How to Effectively Use Your CRM System to Craft a Winning Email Strategy

If you’re in the business of marketing, you realize that email marketing is still one of the most effective ways to reach and communicate with your customers online.  Most business owners recognize the importance of email marketing, and usually attempt to set up an email marketing program.

So let’s take an example of a company that wants to engage in email marketing, but doesn’t have a CRM system. Typically, the first thing that comes to mind is to use their contact manager, such as Microsoft Outlook, to send outbound email messages. However, once they start to send emails to more than a few hundred individuals, they run into problems. Deliverability of the emails diminishes, Internet service providers begin to prevent them from sending large blocks of emails and block their address, and the server’s bandwidth starts to choke (resulting in significant slow downs). Further, if they want to personalize the email, such as “Dear John”, they will not be able to achieve this.

It’s at this point that business owners decide that they need to use a better tool to send their emails. Let’s now assume that a business is using NetSuite’s CRM. Here are some of the advantages of using NetSuite’s combined CRM and ERP for email marketing.

  1. All Customer Information In One Place – NetSuite provides THE central database for customer information. In other systems, the customer’s personal information may be one system, and their sales orders would be on another. In NetSuite, all of the customer’s information is located in one system – and that means that you can schedule emails based on both the customers data, as well as their purchase history. This provides a business with a more strategic and tactical approach to emails, allowing them to know when to send different types of emails based on where the customer is in the sales conversation.
  2.  A More Cost Effective Solution – The NetSuite email marketing tool is good for companies that have a modest amounts of leads, and have relatively complex email reporting/distribution requirements. Standalone bulk email solutions like ExactTarget and Silverpop charge per send or per send package are none to be more economically if you are sending millions of email per month.  But they are weak in that they are not connected to the business data.
  3. Bringing More Employees Into the Conversation – When businesses use Outlook for their email marketing, one of the severe disadvantages is that the conversations remain personalized in the senders inbox. When using NetSuite’s email marketing tool, multiple employees can enter into the conversation, track the progress of email sends, and make suggestions for customer interactions – not to mention track clicks, open rates, etc. Another feature is that the sales team can also continue to attach information to different leads – such as who has converted from a lead to a prospect and finally to a customer. That customer then is segmented into a different email list within the CRM.

The company that continues to use Outlook without converting to a CRM is at a disadvantage against their competitors. When combining a CRM with an email marketing tool, your business becomes more effective at communicating with your customers, which leads to better business, and more revenue.

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Getting the Promised NetSuite Value

cloud computingIt can happen to any business that uses ERP / CRM software, and NetSuite is no different: you feel you are not getting the promised value.

In general, users or businesses are challenged when they are not getting NetSuite to do whatever it is they want NetSuite to do.  Most often, the software is used as an excuse for a weakness in a business practice issue.  Old practices may not work with a tool like NetSuite which has been designed to accommodate and integrate streamlined processing flows.

NetSuite’s nature is real time.  This means that at any point in time, the system can provide you status on any question you have in your business.  But this only is true if you have practices that ensure that the system can provide trustworthy information.  NetSuite supports powerful practices but weak ones can lead to breakdown in several departments.

Employees Don’t Trust the System

The most common challenge encountered with businesses that ship product is when employees question the inventory numbers within NetSuite.  They don’t trust the system and hence they develop a number of counteracting, “check and verify” processes.  For example, an organization may not be using purchase orders to buy inventory.  Hence they may not be using receivers to check-in inventory to stock.  These functions work to predict when inventory is due to arrive and increase the inventory balance upon receipt.  When goods are shipped, inventory is diminished and the overall balance decreases.  If you are not tracking the inventory receipts, you will have a negative inventory balances.

A negative balance in inventory leads sales people to not trust the inventory on-hand number. Sales people will call into the inside sales team or the customer service team to make inventory level inquiries.  But these folks don’t trust the system either so they call the warehouseman down on the inventory floor to determine what the balance is.  This communication goes upstream to the original sale person who then insists that the warehouseman creates an allocation or reservation on the inventory that is there.  Soon, the warehouseman says that he needs a reservation system because all these inquiries are coming at him and he feels out of control.  The customer service team feels they need a better inquiry tracking system including complaint tracking because of the negative calls.  Management looks as this and says, “This is just a mess and the system is broken!”.

Before You Blame the System, Consider This…

NetSuite is a highly integrated and fully relational product. That means that one problem will likely affect other parts of the business.  Is NetSuite responsible for not using the Purchase Order system as it was designed?  You say, “But wait, NetSuite should not have let us use inventory without purchase orders!”. Perhaps.  Perhaps not.  NetSuite can be configured to allow vendor bills for goods purchased and this may or may not have impact on the inventory balance.  Would not it be better to say that the business does not have a solid practice to create purchase orders and receivers that allow NetSuite to keep the inventory in balance?  Does the negative inventory balance reveal that the practices are not aligned with the way that the software was designed?  We think so.

