, in order to better manage growth, competitiveness, and regulatory compliance issues. They are also availing themselves of the technological ability to integrate dispersed order fulfillment operations, warehouse management, inventory control, and customer relationship management (CRM) functions.

During volatile economic circumstances, however, organizations within the W&D industry are also seeking ways to lower their technological overhead. Recently, this shift has taken the form of moving away from traditional delivery methods (i.e., on-premise systems) toward software-as-a-service (SaaS) or on-demand applications. Indeed, according to Forrester research from 2009, SaaS adoption rates have increased 21 percent per year (since 2008) across all industries.

From a business requirements perspective, the defining characteristic of wholesale and distribution (W&D) organizations is that they operate as intermediate agents between manufacturers and retailers. Their top business needs thus focus on requirements for

• processing high volumes of transactions,
• maintaining constant communication between upstream and downstream collaborators (manufacturers and retailers/customers, respectively), and
• managing products for multiple competitors within the same warehouse or distribution center.

In this guide we will explore considerations for W&D organizations that are considering adoption of the SaaS delivery model, and examine the particular business issues that arise from this change.

Specifically, we will address the following considerations:

• the differences between SaaS and on-premise delivery models
• SaaS architectures
• SaaS pros, cons, and other considerations
• selection criteria for SaaS-based applications
• viable wholesale and distribution SaaS vendors

Later in this guide, we'll provide examples of SaaS delivery model success stories, as well as a SaaS IT directory, segmented according to business area.

What Are the Differences between the SaaS and On-premise Delivery Models?

Defining the on-premise delivery model is relatively straightforward:

• The software is acquired by the customer up-front.
• The software is installed, deployed, managed, and maintained at the customer's site, generally with a great degree of involvement by the customer.
• The customer provides the in-house infrastructure (e.g., servers, hardware, networks) to support the software.

Defining the SaaS model is slightly more complex, since different SaaS vendors offer different definitions. We'll explore these variations in more detail shortly, but for now we'll note the following SaaS characteristics:

• The software vendor provides customers with access to the software via the Internet.
• The customer pays for this service on a subscription basis (normally per user, per month, or per number of transactions).
• The vendor is responsible for maintenance, upgrades, and software support, as well as the supporting infrastructure.

The major difference between the on-premise and SaaS delivery model lies in the ownership of the software. In the on-premise model, once the software is purchased, the customer owns it. In the SaaS delivery model, the software is not owned by the customer: it is provided to the customer in the same manner as any other service.

About SaaS Architecture

SaaS architecture can be classified in three ways:

Multi-tenant architecture

Multi-tenant architecture is an architecture design in which a software application can be executed in a single instance, while serving multiple organizations or clients ("tenants"). Multiple clients share the application, the operating system, and the hardware. The software is developed in a manner that separates or segments each customer's data so that it is private. The software is accessed through a shared system, which gives each client the impression of working within a distinct application.

Version-based multi-tenant application (AKA "second degree of multi-tenancy")

Version-based multi-tenant application architecture enables organizations to upgrade to new releases when they choose to do so. Each new release shows upgrades as new features that clients can enable when they want. In other words, all tenants are upgraded at the same time, but each organization can choose when to apply these upgrades for its own purposes: the new functionality will be available if and only if the customer enables and configures it. In this scenario, the application still serves multiple organizations, regardless of the version being used by individual organizations.

Isolated or single tenancy

Isolated or single tenancy is an alternative to multi-tenancy. In this case, each client or organization is running a unique instance of the application. In this scenario, each instance can be configured with more freedom to meet the individual needs of a client. No application or data is shared amongst clients.

For the purposes of this guide, we will not segment our discussion according to specific application architectures, instead focusing on more general SaaS considerations.

Another aspect to keep in mind is that SaaS-based applications can be designed and delivered to organizations in three different ways, as determined by the service agreement and pricing structure established between the buyer and the SaaS provider:

1. SaaS application + application management + hosting services

An application can be delivered by the software vendor inclusively as a service where the software vendor manages the software, hardware, networks, technology, and infrastructure.

2. SaaS application + application management

A software vendor may focus on building the application and on application management, but leave the hosting of the application to hosting service providers.

3. SaaS application only

A software vendor may develop the application and business process, leaving application and infrastructure management to other service providers.

SaaS Misconceptions, Mixed Truths, and Caveats

Although SaaS is not a new concept, many IT and business decision makers are reluctant to move toward this delivery model. This reluctance stems from many reasons—ranging from misconceptions to valid concerns. In this section of the guide, we will explore some of the considerations you should evaluate when it comes to SaaS.

1. Misconception: SaaS cannot offer all the functions required for business operations

Many technology decision makers consider SaaS-based applications to be trimmed-down versions of on-premise software. This is not always true. There are SaaS solutions that have the same depth and breadth of functionality as on-premise applications. For example, TEC's Evaluation Center data shows that accounting/financial SaaS product Intacct provides equivalent or greater accounting functionality than some of the full-fledged on-premise offerings in our Accounting Evaluation Center.

In fact, all SaaS applications differ in terms of form and functions, as with on-premise software. Organizations need to evaluate the features and functions that are important to them, and determine which are provided by a given SaaS application.

2. Misconception: SaaS cannot handle customizations for unique business processes

It's true that SaaS vendors typically don't provide the ability to modify the source code of the application: the fundamental philosophy of SaaS application development is to provide a rich feature and function set that obviates the need for customization. Also, customization is generally discouraged within SaaS applications because updates and upgrades (frequent occurrences for SaaS applications) are more costly and less scalable if the application's source code has been modified.

Another hazard of customization is that it can disrupt the best-practice processes developed by research and development teams that possess considerable expertise in the field.

However, some newer SaaS applications do allow organizations to maintain a customized code base separately from the source code.

Customization that is maintained on top of the core application code enables SaaS vendors to efficiently upgrade without breaking an organization's business-based customization, meaning that organizations can add data fields, change business logic, or configure workflows according to business needs and requirements.

Note that modifications to the look and feel of SaaS applications generally do not require modifications to the source code. SaaS software can also be tailored to particular business needs, as far as parameters, fields, and workflows are concerned. With SaaS users running on a common code, such configurations are stored as metadata parameters, and the redefinition of process and data elements is conducted through modifications to parameters and workflows.

3. Misconception: SaaS cannot handle integration with in-house applications

SaaS vendors tackle the issue of integration through the use of extensible markup language application programming interfaces (XML APIs). Most SaaS data integration projects today are performed using Web APIs. In the past, however, this was more challenging, as Web APIs were generally less sophisticated than they are today. That said, it can sometimes be difficult to use Web APIs to integrate in-house applications, as complex business process with multiple data elements will limit a given API's capabilities.

Another approach used for SaaS application integration is the use of integration service providers: although most SaaS applications are built from the ground up using service-oriented architecture (SOA), traditional integration service providers often do not work with this model. To overcome these issues, SaaS providers will often work closely with specialized integration service providers. These integration service providers have created specific connectors for integration with SaaS applications.

Some SaaS vendors do provide integration as part of their service. This service is offered via an integration server with connectors to partner or common on-premise applications. For example, Informatica Cloud Services helps organizations replicate transactional and master data from SaaS systems to on-premise applications and vice versa.

4. Misconception: SaaS lacks dependability and security

Dependability is an obvious concern for organizations for which any kind of service disruption affects the bottom line. Generally speaking, SaaS service outages do not happen often, as SaaS providers are heavily invested in providing specialized resources for such events—either in their own data centers, or through third-party providers, in order to address issues of availability, security, and reliability. To maintain high levels of customer service, it's crucial for SaaS vendors to provide reliable and secure data center services, 24x7.

SaaS vendors are in the business of providing reliable and continuous service, meaning that they have skilled resources in-house to effectively handle power failure issues, and hardware and network issues, as well as security management. Companies using SaaS applications can leverage these resources, as they are typically included in SaaS service-level agreements (SLAs). As a result, you may find that SaaS vendors are better able to manage risk compared to their on-premise counterparts, particularly if you do not have extensive in-house resources or backup plans.

As far as security is concerned, IT decision makers often have the misconception that once their data is outside the organization's firewall, it is no longer secure. This is a bit of a red herring, as even with the traditional IT data center structure (i.e., on premise), an organization's intellectual property can easily be copied or stolen from laptops or other portable data storage devices.

SaaS security concerns are really not much different from on-premise application concerns. Regardless of whether your data resides within your own IT infrastructure or with another company's infrastructure, the same degree of security is required for applications, servers, and networks. To be fair, there is a real security issue in the sense that you are losing control over the servers themselves. Putting your security concerns in the hands of another company is certainly a deviation from the accepted (i.e., traditional) wisdom, but is not inherently a bad idea.

5. Mixed truth: SaaS costs are higher than on-premise application costs

Many IT decision makers and CEOs believe that the SaaS delivery option is more expensive than outright license ownership in the long run.

However, consider that in the on-premise model, the software is not necessarily owned outright by the company: typically, only a limited number of licenses are granted. Also, the IT infrastructure, security, and compliance measures must be managed by the purchasing organization, which means additional costs on top of the licensing fees.

