Sage Automation

IT Objectives

• Substantially enhance financial control and management reporting.
• Deliver a high level of real time exception reporting.
• Improve and integrate payroll processing.
• Streamline project costing to provide totally accurate and up to the moment data to enhance project visibility and management.
• Support and monitor service technician operations.
• Create one information management framework to support growth and a diversifying company operation.

Background

For SAGE, the adoption of advanced IT technology to support its business was very much a factor of substantial and sustained growth.

As founder and Managing Director Andrew Downs, notes, “even in our first year of operation our expansion was explosive by the standards of the day.

“However, that saw us taking a rather ‘head down and tail up’ approach to business. We were technically focussed and totally attuned to delivering what our customers wanted. But, conversely, we did a very poor job in managing our own accounts.

“And so we engaged a bookkeeper, implemented the Quickbooks accounting software and then used a bunch of standalone Excel spread sheets to try to handle everything else”.

However by 1997, when the company’s staff passed the 30 mark, it realised that it needed to adopt a far more comprehensive and integrated approach to the use of computing.

Says Mr Downs, “we were doing far too much ‘management on the fly’ and never really knew exactly where we were.

“For example, there were simple problems like losing a paper based purchase order. We had bills that we didn’t know we had. We were not properly allocating costs to jobs, with some cropping up long after a project had been completed. We were raising job numbers on a spreadsheet, then updating a stand alone job register and then having to re-enter data in into the accounting system.

“So there was every opportunity for errors to occur. But most significantly we were never able to properly make timely forward forecasts. There was always a time lag.

“In short, it was like trying to drive a car by looking in the rear vision mirror. We mostly knew where we had been. But we had far less idea where we were going. A scenario which meant there was a huge potential to impact our profit and the equal potential to put a break on our future growth.

”You cannot manage what you can’t measure and the failure of many businesses is simply because they have big gaps in their data flow”, Mr Downs notes.

In setting out to address such issues, SAGE investigated a range of possible software solutions. A detailed scope of requirements was developed. And as Mr Downs stresses, “our number one priority was that whatever we selected had to be able to manage a business that would continue to rapidly grow. That has proved to be a very wise decision.”

Partnering with Pronto Xi & MDS

After evaluating various ERP options, SAGE elected to install Pronto-Xi with application, implementation and training support from Adelaide headquartered MDS.

“We believed that this would provide the best solution for us. Particularly because that ERP solution could clearly demonstrate its capacity to handle major growth and business diversity”, Mr Downs explains.

“But support was also important.

“No one should forget that successfully implementing a major software package calls for a change in management thinking and approach, some added skills and excellent training.

“If you are going to get optimum results all of those things have to be addressed. You need to embrace process change. And you must have superior specialist support.

“For example, soon after beginning our Pronto Xi implementation we engaged a highly qualified professional accountant, first as an external consultant and then as our internal CFO.

“With his skills and experience, our willingness to be far more disciplined and with advice from MDS, we got our financials working properly and as we wanted them.

“All of our data became fully integrated. Which has been a huge achievement given that, over time, we have continued to add businesses to our Group, staff and operating locations. By bringing everything together we’ve underwritten expansion, with our system supporting everything we’ve done.

“Where previously we pretty much had an ad hoc reporting platform, we now have powerful exception reports that give us an excellent view of the business. They allow us to be far more forward looking and proactive. And they give managers the capacity to run their own departments far more independently, with their own specific KPIs and with an instant on-demand assessment of how they are tracking financially."

As a project-centric company, it is no surprise that collecting all project costs back into the projects has been an essential requirement for SAGE Automation. The successful deployment of this capability in Pronto Xi has created an enterprise-wide benefit for SAGE not only just for managing projects, but also in monitoring Work In Progress, in making projects visible to the management team and also in creating Key Performance Indicators for measurement.

As costs and income are seen in projects as soon as they are recognised, this makes the reporting and monitoring obvious and immediate, a benefit reflected in business decision making.

Outcomes

• All business data is now fully integrated.
• Financials are now precise and timely.
• Real time exception reporting spans the business, giving management the data they need, when they need it and in the form they want it.
• Key information is automatically shared across the company.
• Relevant performance data is available for individual managers so they are now able to far more independently run their departments.
• Totally up to date project costs are available.
• Payroll has been streamlined and integrated to projects.
• New and comprehensive service support has been added in the same system.
• Future growth and diversity is seamlessly catered for.

Further Directions

While SAGE has traditionally produced highly customised solutions to meet its customers’ very specific requirements, more recently it has also begun the contract manufacture of control systems on behalf of third parties.

These call for volume production of standard units. And, as such, the company is currently evaluating the application of Pronto Xi’s broad range of manufacturing capabilities.

Says Mr Downs, “this added diversity means we now need to use IT to streamline production and we are confirming exactly how our software can do that."