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Service center software: understanding processing--inside and out: software developers have enhanced their products to help service centers better forecast demand and control inventories while managing multiple locations and the flow of material to and from outside processors.

Article Excerpt
SERVICE CENTERS have experienced a series of highly profitable years, and many are reinvesting some of those gains to bring their management systems up to date. Systems providers, likewise, are busy upgrading their products to incorporate the latest software technology and address the changing needs of metal distributors and processors.

"The smart companies know the good times won't last forever and are taking the opportunity while cash flow is good to invest in new systems," says Tim Holman, director of marketing at Bayern Software Inc. in Phoenix, Ariz., echoing the sentiment expressed by most software companies.

Peter Doucet, vice president of consulting at Invera, Newtown Square, Pa., says his company's STRATIX enterprise software sys tem is receiving strong inquiries from service centers, which are not only growing organically but through mergers and acquisitions. The integration of new acquisitions, and service centers' growing use of outside processors, greatly adds to the complexity of managing inventory and processing at multiple locations.

"Over the years, as service centers have tried to get closer to their customers, they've had to add processing capabilities. Often a particular process is not a big enough part of the business to warrant bringing equipment in-house, so they partner with an outside processor," Doucet says.

This presents special challenges for enterprise resource planning systems, notably keeping track of material once it has left the warehouse. Each software product tackles this task in a different manner, but Doucet describes Invera's approach.

"Historically, outside processing was treated outside of the normal order fulfillment cycle. To send material to an outside processor required entering a separate purchase order, as if it were a separate transaction. We have essentially blended outside processing inside of the standard order fulfillment cycle. With STRATIX, whether you are processing something in your own warehouse, in a sister warehouse or at an outside processor, it's really a common process."

To cite one example, say an order calls for the service center to burn a plate in its own warehouse, send it out for drilling at one outside processor, who then ships it to another processor for bending before sending it directly to the customer. STRATIX automatically generates purchase orders for the different steps that occur at outside processors. It detects that one process is being done at your warehouse and the others at outside locations, and automatically creates the transfer requests. Without paperwork shuffling from the sales department to the warehouse, shipping personnel can see on their screens that orders are due to ship to that processor, and can initiate the process with the click of a button. The system then generates the necessary shipping documents. Salespeople can monitor the progress of each order from their desktops as the system tracks them, Doucet explains.

AXIS Computer Systems Inc.,...

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