CTE

CTE wanted to simplify its existing IT environment to gain a unified view of its operations and accelerate data analysis, in order to reduce manual administrative work and free up staff to focus on value-added tasks.

The company engaged IBM Services to replace three disparate legacy systems with SAP S/4HANA applications, deployed in the cloud, forming a single pool of operational data.

Even the heavy machinery industry is not immune to the e-commerce revolution. Distribution businesses have been particularly affected, with customers increasingly tempted by internet-based sellers of spare parts and third-party service organizations.

One company was determined to halt the shift: CTE, which supplies Caterpillar Inc. construction equipment, spare parts and servicing to customers across Western North Carolina. To inspire loyalty among its construction clients, the company needed a game-changing competitive differentiator.

CTE realized that its historical sales and service data could contain valuable insight into equipment maintenance, costs and operations. If the company could analyze the information and offer it to customers in services such as cost comparisons, this value-added facility could bind them closely to CTE and help reinforce loyalty.

At the time, CTE ran three separate business systems, inherited from previous acquisitions and earlier corporate history. Precious data was effectively trapped in these system silos, which depended on legacy technologies not able to support modern app-based ways of working. To complete tasks such as financial reporting and operational planning, employees spent considerable time manually extracting data from each system, collating and validating the results before being able to present accurate reports. The time and cost of merging data from the legacy systems presented a significant barrier to CTE’s ambitious plans for customer-centered information.

Matt Nazzaro, VP and Chief Financial Officer, comments, “The environment for maintenance suppliers and dealerships like us is changing, and CTE is determined to stay ahead of the curve. As the internet threatens to disintermediate many distributor or ‘middleman’ companies, we must look for ways to add value to our services, to continue evolving in a challenging digital economy. First we needed a solid financial infrastructure on which to base this evolution.”

With the core financial applications now running on SAP S/4HANA, CTE gains a unified, integrated view of all its operational divisions. By moving to the cloud, CTE can reallocate staff formerly dedicated to server administration and maintenance to value-added tasks.

CTE has recovered the time spent on reconciling data generated by separate systems, and the consolidated ledgers on the single instance of SAP S/4HANA enable the company to generate standard reports for any business unit. CTE’s analysts can now rely on validated data from a single source to review budgets and create forecasts, and perform all-important customer analysis.

Matt Nazzaro explains, “Previously we might have struggled to identify that a customer whose details were held in the lift truck division was also a Caterpillar equipment customer. With a single ledger and a unified chart of accounts, we can easily see who buys what, and whether there may be additional services we could offer that customer. Similarly, we can use financial data to examine the patterns of spend by each customer, helping us and them understand their expenses, and enabling us to offer them better services in future.”

In the past, many apparently simple tasks were relatively complex, requiring manual consolidation and merging of data across divisions. Reports that relied on multiple data sources would require continuous updates. By introducing SAP S/4HANA, not only has Carolina CAT enabled consistent, rapid reporting from a single data source, but the background report maintenance workload has also been removed. Additionally, users much prefer the tile-based SAP Fiori interface, giving them easy access to modern applications.

With assistance from IBM Services, CTE now plans to extend the solution with data security, materials management and profitability analysis applications, starting the journey towards the predictive analytics that will drive customer loyalty.

“The SAP S/4HANA solution delivered by IBM Services, positions CTE to defend its strong market position,” continues Matt Nazzaro. “IBM Services has helped CTE to deploy an SAP S/4HANA solution that can easily meet rising workload and support additional functionality, making us a highly responsive, data-enabled company. With the new solutions, CTE can take advantage of a host of exciting new capabilities, including IBM Watson®, and exploit huge reserves of data at our disposal."

Matt Nazzaro concludes, “Ultimately, as we extend SAP S/4HANA to link financial to operational and product data, CTE will be able to draw deeper insights and form new conclusions, helping our customers gain the maximum value from their investments. IBM Services is a central part of CTE’s journey to becoming a data-driven, digitally enabled business.”

Founded in 1926, CTE made a commitment to support the growth of North Carolina by supplying and supporting Caterpillar equipment to the construction, road-building, utility and mining industries. More than 90 years later, CTE has served the equipment needs of the Carolinas. In addition to offering a full line of construction, forestry and paving products, the company also offers a complete line of material handling equipment, engineered systems, truck engines and power generation systems as well as superior product support.