Management may want to blame NetSuite; if they just had a better ERP system, they wouldn’t be in a mess. However, if they had used the system properly as designed, they would find they would get the value that was promised.

How to Solve Common NetSuite Challenges

The first step to solve a NetSuite challenge is to fully diagnose the problem. This typically requires study by an individual or team who knows business process flows and can understand the core of the malfunction. Once the root problem is discovered, steps are taken to develop new practices that will utilize the tools the way they were designed.  This may include an assessment of the effort to clean up whatever is needed to run smoothly.

The best way to prevent a common NetSuite challenges is to have good implementation. There are many users who implement NetSuite by themselves.  See this article about “Implementing NetSuite without a Partner? Exercise Caution!“  While going it alone is possible, it is also a risky proposition, because there are many moving pieces that come together with NetSuite’s integrated system – sales, marketing, orders, shipping, invoicing, cash receipts, etc.  A misstep in one area, as we have seen, leads to a breakdown in other areas.  To prevent this from the start, it is important to bring on a NetSuite expert that can plan the implementation properly to ensure processes run flow smoothly. In essence, this is getting people to coordinate effectively, and establishing the best way to use NetSuite’s integrated system.  If you take proper steps to make sure that everyone is working in a coordinated, deliberate, and purposeful fashion, you will avoid blaming your ERP or CRM system and get the promised value.

Copyright © Marty Zigman 2012

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How NetSuite Integration with Drupal Saves Your Team Time and Money

cloud computingNetSuite integration with Drupal is coming up more frequently. This conversation is usually centered around the ways in which Drupal connects up to NetSuite using Drupal forms, contacts, and data between the NetSuite system.  Since NetSuite is not typically known for  being a content management system (CMS), let’s look at the ways in which Drupal users have been interested in hooking up to NetSuite.

  1.  Single Sign On:  The goal here is to create a single data environment versus silos.  For example, there are businesses using NetSuite for their ecommerce, but they also have an entire community forum which is built on Drupal.  The  business would like the community user to be able to use their same NetSuite username and account details that they have stored in NetSuite. This credential data, in turn, makes it easier to translate customers into active community members.
  2. Lead Submission Forms:  It’s often the case that there are lead submission forms from a Drupal site that later need to be sent via email in a CSV or some other excel document to a CRM system. But with a NetSuite to Drupal integration, it is possible to connect up NetSuite using Drupal based forms, which in turn are collected as a lead in NetSuite’s CRM. This is a powerful way to start synching up different parts of the business, while also allowing the Drupal platform to continue performing by generating leads outside the NetSuite system.  Here is an Open Source Lead Submission project that can help you get started.
  3. Case Management Tools:  Because NetSuite is a highly integrated CRM and ERP system, the need to switch help desk tickets over to NetSuite from Drupal will save the entire team time and money.
  4. Connecting NetSuite’s Inventory and Shopping Cart: Hooking up Drupal to this NetSuite information will allow your system to be a Drupal based ecommerce site.
  5. Connecting to NetSuite Saved Search technology: This solution allows you to query specific areas of NetSuite which may be relevant to show information in Drupal.   For example, if we wanted to show the Case Management tracking queue as noted in the Item #3 above, we can show help desk tickets to the community where the conversation is being maintained.

All of these are good examples of the ways in which NetSuite integration with Drupal is being used to help grow a business.   As you can see, the direction is Drupal to NetSuite, not the other way around.  Next let’s look at how these processes are being accomplished.

PHP Toolkit: This API has been perpetually beta.  It is the default connection option but there are some limitations. I have tried to use the toolkit in the past, but not without some challenges.   Those is the PHP Drupal community may find creative new ways to use it.  This method is effectively leveraging NetSuite’s SuiteTalk which I have previously written about.

 IFrame:  Instead of the heavy web services approach, why not use an HTML IFrame?   NetSuite has a built-in mechanism to host a web based form on another site by using an iFrame.  The trick is to format and make it look like the page is hosted natively within Drupal.  When the Drupal user submits the form, they are  actually submitting directly into NetSuite site.  Snap!

RestLet: This is currently in NetSuite beta, but when it is widely available, it will be perfect as a more powerful tool for integration. There are exciting new areas for innovation with Drupal that NetSuite’s Restlet will allow.

These are some of the ways that my team has started to see NetSuite and Drupal integration, and I believe that we’re going to see a lot more moving forward.  Content management systems, like Drupal, really need to be part of the entire NetSuite ecosystem to drive a great customer experience.

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NetSuite Restlet Sample Program Exploits New Power

NetSuite’s new Restlet API is promising for developing external software applications that interact with NetSuite’s rich data and business functionality.  For example, imagine a large professional services organization that needs to track timesheets in the NetSuite Advanced Projects module.  Most professionals are highly mobile.  Instead of logging into NetSuite to do your timesheet via a web browser, imagine a small iPhone or Android app that allows you to quickly enter data.  Restlet is the key to make this happen without making a big investment.

