Tech Challenges in the Phases of Life Sciences Organizations
- Ghostwritten by Nayeli Rios for Sikich LLC
- 5 Minute Read
Jul 19, 2024
What You’ll Learn from This Blog:
How Startups Keep Things Running Smoothly
Learn how life sciences startups juggle fast-paced growth with small teams, simple tools like QuickBooks and Excel, and flexible processes to get the job done.Knowing When It’s Time to Level Up
Find out why startups often outgrow basic systems faster than expected and how switching to NetSuite early can make life easier as they scale.Tools That Actually Work for Life Sciences
Discover how Sikich Suite Success is designed specifically for life sciences companies, offering features like automated purchasing, better expense tracking, and streamlined approvals to keep up with growth.
Tech Challenges in the Phases of Life Sciences Organizations
When a Life Sciences company first starts out, the business often moves at a very fast pace. Developing strong business processes is important, but during the startup phase, the primary focus is on innovation. This forward-thinking approach is especially crucial with a lean team where everyone wears many hats across the organization.
For example, in finance, one person may handle all the books, including booking journal entries and paying bills. Additionally, the company might outsource all its IT services.
With individuals wearing many hats, there is a multitude of business processes in play. Since these processes are not yet clearly defined, different team members may handle similar tasks in various ways. At this stage, this is acceptable because your transaction volume is light, making manual processing manageable and your team’s adaptability a key strength.
Common Business Systems in the Startup Phase
Ironically, life sciences startups often do not choose an ERP as their first business system. Instead, they opt for simpler solutions like QuickBooks due to its ease of use and suitability for low transaction volumes. Additionally, many organizations use Excel in an ERP-like fashion to fill gaps that QuickBooks cannot cover.
The problem with QuickBooks is that organizations often outgrow it faster than anticipated. This forces them to start a new system selection process, identifying QuickBooks’ limitations and considering their future business needs.
The latest trend in the industry is to move to a more sophisticated ERP system, like NetSuite, much earlier in the business lifecycle. Companies are now proactively recognizing the benefits of a robust ERP system and implementing it sooner than before.
From an FP&A perspective, startup companies have requirements similar to those of larger organizations but on a smaller scale. This often leads them to rely on Excel for budgeting, forecasting, financial reporting, and tracking departmental burn rates. In the startup phase, it’s usually the finance team that maintains these FP&A requirements, which is manageable for a time. However, this approach will no longer be sufficient as the company grows.
Procurement Systems
From a procurement perspective, this is where we see the most significant variations among life sciences organizations. BioProcure/Prendio is one of the more popular systems, and we at Sikich have established a strong partnership with them and developed a NetSuite/Prendio integration.
Other procurement options focus primarily on scientists and lab suppliers, providing automation to help smaller companies streamline their purchasing processes. Scientists are often extremely busy working on their startup drugs. Despite this, most organizations develop a relatively complex approval matrix early on, typically managed through manual methods like email communication and paper sign-offs.
The Value of Sikich SuiteSuccess for Life Sciences
Adopting an ERP system can be a game-changer for your life sciences organization, saving you valuable time. Sikich Success for Life Sciences is more than just NetSuite—it’s a collection of leading practices tailored specifically for the life sciences and biotech industries. Our focus is on swiftly deploying your ERP system, aiming for a timeline of eight to ten weeks, a significant improvement over, the typical three to six months for implementation. Our approach is grounded in industry-specific best practices.
For example, we streamline approval processes for services and lab supplies within procurement. Sikich Success for Life Sciences automates business operations to manage high transaction volumes in accounts payable, enabling precise reporting of general and administrative expenses versus research and development costs. Furthermore, it facilitates detailed tracking of program or project expenditures at a granular level.
SuiteSuccess for Life Sciences is built on the robust NetSuite platform, providing all the functionalities you need to support your organization throughout its lifecycle.
The core functionality:
- Company Structure
- Segment Strategy and Automation
- Approval Processes
- Role Management
- SEC Financials
- System Audit
- Vendor Study Management
- Prendio Connector
- Vendor On-boarding
With companies adding on the following functionality as well:
- Procurement
- Purchasing Change Orders
- Document Management
- Expense Management
- Fixed Assets
- Item/Product Management
Next Steps
After the startup phase for life science organizations comes the IPO phase, which will be covered in the next post. Have any questions about the startup phase for life sciences? Please reach out to us at any time!
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