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  - Aug. 7, 2012 -  

Supply Chain News: Major Distributor Fleet Pride Hits ROI Target within 45 Days from Supply Chain Planning in the Cloud

 

Rapid Deployment Pays Off Big While Not Impacting Current Operations During Project at All
 
     
     
  by SCDigest Editorial Staff  
     
 

How can a a dynamic and growing company company undertake a major supply chain transformation, supported by new planning software, without having any impact on the business as the changes were taking place? And deliver as promised rapid time to value, with payback on the new technology in just two months.

The answer for FleetPride, a major and fast growing distributor of parts for the trucking industry, was to head to "the cloud," for its new planning tools.

SCDigest Says:
Fogolini takes almost as much pride in how FleetPride was able to achieve all this without impacting company operations in the least.

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That according to Steve Fogolini, Director of Supply Chain at FleetPride, who recounted the successful project during a recent Videocast on our Supply Chain Television Channel. To see the full broadcast, go here: Supply Chain Planning in the Cloud Delivers Rapid Time to Value, Payback in Just Two Months for FleetPride.

FleetPride is the largest independent distributor of aftermarket parts for the trucking industry in the US. It has grown rapidly in recent years through a series of acquisitions, as well as organic growth. Like many companies that have made such moves, that left FleetPride with a large, decentralized supply chain network that was difficult to manage, had poor visibility, and was more reactive than proactive in terms of supply chain planning and execution.

"We wanted to create a single supply chain focus," Fogolini said.

Fogolini says that over the course of 30 years, FleetPride had built the company on a homegrown technology platform that just was not able to meet the supply chain needs of this now much larger and more complex company.

And this was not an easy planning environment. FleetPride has more than 1 million SKUs, and manages a network with five regional distributions centers and 254 branch locations. It has more than 1600 unique vendors.

But unlike many companies, when the decision was made within FleetPride to deploy new supply chain technology, slow and exceedingly cautious was not the operating mode.

"We were looking for a rapid solution that could scale quickly and not interrupt the current business," Fogolini said. That, of course, can be a tall order, and he added that the company had seen several of its suppliers run into operational problems as they deployed new software. FleetPride was determined that this was not going to happen to its supply chain.

That commitment started by very tightly defining the project's goals. Fogolini said those were four:

(1) Enable proactive prediction and anticipation of growing demand
(2) Improve cash flows
(3) Achieve profitable demand and supply balancing
(4) Realize rapid time to value with low risk

The last of these might be thought of as especially challenging, as usually accelerated deployments entail a lot of risk.

But to a great extent, cloud-based supply chain software can change this dynamic. Deployment inherently becomes much faster, and since so much of the technology effort can be dramatically reduced, it allows the project team to focus much more intensely just on processes and results.

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FleetPride ultimately chose new planning tools from JDA Software that would run in the cloud.

FleetPride was looking for a number of new capabilities from the software. Specifically, it needed significantly enhanced demand planning tools, better replenishment logic for DCs and branches, and better inventory planning tools, such as being able to set inventory policies specific to individual SKUs or SKU families.

FleetPride was also looking to automate many of its more manually-intensive supply chain processes.

Consistent with the project goals, the implementation timeline was very aggressive, with a plan from start to completion that would last just 20 weeks. In fact, the first phase of the project, deployment of a new demand planning solution, kicked off in December of 2011, and went live in March of this year. Other phases were complete well within the project schedule.

The project began with a two-week "fit assessment," the output of which in part was a very detailed identification of what processes and capabilities were in scope and which were not.

Fogolini says the project was outstanding, noting that "within four months we went from concept to a fully functioning system."

The benefits of the cloud starting showing up rapidly too, Fogolini says. JDA was able to provide within the first two weeks of the project a cloud-based software test bed it calls "ILab," which is a fully functioning environment that allowed FleetPride to learn and configure the software right away.

"It's really kind of a "sand box" and that's how we used it," Fogolini said of the ILab environment. "It was a tremendous tool for us to be successful in such a short period of time."

Outstanding Results

Not only did FleetPride hit its aggressive project timeline, it was equally successful in meeting financial and other operational objectives as well.

"We had a savings target of several million dollars, and we were able to achieve that within the first 45 days," Fogolini said.

That was largely from immediate reduction in inventory. "With a lot smarter algorithms, the system was able to go out and predict the things we needed, balance our inventory, and stop the flow of things we didn't need," Fogolini said.

But Fogolini takes almost as much pride in how FleetPride was able to achieve all this without impacting company operations in the least.

He says that this project took place while the company was in the middle of another acquisition in addition to strong organic growth, and that service levels were not affected at all. Customer service then improved shortly thereafter from the status quo.

"We were able to implement a company-wide planning system and not only not lose any momentum during the project but actually gain momentum while hitting our ROI targets," Fogolini said.

Additionally, automation of processes and moving to a more "management by exception" environment "has been a big winner for the company" Fogolini added.

"So far, we've hit all of our objectives, and it has been a phenomenal engagement," Fogolini said.

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