Welcome to the Fall 2008 edition of the Datalliance Newsletter
It’s hard to believe that we are already into the fourth quarter of 2008. The past several months have been as busy as usual at Datalliance. As the world’s largest independent VMI service provider, we are now processing over $4.8 billion in orders, 10.2 million SKUs, and 25,300 locations. Those are pretty impressive numbers, but we are constantly looking for ways to expand and improve our VMI service. In addition to our regular enhancements to our VMI service, data center, Customer Care, and education sessions, we have also made some exciting announcements over the past few months:
Our customer base continues to grow and to have great success with their VMI program implementations. In the “news” section below we introduce some of our new customers: Lithonia Lighting, WIKA Instrument Corporation, and Ward Manufacturing. We also have articles documenting the success that Berk-Tek and Haldex have received with their Datalliance VMI programs. It is especially gratifying to see these existing customers realize significant value from VMI. I’m sure you will enjoy reading about their success.
Mark your calendars for May 5-6, 2009 for the next Datalliance User Forum to be held in Cincinnati. We’ll be getting you more information in the near future but wanted to make sure you got this event on your calendar.
I encourage you to continue to provide us with input on topics for future editions of this newsletter. Please feel free to contact me at firstname.lastname@example.org with your ideas and suggestions. Please visit www.datalliance.com for more information on Vendor Managed Inventory and Datalliance.
Berk-Tek Realizes Significant Results from VMI with Largest Distributor
Berk-Tek is a unit of Nexans, a global cable and cabling systems industry leader. Berk–Tek manufactures high-performance fiber optic and copper structured cabling products for use in LAN, SAN and data center installations. The company produces over 20,000 different SKUs in three manufacturing plants located in Pennsylvania and North Carolina. In North America, Berk-Tek products are sold primarily through franchised distributors.
Prior to implementing Vendor Managed Inventory (VMI) with Graybar, one of Berk-Tek’s largest distributors, the two companies used a traditional approach to order processing and inventory management. Paul Trunk, Berk-Tek Senior Vice President of Sales & Marketing, states “When the distributor initiates their own replenishment orders, the process is labor intensive, prone to error, and generally not ideal for a large distributor. We were looking for a way to improve our process to eliminate human error, reduce time and effort for both our distributors and Berk-Tek, and gain better visibility of demand.”
Graybar was having success doing VMI with other suppliers and recommended that Berk-Tek evaluate using the VMI approach. “Graybar suggested that we consider setting up a VMI process with them, but only if we determined it would also be valuable to us,” explains Trunk. Graybar also suggested that Berk-Tek look at Datalliance as a possible solution if they decided to proceed with VMI.
One of the most valuable results of Berk-Tek’s VMI program has been an increase in sales in just one year. “We have experienced a significant increase in sales, and I attribute this somewhat unexpected increase, in large part, to our use of VMI,” states Trunk. “At the same time that we were increasing sales, we also enhanced our market share within Graybar by increasing the number of active SKU’s over 18%. Inventory turns improved nearly 30% and stockouts were reduced to an all-time low of 3.1%, which tells us that VMI is helping us to run our business more effectively. We are extremely happy with these results in such a short period of time.”
Commenting on the SaaS approach with Datalliance, Lisa, Berk-Tek S&OP Business Analyst Taranto says, “Implementing the Datalliance VMI service has been a breeze compared to systems projects where we had to install and set everything up ourselves Another benefit of Datalliance is that it is enhanced several times a year with no effort or disruption on our part at all. New capabilities are available instantly – it’s great!”
Summarizing the strategic benefits of VMI, Trunk says, “VMI has definitely helped to further solidify our relationship with Graybar. They’ve trusted us to manage their inventory and have been very pleased with the result. Based on our results from VMI, we’re now making plans to expand our deployment to more distributors as soon as possible.”
News & Announcements
Lithonia Lighting Selects Datalliance Vendor Managed Inventory
Detailed sales information provided by VMI to help determine most profitable product mix for distributors
Industry reputation and Software as a Service (SaaS) model make Datalliance clear choice for VMI
Datalliance announced that Lithonia Lighting, an Acuity Brands Inc. lighting business, has selected the Datalliance Vendor Managed Inventory (VMI) service. Lithonia Lighting will initiate their VMI program implementation with a pilot distributor site and then will roll out VMI to a select base of distributors who have expressed interest in the benefits of VMI.
George Stringer, VP Distributor Value Stream, Lithonia Lighting, explained, “We looked at several VMI options, but it became clear very quickly that Datalliance was the best solution for us. They have a great reputation in the industry and are trusted by our distributors who are already doing VMI. The Software as a Service model employed by Datalliance is a perfect fit for our strategy. A quick implementation time frame and no significant investment in hardware and software is very appealing to us.”
