Five critical business elements that make the difference between success and insolvency


Recent experience has shown that a company's performance may be improved not only through increased sales, but also through real-time coordination and control of operational costs and cash flow. Performance oriented managers pay attention to five basic elements of the companies they lead.
The most important element, in the current economic climate, is of course the cash flow which, if it records a fluctuation bigger than 10% from the planned course of a month, while the activity remains constant, should trigger a warning. ERP solutions enable the forecast of the evolution of daily cash flow, which helps managers make early preventive decisions.
"Periodic fluctuations and predictable cash flow can be experienced, depending on the seasonality of the business and many other factors, but any significant fluctuation must be immediately solved," says Adrian Bodomoiu, Wizrom Software General Director, the company with the largest number of ERP customers in Romania.
The second important element is the income from products sale / services that can be managed and controlled by software tools such as solutions for customer relationship management (CRM) and sales force automation (SFA).
The correlation of stocks with sales is the third element that can be tracked in real time to prevent non – profitable stocks’ purchases or not delivering due to lack of products. Real time planning can be performed with the help of a Demand Planning solution, which enables minimizing logistics costs, increases the management accuracy and storage space usage and provides a better handling of the orders.
The delivery costs must be kept under control, as well, as the smart management of this activity can generate relevant operational cost cuts. An effective tool for this purpose is a transportation management solution through which managers can obtain a better mileage by optimizing the routes, decrease shipping costs and waiting times, respectively increase fleet usage level, improve the quality of delivery, namely reduce CO2 emissions.
Based on these elements, a performing manager should be able to make forecasts of future revenues and costs, in order to know where to head the organization and what to report to the shareholders. The budgeting, with forecasts according to scenarios based on numerous criteria, can be done very effectively using software tools specially created for this purpose.
"The general context requires faster reactions and in ever shorter periods of time, forcing managers to continuously adapt their actions to achieve the objectives. The managers using appropriate software tools are always one step ahead ", said Adrian Bodomoiu.