A few points to keep in mind when considering the costs of SaaS versus the on-premise delivery model:

• The subscription pricing model lets organizations pay for the software on a monthly basis rather than investing up front for software, which eliminates the immediate financial burden for the organization, and lets it strategically allocate the cost of software within its budget.
• Within the SaaS model, the vendor is responsible for the application infrastructure, including its servers, security software, and support staff to keep it up and running. The purchasing organization does not have to pay additional costs for these services, as they are included in the pricing model.
• Organizations see savings in real estate and utility costs with the SaaS delivery model, as they no longer require the floor space and cooling systems necessary for on-premise servers.
• By moving to SaaS applications, organizations can realign and free up valuable staff for more strategic initiatives, as application-related issues are handled by the SaaS vendor (i.e., if the application is not performing a specified task according to expectations, it's the vendor's responsibility to address the issue).

However, it is true that in the long run, SaaS costs run the risk of rising higher than on-premise solution costs. Organizations adopting SaaS may wish to evaluate a timeline for switching back to the on-premise version of the software. If this is a likely scenario, it's important that the adopting organization have the same infrastructure (i.e., servers, databases, network and operating systems, etc.) as the SaaS provider in order to avoid additional costs.

6. Misconception: SaaS does not provide robust compliance measures

Many CFOs believe that with SaaS applications, it's impossible to stay current with compliance and regulatory changes.

This is not true: it is relatively straightforward to configure, test, and implement SaaS applications, meaning that if compliance requirements change, new information can be incorporated and deployed to system users without delay. The user organization will need to configure the new requirements within its business processes to ensure that the new functionality adheres to regulatory and compliance requirements

7. Caveat: Internet connectivity is a requirement for SaaS

By definition, a SaaS application requires the user organization to have an Internet connection. If its Internet connection goes down, or if its Internet service provider (ISP) suffers service outages, SaaS accessibility is non-existent. Also, there are constraints when it comes to transferring large files over the Internet. For example, typical Internet connection speeds of 100 kBs to 1,000 kBs may mean delays in transmitting information.

Another consideration that you need to keep in mind is the time of day your operations are in full swing, since your ISP's bandwidth varies according to how many users are using its services. If the ISP's service is slow during your peak hours, this will affect your ability to access the SaaS application. To overcome this issue, you may consider implementing dedicated Internet connections, so as not to have to share bandwidth with other users.

8. Caveat: data storage issues can be a concern

SaaS providers may help you meet such compliance requirements as the US Sarbanes-Oxley Act (SOX), the Gramm-Leach-Bliley Act (GLBA), and the Health Insurance Portability and Accountability Act (HIPAA), but SaaS providers may need to provide additional measures to meet data transfer and data privacy requirements in the context of international regulations.

For example, if a customer relationship management (CRM) SaaS provider data center resides in the US, but the user of the service resides in France, all data in the data center is subject to US discovery laws, according to US regulations. Each country has its own specific regulations, so the onus is on the organization to make sure its data is not stored in a country where sensitive data may have to be shared with governmental or regulatory authorities.

SaaS Application Selection Criteria

Clearly, features and functions are one aspect of the software selection process, but there are other factors that influence a sound decision, particularly in the case of SaaS applications.

1. Delivery model flexibility

A SaaS vendor that can also provide an on-premise model offers the flexibility to change models as your business needs change—without modifications to configuration or the user interface

2. Ability to use the application on trial

Trying the application (with no strings attached) can give you valuable insight into the application's usability and interface, as well as a sense of how quickly tasks can be completed.

3. Integration with other applications

If you have an understanding of the number of required integration points, and how the SaaS vendor will integrate (whether through APIs or an integration server), this will give you an understanding of the likely length of the implementation process.

4. Business process remodeling

Understand what kind of source code customization is required based on internal business process. Make sure you understand how workflows are created (point-and-click versus technical programming) and what kind of SaaS system integration and technical services are provided with the pricing model.

5. Security

Determine the layers of security that exist within the application and the server. How will the SaaS vendor protect your data from viruses, hackers, and theft?

6. Platform/mobile compatibility

Make sure the SaaS application is fully functional on multiple operating systems and Web browsers being used at your organization. Also verify its accessibility via mobile devices if needed.

7. Backups and Recovery

When evaluating a SaaS provider, learn about its contingency, backup, and recovery plans and liabilities.

8. Upgrades

SaaS vendors typically provide quicker response to innovation and new features, since deployment cycles are shorter than for on-premise applications. However, ensure that these upgrades are indeed applied regularly and free of charge. Assess the vendor's roadmap of product upgrades, and determine how often they are expected.

9. Service level agreements

Clear service level expectations must be documented within the SLA, including penalty clauses for undelivered services or unmet expectations. Ensure that the SaaS vendor provides services beyond application delivery (e.g., business issues resolution, training, implementation support, customer service).

10. Training and Support

In order for SaaS application to be used by users to its fullest potential, training is required. Make sure the SaaS provider has well-developed training programs. Along these lines, determine what kind of training is provided for new users, as well as for system upgrades. Also, ensure that the SaaS provider can handle support enquiries if your organization runs into problems or has specific questions.

11. Scalability

Evaluate the SaaS provider's scalability through such infrastructure points as bandwidth, load balancers, servers, data warehouses, etc. Analyze its long- and short-term growth strategy and level of service. Will the SaaS provider be able to maintain and improve service levels with the growth of its business and clients?

12. Reference checks with existing customers

To evaluate a SaaS provider's ability to handle your organizational requirements, conduct reference visits to established clients that have been with the SaaS provider for longer than contracted by initial terms. This will demonstrate whether the provider is effectively able to maintain its customer base. On-site visits will also help you see the technology in action, and get feedback about the system and its provider.

13. Vendor viability

As SaaS vendors are typically relatively new players in the market, you should consider a SaaS provider's financial robustness. Focus on revenue streams (since pay-as-you-go revenues need to be maintained) and venture capital (investors backing the company) to assess whether the vendor will be around and able to grow as your organizational needs grow.

SaaS Wholesale and Distribution Vendors

The table on page 16 focuses on specific vendors providing solutions via the SaaS delivery model to the wholesale and distribution industry. We'll examine vendor's capabilities across four main business areas:

• SCM
• distribution process management
• retail and commerce
• back-office operations

 

About SCM

SCM is the process of managing suppliers, manufacturers, wholesalers, retailers, and customer business processes across five major areas:

• Warehouse management systems (WMSs) enable warehouse operators to optimize pick, put away, and replenishment functions by employing powerful system logic to select the best locations and sequences.
• Transportation management systems (TMSs) allow organizations to create profiles for all contracts, associated carriers, and trade lanes for intermodal and multi-leg moves. These systems should support regional as well as international transportation movements.
• International trade and logistics (ITL) software helps trading partners engage in an electronic dialogue to collaborate in acquiring, transferring, transporting, and settling accounts.
• Supplier relationship management (SRM) software enables companies to communicate and collaborate with partners and suppliers regarding products, services, compliance, and logistics.
• Procurement software enables the requisitioning and purchasing of goods (usually from catalogs) that a company requires for its operations.

 

About Distribution Process Management

Distribution process management provides workflow and process management to the supply chain. It includes the four categories below:

• Process management software manages the actual physical handling of goods moving throughout the supply chain.
• Inventory management provides record-keeping of warehoused goods, and manages the movement of these goods to, from, and through warehouses.
• Purchasing management software manages the purchasing of the raw materials needed to produce semi-finished or finished goods, and tracks suppliers' compliance to contract terms.
• Sales management automates the data entry process of customer orders and tracks their status.

 

About Retail and Commerce

Retail and commerce software enables the sale of goods and services directly to consumers. It includes the following categories:

• Retail and point-of-sale (POS) software records, tracks, and analyzes data and transactions at retail locations, whether online or brick-and-mortar.
• Web commerce provides the ability to search, compare, and purchase goods online.

 

About Back-office Operations

Back-office systems record, track, and analyze the data necessary to manage and run the organization. Within back-office operations, there are three categories:

• Business Intelligence (BI) applications aid in the analysis of business and transactional data. They provides reporting and analysis capabilities tied to workflows in order to understand the impact of each decision being made within business processes.
• Human resources (HR) manages the personnel-related tasks for corporate managers and individual employees, including personnel management, benefit management, payroll management, employee self-service, and health and safety.
• Financials applications manage the financial resources of the organization, including accounting and financial reporting, budgeting, collection of accounts receivables, and risk management.

The ratings on page 16 are based on vendor claims for solution functionality in these four areas. Functions may be supported either out of the box or through modification. Note that these ratings are intended as a guide only. To determine which solution best meets your organization's requirements, you should conduct a comprehensive evaluation and comparison analysis.

The industry column displays the industries supported by a given vendor. The geography column indicates the regions or areas where a given vendor provides either full or partial support and coverage.

To consult contact details for other vendors offering wholesale and distribution SaaS software, please see the Vendor Directory at the end of this guide.

Download the PDF to see the detailed vendor matrix, including information on VENDOR A, VENDOR B....

We devote the following sections of this guide to thoughts and case studies from software vendors that are focusing on SaaS as a viable model for wholesale and distribution.

We've grouped this material into four thematic areas:

• Adaptability and Agility
  SAP presents its perspective on SaaS and some of the ways this delivery model can help organizations adapt to business and market change.
• Manufacturing and Distribution
  Epicor provides thoughts on the practical benefits manufacturers and distributors can derive from SaaS, followed by a TECSYS case study focusing on SaaS in action.
• Growing Your Company with SaaSNetSuite takes a look at the particular challenges faced by SMBs, and provides eight reasons they should give serious consideration to SaaS.
• Distribution CentersBond Talent presents thoughts on the unique challenges of distribution workforce management—and the road ahead for the distribution workforce—followed by an IBS case study that explains how distribution management software helped one company save 15 to 20 percent in total operating costs.

