The past several years have seen a growth in outsourcing and an increase in the number of consultants of varying types. The bad economy has spurred the growth of entrepreneurship as people realize that jobs just aren’t there and start their own businesses instead. The government and many companies see outsourcing as way to reduce overhead costs and purchase services as needed.The interesting thing is that there is no certifying body or job qualification to becoming a consultant. You’re a consultant if you say you are and if someone is willing to pay you for your services.So with all the money being spent on consultants, it begs the question, “Are they really worth it?”Contractor or Consultant?An educated consumer is my best salesperson. However, many people don’t really know what they are buying when they hire a consultant. I personally make a distinction between contracting and consulting.Contracting involves the performance of a specific task and is characterized by an emphasis on deliverables and hourly rates. For example, the contractor may be asked to develop a specific plan or report or provide training. While there are exceptions, most of this type of work involves tasks that are well within the capability of the client organization. In essence, the contractor is doing work that the client could be doing but cannot do because of lack of time or resources.The problem with contracting work is that it is focused on a predetermined deliverable. Further, the deliverable can usually be developed by any competent contractor. This means that the contractor has very little latitude for creativity and hence must compete on the basis of price rather than expertise.Consulting is something quite different. As a consultant, my goal is to improve my client’s condition. My focus is not on specific deliverables but on the end result the client wants to achieve.Let me give you an example of what I mean. A client decides that his or her company needs an emergency plan and decides to hire a consultant. A contractor approaches the project by studying the requirements of the plan and estimating the hours required to produce the plan. A consultant realizes that the actual output is not the plan but increasing the company’s ability to respond to an emergency.This can be a hard sell sometimes. I once lost a potential contract because the client felt that I was asking their organization to do some work. They just wanted someone to revise a plan to meet an administrative requirement.Now don’t misunderstand me. I’m not against contracting work or suggesting that it is somehow bad. I actually do a fair bit of contract work, usually as a subcontractor to a larger firm. But during these types of assignments I am just another member of a team. I am neither particularly challenged by them nor is the client getting the full value I could provide.Who’s the Expert?A common misconception is that a consultant must always be an expert in your particular field. This is certainly true in many cases. However, particularly when you’re working with contractors, the individual working with you may not have any real expert knowledge. They may indeed have a background in your particular field, such as being a retired emergency manager, but that does not necessarily translate to expert knowledge nor to any special training in consulting practices.So who is the real expert? Actually, it’s you. You’re the one with expert knowledge about your field, your organization, and your problem. A consultant brings experience cleaned from working with other clients but will never have the in-depth knowledge that you possess.The fact is many consultants, myself included, are what we call “process consultants”. Our strength is not expert knowledge in your field but the skill set that we bring to your project.What this means is that a consultant can guide you through a process that leverages your expert knowledge to help you achieve your desired outcome. We help you build on your organizational strengths to achieve the results you are seeking.If there is a need for expert knowledge in a particular area, a good consultant will be able to access a network of professionals to find the information you need, much like a general practice physician will consult specialists.Because many clients don’t understand this concept, they tend to narrow their options by only considering consultants with specific knowledge, experience, and/or certifications. There are times when this is appropriate and necessary but in many cases the demonstrated skill set a consultant brings to your project may well be more important than specific knowledge of your industry.Working with ConsultantsTrue consulting work is about relationships. What will set one consultant above another is the level of trust that the consultant engenders in the client. If you have the slightest doubt about the ethics of a consultant or his or her ability to help you achieve your desired end state, get someone else.The relationship extends to how you work together. Unlike a contractor, a consultant is your peer, not a just a hired hand. You’re paying for the consultant’s advice and counsel, so make use of it. The consultant is a guide who helps you through the process to achieve your goals but this means you have to be part of that process. If your total involvement is to review deliverables prepared by the consultant, you are not getting your money’s worth.This doesn’t mean that you can let a consultant have free rein to do as he or she pleases. It is important to agree up front on metrics