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Quality Management Processes in Microsoft Dynamics AX

Microsoft Dynamics AX 2012 provides a number of quality management processes that you can use to ensure a high level of product quality within your supply chain. This capability leads to optimized supply chain processes and higher customer satisfaction.

Quality management functionality in Microsoft Dynamics AX can help you manage turnaround times when dealing with nonconforming products, regardless of their point of origin. By linking diagnostic results to correction tasks, the system can schedule tasks to correct problems and therefore help prevent recurrences in the future.

In addition to nonconformance management, quality management functionality includes the ability to track issues by problem type (including internal problems) and to identify solutions as being short-term or long-term. Statistics on Key Performance Indicators (KPI) provide a window into nonconformance problems that have occurred historically and the solutions that have been applied to correct them. Historical data can be used to help review the effectiveness of quality measures that have been taken and to determine appropriate measures to perform in the future.

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Top 5 Benefits of Global ERP Systems and Processes

Organizations that have multiple sites and global operations face significant challenges to efficiency and growth. Disparate business systems, lack of supply chain visibility and control, and high IT maintenance costs hold companies back and make it difficult to support new growth initiatives.

All businesses at one time or another have to weigh the costs and benefits of retaining an older ERP system (or systems) against the costs and benefits of selecting and implementing a new one. Legacy systems, although on older technology, provide companies a level of comfort - comfort that is likely at the sacrifice of increased efficiency, visibility, and growth.

Below are the top five benefits our clients experience when implementing global ERP systems and processes:

  • Single Business Management System: Global organizations need a way to move out of silos of data and systems, especially considering the vast differences in geography and culture, and operate with the best processes and people working together across locations. Globally adopted systems allow a business to break down these cultural and geographic barriers and get people working together in an efficient manner.
  • Global Adoption of Best Practices: A global ERP solution helps companies optimize and standardize business processes while encouraging the adoption of best practices throughout the organization. Streamlined processes lead to better performance and more efficient people. Globally adopted best practices also supports cost-effective expansion, enabling organizations to use company-wide standards, templates, and best practices to "cookie-cut" new locations, regardless of geography.
  • Faster Financial Reporting: The ability to more quickly close the books and provide much more timely financial results to corporate management is a great benefit to global organizations. Global ERP solutions provide much greater visibility to individual global entities and the ability to view the entire enterprise with multiple currencies and multiple locations; this positions organizations to quickly grow and expand as the market dictates.
  • Compliance and Risk Management: Global visibility and control of compliance-related processes and activities are key factors in enforcing effective compliance and risk management practices. A Global ERP solution can enable your organization to streamline and comply with a variety of global and local compliance requirements and customer mandates, including financial, legal, and environmental. By utilizing a single solution for policies and procedures, process documents, database logs, reports, charts, and key risk indicators, global organizations can see the whole picture, take control of processes, mitigate risks, and ultimately reduce the cost of compliance.
  • Reduced Operating Costs: Organizations that successfully adopt global systems and processes see reduced operating costs in a number of areas. With a single global ERP system, companies benefit from reduced IT costs, including staff, support, infrastructure, and applications. Standardized processes also enable organizations to continuously improve efficiency, productivity, and decision making - enabling volumes to increase without needing an equal increase in operating costs.

Learn more about how a Global ERP system and standardized business processes can help your organization successfully move into new markets while maintaining visibility into overall operations, optimizing value chains, and simplifying IT environments: Global ERP Implementation Partner

Bad Processes Forced by ERP System?

We recently asked the CEO of a large multinational organization why they were changing their ERP system. “To improve our business processes,” he replied, stating one of the most widespread drivers companies have to change their ERP systems. As you evaluate your ERP system with regard to business processes you should first assess the level to which any bad business processes are forced on you by your ERP system; and then identify the number of disparate and sidebar systems users have created to work around your ERP. If you find significant process issues in these areas, a change to a modern ERP system that can help you differentiate your business may be beneficial to your organization.

The functionality and capabilities inherent in your ERP software have a big impact on your business processes. As you assess the effectiveness of your current system, you must first review your core business processes to determine if they enable maximum efficiency and productivity. If they do not, investigate whether the software system imposes constraints on your processes. Are your users saying “I do this because that’s the way the system makes me do it”?

When ERP systems were introduced 20 years ago, they were rigid in their functionality. They forced companies to conform business processes to the dictates of the software, or required them to significantly customize the software to meet their specific requirements. However, business processes evolve over time while the software remains static. This causes a disparity between the way the software was originally implemented and the new requirements of the business. This evolution continues until you get to the point that the processes in the system actually constrict the ability of users to efficiently run your business. In common with the CEO mentioned above, this is a major reason why your company might end up implementing a newer, innovative, and proactive ERP system.

New enterprise ERP software applications like Microsoft Dynamics AX offer flexible business processes based on best practices and process tools such as workflow. Workflow is the ability to set up and change process flows within the system. It includes many capabilities such as electronic routing of documents, event notification, and automated processes based on triggers. Many ERP vendors offer flexible rules-based workflows that allow businesses to create custom processes based on their operations. These workflows can be changed as their preferences and requirements evolve. In some of the more sophisticated systems, power users are even able to diagram and implement new workflows with drag-and-drop technology. Such flexibility allows the ERP system to evolve with changes in business processes and practices in your company and industry.