 

Spotlight on Adaptability and Agility
Thought Leadership from SAP

SAP's Perspective on Software as a Service

In today's fast-paced global environment, business users and their companies need to relentlessly streamline business processes, collaborate across their business, receive actionable and timely insights into their business performance, and use that knowledge to make informed decisions—fast!

Often, competitive advantage depends on your ability to manage costs more effectively and increase revenues, obtain insight, and have the flexibility to adapt quickly to new market realities. At the same time, you need a technology solution that supports end-to-end business processes to help you manage your business more effectively and support the sustainable growth you need to be successful well into the future.

However, more and more companies are finding their technology infrastructure is an obstacle to growth because it lacks the flexibility to adapt quickly and grow as their needs change. Software as a service (SaaS) is an increasingly attractive option for companies facing these challenges.

SaaS is a broadly adopted and reliable way for companies to build a unified IT strategy, without the up-front and ongoing investments in an IT infrastructure. In addition, SaaS means you don't have to manage an IT infrastructure, the ongoing costs associated with it, or the expense of modifying it to change or grow.

With an integrated SaaS solution, companies can obtain the benefits of the individual business applications, and deploy solutions to address immediate needs such as strengthening core financial capabilities or streamlining supply chains. In addition, on-demand software applications enable companies to lay the foundation for a stronger, more agile business with end-to-end processes that cross departmental boundaries.

This enables you to

• streamline business processes,
• maximize revenue opportunities,
• improve efficiencies,
• reduce costs, and
• build a business that is ready for growth and change.

It also means that you can do more with fewer resources and focus on what you do best—running a successful business. Let software vendors, such as SAP, manage your business applications and technology infrastructure.

On-demand software solutions also provide the flexibility of adapting your IT infrastructure to changing demands—without the high cost and business disruption often associated with on-premise systems.

Your On-demand Provider: A Critical Business Partnership

Another factor to consider in selecting an on-demand software solution is the provider itself. This is a critical decision. Beyond the functionality provided by the software, on-demand software buyers need to look at the provider's expertise in managing the solution, the safeguards implemented to ensure it is available when you need it, and security considerations that ensure your data is safe from loss or external intrusion.

Furthermore, companies need to consider the level of service the vendor provides and the long-term viability of the company to ensure they have the substance and financial staying power to be around for the long term.

SAP Business ByDesign is the most complete, fully integrated business management solution delivered on demand. The solution is a core part of the SAP on-demand portfolio and is specifically designed to provide small and medium businesses with the benefits of a large-scale business management application without the need for a large IT infrastructure. It enables companies to solve immediate problems at an affordable and predictable price, and achieve fast time-to-value.

SAP Business ByDesign provides the best of SAP on demand in a suite of robust applications for managing financials, customer relationships, human resources, projects, procurement, and supply chain. It also provides embedded analytics and reporting that give you timely information for more confident decision-making. The solution is designed to allow customers to either implement the entire solution, or start by adopting only the applications they need to address their current business requirements.

SAP Business ByDesign is managed, monitored, and maintained by SAP experts in world-class hosted data centers. These data centers feature state-of-the-art technology to ensure Business ByDesign is available when you need it and your data is protected both from loss or unauthorized access. SAP also takes care of the maintenance and installation of upgrades, so companies can focus on their business—and not on the cost and complexities of managing an IT infrastructure. In addition, SAP provides Business ByDesign customers with the financial certainty and trust that comes with being the global leader in business applications. SAP has been in business for over 35 years, and is highly profitable and strongly capitalized, which assures our customers that we will be there for them year after year.

On-demand software can provide critical advantages to companies—particularly fast-growing small- to medium-sized businesses. SAP Business ByDesign incorporates over 35 years of experience in managing the critical business functions of the world's largest and most complex businesses in a solution tailored for small and midsize businesses.

If you are ready to become a best-run business, visit www.sap.com/sme and investigate the SaaS capabilities offered by SAP.

About SAP Business ByDesign

SAP Business ByDesign is a fully integrated business management software solution designed for midsize companies or small businesses that want the benefits of large-scale business applications without the need for a large IT infrastructure.

The software enables preconfigured process best practices for managing financials, customer relationships, human resources, projects, procurement, and the supply chain. SAP takes care of installation, maintenance, and upgrades—so you can focus on your business, not on IT.

SAP

www.sap.com
info@sap.com
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Case Study

SAP Success Story
Johnson Products Capitalizing on New Sales after 30-day SAP Deployment

Johnson Products, a midsize start-up based in Dallas, Texas (US), is the heir of George Johnson's work. Beginning in 1954, the Chicago entrepreneur began designing hair and beauty products for African-American customers. For more than 50 years, brands such as Ultra Wave, Ultra Sheen, and Gentle Treatment propelled the growth of Johnson Products, making it the first minority-run business on the New York Stock Exchange. Purchased by Procter & Gamble in 2003, the company was then acquired by a veteran brand and business management team in 2009.

Upon acquiring the business from Procter & Gamble, Johnson Products shifted into high gear. "Contractually, we had no choice but to implement a business solution and get it operational within 30 days," says Eric Brown, CEO of Johnson Products. "There was no option to move the deadline."

What's more, the company was determined to meet or exceed its already high customer service levels during the transition. Johnson Products needed to quickly choose and deploy a business solution to support its operations. The company formed a cross-functional team to research enterprise resource planning software solutions.

"I chose SAP software to be that standard, thinking we would never be able to afford an SAP solution," Brown says. "As we learned more about SAP, I was surprised that it not only had a solution that fit our scale, but one that also met our budget requirements." Together, Johnson Products and the SAP Services organization deployed the solution in less than four weeks.

SAP's partnership with Crossgate AG, a business network services provider that helps suppliers quickly integrate with the electronic processes used by global trading partners, including leading retailers, was also an advantage. Each retailer has unique processes for handling orders, invoicing, and other essential supplier–retailer activities. The Crossgate solution extends information captured in SAP Business ByDesign, presenting it in the appropriate format to each retailer and allowing suppliers like Johnson Products to begin working quickly and accurately with their customers.

Will Pence, Technology Manager for Johnson Products, says that the intuitive interface of SAP Business ByDesign has made it easier for new business users to learn how to use the software. "It's very easy to use," he says. "It's basically just like any other Microsoft Windows package. You point and click, drag and drop, copy and paste. We've had many of our new hires pick it up very quickly."

The usability of the SAP solution combined with the critical information it brings to light offers the best support for Johnson Products' ongoing innovation; by using the solution to identify trends in customer-buying patterns, business users can capitalize on new sales and product development opportunities.

Rapid access to current data can help the company bring new insight to a buyer—business intelligence that will add value to Johnson Products and its retail customers. "Anyone can go to a buyer with a new promotion," says Brown. "But if I can use the SAP solution to show how a retailer can be more profitable by teaming with Johnson Products, now we have something to talk about."

About SAP Business ByDesign

SAP Business ByDesign is a fully integrated business management software solution designed for midsize companies or small businesses that want the benefits of large-scale business applications without the need for a large IT infrastructure.

The software enables preconfigured process best practices for managing financials, customer relationships, human resources, projects, procurement, and the supply chain. SAP takes care of installation, maintenance, and upgrades—so you can focus on your business, not on IT.

SAP

www.sap.com
info@sap.com
1-888-342-5727
3999 West Chester Pike
Newtown Square, Pennsylvania
19073
USA

Spotlight on Manufacturing and Distribution
Thought Leadership from Epicor

 

SaaS ERP for Small Manufacturers and Distributors

As small to midsize businesses attempt to keep pace with escalating competition and a demanding business environment, most realize that an enterprise resource planning (ERP) system can help streamline their business processes and improve operational efficiency. In fact, through recent research the Aberdeen Group determined that ERP software helped top-performing companies cut administrative and operating costs by 14 percent.

While an ERP system is a proven solution for running a business more efficiently and effectively, for small manufacturers and distributors high initial costs (including software, hardware, and supporting infrastructure), lengthy and complex implementation projects, and the staffing necessary to implement and maintain ERP systems all become barriers in implementing or upgrading.

These practical concerns are key factors driving the increasing adoption of cloud computing and software-as-a-service (SaaS) solutions within smaller manufacturing and distribution companies. According to industry research, SaaS is no longer a fad; it has become more mainstream. Indeed, Gartner forecasts that SaaS deployments for enterprise software will grow 19.4 percent annually between 2008 and 2013, and by 2013, 14 percent of all enterprise software will be provided in the SaaS model.

The fact is, companies are increasingly viewing SaaS ERP as a compelling option and a smart investment because it offers a myriad of business benefits, including low initial and predictable ongoing costs, faster implementations and time to value, reduced cost of ownership, greater reliability, improved support, reduced IT complexity, and improved business focus.

Epicor Express: A Comprehensive SaaS ERP System for Small Manufacturers and Distributors

Epicor understands the fiscal complexities, capital constraints, and challenges confronting organizations in today's business environment. With these business challenges in mind, Epicor developed Epicor Express—the on-demand cloud computing edition of its award-winning Epicor 9 next-generation ERP solution. Built on the same code base as Epicor 9, Epicor Express combines broad functionality from across Epicor's latest-generation release into a complete end-to-end solution.

The Express delivery model is designed to help customers reduce complexity, get up and running quickly, and decrease ongoing operational costs—enabling companies to focus on their core business operations instead of managing IT. Delivered in a subscription-based licensing model, Epicor Express offers organizations all the real-time business management capabilities of its on-premise counterpart, but in a flexible deployment model that is tuned specifically to the way their organizations need to operate, ready to help them with the unique challenges and opportunities they face.

