
E-Business Challenge: Get Up And Running In 90 Days
December 2000
Here's the rub: Your boss- no, even better, the president of your company- tells
the world you're going to be e-commerce capable in 90 days. "Damn the torpedoes,"
he says, "full speed ahead!" Unfortunately, he forgot to tell you- the head of IT
development- about it. Ten days later, the financial world still shaking from this
tremor-inducing announcement, the news trickles down to you. "Huh? What?" you ask,
already thinking, "I've already lost more than a week. I've only got 80 days left."
Such is the life of IT development departments. A dictate comes from on high, and you
figure out how to make it work, while also performing your everyday functions. If you
succeed, fine- here's your bonus. If you fail, well- here's your pink slip.
And that's pretty much the situation Carrier Corp. recently faced. On Feb. 14, 2000,
Jon Ayers, president of Carrier, vowed to a group of market analysts that the company's
Replacement Component Division would have an online order-processing application up
and running in 90 days. The target date for live implementation was May 14.
Many people would have balked at the proposal, claiming they had neither the time nor the
resources to meet the deadline. The IT people at Carrier did exactly the opposite,
seeing the situation as an opportunity rather than an obstacle.
AVOIDING DIGITAL SHRAPNEL
The Farmington, Conn.,-based Carrier (www.carrier.com) is a subsidiary of United
Technologies Corporation and has more than 43,000 employees in 173 countries. The
company also is the world's largest air-conditioning and heating manufacturer, making
a comprehensive variety of heating and cooling products, from small window units
for the home to gargantuan chillers for commercial buildings.
Carrier's Replacement Components Division, which is located in Syracuse, N.Y., is one of the
company's business units. As its name implies, this department is in charge of distributing
a full line of factory-authorized replacement parts and complementary products,
including air filters, motors, and valves. Under the brand name Totaline, the parts are
distributed to both Carrier-owned and independent resellers throughout the world.
Before the decision was made to implement an online ordering system, orders from these
resellers were taken through traditional methods, including faxes, telephone calls,
and marketing representatives. The company also had an SNA network that distributors
could use to interact directly with the company's AS/400, which was upgraded to a Model
720 running OS/400* V4R4 in October.
In this latter case, resellers could place orders directly into the company's JD
Edwards application or batch their orders for later transmission and processing.
This was unnecessarily confusing for them, however, because they had to deal with
workstation-based green screens to access Carrier's JD Edwards application via the
network.
According to Peter Lotto, senior manager of Business Integration and e-Business in
Carrier Corp.'s Replacement Components Division, "You really had to be an AS/400-
knowledgeable person to do it. The screens were complicated, and there were even
more fundamental problems or complications. For example, in order to set shipment
priority, you had to know that 0 was standard, 4 was next day, and 5 was same day."
In addition, Carrier uses so-called intelligent part numbers, meaning every digit, letter,
and space in the number is context specific. For example, someone placing a direct order
over the SNA network might have to enter "space-space-LH-space-680-space-space-space-005"
to specify a part. This resulted in a lot of confusion and errors, with misplaced
digits, letters, or spaces resulting in rejected orders.
As Lotto puts it, "If you didn't place the order with the appropriate spacing, it would
blow up in your face." It would have been much easier, then, if people could enter
"LH680005" without the spacing.
Similarly, when distributors checked on order status, they were greeted with a
typically vague green-screen response. Order status code 565, for instance, meant
that an order was picked and packed but not yet shipped. For distributors,
keeping up with these significant but easily forgotten codes was a chore.
With the company's mandate made clear by its president- that an annual running rate
of $100 million eventually be conducted over the Web, Carrier's Replacement Components
Division had no choice but to get busy. (A run rate is a rate of sales from a period
of less than a year converted to an annual basis. In the case of the Replacement
Components Division, the run rate is the amount of the company's sales multiplied
by the days in the year- or around $400,000 per selling day.) It would provide an
Internet-based online solution that would simplify order placement and tracking for
its distributors.
The only question now was whether its IT department could meet the established
May 14 deadline.
AN INTERACTIVE PROCESS
"When we heard about this announcement, we went on a crash search for a partner
that could help us meet our timeline," Lotto says. "We started our discussions with,
'We have a 90-day deadline. If you tell me it's going to be 91, I'll have to move
on. If you tell me it's going to be 90, you better be able to deliver in 90."
Lotto and his staff of two queried several local Internet houses, none of which could
promise a developed and tested solution by May 14. As it turned out, he found his
partner after reading an article in a magazine- and then looking at the company's
ad.
We were sort of fumbling about when we saw the article and an ad," he explains. "When
we were reading it, it looked like these guys were too good to be true."
"These guys" happened to be the Kirkland, Wash.-based ADVANCED BusinessLink
(www.businesslink.com). After talking with company representatives on the phone,
Lotto sent one of his staff to the company's headquarters. In the meantime, he
cold-called some of ABL's former customers, grilling them about the type of work
the company had done for them.
