This FREE webinar sponsored by Epicor will explain what you should consider before moving your data to the cloud.
Presenter Jeff Gusdorf, Brown Smith & Wallace
Presenter Tony Corley, senior product marketing manager - Distribution, Epicor
Host Rich Vurva, Industrial Supply magazine
While ERP software in the cloud has been around for more than a decade, adoption rates are increasing for distributors. This is largely driven by the need to provide exceptional customer service to remain competitive. This webinar will discuss the changing landscape and suggest things you should think about before moving to the cloud.
Webinar: It’s a Good Time to be in the Cloud May 22, 2 p.m. EST
You’ve
been running your distribution business on the same software for more
than a decade. It paid for itself years ago and still performs the same
basic functions it did when you logged in that very first time. You have
every reason to feel proud of making a sound technology investment way
back when.
What others — including your employees and customers — might not tell
you, however, is that this same software could be slowly, inexorably
strangling the life out of your business.
I recently spoke with a wholesaler who was a “power user” of one
of our legacy enterprise resource planning (ERP) platforms dating back
to the mid-1980s. He admitted that his software had outlived its purpose
as far back as 2002. He finally upgraded to a powerful, modern solution
in 2014. So, what happened during the intervening years? “We coasted,
and it hurt us,” he said. “I knew I needed to make a change, but kept
coming up with reasons to wait till next year.”
What this business owner would tell you today is that had he replaced
his old software even four years earlier, it already would have paid
for itself multiple times through increased efficiency, reduced labor
and inventory expenses and improved customer satisfaction.
“It’s always easy to put off an important decision until next month
or next year — especially when it involves a financial investment,” he
said. “But the worst thing you can do is convince yourself that
indecision doesn’t carry a price of its own. And that price can be very
high.”
This business owner saw firsthand what he had been missing simply by
observing his employees, who were now “willing to explore new ways to
service our customers.” With the old system, they had a limited ability
to capture important information on customer buying patterns. They were
spending hours each day on price maintenance rather than focusing on
building sales. They couldn’t analyze their business performance beyond a
few canned reports.
With the new software, however, all of this changed. “I suddenly saw
long-time employees who were re-energized and who had confidence that
they could attack problems in new, more efficient ways. It was like they
had been waiting for me to give them these tools for several years. How
do you assign a value to that?”
Impact Throughout The Business
Unlike transaction-based legacy systems, unlimited access to your
business data in a modern, open database environment can give employees
the ability to analyze, providing real-time information to make better
decisions and call out exceptions. This can lead to improved customer
service and growth.
As employees accomplish more in their daily tasks, customers will see
faster responses and more accurate service. For example, collaborative
order entry reinforces customer confidence and prevents expensive errors
from incorrect material orders and deliveries.
Likewise, mobility in more modern ERP systems can extend the
application to workers outside of the office (e.g., giving the sales
team data connectivity on the road to update order status). According to
one distributor, “In an environment where everyone expects information now,
I believe mobility with our ERP system gives our sales team access to
the data needed to meet those expectations. We also receive real-time
information that allows us to review open quotes, outstanding A/R, etc.
to address while making a call to an account. In short, it allows us to
work smarter, faster and with the most up-to-date data.”
Modern systems can also offer other sophisticated functionality that
is important to HVAC and plumbing distributors, such as volume rebate
tracking, customer-facing order entry, front counter capabilities,
document imaging, job-based pricing, assemblies, disassemblies and
modifications. For example, job-based pricing provides the ability to
quote a job and store those prices for the material in a contract, so
that the prices are guaranteed throughout the job.
Enabling Sales and Profits
Bob Dylan wrote, “If you’re not busy being born, you’re busy dying.”
The same seems to be true in the context of operating a distribution
business. The wholesalers who are most energized and, often, most
successful, are the ones who understand that technology is a sales and
profit enabler, not a cost center. They are continually looking for ways
to harvest additional competitive value from their systems, and when
those systems have been maxed out, they carefully select a new system
with proven potential to drive their growth for the next several years.
Conversely, there are businesses that continue to rely on an outdated
solution simply for the reason that it still turns on every morning.
It’s no wonder that many of these business owners are working harder
than ever just to maintain some semblance of the sales and profitability
they enjoyed 10 years ago.
Which
are you? A business owner committed to aggressive growth and to
attracting and retaining high-energy employees who look forward to
coming to work each day? Or are you experiencing a steady erosion of
your business as customers move to competitors?
If you’re the former, I congratulate you on your willingness to seek
continuous improvement through leading edge technologies. If you’re the
latter, I urge you to make the investment you’ve been postponing for so
long. Haven’t you already paid too high a price?
Over the next 14 months, 80 percent of IT
budgets at organizations throughout the U.S. will go to cloud computing
services, according to a new global study from Intel Security. As
sensitive data is moved to the cloud, it is becoming more obvious that
the cloud still has its risks. According to the study, only 13 percent
of IT security professionals completely trust public cloud providers to
secure sensitive data, and 66 percent of them believe senior management
does not completely understand the risks of storing sensitive data in
the cloud.
When
assumptions are made about cloud security, some risks are overlooked.
Organizations need to be aware that encryption and redundancy are not
enabled by default in the cloud, and access to cloud resources still
needs to be managed.
The
biggest infrastructure-as-a-service (IaaS) cloud is Amazon Web Services
(AWS), which hosts big hitters like Netflix, Expedia and Adobe. Other
players like Microsoft’s Azure and Rackspace are also great solutions
and are catching up, especially among small and medium-sized
organizations, but AWS’s documentation is easier to follow and better
organized.
Bill Gogel is an IT Audit Manager at Brown Smith Wallace, where he
is responsible for providing internal and IT audit and IT consulting
services to a range of industries, including technology,
telecommunications, manufacturing, health care, government and financial
services. He has experience providing ongoing PCI consulting and IT
auditing services.
