In today’s post-modern ERP world, many emerging companies reject the monolithic “all-in-one” solution of the past. Instead, they’re opting for a best-of-breed cloud approach, which is now well-supported by current integration technologies. So, this popular approach no longer requires a large IT department (and budget). Consequently, it’s easier than ever for mid-sized companies to get exactly the functionality that they need to support all of their different departmental needs and tie it all together with integration tools.
In fact, this has become more and more of a trend with our fabless semiconductor customers. While we still offer a cloud financial/accounting solution with Tensoft SemiOps, we also deliver it to companies that already have a mid-tier cloud financial/accounting solution. Or, we have customers who want to use another cloud financial/accounting solution than the one that we re-sell (Microsoft Dynamics 365 Business Central). Or who want to roll out our solution in preparation for a ramp but want to hold off on upgrading from their third-tier accounting product for the time being. All of these approaches may be desirable, depending on circumstances, and we support them all.
While things often change quickly for emerging companies, some advance system planning can be extremely beneficial. At a bare minimum, I would strongly recommend keeping two things in mind: 1) the eventual integration between operations and finance; and, 2) your finance needs from your operations/manufacturing system. Both are important, and both require financial involvement from the start, even if manufacturing moves forward with a solution on their own.
Going a little deeper on the first point, it would be wise to review your financial system options related to the manufacturing system now, as well as the available integration with these systems. Be aware that “integration” may be used to describe anything from moving a few bits of data back and forth by a spreadsheet upload, to a robust, automated process. I would recommend that you define what you mean by integration in your requirements. For example, is it one version of truth; platform compatibility for consolidated reporting; robust auditable integration points; all of the above; or something else entirely? You will also want to understand the value of integration for your organization. In other words, how important are benefits such audit transparency, information velocity and accuracy, and personnel efficiency, to name a few? Given the extra work/expense that will be required to make separate systems function in your organization, is the perceived cost benefit of delaying some area(s) of functionality really worth it?
As for the second point, financial requirements are often ignored when finance and manufacturing functional groups proceed separately with systems. This is almost always a mistake. Manufacturing/operations/supply chain functionality usually includes sales operations support (sales orders, shipments, possibly invoices and credit management, bookings analysis) as well as inventory cost (inventory value change, inventory sub-ledger, margin analysis) and procurement management (payables, purchasing). Clearly, a significant amount of your financial input resides with your manufacturing system. Decisions made in isolation often lead to disappointing results. So, we have found that it’s best to work together from the start for a unified solution.
For more information about Tensoft’s products and services, please contact us. If you’d like to comment on this article, I encourage you to Tweet, post to Facebook or blog about it!