Ask a MHEDA-NET Group: Paperless or Cloud-Based Systems

January 31, 2018

“Has your company considered converting to a paperless or cloud-based system? If so, what successes and challenges have you faced in implementing it?”

Pete Roell, President Concept Storage Solutions Ltd, Vaughan, Ontario Canada

Concept has not converted to a paperless system and we continue to store all of our information on our own server. We like the comfort of having control of our data and currently are uncomfortable or unsure about having this information stored by a third party. We may change our opinion as the amount of information continues to grow.

David Cochran, COO Allied Toyotalift Knoxville, TN

In early 2017, Allied Toyota Lift completed implementation of a mobile paperless service system. This has been a real success for our aftermarket operations which has resulted in enhanced customer service, improved productivity, and reduced costs.

The system that we implemented runs on a tablet with a cell connection to our business system in the home office. The basic functionality provided is as follows.

• Work orders are opened in the office and assigned to specific technicians.
• The work order along with instructions from the office appears on the technician’s tablet.
• The technician locates the unit and reviews information on their tablet such as ownership, service history, previous hour readings, warranty expiration, maintenance contract details, etc. and goes to work.
• If the work order is a PM, then a model-specific inspection checklist is completed and any repair needs are documented.
• If it is not a PM, then the technician chooses preloaded statements that describe the reason for service, the diagnosis, and the work performed.
• The technician accesses the parts inventory for their van on the tablet and enters the quantity for any parts used. Any request for additional parts is entered in the tablet and immediately shows up on a screen in the parts department. The part is set aside for technician pickup after being pulled from inventory or ordered if not stocked.
• A print preview of the work order document is reviewed with the customer. Feedback regarding any repair recommendations is documented and the customer signs on the tablet.
• Time is automatically tracked by the system and added to the work order, including a breakdown of travel versus onsite time.
• The work order is closed by the technician, immediately shows up in the office, and review/ billing begins.
• The final work order is automatically emailed to the customer and any quote requests are automatically communicated to the service writer.

After several months of management planning and set up, we implemented the system gradually over about six months. In each branch, we trained groups of about four technicians in two hour sessions per week for three weeks. They were given homework assignments to complete between sessions, were encouraged to practice in real life on the work they were performing, and then went “live” when they were comfortable. As one might expect, there was a wide distribution of computer skills among our technicians… but each of them mastered use of the system.

Our entire mobile technician crew is now using the system. The benefits? We have reduced the average time from work completion to billing by over four days. Our labor efficiency has increased by almost 10%. We have reduced parts inventory on our vans. We are wasting less time on the telephone. We have improved warranty recovery. We make more repairs in a single visit. The office is spending almost no time entering labor and parts.

And best of all, there is no paperwork to get lost.

The initiative to go paperless and leverage systems to achieve higher levels of coordination and efficiency within our dealership and the entire dealer network is advocated and supported by our main OEM Partner, which has been helpful to gain broader adoption. Has there been a lot of hard work, investment in hardware and connectivity, resistance to “change,” and errors to address due to learning curves? You better believe it… but, for us, it has been worth it!

David Cranston JR, President, Cranston Material Handling Equipment Corp, McKees Rocks, PA

We have been building and implementing a new CRM software package, which allows for paperless workflow. One of the goals of the system is to eliminate the need to print any piece of information from the time a lead enters the system until the invoice is generated. This means that when a lead is received verbally it is first entered directly into the CRM. If the lead was received via email, the email is also attached in the CRM to the lead. As other pieces of information are received, such as RFQs or drawings, they can be attached to the lead as well. From there, lead proposals are created and all vendor quotes, drawings, brochures, and other supporting documents are attached to the proposal. The same process is repeated when a proposal transitions to a sale, and sale into vendor POs. Because there can be drawings required with some orders, the sales and PO modules have an additional feature that allows for the attaching and tracking of drawings and drawing revisions through their approval process. Invoices are then generated and can be emailed directly to the customer. While our implementation of all the system’s features is not quite complete, most of the paperless options have been operational for 6 months and we have had benefits and challenges.

