4-page Case Study - Posted 4/5/2010
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Manufacturer Upgrades ERP Solution to Thrive Through Economic Downturn
Aminolabs, a producer of food supplements, invested in Microsoft Dynamics NAV in 2003, but the solution contained many customized features and not all processes were integrated. For instance, the production was not included in the enterprise resource planning (ERP) system. Incorrect stock data regularly resulted in errors in the purchase and production planning, and detailed figures about cost and return of every product were not available.
In 2008, Aminolabs commissioned IT partner NORRIQ Belgium to upgrade the ERP system and to integrate the missing processes. Following an in-depth fit/gap analysis, the two companies implemented Microsoft Dynamics NAV at Aminolabs. Since then, all Aminolabs divisions have been automated within one system and the business has all the numerical data at its disposal to be more cost-effective.
||All the elements we had customized are now standard features, or we simply didn't know they existed. Instead of an upgrade, it turned into a completely new implementation with minimum customization.
||Bart Konings, Project Manager, Aminolabs
Eurofood Belgium NV was renamed Aminolabs in 2006. The company was established in 1993 as a distributor of amino acids but now specializes in mixing and processing. Aminolabs produces a range of food supplements, which are meant to have a beneficial effect on performance and general health for people and animals. The business produces and packages the supplements under orders and under the private labels of various customers.
In 2007, Aminolabs moved to the Research Campus in Hasselt, Belgium, where the company has a modern plant built to accommodate forecasted growth. Today, Aminolabs has 30 permanent employees (in the summer season, the company brings in 10 temporary workers) and a EUR€12 million turnover. Of that turnover, 40 percent of this is generated through trade and 60 percent is made through production for third parties. Over the past few years, Aminolabs's growth has been healthy.
“Aminolabs's success is chiefly thanks to the flexibility we offer our customers. Our expert knowledge and modern accommodation allows us to supply any product in any form: powders, capsules, tablets …. And thanks to our commercial activities, we are able to offer large purchases and sharp prices,” says Bart Konings, Project Manager at Aminolabs.
Need for Technology Upgrade
Since 2003, Aminolabs has used Microsoft Dynamics NAV for the sale, financial management, purchase, and, to a lesser extent, stock management. However, the production process was not integrated. The possibilities of the system were not used to maximum effect and there was no real centralization.
Raw materials were entered, but not the lot numbers or shelf-life date, because paper documents were still used for tracing. Stock figures were not up-to-date, which meant the purchase proposals, calculated in Excel, were not up-to-date either, and the production planning was regularly unorganized. The fact that the commercial division and the production division had no idea of each other’s purchases did not help either.
“The move, the increased turnover, and diversity made it more and more difficult to know how much we had in stock. The result was that the production division ran into delays time and again. We needed a more centralized data management system,” says Konings.
Finished products were entered based on their article number and linked to a recipe, but the different production processes were not entered in the system.
“Because we only knew the raw material cost and not the cost of processing, we were unable to calculate the real cost and return per product. Microsoft Dynamics NAV, at that time, did not generate separate commercial and production figures, making it impossible to evaluate their separate performance,” says Marianne Zwakhoven, Financial Manager at Aminolabs.
|The Aminolabs facility in Hasselt, Belgium, was built to anticipate growth.|
Aminolabs contacted IT partner NORRIQ (still Helios-IT then) for an in-depth analysis and an upgrade of Microsoft Dynamics NAV. Says Konings, “We briefly considered looking at other ERP products, but in the end, we know this program best and the look and feel of the Microsoft Office system guarantees a short learning curve for users.”
From Analysis to Implementation
In August, the fit/gap analysis was launched. This showed that most bottlenecks could be remedied by using Microsoft Dynamics NAV 5.0 to better effect.
“All the elements we had customized are now standard features, or we simply didn't know they existed. Instead of an upgrade, it turned into a completely new implementation with minimum customization. Good news for future upgrades, in other words!” says Konings.