for progress. These are not the same as deliverables, by the way. They can be performance milestones or comparative surveys. The important thing is that you mutually agree on how you will define the success of the project and the metrics you will use to demonstrate that success.Getting More ValueOnce you understand these facts about consultants, you can make more informed decisions and get more value for your consulting dollars.Begin by looking at your project and defining what it is you want to accomplish. Forget the deliverables for the moment. You must first understand your expected outcomes. Once you have done this you can consider whether a specific deliverable is the true measure of achieving that outcome. You can also determine whether you need a consultant or a contractor.A common mistake is to try and work out all details of the project in advance. Contractors like to see this as it provides them detailed information on which to base their proposal costs. Consultants are not hourly workers – we’re paid for our results, not our time. If you can describe your desired outcome and the value of the project to your organization, we can usually offer a creative solution that would work for you. Again, do not focus on deliverables but on what you’re trying to achieve.Consider what it is you need in a consultant. Does your project require specific in-depth knowledge of your industry or field or will general knowledge suffice? What skill set should the consultant bring to the project?As you assess candidates, don’t just look at resumes, certifications, and other projects of a similar type. Focus on whether the candidate has the skill set you want and whether or not you feel comfortable with him or her. For example, instead of asking, “Have you ever done a similar project?” ask how they would approach your project. Past performance on a previous project is not necessarily an indicator that the same techniques will work in your corporate environment.As you begin the project, establish your metrics up front. It’s amazing the number of times I have had a client look uncomfortable when I ask how they will measure whether I have been successful with their project. They’re uncomfortable because they haven’t really thought about the end result of the project.So are consultants worth the money? That ultimately depends on you. If you haven’t defined what you want out of the project, then you’re not getting the full value out of your consultant. If you don’t allow the consultant to propose creative solutions, you’re not getting full value. If you don’t trust your consultant and seek their advice, you’re wasting your money and the consultant’s time.It’s really up to you to answer the question.
Best in Class Finance Functions For Police Forces
Background
Police funding has risen by £4.8 billion and 77 per cent (39 per cent in real terms) since 1997. However the days where forces have enjoyed such levels of funding are over.
Chief Constables and senior management recognize that the annual cycle of looking for efficiencies year-on-year is not sustainable, and will not address the cash shortfall in years to come.
Facing slower funding growth and real cash deficits in their budgets, the Police Service must adopt innovative strategies which generate the productivity and efficiency gains needed to deliver high quality policing to the public.
The step-change in performance required to meet this challenge will only be achieved if the police service fully embraces effective resource management and makes efficient and productive use of its technology, partnerships and people.
The finance function has an essential role to play in addressing these challenges and supporting Forces’ objectives economically and efficiently.
Challenge
Police Forces tend to nurture a divisional and departmental culture rather than a corporate one, with individual procurement activities that do not exploit economies of scale. This is in part the result of over a decade of devolving functions from the center to the.divisions.
In order to reduce costs, improve efficiency and mitigate against the threat of “top down” mandatory, centrally-driven initiatives, Police Forces need to set up a corporate back office and induce behavioral change. This change must involve compliance with a corporate culture rather than a series of silos running through the organization.
Developing a Best in Class Finance Function
Traditionally finance functions within Police Forces have focused on transactional processing with only limited support for management information and business decision support. With a renewed focus on efficiencies, there is now a pressing need for finance departments to transform in order to add greater value to the force but with minimal costs.
1) Aligning to Force Strategy
As Police Forces need finance to function, it is imperative that finance and operations are closely aligned. This collaboration can be very powerful and help deliver significant improvements to a Force, but in order to achieve this model, there are many barriers to overcome. Finance Directors must look at whether their Force is ready for this collaboration, but more importantly, they must consider whether the Force itself can survive without it.
Finance requires a clear vision that centers around its role as a balanced business partner. However to achieve this vision a huge effort is required from the bottom up to understand the significant complexity in underlying systems and processes and to devise a way forward that can work for that particular organization.