This article illustrates how to connect up and create timesheet entries from a Linux Perl program.  This example should help bridge the key concepts to hook up to NetSuite through the new Restlet API.  The article assumes you have a good understanding of how to create and deploy scripts in the NetSuite environment.  The example consists of three files:

  1. restlet.js: NetSuite program to receive an insert time entry request.  It validates data and produces information in the execution log.
  2. timebill.pl: Perl program that reads timesheet entry data from timebill.csv file.  This file has hard coded NetSuite credential information.
  3. timebill.csv: tab delimited file in the following format: Date <tab> Client: Project <tab> Task <tab> Time in Decimal format <tab> Memo <newline – for new record>

Step 1: Deploy restlet.js

After enabling the NetSuite Restlet API create a new NetSuite Script as type Restlet.  Set it up with the following parameters:

  • Post Function: “CreateTimebills”
  • Deploy the function with a Log Level of “Debug”
  • Get the External URL.  In our case, it was “https://rest.netsuite.com/app/site/hosting/restlet.nl?script=73&deploy=1 “

Here is the restlet.js code:

function CreateTimebills(datain)
{
 var output = '';
 //nlapiLogExecution('DEBUG','createRecord',(typeof datain.timebill));
 var msg = validateTimeBills(datain);
 if (msg)
{
var err = new Object();
err.status = "failed";
err.message= msg;
return err;
}
var timebills = datain.timebill;
for (var timebillobject in timebills)
{
var timebill = timebills[timebillobject];
var trandate = timebill.trandate;
var customer = timebill.customer;
var casetaskevent = timebill.casetaskevent;
var hours = timebill.hours;
var memo = timebill.memo;
var timebill = nlapiCreateRecord( 'timebill' );
timebill.setFieldValue( 'trandate', trandate);
timebill.setFieldText( 'customer', customer);
timebill.setFieldText( 'casetaskevent', casetaskevent);
timebill.setFieldValue( 'memo', memo);
timebill.setFieldValue( 'hours', hours);
var timebillid = nlapiSubmitRecord( timebill );
nlapiLogExecution('DEBUG','Timebill ' + timebillid + ' successfully created',timebillid);
}
return;
}
function validateTimeBills(datain)
{
var timebills = datain.timebill;
var returnMessage = "";
for (var timebillobject in timebills)
{
var timebill = timebills[timebillobject];
var trandate = timebill.trandate;
var customer = timebill.customer;
var casetaskevent = timebill.casetaskevent;
var hours = timebill.hours;
var memo = timebill.memo;
if (isNaN(nlapiStringToDate(trandate)))
{
returnMessage += "Invalid date: '" + trandate + "'\n";
}
if (customer == '')
{
returnMessage += "Customer entry cannot be blank.'\n";
}
if (casetaskevent == '')
{
returnMessage += "Case Task Event entry cannot be blank.'\n";
}
if (hours == '')
{
returnMessage += "Hours cannot be blank.'\n";
}
if (memo == '')
{
returnMessage += "Memo cannot be blank.'\n";
}
}
if (returnMessage)
{
nlapiLogExecution('DEBUG','Validation Error',returnMessage);
return returnMessage;
}
}

Step 2: Edit timebill.pl

Edit timebill.pl with your specific NetSuite account ID, username, password, and role.  Here is the code:

#!/usr/bin/perl
use strict;
use warnings;
use LWP::UserAgent;
use HTTP::Request;
use HTTP::Headers;
my $inputfilelocation = "timebill.csv";
my $scriptdeployment = "https://rest.netsuite.com/app/site/hosting/restlet.nl?script=73&deploy=1";
my $account = "TSTDRV365788";
my $email = "developer\@prolecto.com";
my $password = "<my-password-here>";
my $role = "15";
my $jsonString = &getJSONStringFromFile($inputfilelocation);
my $result = &submitRestlet($account, $email, $password, $role, "POST", $scriptdeployment , $jsonString);
print $result;
exit;
sub submitRestlet ()
{
(my $account, my $email, my $password, my $role, my $method, my $deploymentURL,my $request) = @_;
# define the HTTP header
my $objHeader = HTTP::Headers->new;
$objHeader->push_header('Authorization' => "NLAuth nlauth_account=$account, nlauth_email=$email, nlauth_signature=$password, nlauth_role=$role");
$objHeader->push_header('Content-Type' => 'application/json');
# make the call
my $objRequest = HTTP::Request->new(
$method,
$deploymentURL,
$objHeader,
$request
);
my $content = "";
# deal with the response
my $objUserAgent = LWP::UserAgent->new;
my $objResponse = $objUserAgent->request($objRequest);
if (!$objResponse->is_error)
{
return $objResponse->content;
}
else
{
return $objResponse->error_as_HTML;
}
}
sub getJSONStringFromFile()
{
(my $inputfilelocation) = @_;
open (FILE, $inputfilelocation);
my $output = "";
$output = qq{
"timebill":[
};
while (<FILE>)
{
chomp;
(my $trandate,   my $customer, my $casetaskevent, my $hours, my $memo) = split("\t");
$output .= "{";
$output .= qq{
"trandate":"$trandate",
"customer":"$customer",
"casetaskevent":"$casetaskevent",
"hours":"$hours",
"memo":"$memo"
};
$output .= "},";
}
close (FILE);
chop($output);
$output .= qq{
]
};
$output = "{$output}";
return $output;
}