The benefits of the system have been has been as follows:

1. There is a repository of information users can access to view at any point in a projects life cycle all information associated with the project pre or post sale.
2. You can very quickly go back and look at all supporting documentation on proposals or sales that are long in the past.
3. You never have to print a document from the time a lead is received until a sale’s invoice is emailed.
4. Our installation crew can log in from the job site and pull up drawings, instructions, and other pertinent information in the field on an iPad or laptop.

The challenges we have faced are as follows:

1. Training everyone, myself included, to attach all documentation as it is received during a lead/sale’s life cycle. We have made it drag and drop, but you still have to take a moment to get the right screens positioned on your screen to make it work. While it only takes a moment it is still easier to not attach documents in the haste of following up on a lead, creating a proposal, or approving a drawing.
2. Naming the documents, when they are attached, in a recognizable way so that when you view the document list you know what the document is without clicking on it.
3. Computer screens are limited in size compared to your desk. When you have a project where you are getting many quotes from various vendors, it is often easier to print and work from physical copies that you can spread out on your desk, rather than to be jumping back and forth from different documents hidden underneath others on your screen. When working at a desk adding a second large screen can help alleviate this problem, but it can be a nuisance when you are on the road with your laptop.
4. You still often need to print proposals for a presentation for a customer or an invoice for customer, who does not have a process for receiving emailed invoices. So being truly paperless is not ever totally achievable.
5. Some employees simply like working from printed copies. As a non-stocking distributor, it would seem like the process to go paperless would be fairly straight forward to accomplish. However, to have a system that allows you to simply receive, capture, organize, view, and send the myriad of information that makes up all the information that flows through your business is a daunting task and mind-set adjustment. Some sales people won’t utilize it as much as others, because they believe it slows them down. But there is no doubt in my mind that over time, as they begin to get in the habit of attaching pertinent documentation, they will see how it simplifies finding the information at some future date, and how it benefits those who support the project cycle downstream. We will continue to improve our productivity and print far fewer pages than we do today.

Tom Duck, Director of Operations Lift Systems Division Gregory Poole Equipment Company Raleigh, NC

To answer the first question, yes, we are in the middle of a conversion now. The second creates a little more discussion as to what successes and challenges a company faces. There have been quite a few articles on this subject and it seems the topic is covered in almost every PowerPoint presentation these days. There are many reasons for this, including growing revenues, creating business efficiencies, aligning the various departments into a cohesive unit and others, I’m sure all of us can mention. The truth is every company has its own unique set of circumstances and will require its own way to justify a project like this. In general, one should look at the investment from a quantitative and qualitative perspective.

If you look from the quantitative approach first, the thing most companies examine is how much inventory reduction or control will be improved, and how much better tech efficiencies can be tracked and managed with an effective ERP system. Analysts generally agree that between a 20 to 30% reduction in inventory is achievable and between 10 to 15% increase in tech productivity is achievable. Forecasting and scheduling improvements resulting from an effective ERP system will have a positive impact on parts pricing and stocking as well as improved management of service GP and profitability. An area often overlooked is the direct labor and indirect labor costs in the service area. Direct labor savings flow from improved scheduling that balances workload and minimizes overtime. Indirect labor savings resulting from modern ERP systems adds up quickly. Most analysts believe that a ten percent reduction in labor costs is easily achievable with the reports available with an advanced ERP system.

As far as the effect of going paperless, your company can have immediate savings to the bottom line. The average office worker uses 10,000 sheets of copy paper each year, according to reduce.org. Multiply that by the number of employees you have, and you can see how going paperless is a no brainer when it comes to cost cuts.

The last quantitative area to discuss is accounts receivable. With the ability to produce error free and timely invoices, the turns on receivables can be improved five percent or more, resulting in a significant improvement in cash flow. Again, each company is unique and the best advice when developing the economics is to be consistent, realistic and develop a real world narrative around each savings category.

