Emma's and Tom's Pty: NetSuite ERP System Literature Review

This literature review examines the implementation of the NetSuite Enterprise Resource Planning (ERP) system at Emma's and Tom's Pty, a small to medium-sized enterprise (SME) specializing in fresh juice production. The review begins with an introduction to business process automation and its relevance, followed by an overview of Emma's and Tom's organizational structure, highlighting its characteristics as an SME. It explores the operational problems associated with the company's initial structure and discusses the selection of the NetSuite system, emphasizing factors such as business processes and growth goals. The review then delves into Emma's and Tom's sales procedure, identifying potential control problems within the automated system. Part 2 focuses on the NetSuite adoption and development, detailing how the system automates various business activities like production planning, marketing and sales, material and inventory management, and finance and accounting. The review also discusses NetSuite's market size, competitive advantages, and challenges faced by users of automated systems, such as control issues and power dependency. The paper concludes by highlighting the advantages of automation systems for businesses, particularly SMEs, while acknowledging their limitations.

Emma’s and Tom’s, Pty 1
Literature Review: Emma’s and Tom’s Pty
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PART 1
a. Introduction
Automation of organizational business processes either accounting, resource planning or others
have become part of the business culture. This is largely fostered by the flexibility, affordability
and the precision of these systems. However, it still proves to be a challenge to explain the
integration of this system with existing organizational structures. For this reason, it is important
to explore a practical implementation of such a system in a company that is already using them.
This paper explores the use of the NetSuite Enterprise Resource Planning system by the Emma’s
and Tom’s, a company that processes and packages fresh juice directly from the farmers without
additives or any kind of preservatives. The choice of Emma’s and Tom’s is based on my own
preference of them for their desire to produce healthier foods for Australians. In addition,
information on Emma’s and Tom’s was readily available online.
b. Emma’s and Tom’s Pty Organizational Structure
Emma’s and Tom’s falls under the Small and Medium Enterprises (SME) category of business.
The most defining character of SMEs is their organizational structure. According to a paper
published by Foundations of Management by Wioletta Mierzejewska titled “Directions of
Changes in Organizational Structures of SME - Results of Empirical Research”, SMEs
organizational structure is characterized by four dimensions. These dimensions are centralization,
formalization, standardization, and configuration. Unlike the structure of big corporations where
much effort is put on formalization and delegations of duties, SMEs show a structure where most,
if not all functions, are carried out by the top most level of management. Additionally,
documentations of most activities are not of paramount importance in an SME setting
(Mierzejewska 2014). In return, the dimensions are reflected in the organizational structure of the
SME companies. Figure (a) below shows a structural model of Emma’s and Tom’s.

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The above diagram shows the three levels of management that are consolidated within the four
characteristics of SMEs. At the very top is the top management team that comprises of the chief
executive, the marketing director, and the chief financial manager. The middle level comprises of
the production unit lead by the production managers which is directly managed by the top level
management. The last one is the bottom level management and consists of the “hands on”
department which include the customer relations and sales, accounting and human resource. This
would be the classical structure of Emma’s and Tom’s without the use of automation process. As
simple as it is, this structure may result in a number of the problem to the small company.
c. Operational Problems of the Structure
With the structure such as the one depicted by a figure (a) above, Emma’s and Tom’s is likely to
face many operational problems. These problems include its rigidity to change with a new
strategy. The same rigidity gives only allows the management focus on efficiency while failing to
include a margin for error and, consequently, innovation due to a focus on efficiency. In addition,
The Executive
Sales and Customer Relations Human Resource Accounting
Production Management