Ward Manufacturing Selects Datalliance Vendor Managed Inventory
Datalliance VMI will accelerate implementation of new VMI customers and improve service to existing customers
VMI positioned as strategic tool to build partnerships with customers, grow sales and improve profitability
Datalliance announced that Ward Manufacturing, a leading manufacturer of pipe fittings, has selected the Datalliance VMI service. Ward Manufacturing maintains offices in Canada and the US and sells its products to a network of more than 600 wholesalers throughout North America.
Matt Weigle, Manager – Information Technology, Ward Manufacturing, explains, "…By selecting Datalliance, we will be able to eliminate the time consuming elements of the process (bringing new customers up on VMI) and rely on their expertise. Their software-as-a-service architecture and extensive VMI experience allows Datalliance to assume a majority of the effort required to effectively maintain our VMI environment, and also provides greater agility in implementing new customers. Through this partnership with Datalliance we will realize a reduction in IT resources needed to manage VMI, thereby lowering our costs and allowing us to focus on our core business and other value-added opportunities."
“From a sales and marketing perspective, we are anticipating traditional VMI benefits, including increased sales, reduced order errors, improved turns for our customers and expanded product penetration,” states Tibor Egervary, VP Marketing & Sales, Ward Manufacturing. “Just as importantly, I expect our Sales staff to use Datalliance VMI as a strategic tool to build partnerships with customers who value not only our products, but our support services as well…”
WIKA Instrument Corporation Selects Datalliance Vendor Managed Inventory Service
VMI to complement Lean Manufacturing Initiative
WIKA is leading supplier of industrial pressure & temperature instrumentation
Datalliance announced that the United States operations of WIKA Instrument Corporation (WIKA),a leading supplier of industrial pressure and temperature instrumentation, has selected the Datalliance Vendor Managed Inventory (VMI) service. WIKA USA will utilize Datalliance to provide VMI services to the company’s industrial distribution customers as well as OEM customers and WIKA’s sister division in Canada.
“We’ve had excellent success with our Lean Manufacturing initiative and we see VMI as the next logical extension of that process,” explained Michael Gerster, WIKA USA President. “We’re very focused on customer service and respond as quickly as possible to their needs. Today, our on-time delivery performance exceeds 97% but it’s sometimes resource intensive, and therefore less efficient, to meet short term demand for our complex configuration of products. VMI will help us reduce demand volatility and enable more efficient production. By gaining a better view of actual demand, we can be more proactive in planning level production through our manufacturing cells. This will make us more efficient and ultimately allow us to deliver greater value to our customers.”
Haldex Saves Time and Effort with Datalliance VMI
Haldex realized the value of VMI but their in-house system was difficult and expensive to operate
Input from other industry leaders led Haldex to select Datalliance VMI
Initially, Haldex thought the best way to implement VMI was to install and operate an in-house system. Bryan Long, Haldex Business Development Program Manager, recalls the problems with that early approach, “We selected a commercial VMI software package to be implemented on our in-house servers. Before bringing up any distributors, we had to install and test the software and try to build internal technical expertise specific to the software package. This time was really wasted in our effort to get VMI up and running with key distributors. In the end, we concluded that we were spending way too much time managing and maintaining our VMI system rather than focusing on developing our business relationships and growing sales with our key distributors.”
Moving to the Software as a Service (SaaS) model used by Datalliance was a significant decision factor for Haldex. “The SaaS approach made a lot of sense to us,” says Long. “Because Datalliance is a service, we don’t have to deal with all the issues of managing and maintaining the software and the associated data. This has eliminated our need for an internal IT resource dedicated to VMI system support and allowed us to focus on getting VMI up and running with key distributors.”
Haldex and their distributors are already realizing substantial results from VMI now that Haldex has moved to Datalliance. “A good example of the potential of VMI is what we’ve been able to do with Point Spring Company, one of our primary distributors,” explains Long. “In less than a year we’ve increased sales 33%, expanded our product offering carried by Point Spring by 61%, and increased their inventory turns 23%. These are exactly the results we were looking for with VMI.”
Datalliance to Acquire and Manage HDeXchange
Move Expands Datalliance e-Commerce Services for Heavy Duty Truck Parts Industry
Datalliance announced that it will acquired the assets of HDeXchange, Inc. (HDX), a provider of e-commerce solutions to the heavy duty truck parts supply chain, and will assume control of all activities related to both HDeXchange, and its wholly-owned subsidiary, HDX Services. HDX will continue to operate as the industry’s voice for electronic commerce initiatives, as well as maintain its full suite of services, but with the financial backing of Datalliance. Datalliance will retain Edward Kuo as Executive Director on a long-term basis, and the services of the current HDX Board of Directors on a short-term basis.
