Manufacturer Augments IBM i ERP with Cognos Express
January 22, 2013 Alex Woodie
When Mestek, a metal manufacturing conglomerate based in Massachusetts, needed to streamline its financial reporting process, it faced two choices: either replace its highly customized IBM i ERP system with a new ERP system with integrated analytics, or augment its investment in IBM i with an add-on reporting tool. Faced with the risks and costs of the first choice, the company chose to augment with IBM‘s Cognos Express.
Mestek and its numerous subsidiaries manufacture a variety of products in the areas of heating, ventilation, and air-conditioning (HVAC), metal-forming, and architectural products. The privately owned company employs 1,800 people in 25 locations in the US, China, and Europe, and brings in about $300 million annually, according to a case study published on IBM’s website recently.
Mestek is mostly happy with its IBM i-based ERP system. “It’s a reliable system, and over the years it has been heavily customized to the needs of our specific business,” Stephen Shea, executive vice president and CFO of Mestek, says in the case study. “The downside is that it lacks some of the easy accessible reporting and analytical capabilities of modern ERP systems.”
Mestek’s financial reporting process was complicated and burdensome. To produce monthly and quarterly reports, the company would have to extract information coming in from 25 locations, and push it into linked spreadsheets. The work maintaining those reports grew as Mestek grew and its corporate structure became more sophisticated due to acquisitions.
The lack of an integrated reporting solution forced Mestek to rethink its approach. “We had two choices,” Shea said in the case study. “We could either replace our whole ERP/MRP infrastructure with a more modern platform–a project that would have represented a significant risk to our business and cost hundreds of thousands of dollars–or we could extend the life of our existing systems by integrating them with a new business analytics toolset. The second option was much more attractive to us.”
Mestek looked at several products, including Cognos Express, a Windows-based business intelligence solution that IBM launched in 2009 to serve the BI needs of mid-market companies. Cognos Express is based on the old TM1 product that Cognos obtained with its acquisition of Applix back a number of years ago, and features an in-memory online analytical processing (OLAP) database, ad-hoc reporting tools, a variety of pre-built reports and dashboards, and report distribution tools.
Cognos Express stood out to Mestek. “The more we looked at it, the more it seemed like the right option,” Shea says. “In a single, cost-effective package, it offered both the sophisticated analysis tools that our business unit managers and controllership teams need, and the ability to present data in an intuitive, graphical way for business users who aren’t necessarily trained accountants.”
Things are looking good for Mestek halfway into its Cognos Express implementation, which was done by IBM’s “business analytics software services” group. Human errors have declined since abandoning the work-intensive spreadsheet processes, and data quality has improved. The next step will be putting key metrics in centralized dashboards that are easy to read.
Shea credits Cognos Express with giving the company’s IBM i infrastructure a new lease on line. “If phase two of the project is successful, which we certainly anticipate, and we’re able to deliver the dashboards that we’ve planned, we will extend the value of our existing systems very significantly.”
To download the full Mestek case study from IBM, see www-01.ibm.com/software/success/cssdb.nsf/CS/STRD-8ZZMR8?OpenDocument&Site=default&cty=en_us.