Benefits of Delivering Epicor Express via the Cloud

While this paper has briefly mentioned some of the benefits of delivering Epicor Express in the SaaS model, the model offers a wide range of financial and operational benefits, including

• low initial and predictable ongoing costs
• faster implementations and time to value
• reduced cost of ownership
• greater reliability
• reduced IT complexity
• flexible foundation
• improved business focus

 

Low Initial and Predictable Ongoing Costs

Because Epicor Express is provided on a subscription basis, companies with limited budgets can substantially reduce their initial capital costs of investing in an ERP system. Instead, the software becomes a monthly operational expense that allows customers to spread the cost over time in a pay-as-you-go manner.

Faster Implementations and Time to Value

As Epicor Express is hosted and managed by Epicor, there is no hardware to set up or software to install—the implementation is solely focused on configuring the system and, if necessary, importing data. Epicor Express comes pre-configured based on best practices to further simplify and expedite the implementation process. This translates into faster, less complex implementation projects. This, along with the fact that customers invest little upfront capital, means customers receive the benefits provided by the system as soon as they go live; they achieve a faster return on their investment.

Reduced Cost of Ownership

With Epicor Express, customers pay only for users that actually use the software. They don't need to invest in all the peripheral resources and technology to support an on-premise deployment. If the needs of the business expand over time, they simply add additional users at a pre-specified cost without worrying about investing in additional resources (e.g., hardware). In addition, with the shared, multi-tenant SaaS model, Epicor is able to pass along lower costs due to the economies of scale achieved through the use of a shared data center, network, and management services.

Greater Reliability

Because of the economies of scale associated with Epicor Express, Epicor has made significant investments in skilled staff and technology well beyond that which an individual company traditionally makes. These investments go towards ensuring performance, reliability, and security. In addition, Epicor offers a service level agreement that guarantees uptime, assuring customers of the system availability.

Reduced IT Complexity

As the SaaS model transfers the burden of managing and keeping the system up to date and running from the customer to the software vendor, Epicor takes responsibility for maintaining the entire range of infrastructure, including networks, storage, OSS, databases, application servers, Web servers, and disaster recovery and backup services. Further, SaaS eliminates the need for customers to upgrade their software to the latest release and to update outdated infrastructure to support major software upgrades, including hardware. Epicor takes responsibility for all upgrades, ensuring the system is always running on the most up-to-date hardware and the latest software version.

Reduced IT Complexity

As the SaaS model transfers the burden of managing and keeping the system up to date and running from the customer to the software vendor, Epicor takes responsibility for maintaining the entire range of infrastructure, including networks, storage, OSS, databases, application servers, Web servers, and disaster recovery and backup services. Further, SaaS eliminates the need for customers to upgrade their software to the latest release and to update outdated infrastructure to support major software upgrades, including hardware. Epicor takes responsibility for all upgrades, ensuring the system is always running on the most up-to-date hardware and the latest software version.

Flexible Foundation

A true differentiator from other ERP systems available today, Epicor offers a solution that spans the spectrum of business functionality (i.e., small, midsize, and enterprise) and deployment models (i.e., multi-tenant SaaS, hosted, and on-premise) from a single product line, making it the first to offer businesses the choice and flexibility of both on-premise and cloud computing. Therefore, as customers evolve and grow, Epicor Express can simply scale with them. Or, if they elect to change to another deployment model or Epicor 9 edition they can easily make the move.

Improved Business Focus

Finally, one of the most important benefits of the SaaS model is that it frees the customer from the responsibility of maintaining and managing the hardware, software, and infrastructure associated with ERP systems. Instead they are able to focus on and devote their time, staff, and resources to their core business and new strategic opportunities.

Proven Solution, Based on Experience

Experience matters when it comes to delivering a product or service that meets the needs of an industry, and the right software solution can help you transform your business and operations. Epicor Express is such a solution – providing broad functionality, priced affordably and delivered in a manner that minimizes complexity. For Epicor, this is just the next step in the company's strategy to deliver its next-generation ERP solutions to a wider audience.

About Epicor

Epicor is a global leader dedicated to providing integrated enterprise resource planning (ERP), customer relationship management (CRM), supply chain management (SCM) and professional service automation (PSA) software solutions to midmarket companies and divisions of the Global 1000. Founded in 1984, Epicor serves over 20,000 customers in more than 140 countries. Epicor provides solutions in over 30 languages. Employing service-oriented architecture (SOA) and Web services technology, Epicor delivers end-to-end, industry-specific solutions for manufacturing, distribution, retail, hospitality, and services, which the company aims at increasing efficiency, improving performance, and building competitive advantage. Epicor offers a range of services with its solutions to provide a single point of accountability.

Epicor Software

http://www.epicor.com/
info@epicor.com
1-800-999-6995
+1 949-585-4000
18200 Von Karman, Suite 1000
Irvine, California
92612
USA

Case Study
TECSYS Customer Success Story
LifeScience Logistics Achieves 99.97% Inventory Accuracy With TECSYS' EliteSeries for Healthcare

 

At a Glance

 

Industry

Healthcare

The Challenge

To provide domestic and global healthcare manufacturers with unique, regulatory-compliant distribution facilities and processes.

TECSYS' Solution

TECSYS' EliteSeries for healthcare SaaS (Software-as-a-service) model.

The Benefits

LifeScience Logistics is able to achieve for its customers 99.97% inventory accuracy. It is also enabled to deliver, on behalf of its customers, the right products at the right price without sacrificing on quality.

About LifeScience Logistics (LSL)

LifeScience Logistics is an up-and-coming third-party logistics services provider in the healthcare industry. The company provides a full range of standard and specialized logistics services scalable to the changing needs of its customers.

LSL was founded by two complementary executives: Richard Beeny, an industry veteran with a substantial track record in the supply chain management industry (most notably with one of the largest third party logistics providers, UPS Supply Chain Solutions), and Max Kamhi, a successful entrepreneur and real-estate developer.

Through its cGMP-compliant facilities, LSL enables its clients—small to mid-size manufacturers in the pharmaceutical, biotech, and med-surg fields—to outsource the warehousing and distribution of frozen (-30c), refrigerated (2c-8c), and ambient (20c-25c) products as needed to meet their business objectives.

"With TECSYS we have a reliable IT infrastructure that can be tapped anytime, from anywhere, securely. The system is always available; it is like "googling" into a supply chain network of applications, giving us and our healthcare customers the peace of mind and visibility of what is happening, where and when. Most importantly, it is helping us achieve a high level of customer satisfaction."
Richard Beeny, Co-founder and
Chief Executive Officer of LifeScience Logistics

About the Biotechnology Industry

In the 1970s, the biotechnology industry emerged. Its first innovation was a new "Recombinant DNA" technique; its details were published in 1973 by Stanley Cohen of Stanford University and Herbert Boyer of the University of California, San Francisco, putting the first "blip" on the radar screen for a whole new world of healthcare innovations to come.

In 1982, recombinant human-insulin became the first biotech therapy to earn FDA approval, paving the way for increased acceleration in the industry's product development. Since 1992, the biotech industry has experienced an explosive growth; revenues from US publicly traded companies increased from $8 billion in 1992 to close to $59 billion in 2006, with research-intensive spending in excess of $27 billion.

"In today's competitive environment, healthcare products manufacturers are taking a hard look at capital requirements and are shedding non-core business activities like warehousing and distribution. We specialize in making distribution easy for them."
Richard Beeny, Co-founder and
Chief Executive Officer of LifeScience Logistics

Today, biotechnology is the fastest-growing healthcare industry segment. It has created more than 200 new therapies and vaccines, including products to treat cancer, diabetes, HIV/AIDS, and autoimmune disorders, and has deployed more than 400 drugs and vaccines in clinical trials, making their way through the supply chain in an attempt to reach consumers following FDA approval.

Prior to reaching patients, biotech/pharma products enter a complex supply chain that involves many collaborators and a significant number of handoffs from raw material suppliers all the way to end users. Pharmaceutical and biotechnology companies follow strict standards for packaging, labeling, and documentation, particularly when shipping biological or hazardous materials. It is during this complex process where the management of the supply chain is most critical. Weaknesses or failure at any point in the chain can compromise product integrity, breach security, delay shipments, and ultimately result in financial losses or liabilities.

In the life sciences sector, logistics has made a major shift, moving from the back office to the forefront with executive management becoming more active than ever in the strategy and execution of their supply chain operations. This is particularly true today due to the intense competitive landscape, shrinking profit margins, and regulatory compliance requirements.

Against the backdrop of the evident growth of the biotech/pharma industries and the substantial opportunity for specialized expertise in supply chain for healthcare, LifeScience Logistics (LSL) was founded—its mission: "to provide the highest quality, flexibility, and compliance in healthcare supply chain solutions."

Challenge

LSL's strategy: to create and deploy a "shared-utility infrastructure," in essence a highly secure distribution operation with a virtual data center, providing logistics services that can be shared by a number of customers, regardless of where they are globally. It is an operation that provides customers with unique but standard technology and regulatory-compliant processes to be able to consolidate their distribution operations.

In addition to its domestic clients, LSL has targeted offshore small to mid-size pharmaceutical and biotechnology manufacturers, particularly in Europe. Small biotech/pharma companies' core value is research & development, typically driven by dynamic scientists and researchers. Their need is for a structure to outsource their logistics operations and enter the US market. US presence for these offshore biotech/pharma manufacturers requires US Principal Party in Interest (USPPI) to facilitate their customer support and imports to the US.

