The more countries your company operates in, the more trading partner requirements you need to meet. Electronic document interchange (EDI) is vital to accommodate these requirements at scale — but managing EDI in-house can drive up costs. To solve the challenge, The Master Lock Company migrated EDI processes to IBM® Sterling Supply Chain Business Network.
For The Master Lock Company, fast-paced global growth means onboarding and transacting with more partners each year. How could the company empower its lean EDI team to manage the rising requirements?
The Master Lock Company migrated its trading partner integration processes to IBM Sterling Supply Chain Business Network — a security-rich, cloud-based solution that reduces manual work for the EDI team.
International expansion can be a powerful tool to drive revenues and increase market share — but it also brings challenges. Operating in new geographies often means onboarding significant numbers of additional trading partners, each with their own specific local requirements.
This was the situation facing The Master Lock Company (TMLC), the largest global manufacturer and marketer of padlocks and personal safes. Harnessing both organic growth and strategic acquisitions, the company has launched international operations in new markets across Asia, Central America and Europe.
Connie Rekau, EDI Manager at The Master Lock Company, begins: “From the supply chain perspective, international growth creates a lot of additional opportunities. Managing local requirements in areas such as tax and invoicing controls is vital to support the business.”
TMLC’s retail business depends on electronic data interchange (EDI) to effectively communicate with its global base of trading partners. Like many leading enterprises, the company relied for many years on IBM Sterling Gentran® to onboard and manage its EDI integrations. However, with an average of 40 new trading partners to onboard every year — and the resulting incremental increase in complexity — TMLC’s lean EDI team was approaching its limits.
“We knew that we’d soon need to add at least three full-time equivalents [FTEs] to the EDI team just to keep our heads above water,” explains Rekau. “Instead, if we could outsource the most time-consuming aspects of EDI, we would be able to manage growth while freeing up time for higher-value development activities. We looked for a partner to help us adopt a more streamlined and efficient approach.”
Based on its positive experiences with the IBM Sterling Gentran platform, TMLC decided to migrate its EDI platform to IBM Sterling Supply Chain Business Network — a security-rich, cloud-based solution for trading partner integration.
“One of the biggest benefits of migrating our EDI to IBM Sterling Supply Chain Business Network is the fact that we no longer have to dedicate full-time resources to activities such as EDI mapping,” comments Rekau. “When we need to bring a new trading partner onboard, we simply submit our requirements to IBM and the majority of the work is done for us: we only need to validate that the integration works in the expected way.”
IBM Sterling Supply Chain Business Network is enriched with IBM Sterling Business Transaction Intelligence, which provides cognitive analytics capabilities to help businesses gain deeper insight into EDI processes using visual reports and queries written in natural language.
“If one of our EDI transactions fails for any reason, IBM Sterling Supply Chain Business Network sends us an alert, which is valuable on a tactical level because it helps us start to pinpoint the underlying cause straight away,” explains Rekau. “With IBM Sterling Business Transaction Intelligence, we can dig deeper into our EDI data to identify patterns that wouldn’t otherwise be obvious. As well as building a scorecard to track our performance against internal service-level level agreements [SLAs] with the business, we have set up reports that highlight trading partners with higher-than-average error rates.”
She adds: “If we send incorrect order acknowledgments to a customer, we’re exposed to the risk of financial penalties. Because IBM Sterling Business Transaction Intelligence is so user-friendly, our customer compliance team can now see the status of orders, shipments and payments in real time without any assistance from the EDI team — helping us successfully dispute chargebacks for data issues that were not our fault.”
As it extends its operations into countries around the world, TMLC must stay on top of a wide variety of local requirements for electronic invoicing. IBM Sterling Supply Chain Business Network Premium includes IBM Sterling E-Invoicing, a platform that enables businesses to exchange these documents in an automated, compliant and fully auditable way.
“The Master Lock Company was an early adopter of IBM Sterling E-Invoicing,” Rekau comments. “IBM continually adapts the platform as laws and integration standards change — significantly reducing the complexity of our international operations.”
Today, 95 percent of all TMLC’s EDI orders are processed via IBM Sterling Supply Chain Business Network with no manual intervention from the EDI team.
“Our migration from IBM Sterling Gentran to IBM Sterling Supply Chain Business Network was a seamless, straightforward process, and the IBM team did a fantastic job — particularly when it came to moving over our European trading partners,” adds Rekau. “We always know we can depend on IBM to jump on a request when we need their help, and we really value the responsiveness of their support.”
By automating its mission-critical EDI processes with IBM Sterling Supply Chain Business Network, TMLC can continue its fast-paced growth and focus on developing functionalities to support the business.
“By adopting the managed services model, we estimate that we avoided the need to employ three additional FTEs, which is a significant cost-saving,” says Rekau. “We believe we can comfortably accommodate ongoing trading partner growth for at least the next 12 months with the same headcount.”
She adds: “When the time does come to add new personnel, training them will be significantly faster and easier. We recently had a new person move into the team, and in less than two weeks she was fully up to speed with IBM Sterling Supply Chain Business Network.”
With IBM Sterling Business Transaction Intelligence supporting non-technical EDI users across the organization, TMLC can track its transactions faster than ever.
“IBM Sterling Business Transaction Intelligence allows our business users to easily track an order from inception to cash,” explains Rekau. “In the past, if one of our customers called in to ask about the status of a purchase order, our order management personnel would have to spend significant amounts of time piecing together the information they needed from technical EDI documents. Today, our team uses IBM Sterling Business Transaction Intelligence to cut through that complexity. As a result, they can find the answer to customer questions in minutes, and pass on any necessary information to our sales or compliance team in the event of an issue.”
She adds: “These kinds of business insights are also extremely valuable for our accounts receivable team. If a customer has acknowledged one of our invoices but not paid it, it’s often because they need additional information on the order. In the past, our accounts receivable personnel relied on the EDI team to retrieve this data, but thanks to IBM Sterling Business Transaction Intelligence they can now pull up the information themselves — streamlining the process.”
With managed services to support its fast-changing EDI requirements, TMLC is already rolling out support for new business models rapidly. When TMLC acquired a major safe manufacturer called SentrySafe, it needed to bring the company’s 200 trading partner maps onboard quickly, and support drop-ship orders for the first time.
“If we’d carried out the SentrySafe EDI migration on our own, we estimate it would have taken at least 12 months to complete the process,” recalls Rekau. “By engaging IBM, we completed the mapping work within just 6 months — 50 percent faster.”
On key retail events like Black Friday, the reliability of IBM Sterling Supply Chain Business Network helps TMLC take advantage of every opportunity.
“We see spikes in EDI traffic of around 250 percent on some points in the retail year, and many of those customers need their orders to be shipped within just 48 hours,” concludes Rekau. “Unplanned EDI downtime can make or break a year. I report on the availability of IBM Sterling Supply Chain Business Network every month to our executive team, and it’s never been less than 100 percent. As our business continues to grow, we’re confident that we have the EDI platform we need to effectively engage with more trading partners worldwide.”
The Master Lock Company is recognized around the world as an authentic, enduring name in padlocks and security products. Since its founding in 1921, the company has continually set new standards for lock design, application and performance. Headquartered in Wisconsin, USA, TMLC is the largest global manufacturer and marketer of padlocks and safes.
To learn more about IBM Sterling Supply Chain Business Network, please contact your IBM representative or IBM Business Partner, or visit the following website: https://www.ibm.com/products/supply-chain-business-network
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