The success of any change management program is dependent on its execution. Change is difficult and costly to execute correctly, and often, Police Forces lack the relevant experience to achieve such change. Although finance directors are required to hold appropriate professional qualifications (as opposed to being former police officers as was the case a few years ago) many have progressed within the Public Sector with limited opportunities for learning from and interaction with best in class methodologies. In addition cultural issues around self-preservation can present barriers to change.
Whilst it is relatively easy to get the message of finance transformation across, securing commitment to embark on bold change can be tough. Business cases often lack the quality required to drive through change and even where they are of exceptional quality senior police officers often lack the commercial awareness to trust them.
2) Supporting Force Decisions
Many Finance Directors are keen to develop their finance functions. The challenge they face is convincing the rest of the Force that the finance function can add value – by devoting more time and effort to financial analysis and providing senior management with the tools to understand the financial implications of major strategic decisions.
Maintaining Financial Controls and Managing Risk
Sarbanes Oxley, International Financial Reporting Standards (IFRS), Basel II and Individual Capital Assessments (ICA) have all put financial controls and reporting under the spotlight in the private sector. This in turn is increasing the spotlight on financial controls in the public sector.
A ‘Best in Class’ Police Force finance function will not just have the minimum controls to meet the regulatory requirements but will evaluate how the legislation and regulations that the finance function are required to comply with, can be leveraged to provide value to the organization. Providing strategic information that will enable the force to meet its objectives is a key task for a leading finance function.
3) Value to the Force
The drive for development over the last decade or so, has moved decision making to the Divisions and has led to an increase in costs in the finance function. Through utilizing a number of initiatives in a program of transformation, a Force can leverage up to 40% of savings on the cost of finance together with improving the responsiveness of finance teams and the quality of financial information. These initiatives include:
Centralization
By centralizing the finance function, a Police Force can create centers of excellence where industry best practice can be developed and shared. This will not only re-empower the department, creating greater independence and objectivity in assessing projects and performance, but also lead to more consistent management information and a higher degree of control. A Police Force can also develop a business partner group to act as strategic liaisons to departments and divisions. The business partners would, for example, advise on how the departmental and divisional commanders can meet the budget in future months instead of merely advising that the budget has been missed for the previous month.
With the mundane number crunching being performed in a shared service center, finance professionals will find they now have time to act as business partners to divisions and departments and focus on the strategic issues.
The cultural impact on the departments and divisional commanders should not be underestimated. Commanders will be concerned that:
o Their budgets will be centralized
o Workloads would increase
o There will be limited access to finance individuals
o There will not be on site support
However, if the centralized shared service center is designed appropriately none of the above should apply. In fact from centralization under a best practice model, leaders should accrue the following benefits:
o Strategic advice provided by business partners
o Increased flexibility
o Improved management information
o Faster transactions
o Reduced number of unresolved queries
o Greater clarity on service and cost of provision
o Forum for finance to be strategically aligned to the needs of the Force
A Force that moves from a de-centralized to a centralized system should try and ensure that the finance function does not lose touch with the Chief Constable and Divisional Commanders. Forces need to have a robust business case for finance transformation combined with a governance structure that spans operational, tactical and strategic requirements. There is a risk that potential benefits of implementing such a change may not be realized if the program is not carefully managed. Investment is needed to create a successful centralized finance function. Typically the future potential benefits of greater visibility and control, consistent processes, standardized management information, economies of scale, long-term cost savings and an empowered group of proud finance professionals, should outweigh those initial costs.
To reduce the commercial, operational and capability risks, the finance functions can be completely outsourced or partially outsourced to third parties. This will provide guaranteed cost benefits and may provide the opportunity to leverage relationships with vendors that provide best practice processes.
Process Efficiencies
Typically for Police Forces the focus on development has developed a silo based culture with disparate processes. As a result significant opportunities exist for standardization and simplification of processes which provide scalability, reduce manual effort and deliver business benefit. From simply rationalizing processes, a force can typically accrue a 40% reduction in the number of processes. An example of this is the use of electronic bank statements instead of using the manual bank statement for bank reconciliation and accounts receivable processes. This would save considerable effort that is involved in analyzing the data, moving the data onto different spreadsheet and inputting the data into the financial systems.
