I was paging through Profit Magazine’s annual list of Canada’s 100 fastest growing companies yesterday, when I let out a whoop of approval. N2 Ingredients Inc., of Oakville, ON is ranked at number 38. (My whoop drew some interesting looks from fellow passengers on the flight to Montreal…)
N2 is a customer of my employer, using our Food Distribution and Inventory Management software. But more importantly, the principals of N2 are terrific people, and we consider them amongst the best we’ve done business with. Bob and Jill have grown their company the right way, and I have no doubt that their business will continue to grow and thrive.
This is not the first time we’ve had customers ranked in the Profit 100 – in fact in the last few years, several other Blue Link customers have been on this list.
It’s always gratifying to see good people succeed. Congratulations on the achievement!
It’s always interesting interviewing candidates for sales positions. Given that the interviewee is effectively trying to sell the interviewer, it’s important to watch the candidate’s technique very carefully. One should pay particular attention to their listening and questioning techniques, of course – it always amazes me when a candidate cannot repeat back to me basic facts I shared about the company 5 minutes earlier.
I also like to take careful note of the attitude towards sales prospects. Candidates who tend to “de-humanize” prospects are a big red flag. The most profitable and rewarding customer-vendor relationships are always the ones with a high level of mutual respect and integrity. A salesperson who sees each person as an individual and treats them accordingly may not necessarily sell more, but will bring in more profitable business.
As the above video illustrates quite effectively, the same can be said of the customer service people at a business software company. Where the technical support department uses a “one size fits all” approach, a significant percentage of customers end up dissatisfied with the responses and solutions provided. Same thing where rules of engagement on implementation and consulting are rigidly applied without first understanding the specific customer’s situation.
Take the term “Food Distribution Software”. At my company, the meaning is clear: business software targeted at food distributors. And until this morning I had never considered another meaning. Then an email from someone who found our web site in error opened my eyes to other possibilities. This person had been searching for something (not really sure what) and found our site by searching for “food distribution software“. He (or she – not clear) completed our online form, supplying bogus email and identity information, and accused us of being misleading – because our software doesn’t actually distribute food!
So to set the record straight, it’s true – our accounting and inventory management software does not actually distribute food. We leave that to the people who work at food distribution companies. We simply provide business / accounting / ERP software to those companies (and others).
There are other search terms that may lead people to us, and to pre-empt future criticism, I’d like to assure you that our software does not distribute “wholesales”, nor does it actually perform service and repair activities on equipment.
Software-as-a-service (SaaS) now rivals the traditional on-premise license model for many companies considering implementing or changing ERP software. So what are the pros and cons of the two approaches (in fact, there are 3 approaches, but that’s a subject for another day).
The author / presenter makes some very good points, many of them obvious but frequently overlooked. I think any company looking at an ERP or Accounting Software Package could benefit from spending 10 minutes on this presentation.
If you collect money from your customers before you’ve finished delivering the products and / or services covered by the payment, at what point have you actually earned the cash? The accounting or bookkeeping staff at many small and medium-sized businesses (SMB) are not sure how to account for these appropriately, and frequently simply recognize the revenue at the time the cash is received or an invoice is generated. In fact, usually the accounting software package they use does this automatically (which is good), and no further action is taken (which is bad).
This is a problem, because for example if you accept payment of $12,000 for a one year maintenance contract, and invoice the customer on day one of the contract term, you haven’t really earned any money on that day even though the accounting software will probably post the $12,000 to an income account. You will have to provide services over the next 12 months which are in effect prepaid by your customer, and it is as you provide those services that you actually earn the revenue.
In our simplistic example, you would earn $1,000 per month during the term of the maintenance contract. So after 4 months, you would have earned $4,000, and the remaining $8,000 should be reflected as a liability, probably called either “Deferred Revenue” or “Unearned Revenue”.
Why should the SMB owner care? Because if you have a bunch of contracts come up for renewal in one period, and many fewer in subsequent periods, your revenue and profitability in your monthly management reports are skewed – one month you think you’re doing better than you are, and subsequently things look bleaker than reality.
And you all do use monthly financial reports to manage your businesses – right?
Here’s an object lesson in the dangers of relying on your industry jargon when chatting with customers (or prospects). The software my company develops is known as ERP, or “Enterprise Resource Planning”, software. At least, it’s known as that by those of us in the business software industry, and by both technical and management people at larger enterprises.
ERP? Accounting Software?
But to most people who own, or even work at, smaller owner-managed companies, “ERP” is a meaningless acronym. Many would refer to this type of software as “accounting software”, despite the fact that it does a while lot more than accounting. So perhaps companies like ours should refer to their product accordingly. However this may be just as bad, because many will assume that an “accounting software package” does not include inventory management, purchasing, order processing, etc.
So what should we call it? Business Software? Too vague. Inventory Management software? Too narrow – that implies no accounting functionality. I honestly do not have the answer.
Please leave your suggestions in the comments section below.
