Efficiencies transformed

21 Jan 2008

Using e-business technology, distribution firm Origo was able to transform its management systems to a point where the company now has 98pc stock accuracy.

Philip Galligan (pictured), commercial director of distribution firm Origo, is a believer in the power of technology. Before the company introduced an enterprise resource planning (ERP) system, the company would have to tally its books every month before a fresh month could begin.

“It used to frustrate the hell out of me spending weekends closing off month end – we had real old-style computer systems, but thankfully we’ve moved on from then.”

Origo, part of the Sisk Group, saw its origins in the 1950s when John G Sisk, founder of the construction company, bought some Bosch equipment for his business on a trip to Germany. Within a year, the company had acquired the rights to distribute the brand in Ireland.

Today Origo is a €70m-a-year business distributing top brands from Bosch to Stihl and Viking. The company manages the distribution of over 60,000 product items to industry and semi-state bodies.

In recent years, the company implemented the Microsoft Dynamics NAV, formerly Navision, and has never looked back.

“We view technology as an enabler. Microsoft Dynamics NAV runs across the entire business covering finance, sales and IT. We handle up to 350 orders a day. Each order could be for just one item or there could be hundreds of items on a single order.”

Galligan says the key achievement of the system for him was the fact that he and his colleagues could use the technology to determine how they wanted to run the business – rather than having the technology decide that for them.

“The implementation evolved incredibly fast. It started off as a basic financial package. Now we have no paper in the organisation. We have electronic links to all our carriers with shipment details for different parts of the country. The system issues electronic payment on delivery documents that are matched with invoices and orders on the system. In the past, customers would be waiting weeks for these.

“All our sales reps are on remote access, with every single one of them equipped with a laptop in the field and they have access to every customer’s details as well as stock availability.”

Galligan says the next major step in the process is to establish Origo Online. “There are so many aspects to this; customers can order online and track the delivery of the goods. Because of barcoding we would know exactly where the product is in the warehouse or if it’s en route.”

He describes Origo’s business as complex insofar as the company doesn’t just distribute goods for brands like Bosch in Ireland but also manages brand advertising and promotion with dealers. “A lot of distribution companies just ship goods on tight margins. We focus on high-quality brands.”

The Microsoft Dynamics NAV system was implemented for Origo by Sysco with mobile access to the system provided by Coleman Computers.

“We see ourselves as a leading-edge technology company within the distribution business,” says Galligan. “We think of technology as an enabler. Instead of taking on more and more people, we try to keep the numbers fairly steady. In the past three years, we’ve grown turnover from €40m to €70m and have kept the same number of people.”

Conor Wickham of Microsoft Dynamics NAV says implementing ERP is about improving and driving productivity and enabling all individuals in an organisation to be empowered to make informed decisions.

“Whether you’re a financial director or in accounts receivable, good access to information about customers and the status of the supply chain is key. This puts companies like Origo in a better position to achieve improved business performance, as well as customer satisfaction and service.”

Charlie Donnelly of Sysco explains the turnaround for Origo. “Before the warehouse system went in, Origo had an average three- to four-day delivery cycle. Now that’s down to same-day delivery. Another important change was reps in the field taking orders. Now orders can come in without any manual intervention, which has removed the possibility of errors.

“The company has also achieved a 98pc level of stock accuracy and 99pc of orders that are received today leave today,” Donnolly concludes.

By John Kennedy