Organizations that possess a silo operating model tend to have significant inefficiencies and duplication in their processes, for example in HR and Payroll. This is largely due to the teams involved meeting their own goals but not aligning to the corporate objectives of an organization. Police Forces have a number of independent teams that are reliant on one another for data with finance in departments, divisions and headquarters sending and receiving information from each other as well as from the rest of the Force. The silo model leads to ineffective data being received by the teams that then have to carry out additional work to obtain the information required.
Whilst the argument for development has been well made in the context of moving decision making closer to operational service delivery, the added cost in terms of resources, duplication and misaligned processes has rarely featured in the debate. In the current financial climate these costs need to be recognized.
Culture
Within transactional processes, a leading finance function will set up targets for staff members on a daily basis. This target setting is an element of the metric based culture that leading finance functions develop. If the appropriate metrics of productivity and quality are applied and when these targets are challenging but not impossible, this is proven to result in improvements to productivity and quality.
A ‘Best in Class’ finance function in Police Forces will have a service focused culture, with the primary objectives of providing a high level of satisfaction for its customers (departments, divisions, employees & suppliers). A ‘Best in Class’ finance function will measure customer satisfaction on a timely basis through a metric based approach. This will be combined with a team wide focus on process improvement, with process owners, that will not necessarily be the team leads, owning force-wide improvement to each of the finance processes.
Organizational Improvements
Organizational structures within Police Forces are typically made up of supervisors leading teams of one to four team members. Through centralizing and consolidating the finance function, an opportunity exists to increase the span of control to best practice levels of 6 to 8 team members to one team lead / supervisor. By adjusting the organizational structure and increasing the span of control, Police Forces can accrue significant cashable benefit from a reduction in the number of team leads and team leads can accrue better management experience from managing larger teams.
Technology Enabled Improvements
There are a significant number of technology improvements that a Police Force could implement to help develop a ‘Best in Class’ finance function.
These include:
A) Scanning and workflow
Through adopting a scanning and workflow solution to replace manual processes, improved visibility, transparency and efficiencies can be reaped.
B) Call logging, tracking and workflow tool
Police Forces generally have a number of individuals responding to internal and supplier queries. These queries are neither logged nor tracked. The consequence of this is dual:
o Queries consume considerable effort within a particular finance team. There is a high risk of duplicated effort from the lack of logging of queries. For example, a query could be responded to for 30 minutes by person A in the finance team. Due to this query not being logged, if the individual that raised the query called up again and spoke to a different person then just for one additional question, this could take up to 20 minutes to ensure that the background was appropriately explained.
o Queries can have numerous interfaces with the business. An unresolved query can be responded against by up to four separate teams with considerable delay in providing a clear answer for the supplier.
The implementation of a call logging, tracking and workflow tool to document, measure and close internal and supplier queries combined with the set up of a central queries team, would significantly reduce the effort involved in responding to queries within the finance departments and divisions, as well as within the actual divisions and departments, and procurement.
C) Database solution
Throughout finance departments there are a significant number of spreadsheets utilized prior to input into the financial system. There is a tendency to transfer information manually from one spreadsheet to another to meet the needs of different teams.
Replacing the spreadsheets with a database solution would rationalize the number of inputs and lead to effort savings for the front line Police Officers as well as Police Staff.
D) Customize reports
In obtaining management information from the financial systems, police staff run a series of reports, import these into excel, use lookups to match the data and implement pivots to illustrate the data as required. There is significant manual effort that is involved in carrying out this work. Through customizing reports the outputs from the financial system can be set up to provide the data in the formats required through the click of a button. This would have the benefit of reduced effort and improved motivation for team members that previously carried out these mundane tasks.
In designing, procuring and implementing new technology enabling tools, a Police Force will face a number of challenges including investment approval; IT capacity; capability; and procurement.
These challenges can be mitigated through partnering with a third party service company with whom the investment can be shared, the skills can be provided and the procurement cycle can be minimized.