"There is an appetite for total logistic solutions that encompass an order to cash model for offshore manufacturers. In reality, we are the local representatives for these offshore companies in the US.
Richard Beeny, Co-founder and
Chief Executive Officer of LifeScience Logistics"

With LSL's shared utility infrastructure, Biotech and Pharmaceutical manufacturers are able to

• leverage LSL's already established and maintained facilities, supply chain technology, and visibility tools to support their expanding product portfolio and supply chain operations;
• have contingency capabilities to mitigate the risk inherent in having "all eggs in one basket," due to the high dollars of controlled substances in one location; and
• focus resources, reduce costs, and improve quality by leveraging LSL's already-established, FDA-compliant integrated technology and processes.

With these benefits in mind, LifeScience Logistics went off to build its shared-utility infrastructure to meet its mission objectives and the needs of its clients. LSL's Beeny set his course to look for a technology solution provider to meet his robust criteria and infrastructure challenges, including

• FDA-compliant processes and technology;
• integrated and robust distribution, warehouse, and transportation management software applications;
• visibility tools to clearly see throughout LSL's supply chain, from cradle to grave, particularly track-and-trace for serial numbers and expiry dates; and
• the ability to handle high-value products, cold chain requirements, and specialized distribution, such as samples, kitting, and service parts.

Overall, biotech and pharmaceutical logistics operations require deep understanding, not only of imports, shipping, handling, and warehousing, but also of temperature control, compliant processes, and regulatory standards. Temperature-sensitive biological materials, active ingredients, and samples for clinical trials play a vital role in bringing to market new drugs. At various phases in the development of these products, they must be stored and transported between sites, biobanking facilities, and analytical laboratories. During transit, warehousing, storage, and distribution, they must be carefully managed to maintain temperature requirements according to manufacturers' and regulatory guidelines. Reducing the chances for human error through systems and processes was key to developing a compliant and effective network.

Solution

Following extensive research among several distribution management software companies, LSL opted for TECSYS' EliteSeries for healthcare SaaS model.

LSL selected TECSYS because of its

• experience and expertise in healthcare products distribution;
• robust, FDA-compliant, integrated distribution, warehouse, and transportation management applications that are easy to deploy, learn, and use;
• visibility technology for business intelligence as well as lot and serial-number tracking;
• Web-based, open technology platform; and
• hosting capability with a solid support organization.

"TECSYS' EliteSeries had already been validated; it was already deployed at McKesson, Cardinal Health, as well as others, making it a proven product for healthcare. That was a big plus in our decision making process."
Richard Beeny, Co-founder and
Chief Executive Officer of LifeScience Logistics

With TECSYS' EliteSeries, the underlying IT infrastructure of LifeScience Logistics is a fully redundant remotely hosted suite of distribution applications that includes Order Management, Warehouse Management, Transportation Management and Financial Management. The system supports an order-to-cash model and includes "charge back" and accounts receivables functionality, both of which are critical in healthcare. The system is validated according to cGMP (The FDA's "current good manufacturing processes") requirements and allows customers to place orders and view inventory in real-time online, as well as check on inventory levels and reconcile outstanding credits or invoices.

TECSYS' EliteSeries SaaS Model allows LifeScience Logistics to

• invest in its core values—its logistics operations—and allocate funds to support its core competencies;
• capitalize on the Web by taking advantage of TECSYS' EliteSeries web-based applications, scalable and available anytime anywhere, along with the short deployment cycle of the EliteSeries SaaS model, and the application's continuous improvements with no disruptions; and
• leverage a light-weight IT Infrastructure: no servers or major network infrastructures, hassle-free support 24x7, and no IT department.

Today, LSL has two cGMP-compliant and FDA-registered facilities; one in Louisville, Kentucky and the second in the Dallas/Fort Worth area; together they represent over 440,000 square feet of distribution hubs, strategically located for optimum flexibility and efficiency for shipping across the US.

LSL customer orders flow from order taking and order processing, through to warehousing activities including picking, packing, kitting, shipping, and reverse logistics with the guaranteed accuracy of radio frequency and bar coding technologies. LSL's customers can easily, securely, and selectively have access to back-office functions such as order tracking, shipment status, invoicing history, inventory visibility, and financial information, confident in the information provided by the system.

"With our order to cash model, customers reap big benefits," stated Beeny. "While some customers only want to outsource warehousing and distribution, others take advantage of the opportunity to focus on their core competency of manufacturing and leave the rest to us. We are able to manage the business cycle that starts with reception of a customer sales order and ends with collection of accounts receivable generated in the sale of the final product, including receiving orders, entering sales orders, approving sales orders, fulfilling orders, billing for the orders, and collecting payment."

Furthermore, with iTopia®, TECSYS' visibility technology, LSL is empowered to manage supply chain issues related to track and trace requirements for its customers. The technology provides powerful event-management capabilities that can notify the appropriate individuals of key events which may impact their decision processes such as a product alert, a customer emergency, an inventory shortage, or a delay in delivery. As exceptions are detected, an alert is sent out to the relevant decision makers who can then use available tools to address the ramifications of corrective action.

"The SaaS model resonates well with healthcare because of the budgetary and speed to market needs. In addition, our focus is on the customer and we didn't want to have to occupy ourselves with an IT infrastructure and a large IT department, both of which are not our core competency but are key to delivering our services."
Richard Beeny, Co-founder and
Chief Executive Officer of LifeScience Logistics

Benefits

Today, LifeScience Logistics' share-utility infrastructure is empowered by TECSYS' FDA-compliant EliteSeries for healthcare, enabling LSL's logistics management to securely deliver, on behalf of their customers, healthcare products at the right price without sacrificing on quality. The uniqueness of TECSYS' integrated applications freed LSL from the enormous challenge of having to deal with multiple IT providers, and enabled them to focus on their customers and on what they do best: nimble logistics services backed by deep expertise.

In addition to the substantial automation achieved with TECSYS' EliteSeries, such as scalable perpetual inventory, significant improvement in labor management with system-directed putaway and picking, as well as unprecedented real-time visibility, LSL has realized the following benefits:

• Fill rate increase to 99 percent
• Inventory accuracy increase to 99.97 percent

LSL also achieved the following:

• Increased workforce productivity and an optimal level of efficiency and picking accuracy
• Increased customer satisfaction

 

"Today, we have a reliable IT infrastructure that can be tapped anytime, from anywhere, securely. The system is always available; it is like "googling" into a supply chain network of applications, giving us and our healthcare customers the peace of mind and visibility of what is happening, where and when. Most importantly it is helping us achieve a high-level of customer satisfaction."
Richard Beeny, Co-founder and
Chief Executive Officer of LifeScience Logistics

About TECSYS

Founded in 1983, TECSYS is a market-leading provider of warehouse, transportation, and distribution management software and industry expert services to midsize and Fortune 1000 corporations in healthcare, third-party logistics, and general high-volume distribution industries. TECSYS has built its business through a single-minded focus on warehousing and distribution operations and by developing robust products and leading expertise over more than 25 years. The company employs a seasoned team of experts who have extensive experience in supply chain management and in deploying TECSYS' technology in high-volume distribution environments, enabling customers to significantly streamline logistics operations, and improve profitability and customer satisfaction.

With its recent introduction of Visual Logistics^TM, TECSYS customers are able to deliver visual cues, instructions, and images directly on warehouse workers' RF guns or handheld computers, enabling them to achieve significant increases in operational efficiency and unequivocal accuracy in order processing—and as a result, remove thousands of dollars in cost from their supply chain operations.

TECSYS Inc.

http://www.tecsys.com/
info@tecsys.com
1-800-922-8649
+1 514-866-0001
1 Place Alexis Nihon
Suite 800
Montreal, Quebec
Canada H3Z 3B8

Spotlight on Growing Your Company with SaaS
Thought Leadership from NetSuite

 

The Benefits of a Business Management Software Suite for High-growth and Midsized Businesses: Overcoming the Barriers of Stand-alone Business Applications

Fast-growing and middle-market companies are the lifeblood of the economy—in all regions of the world. But many of these companies today feel the need for a transfusion—the operational boost that can move them to a customer-focused business with the ability to grow even larger. These small and midsized businesses (called SMBs) have many of the same business requirements as large corporations; they may be smaller or employ fewer people, but they can have equally complex business processes.

Big businesses moved from home-grown legacy systems to a plethora of stand-alone applications (sometimes referred to in the past as "best of breed"), but by the end of the 1990s these big guys had consolidated on running the majority of their core business on one integrated platform, such as SAP's R/3, PeopleSoft, or Oracle applications. These integrated business applications proved invaluable in improved productivity and better business management, but they were also expensive, complex, and difficult to implement, manage, and support, with protracted deployments (sometimes years) that delayed a recognizable return on investment. For these reasons, small and midsized businesses avoided these large ERP suites like the proverbial plague; at the time, they were just too risky for these businesses to undertake. Despite repeated efforts from the big ERP vendors to capture the midmarket businesses, the SMBs simply weren't biting.

Unlike the Fortune 1000, today's SMBs are more likely to have a hodgepodge of software products in use in their business. These applications typically share common characteristics: the financial packages, usually the first procured, run on a stand-alone PC, and are the first to cause problems, as they cannot accommodate growth in transactions, cannot scale to accommodate more users, and have severe database limitations.

