The Situation

The client operates five branded storefronts selling automotive, marine, powersports, and off-road parts, all pure dropship, at roughly $100M in annual revenue. Years earlier, the company had implemented Microsoft Dynamics ERP with a strong order integration: every sale flowed into the system automatically, and that pipeline never stopped running.

Everything else did.

The monthly close ran entirely in Excel, maintained by a capable finance team working around a system that had quietly stopped functioning as an accounting platform. The ERP system had become an order log.

The Diagnostic Finding: A Dated Abandonment Cascade

Rather than treating the system as generally broken, DMW Advisory dated exactly when each accounting function went dark:

• 2017: Purchase order closeout stopped
• 2018: AP payments stopped posting
• 2021: Receipt posting froze
• 2023: Sales posting and the general ledger froze entirely

Meanwhile, purchase order and sales order creation ran continuously through the present day. The result: millions of live sales orders sitting on top of an empty general ledger. No fiscal year had ever been closed. Cost of goods sold had effectively never posted.

Dating the cascade mattered because it settled the single most important strategic question of the engagement: whether to repair history or draw a line. With the accounting layer non-functional for six to nine years while operations ran live, historical ERP data could not serve as a foundation. A clean cutover with reconciled opening balances was the only viable path, and the diagnostic proved it with evidence rather than assertion.

The Root Cause Nobody Had Found

Accounts payable had “never worked” in the ERP system, a fact the organization had absorbed as a given. The diagnostic traced it to a specific, fixable root cause: the purchasing default posting accounts were never assigned during the original implementation.

Findings like this changed the tone of the engagement. The prior implementation was not a bad design poorly conceived. It was a good design left incomplete, which meant the path forward was completion, not replacement.

What DMW Advisory Delivered in Phase 1

A fixed-fee, three-week diagnostic produced:

• ERP current-state assessment with every abandonment dated and evidenced from system data
• Chart of accounts redesign. The legacy chart had payment processors and vendors hardcoded into natural accounts, ballooning it past 1,000 rows. The redesign moved channel and processor to native ERP dimensions, cutting the chart to a maintainable core without purchasing an additional module.
• Reconciliation methodology defining the source of truth for revenue and COGS in a form that supports lender and audit review
• Variance recovery accrual methodology. The order-to-settlement matching process surfaces roughly 3,000 exceptions per month. DMW Advisory designed a two-phase methodology: recoveries coded to reason and booked to origination month first, then a rate-based auto-reversing accrual once coded outcomes stabilize the rates. No estimation without evidence, no close delay.
• Build gap classification across every end-state workflow: built, partially built, or not started, with the data inputs and technical work each requires
• Opening balance and cutover approach, including identification of the single gating balance sheet item requiring substantiation before cutover
• Phase 2 implementation plan with timeline, milestones, and resourcing

Measurable Impact

• Implementation discipline established: a fully licensed sandbox environment, all system writes through supported integration paths only, and the finance team positioned as design partners rather than migration subjects.

Why It Worked

Three principles carried the engagement:

• Evidence before plans. Every finding was dated and sourced from system data. The strategic recommendation (clean cutover) followed from proof, not preference.
• Diagnose before pricing. Phase 1 was a fixed-fee diagnostic; the implementation fee was scoped jointly only after the build gap was fully classified. Neither party priced work that had not been seen.
• The finance team owns the outcome. The close belongs to the team that runs it. Every methodology was designed in working sessions with the VP of Finance, built to survive after the engagement ends.