Step 3: Create Timesheet Entry Data

In timebill.csv, create some data as input to insert as NetSuite timesheet entries.  Here are a couple sample entries.  Note the clients: projects, and tasks must match what is in already in NetSuite to work:

12/05/2011        SmartTech : Test Project 005      Test Task 005 (Task)     .75        Meeting on Specifications
12/05/2011        SmartTech : Test Project 005      Test Task 005 (Task)     1          Meeting with Management

The timebill.csv file should be placed in the same local directory as timebill.pl.

Step 4: Execute timebill.pl

Now you can run timebill.pl to see the program work.  If all goes right, it will take a few moments and return a code.  Go to the NetSuite script deployment log and see if the timesheet entries were created.  If so, check the timesheet system to find the new entries.

This article should help you kickstart your restlet system into a working prototype.  Stay tuned as we will be writing another article on how we are using restlets to create an Android / iOS app.

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NetSuite’s API Allows Customers to Invent with Software and Make More Money

cloud computingAPI. You may hear this acronym thrown around a lot – whether in business reports, in a management discussion, or when reading an article. But what is an API? API stands for application programming interface. A piece of software that has API means that the application has a mechanism that allows it to be manipulated, and thus enhanced, modified, integrated, used, etc by creating more software to run with it, against it, and around it. Generally, a software API is a capacity that allows you to “bend” the software to adapt to your unique requirements.   Not all business applications have an API – in fact, the makers of the program have to be deliberate in order to publish an API in their business software design.

One of NetSuite’s strengths is that it has a robust API that allows for it to be enhanced. Oftentimes, customers just use software – but rarely invent with it. That means that they are not thinking of new ways that their system can help make them more money. But NetSuite’s API allows businesses to invent with the software – and I have helped businesses grow over the last few years using this capacity.

In general, there are two different ways that you can modify NetSuite:

  1. Inside NetSuite
  2. Outside NetSuite

Inside NetSuite

SuiteBuilder: NetSuite has a whole environment for users to modify the system internally that does not require one to be a software developer.  Inside the system, users can create new ways for data to interact. For example, you can create new database fields and database tables, and then craft the way you want the data to interact. This can lead to software that better fits the business and allows you to enhance your reporting.

SuiteScript:  For those more proficient in writing code, NetSuite also has the ability to allow for scripting, all based in the ever popular JavaScript language. NetSuite’s API allows you to create specialized business logic based in software objects and methods that are used to drive the NetSuite environment. These methods are used to look up, create, and validate data with native NetSuite tables and fields.

Suitelets:  The NetSuite Suitelet function allows you to create brand new user interface forms, drawing elements that go beyond the standard form builder. Here, you use SuiteScript to draw complex user forms that go beyond the SuiteBuilder point-and-click capacities.  With my team, we developed a powerful product extension for a phone company using this API.

SuiteFlow: NetSuite has a workflow engine in its environment.  It is designed for people who are non-programmer types.  Through a visual editor, you can design forms, approval flows, record status, send emails, and direct the flow of information.  The intriguing aspect of this mechanism is that it was possible because of the richness of the underlying API.  In essence, a pretty editor was placed on top of the native programming mechanisms.

Outside NetSuite

SuiteTalk: In a recent article, I discussed SuiteTalk and its capacity to allow NetSuite to work with external systems. In general, this is called web services, and is capable of moving data in-and-out of the system, as well as produce certain kinds of business events.

Restlets:  NetSuite’s API has grown to include REST, which is currently in BETA form. REST is a very popular tool for creating powerful, interactive websites – and it will soon be available to be used with NetSuite.  In essence, NetSuite just extended its API to the rest of the world in a lightweight and easy-to-use format.  With a senior member of my team, we are currently developing some applications with the new API and it looks promising.  We intend to create an Android / iPhone business app and REST will be our choice technology.

NetSuite’s API continues to innovate and respond to the changing software landscape.  This is important so you company will be able to develop competitive advantages.   It’s one distinguishing capacity from other CRM, ERP, and eCommerce platforms.  In the hands of the right people, it can be a competitive weapon.

