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Dynamics™ AX at Contoso

Omar Dada

Tinesha Holcomb

Jerilyn Kelly

Arabiou Diallo

Institution Affiliations

Abstract

The current paper focuses on a solution that can be given to Contoso. The company is faced with major challenges that can be categorized as sales process where issues of sale leadership, lead tracking, and order processing issues arise. The other areas are marketing and manufacturing. The challenges can be solved by implementing the Microsoft Dynamics AX system. The proposed system will help the firm handle the increasing workload irrespective of its location in the world. Moreover, some of the many solutions that it will help address include sales process solutions, marketing concerns, manufacturing, accounting and internal control, internal growth issues, and dealing with disparate systems. The paper also covers the steps of implementing the new ERP system. One of the key steps identified is assessing the resistance to change in the organization. Change management will help to solve the issues related to resistance. The company also needs to clearly define the steps for implementing the change.

Dynamics™ AX at Contoso

Introduction

Background Information

At Litware Inc., we are professionals in enterprise resource planning and customer resource management solutions since we have worked with many customers across the globe. Our resolve has not only been focusing on providing companies with software such as Microsoft Dynamics solutions but also on ensuring that the solutions provided do meet the needs of every organization that we work with. In this report, we feature the discussion of ERP and CRM proposals for one of our clients who recently contacted the company with major problems in the management of business operations. Some of the operations include the management of human resources, sales and marketing operations, and the management of the supply chain concerns among other issues that will be discussed in details in the next few pages.

The company herein referred is called Contoso. Contoso operates on a global scale with operations in Japan, Italy, and the United States. Customers can be from anywhere in the world, but mainly they are from Canada and the United States. However, in the process of doing business, the company interacts with other ecosystems across the globe.

According to information provided by this company, Contoso is faced with major challenges, which can be broadly categorized into several areas of operations. The areas include the sales process where issues of sale leadership, lead tracking, and order processing issues arise. There is also the area of marketing where the company's marketing leadership indicates that it finds difficulties with marketing initiatives. Under manufacturing, the organization faces major challenges on production planning as well as several other issues in the manufacturing process and additionally, there is the area of financial control which appears to be the most affected by the poor ERP and CRM systems used by Contoso. The other concern is the management of human resources as well as growth, especially when considering the fact that the firm operates on a global scale. Arguably, this exposes it to the risks of operating in the global environment, the language challenges, as well as culture challenges.

Diagnosis of Key Issues

After assessing the case of Contoso, Litware can confirm that there are several key issues that have been the reason for the problems faced by the company. The first major problem is the fact that the company employs the use of several disintegrated enterprise resource planning systems. These systems would require to be integrated. However, there is a second problem and this is the fact that the various ERP systems used by the company have limited functionality, which is related directly to the fact that the firm made the wrong choices in the selection of the system. The systems are considered to be suitable for organizations smaller than Contoso. Thirdly, the organization's enterprise resource planning systems did not anticipate the robust organizational growth that the company has experienced over its lifetime. Consequently, the firm was not ready for the fact that it would require a more robust enterprise resource planning system to manage in a culturally diverse environment that is characterized by different languages and global reach. The last and major consideration is that the ERP system lacks CRM capabilities and as a result, the organization is resigned to the use of spreadsheets such as Microsoft Excel. Such issues expose the organization to major errors and a lot of difficulties in the management of all businesses simply because these spreadsheets were not meant to handle the work of an ERP system. At Litware, we understand that one of the reasons why Contoso has not been able to change to a more modernized enterprise resource planning system is the fact that there is a lot of resistance to change. In the solutions that we provide herein, we are focused on ensuring that there will be little to no disturbance to the business and operations of the company.

Proposed Solution

Considering the background information and the key issues identified in this report, the study focuses on ascertaining that Contoso puts an end to all the enterprise resource planning system and customer relationship management system through the implementation of a robust system that brings forth the capacity to deal with all the problems faced by Contoso. Contoso must invest in the Microsoft Dynamics AX system. Herein referred to as Dynamics™ AX, the system is a product of Microsoft's business solutions division. The system combines the use of multiple languages and multiple currencies, which it the best choice when looking for a system that can be operated seamlessly across the globe (Luszczak, 2016). It provides the user with solutions for the financial planning and management, the management of people, including the human resources and the customers, and the management of operations and processes, such as the manufacturing processes and the management of the supply chain.

