Even after a month of implementation, the benefits of the operational BI system from TARGIT were visible and the stock level began to decline and still continues to decline. ABS could decrease it with over 20 percent and stock rotation jumped from 2 to 3 times a year on average. This meant an increase in sales of 33 percent with an even lower stock level.

Now, the goal of replacing their skewed stock levels with correct ones has taken place, and it took the second half of 2009 for all “too high” stock levels to disappear. “At ABS, we are convinced that the operational BI system actually helps the purchase department to do their jobs more efficiently and that the company can execute their business better than before, even better than the competition,” says Marketing Manager Mats Hofstra, primary driver of the initial BI project.

Use of both traditional and operational BI
ABS’ traditional BI system meant to support decision making based on revenue and margin performance, inventory levels and sales delivery performance. “We had too little inventory of high volume goods and too much of older slow moving goods,” explains Mats Hofstra. Since it was their ERP system that was generating purchase suggestions, external information was needed to support the purchase department in validating the orders proposed by the ERP.

The operational BI system is integrated in several business processes like sales and procurement. For instance, every mayor purchase order is validated and controlled with exception reports, and vendor performance is measured and discussed with the suppliers on a regular basis. TARGIT’s Intelligent Agents are used to warn whether a purchase is more eminent or not.

“We have had discussions at our order entry desk with the customer about our service level, since we could not answer the client about how long he has been ordering a certain product before we actually delivered it,” says Mats Hofstra. A change was made to the ERP system and business process to track these orders as lost sales and the order desk got access to an informational report which allowed them to analyze how many times a product was reordered until it was back in stock at All Brake Systems.

TARGIT provides the information to the business users in analyses and reports that show their service level, how many products are delivered on time for specific customers or groups. In order to calculate the service level, a business rule in the OLAP cube was defined to count every order for the same product twice, which was acceptable for their clients. The system would recalculate the service level based on this business rule. ABS’ order entry desk is now capable of answering the client’s questions and can present accurate service level information to the client.

The many benefits and wide acceptance of the TARGIT solution have made ABS look for new opportunities in different business processes to implement operational BI from TARGIT.