As you assess the effect of your current ERP software on your business processes, you should consider the following questions:

  • Do your current business processes decrease efficiency and productivity?
  • Are they in place to make up for inefficiencies in the ERP system?
  • Have they been dictated by the system because of lack of functionality?
  • Have your business requirements changed over the years making the reasons you selected your current system no longer valid?
  • Have users created many sidebar and workaround systems outside the ERP?

Implementation of a flexible ERP system like allows your company to take advantage of new capabilities, functionality, and fresh ideas. An implementation partner that understands business process optimization and is industry expert is an excellent resource for efficiently implementing the system and effectively setting up your business processes. Selection and implementation of a modern ERP system can reduce manual processes, eliminate redundancy, and reduce paper documentation giving your company the opportunity to:

  • Review all business processes in place and determine which are required, which can be modified, and which can be eliminated.
  • Identify and eliminate redundancy and manual data entry.
  • Standardize business processes across all departments.
  • Adopt the best practices available in new software to obtain greater efficiency over the current ways of doing business.
  • Make use of flexible workflow functionality to take advantage of automated business processes, document routing, events, and alerts.
All businesses at one time or another have to weigh the costs and benefits of retaining an older ERP system against the costs and benefits of selecting and implementing a new one. Legacy systems, although on older technology, provide companies a level of comfort—comfort that is likely at the sacrifice of increased relevant functionality and technology.

Innovative and Proactive Applications - Better, Faster, Smarter

Traditional business applications evolved as passive, backward-looking systems of record.

Microsoft Dynamics AX already changes that model today, introducing embedded, declarative workflow that brings an understanding of business process optimization into the application and helps guide users forward through their work. When this is combined with pervasive embedded business intelligence that transforms the data captured in the system into insight empowering better decisions, the system becomes a more active, forward looking partner for the people who drive a business toward success.

Microsoft Dynamics AX also delivers innovative application scenarios today. These include, for example, a solution in retail that offers out-of-the-box connection from point of sale to the headquarters business system, and that unifies web and brick and mortar commerce in a single view of customer and transactions; as well as a system for manufacturers that supports discrete, process and lean manufacturing models in a single system instance, with planning and costing capabilities that work across all three models.

This is only the beginning. Microsoft Dynamics AX will evolve to embed constraint optimization and machine learning to deliver even more advanced, forward-looking capability to Dynamic Businesses. For example, Microsoft is currently developing systems that combine transaction history with information about key factors like weather, traffic, local event calendars and demographics to optimize daily order quantities for a retailer, minimizing out of stock and waste to drive greater profitability.

The four IT megatrends of the next decade - “Big data,” social connectedness, cloud computing, and mobility - will present new opportunities for business applications insight, and open up a whole new range of possibilities for business. Modern business applications won’t just make individuals and organizations smarter, but will go beyond this to new directions and new levels of impact we are just beginning to imagine.

Driving impact has always required insight but most systems today only focus on retrospective views and data. They are passive, reactive, and backward looking. Modern business applications will at the onset be proactive. They will inform with insights and possible actions while constantly evolving to point to what comes next.

Data continues to grow exponentially as does the ability to derive meaning from it. Social commentary has accelerated the pace of the review cycle, with likes, links and tweets providing instant clues to success or failure. Capturing this data and being able to tap into its rich and valuable insight is a new requirement.

Microsoft Dynamics AX helps people not only integrate and understand these new data sets, but also get to better answers with suggested actions so they can continually improve business performance. It achieves this by enabling people to calculate and/or recalculate business possibilities in real time. By focusing on connected, forward-looking systems, we can allow people to access actionable information with greater speed and agility – enabling businesses to respond more efficiently, effectively and proactively to changing market conditions.

Risk Management Suite Questions

Merit Solutions has spent a lot of time over the past couple of months demoing our Microsoft Dynamics GP Risk Management Suite and its capabilities to new prospects while providing training to existing clients looking to upgrade. In both situations, two questions always seem to pop up:

  1. How do we make sure that we get (got) the roles and users right?
  2. How do we make sure we don't create a burden with tracking too many changes?

Interestingly enough, the answer to both is very simple. The implementation - not so simple.

  1. The first thing that each client has to ensure is that their business processes are efficient and that their ERP system is setup in a way to support those processes. The Risk Management Suite will comply to any set of rules you require - helping you increase your efficiency while making sure you comply with regulations. To receive the maximum value, efficient business processes have to be in place - and, often, that is not an easy task to complete.
  2. As for the second question, we recommend that tracking changes should be limited to business critical fields, tables, and processes, as that will make the system easier to implement, changes easier to track and will help a company meet compliance regulations.

On occasion, companies tend to track everything, including tables with high volume of transactions. While this is possible to do with Audit Trails, as with any other Microsoft Dynamics GP table, this is not recommended, as it will affect performance of your SQL Server, which will in turn affect all users and systems that use it.

In order to generate the highest value from the Risk Management Suite, we suggest that companies craft a smart tracking plan prior to implementation with procedures and policies in place that limit adding new tables to Audit Trails tracking without a strong business reason why.