Faced with competitive markets, volume demands, increasing emphasis on quality and new shipping regulations, recyclers of recovered fiber and other materials increasingly appreciate the value of operating with specialized business software.
These systems are designed to handle the workflow, business processes, documentation needs and other requirements common to recycling companies that collect, pack or broker commodities, helping ownership achieve goals such as increased productivity, improved decision-making and greater oversight of their businesses.
Choosing the right solution is no easy task, however, especially with the numerous offerings in the marketplace and the multitude of features to sort through. As well, trying to compare solutions by cost alone can be a dicey proposition because the upfront costs are typically just the “tip of the iceberg.”
To choose the right software for your business and to avoid some common mistakes, consider these 10 questions before making a final decision.
1.Does the software meet your “core” business needs? It is surprising how often decision-makers get distracted by demo showmanship or bells and whistles and lose sight of whether core business requirements are adequately supported by the software being considered. Choosing the right solution begins with identifying your critical business processes and requirements and separating them from features or functions of lesser importance. Whether it is workflow, documentation, inventory control or accounting, it is important to start with a prioritized list of what you expect the software to do.
2. Does the vendor offer a live demonstration? It’s equally important to make sure that your software evaluation is conducted with one or more live interactive demos that allow you to experience the usability of the system firsthand. Many companies offer group webinars or YouTube product videos, but these may not go deep enough or address your specific needs. It’s also important to include key employees from other departments or groups to get their input on how well the software meets their requirements. Their early involvement also will help build support for the chosen solution later on.
3. Is the system easy to use? Choosing a solution that’s logical and intuitive to work with will not only help motivate your users to accept and embrace it but also will deliver the productivity gains and customer service improvements fundamental to achieving your business objectives. If your staff is left with the impression that the new system is too difficult to work with, their frustration and lack of support can easily spill over into unexpected training and implementation problems. This can potentially jeopardize your productivity goals, making it far more likely that spreadsheets and other manual workarounds may continue to be used.
4. Will it adapt to changing business needs? Buying business software is a long-term investment. It’s important to consider the features you need today as well as those you may need in the future. Many systems marketed to the recycling industry have a tendency to be functionally strong in some areas, such as scrap buy-back or packing plant operations, but may be weak in others, such as material processing, inventory control or brokerage.
Safe and Sound
With the competition in today’s markets and the risk of key employee turnover, it’s never been more important to protect your vital business data against hardware failure, potential theft, malicious acts or accidental loss.
When evaluating recycling software, look for features that will help secure your critical business information, including user definable accounts that can be easily deactivated; automatic password reset and expiration and a user permissions matrix that provides granular control over the assignment of tasks.
For auditing and in some cases Sarbanes-Oxley compliance, make sure the software includes a log that can capture all user activity including record changes and deletions. It also should help identify whether unauthorized users are gaining access by impersonating authorized ones.
Some software companies also offer “cloud-based” backup and disaster recovery services to protect your data. If you use one of these services, make sure you know who is responsible for making (configuring) the backups and recovering data in the event of a failure, how quickly your data can be retrieved and what work might be lost. If there is a premium for the service, be sure to compare it with other offerings in the marketplace.
- David Haber
Determining if a software provider’s support team has the knowledge to meet the increasing demands also is valuable. Start by asking who some of the vendor’s top clients are and what kind of transaction volumes and user counts they have. Learning from their experience can tell you a lot about whether the vendor and its software will be able to the meet new challenges as your company grows.
5. Does the accounting model (really) work? One of the advantages of working with recycling business software is having access to specialized reports, such as gross profit, commissions or inventory, that otherwise would be difficult to get from your accounting system. But relying on these reports also can be a problem if they don’t reflect the sales or purchases reported in your accounting system.
For recycling systems that calculate profit or track inventory costs, it’s important to look at the process of transferring sales and expenses to accounting as well as how easily the accounts being posted to can be reconciled. Otherwise, you may find that the productivity gains in your operation may be eroded by the additional work in your accounting department.
When evaluating software with integrated accounting, ensure it meets your current and potential business needs, has a knowledgeable and robust support team and the support of your accounting staff.