In January 2009, NORRIQ started with the implementation, and on May 1, 2009, Aminolabs went live with Microsoft Dynamics NAV 5.0 SP1.
Added Value of the New Implementation
“The biggest benefits are the central data management and the many extra parameters. All other benefits are a result of no more double input, up-to-date stock data, smarter purchases, more efficiency, and extensive reporting,” says Konings.
The purchase proposals are now generated by Microsoft Dynamics NAV based on correct stock data and taking into account minimum order amounts. In the warehouse, the system automatically gives lot numbers to incoming goods and links them to the supplier's lot number. Every raw material is then given a label with a lot number, shelf-life date, and internal article number. It is then immediately entered in Microsoft Dynamics NAV.
|Aminolabs employees perform extensive product testing in a |
complex technology environment.
The previous software did not have any production features. Today, all recipes and processing plans are known in the system, which means the real cost price per product is also known.
Says Konings, “For production planning, a customized overview was created—a screen on that, at a glance, you can see what the planned production orders are, whether the materials are in stock, and when the ordered goods are expected. Since then, planning has been more correct, which has had a carry-on effect in terms of efficiency.”
Now that the upgraded implementation of Microsoft Dynamics NAV has been live for a couple of months, there is enough numerical data to generate reports and study trends. Says Zwakhoven, “Our employees put a great deal of time in entering new data, which gives us a good overview of the operating costs. We have also implemented KPIs on various levels, which has helped us to increase our productivity by about 20 percent.”
At the start of 2010, Aminolabs began using the customer relationship management feature—which includes contacts, visit reports, and quotes—in Microsoft Dynamics NAV. The company will invest in scanners for the warehouse and the production hall. Currently, the stock is entered at the end of the day; by using scanners, all product data will be immediately available.
Aminolabs is also planning more extensive reporting for business intelligence (BI) with the flexible NORRIQ BI Cubes.Benefits
|Aminolabs maintains high-quality standards with stringent controls.|
“The most important condition for a successful upgrade or implementation is a good fit/gap analysis. NORRIQ provided great assistance in carrying out this mental exercise. The company knows the sector well and, as an external party, offers a fresh look. Everyone needed to be closely involved in this operation because they are experts in their own field. And enough time needs to be taken out to test the system, which is something we didn't do. And finally, good training is indispensable,” summarizes Konings.
Good follow-up is also important after the implementation. The NORRIQ help desk is permanently available for all of Aminolabs's big and small questions, which is very much appreciated.
Aminolabs is very happy with the result. “In times of economic crisis, it's important to keep the finger on the pulse and be cost-effective. We now finally have one centralized ERP system that allows us to gain better insight into our company,” concludes Konings.Microsoft Dynamics
Microsoft Dynamics is a line of integrated, adaptable business management solutions that enables you and your people to make business decisions with greater confidence. Microsoft Dynamics works like familiar Microsoft software such as Microsoft Office, which means less of a learning curve for your people, so they can get up and running quickly and focus on what’s most important. And because it is from Microsoft, it easily works with the systems that your company already has implemented. By automating and streamlining financial, customer relationship, and supply chain processes, Microsoft Dynamics brings together people, processes, and technologies, increasing the productivity and effectiveness of your business, and helping you drive business success.For more information about Microsoft Dynamics, go to:
www.microsoft.com/dynamicsFor More Information
For more information about Microsoft products and services, call the Microsoft Sales Information Center at (800) 426-9400. In Canada, call the Microsoft Canada Information Centre at (877) 568-2495. Customers in the United States and Canada who are deaf or hard-of-hearing can reach Microsoft text telephone (TTY/TDD) services at (800) 892-5234. Outside the 50 United States and Canada, please contact your local Microsoft subsidiary. To access information using the World Wide Web, go to:
www.microsoft.comFor more information about Aminolabs products and services, visit the Web site at:
www.aminolabs.comFor more information about NORRIQ products and services, call 32 (0) 16 498 115 or visit the Web site at: