Constraint Theory and Technology
A critical aspect of running a successful business is the identification of constraints and the development of strategies and tactics to handle these constraints.
Standing on a garden hose creates a flow constraint, and limits the amount of water that reaches your garden. Similarly every business has numerous constraints that limit sales and profits. For example, if we take the happy but unrealistic case where the sales department starts delivering five times the usual volume of sales, does that mean that sales and profits will be five times larger? We know that this is not the case.
We understand that receiving an order still requires us to process the order, procure the raw materials for the order, manufacture the order, deliver it and collect for it. Each step is made up of multiple steps and processes that “constrain” the flow of sales and profits.
Consider the following common constraint example where the customer accepts a quotation produced in a sales front-end system. It is then often rekeyed into the production system and also into an accounting system. The work is done and recorded in another system and billing information is then fed back into the accounting system. Invoices are sent out and a collection system of some sort is used to collect the money. The multiple steps, multiple documents, multiple data entry points all introduce delays and errors. This is one of the scores of constraints in your corporate system.
Technology can help.
Imagine changing the above scenario where the approved order is electronically sent to the “accounting” system. The accounting system generates the suggested purchase order with the relevant data already captured. The “production” system receives the order information electronically. The final billing data is then added in to complete the transaction and the accounting system sends out the invoice electronically.
If elapsed days of clerical activity (i.e. the constraint), could be reduced to hours, what would that mean for your business?
Evron can help you identify and deal with constraints. Call us for a free consultation.
Larry Noble, P.Eng, MBA
President, Evron Computer Systems Corp.
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Tax Harmonization, The Good, The Bad, and The Ugly
On July 1, 2010 the system of dual Goods and Service Tax of 5% and Ontario Retail Sale Tax of 8% will cease. In its place we will have the combined 13% Harmonized Sales Tax. As with any tax change, some taxpayers will benefit while others will have to shoulder more of the burden.
The Good
If you are in a business, and you currently file GST returns, you are now going to be able to recover the eight percent retail sales tax that you are presently paying on items that you are not buying for resale, such as overhead items. For example, if you purchase office supplies today, you will pay one hundred dollars for the item plus five dollars GST (which you presently recover) and eight dollars of RST which you must expense as part of the cost of the product. The net cost to you presently for one hundred dollars of office supplies is one hundred and eight dollars. Under the new legislation, you will still pay one hundred dollars plus thirteen dollars in HST, but now all of the HST is recoverable. Therefore, after July 1, 2010, the net cost to your company of one hundred dollars of office supplies will be one hundred dollars.
Businesses will no longer be required to report RST to the provincial tax offices. The HST report will replace the GST report. Businesses will be obliged to submit one sales tax report instead of the present two.
In addition many of the very confusing RST rules will cease to exist. The GST, where basically everyone pays it all the time will take precedent. All of the old RST exception rules and certificates will be redundant.
The Bad
The consumer has always had to carry the unrecoverable burden of the GST on almost everything (with few exceptions such as certain foods, residential rent). Now it is going to be thirteen percent. While it is true that in most cases it will be expense neutral, as the consumer is paying the RST on most items already, there will be items that currently do not attract tax that will go up overnight by eight percent.
Gasoline, fuel oil, tobacco, internet access fees, and almost all financial service fees will cost you eight percent more on July 1, 2010.
Many personal items will go up as well. Your snow removal services, your barber, lawyer and accountant, along with your taxi ride and the cost of renting ice time at the local arena, will all cost you eight percent more.
The Ugly
New taxes have been a fact of life since the “wartime temporary tax on income” of 1917. When the old federal manufacturing sales tax was replaced by the GST in 1990, the government of the time argued that the new tax burden would be offset by price reductions that would filter down to the consumer from businesses enjoying tax relief. Aside from some minor discounts on automobiles and major appliances, the price reductions that were factored into all the economists charts never reached the consumer.
Once again price reductions are being predicted by civil servants and are being factored into a new generation of economist's graphs and charts, as the offset that consumers will enjoy against the new tax burden. Let us hope that this time the reduced price predictions are right.
