Seasoned expert Gary Sanders has partnered together with MuniBilling to help give readers an in-depth look into the world of Utility Billing Systems.
For today's Ask The Expert blog we'll be focusing on how your organization can leverage both an ERP and a Best-Of-Breed system to work together.
Q: When it comes to choosing a Utility Billing System, do we have to choose one or the other – ERP or Best-Of-Breed?
A: The simple answer is “no” – you can mix and match software applications from an ERP vendor and a Best-Of-Breed vendor. For example, you might want the integration of financial applications from an ERP vendor, but prefer the utility billing features from a completely different Best-Of-Breed vendor.
Q: Are there disadvantages to mixing ERP and Best-Of-Breed applications?
A: In the above example of utility billing from one vendor and financial applications from another, I wouldn’t call it a disadvantage if you are getting features you need from the Utility Billing System that the ERP vendor’s system doesn’t provide. What you do have to deal with, however, is managing two implementation projects from different vendors.
Depending on how large your organization is and how many staff members would be involved in learning each vendor’s software, this might not be an issue at all. But if you are a smaller organization where your staff wears many hats, this will require some coordination so you don’t overwhelm your staff.
Q: So then what integration would be required to mix systems?
A: Utility Billing Systems generally interface with financial systems at two points.
The first, and most obvious, is journal entries to record any transactions that impact revenue or accounts receivable, generally billings, payments, and adjustments. The second is creating vendors and invoices to send refund checks to final billed customers who end up with a credit balance.
Q: Taking that into consideration, then how would we accomplish this integration?
A: Depending on the capabilities of the two systems you are trying to integrate, this would be accomplished by file transfer or API. File transfer is the simpler of the two, with the utility billing vendor providing files, generally CSV or fixed-length text files, in a format the financial system vendor is able to import.
If the financial system vendor has an API (application programming interface) specification and the utility billing vendor can communicate with this API, the integration can be accomplished more seamlessly than it would using file transfer.
Q: If we do install hybrid systems, which system should we implement first?
A: There is no one-size-fits-all answer to this question – it depends on a number of factors.
If you are struggling with one system or the other with your existing software, then that application makes the most sense to be the first to be implemented. Another variable is what is the lead time for implementations for each vendor?
If the financial system vendor has a nine-month lead time and the utility billing vendor can have you live in four months, then lead off with utility billing.
Q: Is there an advantage to implementing one application over the other first?
A: In my experience, it can be beneficial to have the financial system live before the Utility Billing System goes live, but it’s not critical.
One advantage of having the financial system live before the Utility Billing System is any issues with establishing a chart of accounts are already resolved before the Utility Billing System is implemented.
I have seen systems where the Utility Billing System went live first, then when the financial system was being implemented, a decision was made to revamp the chart of accounts. That required going back to the Utility Billing System and modifying all of the general ledger interface files.
Gary's 40+ years of experience in the industry has granted him valuable knowledge for any billing entity. With the wealth of his knowledge you can request an Operational Analysis for your organization from him!
You may be wondering, what exactly is an Operational Analysis? Well, it essentially is when Gary looks through ALL of your systems, and interviews your team, to figure out how best you can improve your billing operations.
Here are a few of your organization's systems that Gary will assess:
- Billing System
- Accounting System
- Metering System
- Service Delivery System
The end goal with this analysis is to figure out how to best save your organization time and money. This could also mean suggesting another company's platform if it's the better fit for YOU.
Gary has hosted his own blog for the past ten years. Some of his more notable credentials is that he has designed, built, implemented, and supported both ERPs and Utility Billing Systems. Thankfully, he's only a hop, skip, and jump away.