When Lotto's representatives returned to Syracuse, he said, according to Lotto,
"These guys look like they're for real. And they told me they could meet the
deadline."
With that endorsement, Lotto and his team got busy putting the paperwork in order
and bringing the company on board. By mid-March, ABL was working on the project,
coordinating with Lotto and his staff to build the online solution Carrier's president
had promised the market analysts.
For their part, Lotto's team provided ABL with Carrier's business and technical
requirements. "We gave them information about what our files looked like, how we
had implemented JD Edwards, and created data feeds for them and data feeds back
to us," Lotto says.
ABL, meanwhile, was using a base version of its Strategi e-business application to
interface with Carrier's JD Edwards application and craft the site, writing all the
necessary HTML and, as an added, unbidden bonus, the wireless mark-up language used
for a wireless component of the site. Working in tandem, they soon had a version
of the e-business application to test.
"It became an interactive process," Lotto says. "We would talk to them every day to
see what kind of progress they were making, and they would post a version of it
for us to look at. We'd say yes or no, and then move on."
On the night of May 11, ABL put the final touches on the application, readying it for
its live debut on May 12- two days before the May 14 deadline. "If implementations
can ever be simple, this one was," Lotto says.
THE REAL POTENTIAL
And the proof is in the pudding, as they say. Ninety days after the site
(www.totaline.com) went up, the company was operating at a run rate of $30
million annually over the Web- well on its way to reaching its $100 million
goal. Additionally, the company has reduced calls to its customer service
center by 30 percent. And then there are the innumerable data-entry errors
that have been avoided.
To use the site, users request a user ID and password from a customer service
representative. Once they're registered, they can log on and begin placing orders.
As of September, the company had 100 registered users representing around 80
or 90 distribution companies. "We've taken orders from everywhere, from Norway
to Finland to the Far East," Lotto says. "We took an order last week from the
Philippines."
Given the ease with which the site can be used, this increasing user interest isn't
surprising. All that the distributors need to access the site is a PC, Web browser,
and Internet connection. Once they're logged in, they can place and track orders
without having to deal with enigmatic numerical codes (a UPS tracking code is
presented for shipped items, which users can cut and copy into the UPS site to follow
the progress of their order). And the part ordering process has also been simplified.
They now have the ability to run fuzzy searches, using an asterisk as a wildcard. For
example, if a part number begins with LH680, they can enter LH6*, at which time
the system will search for all parts beginning with LH6. Users can also use
descriptive terms to find what they're looking for. "IGN*" or "igniter," for instance,
would bring up all igniter products.
"By offering an Internet-enabled ordering system, our distributors are no longer tied
to green screens," Lotto says. "They're no longer tied to the private network.
They can place orders from anywhere with a local phone call, which is certainly the
attraction for our international customers."
And speaking of anywhere, there's also the wireless component to the solution. While
still not widely used, it allows cell phone and personal digital assistant users
to place and trace orders from wherever they are. In cases where users are at a
job site, this type of direct connection is a boon, giving them much of the power
of the Totaline Web site in the palm of their hands.
"The ultimate application we see for this is in situations where customers are out
of the office, staring at a broken air conditioner or furnace and saying, 'I need
a motor. I need a heat exchanger.' They can then access a text-only version of the
site and place an order," Lotto says.
This will help reduce what Lotto calls "windshield time," or the time distributor personnel
spend driving from their job sites to a parts depot to get the needed components.
Using the wireless version of the site, they'll be able to place an order wherever
they are and than have it delivered to their house or job site. "We're still
trying to understand the real potential for this," Lotto explains.
The site is making it easier for not only distributors, but also Carrier's staff, to do
their jobs. When orders are placed, they're dropped into a file maintained on an
ABL-managed AS/400. Every 10 minutes, the contents of that file are transmitted
to Carrier's AS/400, where the orders are automatically sent to the JD Edwards application.
This has reduced time formerly spent rekeying orders.
"This isn't one of those sites, of which there are many, where Internet input drops
out to an e-mail or a printout somewhere and someone has to rekey it," Lotto explains.
A PORTABLE SOLUTION
While Lotto and his staff may have felt the rub, they've more than compensated for it,
turning a potentially career-breaking announcement into a center-stage opportunity.
Not only have Carrier's customers been pleased with the Web site, but so has Carrier's
management, with word trickling down that even the chairman of United Technologies has
noticed. "If the chairman of a $25 billion company has to know your name, you want
him to know it for this reason," Lotto says.
Indeed, the Replacement Component Division's crash course in e-business has been
so successful that other Carrier divisions are interested in implementing similar
versions. To that end, Lotto and his team have been working with ABL to create a
portable version of the application that can be used elsewhere in the company.
"Nobody ever knew we existed before," Lotto says. "Now, the fact that the president
of the company knows we exist, calls our VP and even me- a lowly IS manager- is an
enormous lift to our division."
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