Customer Solution Case Study
/ / Custom Truck Accessories Maker Lowers Costs, Sees Bright Future with New ERP Solution
Overview
Country or Region: United States
Industry: Manufacturing
Customer Profile
Panelite, Inc. manufactures decorative truck light panels, supplying original equipment manufacturers, including Kenworth, Freightliner, and Volvo, as well as dealerships.
Business Situation
Tardy factory orders threatened Panelite’s competitive position and viability as a business partner.
Solution
Tapping the expertise of Microsoft® Certified Business Solutions Partner mcaConnect, Panelite implemented Microsoft Business Solutions–Axapta® 3.0 software.
Benefits
35 percent growth and 5 percent inventory reduction
Increased cost savings and efficiencies
Integrated, easily customized system
Superior support and business partner / “We're very pleased with [Microsoft] Axapta, and it's the product that we plan to use for a long, long time.”
Peter Young, CFO, Panelite
Panelite, Inc. supplies truck manufacturers and aftermarket dealerships with decorative light panels used on class 8 trucks. Panelite needed a way to improve on-time delivery of factory orders and conform to customer electronic data interchange (EDI) requirements. Along with Microsoft® Certified Business Solutions Partner mcaConnect LLC, Panelite implemented Microsoft Business Solutions–Axapta® 3.0 software (now part of Microsoft Dynamics™), complete with support for customers’ EDI requirements. With increased visibility across the entire business and greater control over operations, Panelite is more competitive and poised for even more growth. Since implementing Microsoft Axapta, the company has experienced 35 percent growth, increased cash flow, reduced inventory by 5 percent, reduced the amount of borrowed working capital, and saved more than U.S.$100,000 in interest annually.
Situation
Panelite, Inc. is a manufacturer of decorative light panels for Fortune 50 manufacturers of class 8 trucks. Panelite supplies Peterbilt, Kenworth, Freightliner, International, Western Star, Mack, Volvo, Sterling, Utility, Great Dane trailers, and independent truck accessory dealerships with aftermarket products. Panelite has its headquarters and manufacturing plant in Oklahoma City, Oklahoma.
To manage its manufacturing operations, Panelite relied on several disparate software systems that included Epicor Avanté, a separate electronic data interchange (EDI) product, and additional batch planning and reporting packages. The system was reaching its limitations, and Panelite was concerned about long-term viability of its software providers. But the biggest issues, by far, had to do with system integration and functionality.
Panelite’s manufacturing operations system lacked the functionality or the flexibility to comply with many of its customers’ EDI requirements.
Says Peter Young, Chief Financial Officer (CFO) at Panelite, “Our original equipment manufacturer [OEM] customers have very specific requirements—for example, the ability to generate and transfer advance-shipping notices, confirmations, and invoices through EDI. To conform to some of their requirements, we had to create manual workarounds.”
A lack of system functionality and integration hindered Panelite’s ability to deliver goods on time and caused multiple problems on several levels:
The need for employees to be extremely “hands-on” to keep the business running smoothly was proving to be labor intensive; for example, one full-time employee was required to move EDI data into the company enterprise resource planning (ERP) system manually, order by order.
The use of multiple, disconnected systems made accessing critical business information difficult, and slowed decisions and hampered Panelite’s competitiveness. Young elaborates, “Without data access, we couldn’t analyze and drive the business. For example, it took us 10 to 15 days just to close the books.”
Difficulty integrating information from Panelite’s manufacturing resource planning and capacity planning software limited the ability to make quick, sound decisions. This lack of information hindered managers’ ability to adequately plan the shop, which caused costly delays in factory orders. To meet deadlines and avoid penalties, Panelite often turned to expensive overnight shipping, a practice that cut into margins.
The slightest change, such as adding a new screen or a new menu, to the ERP system was extremely difficult and expensive. Young remarks, “The smallest change forced us to hire the software vendor to program the needed changes. What company can afford to do that—continually?”
Panelite needed a solution with strong capabilities in manufacturing to support Panelite’s existing processes and information needs, a solution that would be easy to customize. Young, who had prior experience implementing ERP systems, knew that a flexible, integrated ERP solution was the perfect answer—one that would support EDI, facilitate shop floor data collection, and allow visibility into finite capacity on the shop floor. Panelite sought to reduce the complexity of their IT environment by consolidating disparate systems into a single, comprehensive business solution.
Solution
Working with Microsoft® Certified Business Solutions Partner mcaConnect, Panelite implemented Microsoft® Business Solutions–Axapta® 3.0 software. Panelite and mcaConnect implemented the solution in just over six months, during which time they also included some customizations to meet EDI specifications of certain Panelite customers.
Says Young, “This is the most complete—and the most quickly deployed—ERP system Panelite has ever had.”
Panelite now has a complete, powerful, and integrated ERP system that effectively handles production, accounting, EDI transactions, the shop floor, and more. The solution gives Panelite visibility into its business metrics, with all data residing in a single database running Microsoft SQL Server™ 2000 Standard Edition. Because Microsoft Axapta is versatile, Panelite can tailor the software to meet its business requirements.