The second software package a midsized business buys is usually tied to the nature of the business itself—an application suitable to the vertical industry in which the business plays. And these two applications don't "talk" to each other. Additional applications—inventory or warehouse management, customer relationship management (CRM), time and expense (T&E) management, human resources (HR), etc., may be added—leaving the business with a disconnected slew of applications and—what's worse—the problems of manually entering and re-entering data across these multiple products. The ramifications include lost productivity in work hours spent re-entering data manually and attempting to consolidate data from the disparate systems; extremely high error rates, as manually entered data is highly prone to mistakes; lack of visibility to the information necessary to make decisions; and outgrown applications that cannot scale to allow the business to grow. The SMB is trapped by the limits of the very technology that was intended to help the company grow and thrive.

And unlike large companies, SMBs face the realities of smaller budgets, fewer IT resources, and zero tolerance for risk. They cannot withstand the long implementation timeframes or the cost of the ERP solutions that are the mainstay of large corporations.

The Advantages of the Integrated Suite for SMBs

Addressing the plethora of disconnected applications is the first step a fast-growing and midsized company can take to gain better control of its business operations and increase the efficiency of those operations. A single integrated suite of software—often referred to as an ERP or enterprise resource planning solution—provides significant advantages to the business, accommodating the breadth of the company's business processes, while providing the flexibility for even smaller companies to tailor the suites to meet their specific business needs.

Why do I care if my applications are integrated?

Today's technology solutions for the middle market and high-growth businesses have distinct advantages over their predecessors—both the large ERP products that were installed in the very big company and the stand-alone applications that were traditionally installed in the SMB. New advances in technology, namely SaaS and cloud computing technologies, bring midsized companies the benefits of a single business management suite without the cost, complexity, and rigidity of traditional software applications.

So let's look at these benefits. What does an integrated suite of business applications allow your business to achieve that a collection of stand-alone applications cannot?

1. Functionality. Organizations have access to all the core functionality required to run the business over time—at an affordable price point.
2. Scalability.Integrated suite solutions are designed to grow with your company. Stand-alone applications generally "top out" without transition paths to other solutions, leaving you to start over from scratch with a new and different application. An integrated suite provided as "software-as-a-service" (SaaS) (i.e., software hosted online) will allow seamless growth. You can add more users, more modules, increase your database size, and increase your volume of transactions as your business grows without business disruption.
3. Consistent data management.Stand-alone applications—sometimes referred to as "silos"—can't easily talk to one another. Thus, SMBs spend a great deal of time doing the same task reiteratively—entering the same data in different programs. There are some identifiable problems with this:
   • It is a waste of time to re-enter data over again.
   • It is very likely to be entered incorrectly.
   • It may look different in different programs. (Why do I have two companies in my vendor list—one is International Business Machines and one is IBM? Why do I have two versions of the same customer—Robert Smith and Bob Smith—with the same address?)
   • Data that results from very different disconnected applications is inconsistent, so attempts to analyze it yield the proverbial "apples and oranges"—a decision-support fruit salad.
   • Data isn't readily accessible—data in an integrated system can be accessed without effort spent trying to tie or consolidate the data together.
   • Lack of visibility into business information that crosses either departments or stand-alone applications.
   • Timely access to information. Because a SaaS system is "real-time" you get the information you want at your fingertips immediately.
4. Vendor management.Face it, managing a plethora of vendors with multiple 800-numbers for customer service is not easy. An integrated suite gives you one solution supplier to work with.
5. Reliable service and support.The ability to access affordable service and support is critical. It is easier to support an integrated ERP environment than a hodgepodge of different applications.
6. Clarity.With an integrated business management suite, there is a "single version of the truth" that only needs to be entered once to be propagated to all parts of the business that need it. All business processes, all employees who touch the application, and all the executives who make decisions for the company see the same version of reality, in real time, all the time.
7. Business process customization and automation.Only with an integrated business management suite can SMBs actually tailor the entire business processes that underpin how they conduct their business. Because workflow underlies the entire suite and not just fragmented parts of it, SMBs for the first time have tools to customize the solutions to work exactly how their businesses work—rather than having an application that dictates how the business has to be run.
8. Long-term cost of ownership when provided as SaaS.When an integrated suite is offered as SaaS—allowing businesses to subscribe to a service rather than purchase, install, and maintain an in-house software solution—companies can better forecast and manage their costs, and eliminate high internal IT support costs. Web-based delivery of business solutions proves the most economical in the long run as your business needs grow and change. Research shows that SaaS deployments are 50 to 90 percent faster with a total cost of ownership (TCO) 50 percent less than traditional software. Cost of ownership can be complex—as it includes far more than just the savings gleaned in original purchase and implementation. It also includes
   • the time, expense, and skill required to integrate the multiple applications, each and every time an application in the mix is upgraded or replaced;
   • the cost of potential disruption or downtime when the multiple products are upgraded or new revisions or releases are installed;
   • time and dollars spent upgrading software and ensuring integrated systems work properly together after each upgrade;
   • the very positive effects of increased productivity: faster order processing, rapid access to critical data by employees, increased ability to address customer issues immediately; instant data for upsell/reselling, returns management, as only a few of the many examples; and
   • the even more positive effects of timely, accurate billing with compliance to all revenue recognition requirements.

 

Is a modular ERP application any different than my current stand-alone applications today?
The beauty of an ERP application is that it is a suite that all works together—without this capability, you can't have seamless business processes. Modularity comes to play mainly in how you purchase and implement your ERP system. You may not need all applications at once, or you may want to deploy one application at a time. They are different from separate applications in that when more than one is implemented, they fit together like Legos and work automatically.

The Business Benefits of NetSuite

NetSuite is the number-one SaaS-based business management suite, with over 6,600 customers worldwide. NetSuite is designed specifically for the needs of the high growth and midsized business, providing one complete business management suite that allows you to manage all your back-office and front-office operations. It includes everything from accounting, to inventory and warehouse management, to shipping automation, CRM, and ecommerce.

Using NetSuite, your entire business—accounting, sales management, customer service, employee and partner management; and your own web stores maintenance—is integrated, so you can improve your productivity by streamlining operations and automating processes across the company. And because NetSuite is a SaaS solution, you have no costly hardware or software fees, no expensive integration of stand-alone products, or difficult upgrades to contend with.

Some of the key benefits you can gain from NetSuite:

 

1. Unified business processes across the enterprise

With a single, integrated platform for accounting/ERP, CRM, inventory management, and e-commerce, you can automate key business functions across all departments, including sales, marketing, service, finance, inventory, order fulfillment, purchasing, and employee management. Your employees no longer have to reenter data in different systems, rectify inconsistent or inaccurate data, or wait for batch updates. Instead, all your employees view and share accurate data in real time, leading to greater collaboration among departments and increased productivity across your business.

2. Increased visibility for better decision making

Customizable dashboards offer real-time access to key performance metrics, supporting intelligent, timely business decisions. In addition, full visibility into unified customer records results in more efficient and highly personalized sales, fulfillment, and service processes. NetSuite dashboards are role-based, providing "out-of-the-box" relevance to employees' individual job functions.

3. Ability to extend processes to customers, suppliers, and partners

Given today's need to work closely with partners through an extended enterprise, NetSuite offers self-service portals that enhance both business-to-business and business-to-consumer collaboration. In addition, proactive notification of partner-specific events accelerates process cycles and improves responsiveness, ensuring your position as a preferred partner.

4. Customization to address your specific business needs

NetSuite is the world's most customizable SaaS application. "Click not code" configuration and modular implementations jump-start your business on NetSuite. Advanced customization with simpler, industry standard tools allows you to tailor business practices and processes to meet your specific company and industry requirements. Because our customization carries forward seamlessly with upgrades, we actually encourage you to highly customize NetSuite to create your one-of-a-kind software application.

5. Support for your compliance goals

NetSuite includes audit trails that allow you to see changes that are made to data sets or business processes. Actions are "remembered" so you can always know what happened when and by whom.

6. Superior value with an affordable solution

Built from the ground up for growing and midsize businesses, NetSuite offers affordable pricing, accelerated implementation, and comprehensive support packages that result in unbeatable TCO. Plus, you eliminate the costly and time-consuming integration often associated with using a patchwork of disconnected systems. NetSuite also provides leading-edge professional services and educational programs that ensure efficient implementation and continued, long-term success.

Times have changed. Today's SMBs have access to integrated suites of business applications built for their particular business needs. While the business processes managed may be very sophisticated and complex, the solutions, with their integrated processes, simpler management, easy usability, and advanced business intelligence, are changing the way SMBs conduct their businesses with price points and deployment times far different than those encountered by large companies in the past.

 

What NetSuite Customers Say About the Value of Integrated Business Management

PeopleNet Communications Corporation: "We had very much followed the traditional approach to building our IT. We had Great Plains, we had Onyx, we used Crystal Reports, and we also had to use a lot of elbow grease to integrate those different applications," says Ron Konezny, COO and CFO of PeopleNet. The company spent 10 dollars in integration costs for every dollar spent on software, and much of that integration and maintenance came from the company's internal technology group, which was also expected to develop and support the company's core service offering. And in the end, the integrations were not as stable or powerful as the company needed.

Elcometer: Elcometer manufactures and distributes paint-and-surface inspection instruments for large companies in industries such as military, aerospace, automobile, and even furniture. The North America division, based in Detroit, Michigan, handles distribution and sales throughout the United States, Canada, and Mexico. The company was bogged down with client–server accounting software from Microsoft Great Plains. "The problem was that Microsoft Great Plains wasn't integrated well with CRM and shipping systems. With CRM, Microsoft basically bolted a knock-off of Goldmine," says Joe Walker, vice president of North America at Elcometer.

