Reference case: Interface implements JD Edwards Order to Cash
Oracle JD Edwards Order to Cash for carpet manufacturer Interface
International carpet manufacturer Interface was in urgent need of a modern ERP solution. The company asked Cadran to implement the Oracle JD Edwards Order to Cash system. Cadran upgraded the Warehouse Management System (WMS) and also realised a large number of subprojects at the same time. And it managed to do all of that without having to halt production for a single moment.
The carpet tile was invented by Dutchman Petrus Johannes Van Heugten and first came on the market in 1958. In the 1960s, Van Heugten’s company Heuga led the way in the field of carpet tiles and design floors. The brand has since become part of American company Interface, which has grown over the past 40 years into the world’s largest carpet manufacturer and is now one of the main players in the area of sustainability. The company’s branch in Scherpenzeel, which is where Heuga began, is the hub for its European production and delivery activities.
For the last 20 years, all of Interface’s international branches have been using a system that was developed in-house and maintained by the company’s own programmers. However, the system – which was originally programmed in Cobol – was becoming more and more difficult to use and had become outdated. The application was no longer compatible with the new production processes, and important add-ons no longer matched. Moreover, knowledge of the software was slowly disappearing from the company. ‘It’s as if you have an Opel Mantra and you want to build a navigation system into it. And you have to ask yourself if that’s a good idea,’ says Rob Heeres, Director European Planning & Distribution at Interface.
Order to Cash solution from Oracle JD Edwards
Interface decided it needed a new system in order to cut back the risks, link up with the business processes more effectively and ensure that it had a dependable platform for the future. With a new solution, Interface would also be able to harmonise its processes worldwide and optimise any flows that were not already process-driven. Then the company’s various departments – including Purchasing, Sales, Logistics and Finance – would be able to work together more effectively. Interface found Cadran to be the ideal partner for the implementation of the Pan-European Order to Cash system of Oracle JD Edwards. ‘Cadran’s people think along with us and really understand our business processes. They’re not just converting the ‘as is’ system into a new system, they’ve also explained to us in detail how we can configure our processes. And we really needed that advice,’ says Heeres.
WMS and ERP
To start with, Cadran upgraded the WMS, which is linked to an automated warehouse. The new version went live in January 2014. The ERP system was then connected to it. ‘That’s when we faced a new challenge,’ reveals Heeres. ‘We can’t afford to stop our business operations, so the transition to the new system had to be perfectly smooth. Over the weekend, we converted all the systems with Cadran, so the administrative standstill only lasted three days. To compare: in Asia and the United States, where they underwent a similar transition with other parties, they were off the air for six weeks. So we were delighted that we had such a great go-live.’
The seven months between the upgrade to the new WMS and going live with the O2C system were very intensive. Four Cadran consultants worked almost full-time at Interface to manage the transition. Twelve interfaces were built and a huge series of sub-projects was brought to successful conclusion at the same time. ‘Cadran’s strength is that they use the same consultants to manage the entire process. Their people are very experienced. On a project like this, you often get a few seniors and a few juniors. But given the enormous pressure and complexity, we couldn’t afford that to happen. With Cadran, we always had answers to our questions within the hour,’ says Heeres.
Training and instruction
Most of Interface’s employees have been working at the company for 15 to 30 years and were used to working with the old system. Every day, more than 500 employees use the new system. Cadran invests a lot of time and attention on helping and supervising people. For example, they organise key user training courses, supervise testing and train people. And they use an e-learning package with instructions, tests and certification (User Productivity Kit) to support users. Cadran played a strong “Senior Supplier” role during the project.
Heeres: ‘The project was a resounding success. Given the scale and the extent of the change and the geographical range, the project went really well.’
Employees of Customer Service, Planning and Logistics are now all working with the same system. All the available add-ons can be used and new technology can be deployed much faster and in a smarter way. Added to that, the risks in the old system have been resolved and no knowledge will be lost as people retire.
One of the first positive results is that the transparency of order management has increased enormously. In the carpet tile sector, orders are constantly changing. On average, every delivery date is reviewed twice, often at the last moment. In the old system, the old delivery date was overwritten so it was impossible to see the history. Now the entire history of a sales order is saved, so the customer service department can react in a much more targeted-oriented way. Interface can save costs by proactively calling customers to ask whether the delivery date is still correct.
And now they have much more control over the management of returned goods. Added to that, there are much fewer malfunctions and interruptions in the WMS. Significant improvements have also been made in the area of credit management: Interface can now find out much earlier in the process whether customers are actually able to pay their bills.
The transport costs are also much easier to understand. And thanks to that greater understanding, Interface has already started cutting back on those costs. ‘The analyses and the insights the system gives us are now starting to bear fruit. We’re currently involved in the improvement processes and we can make much more accurate forecasts.’ Now that the implementation of the Order to Cash system has been successfully completed, Interface is ready to take the next step. In 2016, Cadran will help Interface to implement its Manufacturing system.