Owing to the dynamism of the Dynamics™ AX solution, it has been widely applied in the management of large business organizations across all sectors including the financial services sector (See figure 1). This confirms the fact that it is a good solution when dealing with operations that require being highly secure and impenetrable. Secondly, is has been applied and used by both non-governmental organizations and governmental organizations confirming the fact that it has a wide array of applications and it is for this reason that is considered to be the solution that best fits the case of Contoso.

Figure 1: Interface of Dynamics™ AX. (Source https://kurthatlevik.wordpress.com/2013/09/12/my-dynamics-ax-preselling-tips/)

The selection of Dynamics™ AX was anchored on the understanding of the many problems that Contoso faces with its current disintegrated enterprise resource planning systems. Secondly, it is based on the notion that the company will continue to grow. To succeed, the firm needs a system that can handle the increasing workload irrespective of the location in the world. However, it is important to note that Dynamics™ AX would attract a higher cost that simpler systems such as Dynamics™ CRM, Dynamics™ C5, and Dynamics™ SL among several other systems produced and marketed by Microsoft Inc. On this note, Litware considers that it is providing the company with the best system regarding functionality and above that, the bets system regarding the value that it creates for the firm. In the following few sections, this report will highlight how the solution herein proposed would help in dealing with each of the issues identified in the case of Contoso. In doing so, the report will focus on specific areas of functionality in the Dynamics™ AX solution. Therefore, this will be important in informing the management of the company on why considering this solution is important. The sections are presented as they appear in the case study.

Sales Process Solutions

One of the areas where the company is facing major challenges is in the sales process. Interviews with the head of sales indicated that the firm faces major changes with identifying and tracking leads. This means that the company finds difficulties with the identification of potential customers and when they do, the lead has already been converted to a proposal. Secondly, there is not adequate information on how many leads are converted to a sales proposal and finally to a sale. Thirdly, the company faces the challenge of ascertaining the integrity of the data available to the customers as well as on the sales, duplication of customer records is in plenty, and the branches do not have the capacity to effectively share files and documents. They are serving the same markets in the United States and Canada. In simple terms, the company is just not able to credibly, efficiently, and effectively manage the customers.

According to the proposal herein provides, the Dynamics™ AX system would aid the company in dealing with the customer and sales management concerns at the company. In the introduction of the proposal, we indicated that the system has the functionality to deal with the people and under the people, the system has various options. One such option is the management of the customer relationships, and in the simplest terms, this means that the Dynamics™ AX systems combine the power of an ERP system with that of a CRM system.

Under the CRM functionality, the organization can capture data on the customers, including the names, location, contacts, and history of doing business with the company (Tavana, 2012). It also includes adequate information on when the customer last interacted with the company and whether such interaction resulted in a conversion or not. Additionally, the system has extensible features that allow the firm to create complete files of the customers. Arguably, this ensures that at any time, the company keeps track of all engagements with the customer.

There are several advantages of having the CRM system inbuilt in Dynamics™ AX systems. Firstly, it provides a one-stop location where the organization can access all customer records (Luszczak, 2016). Secondly, the system operates seamlessly across all departments and branches of the organization such that the same file being viewed in Japan is available to the sales leaders in Italy and those in Maine in the United States. Secondly, the system allows the company to dedicate regional sales to independent leaders such that if a lead comes through from Canada, then this information is made available to the business leader for the region. If a lead is generated form the EMEA region, then it is seen by the person responsible for this region. Oher than that, Dynamics™ AX provides the sales team with reports that can be prepared and printed at any time and frequency as the company may desire. It also allows the sharing of the documents in the system. The overall impact is the holding of complete records of the customers in the system and ensuring that these records are of high integrity.

