Habit Reforming

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Brady Corporation CEO Katherine Hudson knew that before she overhauled the "high performance" label-making company she had to look at the people who ran the operation first.

Habit Reforming

In fact, Brady's mantra became "vanilla is a good flavor," says Kaczanowski.

And that made more than a few line managers unhappy. They were being told to scrap decades of work habits in favor of a common, shared system of operating.

"Common and shared is good as long as it's mine that gets shared" was the mood, recalls Linda Dean, global process manager for new product development.

But habits had to die. In the old system, users asked any question they wanted about orders and the stage of manufacturing and distribution they were in. The custom queries often jammed the system. Under new processes, standardized responses are generated on queries about orders.

Manufacturing Engineer Mike Sweeney found the new SAP software an overall improvement, but not as precise as the old software. According to Sweeney, SAP is set up to calculate all costs based on a single unit. But since Brady's products—labels—can be very low cost, that can cause a problem. If the unit of cost turns out to be less than 1 cent, the reported cost becomes zero. To fix the problem, Brady now multiplies its cost by 1000 units, which forces all costs above a penny.

Forecasting the number of labels, signs and other products that must be manufactured also was difficult, because Brady's executives and managers were not used to the rigor of planning for demand.

"I don't know that we put enough study into reporting issues," Sweeney says. "There was a lot of figuring about what went in [but not what came out]." Only now is the company getting used to planning its production through the SAP system.

The order-process management team ended up with too much new information. The SAP platform deluged customer representatives with hitherto unfamiliar data as purchase order histories, raw materials schedules and accounting figures. Brady responded by training employees to know where to find information and creating shortcuts to find important answers, such as the current status of an order.

A key goal was to ensure that 60% of pricing and product questions could be answered on a customer's first call. Previously, it could take up to a week to quote a price. That's because sales reps relied mainly on hardcopy charts and tables. Often, potential orders had to be walked around to different offices to complete quotes.

"It left room for a lot of error," says Pam Schirm, process owner for contact and payment. "We didn't have an entire view of the customer and there were no smooth handoffs."

So Brady redesigned its pricing to distributors. A uniform system of price breaks was created. Minimum orders were eliminated. A customer can now buy one single Brady label, but it will cost $19.82. A thousand will cost 79 cents each. And the SAP Sales and Distribution module locks the new policies throughout the production process.

By preloading SAP's Variant Configurator with product and pricing information, sales reps could develop prices on the fly. Reps input information on type of tag, material desired, size, color and layout, and the Configurator automatically gives a quote.

Brady also fired up SAP's Available to Promise (ATP) platform, which allows customer reps to see where a product is in the manufacturing or warehousing process and how long it will take to ship.

The improvements are working, Belmonte says. Brady now provides more than 60% of its quotes on the first call, and is shooting for 90%.

But getting there hasn't been easy. Sales reps had two new software systems to learn and the curve was steep.

"There was a 'this isn't my job' mentality," says Belmonte. "It has taken a year to 18 months to get to the point where they are now comfortable."

Jenny Pody, customer-service team leader, agrees and says the learning curve was steep: "It was really hard to get used to." SAP required phone number verification, e-mail addresses and other data—things the reps had not had to think about before.

Reps struggled with screens that were crammed with new quoting, ordering and tracking information, much of it in the foreign language of credits and debits. The entire customer representative staff required a crash course in accounting basics, says Pody—particularly when missed shipments and over-shipments had to be handled.

But now Pody and other reps can see individual orders on their screens and trace them through to an invoice. "I like being able to see everything," she says now.

This article was originally published on 2002-05-15
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