From the qualitative approach to making the ERP case, the best reasons I can give are the ability to provide better information and analytics in all areas for tracking cost and productivity. Customization is also a great feature with a cloud ERP system without losing the benefits of future upgrades. And the ability to store records and documents that are essential to your business are now easy to retain and access.

The scope of the transition to a cloud-based paperless system can be daunting. A company-wide training is part of the requirement but the best and most effective way to implement is with “Super-Users.” Within each department, the project managers should identify the tech-fluent employees who will be able to adopt the new system with ease, and help create a training cascade that will reach even the most resistant uses.

The bottom line to purchasing a new software suite, vendors must show owners and upper management how the new investment will make money and provide a solid return on investment.

Roger Troost, Chairman Morrison Industries Grand Rapids, MI

Morrison started our move more than six years ago towards the cloud and as much paperless systems as practical. The change has been driven by the need to improve our efficiency, technology changes, and customers’ expectations.

Cloud based systems

• Data center
• Office 365
• Telephone

The most significant issue when we shifted to the cloud is the fact we no longer have the same control over system security. Pre-cloud we had total control over the security of our network versus today as we are depending on the vendor. We had an IT consulting system do a study of our system security and I was surprised that the company that is hosting our data center was the greatest risk. The second significant issue for us has been the fact that we no longer have and are dependent on someone else if a problem needs to be resolved.

Advantages of the cloud:

• It drives down cost on hardware and upgrades.
• Eliminates the need to monitor your infrastructure 24/7.
• Eliminates the need to continually update software.
• Provides redundancy needed for continuing operation.
• Provides the flexibility needed in today’s rapidly changing IT environment. Paperless systems
• Banking
• Invoicing
• Payables
• Personnel management
• Time clock
• Paychecks
• W-2
• Health insurance open enrollment
• 401-K enrollments and changes
• Parts and service manuals

Security is again one of the most significant disadvantages of running paperless systems. You need to stay current on who has access to your information or you may be giving competitors ways to access your data. Employees need to be properly trained so they understand how your various systems are organized or you will not be able to retrieve.

Your employees become more dependent on technology. Advantages of paperless systems are significant:

• Ability to look at documents at a variety of places and devices.
• Elimination of hundreds of files, storage boxes and file cabinets.
• Enables customers to have access to their documents at any time.
• Environmentally friendly message for your company.
• Auditors find this easier to use versus having to look through file cabinets.
• Disaster proof from fire, hurricane, or flood.

Scott Fawcett, President Bode Equipment Company Londonderry, NH

The topic of cloud based or in-house paperless software has been discussed in great detail over the last couple of years. However, more recently, we have been searching for a new ERP system. Our hope was that we would roll out a new ERP system with incorporated document scanning technology. We wanted all supplier and customer data to be connected however, during our review process, we started to learn that our expectations were creating a costly package and/or an extended implementation period.

As a result, since we failed to find an ERP solution that we felt was best for us, we took a break. We will re-start our review of software needs and document storage requirements in the coming months. We understand that working out of file cabinets is not efficient nor conducive to our working environment. Our clients want information quickly and expect that past/current data is at our fingertips.

Jeff Darling, VP Operations Washington Liftruck, Inc. Seattle, WA

Washington Liftruck implemented a new ERP system in October of 2016 that is cloud based. There were some initial hiccups in the communications with the cloud server but once those startup issues were resolved, being in the cloud relieves us of the responsibility of maintaining servers onsite, backups and all the logistics associated with computer hardware in a computer room.

Part of our plan is to implement a field service module that will be paperless with all the technicians to have an iPad to access current parts inventories, customer history, machine specifications and gather a signature on the electronic document. This will also allow the technician to email and/or print the customer a copy of the work order while in the field. Our plan is to implement this in the first and second quarter of 2018 and as one might guess, training will be the key to success!