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Atto
Abrasives Ltd
5 . The Project
5.1 Business requirements and solution choice
åtto first developed a website in 1996. In 1998
they looked at getting into the consumables market to
complement their specialist range. First they looked
at achieving this by utilising traditional marketing
communications, such as product brochures to be sent
out to target customers. Their concern, however, was
that this would only serve to cheapen the market and
place the emphasis on price. They then turned to a consideration
of the web as a potential channel to market.
From the start the project was well structured. Recognising
they needed independent advice they employed Pyramid,
a firm of consultants, to help them frame the problem
and design an appropriate solution. They looked at around
six consulting firms before choosing Pyramid. It was
felt that they understood the issue best. They also
liked Pyramid because they were not tied to a specific
product/solution. They felt that they were more likely
to offer the best possible solution.
Pyramid spent a week on site, mapping and documenting
the key processes, including raw materials and ordering.
They then put a proposal to åtto based on an EFS
package. EFS are a Swedish company, represented by Pyramid
in Ireland. The package is an accounting and Enterprise
Resource Planning offering.
There was concern on the part of åtto that this
package might not be appropriate for their business.
In the end they chose to work with a Dublin-based company
called GEAC Enterprise Solutions and implement their
Streamline package. Implementation started in November
2000.
GEAC are a worldwide supplier of enterprise management
software. Their Streamline solution handles a firm’s
finance, distribution and eCommerce needs. It is a turnkey
solution specifically designed for small to medium-sized
enterprises which provides a complete range of software
to manage the flow of product through the entire supplychain
from purchased raw materials to the sales of finished
goods, including accounting of all transactions. The
feeling in the åtto team was that not only did
Streamline deliver all the required capability but it
also had the capacity to grow with the business. The
åtto team also felt that the GEAC personal understood
their business and market and were impressed with the
individuals involved.
A three-man team worked on sit at åtto to install
the hardware, software and deliver the training. The
åtto management team feel they received very good
value from the implementation.
Initially
the system has been designed to support 10 users on
a new IT platform comprising Windows NT and an SQL Server
database. The new integrated e-Commerce solution, which
will utilise a separate IBM Netfinity server, will allow
the company to extend its distribution of roducts even
wider into the lucrative European markets.
Michael Prendergast, managing director of åtto Abrasives, said at
the time of the deal “we liked Streamline as it provides us with
an excellent web-based customer self-service solution. We now have everything
from order processing and progressing, to account review and invoice enquiry
features at the user's fingertips. There are clear business benefits through
its fast and easy to use interface which can provide our customers with
24x7 customer service at a fraction of the cost of a manned facility."
5.2
The åtto team
There are a dedicated team of three people within åtto
looking after the eCommerce function day-to-day. Lee
Rogers manages the hardware and software infrastructure.
Lee was involved in the installation and commissioning
of the system. He will also be involved in the next
phase of the development in 2003.
Noleen O’Neill and Paul Cullen are responsible
for the management of the order processing and the selling.
There is a telesales operation, supported by field salesman
based out of Northern Ireland.
5.3 Training
The team have built substantial knowledge and skill
of the systems and process over the last couple of years
of operation. All personnel engaged in the eBusiness
initiative were given appropriate training on all aspects
of the system. The training was not restricted to computer
related topics but also encompassed training on:
- grading
of abrasive products
- customer
support
- logistics,
5.4
Budget
The budget breakdown for the overall project was as
follows:
| Item |
2000 |
2001 |
Total (£000) |
| Current
Expenditure |
|
|
|
| *Feasability/R&D |
8,000 |
|
8 |
| **Employment
Costs/Consultants |
8,000 |
2,000 |
10 |
| Staff
Training & Marketing Training |
6,000 |
8,000 |
14 |
| Marketing |
6,000 |
20,000 |
26 |
| Capital
Expenditure |
|
|
|
| Software
(including integration) |
26,000 |
12,000 |
38 |
| Hardware
(Server, PCs, etc.) |
15,000
|
10,000 |
25 |
| Other
(Lease line, routers, sonic-wall, etc.) |
7,000 |
6,000 |
13 |
| Total
Current and Capital |
- |
- |
134
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* This includes the investigation of what approaches
and solutions were adopted by other businesses in comparable
situations and their appropriateness to the company’s
own customers and suppliers (executive time, travel,
consultancy)
** The cost of employing over the first two years of
external specialist staff to undertake the eBusiness
project
5.5 Project Benefits
The benefits can be differentiated between those that
have been achieved to date and those that will be achieved
over the longer term. Additionally, benefits can be
broken down according to whether they are åtto’s
or customers’.
- To-date
– åtto
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Improved structure to stock control and pricing
- Enables
better targeting of marketing
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Gathering lots of information on competitive
situations
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To-date – customers
- Easier
access to åtto product range
-
Standard pricing information online (price negotiation
still occurs off-line on the basis of the value
of the relationship to åtto)
- Long-term
– åtto
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Building a better database of customer information,
requirements and issues
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Gives an improved structure to the organisation
- Store
technical, product and customer information
in an accessible way
- Long-term
– customers
- Check
stock, interrogate accounts and get technical
data online
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Cross grade between åtto and competitor’s
products
The key benefit
to åtto is that this constitutes the early development
of a full Customer Relationship Management (CRM) system.
By gathering this kind of customer information and mapping
it to their existing product lines and using it to develop
new product lines åtto will be able to substantially
deepen their existing customer relationships and develop
a broader range of customer relationships.
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CRM
(Customer Relationship Management)
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CRM is defined as an integrated sales, marketing and service strategy
that depends on coordinated actions. The goals of CRM are as follows:
- Use
existing relationships to grow revenue
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Use integrated information for excellent service
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Introduce more repeatable sales processes and procedures
- Create
new value and instil loyalty
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Implement a more proactive solution strategy
CRM
requires developing a set of integrated applications that address
all aspects of front office needs, such as the need to automate
customer service, field service, sales and marketing.
To succeed companies are looking to application software vendors
to support integration across the range of business functions.
By investing in CRM applications, companies are hoping to retain
customers better and increase lifetime revenue. Even a five percent
increase in customer retention can increase profits by as much
as 85 per cent!
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There
are three phases of CRM:
1. Acquiring new customers
2. Enhancing the profitability of existing customers
3. Retaining profitable customers for life
Companies need to design and build a CRM architecture around customer
life cycles and customer interactions. This architecture must customer-centred
and not split across company functions.
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