Here are the top 5 – um – let’s call then “reasons” to not train employees properly and thoroughly on the business and accounting software / ERP software in use at your company.
Our employees enjoy doing things the hard way, and changing to more efficient and productive processes would spoil their fun.
We are never very busy or rushed, so we can afford to spend as much time as necessary fixing the errors caused by using the software incorrectly.
Our customers are very patient, and they always understand when we ship the wrong products or bill them the wrong amounts. They only ever object when we (frequently) forget to collect money from them.
When we hire new people, they particularly enjoy that initial settling in period when they don’t have a clue how to use the tools that are critical for the job performance. Happily for them, that period lasts a long time because we don’t bother them with training.
Money is not an object here, so we’re happy to leave on the table the tens of thousands of dollars we could be saving, rather than spending a fraction of that amount on training.
Being serious for a moment, here’s an example of an actual customer’s savings, based on average time saved per employee, after training nine employees as listed in the table:
Training Employees - ROI
And the total training cost, including an allowance for the time cost of having the employees trained during working hours? Less than $7,000.
Agree? Disagree? Let’s have your thoughts on the subject.
I recently heard a radio commercial asking me to pay more for my power. See http://www.bullfrogpower.com/ for more information on this. Given that it’s not every day a company solicits your business by asking you to pay more, it got me thinking…
Perhaps for business software vendors, this is an object lesson. Too many vendors try to seal the deal by competing on price. The flip side is that too many companies select key business software based, at least partly, on price. And that’s a dangerous game. Why? The obvious answer is that “you get what you pay for”, and that’s true in this context, but it’s not the whole story.
These Feel Better
Let’s use a shoe analogy: I used to buy cheap shoes, mostly because my preconceived notion was that it was a commodity. But a few years ago, I realized that my shoes did not last very last long, and my feet were always sore at the end of the day. I now buy more expensive, better quality shoes. They last much longer – partly because they of superior quality, but (and here’s the point – finally!) mostly because I spend more time and effort looking after them. Because I spend more, my shoes have now become an investment, not a commodity. My feet feel great, and over a period of time I’m probably not spending that much more (because as stated they last longer).
This analogy seems to apply to business software as well. The company I work for sells wholesale distribution software, and with very few exceptions customer satisfaction is directly proportionate to the amount of money invested in the solution. When customers take the implementation of the software more seriously, they derive many more of the benefits on offer. And it seems the more they invest, the more seriously they focus on proper implementation.
Pivot is an experiment from Microsoft Live Labs that promises to make it “easier to interact with massive amounts of data in ways that are powerful, informative, and fun”. Pivot allows you to view and interact with massive amounts of data on the Web, spread across many web sites, and zoom in and out to different levels of detail.
The basis of Pivot is “collections” of information from numerous web sites. Each collection can be used to view relationships and patterns between and across the pages in the collection. For example, here’s a collection of world leaders (presidents and prime ministers) grouped by age:
Click to enlarge
We could re-arrange to group (or filter) by country, continent, gender, role, and many others, with one or 2 clicks. We can filter further by specific age group, as shown here:
Click to enlarge
And at any stage we can click on one specific element (in this case, one leader) to get a search page of web resources for that leader (using Bing, of course – this is Microsoft Labs, not Google).
For a more detailed demonstration of this technology, watch this video.
Implementing new business software (such as ERP software) can be daunting. Most people are averse to big changes in life. Why? Because change is disturbing, and can cause feelings of anxiety and insecurity. Think about any major change in your life – even moving from high school to university or a full-time job can be quite difficult to manage emotionally, at least in the beginning.
One factor that’s frequently overlooked is denial. Denial is the classic first reaction in the face of trauma or loss. But the same basic human reaction comes into play when you face major changes in life (and work) – things have changed, and even if they’ve changed for the better, the initial reaction is often to believe that life will go on exactly as before – and therefore resist accepting that change.
You see this when a batch /paper based ERP system is replaced by a date-sensitive modern system. The old system required printing and filing multiple copies of customer invoices. With the new system, you need only print the customer’s copy – any other copy you may need can be retrieved online. Now that’s clearly a change for the better, yet many people in this situation either continue printing and filing those multiple copies, or if they’re unable to do so, become resistant to and negative about the new system.
As implementors, we need to understand and accommodate this. In this example, it may help the user to continue printing and filing some copies initially, and there’s really no harm in accommodating this as long as there is a clear plan of action to re-visit and eliminate it after a certain period of time – namely after the denial stage.
A good business software implementation consultant needs some soft skills to complement business, analytical and technical expertise. In my experience, though, very few actually do – many seem to want to browbeat their clients into accepting the systems and procedures.
Has your experience been the same? Please let me know your thoughts in the comments section below.
I was paging through Profit Magazine’s annual list of Canada’s 100 fastest growing companies yesterday, when I let out a whoop of approval. N2 Ingredients Inc., of Oakville, ON is ranked at number 38. (My whoop drew some interesting looks from fellow passengers on the flight to Montreal…)
Posted by Mark Canes 
