Unified managing

Written by Danny Bradbury

John Vavitsas remembers what a logistical headache it used to be to open a new branch of his janitorial firm. The CEO of Toronto-based Clean-Mark Group Inc. says data flows between new locations and head office were so cumbersome and error-prone they became a major drag on expansion.

Each new office would have to get up to speed on a range of separate software applications to handle functions such as accounting, order processing and paying local subcontractors. It would then have to send masses of data to Toronto to be rekeyed into spreadsheets for analysis. Mistakes were common, and the process so slow it left Vavitsas making decisions with increasingly outdated information. “We had that happen to the point where it was impossible for us to have monthly financial statements,” he says. “We were lucky if we could do it quarterly.”

All that changed two years ago, when Clean-Mark adopted an integrated business platform (IBP) called NetSuite. The Web-based suite of software applications gives Vavitsas a big-picture, real-time view of his entire operation instead of the bits and pieces he relied on before. He says this allowed Clean-Mark to expand into California, Atlantic Canada, Quebec and the southern and midwestern U.S. far more quickly than it otherwise could have, such as opening in the first three regions in 90 days. As well as saving 20 hours a month in reporting time himself, “we were able to eliminate clerical positions, which saves over $80,000 per year,” says Vavitsas. “And I’ve relieved my clerical staff of hundreds of hours each year by not having to ask them to research data that’s now available to me daily.”

Unlike Clean-Mark, most firms still operate using data spread across various applications. That makes it tough for a CEO to get a sense of the current overall state of the business, or how changes in one function will affect the rest. But Vavitsas is one of a fast-growing number of entrepreneurs who use an IBP to integrate data automatically from across the company. This all-in-one management tool combines continuous updates on key indicators with an ability to burrow into the details to spot opportunities.

With more than 7,000 clients worldwide, San Mateo, Calif.-based NetSuite is the leading IBP provider to SMEs, its sole market. Its platform presents data on a Web page that, like a car dashboard, uses dials and gauges to display the vital information you need to drive. But, unlike in a car, you can choose which indicators to display from a menu of about 50—including new sales leads, inventory turnover, payables or overdue shipments—or ones you design yourself.

NetSuite lets you decide which types of data to grant each executive. You could customize your marketing manager’s dashboard so she instantly sees whenever a product is overstocked. She could then drill down to find previous purchasers of that item who haven’t bought it lately and send them a special offer in an e-blast.

Vavitsas offers an example of the power an IBP gives him to identify and jump on opportunities. He says he might click on the gauge showing this week’s new sales leads at 10 a.m. Toronto time and see that one of his sales reps in Redwood City, Calif. plans to pitch janitorial services to a Lexus dealer there. In his customer list, he might see that, unknown to his California rep, Clean-Mark already services a Lexus dealer in Toronto. After clicking on that client’s record to verify that its payments are up to date, Vavitsas could call the Toronto dealer to request a reference, then e-mail his California rep with that name and number—all before California opens for business that day.

The basic NetSuite Small Business package costs $120 per month for the first licence and $60 each beyond that. The higher-end version, simply called NetSuite, makes it possible to sell more products on the e-commerce site that’s part of the service, permits more marketing e-blasts per year and provides more personal productivity tools such as contact and calendar management. It costs $599 per month for the first seat and $120 each thereafter.

Most users customize the platform to fit their business processes. NetSuite offers a free add-on called NetFlex that lets customers change the look of Web forms and write their own software code if they wish. You might configure it so that whenever anyone places an order on your e-commerce site above a set threshold, the system will e-mail your warehouse to check that it has enough inventory to fill the order. Unless you have a software developer or analyst on staff, you’ll want outside help for that. Businesses generally take 12 to 16 weeks to customize the software, often working with NetSuite’s experts.

An IBP is not the answer for everyone. It won’t do you much good unless your staff consistently enters the data you’ll need to make management decisions. And the smaller your business, the less pressing it is to integrate data flows. This explains software giant SAP’s decision to target its IBP, Business One, to firms with at least $5 million in revenue. (While NetSuite was designed from the ground up for SMEs, SAP scaled down software originally crafted for giant corporations.) As Jeffrey Watts, senior vice-president of channels and marketing at Toronto-based SAP Canada Inc., puts it: “When you’re in a small company and can look across the desk at the person doing the order-taking and processing, your need for integration, while important, doesn’t drive the business.”

Still, even a small firm might find it hard to manage the sheer volume of data across different applications. That’s why Jeff Binder went integrated right from Day 1 at Saffron Rouge Inc., a Guelph, Ont.-based online retailer of organic cosmetics with 12 staff. NetSuite meshed his website and back-office operations right out of the box, saving the significant time and expense of custom integration of the applications. This makes order fulfillment, a critical function in e-commerce, run far more smoothly.

The instant someone clicks “submit” on Saffron Rouge’s website to order, say, 10 tubes of organic lipstick, NetSuite logs the order in the warehouse manager’s online shipment queue, accessible via the website. It e-mails the customer an invoice and enters the order in the shipment queue. The order is linked to the customer’s profile, so the marketing manager can use the data down the road to tailor promotions to that client. Back at his desk, Binder can keep tabs on e-commerce orders using one dashboard gauge, while on another he checks month-over-month revenue trends.

Binder says such logistical efficiencies have eased growth. “We wanted to expand into the U.S. when we started the firm. Six months later, we did it,” he says. “We manage two warehouses and could not have done it without NetSuite.” The firm wanted a single integrated e-commerce site that could automatically check inventory at both its Canadian and U.S. warehouses. “We have that now,” he says.

Binder contends such rapid growth is harder to manage without an IBP. He says unintegrated data makes it harder for head office to know what the other offices are doing, and for each office to run its business processes smoothly.

When it comes to the data for running your firm, says Binder, the sooner you integrate it, the better placed you’ll be to manage your long-term growth. “It’s like choosing a spouse,” he says. “You want to make sure you get someone you can really live with and go in the direction you want to go. It’s the same with software. When you choose a business system, you just married yourself to it.”

User’s guide: integrated business platforms

» Avoid analysis paralysis: An IBP’s “dashboard”—a Web page displaying the state of your firm—can be hypnotic. Figure out which key indicators are truly crucial so you don’t deluge yourself with dozens of irrelevant dials and gauges.

» Geeks outside, suits inside: Hire outside technical help if you need to carry out extensive customization, but get your key managers involved so the results will suit your business model.

» Staff up to cash in: Don’t deploy an integrated platform without also investing in employees with the experience to capitalize on the growth opportunities it offers.

» Always have a backup: NetSuite guarantees that its service will be up 99.5% of the time, which leaves 44 hours per year when it might not be. You’ll need a contingency plan for short-term outages, plus a backup Internet connection.

» Get employee buy-in: Integrated platforms are only as good as the data that flows into them. Make sure your staff understand the need to support the IBP by systematically entering everything.

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