A life sciences company backed by Third Rock Ventures* had ambitious plans for going public and achieving rapid growth. At its inception, the company managed its finances and reporting on QuickBooks. The VP of finance says, “QuickBooks is a fantastic application, but it had none of the controls we needed.” Having experienced several ERP deployments and other large-scale technology projects in other businesses, the VP was certain that NetSuite would be a good fit for the company’s requirements. “NetSuite would enable us to exercise financial control,” he says. “It was a cloud-based solution that would be easy to implement and use, and which we could manage with a small team.” Several other companies in the Third Rock Ventures portfolio were already using NetSuite to their advantage.
In preparation for going public, the company had to strengthen controls and implement financial approval workflows. First, it had to identify a technology partner to facilitate the NetSuite deployment. The VP of finance says, “People we knew in other organizations recommended that we contact Sikich. This consultancy had already implemented NetSuite for life sciences companies many times. They obviously could offer a lot of valuable experience, and we expected that they could help us accomplish a smooth NetSuite deployment.”
The finance team scheduled a meeting with team members from Sikich’s regional office in New England. “A Sikich partner and one of their NetSuite consultants took time to meet and discuss our project,” says the company’s accounting manager. “We were highly impressed with Sikich’s ability to answer our questions and make us comfortable. It was obvious that they had successfully completed similar implementations and that ours would likely be fast and smooth.”
Once the life sciences company had decided to contract with Sikich for implementing NetSuite, the deployment was soon underway. The Sikich team began the engagement by learning about the company’s specific operating conditions and documenting its objectives and requirements for the ERP deployment. They asked the finance team to take a thorough inventory of their processes, so they could fine-tune NetSuite, for instance, to support the company’s chart of accounts, project structure, and reporting practices. The VP of finance says, “Sikich expected to pilot us through an efficient NetSuite implementation that would take twelve weeks. However, by making the best of their ERP, life sciences, and project management expertise, and by providing them promptly with all the information they needed, we went live in just eight weeks.”
The client and Sikich agreed that it was preferable to use the standard solution as much as possible and prioritize the most business-critical capabilities in the initial, fast implementation. The VP of finance notes, “My top-of-mind recommendation for anybody planning an ERP deployment is not to customize the ERP system unless it’s truly necessary. Instead, learn what the solution can help you do and put it to work. I’ve seen implementations fail when business groups ask for capabilities that are nice to have, but not critical. Such requests will lengthen the deployment and make it more complicated.”
The life sciences company went live with such foundational capabilities as a general ledger, accounts payable, journal entry booking, and reporting. “Our level of confidence in Sikich and NetSuite was very high,” the accounting manager says. “We switched from QuickBooks to NetSuite without running the two in tandem. That was a complete success.”
The finance team worked with Sikich to become proficient and comfortable NetSuite users. Then, the finance managers facilitated several brief trainings for their colleagues who needed to learn how to approve invoices and others who had to use a subset of the solution’s capabilities. When Sikich implemented the NetSuite Employee Center, which included expense management functionality, everybody in the company would interact with NetSuite for expense reimbursement. The business offered a series of lunchtime meetings where employees could learn about these solution features. “We made sure people understood how NetSuite would make their lives easier,” the accounting manager explains. “By using the new tool, they could manage their time and expense reimbursement in a single resource. That was the standard process from then on.”
Subsequently, Sikich activated additional features and refined NetSuite to address company-specific needs. One important customization Sikich created for the life sciences company involved the project accounting functionality in NetSuite. The standard solution provides for project accounting following such parameters as revenue recognition, time and materials, or percentage-of-completion (PoC). That did not quite fit what the company was looking for. “We needed the ability to track individual projects or contracts and the expenses associated with them, so we would always know when work would be performed, when we would have to pay bills, and whether we were in a prepaid or in an accrual position, based on information that we previously entered,” the accounting manager describes. “Sikich built that for us.”
The outcome of this NetSuite customization more than justified the effort. “Sikich produced a huge win for us,” the VP of finance says. “They enabled us to take control of complex projects where billing payments and milestones did not necessarily correlate to expense recognition. We can see and report on the status of projects with accurate balances. Bills and expenses are correctly booked to their projects, and all project information is connected to the statement of work for any given project.”
Customizing the project accounting module also helped streamline audits. The controller comments, “We’re managing between 60 and 80 projects at any time with a lean team. Because Sikich created the right project tracking for us, it’s easy for auditors and us to verify what our positions are and have complete confidence in the information we see about balances and other project details.”
Seven months after the NetSuite implementation, the life sciences company went public. NetSuite was invaluable when it was time to provide the SEC with a form S-1/A with amendments to the earlier Form S-1. The VP of finance says, “The reports we produced in NetSuite made filing the S-1/A form a lot easier than the initial S-1, and we were able to create reports that presented financial information exactly as we wanted to show it.”
Since the initial implementation, the life sciences company has grown to more than double its size in employee numbers. The finance team also increased, and so did operating expenses. More than sixty individuals use NetSuite invoice-approval workflows.
Except for asking for help from the IT group to implement single sign-on, the finance group has managed NetSuite on its own—including periodic upgrades and enhancements. Sikich provides guidance and practical assistance, for instance, when the company wants to ensure optimal outcomes from a software update or when functionality has to be adjusted. The consultants helped their client integrate Adaptive Insights software with NetSuite to enhance forecasting and budgeting. They also scoped and addressed control shortfalls with Strongpoint, a solution that augments the NetSuite environment with proper segregation of duties and enterprise-level controls.
The accounting manager says, “With occasional support from Sikich, we’re proudly managing NetSuite on our own. What has made a huge difference in our implementation and during years of using NetSuite is that we’ve been able to work consistently with the same Sikich life sciences and ERP experts. They are completely committed to our success and know us very well. Our Sikich team listens to our ideas, offers advice, and is usually several steps ahead of us in anticipating potential issues and offering solutions for them. Their proactive collaboration and forward-thinking is what makes it possible for us to run NetSuite without help from IT.”
The life sciences company recently began accounting for clinical studies, using the customized project functionality created by Sikich. Statements of work and contracts related to clinical studies can be managed and reported in NetSuite much like the company’s other projects. The VP of finance comments, “We can easily track our clinical-study spending and determine our accrual and prepaid positions, using the same Sikich-built functionality that we originally used to track research and manufacturing contracts.”
Project-manager commitments are signed on printed forms whose information always connects to data in NetSuite. “By tracking project finances and documenting all details in NetSuite, we can be assured that our accruals and expenses are accurate when we close the books,” the accounting manager adds.
For the foreseeable future, NetSuite as the financial management solution and Sikich as the preferred technology partner will continue serving the life science company. When company leaders talk to their peers in other organizations, they often recommend both Sikich and NetSuite.
“Don’t engage technology consultants who learn while they work with you or lack understanding of your business,” the VP of finance says. “Find a business partner who knows your industry and has an excellent reputation—like Sikich is for us. They were always available when we needed them, understanding what we were asking for and getting it done quickly.”
*Our case study is based on an interview with the company’s accounting manager and VP of finance. For legal reasons, the company cannot allow its name to be published here.
©2023 All Rights Reserved. Privacy Policy Disclaimer
