Improve Your Implementation Experience with Wholesale Distributors Scott Pugmire Sr. Vertical Industry Manager Background on Scott Pugmire Eleven years in the software industry with experience in: VAR.
Download ReportTranscript Improve Your Implementation Experience with Wholesale Distributors Scott Pugmire Sr. Vertical Industry Manager Background on Scott Pugmire Eleven years in the software industry with experience in: VAR.
Slide 1
Improve Your Implementation
Experience with
Wholesale Distributors
Scott Pugmire
Sr. Vertical Industry Manager
Slide 2
Background on Scott Pugmire
Eleven years in the software industry with
experience in:
VAR experience
– ERP implementation (mostly wholesale distributors)
– Project Management, implementation, training, light
development
Software vendor experience
– Implementation methodology providing training and tools
to VARs
– Product Management in the areas of Distribution &
Manufacturing
– Industry Marketing in the areas of Distribution &
Manufacturing vertical industries
Slide 3
Agenda
• Overview of Concepts
• Transition considerations from sales to
implementation
• Get to know your customer… the earlier, the better
• Discover the most important things about your
customer… What they don’t tell you
• Turn knowledge into a plan, but carefully!
• Communicate, communicate, communicate
• Change Management
• Don’t forget to write
Slide 4
Overview of Concepts
Slide 5
Overview of Concepts
• How well is sales preparing the implementation
team?
• How well does the customer know themselves?
• How well do you know your customer in the
beginning?
• What are the obvious and subliminal issues?
• How can you and your customer best manage
their process improvements?
• How can you continue to build a relationship with
your customer after they go live?
Most Important Concept: They Own This Project
Slide 6
Transition Considerations from
Sales to Implementation
Slide 7
Transition Considerations from Sales to
Implementation
• What has sales learned about the
customer during the sales cycle?
– Company Structure and Issues
– Hot Buttons for Them
• Inventory Control?
• WMS?
• ADC?
• BI?
• CRM?
• Order Management?
• Vendor Management?
Slide 8
Transition Considerations from Sales to
Implementation
• What internal procedures do you have to
transition knowledge?
– Face-to-Face Conference
Meeting
– SharePoint or other means of
storing prospect/customer notes
and information
Slide 9
Get to Know Your Customer…
The Earlier, The Better
Slide 10
Organizational Dynamics
• Who is project sponsor in the customer’s organization?
• Who are the stakeholders?
– Warehouse/Operations Manager
– Director of Finance/Controller
– VP of Sales
• How well does the customer know themselves?
• What are their other Interest outside of warehouse
improvement and how do warehouse needs weigh-in against
other needs of the company?
• Are they any unusual/unique circumstances surrounding the
dynamics of the company?
Slide 11
Organizational Dynamics
• What are the dynamics
among the leadership of the
company?
– Who will be the internal
competitors?
– Any family dynamics?
• What is the status of the
company within their own
industry?
– Are they an up-n-comer?
– Are they the industry leader?
Slide 12
Process Improvement Focus
• How do the needs of the warehouse compare to the needs of other
parts of the organization?
– Complexity, Priority, Software Capable
• Are there interdependent or pre-requisite improvements that must be
made?
• Can the customer give you baseline metrics for their processes with
their legacy system and current processes?
– If not, you should encourage them to consider postponing the start of
the implementation until they are able to compile this information.
• What types of information are important for them to measure
success after implementing the new software and processes?
–Receipt Time
–Order Picking Time
–Customer Fill Rates
–Rate of Returned Goods due to
packing and shipping errors
–Employee Turnover Rate
Slide 13
Process Analysis
• Set aside one or two day
minimum to drill down into your
customer’s current operations
• Start with a brief meeting with the
warehouse manager and others
to get a high-level understanding
of the warehouse
• Take a warehouse tour
• Perform process flow analysis on
their key processes
– “A Day in the Life” of an Inventory Item Process Flow Diagram
– “A Day in the Life” of the Returned Goods Process Flow Diagram
– Application Environment Diagram
Slide 14
Process Analysis Examples
Slide 15
Discover the Most Important
Things About Your Customer…
What They Don’t Tell You
Slide 16
Let’s Start With What They Do Tell You
• Have an initial meeting with the warehouse manager to get
an overview of their operations in their own words.
• Do they have multiple warehouses? Do they use a hub-nspoke method of inventory distribution between warehouses?
• How organized do they think their warehouse is? Where do
they see this project taking them?
• What are all of the software programs in use to assist in
tracking Inventory? Is Excel the main tool?
• How much faith do they have in their people? Do they have
high-turnover? How much shrinkage do they have? Do they
drug test?
• Do they know what items have the highest inventory turns?
• Do they have a significant rate of stockouts?
Slide 17
Then Compare To What They Don’t Tell You
• After hearing what the customer says their
operations are like, have them give you a
warehouse tour.
