Volume 7, Number 30 -- August 7, 2007

VAI Automates Service Calls, Tightens Inventory Control

Published: August 7, 2007

by Robert Gast

The IT department at Hercules Corporation, among other things, bears the weight of inventory control. It's critical to the success of this service-oriented business that depends on mobile technicians and repair parts. While most of the goods are warehoused at the company's headquarters in Hicksville, New York, there are tens of thousands of dollars worth of parts riding around in service vehicles and in staging areas near job sites. Keeping repair parts in the hands of the technicians means keeping tight control over inventory.

Hercules operates more than 5,000 squeaky clean laundry machines in dozens of condominium, co-op, dorm, and apartment buildings throughout New York, New Jersey, Connecticut, and elsewhere in the Northeast. They also design comfortable, bright laundry rooms that tenants can relax in. Trump Towers is one notable landmark where you'll find laundry facilities operated by Hercules.

Laundry contractors generally enjoy steady cash flow, at least until a washer or dryer breaks down. To minimize machine downtime, Hercules has a tidy fleet of commercial repair vehicles that are used by skilled repair technicians who blanket the area that the company serves.

As an IBM midrange customer for 25 years, Hercules had core business applications that were largely built to their specs, but because these green-screen programs were outdated, users had access to what was at best, only basic functionality. "We needed to be able to keep track of a huge inventory of equipment and parts, and in many ways, this system fell short of our requirements," says Hicks.

Hercules also needed to address the fact that it sometimes took several days to return a machine to service after receiving a service request, according to Michael Gallagher, project director at VAI (Vormittag Associates, Inc). "When parts needed for a service call were not on the truck, or in a staging area, or in the main warehouse, a machine could remain out of service for days and result in lost revenue," says Gallagher.

Today, Hercules' IBM System i 520 hosts a comprehensive ERP system called S2K Enterprise Edition from VAI. This system, now in version 3.75, includes accounts receivable, accounts payable, general ledger, customer orders, customer relationship management, sales analysis, inventory management, purchasing, material requirements planning, retail point of sale, and service billing. Says Hicks, "We looked at a few other packages but felt that Vormittag best fit our company's needs with their base package. They have a good reputation and after meeting with them we realized that they knew what they were talking about."

Tailored to Fit Hercules

Hercules is running a largely unaltered version of S2K for the exception of the service billing module. Because Hercules has equipment and parts scattered across a multi-state area, VAI extensively modified VAI's Truck Replenishment application and other aspects of service billing to accommodate their unique requirements.

According to VAI's Gallagher, "These new programs are based on our client's need to get parts from the warehouse to their technicians out in the field. To handle service calls, technicians pull parts from inventory on their vehicle or from a staging area during the course of the day. At night, when they return to the warehouse, these parts need to be replenished. Inventory levels throughout the operation are maintained at optimal levels."

VAI's custom Service Billing component allows customer service representatives and managers to enter and track every service request, review technician workloads and assign work, track service codes, track service history of equipment by serial number and record the labor and parts used to fix equipment. Integrated billing options allow the firm to backorder parts, automatically generate preventive maintenance work orders and create detailed invoices. Says Hicks, "We are now able to track any problems on any piece of equipment based on a serial number or a problem code associated with that machine."

Furthermore, integration with the firm's accounting, purchasing, customer service, and repair functions, offers complete operational visibility to all members of the organization. This level of integration was unavailable with the home-grown applications Hercules used prior to implementing VAI's S2K.

In addition to accepting currency for payment, Hercules' machines also accept Smart Cards. Smart Cards work like a debit card or prepaid credit card. The card is inserted into a card reader on the washer or dryer and the proper amount is automatically deducted. The starting balance and then the remaining balance on the card is then displayed on the card reader. Hercules has over a quarter of a million Smart Card users. VAI made modifications to accounting programs that track route revenues to accommodate unusual refund requests for cash and smart card transactions.

Better serviced machines result in fewer complaints and better revenues for Hercules. "We're minimizing equipment downtime, replacing equipment with high failure rates and better utilizing employee time at headquarters and in the field. The impact is already being felt in greater efficiencies and uninterrupted revenue streams. Conservatively speaking, I believe we saved $25,000 in the two months that followed our go live date," says Hicks.

For now, 20 Hercules employees access this system from their GUI desktops. Within six months Hercules will have VAI implement radio frequency bar code scanners for warehousemen and repair technicians. This capability will give them real-time control over core business functions. "We've only scratched the surface of what S2K Enterprise Edition can do for our business," says Hicks.

VAI, headquartered in Ronkonkoma, New York, is an IBM premier business partner and a leading provider of enterprise solutions for the distribution, manufacturing, retail and service industries. This office, along with regional facilities in Miami, Orlando, Chicago, Newport Beach and Oreville, California, serve roughly 750 clients.

Robert Gast is a regular contributor to IT Jungle. He can be reached at bobgast@evantgroup.com.

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