Elcometer's decision to go with a hosted solution instead of a client–server approach has saved the company loads of cash. Walker estimates a client–server solution would have cost a minimum of $50,000 for a server and $60,000 for a full-time IT manager, not to mention software license fees. "And I still would have had quadruple entries," he says. "I want to more than double my business over the next five years, and the only cost-effective way to do this is with NetSuite."

Cartridge World. "The first thing I noticed was the global visibility—NetSuite is certainly enabling the senior management team to have a consistent view of everything going on in our worldwide network," says Steven L. Yeffa, CFO. "It allows us to think, act, and work as a single company worldwide." In the process, the company has cut an estimated $200,000 in annual IT and administrative costs out of its requirements to run an accurate, sustainable business.

About NetSuite

NetSuite is the number-one SaaS-based business management suite, with over 6,600 customers worldwide. Since 1998, NetSuite has been designed specifically for the needs of the high-growth and midsized business, providing one complete Web-based business management suite that allows you to manage all your back-office and front-office operations.

NetSuite includes everything from accounting, to inventory and warehouse management, to shipping automation, CRM, and e-commerce. Using NetSuite, you can efficiently scale your growing company by streamlining operations, automating processes, and cutting costs, and make better smarter business decisions. And because NetSuite is a SaaS solution, you have no costly hardware or software fees, and no expensive integration of stand-alone products, or difficult upgrades to contend with.

NetSuite

http://www.netsuite.com/
info@netsuite.com
1 877 NETSUITE
+1 650-627-1000
2955 Campus Drive, Suite 100
San Mateo, California
94403-2511
USA

Case Study
NetSuite Success Story

 

Woodworking Machinery Maker Cuts Costs, Grows Efficiency with NetSuite

 

About Laguna Tools

Laguna Tools, based in Irvine, California (US), has been leading the industry in woodworking innovations for 26 years, and continues to challenge the industry with new advancements. Laguna Tools offers serious professionals and dedicated hobbyists alike the most extensive line of woodworking products on the market. Laguna Tools aims to be "globally local" by investing time, support, products and services into many community outreach programs.

Challenges

 

• Economic downturn was leading to increased competition.
• Fragmented IT systems were adding to business costs and slowed product shipments.
• Lack of visibility into lead generation was reducing marketing effectiveness.
• Existing systems were making it difficult to achieve goal of expanded online sales.
• Goal of reducing environmental impact and "going green" made it necessary to decrease use of paper and toner.

 

Solution

 

• Laguna replaced multivendor IT systems with NetSuite ERP, CRM, and Ecommerce
• NetSuite is now serving 24 NetSuite users with a customer base of 35,000 and more than 120,000 contracts.
• NetSuite Web intelligence links to customer records so Laguna can track online behavior.
• Online sales leads are now entered automatically into NetSuite to eliminate manual data entry.

"There's no comparison with our old system. NetSuite has helped us streamline our operations and become more profitable, and it has given us the ability to grow without any limitations."
-- Catherine Helshoj, Vice President
and Owner, Laguna Tools

Results

 

• Laguna is now saving nearly $90,000 annually in IT costs over the old system.
• Average order-to-shipment time has been cut from three days to two days.
• NetSuite is delivering 100 percent reliability, compared to the former system's average of two to three outages per month.
• Laguna boosts online sales with live inventory updates that take just 30 seconds, compared to 30 minutes with the old system.
• Managers can now modify prices instantly to take advantage of sudden market opportunities.

 

About NetSuite

NetSuite is the number-one SaaS-based business management suite, with over 6,600 customers worldwide. Since 1998, NetSuite has been designed specifically for the needs of the high-growth and midsized business, providing one complete Web-based business management suite that allows you to manage all your back-office and front-office operations.

NetSuite includes everything from accounting, to inventory and warehouse management, to shipping automation, CRM, and e-commerce. Using NetSuite, you can efficiently scale your growing company by streamlining operations, automating processes, and cutting costs, and make better smarter business decisions. And because NetSuite is a SaaS solution, you have no costly hardware or software fees, and no expensive integration of stand-alone products, or difficult upgrades to contend with.

NetSuite

http://www.netsuite.com/
info@netsuite.com
1 877 NETSUITE
+1 650-627-1000
2955 Campus Drive, Suite 100
San Mateo, California
94403-2511
USA

Case Study
NetSuite Success Story

 

NetSuite Helps Manufacturer Take Advantage of Fast Market Growth

 

About Digital Check

Digital Check is a provider of distributed-capture check scanners for branch automation and remote deposit capture applications. The Northfield, Illinois (US)-based company was selected for Bank Technology News' 2008 "Ten Technology Companies to Watch" for its innovative products, and has been listed as one of the publication's Top Innovators. Digital Check's TellerScan® and award-winning CheXpress® series of electronic scanners are cost-effective and provide high-quality images, and MICR accuracy and reliability. The company's scanners are available worldwide through a network of more than 70 authorized solutions providers, and are supported by Digital Check's comprehensive fulfillment, training, support, warranty, and repair services.

Challenge

 

• A fast-growing market for financial and point-of-sale check scanners and imaging systems challenged DigitalCheck to handle substantial new business.
• A multilocation business model with remote sales, service, and inventory was straining near-obsolete server-based IT systems.
• The company was using spreadsheets to handle order processing, inventory-tracking, customer case management, and other functions manually.
• Digital Check didn't have the time or staff resources to handle a burgeoning market, partially created by new US laws approving digital image transmissions for financial documents.
• Management wanted to improve service and support for top customer-resellers.
• The company wanted to consolidate fragmented systems, and create business-wide visibility into sales, inventory, and other functions.

"NetSuite has helped us become more efficient, more responsive to customers, and more profitable. And it's made us more self-aware – everything is visible now, and that's the only way to succeed when the market is growing so fast."
-- DigitalCheck

Solution

 

• QuickBooks, Sage, Exact Software, and spreadsheets were replaced with NetSuite ERP and Ecommerce.
• The NetSuite solution eliminated the need to maintain dedicated virtual private network (VPN) connections to remote users and offices.
• Digital Check was able to create an e-commerce site to sell inkjet cartridges, scanner cleaning supplies, and other scanner accessories directly, helping reduce costs to end-user customers.
• NetSuite dashboards give real-time, end-to-end visibility into important key performance indicators (KPIs) for sales, service, and other personnel.

 

Results

 

• The company grew approximately 350 percent in six years without adding staff.
• $300,000 annually is saved in maintenance costs over comparable server-based IT systems.
• Digital Check is able to improve customer service without adding new staff, saving approximately $150,000 annually.
• Improved case management reduced customer-call escalations by 62 percent.
• The company reduced open inventory by 54 percent as a result of integrated inventory tracking.
• Integrated electronic data interchange (EDI) processing has reduced order-processing time by 33 percent for one large customer.
• A customer portal gives top-tier customers visibility into orders, and eliminates the need for time-consuming phone calls and e-mails.
• An integrated shipping-FedEx module saves 30 hours a week of staff time for manual processing.
• The NetSuite solution helped the company improve from two-day order-processing to same-day shipping.

 

About NetSuite

NetSuite is the number-one SaaS-based business management suite, with over 6,600 customers worldwide. Since 1998, NetSuite has been designed specifically for the needs of the high-growth and midsized business, providing one complete Web-based business management suite that allows you to manage all your back-office and front-office operations.

NetSuite includes everything from accounting, to inventory and warehouse management, to shipping automation, CRM, and e-commerce. Using NetSuite, you can efficiently scale your growing company by streamlining operations, automating processes, and cutting costs, and make better smarter business decisions. And because NetSuite is a SaaS solution, you have no costly hardware or software fees, and no expensive integration of stand-alone products, or difficult upgrades to contend with.

NetSuite

http://www.netsuite.com/
info@netsuite.com
1 877 NETSUITE
+1 650-627-1000
2955 Campus Drive, Suite 100
San Mateo, California
94403-2511
USA

Spotlight on Distribution Centers
Thought Leadership from Bond International Software
Cloud Computing for Your Distribution Workforce

 

The Future of Your Workforce

Today's business buzz is all about cloud computing. With rapid progress in the HR technology sector, there are new ways to enhance productivity, while cutting costs substantially for the long term. Plugging into the cloud promises to eliminate the need for costly on-site servers, complex installed software, backup worries, and disruptive and expensive upgrades.

Cloud computing is currently the most sought-after technology for many industries, including warehousing and distribution. And for good reason.

Cloud Computing Explained

Cloud computing is Internet-based computing where shared software, resources, and information are accessed on demand by your Web browser and other Web-enabled devices such as cell phones. Simply put, cloud computing is a way to have all the benefits of a secure physical infrastructure, with none of the massive costs involved in setting up and maintaining servers and software. Following are just a few of the benefits:

Cost savings

No hardware to buy. No servers to maintain. No IT staff to pay. No back-ups to worry about.

Device and location independence

Access software anytime, anywhere using a Web browser.

Reliability

No more worrying about servers going down. For example, Bond Talent recruiting software is accessed from a state-of-the-art facility with dual power generators, multiple Internet feeds, redundant cooling, and world-class security.

Scalability

The ability to rapidly and inexpensively expand your business.

Maintenance

Upgrades are simple. With no software in your office, all updates are automatic.

