QlikView increases distributor’s flexibility and insight into operations
ESP International is a manufacturer and distributor of seals, rubber products and plastics, as well as cast and forged metals. The Iowa-based company, founded in 1969, has a strong international presence, with multiple locations in the United States, as well as facilities in China, Taiwan and India. The company manages a vast inventory of raw materials, subassemblies and finished goods, with standard and customized configurations driving the need for specialized data and analytics.
With a unique business model, ESP required more flexibility in a business intelligence tool to look deeper into more aspects of the organization. The company desired a new platform to evaluate sales, inventory transactions and purchases from many different perspectives. It had established key performance indicators, but the company could only view results from a fixed context.
ESP uses an analytics approach, known as the “Monthalyzer,” whereby sales and progress against budgetary goals are portrayed based on how many business days are remaining in the month. The data is derived from their Prophet 21® ERP system and patterned after current reporting, producing valued metrics, but it required more granularity in its information moving forward.
ESP chose RSM to implement a QlikView business discovery platform after the team demonstrated the benefits of the system using current company data in a quickly built demonstration application. Using a copy of ESP’s database, RSM loaded sales information and showed the ability to manage a large volume of data and the flexibility to view information from many different perspectives.
With the business intelligence (BI) system, ESP can switch the context of its data and make it more readily available to employees that perform different types of analysis. For example, employees evaluated simple sales data in the past; now, they can view sales relative to specific vendors and determine whether margins are appreciably different versus other suppliers.
The ability to look deeper into the data, and segmenting it to evaluate specific divisions or even salespeople adds a significant amount of value, and helps ESP plan for future operations. “In the past, we had to go to report servers, or SharePoint® in another view to collect information, and it was difficult to drill down into,” said Melissa Jones, ESP International vice president of global finance and shared services. “Following the QlikView implementation, we can pull up what we did yesterday, last year or in years past and compare information at a high level, drill down into it and chart it. It has been pretty nimble, allowing us to efficiently data mine a lot of the information that we need.”
Insight into inventory
The BI system has allowed ESP to get a handle on slow-moving inventory, one of their greatest concerns. The company warehouses clients’ parts inventory, making products available based on purchase forecasts from them. However, when purchases differ from these projections, ESP is left with excess inventory. The company needed greater visibility to understand when products stopped moving.
Prior to the BI implementation, ESP reviewed inventory on an annual basis; now that practice is performed each day. This more timely information allows the company to approach clients shortly after they have stopped purchasing a product, rather than up to a year afterward. Employees are now capable of looking at specific groups of products to determine if a product has stopped moving to determine a course of action, rather than inventory occupying shelf space.
“Like many distributors, we are left with inventory for our customers when a model of their equipment goes away or their needs suddenly change,” commented Jones. “RSM created an item drop off report to keep track of our products; the sooner we can get back to the customer, the more likely they will work with us to take the inventory. If it gets past 6-12 months, it is a battle. Having that increased visibility allows us to get to the customer much quicker and recoup some of those dollars.”
Design and implementation
In the design phase, the RSM team worked with ESP to understand what information was available, and what employees needed to know to make better decisions. Data needs and wants were prioritized, considering sales information, inventory transactions, quality control and opportunities versus orders. Meetings took place with employees responsible for these areas to determine how the new BI platform could be built out to make a difference for them, and provide stronger information and deeper insight into their operations.
When implementing the final BI platform, RSM focused on building a controlled number of very meaningful analytics for the company. Rather than immediately releasing an overwhelming amount of new reporting upfront, much of which would not be used, focus remained on a smaller number of key measures. After using the tool and interacting with the initial set of new data, ESP was able to determine additional information it could benefit from, and address further analytics in subsequent development phases.
“In addition to the high-level dashboards that show sales, margin and where we are in relation to our budget, each department has developed key metrics to monitor on a daily, monthly and quarterly basis,” said Jones. “From there, we have developed more dashboards for areas such as inventory reports, quality tracking and on-time delivery. The sales group is also incorporating a scorecard into QlikView that provides key metrics by customer, salesperson, industry and product family. We continue to build QlikView out with reports, dashboards and applications to help individual areas conduct their day to day activities.”
RSM provided training on the new platform, from both a user and internal IT standpoint. Users were shown how the application was built for them, and the IT staff was educated in how the application could be modified. The company has been self-sufficient with modifications to the environment, as their IT staff has the capabilities to maintain the BI environment moving forward.
“We had a vision to have a fully integrated business system where employees could go to one spot and get the information they needed or conduct necessary activities without bouncing between different areas,” said Jones. “The QlikView implementation was a major part of that, providing dashboards and information at our fingertips and the ability to drill down into that data.”
As a result of the BI implementation, ESP International now has greater visibility into its operations, and can develop more robust and accurate solutions. The new platform has provided greater insight into slow-moving inventory, and allows the company to find solutions for excess product in a timely manner. The increased and more granular reporting has allowed the company to make better business decisions and become more efficient.
Other benefits of RSM’s service to ESP included:
- More complete and segmented information to evaluate the performance of divisions and sales personnel
- Ability to evaluate inventory data on a daily versus annual basis, easing the process of addressing clients’ contractual obligations to purchase products
- Scalability in its business intelligence platform, with the ability to adapt the solution with internal IT personnel
They said it
“Working with RSM has been a really good experience. The team is always very responsive, and they were not afraid to show us how to continue to do things on our own. Some companies are territorial, but they have supported our vision, provided valuable feedback and worked well with our team.”
Melissa Jones, Vice President of Global Finance and Shared Services, ESP International