While the pandemic set the digital transformation of business in motion, the rapid transition toward digitization and automation isn’t ending anytime soon. In fact, Statista found that 74% of companies considered digital transformation a top priority in 2022, up from 54% in 2020. Plus, artificial intelligence is also accelerating the need for adopting digital-first tools.
It’s no longer feasible for a company to continue working from disconnected spreadsheets. Switching to intelligent platforms is rapidly becoming necessary to save valuable time, improve organizational workflows, and keep pace with your competition.
While the changes are critical, it doesn’t make the switching process any less daunting. First, you have to find the right tech fit and then plan the change for the most optimal time.
Typically, that means opting for a technology swap at the start of a new year as the tax cycle resets, but no single date is perfect for every business. A lot of issues can pop up during system swaps, so we turned to Brad White of VARC, who shared his strategies on how to overcome change management challenges.
Before we dive deeper into how to manage change initiatives in your business, let’s consider what you’ll get from transforming your systems. It all comes back to the three core concepts of the change management process — people, processes, and technology.
It’s a heavy ask to expect employees to balance their normal job scope with extra daily data entry tasks for items like inventory audits, vendor management, and product return processing. The extra detailed work and constant interruptions of their normal duties lead to a frustrated team. Rather than being happy about a growing business, your employees are likely more worried about burnout and stress due to unnecessarily time-consuming tasks.
But if you fix the system and address their concerns, you’re going to win them over. According to Brad, you’ll have “happy people who know that the company is prioritizing their needs.”
Reducing operational inefficiencies has remained the second most sought-after goal of digital transformation strategies since 2020, just behind improved customer experience.
By implementing organizational change based on digitization, you can take out many manual roadblocks. For example, instead of a person overseeing inventory management and preparing manual orders, you can configure an automated process that handles all those tasks.
Cin7’s software lets you send automatic reports to relevant stakeholders and cut down the time your team spends compiling those reports.
By switching to tools that better fit your business needs, you can improve workflows and eliminate bottlenecks. For instance, if an employee was previously re-entering new information from a third-party source to your internal tech stack, a new system that integrates with your other software allows automated data transfers.
Utilizing these integrations reduces human error, creates more flexible and scalable workflows, and gives your employees more time to focus on other tasks that maximize your business’s revenue.
While switching systems to new technology appears to be a straightforward choice, the complicated change implementation and migration process can make decision-making difficult. Managing the changes with a strong change management plan is vital for a good outcome.
Effective change management ensures:
Brad explains that while making a switch would take time and energy, he’s going to have a happier team at the end. He’ll have people who know they’re not wasting their time.
To ensure a successful switch, you need to take your time and research, earn buy-in from all stakeholders, and opt for technology with the least employee resistance for project success. Part of that is having a plan and sticking to it.
Timing is one of the most important factors in deciding the success of a change effort. Just like an e-commerce website schedules its maintenance in slow periods, part of successful change management is picking a period with the least impact on internal operations and employees.
Status quo changes make taxes complicated for employees and the company without careful planning. For example, you’ll have to import all the previous payroll information into the new solution, and Brad shares that “you need the prior paycheck information to know whether you have hit the limits for things like Social Security.” Missing that information could mean failing to stay compliant with tax regulations. Plus, swapping your payroll system in the middle of the income tax year in the U.S. could cause employees to get two W-2s.
To ensure the new system rollout happens without major disruptions, Brad recommends picking one of the following two times to make the switch and planning for at least two months in advance of the switch date.
End of the financial year
The end of the financial year is the perfect clean slate you can use to start fresh as the new period begins. As accounting and financial cycles close and tax periods roll over, you can switch to a newer system without worrying about data split across multiple systems.
In other words, if you start with a new tech stack at the start of a new financial year, there’s a limited need for manual data migration, which makes the change much less complicated.
End of a quarter
While the end of a financial year is a great opportunity for switching business systems, you can’t always wait that long. Sometimes, you might lose too much money in the inefficiencies during the wait. In that case, Brad suggests the end of the quarter is a good alternative “since you file sales tax return monthly or quarterly in most cases.”
Once you’ve chosen a switch date, you need to plan backward to give time for research. A recommended change management strategy is to allow at least two months of research and preparation before the switch date.
Brad says that if you plan on a Jan. 1 change, “You should be entertaining solutions in the October-November timeframe. That way, you have enough time to vet the solutions and decide on one to implement before the year ends.”
For e-commerce businesses, this planning and researching period can be difficult with the Thanksgiving and Christmas holiday sales season. Online sales are expected to reach $221.8 billion in 2023, and every retailer works hard to capture a piece of those sales. However, Brad recommends that businesses find a way to prioritize planning in spite of the busy season, as the result will position them better in the long run.
As a change leader handling project management, you need a lot of data to make decisions. Take the initiative and start by gathering feedback from your team members, including senior management. Get feedback on what is needed to meet company goals, what problems are causing delays in work completion, and what tasks are frustrating.
A system change isn’t just a copy-and-paste solution. It often involves creating custom solutions to ensure data can be migrated to new systems and that new tech stacks work with your unique processes.
You’ll need a partner with experience in complex migration processes and who specializes in software that meets your needs. A partner should be able to guide you through the process, whether it is fully automated or requires some manual data migration and software customization.
Once you’ve narrowed down the choices, ask clarifying questions from the short-listed partners to ensure they understand your problems and have the solutions for them.
For instance, if you want to migrate from QuickBooks Desktop to QuickBooks online, check out VARC Solutions.
It’s likely you have more than one system that needs replacement. For example, you may want to improve your inventory, sales, payroll, and accounting systems.
Switching all of these systems at once generally isn’t a good idea. Instead, take small steps and identify the necessary upgrades, whether that means one program at a time or two interconnected systems at once.
When you upgrade your connected inventory performance (CIP) to the next level via Cin7, you’ll need to switch to QuickBooks Online if you’re using Quickbooks Desktop because the desktop version lacks a modern API and is being discontinued by QuickBooks.
However, you won’t necessarily need to overhaul your payroll system during the process. You can look at tackling that change the following year.
In other words, if required, you can tackle more than one system simultaneously. Just be advised that attempting multiple changes increases project complexity. We recommend focusing on no more than two at a time.
Changing your business systems is rarely a smooth ride, but if you practice good change management strategies like doing research and preparing your employees ahead of time to avoid culture shock, you can minimize disruptions.
The end result of a well-planned system switch makes your future organizational changes easier. For instance, opting for Cin7’s inventory management system opens your organization to easier integrations with systems like Shopify, Xero, Amazon, and QuickBooks.
So, if you’re looking for a modern inventory solution that simplifies and multiplies your business, start your free trial today.
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