Profit Magazine - February 2008

Case in point: the company offers its customers a lifetime warranty on fly rods. If they break a piece off, they can send them back for repair. Merging warranty processes into the company’s order system wasn’t easy. At first, Sage simply made modifications, but they didn’t allow true integration with the Oracle system. Oracle was able to go in and suggest a better way to manage customer needs, says Barrett.

“When asked about how we could improve the warranty process, the folks from Oracle suggested that we explore several different solutions. They suggested we use the Order Management module with Assemble-to-Order and set up some limited number of warranty SKUs [stock keeping units] that would have alternate BOMs [bills of material], which would allow us to keep a similar business process while utilizing the full capabilities of Oracle E-Business Suite. The continual follow-up and interaction that we’ve had from Oracle folks in the area, in our region, has been definitely beyond what I would expect from a company of Oracle’s size,” Barrett says. “They’re great resources for us to interact with, and they provide us with good insight. They care about what we’re doing; they care about us as a customer.”

For Life Data Labs, the return on investment (ROI) comes from both reducing necessary head count and offering its customers better service and support.

“We’ve gone from three people to two people in customer service, and those were two people in customer service that, at the end of the system that we retired, basically were working overtime with the third person and couldn’t get it all done,” explains Kutz. “We’ve been able to maintain an increase in production with the same three people we had in the back before the new software.”

“The reality of it is, while my personnel budget didn’t go down, it’s not going up either. I’m able to fulfill more orders, I’m able to deal with more distributors, I’m able to deal with more customers, and I’m doing it on the same personnel budget,” says Kutz. “My revenue’s coming in, and I’m not increasing my costs to match it, except for cost of goods and such. So my business overhead is not going up as my sales are going up. Profit margins have gone up too.”

Su-Kam’s benefits reached all the way into its warehouses.

The company found merchandise that it didn’t know it was carrying. Today, the company knows exactly what’s in its 10 warehouses at all times, cutting down on the need to overproduce or stock excessively. It also knows exactly how many parts and components it has down to the SKU number, so when it starts phasing a specific item out, the company can sell off all of its remaining inventory immediately at higher prices rather than selling piecemeal as items are discovered. And the items the company sells are delivered on time because there’s no lag between order entry and fulfillment, says Kumar.

“All of the processes have been simplified now. My purchase guy doesn’t have to follow up with my account guy for the payment. My vendor doesn’t have to follow up with my account department for the payment. It’s all online, and everything is comfortable now,” he says.

Su-Kam realized a full ROI within a year, says Kumar, and will continue to see financial benefits as the company grows.

For Sage, a significant part of the return comes from allowing its IT staff to offload all the mundane tasks they were charged with to keep the old system running. Before switching over to Oracle, the IT staff spent between 75 and 90 percent of its time supporting the software and infrastructure. Today, the staff spends 25 percent of its time on support, leaving the bulk of the week for operations projects and improvements, says Barrett.

“It allows our IT folks to focus on
new projects or initiatives, or new types
of reporting,” he says. “Today we’ve been
able to increase our peak shipping—the

number of orders we can process—by 100 percent. Oracle’s products are definitely helping to make that happen.” <>

>>SNAPSHOTS
Life Data Labs
www.lifedatalabs.com
Location: Cherokee, Alabama
Employees: 12
Revenue: US$5.7 million
Oracle products and services:
Oracle E-Business Suite 11i, Oracle
Enterprise Linux, Oracle Database 9. 2
Other products and services:
Consulting services from
SkyBridge Global

Sage Manufacturing
www.sageflyfish.com
Employees: 150
Location: Bainbridge Island,
Washington
Oracle products and services:
Oracle E-Business Suite, includ-
ing Order Management, Accounts
Payable, Accounts Receivable, Cash
Management, General Ledger; Oracle
Discoverer; Oracle Database 10g
Other products and services:
Dell PowerEdge 2800, Red Hat
Enterprise Linux 4, consulting
services from Blue Gecko

Su-Kam Power Systems
www.su-kam.com
Location: Haryana, India
Employees: More than 200
Revenue: US$100 million
Oracle products and services:
Oracle E-Business Suite, including
Financials, Inventory Management,
Purchasing, Order Management,
Advanced Pricing
Other products and services:
Consulting services from
Sonata Software