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A Pinto vs a Ferrari: How to Drive NetSuite Full Speed

cloud computingThere’s no doubt about it: NetSuite is an extremely powerful software system.  As a fully integrated ERP and CRM system, NetSuite is like a Ferrari compared to most business systems.  But is it possible that your current business system is like a Ford Pinto, and not a Ferrari? How would you know?

When we talk about Pintos, we usually think of cars that are just slow and adequate. Yes, they do work – but that’s about all you can say about them.  Similarly, look at your current business system and ask yourself:  is my software allowing me to take full advantage of my business? With a Pinto-like system, your business’ growth will be choked and stifled. The limitations of individual CRMs, ERPs, spreadsheets and so forth are costing you lots of money, without giving you growth opportunities.   I will present some examples below.

NetSuite is similar to a Ferrari — A high performance machine that, in the hands of the right people, can allow you to take full advantage of your business.  A NetSuite system is a fully integrated CRM and ERP system that takes complete advantage of the strengths in your business model and can be adapted to your unique requirements.   With a Pinto, you may be stuck at a top speed of 65 mph. But with a Ferrari, you are capable of much greater speed.

The NetSuite User – Driving a Ferrari like a Pinto

So, now that you have a Ferrari, you need to know how to take advantage of it. The problem is that your business may still be acting like its driving a Pinto. Why does this occur?

Often, the problems that I have observed around NetSuite revolve around implementation.  If a company selects NetSuite, but fails to do a proper job of implementing the system, they will have spent a lot of money without taking full advantage of the system.   In the cases where employees are not clear how to powerfully use NetSuite, they default to just getting by.  For example, they may not be using purchase orders to buy goods; so when they get a vendor invoice as a request for payment, they manually look up the old paper invoices to check the last pricing.  That is a Pinto move.

Here are some common NetSuite Pinto moves I witness:

  1. Data is maintained in spreadsheets when they easily can be accommodated within NetSuite.
  2. Employees use email to each other to make inquiries versus looking up data themselves.  This is especially acute on order status and inventory availability.
  3. In service companies, billing is done by asking project managers if they are ready to bill – versus leveraging billing schedules.
  4. Product returns are not being managed with NetSuite’s Return Authorizations  - instead, a manual receiving system is developed to track inbound shipments.

Do any of these apply to you?  Do you intuitively know you can get more from NetSuite?  It’s time to ask yourself how much time, labor, and money may be wasted because you haven’t leveraged NetSuite’s capacities to streamline your operations.

This is where consulting a NetSuite expert is critical.  A NetSuite expert will understand your business concerns, as well as how to educate employees on its usage, and allow NetSuite to be taken out of first gear and kicked into fifth.  Read my article on NetSuite implementation to learn how to take advantage of a NetSuite system.

The moral of the story is that NetSuite is like a Ferrari, and should be used like a Ferrari.  One sure way to waste money is to pay the price of a Ferrari and drive it like a Pinto.  Get help.

 

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What to Look for When Switching Out Ecommerce Systems

cloud computingIf you’re looking to make the switch to NetSuite eCommerce, or to any new eCommerce platform, you may be asking some questions.  Chief among them being:  ”if I switch eCommerce systems, what are some of the migration challenges?”.

Switching ecommerce platforms is essentially no different than changing any software platform – except for one difference.  With ecommerce, your system is customer facing.  When anything is customer facing, we want to present ourselves very well.  Bugs and poor usability are not tolerated else we negatively impact revenue generation.

To answer this question broadly, the concerns about switching are first dependent on the capabilities of the old system.   For example, the old system may have a special data tracking capacity or a fulfillment process that is unique to you and will need to be migrated over.

Here are some specific areas to review:

  1. SEM and URLs – If a company has done a good job at using Search Engine Marketing (SEM), it’s possible that there will be several URLs scattered across the internet that are currently ranking highly in Google or other search engines.  In order to not disturb the rankings,  most are unwilling to touch the links.  When migrating, it is important to catalog these links  to make sure you don’t lose ranking.  In many cases, you can use the fact you are switching to reevaluate your SEM strategy and improve your rankings .
  2. Continuity programs – Some ecCommerce systems have built-in recurring billing for a product or service. These kinds of continuity programs must be maintained when using the new NetSuite ecommerce system so that the transition is seamless for the user.
  3. Account Names and Shopping Carts – When using the old system, it is inevitable that there will be account names and saved shopping carts. When making the switch to a NetSuite eEommerce world, it is important to make sure that all the data from the account and the shopping carts are transferred so that the customer experiences shopping the same way they did before – now with improvements.  This means that customers should still be able to log in with the username and password as well as access their saved shopping carts.  This sounds easy but can be technically demanding to migrate.
  4. Reviews and Ratings – Customers have written reviews on specific products which have produced good value to your selling system.  It’s important to continue using these ratings and to make sure they are not lost in the shuffle.
  5. Transactional Email Communications – Most eCommerce systems generate emails to customers about their orders.  NetSuite is no different.  It usually is easier to recraft the email using NetSuite tools versus trying to port the mail over.

