Australia’s economy is underpinned by the performance of its resources sector, with mining alone accounting for 14.3 percent of total economic output, according to the Reserve Bank of Australia.
But while the sector is dominated by several major players, it is also home to an ever-changing crop of up-and-comers.
These so-called junior minors are often born to prove the economic viability of speculative ventures. Should their initial returns prove promising, they find themselves needing to quickly adopt the systems and processes of a much larger business, and that includes the software systems that run them.
However, according to Jason Heaney, co-CEO of the Australian technology consultancy DyFlex Solutions, these fast growth businesses often lack the time, funding, and experience to manage a full ERP implementation.
Jason Heaney, DyFlex Solutions
“A lot of these companies are initially run on very basic accounting software, and that’s fine when you’ve only got a handful of people and a few dollars of expenses,” Heaney says. “But once you start on a feasibility study, you need a bit more rigour and control.”
DyFlex was founded in 2010 with a vision of bringing SAP to mid-market businesses in the resources sector, using a templated approach that could be both quickly applied and easily repeated. Heaney says Dyflex’s initial goal is to deliver a core set of capabilities that provide a solid foundation for the business’ growth.
“Then we bring on additional functionality as they go through their mining life cycle,” Heaney says. “For example, when they get into construction, we bring on the projects module, and when they get into operations, we bring in supply chain functionality and maintenance functionality.”
The early success in mining has been the springboard for Dyflex to now be a national business with over 180 people across all states.
Heaney adds “this experience has enabled us to spread to many industries well beyond mining. It’s remarkable how growing businesses can be very similar in their constraints and core needs. Take a wind or solar renewable energy business for example: basic accounting quickly leads to projects, procurement and maintenance.”
Heaney says the challenge is often made greater by the fact that many of the business leaders in these organisations have never implemented an ERP previously and need to be carefully guided through the process.
It’s a collaborative journey, rather than the customer just telling you what they need – they are looking for advice,” Heaney says. “And what’s interesting about the mid-market is that generally they’re almost as complex as the bigger guys but working at a smaller scale and often on a limited budget. It takes business expertise and not just software knowledge to guide them.
“It’s interesting how you take that complicated business model and fit it into a world where you don’t have the free capital to spend whatever you want, but we’ve sold SAP into companies that had only five users when they first bought it. Any myth that SAP is too complex or too expensive has been well and truly busted.”
Heaney says the factor that has enabled DyFlex’s approach to succeed is that despite the complexity of junior miners, there are generally many points of commonality in how they operate. Hence a solution that is applicable to one miner, such as accounts or the master data model, will usually be applicable to many more.
This template approach has also meant that DyFlex has been able to implement SAP in as little as three or four months.
“Most CEOs now see the benefit of the whole fit-to-standard idea,” Heaney says. “It’s been accepted that they’re not different, and if we’ve already done it elsewhere and it’s proven, they’ll take that as accepted.”
Heaney says this approach has been sufficiently compelling to dissuade miners from assembling their own solutions from smaller best-of-breed suppliers, especially once they understand that the ongoing integration costs of that approach are unattractive in comparison to the ease of management that comes with an integrated system such as SAP.
Heaney says the templated SAP approach also provides a more stable platform that enables miners to remain compliant with the regulatory and reporting regimes within which they operate, including for cross-border transactions.
Furthermore, Heaney says the presence of SAP within a mid-market business can give comfort to both investors and bankers that the business performance data they are provided with is accurate.
“It’s rock solid with controls and compliance and all these sort of things,” Heaney says.
The lean, agile, fit-to-standard approach has proved to be just as successful in other industries that Dyflex has worked with over the last ten years.
DyFlex has also expanded what it can offer to its customers by building out its skills across the SAP range, including with SuccessFactors and Ariba, using the same templated approach that has proved successful with core ERP. The success of DyFlex’s template approach, and across the resources sector specifically, has in turn strengthened its relationship with SAP.
“Whenever we’ve spotted gaps, we’ve always had access to the development team back in Germany,” Heaney says, “Even though we’re talking to the biggest ERP company in the world, there is a channel for us to get our customers’ ideas and our issues resolved. SAP has been very generous in how they’ve made people available to us.”
Heaney says he has never doubted his company’s decision to build templated solutions on the SAP platform.
“We have confidence that SAP actually does the job,” Heaney says. “It’s reliable, it’s robust, it’s fit for purpose, and the SAP tool set has never let us or the customer down.”