Budgeting for Manufacturing and Distribution Companies using Microsoft Dynamics NAV

This article discusses budgeting and forecasting solutions for Manufacturing and Distribution companies using Microsoft Dynamics NAV, zooming in on features and functionalities.

Whether you’re putting together a budget, a forecast, or a what-if scenario for your organization, they all entail historical actuals and projections, so you can plan for managing your specific manufacturing or distribution corporation, maneuvering around obstacles and seizing opportunities in the upcoming period.  There are a plethora of software options for manufacturing and distribution organizations relying on Dynamics NAV that can expand your planning processes, whether you craft your own budgeting solution, rely on native Dynamics NAV functions, or opt for an independent software vendor (ISV) solution.  This article will discuss your best options for today’s budgeting, forecasting, and modeling demands, specifically to meet your manufacturing or distribution planning objectives with Microsoft Dynamics NAV.

Let’s start by identifying some primary characteristics you should be seeking in a planning tool.  This might seem like a given, but ease of use needs to be priority #1.  Ease of use translates to business user friendliness in the form of accounting logic, reusable templates, and an efficient process.  Planning should be business user friendly because it is a collaborative process.  Therefore, collaboration needs to be a focus for any ISV budgeting software you are considering.  The technology should enable you to avoid back-and-forth email conversations with separate spreadsheet attachments that clog your inbox – and instead of merging all of this data together, you can facilitate the teamwork needed for budgeting through today’s software.  When collaborating, you need comprehensive security for all of your sensitive information, like payroll.  Robust security should allow for accessibility to budgeting without certain information getting in front of the wrong eyes.  With this security established, budget contributors can actually own the part of the budget that they have to manage throughout the year.  Seems logical, right?

Not every software delivers though.  Let’s use ease of use, collaboration, and security to compare how the following budgeting tools perform for manufacturing and distribution organizations using Dynamics NAV:  homegrown Excel budgets, Microsoft Forecaster, IBM’s Cognos TM1, Oracle’s Hyperion, and Solver’s BI360.

As it is globally trusted, let’s start with Microsoft Excel. Approximately 90% of today’s organizations still depend on Excel for manual budgeting processes.  This spreadsheet program is easy to use because it has been nearly ubiquitous for two decades.  However, Excel isn’t equipped with a database that allows for easy teamwork – or the security required for protected collaboration.  Because Excel has static input templates, several issues can arise when you manually link spreadsheets for an aggregated budget.  On the other hand, Microsoft Forecaster is a tool focused specifically on budgeting.

Since Microsoft released it, 2000+ organizations, including manufacturing and distribution businesses, have deployed Forecaster for their planning tasks, probably due to Microsoft’s brand strength and loyalty.  However, the program is in maintenance mode regarding any development, as it is now at its product life cycle end.  Forecaster functions on a proprietary platform, even though it is a Microsoft offering and could have been built with Excel formulas.  Users have to learn a whole new set of features, formatting and coding, which typically translates to a lengthier learning curve, with more training costs.  Additionally, Forecaster is likely too simple for modern budgeting demands, especially when you look at ISV solutions.  Finally, it is a known fact that plenty of Forecaster users compile much of their budgets in manual spreadsheets outside of the product in order to accomplish the layout and calculations they require for tasks like revenue budgets or complex payroll.

Two established budgeting tools: IBM’s Cognos TM1 and Oracle’s Hyperion.  Both tools were instant successes when they emerged in the early 1990’s.  There is a large following for IBM and Oracle products in the upper-market customer base – and Cognos and Hyperion are relatedly popular.  Their age delivers power, but also technical complexity, so they usually require a number of internal resources for management of the product.  Some Excel has been built into the tools, as well as web front-end functionality for larger manufacturing and distribution organizations or those that don’t prefer Excel-powered technology.  For the rest of us, these tools mean acclimating to proprietary formatting and coding, in addition to OLAP cubes (i.e. TM1 and Hyperion Essbase) – for data management, budgeting, consolidations, and rules.  Their complicated nature is associated with decades-long development.  That said, they are both part of well-rounded suites of Business Intelligence (BI) software, even if they’re typically costly and not as “fully integrated” as marketed due to acquisitions from a number of vendors over time.

A comprehensive BI suite means you can achieve ease of use by working with only one team of sales, consulting, and support professionals who can assist you with all of your BI analytical tools for Microsoft Dynamics NAV.  Solver’s BI360 delivers a completely integrated, comprehensive BI suite.  BI360 is a modern Excel add-in, also providing flexibility with web budgeting and forecasting.  Users can maximize this hybridity by simply and securely collaborating on the design and utilization of parameter-driven, dynamic input templates, whether on the web or in Excel.  You can also have one of the many Dynamics NAV SaaS providers host BI360 in the cloud.  Because Excel drives both the add-in and the web-based interfaces, deployment and training are simpler for business end users.  BI360 isn’t even a decade old and is relatedly built with modern functionality, like multi-year budgeting and rolling forecasts, in addition to other features like a web portal, which answers consumer calls for business user friendly, collaborative, and secure budgeting.  Let’s conclude by discussing planning specifically for manufacturing and distribution.

In terms of budgeting and forecasting forms, you should find a tool that can expand your planning tasks for richer manufacturing and distribution analytics.  A payroll module can help to plan and organize with union/non-union wages and shift differentials.  A capex module allows you to strategize and manage your expenses you expect to incur for maintenance or purchases of equipment.  A project module zooms in on design and production for a new product or build.  An inventory manufacturing module provides demand production planning by focusing on cost, quantity, and pricing.  An expenses module allows you to order your projections for overall and departmental expenses.  Furthermore, there are options for both customer and supplier ranking reports.  You have plenty to consider when shopping for a solution that delivers effective, collaborative, and secure planning for all of your budgeting contributors.  Solver would be happy to answer questions and generally review BI360’s easy-to-use Planning solution for collaborative, streamlined decision-making capabilities for manufacturing and distribution organizations using Microsoft Dynamics NAV.

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