When planning to migrate your eCommerce system, these are some of the areas to contemplate to get over to the new environment. The same goes with planning a switch to NetSuite eCommerce.  Each assessment needs to be worked out in order to migrate the data, test and activate.  See our article: “How To: NetSuite Implementations Demystified”.

Migrating an eCommerce system also means addressing the following general data structures:

  1. Product Master
  2. Customer Master
  3. Inventory Management
  4. Pricing Logic
  5. Payment Processor
  6. Customer Support
  7. Order History
  8. Related Descriptive Content

These structures are fundamental.  One of NetSuite’s great capacities  is that most of these structures are being used for internal operations and we truly can achieve a single version of the truth because of the inherent integration of NetSuite eCommerce to inventory management, CRM, and ERP.   When thinking about migrating to NetSuite’s eCommerce, we are effectively thinking about migrating our internal operations as well; and this may mean that we first work on the internal operation so that it is working well to make eCommerce activation relatively simple.

Are you planning an eCommerce migration?  If so, what concerns do you have?

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A Primer on Rights and Royalties Management Solutions

cloud computingRights and Royalties – if you have ever dealt with the management or distribution of certain kinds of intellectual assets, then you have probably heard of these terms. While rights and royalties are not exclusively the domain of intellectual assets, for the purposes of this article, we will deal with them as such.

We will use films as our example.  For those in the business of distributing films, rights and royalties are a primary concern.  Film distributors collect movie distribution rights from various producers.  As the company goes out into the market place and produces distribution deals, they develop royalty concerns.   Rights to distribute films are typically specified in terms of “what”, “to whom”, “where”, “when”, and “how”.  Let’s look at an example.

The rights to show a film on DVD, in a theater, or via online streaming, are sold to particular individuals or companies who will try to profit from  showing  the film to end customers.  Different deals are made for different formats.  A deal may stipulate that a film can only be distributed on DVD in the US, or in the European market.  Another deal may specify streaming rights available in the Asian market.  These deals are always set for a  specific amount of time – such as a year.   Another aspect of the right to distribute could be exclusivity versus non-exclusivity. Certain rights derive different prices –  exclusivity will almost always drive a higher price.

Now, there are two tracking challenges in this model:

  1. Inventory  – As a distributor acquires more rights to more properties, the kinds of deals made can be complex which can easily lead to confusion. For example: a distributor does a streaming deal for a certain number of films in Asia and another in North America, and one is for one year and the other for two years. Then, someone comes to them and asks to do a deal in the US and you are not sure.  Hence, inventory in this environment is about remaining available rights that have not been sold off.
  2. Rule Checking – As you do deals, the variables can be complex.  One film may have been distributed in different ways to many markets.   With all good intention, you may find that you agree with a buyer on a deal term but then you realize that you broke a rule because of previous struck deals.  Rule checking can become cumbersome as deals are typically specified in legal contracts and may not be well organized.

What’s needed here is a good rights management system which will help reveal where there is extra inventory and where you may be breaking rules.  For example, if you try to craft a deal in Canada, the system will reveal if the prospective deal is possible. Or if a distributor wanted to conduct a DVD deal in Germany at the same time that he has a deal in Europe, the rights management system will inform the user that the deal isn’t possible – because the rights have already been sold.

Now royalties.  The goal of distribution is to get sell-through.  Meaning, distributors have an obligation to pay the producer as the content is ultimately consumed.  These deals can look any which way.  Up front deals specify monies paid in advanced for the right to distribute.  Certain promotion expenses may apply to address the need to build demand.  Other management fees may need to get paid first before the distributor can realize any profits.  Back end deals specify monies due upon actual revenue generated from end consumer consumption.  All of this leads to a lot of transaction tracking and number crunching to ultimately determine the royalties due to the original producers.  The number crunching is everywhere because the rights deals may specify many parties.  It’s no wonder that royalties are typically paid quarterly — the task is daunting!

Generally, when the distributor gets started with a few titles, they track this kind of information in spreadsheets.  But when there are fifty or more different titles, and there are fifty different spreadsheets – well, keeping track of this can become a nightmare.  Once in this situation, it’s  time to look for a rights and royalty management system. These systems are sophisticated because they manage parameters around what you acquire, who it was sold to, to whom the royalties are owed, and more. In essence, the system helps maintain order over sales, and helps take care of obligations. If any producer comes back with questions about the reliability of a distributor’s royalty calculation, they can rely on their solid tracking system for proof.