Marketing Concerns

The second area of interest is in the marketing department where the leader is concerned about marketing research and how to ensure that its effectiveness can be tested across different customer segments, geographical locations, and the industry. The leader of the marketing department also requires a system that enables her to track the performance of marketing approaches across different regions, the return on investment, and the pricing of products. The Dynamics™ AX provided this solution through the advanced level integration of systems such that data can be presented regarding regions and customers segments (Luszczak, 2016).

From the analysis of the functionality of Dynamics™ AX, the most important capacity that it offers the marketing department is the ability to share data across different regions. This means that the market researchers in Italy can share models and results with those in Japan and those in the United States. They can be able to test the performance across the different regions and overall, they can be able to combine their reports forming a marketing research report for the whole market and the whole company. Notably, marketing research initiatives touch on various functionalities of the system including the customer data, regional data, financial data, currency data, and other information necessary to create a complete report. With the cloud storage capacity and other features, the market research department can also access this information at any time when required.

Manufacturing

Manufacturing management is another functional area of concern for the company and one in which the Dynamics™ AX system would greatly help improve. From the analysis of available information from the case, the managers of the company are concerned about how to effectively capture information on design of products and customization, how to share information on product design, and how to account for the changes in the design. Additionally, the company faces major difficulties on the sharing of this information.

The analysis of the case at hand creates the need to consider the question on whether in any way the company assessed whether the current systems were fit for a manufacturing enterprise. From the analysis of Dynamics™ AX, Microsoft invested time and resources in ensuring that it provided solutions for different customer segments, including merchandising enterprises including retailers, financial services, and specialized service companies such as audit firms. In addition, there was the consideration of the manufacturing entities in Dynamics™ AX, which is why when configuring the system, the company must identify itself as a manufacturing enterprise. As a fact, this would ascertain that the systems show the manufacturer all the capabilities of an ERP system meant for a manufacturing entity (Phillips, 2013). It would enable the organization to be able to design products in the system, enter costing information, and share the information with all stakeholders in the organization. In addition, the systems provide the company with the ability to serialize the designs and ensure that they are not in any way mixed up with other solutions or even confused with other product. This is particularly the reason why the use of the system and the nature of the company must be observed when purchasing an ERP system. Fortunately, Dynamics™ AX contains all these features, and this is a good reason why the company must consider the system when investing and seeking to deal with the problems in the manufacturing department.

Accounting and Internal Control

The accounting component of an ERP system is considered by many specialists as its most important feature. By itself, the accounting and internal control are seen as the most vital and the most complex part of the system. With the Dynamics™ AX, the designers ensured that all the complexities are eliminated and that there are straightforward ways of dealing with the accounting issues.

Dynamics™ AX focused on the entire accounting process when designing this ERP solution. The system creates all necessary documentation from the process of receiving an inquiry, the sending of a quotation, the placement of order, the invoicing and billing process, the receipt of the payment, banking, and all other features of the sales transaction process. On the other hand, there is the purchase generation and payment process that is also as detailed as required of any accounting system. The importance of this is to guarantee that every transaction is traceable from the end of a customer to the end of the financial reports (Luszczak, 2016). It combines the features of inventory management systems, order generation systems, manufacturing planning systems, and sales planning system all in one. With the Dynamics™ AX, the accounting and control features are considered to be the cog and wheel of the system.

Focusing on the internal controls, the access to information and authorization of transactions takes pace on several levels. The effective working of this system is on the granting of permissions at several levels through passwords and as a result, the users of the system are checked on the functions of the system that they can use and to work on this they automatically receive updates from all areas related to a particular section of the system. In light of this information, Microsoft recognized that there would be many people in a company who will be using the system and for this reason, it created the capacity to ensure that every person can only access that section of the system where they are authorized to access.