– Look at their warehouse design – are zones,
racks, and bins in use? If so are they labeled?
Are there handheld devices in use?
– How is the receiving dock setup and what is its
proximity to the shipping dock?
– Look for dusty pallets, boxes, or unorganized
areas of the warehouse and ask about them.
– Observe the staff at work and ask about
various people that you see performing their
jobs.
• Overall, are the things you observe from the
tour in agreement with the way the customer
describes it?
Slide 18
Potential Personnel Problems
• If it is uncovered that inventory shrinkage is a major problem,
follow up with some possible reasons:
– Do they drug test?
– What kind of unsupervised access do employees or others have
to the warehouse?
– Do salespeople raid the warehouse for sample stock, or are
there established and followed procedures?
• If productivity or customer satisfaction is an issue, follow up
with the following questions:
– Are the best employees working in receiving?
– Are there particular employees with unusual longevity?
– Are there any morale issues?
Slide 19
Turn Knowledge Into a Plan…
But Carefully!
Slide 20
Turn Knowledge Into a Plan… But Carefully!
• As you begin to take what you learn about your client and
turn it into a plan of action, be cognizant of the following:
– Who benefits the most from an improvement?
– Whose job changes the most from an improvement?
– Are you really listening to your customer about the change they
want, or filling in the blanks based on past experiences and how
you solved them?
– Is the individual change a process change, a software change,
or both?
Slide 21
Inventory & Warehouse Control
• Only the people receiving, moving, picking and packing
material should be allowed in the area where merchandise is
stocked.
• Record all material that leaves a warehouse
– If Sales uses sample stock, create a customer account for each
salesperson.
• Each location should have approved stock lists
• Warehouse Organization
–
–
–
–
Establish Zones/Bins
Analyze the racking system
Clean up junk areas of the warehouse
Have a fire sale
• Reconcile Inventory in a more timely manner by establishing
Cycle counting procedures. This will help identify when
shrinkage is occurring and help your customer solve this
problem much faster
Slide 22
Analyze The Inventory
• The fastest moving products, regardless of their product
category, should be closest to the shipping, staging, and
receiving.
• If you decide to use this method of bin location assignment,
base your decision of where to stock a particular product on
the number of “hits” it has experienced in the past 12
months.
• Research shows that the more often a product is received or
shipped, the less accurate its computer stock balance
Source: Effective Inventory Management by Jon Schreibfeder
Slide 23
Bin Categorization
• Fixed Bins: used for products that you always want to store
in the same location. Even when you are out of stock of an
item, its fixed bin remains empty, reserved for the
replenishment shipment of the product.
• Random Bins: In a warehouse that utilizes random bins,
replenishment shipments are stored in any empty bin. As
soon as the stock maintained in a specific location is
exhausted (i.e. an on-hand quantity equal to zero), the
random bin that held the item is made available for the stock
receipt of any product stocked in that warehouse.
• Holding Bins: Holding bins are used to store any inventory
that is not currently available for sale. For example, you may
use holding bins for material awaiting inspection,
repackaging, or return to a supplier.
Source: Effective Inventory Management by Jon Schreibfeder
Slide 24
Receiving Dock Management
• If a pick ticket is printed, fill the order. Most successful
distributors have an order “cut off” time. Any order received
before the cut-off time is acknowledged and a pick ticket is
printed. Warehouse employees are expected to fill all printed
orders before they leave for the day.
• Stock Receipts should be put away within 24 hours of
receipt. Many distributors put stock away when there are no
customer orders to fill. Sure, the packing slips pulled out of
the shipments are sent to the office to be entered in the
computer. But the actual material often stacks up in the
receiving area, waiting for a “lull” in activity.
• Process customer returns the day the material comes
back. Many salespeople have an aversion to processing
credit memos. After all, credits usually have a negative effect
on commission checks. If you look at salespeople’s desks
(or search through their drawers), you’ll often find a stack of
credits that will be processed “as soon as they find the time”.
Slide 25
Communicate Communicate
Communicate
Slide 26
Communicate, Communicate,
Communicate
• Keeping consistent timely communications ongoing with your
customer is the key to managing their expectations
• Remember that this is what you do everyday. Don’t assume
that they have understanding of the project status
• Keep the Project Sponsor informed from time to time
Slide 27
Change Management
Slide 28
Change Management
• Getting the employees at all levels involved from the
beginning makes them feel as though they are contributing to
the decisions that will ultimately affect them at a later date.
• They will be more likely to buy into the project
• Keep in mind that the new software and updated processes
may mean better data tracking for upper management, but a
lot more work for the staff.
