Questions and answers

Faced with competitive markets, volume and quality demands and new shipping regulations, recyclers of recovered fibre and other materials increasingly appreciate the value of operating with specialised business software.

These systems are designed to handle the workflow, business processes, documentation needs and other requirements that are common to recycling companies that collect, pack or broker commodities, helping owners achieve goals such as increased productivity, improved decision-making and greater oversight of their businesses.

Unfortunately, choosing the right solution is no easy task, especially with the numerous offerings in the marketplace and the multitude of features to sort through. To help recyclers choose the right software for their business, here are seven important questions to consider before making a final decision.

Does the software meet your “core” business needs?

You would think this would be common sense, but it’s surprising how often decision-makers get distracted by demo showmanship or bells and whistles. Choosing the right solution begins with identifying your critical business processes and requirements, separating them from features or functions of lesser importance. Whether it is inventory control, workflow, documentation or accounting, it’s important to start with a prioritised list of what you expect the software to do.

Is the system easy to use, and what do current customers say?

Choosing a solution that’s logical and intuitive to work with will deliver the productivity gains and customer service improvements fundamental to achieving your business objectives. If your staff is left with the impression that the new system is too difficult to work with, frustration and lack of support easily can spill over into unexpected training and implementation problems.

Every software vendor provides references, and speaking with these companies can be helpful. You also should consider the scale and reputation of a vendor’s references. Larger companies may tend to apply greater resources to their software evaluation process and, it’s worth noting, have much more at stake if they choose the wrong solutions. Conversely, references that are known to have a poor reputation in the industry can call into question the credibility of an endorsement. Always ask the software provider who its largest customers are and how long they’ve been using the company’s product. Chances are the credibility of the references and the similarity of their businesses to your own will say a great deal about whether the software is right for you.

Will it adapt to changing business needs?

It’s important to consider not only the features you need today but also those you might need in the future. Many of the systems specifically marketed to the recycling industry have a tendency to be functionally strong in some areas, such as scrap buy-back or packing plant operations, but may be weak in others, such as material processing, inventory control or brokerage.

Purchasing business software is a long-term investment. It’s important to consider whether it will be able to support the changing needs of your business and help you pursue new opportunities as they arise.

Scalability is not only about handling increasing numbers of users or transaction volumes, it’s also about whether the product will offer the kind of features you might need as your business grows and if the vendor’s support team has the knowledge and experience to meet increasing demands.

Additionally, it is important to find out what’s involved with performing a software upgrade, who is responsible for doing it and whether it’s something you can easily do yourself.

Does the accounting model (really) work?

One of the advantages of working with recycling business software is having access to specialised reports, such as gross profit, commissions or inventory, that would otherwise be difficult to get from your accounting system. But relying on these reports also can be a problem if they don’t reflect the sales or purchases reported in your accounting system.

The trouble is that many software solutions rely on batch files to manually upload transactions to your accounting package. This makes it easier to integrate with a variety of products but potentially can lead to variances. Batch files can be mishandled and subject to posting errors that can result in missing transactions. When variances do occur, accounting for the differences can be a long and tedious process. It comes down to an important point: the integrity of the accounting model and the ability to reconcile against it.

For recycling systems that calculate profit or track inventory costs, it’s important to look at not only the process of transferring sales and expenses to accounting but also at how easily the accounts being posted to it can be reconciled and whether any tools are available to make this job easier.

How will it provide ROI?

For many recyclers the true cost of introducing business software is not only the license fees or the training costs but also the commitment of time, dedication of resources and the potential disruption throughout the implementation process. Thus, it is crucial to consider what kind of return on investment (ROI) you can expect from your new business system.

The following is a list of some typical ROI factors you should look for in any software solution:

• eliminating redundancy – Look for features that can help avoid the use of spreadsheets, manual document preparation or other functions that can involve duplicate data entry or maintenance.
• avoiding errors – Does the software offer features that can catch user errors like incorrect pricing or weights or overpayments to vendors?
• workflow features –Are there workflow features or tools that will allow your operation to collaborate better and improve the tracking of critical business activities, such as shipping status, booking cutoffs or received mill weights? Also, look for opportunities to tie into data feeds or electronic data interchange services to further eliminate manual entry.
• visibility – Consider how increasing the visibility (and central access) of business information might affect productivity and oversight.
• reducing dependencies – Will the software help introduce standard procedures that will make it easier to train new personnel and minimise dependencies on outside accountants or consultants?
• value-added features – Does the solution have features that can provide added value to relationships, such as mobile app or a “self-service” Web portal that might also reduce email requests and calls from clients? Are there any mobile device or Web-based apps that can help improve productivity of your team, especially when working remotely?

With business software, it’s important to recognise that measuring ROI is not only about reducing head count (though it can be) but also about the different ways in which it contributes to the growth of your business while helping to minimise your costs.

Who’s behind the training and support?

No matter how well-adapted a software system is in meeting your business needs, a poorly planned and executed implementation led by inexperienced staff easily can undermine the entire project.

One of the first things you will want to know is who will be assigned to the project team that’s involved with the training and implementation and what their credentials are. How many installations of the software have they previously done? Does anyone on the team have firsthand experience in the recycling industry outside of working for the software company?

The software vendor’s implementation team is likely to invest a lot of time working with you and your staff to learn about your business and implement the software. Ideally, you’ll want to know whether these same people will have an ongoing role in supporting your account or whether you will end up working with help desk staff that may know little about your project.

How long will it take to go live?

Successful business software projects will often demand a considerable amount of time and effort, usually over the course of several weeks or even months. You’ll have much at stake implementing a business system for your recycling company. Before going forward, it’s vital to understand the time commitments and the expectations to ensure a successful transition.

Choosing a software system to help manage your recycling business doesn’t have to be difficult, but it’s important to recognise that not every product excels at doing everything. When you’re looking at solutions, stay focused on what your business really needs today and think about what it might need in the future.

Make sure the partner you choose comes with experience and success stories that are relevant to companies like yours. Most importantly, make sure you understand the value and ROI that a potential business system can deliver. Avoid making judgments solely on cost because, more often than not, that’s a sure way to end up making the wrong choice.

The author, president of cieTrade Systems, based in the U.S. state of Connecticut, can be reached at haber@cietrade.com. This is a modified version of an article that originally appeared previously in an issue of Recycling Today magazine.