Adding Erp To Technology

The Benefits of Adding BI Technology to Your Dynamics ERP System

By Brett Hensley, Sales Director, TMC

Navigating the rapidly evolving and changing world of technology for your business data and processes can not only be daunting, it can be downright confusing. If you’re like one of the thousands of business users with an ERP system like Microsoft Dynamics, you’re probably familiar with the largest misconception of all: An ERP system is supposed to inherently and intuitively provide the analytics you need. It seems to be a logical claim since an ERP system is where you put all your data in. However, it’s not the case. You need another solution, known as business intelligence (BI), to provide you with the insight that enables you to make data-driven decisions, stay competitive, and push your business forward.

It’s important to keep in mind that BI technology and your ERP system aren’t mutually exclusive either. This quick overview will help you distinctly identify and understand the role BI plays, and the benefits it delivers, in conjunction with Microsoft Dynamics – all while giving you an understanding on the next steps you should take to get you where you need to be.

BI vs. ERP

Enterprise resource planning (ERP) is business process management software that allows an organization to use a system of integrated applications to manage a business and automate many back office functions related to technology, services, and human resources. ERP software, like Microsoft Dynamics NAV, GP, or AX, integrates all facets of an operation — including product planning, development, manufacturing, sales and marketing – all in a single database, application and user interface.

If a visualization of an ERP helps, picture the largest set of filing cabinets you have ever seen, enough to fill a warehouse.  Row after dusty row, stacked 3 or 4 high, you are unable to see the farthest wall.  Every cabinet is stuffed with paper records, invoices, canceled checks, and every detail of everything this company has ever done or been involved with.

Got it?  A modern ERP, in many ways, is the electronic/digital version of the warehouse of paper and is an excellent place for storage and retention of all of that data.

Business Intelligence

The Aberdeen Group, an American technology and services company, defines BI as the “ability to provide better decision support with integrated enterprise data, [it] is an important factor in turning data into actionable intelligence”.

BI delivers insight into your company’s operations and the more information being captured by the ERP system, the more the BI solution can present clarity on the financial health and efficiency of your entire organization.  This is the linkage between the effectiveness of a BI solution combined with the underlying ERP system.  The BI/ERP package needs to work, in balance, to provide the optimal benefit from each.  Using a world class BI solution to analyze QuickBooks-quality data will fail to maximize the investment in a BI solution.

Let’s go back to the warehouse…  Try to imagine how you would conduct a meaningful analysis of the sales activity between April and October of last year.  Start by going through all of the relevant file cabinets (organized by date, just to be helpful) and gather all of that paper.  Naturally, you will try to be efficient and will only select those documents that are relevant to your goal. However, you will find that looking for paper documents between April and October of last year is not only a very manual and time consuming task, once you have those documents, you will need to go through each piece of paper to find the data you’re looking for. It’s just not efficient and there is a better and faster way.

BI plays a different role to ERP

Given that both ERP and BI are concerned with the same details and data, it is not uncommon to see a company try to utilize an “all-in-one” approach and rely solely on the reporting and analytic tools within the ERP.  Doing so, however, is really confusing the different and complementary roles of the two systems.  In short, ERP is the system of record for the company, the final resting place for all of the details, transactions, and activities that comprise the history of the company.  BI is the tool that can unlock that volume of data, as well as allow for better projections and management of the company’s future activities and operations.

Better together

One of the main challenges in modern organizations is the incredible amount of data they gather that no one knows how to manage and make useful. This is where your business intelligence solution steps in and why more and more companies are finding the benefits and advantages of incorporating BI in their ERP program.

“The relationship between ERP and BI can indeed be the perfect storm, igniting improved performance and visibility.” – Aberdeen Group

When integrated correctly, your ERP transforms your business!

As the volume of data in the ERP grows over time (this is a good thing, it means your company is growing as well!), the tasks of producing meaningful insights into the company’s activities and future prospects will grow too.  It is vital to have a BI solution that can manage that volume of data and scale to match the expanding business.

Jon Oesch, VP of Sales at Jet Reports, is a data enthusiast who has dedicated his career to delivering solutions specifically for companies using Microsoft Dynamics to get the information they need for financial growth and overall optimization. He is convinced that ERP and BI solutions can and should work together, rapidly, for better business decisions and growth. Attached to the core “functionalities” of each solution, Jon explains that “ERP solutions are good at ‘the writing’ of data. They are optimized to take data in… They keep the data in an ultra-organized way. It insures that the same type of information will be captured the same way, each time… BI solutions are optimized to manage that data and transform them into actionable answers for your business.”

Taking the next step

So now that you know how your Microsoft Dynamics ERP works in tandem with BI solutions to give you a competitive edge, what do you do next? The first step is making sure that you evaluate and find an analytics solution that is built for your Microsoft Dynamics NAV, GP, or AX ERP. The second step is making sure that the solution you select meets your individual business needs. This may include budget and user adoption considerations. For instance, if your finance and executive teams are determined to work in Excel, it will be difficult to get them adopt another platform for obtaining the data they need to make decisions.  Likewise, you run major risks on leveraging and benefiting from BI at all if you bottleneck everything through IT.

To help companies jump start their initiative into BI, Jon Oesch and the Jet Reports team provide a comprehensive checklist as a guide to finding the best matched BI and reporting solution for you.