Talk about pressure: nearly every vehicle in the world depends on Dana Incorporated for its propulsion and energy-management technologies. To serve its global customers, Dana must operate at peak efficiency. But it must also house a lot of data and support a plethora of electronic data interchange (EDI) standards and transaction types. And that’s where things can get complicated.
Dana has experienced tremendous inorganic and organic growth as it has expanded its products and services and grown its vehicle electrification business. All this growth and system complexity, coupled with historical IT systems, has led to an opportunity to go to the cloud as a key communications tool for its suppliers and customers worldwide.
Jeff Heyde, Dana’s Director of Global Systems, elaborates: “The numerous unique legacy translators had to be integrated differently to these end-state ERPs. We realized we needed to identify a secure, effective and cost-efficient solution .”
In 2019, Dana launched an aggressive consolidation strategy to modernize the company’s ERP environment and consolidate its complex EDI business network to a single EDI instance. The program also aligned with the company’s unwavering focus on cybersecurity and migration of its workloads to the cloud.
Huge volumes
Kilo-characters transmitted monthly 225,000 EDI transactions monthly 3.1 million
Humongus processing power
Processes 225,000 EDI transactions monthly
Matt Fahnestock, Dana’s Senior Vice President and Chief Information Officer (CIO), adds: “The cloud allows us to vary our costs based on the ebb and flow of business. We also believe that cloud providers have made significant investments in keeping their solutions safe and secure, which goes hand-in-hand with our first priority, cybersecurity.”
Technically, Dana needed a supply chain EDI provider that could connect each ERP application with its global suppliers and customers. But Heyde knew it would take more.
“It’s not only having a capable solution—it’s also having the people that can actually get it done and implement it in the timeframe we were looking for.”
Heyde found those people at IBM.
“We talked to pretty much everybody on the IBM program team and had a lot of confidence they had done this before. The people are a huge part of the selection process and why we chose IBM,” he says.
Dana is consolidating its EDI business network on IBM® Sterling™ Supply Chain Business Network software on IBM Cloud®. The technology processes and automates EDI transactions. By choosing the premium edition, Dana also gained the expertise of a dedicated project executive who serves as a technical subject matter expert for IBM Sterling technology.
“We saw IBM as not only having a great solution,” says Heyde, “but it was also an SaaS-based solution in the cloud, which really fit nicely with our overall IT strategy. Having an SaaS model allows for variable costs as our business fluctuates. Reliability and security are really important to us, too.”
IBM is performing the translation and transmission of all EDI and flat files, and supplier and customer data. To migrate EDI transaction data to and from its plants to the new IBM platform, Dana is using eight instances of IBM Sterling Connect:Direct software.
Currently, Dana transmits roughly 3.1 million kilo-characters per month on the IBM platform. It expects to transmit over 61% more kilo-characters per month within a year. It also processes over 225,000 transactions monthly. Soon it will process over 77% more per month. In 2021, Dana will complete its migration over to the Sterling platform, equating to 3 million transactions and 3,000 relationships.
With the premium edition of Sterling Supply Chain Business Network software, IBM manages the implementation and maintains the system. Premium support also enables IBM to proactively work with Dana’s suppliers, trading partners and customers on transactional issues and reconciliation.
“With system maintenance, servers have to be patched; there are upgrades that occur, there’s monitoring. All that goes away,” says Heyde. “Now we have a single partner and it’s in the cloud. IBM does the monitoring, they do the patching; it’s all part of the SaaS solution. That eliminates a significant amount of effort from an IT perspective, and it reduces risk. So, it fits nicely with our overall IT strategy.”
Dana’s IT strategy called for reducing the complexity of its infrastructure and moving its data centers to the cloud. It’s succeeding. Today, the company manages four ERP systems, not 50. And instead of relying on more than a dozen translators to communicate with its thousands of customers and suppliers, everyone is connected through a single, cloud-based solution—Sterling Supply Chain Business Network software. Heyde is quick to point out the technology’s reliability.
“We’ve deployed the solution to 38 plants globally and haven’t had any outages. That’s quite remarkable. We have a partner that’s invested to make sure that the solution is reliable and available to us at all times.”
Another improvement is the level of visibility into the traffic that flows between Dana and its partners. Plant managers use the solution’s real-time visibility and self-service tools to identify and resolve potential customer issues quickly, instead of submitting tickets for IT to fix the problem.
“That’s really important because it’s essentially eliminated IT as a bottleneck,” says Heyde. “So, if there’s an issue with an ASN [Advance Ship Notice] that the plant sent to a customer, the plant can see that instantaneously and resend those messages. There’s no need to call IT, which is perfect.”
COVID-19 struck while Dana was in the middle of its ERP consolidation. The pandemic affected nearly every aspect of the engagement. Suddenly, everyone was working remotely, which was a major concern.
“The project executive gave me several reassurances that this wasn’t something I should worry about,” recalls Heyde. “Now, looking back, he was absolutely spot on. The team has worked remarkably well remotely, and there are very, very good processes in place to communicate with everybody involved.”
“IBM has exceeded my expectations,” Heyde concludes. “I don’t view them as a vendor; I view IBM as a partner.”
Dana (link resides outside of ibm.com) is a leader in the design and manufacture of highly efficient propulsion and energy management solutions for all mobility markets across the globe. Based in Maumee, Ohio, in the US, the company reported sales of USD 7.1 billion in 2020 with 38,000 associates in 33 countries across six continents. Founded in 1904, Dana was named one of “America’s Most Responsible Companies 2021” by Newsweek for its emphasis on sustainability and social responsibility.
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