Better cash flow

Cloud computing options are offered on an affordable monthly fee basis, which drastically reduces your up-front costs.

Few disagree that cloud computing is poised to make a big impact this decade. According to a survey by GlassHouse, a Framington, Massachusetts (US)-managed services consultancy, 60 out of 100 North American IT executives polled in December 2009 plan to implement cloud technology in 2010.

Cloud Computing and Your Workforce

Warehousing and distribution industries will find cloud computing especially useful due to the nature of their workforce challenges. Whether you are interviewing potential candidates, rescheduling your drivers, or assigning specialized workers, both time and money can be saved with no loss of productivity or data.

Firms "do not want to manage IT—they want to manage their business," explains Simon Piff, a practice director for enterprise infrastructure at IDC, a global IT market researcher. Ultimately, cloud computing is expected to transform a firm's IT spending from a capital expenditure to an operating expense—from up-front lump sums to monthly pay-peruser. As Piff states, "cash flow is king for most organizations." He goes on to say that today's restrictions on credit have forced companies to look for more cost-effective cloudbased software solutions.

HR software solutions such as Bond Talent (http://www.bondtalent-us.com/) provide a single database for integrated workforce planning, talent acquisition, and staffing supplier communications, utilizing the latest in cloud computing to streamline your workforce, regardless of size and geography. Cloud computing solutions such as Bond Talent can specifically provide the following benefits:

• Firms can better manage and share their distribution center workforce more efficiently 24/7 based upon centralized skill and availability data.
• Planners can quickly identify and correct workforce gaps in order to fulfill SLA agreements without jeopardizing profits or margins.
• Recruiters can be more responsive to hiring managers, more accurate in candidate skill matching, and more compliant with equipment certifications.
• Supervisors can more quickly collect, correct, and approve time sheets.
• Managers can better track distribution center daily performance metrics, hold employees more accountable, quickly reschedule their available workforce, and maximize overall productivity.

It's clear why cloud computing is being embraced by companies of all sizes. Its advantages of speed, ease of deployment, and low cost make it a viable option for firms looking to better their service without sacrificing quality. Since most ERP solutions are weak in their human capital management (HCM) areas of workforce planning, real-time scheduling, time collection, and skill matching, new cloud computing-based software solutions can be easily deployed to meet these important needs.

The Distribution Center of the Future Is Here

Thanks to the advent of Web-based on-demand applications that utilize the lower cost structure of cloud computing, combined with the much lower monthly billing of SaaS pricing, the world of HR software applications is about to make another dramatic change. As software environments have evolved from DOS to client-server to hosted ASP to Web-based and now to SaaS-based cloud computing, prices are set to drop by 50 percent once again.

Cloud computing is being hailed as the future of the virtual distribution center. What was unimaginable less than a decade ago is soon to be the standard. Taking this leap in technology today can ensure that your firm moves with the technological times, enhancing employee productivity and saving money in the long run.

About Bond International

Bond International Software and its 500 employees are experts in the development and delivery of recruitment and human capital management software solutions. Our software solutions are the preferred choice for recruiters and corporations by over 100,000 users in over 42 countries worldwide.

Bond Talent software is powerful and versatile , with features including Web-based applicant tracking specifically developed to enable corporations of any size to streamline their recruitment processes and save costs. Key features include an online application portal, applicant tracking tools, search facility, job board export, on-boarding, Outlook integration, agency portal, reports, multi-lingual as well as multi-currency capabilities, and above all flexibility.

Bond International Software

http://www.bondtalent-us.com/
info@BondTalent-US.com
1-800-762-4185
2051 Killebrew Dr., #520
Bloomington, Minnesota
55425
USA

Case Study
IBS Success Story

 

Konaflex Focuses on Its Core Business with IBS Distribution Management Software

 

Company profile

 

Company: Konaflex Oy
Region: Finland
Operation: Distribution
Products: Power transmission products
Employees: 25
Website: http://www.konaflex.fi

Headquartered just outside Helsinki, Konaflex Oy is a growing business that has seen revenue rising by 20 percent per annum over the past two years. With the help of the IBS distribution management software, the company has seen savings of about 15 to 20 percent of its total operating costs.

Konaflex distributes a wide range of mechanical and electromechanical power transmission equipment, as well as components and drives for engineering and other industries. These include couplings, clutches and brakes, drive units, and chain and belt drives. Konaflex also handles pipe connecting elements for water, sewage, and other pipelines, for both land and ship installations.

The recipe for the company's success has been to find the right components and get them to customers as quickly and reliably as possible. Serving a price-conscious and time-pressed client base requires tight integration of purchasing, inventory management, and sales.

For many small and medium-size businesses, IT operations too often translate into little more than e-mails and a Web site marketing their products or services. In contrast, for Konaflex, Web-based software is the main tool for its core business processes.

Hosted Solution

Konaflex has been a user of IBS distribution management software since 1996, with IBS Enterprise now delivered as a fully hosted solution. Users are able to access IBS Enterprise via their PCs using standard Web connections across a secure, fast, and reliable wide area network.

"If we look at the advantages for us of having IBS Enterprise fully hosted, supported and managed by IBS, the first thing that comes to mind is that we have no surprise costs," says Konaflex Commercial Manager Juha Leppänen. "Functioning in this online environment means that we always have the most up-to-date version of IBS Enterprise, ensuring we benefit from new enhancements as soon as they are available. This arrangement also keeps our staff skills up to date. When we started up, we had initial operations training, but now all we need is some occasional follow-up training. An IBS consultant comes to Konaflex, looks over how we are operating and using the software, and then might advise us on how our operations can be improved."

According to Leppänen, Web-based management of the supply chain has been a crucial component in Konaflex's growth, allowing for faster, more flexible, and more efficient operations, both at the office and in the field. "All our sales engineers really need is a laptop and an Internet connection. We have just supplied all of our sales representatives with new laptops so they can immediately check real-time inventory stocks, confirm orders, and serve customers on site, anywhere they happen to be."

"With the use of the IBS hosted solution, our savings are roughly equal to 15 to 20 percent of our total operating costs."
Juha Leppänen,
Commercial Manager, Konaflex

The Competitive Edge

Konaflex is one of the leaders in its field in Finland. This is no small achievement, considering the highly competitive nature of the electrical products business and the increasingly tough business environment. Finding and keeping that edge is a must, and Leppänen says that with IBS Enterprise, his company has found some crucial elements to gain and maintain the upper hand.

"A key feature in keeping us competitive is inventory management. Once upon a time it was a labor-intensive job. We've never had separate sales and purchasing staff. The fact that IBS Enterprise makes information available for someone handling both jobs is one reason we chose it. The system we have now eases our daily routine and allows us to react quickly in a sales situation. Nowadays, we are in the position that if we have it in stock, it sells—and if it's something that sells, we have it in stock. For the company to be a success, it is essential that we keep just the right amount and right kind of parts in stock, and get them out to customers fast, efficiently, and reliably. Spare parts go quickly and we do not have separate sales and purchasing staff. The salesperson handles both roles within our organization. It works for us."

Although Konaflex is not a manufacturer in the regular sense of the word, features of the IBS Enterprise Manufacturing module are an important part of its sales cycle. "Our salespeople use the module to register additional information about the product and the sale, automatically creating a production order. In this way, none of our internal management data needs to be inputted separately. Another time-saving feature is the manufacturing parts listing where the person processing the order can immediately see the number of parts available and their warehouse locations. Also, in this way, data on the workload factor of the orders shows up directly in the production planning feature," explains Juha Leppänen.

Focus on Achieving Targets

The pros and cons of accessing core business functions from a hosted IT infrastructure were carefully weighed within Konaflex before setting out along this path. The strategic decision was made early on to focus on what the company does best and to partner with an expert in IT services. By doing so, Konaflex has achieved its targets of more cost-efficient operations and more revenues.

"We don't want to tie up resources that are more productive elsewhere and can be directed into active sales. Actually, we've never had our own dedicated IT staff. In the early days I took care of what little automation and Web services we used. We've looked at this issue in detail and our estimate is that the IBS hosted solution is generating savings of around 15 to 20 percent of our total operating costs," concludes Konaflex Commercial Manager Juha Leppänen.

Issues

 

• Growing business
• Need for tight business integration
• No dedicated IT staff
• Tough business environment
• Inventory management too labor-intensive
• Need to reduce data input

 

Solution

Distribution software in a hosted environment with modules for:

• Sales order management software
• Distribution software
• Procurement software
• Inventory control software
• Warehouse management software
• Manufacturing software
• Financials software

 

Capabilities

 

• Flexible software delivery options
• Always using the latest version
• Staff skills up-to-date
• Sales reps online, anytime
• Sales and procurement handling by same staff
• Integrated manufacturing

 

Value

 

• Saving roughly 20 percent of total operating costs
• No surprise costs
• Faster and more efficient operation
• Better and more accurate productivity
• Increased competitive edge
• Increased turnover

 

About IBS

IBS is the world leader in distribution resource management software – business applications for the wholesale, distribution and manufacturer/distributor markets. We have over 30 years experience of helping wholesale and distribution companies streamline, automate and accelerate the processes needed to run their business. Through our software and services expertise, we deliver significant value to our customers by helping them improve their inventory planning, purchasing and supplier management, warehouse processes, demand management and returns processing.

IBS

http://www.ibs.net/ info@ibs.net +46-8-627 2300 IBS AB P.O. Box 1350 Hemvärnsgatan 8, SE-171 26 Solna, Sweden

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