Electronic business, more commonly termed e-Business, is revolutionising the way in which companies operate in a business-to-business environment. However, to benefit fully from such developments a business must fully understand its own internal processes and clearly set out a process plan that creates a robust platform upon which the re-engineered business can be developed. Catnic, a manufacturer of steel building materials, understood the importance of reworking its business from the inside out, which is why it asked e-Business and supply chain integration expert SSI to install its TROPOS enterprise resource planning software.

Catnic, which is part of Corus (formerly British Steel), manufactures and markets steel building products through builders merchants throughout the UK and into a number of export markets. The company’s steel lintel has become the generic for the industry but Catnic also sells fence post support systems and plasterers’ beads and building components. With over 5,000 product lines and industry demands for speedy delivery, inventory management and warehousing information are particularly important issues to a company like Catnic. The company not only undertakes daily despatches on an international basis but also receives raw materials on a just in time basis.

IT Manager Wendy Reed explains that the company was using an AS/400-based system to manage business processes across the enterprise, but the software presented the company with a millennium compliance issue. The old system was also too inflexible to meet Catnic’s major business need, which was to reduce the time taken between order entry and dispatch.

When Catnic decided to replace the old system the company knew that it needed someone who could supply skilled people as well as quality technology. “We were a small MIS department with very little bespoke development and we wanted that expertise to be contracted in,” says Reed. “Moving from a green screen to a Windows environment was a radical change for us.”

It was with this requirement in mind that Reed first came into contact with SSI in March 1998 when she sent out a tender invitation to thirteen companies, and shortlisted four of them through the use of an Access database that weighted the proposals against 150 separate requirements. This process whittled the supplier base down to two. “One of the reasons that SSI was the preferred supplier was that it was far more flexible. It obviously met our key requirements,” comments Reed. “Being able to form a working relationship is of equal importance and it became clear that SSI was a partner we could work with” SSI scored 14% higher than the second most likely supplier during Catnic’s highly methodological evaluation phase. Consequently, Catnic signed with SSI in September 1998, and took advantage of the software supplier’s facilities management expertise as part of the deal.

Phil Homer, SSI’s Project Manager who was responsible for the Catnic contract, was quickly able to understand the manufacturer’s main business problem. One of the most difficult areas for the manufacturer was its dispatch process. “It has a huge yard at the back full of lintels, and it supplies to order,” he says. “Managing this task is complex because of the scale of the stock and the required response time.”

The company altered the format and sequence of the dispatch documentation to make the dispatch process easier, and Reed proved to be a model customer here. Her team did a lot of the re-engineering in collaboration with the business managers. This meant that by the time SSI came to put its Talisman business process re-engineering methodology into practice, Catnic already had a clearer understanding of its internal workflow than most
Consequently, it was relatively straightforward to map Catnic’s business processes to the functions within the TROPOS software. “By the time we got there, we knew what we wanted to do and what we could compromise on.” Guidance from SSI helped a lot during this process.

After the two companies had reached a complete understanding of how the TROPOS software could manage the various processes underlying Catnic’s business, it was time to go to work. SSI traditionally introduces a Business Simulation to test its system design in practice using sample data sets. The Talisman approach delivers a set of documented procedures that can be used in the Business Simulation and subsequently in end-user training.

The pilot ran for six weeks, according to Reed, and it gave the company the chance to iron out any last-minute wrinkles in the system. The biggest hurdle was data transfer, because the company had changed the structure of its data during the re-engineering process. “We were lucky in that SSI has a tool called Batch Load Wizard, which makes implementation and changing the fields on tables a lot easier than it would otherwise have been,” says Reed. The two companies also ran a second and third simulation to ensure that the live system would run smoothly, and finally went live in August 1999.

The live system includes all of the TROPOS product modules, alongside SPEX, a product from Kewill that handles export documentation, CODA which handles the financials and PowerPlay from COGNOS, which handles reporting for sales analysis. The latter product pulls data out of a data warehouse based on a SQL Server database that merges new data with legacy data from the old AS/400 system.

From a staff perspective, though, the most visible benefit of SSI’s implementation was the customisability of the system. The Software Developer's Kit within TROPOS enabled Catnic to develop an ad hoc sales order entry front-end that handles its highly complex discount structure. “With the power of the Developer's Tool Kit you can do some exciting things without compromising standard functionality,” says SSI’s Homer.

Other customisation features sold by SSI as part of the solution enabled Catnic to tailor other aspects of its front-end. Formscape, a white paper printing product, enabled the company to develop business forms that mirrored its processes more effectively, for example, minimising the learning curve for Catnic’s staff.

All this new functionality is running on five Compaq NT servers over an Ethernet network. The largest, runs the core TROPOS application. The others include a Lotus Notes server and a remote access server, while machines are also needed to run the COGNOS software and other specialist applications including contact management software from Saleslogix, which Reed plans to support with data from a SQL Server database.

As expected the project has reduced the company's cost of operation, according to Reed. “As customer service is an obsession of ours, this will also enhance our ability to deliver orders complete and on-time,” she says. And the development won’t stop there. Now that it has tightened up its internal processes, Catnic wants to deal with its business partners more effectively, too. Reed is considering the introduction of bar coding facilities in the warehouse to make product tracking easier.

Using this facility, TROPOS transactions will be downloaded to radio-enabled palmtop bar-code readers, which will then feed back events in the yard to the central software, enabling it to maintain a real-time picture of events in the warehouse. This will help the company to make its product picking methods more efficient. “Along with the obvious benefit of stock accuracy it also enables us to pick the right product for the right customer more effectively,” says Reed.

SSI is also working with Catnic on an e-Business system, of which the first part will be Internet-based links to hauliers, enabling them to plan their delivery routes much earlier. Step two will allow its retailers' stores throughout the country to enter orders on-line. In a move to enhance its supply chain integration further, Catnic will also create direct links with larger customers, and this will require the introduction of a customer relationship management (CRM) system, which SSI will also be providing.

“If you're a large merchant with number of branches throughout the country then ordering electronically will enable the customer to ensure not only the correctness of the information but also consistency across the organisation,” says Homer. This presents a complex customer relationship management problem, because the records must be reconciled. One particularly challenging issue here is discount management, which means that the CRM system must tie into the finance system.

The system has worked so well for Reed that the company plans to roll out the stock control and order entry modules to its German subsidiary. “It will enable us to see how much stock they are holding out there and therefore plan far better the requirements on UK manufacture,” she says. This process has traditionally been managed using manually maintained spreadsheets.

It is clear that Catnic’s relationship with SSI will be a long and prosperous one. The synergy between the two companies means that together, they can produce business benefits that will put the manufacturer in a very competitive position. The success of this contract is an example of the way in which quality software and technical expertise can create rock solid foundations.