Emma’s and Tom’s, Pty 4
such a structure is also likely to prevent the necessary balance between autonomy and the need
for control (Sisney 2013). Such problems although seem to be insignificant, they are likely to
have a considerable effect on the performance of the company.
d. Most Effective System Acquisition
There are much software that can help Emma’s and Tom’s automate its business process. Hence,
this might prove a significant task settling down on the right system for an SME. The choice that
lies among custom, commercial or enterprise resource planning software depends on several
factors. Among them may be the company’s business process, inventory size, organization size,
the services offered, the employee base or even the growth goals of the organization (Epicor
2016). For instance, the best choice for Emma’s and Tom’s would be a custom system. A custom
system would be suitable because it will allow the company to tailor their needs to the specific
activities they want to automate. For instance, since the company is still in its infant stages and
only building a brand, it may feel that a face to face approach with its customers and potential
customers is more suitable than an automated one and therefore choose to leave the automation of
customer service from the system. A factor that would be impacted most by the system choice,
however, is likely to be the sale process.
e. Sales Procedure
Emma’s and Tom’s business model is unique to their business. That is, they do an in house
marketing. This starts with the sales team approaching different restaurants for a space in their
refrigerators for marketing purposes (Emmaandtom.com, 2017). If the people in that place like
their product, then the owner of the restaurant will actuate a sales process. The first step will be to
place an order with the sales team, this order is then processed by the accounting system in place
where the order number is generated and the items are delivered to the customer. The flow chart
in figure (b) below visualizes the sales process of the company.

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f. Control Problems
In the process above, the automation process may result in some control problems. For example,
it will be challenging for the company to change the order of the process. For instance, a scenario
where the company decides to send a few discounted test products to a new client who will order
through a call. Since the system will have to update the inventory, it will have to record the prices
of the products ordered. This makes it difficult to control an automated system. However, such a
problem can be eliminated by Emma’s and Tom’s customizing their system to include such
orders.
PART 2
a. NetSuite Adoption and Development
NetSuite, the software that Emma’s and Tom’s use, is an enterprise resource planning software
that facilitates the automation of accounting and the human resource management of mid-sized
Customers Orders
This is through a call by the customer to
the sales agent
The desired flavors are described
Inventory Made by
Sales Person
The sales agent enetres
information related to the
The system updates the inventory
It Conducts accounting procedures
Order is Processed
The Order recept is send to the
client
The order is delivered to the
client

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companies. The system is integrated and real time. For Emma’s and Tom’s NetSuite facilitates
the function of the following business activities:
I. Production Planning
This involves management and automation of the production process from stocking raw
materials to creating the inventory of the finished products. The automation system is
connected to machines that process and package the juice. The amount of raw material
used, processing time and overhead costs are automatically captured and recorded in the
accounting section.
II. Marketing and Sales
The system records the sales made and synchronizes them with the inventory to ensure a
timely and precise documentation. In addition, the system is linked to all major social
media to allow the company create any digital advertisements on the go. The system may
as well regularly recommend some of the marketing ideas for the company to implement.
III. Material Management
The system keeps a record of all the raw material used including the packaging material
and the fruit material. A separate inventory is kept within the system which is
synchronized with inventory to show the right ratios needed for production. The cost of
these materials, as well as the best-optimized ratios, are suggested by the system.
IV. Inventory Management
An inventory for every product, including raw materials and finished products is kept.
These Inventories are synchronized with every process allowing the management to
effectively reduce waste. The company as well tracks their waste which is used to feed
cows and therefore another inventory for the waste is created.
V. Finance and Accounting