6. How will it provide return on investment (ROI)? For many recyclers, the true cost of introducing business software is not just the license fees or the training costs but rather the commitment of time, dedication of resources and the potential disruption through the implementation process. For these reasons and more, it is crucial to consider what kind of ROI you can expect from your new system.
However, knowing where to look for ROI is not always easy. While ROI is typically measured by comparing the value of reduced labor costs or productivity gains with your software investment, this tells only part of the story because many things beyond productivity can affect ROI.
The following is a list of some typical ROI factors that you should look for in any software solution:
- Eliminating redundancy – Look for features that can help avoid the use of spreadsheets, manual document preparation or other functions that involve duplicate data entry or maintenance
- Avoiding errors – Does the software offer features that can catch user errors, such as incorrect pricing or weights or overpayments to vendors?
- Workflow features – Are there tools that will allow your operation to collaborate better and to improve the tracking of critical business activities, such as shipping status, booking cutoffs or received mill weights?
- Visibility – Consider how increasing the visibility (and central access) of business information might impact productivity and oversight.
- E-commerce – Look for opportunities to tie into data feeds or electronic data interchange (EDI) services to further eliminate manual entry.
- Reducing dependencies – Will the software help introduce standard procedures that make it easier to train new personnel and minimize the use of outside consultants or accountants?
- Mobile access features – Are there mobile device or Web-based apps that can help improve productivity, especially when working remotely?
- Value-added features – Does the solution have features that provide added value to relationships such as a mobile app or Web portal that might also reduce emails and calls from clients?
It’s important to recognize that measuring ROI is not only about reducing headcount (though it can be) but also about the different ways in which it contributes to the growth of your business while also helping to minimize your costs.
7. Who uses the software? Every software vendor provides references, and speaking with them can certainly be helpful. It also is useful to consider what types of companies are using the software and how closely these companies’ business operations match your own. If, for example, none of the vendor’s references are involved with business models or requirements that are critical to your operation, that may indicate a potential gap or weakness to look at more closely.
8. Who’s behind the training and support? No matter how well-adapted a software system is in meeting your business needs, a poorly planned and executed implementation led by inexperienced staff easily can undermine the entire project. In fact, it’s one of the most common root causes of project failure. That’s why it is essential to consider how your implementation will be managed and supported by the software companies you consider.
One of the first things you will want to know is who will be assigned to the project’s training and implementation team and their credentials. How many installations of the software have they done? Does anyone on the team have firsthand experience in the recycling industry outside of working for the software company?
The software vendor’s implementation team is likely to invest a lot of time working with you and your staff to learn about your business and implement the software. Ideally, you’ll want to know whether these same people will have an ongoing role in supporting your account or whether you will end up working with help desk staff that may know nothing about your project.
9. How long will it take to go live? Successful business software projects often will demand a considerable amount of time and effort over the course of several weeks or even months. You’ll have a lot at stake implementing a business system for your recycling company. Before going forward, it’s vital to understand the time commitments and the expectations needed to ensure a successful transition.
10. How easy is it to upgrade the soft- ware? Since the maintenance fees for most business systems likely will include software upgrades, it’s only natural that you will want to take advantage of them, especially as fixes or new features are released that may be of value to your business. It’s important to find out what’s involved with performing a software upgrade, who is responsible for doing it and whether it’s something you can easily do yourself. If you are planning to customize your recycling software, it’s even more important to ask about this because having the system modified can potentially make it much more difficult (and expensive) to upgrade. In some cases, you could be trapped essentially on the version that your modifications were applied to unless they are reprogrammed for a newer version.
Choosing a software system to help manage your recycling business doesn’t have to be difficult, but it’s important to recognize that not every product excels at everything. When you’re looking at solutions, stay focused on what your business really needs today and think about what it might need in the future.
Make sure the partner you choose comes with experience and success stories that are relevant to companies like yours. Most importantly, make sure you understand the value and ROI that a potential business system can deliver. Avoid making judgments solely on cost, because that is usually the surest way to end up making the wrong choice.
Explore the December 2013 Issue
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