While these systems can be both challenging and expensive, they are needed to grow the business else costs get out of control.  Most are not full-blown financial systems so they typically need to be connected to a good general ledger, accounts payable, and accounts receivable system, like NetSuite.  Most of these rights and royalty systems require a significant amount of planning to adopt.  The good news is that you can move titles and rights deals over slowly.   Ultimately, adopting this software leads to more revenue, and lower costs.

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Expand your Visibility into Resource Capacity and Future Revenue via NetSuite’s Advanced Projects

cloud computingNetSuite’s Advanced Projects module is for growing professional service organizations.  What most will not see is the power of planned time entries to project future revenue flows.  As you use Advanced Projects to track project economics, the task structure and the resources assigned represent a powerful capacity to see how revenue will be earned over time.  By working with the availability percentage, and a resource’s work calendar, NetSuite will spread planned time entries into the future in a straight-line fashion.   These planned time entries can be summarized by week, or month, suggesting how revenue will be earned which can provide insight into future cash flows. Here are key considerations:

NetSuite’s Advanced Projects module is for growing professional service organizations.  What most will not see is the power of planned time entries to project future revenue flows.  As you use Advanced Projects to track project economics, the task structure and the resources assigned represent a powerful capacity to see how revenue will be earned over time.  By working with the availability percentage, and a resource’s work calendar, NetSuite will spread planned time entries into the future in a straight-line fashion.   These planned time entries can be summarized by week, or month, suggesting how revenue will be earned which can provide insight into future cash flows. Here are key considerations:
1.  Planned time entries adjust automatically as actual time is entered via timesheets or task dates are changed.  This means that project managers need to actively assess the expected total work remaining relative to the actual work recorded.  Most mature service organizations will perform this assessment weekly.
2.  There is a limited amount of shaping possible on how the time will layout into the future.  NetSuite’s project model is good for project economics.  But if you need high precision in tasks, dependencies, and schedule, we recommend you use Microsoft Project, or similar.
3.  For a single task, if you make availabilty too tight, NetSuite may complain it can’t make enough planned time entries by day.  In this case, break the task into smaller segments.  Manipulate the task / resource availabilty metric to let NetSuite project the target end date.
4.  Leverage NetSuite’s new pivot function to get powerful views.  For example, to see how project will land in monthly buckets, use formulas to get planned time entries dates month numbers and then crosstab on that number to see each month.NetSuite’s Advanced Projects module is for growing professional service organizations.  What most will not see is the power of planned time entries to project future revenue flows as it is not offered as a canned NetSuite report.  As you use Advanced Projects to track project economics, the task structure and the resources assigned represent a powerful capacity to see how revenue will be earned over time.  By working with the resource’s availability percentage on a task, and a resource’s work calendar, NetSuite will spread planned time entries into the future in a straight-line fashion.   These planned time entries can be summarized by week, or month, suggesting how revenue will be earned which can provide insight into future cash flows.  Here are key considerations:

1.  Planned time entries adjust automatically as actual time is entered via time-sheets or task dates are changed.  This means that project managers need to actively assess the expected total work remaining relative to the actual work recorded.  Most mature service organizations will perform this assessment weekly.

2.  There is a limited amount of shaping possible on how the time will layout into the future.  NetSuite’s model is good for project economics.  But if you need high precision in tasks, dependencies, and schedule, we recommend you use Microsoft Project, or similar.

3.  For a single task, if you make availability too tight, NetSuite may complain it can’t make enough planned time entries by day.  In this case, break the task into smaller segments.  Manipulate the task / resource availability metric to let NetSuite project the target end date.

4.  At the time of this writing,  NetSuite’s new pivot function (in beta) appears to not work against time entries.  To see how project revenue will be earned in monthly buckets, we can use formulas to get planned time entries, dates, month numbers, and then cross-tab on that number to conveniently see a revenue forecast.  For now, it is best to export this Saved Search information to Excel and use a Pivot.

If you are seeking to expand your visibility into resource capacity and future revenue via NetSuite‘s Advanced Projects, let’s start a conversation.

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How NetSuite Outperforms Salesforce.com for Generating Revenue

cloud computingMost business people see software as a necessary element in doing business in today’s competitive environment.  What they will likely not see is the different ways business software opens capacity to be more competitive.   There are two major philosophies that drive the way business software is organized:

1.     master data; versus

2.     transactions data.

This article will contrast Salesforce.com, which is organized around master data, and NetSuite, which is organized around transaction data.