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The system keeps all the books of accounting the company needs. These books are
constantly synchronized with the cloud data. The system as well manages the salaries of
employees as well as all the other costs the company may incur. The system generates
automatic budgets and may suggest possible adjustment that would optimize profits.
NetSuite’s Enterprise Resource Planning software is developed by NetSuite, Inc. an American
company that specializes in cloud computing. Essentially, the system adopts the functions of
almost all the mid-level and low-level management roles allowing a company to cut their
employee base significantly (Anon, 2017).
b. NetSuite Current Market Size
Being a foreign company, NetSuite has a low market share locally standing at only 4% in
Australia compared to 85% in the United States. However, it is the fastest growing business
automation software locally (Trends.builtwith.com, 2017). NetSuite market share rose by more
than 70 people I 2016 alone. At that rate, it stands a chance to beat the local MYOB (Mind Your
Own Business). Although MYOB currently commands more than half of the market share, there
are a number of factors that make NetSuite A preferable choice of MYOB (Trends.builtwith.com,
2017). One of these is the wide range of activities performed.
c. NetSuite Competitive Advantage
Although MYOB takes the biggest share of the market, its range of services is limited to
Accounting. NetSuite is more than an accounting automation system. It includes manufacturing
management and human resource management something that MYOB doesn’t have. NetSuite as
well prides itself in its simple to use set and interface. This makes the installation process
“painlessly easy”. On the other hand, most of MYOB, like QuickBooks, requires an extensive
training which may mean more expenses for a company. In addition, NetSuite may have the

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financial power to tap into a wider talent and technology sooner than MYOB hence likely to be
superior.
d. Challenges Facing Users
Automated systems have some disadvantages that prove a challenge to most of the users. In most
cases, challenges may be different from system to system due to the difference in which the
system is designed. For instance, MYOB users fault its system for its complexity while
QuickBooks feel their system does not have a comprehensive automation of processes. However,
there are some challenges that are faced by every user of any automation system. The most
obvious challenge that would face users using NetSuite or any other automated system is the
power to control the flow of the processes. Accounting software is designed to follow a certain
order of activities. However, sometime during a sale, a fault in delivery or order processing may
require that a step is skipped. This would require the control of the system. However, in most
cases, this control is not possible forcing a process to be allowed to finish till the end or call for
its entire cancellation. A possible recommendation to correct this would be t allow for both
manual automatic processes. This would ensure that whenever necessary, the system can be user
controlled. Another challenge is the need for power. In a case where there is no electricity, such
system becomes useless and inaccessible. This can prove to be a challenge, especially where a
company that has automated system needs to carry out business in areas that are not connected to
electricity. Similarly, in the face of a storm, where the power lines are cut off and may take days
before restoration, such system may prove to be of no use. However, automatic synchronization
and power backups using generators and solar systems can mitigate the such a risk by providing a
short term solution to power.
To conclude, it is important to note that Automation systems are playing an important role in
cutting the size of the employees a company may have. This is especially beneficial to small

Emma’s and Tom’s, Pty 9
sized companies since it helps them cut unnecessary costs. In addition, the accuracy that
accounting systems have is precise and their errors will, in most cases, only be based on the
original entries by the user of the system. Automated systems as well allow business to grow with
little or no additional infrastructure and human capital. This makes automation systems ideal for
most companies. However, these systems have as well their disadvantages which include the
challenge the management of a company may face in case it may want to control the flow of the
process. However, the advantages of these systems outshine their disadvantages which make
them ideal for many companies.

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REFERENCES
Anon, (2017). [online] Available at: http://netsuite.com.au/portal/au/ [Accessed 11 Sep. 2017].
Emmaandtom.com. (2017). Emma & Tom's Look After Yourself | The Best Fruit Juice you'll
Taste by far. [online] Available at: http://www.emmaandtom.com/ [Accessed 11 Sep. 2017].
Epicor 2016, 'Choosing the Right ERP System to Support Your Business Growth Plans',
Newspaper, Penton Media, Inc, Cleveland.
Mierzejewska, W 2014, 'Directions of Changes in Organizational Structures of SME - Results of
Empirical Research', Foundations of Management, vol 6, no. 3, pp. 83-92.
Sisney, L 2013, Organizational Physics - The Science of Growing a Business, 1st edn, Elaine
Johnson, Santa Barbara.
Trends.builtwith.com. (2017). NetSuite Customers and Market Share. [online] Available at:
https://trends.builtwith.com/cms/NetSuite/Market-Share [Accessed 11 Sep. 2017].