Microsoft Axapta and the SQL Server database run on servers running the Microsoft Windows Server™ 2003 Standard Edition operating system.
Panelite uses most of the Microsoft Axapta modules, but relies most heavily on the Distribution, Finance, Supply Chain Management, and Shop Floor modules.
Microsoft Axapta met Panelite’s need for an ERP solution backed by a dependable company. “The fact that Axapta is backed by Microsoft, a reliable company with staying power, gave us a great deal of confidence,” states Young.
Panelite used a third-party solution to process and integrate EDI transactions.
Randy Garrett, Management of Information Systems (MIS) Manager at Panelite, says, “Microsoft Axapta support for third-party software is a huge asset.”
Benefits
Since implementing Microsoft Axapta, Panelite’s business has flourished. Because Microsoft Axapta helps staff to manage inventories better, the company has increased cash flow, reduced the amount of borrowed working capital, and saved more than U.S.$100,000 in interest in one year.
In addition, with Microsoft Axapta, Panelite easily meets the EDI requirements of its OEM customers. Best of all, having greater and faster insight into business metrics, and benefiting from increases in efficiency, Panelite is better poised to compete.
35 Percent Growth and 5 Percent Inventory Reduction
Since implementing Microsoft Axapta, Panelite has experienced 35 percent growth while it has reduced inventory by 5 percent or more. The company expects another 35 percent jump in business in the coming year.
For the first time ever, Panelite has everything necessary to run its daily operations in a single, integrated system. The system’s uniform code base and a single database provide managers with better access to production, sales, and other information. By using this information to make decisions, executives can respond more quickly to market changes.
Garrett says, “We know so much more about our business. Managers are able to see trouble areas faster and make decisions quickly. Axapta removes the need for manual workarounds and gives us a lot more information a lot more quickly, in a way that makes sense for managing our business.”
Adds Young, “Forget 15-day-period end closings. We now close the books in three days or less. Quicker to business insight, we’re more agile and competitive.”
Increased Cost Savings and Efficiencies
Panelite continues to reap cost savings, beginning with the U.S.$100,000 in interest the company avoided in the first year since implementing Microsoft Axapta.
Previously, one full-time employee in the customer service department manually transferred EDI data from one system to another. Now, EDI data is automatically moved directly into Microsoft Axapta, saving Panelite at least U.S.$60,000 a year.
Better able to meet factory order deadlines, Panelite avoids overnight shipping charges and penalties imposed by its OEM customers for tardy orders.
Panelite is able to tailor Microsoft Axapta and extract its data for other uses, so the company can increase efficiencies. For example, Panelite easily customized its picking and packing lists, and integrated shipping data stored in Microsoft Axapta with UPS and FedEx shipping label software. As a result, Panelite maintained the same headcount in its shipping department even as business grew by 35 percent.
Says Young, “Even with projected growth of an additional 35 percent, we probably won’t have to hire additional staff.”
By using Microsoft Axapta labor reporting capabilities, Panelite is better able to monitor and analyze shop floor activities and evaluate productivity by day, month, individual worker, or other dimension.
“We’re able to ‘slice and dice’ our data in a lot of different ways. And because Axapta is flexible, we can add or customize fields, or attach codes to the data that make sense to our business and our way of doing business,” says Garrett.
Integrated, Easily Customized System
Panelite benefits from a fully integrated system that processes EDI transactions directly into the company production database in real time. That fact, combined with the versatility that characterizes Microsoft Axapta, helps enable Panelite to meet the requirements of its factory customers.
Global partner mcaConnect transferred knowledge and skills to Panelite’s in-house IT resources. Now, Panelite easily can make its own modifications to Microsoft Axapta.
Superior Support and Business Partner
Panelite subscribes to Microsoft Business Solutions support at the Premier level. Says Garrett, “We’ve been extremely impressed with the Microsoft support. They truly do an excellent job. They respond extremely quickly regardless of the magnitude of the issue or question. They take software support to a new level, and with our business success at stake, we appreciate that.”
Panelite also has been impressed with the manufacturing expertise and software knowledge demonstrated by its Microsoft Certified Business Solutions Partner, mcaConnect. “They know manufacturing inside and out, and their success came from their consultative approach. They rolled up their sleeves and spent time getting to know the idiosyncrasies of our company. Then they skillfully applied that knowledge to great effect,” remarks Young.
With business already booming and a bright future in sight, Panelite is strongly considering adding the Microsoft Business Solutions CRM Integration for Axapta and Enterprise Portal modules. Concludes Young, “We're very pleased with Axapta, and it's the product that we plan to use for a long, long time.”
Microsoft Dynamics
Microsoft Dynamics is a line of integrated, adaptable business management solutions that enables you and your people to make business decisions with greater confidence. Microsoft Dynamics works like familiar Microsoft software such as Microsoft Office, which means less of a learning curve for your people, so they can get up and running quickly and focus on what’s most important. And because it is from Microsoft, it easily works with the systems your company already has implemented. By automating and streamlining financial, customer relationship
and supply chain processes, Microsoft Dynamics brings together people, processes and technologies, increasing the productivity and effectiveness of your business, and helping you drive business success.
For more information about Microsoft Dynamics, go to: