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High employment rates and how SME’s can beat the recruitment race using ERP

Low unemployment and your requirement for ERP (Enterprise Resource Planning)

We know that unemployment in the UK hasn’t been so low since the mid 1970’s.  This is great news for the economy generally, but it does make the adage ‘can’t get the staff these days’ ring truer than ever.

We had an interesting meeting with a customer of ours last week who are a long standing user of NAV (now Dynamics 365 Business Central) and the general manager commented that as their knowledge and use of their ERP has grown over the years they have been using it they have been able to rationalise their work force considerably.

As staff have left, they have not needed to replace them as several the tasks that had historically been part of that role have been made more efficient supported by the businesses’ use of Microsoft Dynamics NAV.  Preparing reports for analysis is a prime example.

The business we were speaking with are a ‘people’ business who value their staff as one of their greatest assets but their comment about rethinking their workforce requirements was interesting.

They commented ‘It’s been getting harder and harder and to recruit good people.  There are more jobs than people looking for them now’.

 

Reduce the cost of recruitment in SME businesses with ERP

There is also the cost of recruitment to consider.  ACAS suggests that replacing an employee can cost as much as 30K. ACAS also suggest that retaining and retraining is by far the most cost-effective approach than replacing.

There is an argument therefore for embracing new technology which can then support retained staff to bring businesses efficiencies that result in a smaller head count requirement to run your business profitably.

 

Let’s consider

A manufacturing business who needs to plan production.  This plan needs to consider not just the items of finished stock required to satisfy sales orders (tactical information) but also must consider component parts that are required to make up the finished item (structured information).

To calculate a production schedule manually is a ‘full time job’.  Balancing stock, purchasing requirements, extended lead times, sales orders, human resource and ensuring BOM’s are correct whilst making the necessary changes to them AND communicating a production schedule to the factory floor whilst ensuring you can report on data is not only an onerous task but is open to human error.

Making better use of your SME workforce with ERP

If you consider that the conventional working week is 40 hours,  data reveals that automation will save employees 6 weeks of time per year, and a full 9 weeks of time for business leaders — all of it time that professionals can reinvest into career development and personal growth opportunities.

Forbes

What can SME businesses do to improve staff retention?

Provide staff with access to an ERP that can support them by automating the repetitive, mundane but crucial tasks they perform day in, day out then not only will their time be more productively used but their job satisfaction will increase. Better job satisfaction is argued as relating directly to employee retention.

 

Employee satisfaction is a reliable predictor of employee retention. When employers engage in practices that support good working relationships, employee satisfaction improves because workers tend to believe the company is using their skills and appreciating their service and commitment. In turn, higher job satisfaction generally results in higher levels of employee retention

Work Chron

 

How can Microsoft Dynamics 365 Business Central  ERP help you as an SME in the UK?

Mundane tasks that are prone to human error do not provide your employees with job satisfaction.  These tasks are generally repetitive and prone to human error.

Atychiphobia

The fear of failure (also called “atychiphobia”) is when we allow that fear to stop us doing the things that can move us forward to achieve our goals.

Staff who fear making mistakes and failing in their role are not likely to suggest improvements to processes that make your business more efficient.  They will feel under-valued and unhappy at work.  They will leave.  You will then have to recruit for that most and suffer the associated expense of doing so.

Recruitment pressure will result because staff turnover is higher in roles where individuals feel unfulfilled and under-valued.

We are human and humans make mistakes.  A study in the US suggested:

It costs: $1 to verify the accuracy of data at the point of entry, $10 to correct or clean up data in batch form, and $100 (or more) per record if nothing is done – including the costs associated with low customer retention, and inefficiencies (source: totalqualitymanagement.wordpress.com)

So, you will either be spending time and money checking for human error or suffering the consequences on your bottom line.

 

Effective ERP brings all your business processes together to improve collaboration, help your company make data-driven decisions, and advance business productivity. Look for solution software tools that assist with:

  • Financial management—Improve your control over company assets, cash flow, and accounting.
  • Supply chain and operations management—Streamline purchasing, manufacturing, stock, and sales-order processing.
  • Customer relationship management—Deliver better customer service, while increasing cross-sell and upsell opportunities.
  • Project management—Manage billing and project monitoring to deliver work on time and within your budget.
  • Human resources management—Attract, hire, manage, and pay employees that can help your business thrive.
  • Business intelligence—Offer easy-to-use tools that help you with analysis, reporting, and business intelligence.

Thought for the Day

Dynamics 365 Business Central is ideal for SME’s.  It is scalable and affordable.  From a single user on subscription at £52.80 plus support and VAT (Essentials, which provides Accounts, CRM, Stock Control, BOM and Assembly Orders or £75.40 plus support and VAT (Premium which provides full MRP and Service Management) to 100+ users this solution benefits from constant Microsoft research and development, regular updates is MTD compliant AND is accessible from any internet capable device.

Using an ERP like this one will drive business efficiency and in so doing improve your employee job satisfaction which in turn improves retention rates and lowers recruitment costs.

Contact Qi Ltd to discuss how we can migrate your existing data to D365 Business Central and implement your project in only 8 weeks.