Conclusion
It is clear that cultural, process and technology change is required if police forces are to deliver both sustainable efficiencies and high quality services. In an environment where for the first time forces face real cash deficits and face having to reduce police officer and support staff numbers whilst maintaining current performance levels the current finance delivery models requires new thinking.
While there a number of barriers to be overcome in achieving a best in class finance function, it won’t be long before such a decision becomes mandatory. Those who are ahead of the curve will inevitably find themselves in a stronger position.
Microsoft Dynamics Business Central for Manufacturing – A Viable ERP System?
Why Should we care if we can use Dynamics Business Central for Manufacturing?Given the disruption of the past year, a lot of businesses are investigating ways to work remotely and in a hybrid work environment. There are a few technologies that manufacturing companies need to use that don’t work well remotely. One of them is ERP systems. That’s why we should care about Dynamics Business Central for Manufacturing.If you are looking to replace an ERP system because you want to ensure it facilitates remote work, cloud ERP is where you need to look. My experience is almost entirely with what is often called “SMB” or Small and Medium Business manufacturers.There are not a lot of good, modern cloud based ERP systems in the mid-market / SMB space. There are even less that really support manufacturing. That means that the best cloud systems are priced out of most manufacturers budget.Oh, In case you are wondering, Microsoft defines SMB as businesses with less than 250 computers. That’s a pretty large manufacturer.What is Business Central?In the simplest terms, Business Central is the new brand name for Microsoft Dynamics NAV. In all the ways that count this cutting edge new cloud based ERP is the old Dynamics NAV reimagined in the cloud.Microsoft did not shirk on the technology either! They have a boat load of money, and they were willing to spend a lot of it on Business Central.The full name of the product is Dynamics 365 Business Central. That 365 should look familiar, because it appears on Office 365, Microsoft 365 etc…This does mean that Business Central is part of the same suite of products you might already be using for your Outlook email, Teams communication, Microsoft Word or Excel productivity tools. And yes, that is a big advantage to Microsoft. It doesn’t mean that it will work in Manufacturing however – so that remains to be seen.How does it compare with more traditional manufacturing ERP?I recently wrote a blog comparing Dynamics Business Central for manufacturing with a pretty well respected mid-market pure manufacturing ERP called Infor Visual ERP.I worked extensively with Visual ERP for almost 20 years (ironically I never sold a copy in all that time). I ran the firm that people who had trouble with the system came to for help.When I migrated my business away from Infor Visual, I investigated a lot of products. I settled on Dynamics NAV (which later became Business Central) after significant research.By 2014 we had started switching Visual ERP customers Microsoft Dynamics NAV manufacturing. There are a few small areas that Visual might do a bit better in. That is more than overcome by two main factors that make Microsoft Dynamics Business Central for manufacturing really shine.CustomizabilityDynamics NAV and now Business Central are extremely easy to program, which let us enhance it in ways you absolutely could not with Visual. It’s so easy to program that we are essentially giving away “Missing” Visual features when we sell the product.This customization let us plug any holes we found. It also allowed us to do the one thing Visual customers always cried about. We could make small, easily maintained, incremental changes. We could adjust the system to make it work better for the customer.We avoided any kind of massive programming (although in my time I’ve seen other partners who didn’t avoid the same). We focused on making really useful changes that allowed the customer to get rapid benefits. This made a huge difference to customers. It can be a game changer when a very small change saves staff hours every week.Dynamics 365 AppSource AddonsMore or less related is the existence of addons for Microsoft Dynamics products.When we first started selling Dynamics NAV for manufacturing, there was no AppSource. AppSource is like the Google Play store or Apple Apps store. It’s a place to go and rapidly (in seconds really) install addons.In the early days these addons existed, were certified by Microsoft, but did not exist in any central location. Today things are even better. With Appsource we can really enhance Dynamics Business Central for manufacturing. I mention a couple of those modules below.Wait! I have to get Addons
Agile Manufacturing
Version Management
Inventory Planning
Demand Forecasting
Machine Centre Management
Capacity Planning
Finite Loading