Master data is information in a system that is static, or rarely changes. In a CRM environment, like Salesforce.com, key master data is information such as contacts, name, addresses, titles, phone number, and company information. Given that this data usually doesn’t change, it is used primarily as building blocks for transaction data. In an ERP environment, such as NetSuite, the system has master information on customers, suppliers, employees, and other business partners. There is also information on product data such as the description, price, attributes, categories, relationships to other products, as well as inventory balances.
It’s important to distinguish master data from transaction data.  Conceptually, transaction data represents the commitments made by the people in the business to move things around, act, and to change people’s situations. It usually represents the promises we make to one another. The most typical transaction will look like a sales order. A customer, who is stored as a record in our master data, wants to purchase a good (also stored in the master record). When the customer commits, the company produces a sales order that will specify information such as which product, the quantity, the payment terms, and the delivery promise. Transaction data is extremely important to the growth of a business – because it is only when transaction data is produced that a company actually makes money. Thus, transaction data is directly tied to revenue, whereas master data is tied to the information that will lead to revenue.
How do you want to organize your business model?  Do you want to organize around master data or transaction data? Indeed, producing transactions performs very well with good master data.  But good master data alone may not make it easy to transact if you systems are not designed with that in mind.  Because transactions are where businesses work on fulfilling commitments, and fulfilling commitments means we are taking care of promises, especially to customers, this can in turn directly affect growth. Assuming equally quality, the question ultimately becomes – do you want more transactions or more master data?
If a company focuses on measuring more transactions, they have a higher likelihood of generating more money. Salesforce.com likes to tell you they are focused on the customer, but they are less focused on transactions — they are more focused on master data.  Yes, it makes sense to know your customer well and this starts with master data; but it ultimately needs to get to transaction else it is not meaningful or relevant.
In contrast, NetSuite is designed around transaction data and increasing transaction throughput. This different focus means that a business can better measure the elements of the business that ultimately underlie growth. NetSuite tracks master data just like Salesforce.com, but it differs in that it is encouraging transaction.  It is well known that if you use Salesforce.com, as soon as a customer makes a commitment to buy your product, you need to jump to another system to manage that transaction.  See this article: “Best-of-Breed Business Systems: Traps & Lies” for another viewpoint.
In summary, NetSuite as a business management platform is fundamentally organized around information structures that drive growth and allow you to measure business performance.  Through the point of view of master data versus transaction data, Salesforce.com can only help you prepare for transaction; but it stops short of producing it.

Master Data is Static

Master data is information in a system that is static, or rarely changes. In a CRM environment, like Salesforce.com, key master data is information such as contacts, name, addresses, titles, phone number, and company information. Given that this data usually doesn’t change, it is used primarily as building blocks for transaction data. In an ERP environment, such as NetSuite, the system has master information on customers, suppliers, employees, and other business partners. There is also information on product data such as the description, price, attributes, categories, relationships to other products, as well as inventory balances.

Transaction Data is Action

It’s important to distinguish master data from transaction data.  Conceptually, transaction data represents the commitments made by the people in the business to move things around, act, and to change people’s situations. It usually represents the promises we make to one another. The most typical transaction will look like a sales order. A customer, who is stored as a record in our master data, wants to purchase a good (also stored in the master record). When the customer commits, the company produces a sales order that will specify information such as which product, the quantity, the payment terms, and the delivery promise. Transaction data is extremely important to the growth of a business – because it is only when transaction data is produced that a company actually makes money. Thus, transaction data is directly tied to revenue, whereas master data is tied to the information that will lead to revenue.

How do you want to organize your business model?  Do you want to organize around master data or transaction data? Indeed, producing transactions performs very well with good master data.  But good master data alone may not make it easy to transact if your systems are not designed with that in mind.  Because transactions are where businesses work on fulfilling commitments, and fulfilling commitments means we are taking care of promises, especially to customers, and this can in turn directly affect growth. Assuming equal quality, the question ultimately becomes – do you want more transactions or more master data?

Transactions Produce Revenue

If a company focuses on measuring more transactions, they have a higher likelihood of generating more money. Salesforce.com likes to tell you they are focused on the customer, but they are less focused on transactions — they are more focused on master data.  Yes, it makes sense to know your customer well and this starts with master data; but it ultimately needs to get to transaction or else it is not meaningful or relevant.

In contrast, NetSuite is designed around transaction data and increasing transaction throughput. This different focus means that a business can better measure the elements of the business that ultimately underlie growth. NetSuite tracks master data just like Salesforce.com, but it differs in that it is encouraging transaction.  It is well known that if you use Salesforce.com, as soon as a customer makes a commitment to buy your product, you need to jump to another system to manage that transaction.  See this article: “Best-of-Breed Business Systems: Traps & Lies” for another viewpoint.

In summary, NetSuite as a business management platform is fundamentally organized around information structures that drive growth and allow you to measure business performance.  Through the point of view of master data versus transaction data, Salesforce.com can only help you prepare for transaction; but it stops short of capturing and measuring it.

Copyright © Marty Zigman 2011

“NetSuiteCRM+.” Photo. Cloud Commerce: Leverage The Cloud – Level the Playing Field. 2009. 02 Nov 2011.        <http://www.cloudcommerce.com/crm/salesforce-vs-netsuite.php>.

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