• When it’s time to go live, they suddenly seem to have an
escalated interest in the system
Slide 29
Don’t Forget to Write
Slide 30
This is a Long-Term Partnership
• Look for opportunities to continually help
them grow their business
• There are many ways to find revenue from
additional consulting or software solutions
• This will be an ongoing lucrative
partnership for years to come
Slide 31
Thank You
Improve Your Implementation
Experience with
Wholesale Distributors
Scott Pugmire
Sr. Vertical Industry Manager
Slide 2
Background on Scott Pugmire
Eleven years in the software industry with
experience in:
VAR experience
– ERP implementation (mostly wholesale distributors)
– Project Management, implementation, training, light
development
Software vendor experience
– Implementation methodology providing training and tools
to VARs
– Product Management in the areas of Distribution &
Manufacturing
– Industry Marketing in the areas of Distribution &
Manufacturing vertical industries
Slide 3
Agenda
• Overview of Concepts
• Transition considerations from sales to
implementation
• Get to know your customer… the earlier, the better
• Discover the most important things about your
customer… What they don’t tell you
• Turn knowledge into a plan, but carefully!
• Communicate, communicate, communicate
• Change Management
• Don’t forget to write
Slide 4
Overview of Concepts
Slide 5
Overview of Concepts
• How well is sales preparing the implementation
team?
• How well does the customer know themselves?
• How well do you know your customer in the
beginning?
• What are the obvious and subliminal issues?
• How can you and your customer best manage
their process improvements?
• How can you continue to build a relationship with
your customer after they go live?
Most Important Concept: They Own This Project
Slide 6
Transition Considerations from
Sales to Implementation
Slide 7
Transition Considerations from Sales to
Implementation
• What has sales learned about the
customer during the sales cycle?
– Company Structure and Issues
– Hot Buttons for Them
• Inventory Control?
• WMS?
• ADC?
• BI?
• CRM?
• Order Management?
• Vendor Management?
Slide 8
Transition Considerations from Sales to
Implementation
• What internal procedures do you have to
transition knowledge?
– Face-to-Face Conference
Meeting
– SharePoint or other means of
storing prospect/customer notes
and information
Slide 9
Get to Know Your Customer…
The Earlier, The Better
Slide 10
Organizational Dynamics
• Who is project sponsor in the customer’s organization?
• Who are the stakeholders?
– Warehouse/Operations Manager
– Director of Finance/Controller
– VP of Sales
• How well does the customer know themselves?
• What are their other Interest outside of warehouse
improvement and how do warehouse needs weigh-in against
other needs of the company?
• Are they any unusual/unique circumstances surrounding the
dynamics of the company?
Slide 11
Organizational Dynamics
• What are the dynamics
among the leadership of the
company?
– Who will be the internal
competitors?
– Any family dynamics?
• What is the status of the
company within their own
industry?
– Are they an up-n-comer?
– Are they the industry leader?
Slide 12
Process Improvement Focus
• How do the needs of the warehouse compare to the needs of other
parts of the organization?
– Complexity, Priority, Software Capable
• Are there interdependent or pre-requisite improvements that must be
made?
• Can the customer give you baseline metrics for their processes with
their legacy system and current processes?
– If not, you should encourage them to consider postponing the start of
the implementation until they are able to compile this information.
• What types of information are important for them to measure
success after implementing the new software and processes?
–Receipt Time
–Order Picking Time
–Customer Fill Rates
–Rate of Returned Goods due to
packing and shipping errors
–Employee Turnover Rate
Slide 13
Process Analysis
• Set aside one or two day
minimum to drill down into your
customer’s current operations
• Start with a brief meeting with the
warehouse manager and others
to get a high-level understanding
of the warehouse
• Take a warehouse tour
• Perform process flow analysis on
their key processes
– “A Day in the Life” of an Inventory Item Process Flow Diagram
– “A Day in the Life” of the Returned Goods Process Flow Diagram
– Application Environment Diagram
Slide 14
Process Analysis Examples
Slide 15
Discover the Most Important
Things About Your Customer…
What They Don’t Tell You
Slide 16
Let’s Start With What They Do Tell You
• Have an initial meeting with the warehouse manager to get
an overview of their operations in their own words.
• Do they have multiple warehouses? Do they use a hub-nspoke method of inventory distribution between warehouses?
• How organized do they think their warehouse is? Where do
they see this project taking them?
• What are all of the software programs in use to assist in
tracking Inventory? Is Excel the main tool?
• How much faith do they have in their people? Do they have
high-turnover? How much shrinkage do they have? Do they
drug test?
• Do they know what items have the highest inventory turns?
• Do they have a significant rate of stockouts?
Slide 17
Then Compare To What They Don’t Tell You
• After hearing what the customer says their
operations are like, have them give you a
warehouse tour.
– Look at their warehouse design – are zones,
racks, and bins in use? If so are they labeled?
Are there handheld devices in use?
