Detecting the jewel in the crown?

When TransBus International was formed in January last year as a joint venture between specialist vehicle manufacturer Mayflower (which owns Walter Alexander and Dennis) and the Henley Group (owner of bus body builder Plaxton), it found that its combined parts operation – now TBI Parts – had inadvertently struck e-business gold. Bus and coach maker Alexander had been developing a novel web publishing system for components identification, and not only was it to become the very foundation for all of Alexander’s, Dennis’ and Plaxton’s disparate after-market parts sales operations, but their driver for very serious growth. When this system is fully deployed, TBI Parts’ customers and their own sales representatives will be able to search for and identify parts, viewing engineering drawings and virtual parts manuals for literally everything the group has ever manufactured – all in real-time from their own web browsers. They’ll also get client-specific pricing and availability, and they’ll be able to place and track orders remotely from their desktops via TBI’s back-end ERP integration. It is an excellent model. The story starts back in summer of 1999, when Anthony Pursey, then Alexander’s CEO, was heading up its first generation e-commerce development. “The objective was just to get body parts manuals on line,” explains Pursey. “Body makers manufacture in batches of up to 20 if you’re lucky, and every vehicle can be unique. So locating the right parts as vehicles age – and they’re in the field for a long time – is a bit of a detective game.” Mechanics in bus operators’ depots were having problems identifying parts. “Buses in service get moved around; they don’t send the manuals with them, and repair shops rarely see each individual bus,” says Pursey. So errors were being made, wrong parts shipped, time wasted and buses kept off the road. Unhappy customers were looking for alternative local suppliers and Alexander’s otherwise lucrative parts business was falling to a fraction of its potential. Says Pursey: “We wanted to make it easy for customers and third party repair shops to find their parts by coming at it from their unique identifiers, like the vehicle registration or VIN number – and linking these to the original bill of materials (BoM) and engineering drawings using web technologies. It was a pragmatic solution.” Winner takes all There was also a company positioning and future-proofing aspect. “We wanted to position ourselves as leading edge,” says Pursey. “So we invested ahead of customer demands… Also, if we developed a first class e-commerce front end we would have a de facto standard – rather than waiting for customers, which would mean a plethora of platforms and technologies to follow.” Development went well, and the project was soon set for expansion across the rest of Mayflower. But then came the merger, and reorganisation into integrated business units across the brands. For the resulting TBI Parts, a key challenge became finding a way to enable sales staff from the different businesses to work with the now very large, disparate spread of current and legacy component ranges – spanning Alexander, Plaxton, Duple, Leyland and Dennis, across operations in Scotland, Yorkshire, Lancashire, Northern Ireland, Hungary, Hong Kong and Singapore. Says Pursey: “We had chassis sales people selling body parts they hadn’t got a clue about, yet we were trying to present a seamless organisation. That’s how we backed into this much bigger e-commerce project.” And what a project. Today, it’s grown to combine two core functions: the on-line parts catalogue/manuals covering Dennis chassis and bodies from Alexander, Mayflower, Plaxton and its legacy products; and real time access to on-line sales order processing with TBI’s now company-wide Impact Encore ERP system, implemented by Information Engineering (IEGL). Users, both internal and external (customers and TBI’s world-wide agents), enter the system via a secure virtual private network (VPN) and get everything from product identification to instant availability. They can create ‘baskets’ of parts, store them as standard service packs for future call-off, order them remotely, and then track the status of despatch notes. So effective is it that for parts its now replacing the standard Impact ERP sales order processing front end. Global advantages “In the future this will click through to include the warehouses, freight forwarders and so on,” says Pursey. “All parts pricing is customer specific and secure using XML file exchange, so we’ve got the prospect of low cost EDI controlling everything from despatch to goods received (GRN) and invoicing, all electronically.” And he points out that, beyond the obvious benefits, the system will also provide an unattended global 24/7 business with, for example, the Vancouver, Canada agent able to search and order on-line in its own office time – which only overlaps the UK’s by one hour. Says Pursey: “At the moment we’re using it internally at our sites in Woking, Bristol, West Midlands, Skelmersdale, Durham and Falkirk. [But] Stagecoach Manchester has a copy… I think that we’ll be taking customer orders directly over the web by Q1 next year.” From an implementation and technology standpoint Pursey says that, beyond the usual essentials of management commitment, training and the rest, key to success was putting the project’s