A CFO’s dilemma: Navigating ERP challenges in a growing manufacturing company
Overview
When companies experience rapid growth, critical technology processes may not align with new business needs, creating potentially significant operational challenges. An optimization project can address pain points and establish a scalable solution that can adapt to new and future demands.
Background
The chief financial officer of a midsize manufacturing company in Massachusetts had always focused on financial precision and operational efficiency. The company, a leader in designing and producing specialized industrial equipment, had recently experienced a period of rapid growth. With that growth, however, came mounting challenges in their NetSuite enterprise resource planning (ERP) system. While the platform was implemented years ago with the best intentions, its current state created inefficiencies across multiple departments.
One day, the company found itself in a familiar situation: reconciling discrepancies in invoices, manually tracking prepaid expenses and fielding complaints about difficulty accessing key data. Frustrated, the CFO knew something had to change.
As the company dug deeper,
numerous critical pain points emerged
Data accessibility and organization
Issue: Employees were struggling to locate the correct forms and utilize custom fields due to an overabundance of transaction and entity forms.
Impact: The company experienced wasted time and increased errors in reporting.
Invoices and
credit memos
Issue: Some invoices displayed incorrect totals and credit memos often lacked linked invoice numbers.
Impact: These issues resulted in potential vendor scrutiny and reconciliation difficulties.
Inventory and assembly management
Issue: The operations team was interested in advanced bill of materials (BOM) features and better tracking of inventory statuses.
Impact: Outdated processes created a risk of stock discrepancies and inefficiencies in production planning.
Purchase order and expense reporting
Issue: The approval workflow for purchase orders was cumbersome and expense reporting lacked a structured system.
Impact: These issues delayed purchasing decisions and led to difficulty managing budget tracking.
CRM and lead-to-quote processes
Issue: Sales teams were manually inputting data in the lead-to-quote process, leading to inconsistencies.
Impact: Manual processes led to loss of potential revenue due to inefficient customer tracking.
Training and role
management
Issue: Employees were not formally trained on NetSuite best practices and role permissions were too broad, creating security concerns.
Impact: This environment increased the likelihood of errors and security risks.
Project
Realizing the depth of these challenges, the company sought external experience and advice. That’s when they engaged RSM US LLP’s NetSuite team for a comprehensive assessment. RSM’s approach focused on three key areas:
- Deep-dive analysis: Conducting stakeholder interviews, system reviews and process mapping
- Targeted recommendations: Identifying process inefficiencies and suggesting NetSuite optimizations
- Implementation roadmap: Creating a clear action plan with prioritized improvements
In the NetSuite assessment, RSM detailed a path forward and delivered a strategic roadmap that included:
- Standardizing forms and custom fields: Simplifying NetSuite’s structure to enhance accessibility
- Invoice and credit memo cleanup: Ensuring accurate financial records and improving audit readiness
- Automating bank reconciliation: Leveraging NetSuite’s automation capabilities to accelerate month-end close
- Optimizing the chart of accounts: Introducing hierarchy and automating prepaid expense amortization
- Enhancing inventory management: Implementing advanced BOM features for better production tracking
- Streamlining purchase order approvals: Automating workflows to reduce approval bottlenecks
- Improving CRM and the lead-to-quote process: Reducing manual input and leveraging automation
- Implementing role-based training: Providing structured NetSuite training to increase system proficiency and security.
Outcomes
With RSM’s recommendations in place, the company now has a more efficient, scalable NetSuite environment. The company witnessed a transformation within several key business processes, with benefits including:
A 30% reduction in month-end close times
A significant drop in data errors and inefficiencies
Confident employees thanks to structured NetSuite training
A scalable ERP system ready to support future growth
For the company, the decision to assess and optimize NetSuite was a game changer
By working with RSM, the CFO’s team regained control over their financial and operational processes, setting the stage for sustained success.