– How is the receiving dock setup and what is its
proximity to the shipping dock?
– Look for dusty pallets, boxes, or unorganized
areas of the warehouse and ask about them.
– Observe the staff at work and ask about
various people that you see performing their
jobs.
• Overall, are the things you observe from the
tour in agreement with the way the customer
describes it?
Slide 18
Potential Personnel Problems
• If it is uncovered that inventory shrinkage is a major problem,
follow up with some possible reasons:
– Do they drug test?
– What kind of unsupervised access do employees or others have
to the warehouse?
– Do salespeople raid the warehouse for sample stock, or are
there established and followed procedures?
• If productivity or customer satisfaction is an issue, follow up
with the following questions:
– Are the best employees working in receiving?
– Are there particular employees with unusual longevity?
– Are there any morale issues?
Slide 19
Turn Knowledge Into a Plan…
But Carefully!
Slide 20
Turn Knowledge Into a Plan… But Carefully!
• As you begin to take what you learn about your client and
turn it into a plan of action, be cognizant of the following:
– Who benefits the most from an improvement?
– Whose job changes the most from an improvement?
– Are you really listening to your customer about the change they
want, or filling in the blanks based on past experiences and how
you solved them?
– Is the individual change a process change, a software change,
or both?
Slide 21
Inventory & Warehouse Control
• Only the people receiving, moving, picking and packing
material should be allowed in the area where merchandise is
stocked.
• Record all material that leaves a warehouse
– If Sales uses sample stock, create a customer account for each
salesperson.
• Each location should have approved stock lists
• Warehouse Organization
–
–
–
–
Establish Zones/Bins
Analyze the racking system
Clean up junk areas of the warehouse
Have a fire sale
• Reconcile Inventory in a more timely manner by establishing
Cycle counting procedures. This will help identify when
shrinkage is occurring and help your customer solve this
problem much faster
Slide 22
Analyze The Inventory
• The fastest moving products, regardless of their product
category, should be closest to the shipping, staging, and
receiving.
• If you decide to use this method of bin location assignment,
base your decision of where to stock a particular product on
the number of “hits” it has experienced in the past 12
months.
• Research shows that the more often a product is received or
shipped, the less accurate its computer stock balance
Source: Effective Inventory Management by Jon Schreibfeder
Slide 23
Bin Categorization
• Fixed Bins: used for products that you always want to store
in the same location. Even when you are out of stock of an
item, its fixed bin remains empty, reserved for the
replenishment shipment of the product.
• Random Bins: In a warehouse that utilizes random bins,
replenishment shipments are stored in any empty bin. As
soon as the stock maintained in a specific location is
exhausted (i.e. an on-hand quantity equal to zero), the
random bin that held the item is made available for the stock
receipt of any product stocked in that warehouse.
• Holding Bins: Holding bins are used to store any inventory
that is not currently available for sale. For example, you may
use holding bins for material awaiting inspection,
repackaging, or return to a supplier.
Source: Effective Inventory Management by Jon Schreibfeder
Slide 24
Receiving Dock Management
• If a pick ticket is printed, fill the order. Most successful
distributors have an order “cut off” time. Any order received
before the cut-off time is acknowledged and a pick ticket is
printed. Warehouse employees are expected to fill all printed
orders before they leave for the day.
• Stock Receipts should be put away within 24 hours of
receipt. Many distributors put stock away when there are no
customer orders to fill. Sure, the packing slips pulled out of
the shipments are sent to the office to be entered in the
computer. But the actual material often stacks up in the
receiving area, waiting for a “lull” in activity.
• Process customer returns the day the material comes
back. Many salespeople have an aversion to processing
credit memos. After all, credits usually have a negative effect
on commission checks. If you look at salespeople’s desks
(or search through their drawers), you’ll often find a stack of
credits that will be processed “as soon as they find the time”.
Slide 25
Communicate Communicate
Communicate
Slide 26
Communicate, Communicate,
Communicate
• Keeping consistent timely communications ongoing with your
customer is the key to managing their expectations
• Remember that this is what you do everyday. Don’t assume
that they have understanding of the project status
• Keep the Project Sponsor informed from time to time
Slide 27
Change Management
Slide 28
Change Management
• Getting the employees at all levels involved from the
beginning makes them feel as though they are contributing to
the decisions that will ultimately affect them at a later date.
• They will be more likely to buy into the project
• Keep in mind that the new software and updated processes
may mean better data tracking for upper management, but a
lot more work for the staff.
• When it’s time to go live, they suddenly seem to have an
escalated interest in the system
Slide 29
Don’t Forget to Write
Slide 30
This is a Long-Term Partnership
• Look for opportunities to continually help
them grow their business
• There are many ways to find revenue from
additional consulting or software solutions
• This will be an ongoing lucrative
partnership for years to come
Slide 31
Thank You