Why integrating your business is no longer optional
Integrating your business systems is often regarded as something on a ‘wish list’ – nice to think about, but not worth the time to implement. You can see the value of integration of course, but it has been optional – not really critical to your business.
Not anymore – as business picks up pace, and is ever-challenged by disruptive technology, integration isn’t just important to short-term profit margins, but absolutely key to medium-term strategy and planning. It’s the mechanism that will enable your business to remain competitive, continue to deliver on increasing customer expectations, and leverage new technologies. And it’s important to remember that even if the status quo is working well for you at the moment, it won’t for long – as your competitors achieve efficiencies through integration they’ll begin to make faster progress, have to deal with less admin, make better, faster decisions, fewer errors, and have happier customers with higher margins.
1. See what your business is really doing
In an un-integrated system, it takes a long time to collect
information from several databases, that change without reference to
the others, and double up information. Good business decision-making
relies on having an accurate picture of the current situation across
all departments – finance, sales, service, marketing and fulfilment
all have essential information to contribute. But, for most companies
it just takes too long to find, collect and analyse. By the time you
have the information you need, it’s very likely irrelevant, out of
date or it’s just plain wrong.
That’s why integration is so important – it lets you access that
crucial information instantly from a single point of truth, on any
device, wherever you are… rather than winging it because your current
IT environment just doesn’t have the analytics capability you need.
Integration means no more mucking around with data extraction and
reconciling conflicting sources, just clean, visible data that offers
better, more up-to-date information for quick and accurate
Halifax Vogel Group (HVG) is a diversified industrial products
distribution business. CEO Bruce Raument says integrating their
business with an ERP system gave staff access to timely information
and the benefits have been “enormous.”
“It enables us to manage our inventory better. We can analyse customers’ sales patterns, purchases, and product movements easily. It also allows our sales team to manipulate data, to judge it against various parameters like sales revenue, budget and gross profitability,” he says.
“It provides information that enables us to make better decisions
2. Give your IT team more valuable work
When a company has a whole raft of disparate and even conflicting applications, their IT team spends precious time trying to manage incompatible systems. Finding and installing new versions and updates also means more maintenance, and instead of making the business more efficient and productive, it’s just costing a whole lot more.
With an integrated system, your IT team won’t need to maintain multiple systems, or drop everything to revive legacy systems that crash unexpectedly. Instead, they can focus on improving business operating efficiency and solving real business challenges with technical solutions.
"With an integrated system, your IT team won’t need to maintain multiple systems, or drop everything to revive legacy systems that crash unexpectedly."
3. Easier, faster growth
A company that’s ready to expand into multiple locations or sales avenues, will find an integrated system makes such moves much faster and more efficient. Improved visibility means companies can cross-sell and up-sell to existing customers, as EasiYo has found.
EasiYo was hobbled by a legacy system that struggled to keep up with the business demand, and stunted company growth.
“With dairy prices spiralling world-wide, the need to constantly review margins, pricing and sales trends has become enormously important,” says David Granger, EasiYo General Manager.
With an integrated system, tasks have improved across the business. Company accounts that used to take three weeks to prepare are now generated in 10 days. Less time is spent on budgeting and reporting, and the financial team doesn’t waste resources on inaccurate paperwork. It also comes in handy when analysing sales data from across the world – distant consumers and the buying patterns of supermarkets on multiple continents. A job that once consumed an entire department is now completed by a simple tool designed to spot trends, anomalies and opportunities.
EasiYo staff can now compare performances, make educated predictions and critically analyse key business signs. As David Granger explains:
“We are now able to drill down to different levels of detail, that in the case of supermarket sales data, can throw up anomalies that their integrated ERP system makes sense of.”
4. Happier, more loyal customers
In the face of fierce competition, what can your company do to grow your customer base and raise your revenue? It’s no secret that providing the very best customer experience is key to getting, and keeping, your customers. A customer who can’t get an issue resolved quickly, or who keeps finding that the product they want from you is out of stock – it’s that customer who will be off to your competitor.
Customer experience is improved by connecting ordered volumes with stock levels, providing your sales team with instant access to up-to-date availability, delivery times and customer accounts. Even just having to repeat their issue to a second person on the phone can feel arduous, so it’s crucial to be able to solve their problems quickly and efficiently. When customers can be assured that an item is available, and it’s delivered on time, that customer’s good experience translates to increased revenue.
Griffiths Equipment credits their ERP for their competitive edge in the supply of automotive products. Griffiths can fulfil customer orders with efficiency and accuracy, and saves the company time and money through innovative inventory management processes. New goods are placed according to size or popularity, a wireless network in the warehouse runs hand-held picking devices, which also maps routes and speeds up finding products.
Managing Director Peter Griffiths estimates that the new scanners, backed by their integrated system, cut errors by up to 80% in the first month.
“Our business is a leader in the field because we’re nimble on our
feet,” he says.
5. What your current system could be costing you
Because implementing an integrated ERP can seem like a big outlay, it pays to really look at what your old system is costing you. Think about the expense of administration time, and of the multiple human errors that your company suffers.
Look for gaps in your system – is your company floundering because things aren’t well connected? Do processes or data overlap, or do things fall through the cracks? Examine each department and process to see where the disconnects are. Ask your teams to record time lost due to double handling of information. Dealing with it more anecdotally can help too – ask the relevant stakeholders to estimate the time spent searching for information through various systems, or any time spent correcting an error caused by incorrect or out of date information.
Next, calculate the cost of each of those disconnects, based on hourly rates, missed opportunities and hard costs.
Count the opportunities for profit and growth
There are a number of ways an integrated system can enhance your company, beyond making your processes more efficient – timely, accurate information will also improve your marketing, enable more competitive pricing and speed up delivery-to-market of new products. This is because your sales, product and marketing teams can work with real data, rather than running on gut instinct. It means marketing dollars are more targeted, you can hit that pricing sweet spot faster and reduce trial and error in new product design. All of this translates to increased sales, better profit margins and enhanced customer experience.
While these benefits are much harder to quantify, they deliver the true value of a seamlessly integrated business, paving the way for growth, profit, and a pathway to securing greater market share.
"Next, calculate the cost of each of those disconnects, based on hourly rates, missed opportunities and hard costs."
6. Integrate and thrive – or get left behind
Integrating your company isn’t just an option anymore – it’s a business necessity that shouldn’t be put off. The exact figures vary from business to business, but the reality is an integrated organisation is a more efficient one – one that makes more money, stays ahead of the game, and is one step in front of competitors.
With integration, you equip your business to operate with the
nimbleness and speed of a start-up, while improving the systematic,
thoughtful, risk-reducing decision-making more often seen in
corporates. Your staff will be happier, your customers more loyal, and
your margins will continue to grow.