Business Practice Reviews

Implementing a new ERP system is opportunity to review and improve business practices throughout all levels of your organization.

Migrating to a new Microsoft Dynamics GP ERP system is a significant project for any company but it can also be an opportunity to review your business practices.  It is the perfect chance to change anything from your General Ledger account number structure, how you pay your vendors, item numbering and warehousing organization to the way you generate sales documents or pay commissions.  Although most every company has some unique aspects to the way they do business, sometimes a “unique” process is unique because “it’s the way we’ve always done it”.  Sometimes this is a result of setting up a process for a prior system and, without review, a company may continue to use the same old process in subsequent systems.

A particular example from my past is when we were implementing a new system which we considered a whole company improvement project and not necessarily limited to the new system.  We spent significant time reviewing those processes that we considered unique to our company/industry.  We were migrating from a custom system that was built around whatever processes were in place when it was created.  One issue that wasn’t specifically addressed in our new system was the selling of gas with a returnable core (container).  We debated about if it was one item or two (gas vs core) and I believe someone even tried to make a case for three items.  Was it a kit?   Was it gas with a core deposit?  In the end, we decided there were two separate sales transactions and two separate items – the sale of gas + core and the return of the core alone.  The transactions were much simpler than the process we had been using previously and we improved the process for tracking empty cores and returning them to our vendor. 

It seems simple now but we had to break the problem down and consider all of the variations to the process to see that we had previously been using an overly-complicated procedure without thinking about it.  The discussions allowed me to explain the accounting considerations while I learned more about the sales and inventory procedures and problems.

Tips:

• Ideally, get representatives – including management – from other departments in your company to be involved in these discussions and decisions.  You may not know what some of their issues are and their involvement will help them feel some ownership of the process and understand the decisions that are made.
• Discuss problems with your clerical staff.  They know best what some of the problems are but they may never bring it up because they think it’s just the way it’s done.
• “Map” every process to Dynamics GP to make sure you have a procedure to deal with each situation in the new system.
• Try creating and processing a sales document in Dynamics GP with every one of the worst possible scenarios included – the most complicated inventory items, the most complicated customer, etc.
• Support from your company management is critical for your successful implementation.

Every system is different and the more you can work with your new system, the more efficient your processes will be and you may be able to improve other segments of your business at the same time.

Your TMC consultant is a trained and experienced accounting professional.  They’ve seen how companies from many industries deal with problems and they can help you, as well.

Tags: Business Practice, Dynamics GP, ERP, General Ledger

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