“Datalliance has been one of HDX’s best supporters over the years as both a customer and a vendor partner, so this is an ideal fit,” said Jay Johnston, Chairman of the HDX Board. “HDX will benefit from the years of experience Datalliance has in running a technology-based company, as well as the additional strategic and financial resources it brings to the table….
Datalliance Announces New Sales & Inventory Optimization Solution for Retail Channels
Datalliance Sales Insight Monitors Store-Level SKU Activity to Enable Suppliers and Retailers to Collaboratively Manage Inventory and Grow Sales
Solution is Already in Use by Leading Manufacturers Such as Siemens, Schneider Electric, Legrand, Ideal, Eaton, and Other Suppliers to Home Depot, Lowes, and Other Retailers
Datalliance announced immediate availability of a new sales and inventory optimization solution branded Datalliance Sales Insight. Sales Insight monitors store-level SKU activity to provide clear, actionable information that enables manufacturers to work collaboratively with retail channel partners to grow sales. Offered as a web-based ‘on-demand’ Software as a Service (SaaS) solution, Sales Insight is already in use by leading manufacturers such as Siemens, Schneider Electric, Legrand, Ideal and Eaton working with retailers such as Home Depot, Lowes, and others.
“Datalliance Sales Insight provides us actionable information to drive improved performance with key retailers like Home Depot. With the information they provide, we are able to better understand Home Depot store level activity, product effectiveness and overall performance,” said Jeff Richter, National Account Manager, Eaton Corporation. “We’re very happy with the overall service from Datalliance.”
“We’ve developed Sales Insight for situations where the retailer is not yet ready to have the supplier directly replenish store inventories using VMI, but where they are ready to work collaboratively with the supplier to better manage inventories and grow sales,” said Carl Hall, Datalliance President and CEO. “Sales Insight performs many of the same functions as our VMI service, other than replenishment ordering, while providing a comprehensive report set designed specifically for the retail environment.”
Industry Leaders Discuss Strategic Value of VMI at IDEA E-Biz Forum 2008
Hubbell Inc., Leviton Manufacturing, and North Coast Electric executives participate in panel discussion on Vendor Managed Inventory (VMI)
VMI identified as strategic e-commerce application to help both suppliers and distributors grow their businesses
At the recent IDEA E-Biz Forum 2008, held in Washington D.C., industry executives from Hubbell Inc. (John Riley, eMarketing Director), Leviton Manufacturing (Mark Richards, Director, eCommerce) and North Coast Electric (Rick Bumpus, Executive VP, COO) participated in a panel discussion on the strategic business benefits of Vendor Managed Inventory. The panel was led by Tom Hoar, Director of Sales, Electrical, Datalliance. IDEA's annual event, the IDEA E-Biz Forum, brings in top experts to share their expertise and insight on how to grow a company's bottom line and increase productivity through eCommerce programs and technology.
Mark Your Calendars for Datalliance User Forum 2009, May 5-6
Datalliance will host a User Forum for both suppliers and their customers (e.g. distributors, retailers, OEMs, and product end users), on may 5-6, in Cincinnati, Ohio. Mark your calendars now for this valuable event. Attendees share experiences through interactive panel and discussion sessions, gain insights from industry experts, and learn about new and planned capabilities of the Datalliance VMI service.
Datalliance Operations/Data Center Update – Datalliance Weathers the Storm!
In mid September, Cincinnati was impacted severely by the remnants of Hurricane Ike with extensive power outages throughout the entire region. Blue Ash, Ohio (our office location) was not spared, however our disaster recovery systems were implemented successfully and our systems continued running normally, with no interruption. We did have a challenge with our staff members getting to the office for several days, but all support services were maintained throughout the entire outage until normal power was restored.
Customer Care Tip
One thing you no doubt know by now is that Exceptions Happen! Datalliance VMI identifies exceptions and categorizes them for your review via OP Management, Product Activity (PA) Errors, and Alerts. Datalliance VMI is designed upon the premise that mutually agreed to performance objectives will be set and that the replenishment model will be configured to meet these objectives so that a large percentage of replenishment decisions are made automatically, leaving the Planner to monitor exceptions only. With all of the different types of exceptions that are identified and reported, it can be a challenge for Planners to approach and handle exceptions in a consistent and efficient fashion.
The Datalliance Customer Care Team has developed a “mantra” for the approach to sorting out and dealing with all of the exceptions that are identified by the Datalliance System. The exceptions mantra is Investigate, Collaborate, Adjust, and Document (or ICAD for short). This simple, 4-step process, when followed, ensures that all types of exceptions that the system identifies will be dealt with consistently, completely, and in a manner that strengthens VMI relationships and replenishment decisions.
Throughout the course of the year, Datalliance participates in a variety of industry conferences, seminars, and trade shows. Listed below is a schedule of events for the coming months. If you are planning on attending any of these events, be sure to look for Datalliance.