Success Stories

Nobody needed to sell H. J. Kirby Corp. on the benefits of technology for its operations. It was an early adopter of personal computers, automating its order entry, inventory management, purchasing and billing in the 1980s, and a Web pioneer among distributors, with a site dating to 1999. But as the Westlake, OH-based manufacturer and master distributor of instrumentation and control products entered the new millennium, it realized that if it was to continue to grow, it needed to bring its technology out of the old one.

"We had a home-grown compiled dBASE program that we used for order entry, inventory and purchasing," said company President Terry Brady. "Then we used a piece of paper to transfer data over to our invoicing program, which we had written using Microsoft Basic.

"Back in the 1980s, when we started using these, we were pretty much in line with the technology of the time, but here we were in the 21st century and we were still relying on Sneakernet for data communications," he continued. "If a customer wanted to know what he had ordered the last time he contacted us, we would have to go to the closed files and physically retrieve the paperwork."

Wanted: A Way To Manage Complexity

The disconnect between different programs for order and inventory management and for bookkeeping was bad enough, but there was another technological millstone hanging from Kirby's neck: None of its software could handle its complex pricing system.

"We have a matrix pricing system on three levels: One for resellers, one for stocking distributors, and one for retail end users," Brady said. "Our pricing varies depending on the type of customer, the types of products they wanted, and the order size. We especially have to get the end user prices right to avoid competing with our distributor customers."

This pricing structure loomed larger than any other consideration when Kirby went shopping for a single solution that could handle all their needs. Moreover, Brady said, "I believe that software should allow you to automate your business - you shouldn't have to alter your business to fit the software."

"I believe that software should allow you to automate your business - you shouldn't have to alter your business to fit the software. Prophet 21's pricing pages did what we wanted right out of the box."

Software That Fits Your Business, Not The Other Way Around

That proved to be a major stumbling block with most of the solutions Kirby evaluated: "We really couldn't get the other packages we looked at to fit our system. Their salespeople would say, 'Yeah, we can do that, but there's this third-party add-on that you'd need to get' or 'We'd have to write a custom routine for you.' Activant Prophet 21's pricing pages did what we wanted right out of the box."

So choosing Prophet 21 proved a no-brainer for Kirby, and both the company and its customers have reaped the benefits. "We price orders based on the dollar amount of the order: less than $100, $100 to $499, and $500 and up," Brady explained. "The way we used to do things, if a customer called with a multi-line order, we would first have to determine the under-$100 price of the order and see where that got us. If it was then over $100, we'd have to re-price it again. We would have to go offline and tell the customer we would call him back with the quote.

"Now we just enter all the line items, hit Recalculate, and the customer has his price right there. If all the items are in stock, the system just prints the pick ticket, and the order is assembled and ready to be shipped. It's incredibly easier."

Prophet 21 has also made it easier for Kirby to manage its consignment customers: It allowed Kirby to create virtual warehouse locations for the customer site. Now, when these customers need to be restocked, Kirby transfers the inventory within Prophet 21 and then generates shipping and invoice data when the customer actually consumes the product. It has also eliminated the paper-based system that the company used to handle kitting and work orders in its light manufacturing shop.

The Keys To Survival: Better Productivity, Better Customer Service

All this has improved productivity significantly for Kirby. "We're a small company - we have only six employees. If we were still doing business the way we used to, we would need another person in our office," Brady said. It's also freed up enough time for the staff we already have to proactively talk to customers where we couldn't before - if a customer hasn't ordered from us in a while, we can now call and ask them what's up."

And it has allowed Kirby to stay one step ahead of a challenging business environment. "We're an industrial distributor that supports manufacturing, and manufacturing is not exactly healthy in the Midwest," Brady said. "So we've had to change how we do business a bit. Some of our customers are cutting their vendor bases and coming to us with more of their business. So we now have to maintain many more vendors than we had in the past, and the software allows us to do this."

While Prophet 21 represented a significant expense for Kirby, Brady said it was worth every penny. "While it's a relatively large chunk of change for a company our size, if it keeps me from having to increase my payroll, it doesn't take me long to get a payback on the investment. And while it hasn't increased our sales, it has kept our sales from declining the way some of our rivals' have. In this market, I'd consider that a victory."

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