prime function and thus people at the centre of the project. Internally, that meant involving those closest to the core manufacturing planning system. Externally, since IEGL had provided Alexander’s, and subsequently also Mayflower’s, Dennis’ and Plaxton’s ERP, having ousted a range of legacy systems, “their technical people were very familiar with the way our engineering drawings and BoMs were created. So they were in the best position to do the job.” IEGL worked with web technologies firm GI Computer Services, which it subsequently acquired, to deliver the engineering drawings front end. Martin Diserens, TBI Parts’ process control manager, says that meant first converting from all the original drawings in whatever format (Radan for CAD and Word, PDF and so forth for catalogues) to AutoCAD, then providing appropriate mark-ups and saving as HTML pages with a URL for the system to pull up. GI built a suite of software tools to automate most of the conversion, and the result was effectively a database of web-accessible drawings covering all components (current and legacy). From that point the firm went on to develop COM objects sitting between AutoCAD and the Impact Encore ERP system and providing for intelligent communication, with the business logic that Impact uses, between the two systems and out to the e-commerce server. “Business rules and logic were all encapsulated, so the objects make calls to the ERP system for parts information from the original BoMs in real time,” says Diserens. Externally, the system runs via Citrix thin clients, he says, meaning minimised network traffic and nothing needed at the remote end beyond the browser. The publishing application runs from TBI’s e-commerce server, and all interchange is delivered via the VPN. “[Clients] get screen paints and their browsers simply send back keyboard and mouse inputs,” says Diserens. “Citrix just sends the bitmap, a bit like the old terminal servers.” On screen it allows several levels of search, select and order: standard parts searches against part numbers, providing hyperlinks to descriptions, availability and the rest; advanced searches using clients’ own part numbers, fragments of part descriptions and so forth; and the top level detective stuff, based on VIN, fleet and body numbers, and bringing up the engineering drawings, with active balloon fields linking into the original ERP BoM data for part numbers. Simple but so effective Simple, maybe; practical and effective, certainly. What did it cost? Says Pursey, “We acquired one additional e-commerce server to host the development, but the communications infrastructure was already in place. We had to upgrade [it] because of the increasing volume of transactions, so that wasn’t driven particularly by the e-commerce development – we had to be able to do real time business within adequate response times.” So how much? “You’ve got to think of around half a million [pounds] in terms of the actual software, the development, management time, the hardware and the networking,” says Pursey. Not cheap, but that’s the price of doing it properly and setting up all the infrastructure of swithces, routers and the rest for the VPN to run on, the Citrix systems across the whole TBI group, and so on – and there’s the VPN rental of some £6,000 per month. And his projected ROI (return on investment)? “The investment was based on a number of factors: one, strategic positioning, two, a simple break even analysis of incremental revenue increase from the after-market. Our objective was to box our own weight in the after-market. Over a period of time we reckoned we could double the body parts revenue. I’d say it was 40% strategic, 40% incremental revenue increase projection and 20% efficiency and cost savings.” For Pursey, it’s already absolutely been worth it. “Parts is usually the department that history forgot,” he continues. “You know, the future for manufacturers is all about the after-market: it’s quality and service. It won’t be long before people buy our buses because we do such a good job in the after-market. New product development is the sexy bit, and of course it’s important, but it’s not always the most profitable – or where the differentiator will be over the next five years. “With our investment we’re not only at the leading edge of e-commerce – my ambition is to be the jewel in TBI’s crown.” And his wish is already well on the way to reality. Before the merger Dennis had some 25% of the chassis business, and 20% of its parts after-market; Alexander had 25% of the body business but just 5—10% parts. “As Alexander and Dennis combined we were an £18—20 million parts business one year ago. My five year target was to take that to £50 million. This year we’ve done £32 million.” And he adds: “I’ll look for growth from other specialist low volume vehicle OEMs, like dust cart and cement mixer manufacturers who can’t afford the cost. We’re already supporting Dennis fire products. We could manage all this for them, become a specialist Unipart, providing their customers with parts access to their BOMs and engineering drawings.” Pursey concludes: “Smaller businesses, looking forward, are going to have to confront similar investments or look to outsource to a sympathetic partner like us. There’s no future for manufacturers beating their heads against a market that clearly wants ever more service without investing to deliver it.”