Irwin Pinsky, B.Comm., CGA, MCP
Irwin Pinsky is the manager of our small business division and focuses on our BusinessVision practice. Irwin’s experience includes that of a public practitioner focused on emerging companies, as well as financial controllership.
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From the Help Files for the Sage BusinessVision Website
Did You Know?
Scenario:
For each of your suppliers, Sage BusinessVision Accounting software allows you to store an address plus three contacts, each with different names and addresses. In certain cases, suppliers invoice from one location but payments need to be remitted to another. Is it necessary to change the supplier address each time to make payments, or is there an easier way?
Solution:
With the new version of the software, Sage BusinessVision 2009, there is a new feature called “Remit to Address.” When Remit to Address is used for suppliers, a new payment address can be specified so that payments can be sent to the correct location. Since this feature is optional, only suppliers that have different remittance addresses will use this.
The switch to use this new feature is located under the Remit to Address tab under Vendor Details. If this switch is enabled, the user will enter in payment address details identical to the main Address tab. This new tab also features three contacts. Payments made in Accounts Payable will automatically use the name and address under the Remit to Address tab. No more changing the main address name and address!
James Mitchell
Senior Consultant, Application Services.
Utilizing his 20 years of Sage Business Vision experience and expertise, James Mitchell maximizes the return in software investment for our clients.
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Studies have been done to show what priorities exist for small businesses. It's not surprising that the priorities are the same as those for large enterprises.
Small business in fact looks to be the fastest growing segment of technology consumption worldwide over the next decade. Two of the main requirements are better customer service and more productive employees. Companies want a communication system that would make it easier for customers to reach the right employee from anywhere;
This could mean that the call is forwarded to multiple numbers in a specified sequence, and, transferring the call from a land line to a mobile phone without any interruptions. With Unified Communications (UC) the call would automatically be routed to the device the employee you are trying to reach whether they are using a phone, a PC, or mobile phone. Customers immediately connect with the person they wish to reach instead of “Your Business Is Important to Us” recording.
Any location with an Internet Connection can be a working office. Your company can be more responsive to customer requests by streamlining access to people and information. Customers get what they need when they need it. Cisco’s UC, in partnership with Evron, makes it possible:
To route calls to staff wherever they are
To retrieve calls on your laptop
To provide remote access to needed data
To get real time customer history when a call comes in
The key requirement is that all this is delivered with a secure trusted system.
To understand UC, consider all the tools your business uses now, phone systems, mobile phones, faxes, internet, voicemail and others. Think about all the productivity applications you use i.e., calendaring, conferencing, emails, and messaging. Now instead of separate, distinct tools, they could be working together as one solution. Instead of running on independent telephone cabling and relying on proprietary equipment to deliver these capabilities, UC leverages the company’s data infrastructure so services on the data network are made available via the phone system and vice versa. The reason is because voice and data use the same network.
As another benefit, thanks to wireless virtual private network VPN features, soft phones, business applications and communication tools such as instant messaging and video conferencing employees can easily stay in touch no matter where people are or what device they use. Operational efficiency transpires when employees have the ability to share data and communications effectively.
Effective interaction between employees, partners, suppliers and customers is a sure fire way to boost efficiency while also reducing cost. Integrated voice, video, data and wireless provides the kind of interactive calendaring, video conferencing, IP communications and other technologies that your business needs to foster seamless easy collaboration.
You no longer need a separate voice and data system. You now have a single structure with lower maintenance costs. These solutions are smart, simple, secure, reliable, scalable and affordable. Unified Communications is a platform for increasing productivity, reducing cost, and elevating employee and customer experiences. These are vital components for your business operation.
Integration and Application development services are a key competency of Evron. As an example, we have integrated UC with Business Vision which is a complete all inclusive business and accounting software application. With the integration of UC and Business Vision we can provide additional productivity gains and opportunities to better manage your business.
Imagine what you can do with information like this.
Think of how you can improve your business and we at Evron can help you make it happen.
"Evron’s Unified Communications solution has given us exactly what we were looking for, plus new opportunities that we weren't aware of before".
- Gary Brown, President, Donleigh Sports Limited, TO.
Paulette Kestelman
Senior Consultant, Application Services.
Paulette Kestelman has 30 years management experience, Outsourcing, Human Resource Service delivery and Customer Service.
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