ERP System Solves Schukras Growth Bid

Case Study: The maker of auto seat parts sought faster systems processes, reduced manual tasks.

Four years ago, the MIS team at Schukra of North America, a subsidiary of Leggett & Platt Automotive Group, was charged with the task of streamlining the companys business processes and reducing the manual workload.

Leggetts Automotive Group was expanding rapidly at the time, and the MIS team was asked to provide an ERP (enterprise resource planning) solution to facilities that did not have the resources to support implementation.

At the time, Schukra, which makes lumbar seat-support structures for automobile makers, was using SSA Global Technologies Inc.s BPCS (Business Planning and Control System) Version 6.0.4 ERP system running on Hewlett-Packard Co.s Unix platform.

Laura Ryall, MIS director at Leggett & Platt, wanted to upgrade to BPCS Version 8.2. She said the improved functionality and features—such as Web-based access and three-way match and automated e-invoicing—met the companys needs. But before upgrading to the newer ERP system, Schukra faced a hardware decision.

/zimages/3/28571.gifClick here to read about how IBM is making a SMB push with its iSeries partner program.

"What I was facing was that my Unix box was old and at capacity, yet the business was escalating," Ryall said. "We wanted users to use ERP more, which meant more data."

Ryalls dilemma was deciding whether to remain on Unix or move to IBMs iSeries, which is used by the majority of BPCS 8.2 users. She did a cost analysis and compared remaining with Unix with moving to the iSeries and decided it was better to go with the iSeries. One big factor was staffing costs.

"On Unix, I needed Oracle [Corp.] developers, and theyre not as easy to find as RPG (Report Program Generator) programmers. With the network people, it was the same thing, finding a Unix person who is really good is putting a lot of eggs in that basket; its not as easy to find a talented Unix person as it is an iSeries person," said Ryall.

With the help of SSA Global and IBM, Schukra in three months upgraded from SSA Globals BPCS Version 6.0.4 to BPCS Version 8.2 and migrated from HPs Unix platform to IBMs iSeries and an IBM DB2 database.

SSA Global consultants helped Schukra with planning, testing and training.

"We focused in on the processes and people necessary for ... this implementation, and we utilized our colleagues at IBM for the integration and architecture of the solution," said Martin Ambrose, vice president of channels and business development at SSA Global, based in Chicago.

"There was an awful lot of detailed planning, which we asked SSA to review, and we worked with IBM heavily on data conversion. Everyone had a very key role to ensure cutover," said Ryall.

Schukras team conducted the cutover during a three-day weekend. But their work was not done yet.

Schukra executives wanted to tackle another problem. Schukra had been using another ERP solution from Peartree Software Inc. When it moved to BPCS, the EDI (electronic data interchange) inbound and outbound remained with Peartree, which meant there was a lot of manual data transfer and entry between systems, said Ryall.

"Our EDI was not feeding into BPCS, and when your EDI is not feeding into the ERP, it doesnt take advantage of what ERP is supposed to do," said Ryall.

After six months, Schukras staff had removed the Peartree software and moved the EDI to the newer ERP system.

"Again, it was a very challenging process, and with EDI I was more nervous, but we did that between April 6 and Sept. 6 [2003], and it was 100 percent smooth," said Ryall. "In one year, from September 2003 to September 2004, we accomplished two very aggressive projects."

So far, Ryall said the move has paid off for Schukra. The implementation enabled the company to streamline the management of several core business processes, she said.

Schukra reduced its MRP (material resource planning) run-time from 3 hours to 20 minutes, cost roll from more than 6 hours to 2 hours, backups from 5 hours to less than 2 hours, check run from 1 hour to 5 minutes and sales forecast reports from 3 to 8 hours to 10 minutes, said Ryall.

Also, the Web-based ERP system enables the company to keep staffing levels and overhead facilities costs down.

"With the automotive industry, what you have is an environment with decreasing lead time and increasing pressure on companies like Schukra. Their need for access to information from supply to demand information is very critical," said Ambrose.

"A 90 percent reduction in planning activities—that is huge. That allows Schukra to run planning cycles more frequently, and those provide significant competitive advantage. Even with basic operations, the ability to go through order to cash in a third less time, thats also very important," said Ambrose.

Ryall credits her success to extensive staff planning, training, communication and motivation.

/zimages/3/28571.gifCheck out eWEEK.coms for the latest news, reviews and analysis about productivity and business solutions.