Production Bill of Materials
Production Scheduling
Supply Planning
Modes of Manufacturing for Business CentralI tend to think of manufacturing ERP projects in terms of the mode of manufacturing being used. There are different definitions from different organizations (mainly APICS) but these are the ones I tend to see and my take on how good Business Central for manufacturing is for these modes.Engineer to Order – ETOThis is my favorite. I worked at an ETO for a few years before starting my own business. Dynamics Business Central for Manufacturing includes a really powerful project accounting module called Jobs. Since ETO manufacturers are really project manufacturers, this jobs module is a solid foundation. There are a few additional addons that I strongly recommend (including one that we created) to make the fit even better.Overall – Business Central for ETO is really good.Make to Order and Make to Stock – Production ManufacturingMake to Order and Make to Stock are usually two separate modes of manufacturing (and they are) but I combine them into one mode I call Production Manufacturing. The out of the box manufacturing modules that are part of Business Central Premium work great for these businesses. Many of them also want the addins that I list below – which are great extra features.Job ShopsJob shops tend to come in the biggest variety and tend to actually not fit that well into either ETO or Production Manufacturing. I’d want to see the Job Shop to see whether it’s more of a micro-production shop (very common – I call these “repetitive job shops”) or whether it’s more of a custom mini-project manufacturer like a light ETO.These businesses vary a lot in what they make. A food co-packer is technically a job shop. So is a welding service business, a small machine shop etc…Whatever the case, it is a good fit for Dynamics Business Central for manufacturing.Process ManufacturingProcess Manufacturing is usually related to making one of the following:
Cosmetics
Chemicals
Nutraceuticals
Pharmaceuticals
Food manufacturing
Process manufacturing needs some heavy duty addons for Business Central to work properly. This is outside my comfort zone to be honest. The regulations and batch manufacturing processes are really unique. I have a few colleagues that I send these kinds of prospects to. Those addons for Business Central are extremely good, and handle this industry very, very well.Graphics Arts ManufacturingPrint Manufacturing is it’s own sub-type, really a form of either Job Shop or Production Manufacturing depending on what they make. These businesses don’t work as well out of the box with Dynamics Business Central for Manufacturing. They usually fall into these categories.
Commercial Print (magazines, business carts, posters, flyers etc. – a real Job Shop)
Folding Cartons (think a toothpaste box, or cereal box. Can be production or Job Shop)
Flexible Packaging (these companies make the plastic bags you get consumer goods in)
Labels (could be a wine bottle label, or a shampoo bottle, or your aspirin).
Wide Format (think huge banners, giant photographs on walls in a mall etc.)
This mode of manufacturing has a really great addon for Business Central called PrintVis. PrintVis is a Print manufacturing MIS software addon that turns Business Central into arguably the best Print MIS in the market.Add-ins Recommended by MeMy team has reviewed many addon solutions since we started working with Business Central for manufacturing. Here are our top choices:InsightWorks Shop Floor Insights (SFI)This is a manufacturing execution system for collecting job costing data (time), production reporting and materials use in real time. Comes with a nifty scheduling tool also.InsightWorks Warehouse Insights (WHI)This product is my favorite wireless barcoding solution for warehouse management. It runs on most of major brands of wireless devices used in warehouses today. I think it’s a great mid-level warehouse management solution.Netronic Visual Production SchedulerFor those who need a a graphical drag and drop scheduler, Netronic is the industry standard for Business Central. Their Visual Production Scheduler is more or less for visualizing and manually editing the schedule. The Advanced Production Scheduler is more robust and will do best fit scheduling.ConclusionWe’ve taken a look at using Dynamics Business Central for manufacturing in this article. I’ve had the opportunity to oversee the implementation of this system in more than 50 companies, and so far, so good. For that SMB manufacturer with 20 employees who work in the office and 60 that work in the shop – this is a great system. We’ve got a few customers with 500+ total employees using it very successfully. We also have a few with 10 total employees, and they are able to make it work.If you are a manufacturing company that is in the small or medium market (again – less than 250 computers) looking for ERP I strongly suggest you look at Microsoft Dynamics. I can confidently say that as an ERP Dynamics Business Central for manufacturing is a great fit.