The study and documentation of current business activities and flows with the goal of streamlining, improving performance, reducing redundant data entry, plus integrating redundant and competing systems to increase sales and reduce costs.
A broad buzzword that generally means your application is stored and maintained by another company like Amazon, Microsoft, Google, Hoster, or another data center. All you generally need to access it is a web browser.
This application tracks the costs and success rates of marketing campaigns; activities and performance of each salesperson; pipeline management; and customer cases, warranty issues, and complaints. Quotes created in CRM flow to invoicing. CRM is a subset of the ERP system. You can own a CRM system that is not part of your accounting system, but the goal is to have one integrated system, one source of the truth, one ERP system. Many businesses will buy a CRM system and a financial system from different software companies and then spend tens if not hundreds of thousands of dollars to integrate them. In AccuNet’s experience, those companies that selected one integrated system have higher success rates and lower operating costs.
Ecommerce, a shopping cart or website like Amazon for your products and services, is an unpaid sales person and marketing resource that works 24/7/365 for your business. Ecommerce is a way for customers to research and price your products without talking to a salesperson, which is what 70% of customers want. A good ecommerce site will have more than just a product list. It will have features, specs, warranty info, pictures, videos, customer references, documentation, reviews and expert analysis. A good ecommerce platform makes it easy for customers to buy from you when they want to, when they have time, which is probably not 8 AM to 5 PM.
This agreement is on all software and you have probably agreed to many already. On mobile and web apps, you often have an option to read a long legal agreement or just accept. As many Facebook and Google users have discovered when you accept the EULA for a free app, you may be giving the app the ability to view and use your pictures, access your connections, viewing history, purchases, etc. The EULA needs scrutiny and a VAR adds value here by pointing out terms and conditions that influence your specific business. The EULA generally tells you what you can and cannot do with the software. For example, you cannot sell your software to another business unless you are selling it with all the assets of your entire company. You cannot make copies of the software and give it to someone else. You cannot reverse engineer the code and sell that to someone else. In general, it protects the publisher, but it also tells you want you can do with licensing and use of the application.
This term refers to an accounting system that is doing more than GL, AP and AR. An ERP system is managing most of the processes required to run the business. Common additions to accounting systems to make them into ERP is to add CRM for sales and marketing, won deals turn into invoices or projects and flow into AR and GL. Manufacturing businesses add MRP to requisition, purchase materials, forecast labor, and plan production to build inventory items that have already been quoted, ordered, or forecasted. In project businesses they often have bid or estimating systems that work with sales and accounting. Labs have testing and reports that feed a project and billing. The systems are often very specific to that business, but integrated, and tend to flow from initial customer contact all the way to the financials. Professional services firms often add project costing with time and expense tracking, requisitions, contract and billing rules, and invoice formats per contract or customer. Increasingly popular is to have an e-commerce site or web portal so customers can self-serve, create quotes, check inventory levels or order status, or enter a support issue. The key word is enterprise – if your accounting system is in use beyond the four walls of the accounting department, you have an ERP system.
On-premises purchased software but the servers, internet, and physical space are provided by a data center. Data centers offer services like redundant high speed internet, power backup, security, service level agreements, clean, cool rooms, and other services for businesses who want to outsource their IT and servers.
Licensing options are the rules for how users get to the application and what you pay for it. Here is a list of questions you can ask concerning how the publisher’s licensing rules will affect your business:
- Can I license in the cloud, on-premises, or in a data center of my choosing, and can I change from one to the other if my business need changes?
- Who owns my data?
- Can I get a database backup to store in the safe place of my choosing?
- Do I pay per user, per concurrent user, or unlimited?
- Do I pay different rates for an employee doing a time card than I do for an employee doing AP all day?
- Do I have transaction volumes levels?
- Do I have storage levels?
- Can I get a test system for training and development?
- How are upgrades deployed, how often do I have to upgrade, and can I determine the timing?
- If I am paying for the software monthly, how often and how much can the price change?
- Can I reduce users if my business shrinks, and how much will users cost if I grow?
A subset of ERP that only includes the manufacturing features: inventory, bill of materials, work orders, and production are all part of the MRP subset while financials, CRM, AP, and AR are not included.
Often refers to accounting ledgers like GL (general ledger), AR (accounts receivable), AP (accounts payable), project, inventory control, and purchasing. Some publishers call each module a granule and some publishers group modules together into suites. For example, inventory, order management, and purchasing would be a distribution suite.
Refers to anything on your local network, and for our purposes here, specifically publisher software installed locally on your business network and hardware. On-premises, sometimes shortened to on-prem, is a capital purchase with an annual maintenance fee that provides upgrades and fixes. The upgrade service is an extra fee and generally performed by a VAR. On-prem is the way most business applications were installed in the 1980s through 2010.
