This article was featured in the August, 2007 issue of the Technology First Magazine.

Dayton, OH
August 15, 2007

By Mikhail Roytman, Partner, Ellipse Solutions LLC

Selecting and implementing an enterprise-wide solution is typically one of the most important decisions facing any business. A small electronics manufacturer, a regional pharmaceutical distributor or a global conglomerate – all organizations are confronted with a constant need to improve internal processes and lower costs. Very often, the best way to accomplish this objective is through the automation of business procedures. This story launches a series of articles on how to properly choose and deliver an ERP solution in a Supply Chain Management environment specifically adapted to distribution and manufacturing companies based on the example of Microsoft Dynamics AX application. Today we will consider standard and custom business requirements for the Sales Order Management methodologies.

Who Is Buying My Products Or Services?

The first step in the investigation of Sales Order Management capabilities is to classify and define your customer base. Are you dealing with a limited number of customers buying large quantities of your products and services, or does your customer list consist of mostly one-time clients? How easy is it to sell to the other internal divisions within the same company? Can your system handle multi-lingual, multi-currency customers requiring a set of tailor-made sales documents and forms? Those are some of the criteria an ERP Project Manager must satisfy. Most modern packages are capable of managing fundamental Customer Master data.
MS Dynamics AX offers comprehensive solutions for international businesses, for which trade and logistics utilizing multiple currencies and dealing with special worldwide requirements is a part of the daily ritual.
If you are dealing with a multi-site facility it is very important to have an ability to sell, reserve, and view inventory levels within all locations. A wide-ranging intracompany sales feature will separate you from competition.
Moreover, a strong cross-functionality with an advanced Warehouse Management solution will greatly enhance your Sales Order Management capabilities.

In How Many Ways Can I Sell My Widgets?

We can’t all make widgets, so it is imperative to assure that your business solution will advance your sales capabilities, not reduce your opportunities. Selecting the most fitting option of processing and maintaining Sales Orders is vital as it will not only define your relationship with clients, but will also represent the main demand for your production and/or purchasing activities. MS Dynamics AX offers a variety of choices:

(1) Pass-through items are typically defined as products sold by distribution businesses “as received” from manufacturers. MS Dynamics AX provides a straightforward method of linking a Purchase Order to a Sales Order. On occasion such items involve small assembly operations (re-packing, re-labeling, etc.), so the capability of tying even a simple Bill Of Materials and/or Production Router is of great importance.

(2) The most common situation for the make-to-stock manufacturers/distributors is selling products directly from stock. For many businesses it is a matter of competitive advantage to allow your customers easy access to your sellable inventory levels either through direct views or through your customer service department. Information is Power.

(3) Whether you sell gift packages or aircraft engines, many companies have a need for combining and selling items as kits. Some of the characteristically challenging options MS Dynamics AX covers are the ability to sell a kit as a separate item or as individual components, discount management for items purchased as a part of a kit, etc.

(4) We can’t forget about make-to-order and engineer-to-order manufacturers. An option to link a Production Order to a Sales Order is essential in such an environment. The customers are spoiled these days – everyone wants a custom product.

(5) For many providers of small materials, blanket orders represent the primary way of conducting business. You’ve guessed it – MS Dynamics AX supports it as well.

(6) And what about service companies? MS Dynamics AX offers an uncomplicated option to sell non-inventory items. Additionally, through a Project Management module, sellable services can be tracked, summarized, reported on, and invoiced in various ways as a part of a defined project.

(7) When was the last time you bought something without checking the price? In most businesses, a Sales Order is preceded by a Sales Quote. MS Dynamics AX allows an easy methodology for converting a Quotation into a Sales Order as well as tracking the entered Quote as a part of the production demand.

(8) In the era of customizations and in the reality of every manager’s low inventory dream, a feature to handle substitute (or alternative) items is often a necessity.

(9) We all sell the greatest products in the world, yet on occasion those picky customers like to return the merchandise. MS Dynamics AX supports logic of issuing a credit memo/note on a Sales Order line item. Just make sure to tell your customers to keep the receipt.

(10) When my wife buys a new pair of shoes, it naturally comes with a new purse. In the real world, many companies sell associated items – an automotive component requiring a left bracket would most likely require a right bracket as well. MS Dynamics AX provides a “dynamic” way to link supplemental items.

We Are Different - Is There An Option To …?

No Sales Order Management system is complete without standard requirements such as Shipping Forecast, Sales Commissions coordination, comprehensive Invoicing options, Sales Analysis Reporting, ability to use multiple units of measures (and not only standard lbs-to-kgs, but a more complex alternatives such as boxes-to-pieces or cans-to-ounces, etc.). MS Dynamics AX offers these and other more intricate preferences such as pricing/quantity breakpoints, individual surcharges for special services, discount management, effectivity dates for sales order line items, etc. And don’t let me forget a complete CRM module conveniently connected to all other functions in the system.

Of course, this is just a high level overview of the standard Sales Order Management functionality. There are no identical twins in the business world – no two companies execute sales strategies the same way. Each tailor made requirement demands a detailed investigation. Once all of these pieces are put together, if modifications are still needed, one of most important advantages of MS Dynamics AX solution is how easily customizable and how user friendly this application is.
Until next time, your friendly ERP correspondent …

Mikhail Roytman is a Partner with Ellipse Solutions LLC, a global Microsoft Business Partner headquartered in Dayton, Ohio. Ellipse Solutions is a division of Roytman Information Services, Inc., a provider of Career Placement and Consulting solutions in Information Technology, Management and Engineering. For additional information please visit http://www.EllipseSolutions.com and http://www.roytmanIS.com