Internal Growth Issues

The last major factor is on how Dynamics™ AX will aid the internal growing concerns of the company. The company already has branches in three international locations, and soon that number will grow. The locations are almost semi-autonomous and operate independently, but in the end, their reports and operations need to be harmonized with those of the headquarters. What this means is that the company needs systems that would be seamlessly applicable across different international locations, with different currencies, and with different languages and procedures. Dynamics™ AX offers all these functionalities based on the fact that it was designed for organizations that are growing both in the number of business lines and in the number of locations of operations. In the company at hand, Dynamics™ AX would ensure efficient and effective dealing with all the issues face in the international business environment. Through the advanced connectivity and cloud systems, information will be shared seamlessly across all nations and production planning will consider sales demand across all nations (Luszczak, 2016). In other words, the different branches across all the markets will work as one unit in all aspects and this is all due to the power and capabilities of the Dynamics™ AX ERP system. The system will also help the company in dealing with the issue of a global logistics nightmare.

Dealing with Disparate Systems

With the Dynamics™ AX solution as proposed herein, the company will be operating in a highly integrated market based on all the features and capabilities that are inbuilt in the Dynamics™ AX. This is a response to the integration challenge that any other solution would have. Currently, Contoso runs on many disparate systems all with limited capacities and functionality. It would require integrating all the systems that are currently running and even then, the company would not be able to fully enjoy the benefits that Dynamics™ AX offers. For instance, the company would require separate CRM systems for each of the locations. Moreover, it would require separate accounting systems and different systems to manage operations. Integrating all these systems would be a challenge because of the geographical locations, language challenges, programming, and all other issue related to the creation of a single working system from many different parts. There would be major challenges, especially on the compatibility of the different systems. Secondly, there would be many challenges on the sharing of data and the security of the systems.

Thirdly, there would be major cost implications with the analysis of the problems mentioned in the report indicating that the cost of integration would be much higher than the cost of acquiring a new system in the name of Dynamics™ AX. Further, the analysis considers that failing to invest in Dynamics™ AX and instead choosing to integrate the systems would simply be a form of delayed gratification considering that the firm is still growing internally and the need for a robust ERP system is on the rise. All these factors indicate the fact that the process of integration for the systems of Contoso presents a logistics, challenge, a technical challenge, and an economic challenge leading to the conclusion that it is not a feasible solution to the problem. Litware is ready to assist Contoso, and the solution that it offered is the Dynamics™ AX system from Microsoft.

Implementing a new ERP System

Considering the recommendation of implementing Dynamics™ AX as the ERP system of choice at Contoso, there is the need to assess the resistance to change in the organization. The majority of employees have worked with the company for more than 14 years, and they are already used to the culture and way of life in the company. This means that Litware, if selected to implement the new system, will be required to follow certain protocols in the implementation.

Change management is the most important in the protocols. The company must create the urgency for change in a process known as unfreezing (Phillips, 2013). This will require Litware to communicate with all employees and communicate to them why the change is required. The employees must be trained on the use of the new system and they must also be informed of the impact that the new system will have on their company, their duties, and their jobs. This will help in dealing with all the challenges that may result from the opposition or resistance to change.

The second process is the implementation of change in the organization. This requires the company to roll out the implementation of the new system through piloting the program in the organization and seeing how it impacts the employees. It also needs to be phased out implementation where the implementation happens in bits. Arguably, this should ensure that operations in the company do not come to a stop over the period of the implementation and lastly, it requires ensuring that all persons are put on the board in the full implementation of the Dynamics™ AX. It is important to ensure that by the time the implementation process is complete, all the employees understand its implications.

The last major important step in the implementation is the freezing of the change and ensuring that it is part of the systems at Contoso. This will require some monitoring and control of the new systems at work in the organization and while at it, Litware must ensure that how the system works is fully understood by all employees in the organization. The process would guarantee the minimization of resistance and optimization of the productivity of the employees of the entire period of the implementation. In all, the implementation of the new system must involve skilled personnel licensed by Microsoft to do so and at the same time ensure that after implementation, the system is left under the care of competent staff in the information and communication technology department.

References

Luszczak, A. (2016). Using Microsoft Dynamics AX: The New Dynamics ‘AX 7.'Berlin: Springer.

Tavana, M. (2012). Enterprise information systems and advancing business solutions: Emerging models. New York: IGI Global.

Phillips, S. S. (2013). Control your ERP destiny: Reduce project costs, mitigate risks, and design better business solutions.  London: Street Smart ERP Publications

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