Cavalier Homes' Software Overhaul: Caught Short

By Larry Barrett  |  Posted 2002-08-09 Email Print this article Print
 
 
 
 
 
 
 

Cavalier Homes vastly increased its efficiency with factory software. Too bad it had to leave the project half-finished, like a builder whose funds have run out.

Jay Wilson began to realize costs were out of control at Cavalier Homes when the company discovered two of its service technicians scheduled to service jobs in the same region were staying in the same hotel in Little Rock on the same night and didn't know it.

PDF DownloadThe fact that one of the service technicians might have handled both jobs, making better use of company resources, was the immediate problem. But the inefficiency was in keeping with other problems at Cavalier—problems that were easy to overlook when the economy was strong but that became inescapable when it wasn't.

Cavalier is just now learning how inefficient its entire operation was during those boom times and, more importantly, how much it's going to need new technology if it's to survive the implosion of the manufactured housing industry.

"We saw how much trouble we and the rest of the industry were in and realized we had to start making some changes," says Wilson, chief information officer of the Addison, Ala. company. "We'd grown so rapidly, both internally and through acquisition, that we needed to organize ourselves in a way that made sense."

The first order of business for Wilson's team was to purchase and deploy an enterprise resource planning system that could manage all of its sales, accounting, manufacturing and service divisions in the same terms. A part in Belmont, Miss., needed to have the same stock-keeping unit (SKU) as a part in Addison, Ala.

After an exhaustive search, Cavalier opted for SAP's R/3 software as the project's backbone. It's a project aimed at yielding improvements in sales, inventory reductions and manufacturing efficiencies—but that Cavalier, to its own disappointment, had to suspend last year when unexpectedly large losses in its core business forced it to identify costs it could cut.

To date, the SAP project is little more than half done, and Cavalier has invested $5 million in it. But that is enough to put the project's benefits—as well as its challenges—into focus.

Wilson says the most difficult aspect of the installation was marrying Cavalier's internal inventory-tracking and identification systems to the detailed requirements within the SAP system. For example, a screw or carpet or piece of metal used in the frame of a house might have had three or four different SKUs assigned to it at three or four different Cavalier plants. That had to end.

Defining a single standard for each part and service throughout the entire operation, and then making sure that same part number showed up at each step—purchasing, ordering, installation and later servicing—proved to be the biggest headache throughout the SAP implementation.

"Once we were able to get everyone on the same page, it was amazing how smoothly the software ran and the kind of information we could get from it," Wilson says. "But to get to that point took years off my life."



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Senior Writer
larry_barrett@ziffdavisenterprise.com
Larry, of San Carlos, Calif., was a senior writer and editor at CNet, writing analysis, breaking news and opinion stories. He was technology reporter at the San Jose Business Journal from 1996-1997. He graduated with a B.A. from San Jose State University where he was also executive editor of the daily student newspaper.
 
 
 
 
 
 

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