A secure credit card certification. Since credit card use is increasingly popular, fraud is going up, and compliance is tougher. You should demand PCI compliance built into your ERP system. If your business takes credit cards, you have to be PCI compliant. In essence, none of your employees handle credit card information, only a token or the last four digits are visible. The credit card processing is outsourced, and your business never sees or stores the complete credit card information.
This is another subset of ERP for project-focused businesses. A PSA business collects time, expenses, and purchases against a project for costing, management and billing to a customer. In a professional services company the CRM system tracks project proposals that create a project and budget when approved, release the project for consultants to enter time & expenses, and bills that time to the customer on a regular cycle. Project managers can see utilization, estimate to complete, burn rate, approve change orders, and manage resources. All the project information rolls up to AP, AR, and the GL for financial reports. It encompasses the enterprise in one software solution.
The creator of the software. Companies like Microsoft with Dynamics, Acumatica with Acumatica, Oracle with NetSuite, Sage with Sage Series, and Intuit with QuickBooks. The publisher develops updates and improves the software and sometimes even sells and supports the software. The most common model is to use a local VAR to sell and implement the publisher’s product.
This agreement typically comes with cloud-based software. It states a guarantee on uptime (how much of the time you can access your application) and what will happen if the publisher does not meet that uptime. It is typical to see uptime in the 99.8% range. If a publisher does not meet the uptime agreement, they will often refund a portion of your monthly fee, and that portion grows exponentially as uptime decreases. As an example you may get 5% back if they fall below 99.8%, 20% back if they fall below 99%, and 50% back if they fall below 95%.
Note: the SLA, warranty, and EULA define the legal agreement between your company and the publisher. Together, these documents should be reviewed with your lawyer, management, and your VAR. Publishers will resist any change to these agreements, but a well-defined argument will often win as a condition of sale. You may often find that the publisher will not agree to the change, but your VAR can add terms to their implementation agreement that will meet the company’s concerns. It is a combination of the publisher’s agreements and your agreement with the implementation partner (VAR) that give you total coverage.
In essence, this is renting software, not owning it. In the past, a business would buy a CRM system for $20,000* for eight people and pay 20%* annually for the updates. The business would also pay for servers and internal IT to support the software, plus pay consultants to upgrade the software every two or three years. Today many businesses elect to rent the software for $75* per person per month. The SaaS license comes with the servers, installation, upgrades, and related IT support. The customer only needs an internet connection to get to the software. The key hidden cost is internal IT. Most businesses have swamped IT departments and their importance to business growth is increasing. If the SaaS model enables the business to avoid adding head count to internal IT or allows IT to focus on key company goals, SaaS is often a bargain.
*These are example amounts for illustration only
SQL is a database language. The underlying database is the electronic filing cabinet that stores all your financial and customer information. There are many software publishers that produce a SQL database, including Oracle, Microsoft, My SQL, Sybase, and MongoDB. Oracle is most popular with Fortune 1000 companies, and Microsoft SQL or MS SQL is most prevalent with the rest of the market. Oracle requires a person or team to manage it, called a DBA (Database Administrator). The DBA monitors the size, speed, indexes, and backups. The DBA tunes and optimizes the database for best performance. Oracle is behind some of the biggest databases in the world, and it comes with an overhead that most businesses cannot afford. Microsoft SQL is self-managing. Once installed it will expand, re-index, and back itself up as instructed. It is an install-it-and-forget-it database. It is economical and the standard for most of the business world.
Groups of modules and features for a line of business. A financial suite will often contain GL, AR, AP, bank rec, and financial reporting. A distribution suite will contain inventory, purchasing, and order management. Suites often are a better value than individual module purchases.
This is generally what AccuNet is. We work with software publishers like Microsoft, Acumatica, and others to become experts in the product and learn how to configure, customize, and create reports so we can match client requirements with software features and successfully deploy these products.
This document tells you what the publisher will do for you. It addresses how often updates are released, how new versions are released, how the publisher will fix bugs, and any guarantees on performance. This is an important document, and your VAR can point out cases that are important to your specific business.
A secure way for computer programs to exchange information over the internet. Web services are an essential feature for modern ERP systems. Web services are the data exchange tools for credit card authorization to make credit card processing PCI compliant. Web services shop shipping rates between UPS, USPS, FedEx and other carriers. Web services are used for currency rates, local tax rates, and to get signatures from customers on contracts with a digital signature. New web services are coming out every day and are critical to making your ERP system efficient and competitive.