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									                                            Microsoft Dynamics
                                            Customer Solution Case Study

                                            The Right Supply-Chain Decision Saves Animal
                                            Feed and Nutrition Provider $1 Million

Overview                                    “We estimated that the maintenance costs for
Country or Region: United States and
                                            Process Industries for Microsoft Dynamics AX would
Industry: Agriculture                       be over $1 million a year less than an SAP
Customer Profile
Ridley manufactures and distributes         Jeff Kadlec, Director of IT, Ridley
animal feed and nutrition products, and
has plants and warehouses in 47 locations   Ridley, a manufacturer and distributor of animal feed and nutrition
in the United States and Canada.
                                            products, has plants and warehouses throughout the United States
Business Situation                          and Canada. The company needed a new enterprise resource
Ridley sought to replace its outdated
enterprise resource planning system, but    planning system to manage its purchase of agricultural
needed customized functionality to          commodities and its batch-manufacturing processes of more than
manage purchasing, inventory, and
processing for 40,000 product items in 47   47,000 customized product variations. With special attention to
locations.                                  finding a flexible solution, Ridley analyzed its needs and considered
Solution                                    solutions from Microsoft, SAP, and Oracle. The company chose to
Ridley chose Microsoft Dynamics® AX and     work with Microsoft® Gold Certified Partner Fullscope to implement
Process Industries for Microsoft Dynamics
AX, which gives the company financial and   Process Industries for Microsoft Dynamics® AX. Today, Ridley has
operational information on purchasing,      the flexibility it needs to manage operations companywide. And, the
warehousing, and manufacturing
operations throughout the company.          company estimates that Microsoft Dynamics AX will save it more
                                            than U.S.$1 million a year in staffing and maintenance costs
 Low total cost of ownership
                                            compared to a solution from SAP that it also considered
 Industry-specific functionality           purchasing.
 Greater adaptability
“Process Industries for               Situation                                       business from the back of a pickup truck, and
                                      With plants and warehouses in 47 locations      customer service has to be our number one
Microsoft Dynamics AX                 in the United States and Canada, Ridley         priority.”
gives us all the                      manufactures and distributes animal feed
                                      and nutrition products, and tailors products    The company’s ERP system used out-of-date
information about                     for individual farmers based on the nutrition   software running on an obsolete IBM AS/400
inventories, production,              needs of their animals. The company’s           minicomputer system. There was a growing
                                      processing plants mix the ingredients,          risk that a breakdown in the system might
shipping, and receiving               vitamins, and other nutrients in individual     have a catastrophic impact on Ridley’s
that we need to track                 batch processes—depending on formulas           business. “The software for the system was
                                      prepared for each customer—resulting in         no longer being supported, and the only place
and manage all our                    more than 47,000 variations.                    we could buy replacement hardware was on
specific products, and                                                                eBay,” quips Kadlec.
                                      Some of Ridley’s facilities operate with a
run our entire business.”             limited number of products and are able to      Solution
Jeff Kadlec, Director of IT, Ridley   take advantage of manufacturing runs of up      The potential cost of a system failure made
                                      to 100 tons. The company’s other plants         the decision to replace the previous,
                                      specialize in shorter runs, with batches from   outdated ERP system easy to justify, but a
                                      10 tons before stopping to change formulas      new ERP system would be a major
                                      and create a new batch with different           investment. Ridley conducted extensive
                                      ingredients.                                    analysis and research to document and
                                                                                      analyze its needs, and gathered information
                                      The company purchases ingredients from          from vendors about the possible solutions
                                      agricultural commodities markets all over the   that might meet its needs. After this
                                      world through a central purchasing system,      evaluation, Ridley invited representatives
                                      taking advantage of bulk purchasing and         from Oracle, SAP, and Microsoft for daylong,
                                      hedging options to secure the lowest-possible   live demonstrations of their product
                                      price. The commodities are delivered and        capabilities at company headquarters in
                                      stored at Ridley warehouses and processing      Mankato, Minnesota.
                                      plants in the field.
                                                                                      At the time of the evaluation, Ridley was part
                                      Ridley’s need to purchase and supply            of an Australian company, Ridley
                                      inventory for 47 locations and to track and     AgriProducts. The parent company had
                                      manage manufacturing processes for 47,000       chosen an SAP solution for its operations and
                                      unique product formulas meant that its          wanted the North American subsidiary to do
                                      enterprise resource planning (ERP) system       the same.
                                      was critical to its ability to operate. “Our
                                      purchasing is centralized, but we customize     Evaluating Total Cost
                                      our pricing system in every location. Because   Kadlec gathered additional information about
                                      of that, general managers and plant             the long-term cost of an SAP implementation,
                                      managers at each location need to be able to    which showed that Microsoft Dynamics® AX
                                      price their products for their market areas,”   could drive considerable savings through a
                                      says Jeff Kadlec, Director of IT at Ridley.     lower total cost of ownership. The data
                                                                                      persuaded the parent company to let the
                                      “We need to see the costs and profit margins    North American operation implement
                                      on every item, every sale, and every discount   Microsoft Dynamics AX. The Australian
                                      we offer,” he continues. “But, we still do      company later spun off its North American
operations, but Kadlec notes that the former       staff with the implementation of Microsoft
parent company has also migrated                   Dynamics AX,” says Kadlec.
operations to Microsoft Dynamic AX.
                                                   Centralized Deployment
To tailor Microsoft Dynamics AX to meet the        Ridley implemented Process Industries for
unique needs of its process-manufacturing          Microsoft Dynamics AX as a centralized
operation, Ridley turned to Microsoft® Gold        solution that will standardize business
Certified Partner Fullscope, a company with        processes across the organization, reduce
deep industry expertise and experience in          maintenance costs, and increase the visibility
enterprise resource solutions. Fullscope           of operations across the organization. And,
recommended Process Industries for                 the company gains the ability for local offices
Microsoft Dynamics AX, which offers                to customize the solution, based on local
extended functionality for managing and            needs. “We manage our purchasing from our
tracking the costs of batch-manufacturing          central office, but our managers in the field
processes.                                         have control over their pricing and their
                                                   product lines, based on the needs of their
“With Process Industries for Microsoft             local markets,” says Kadlec.
Dynamics AX, Ridley has better support for
batch manufacturing with rapid change of           The expertise in process industries that
formulas and the ability to link warehouse         Fullscope contributed was critical to the
inventory levels at multiple locations. This       success of the project, giving Ridley the ability
inventory information is used in tools to          to make adjustments during implementation
manage the purchasing or hedging of                and still meet expectations. Kadlec notes that
agricultural products from multiple sources,”      the initial implementation for the new
says Ted Root, Senior Account Executive at         solution was finished on time and under
Fullscope.                                         budget, despite the need to negotiate three
                                                   scope changes.
The process industries solution was
important to Ridley. “The additional               The company expects to finish rolling out
functionality was critical to our decision to      Process Industries for Microsoft Dynamics AX
purchase Microsoft Dynamics AX,” says              to field locations in late 2009. Says Kadlec,
Kadlec. “Process Industries for Microsoft          “We will start planning an upgrade to
Dynamics AX gives us all the information           Microsoft Dynamics AX 2009 after all
about inventories, production, shipping, and       company locations have converted from the
receiving that we need to track and manage         former ERP system.”
all our specific products, and run our entire
business.”                                         Benefits
                                                   Ridley now has a reliable ERP system that
Kadlec also appreciated that Ridley’s existing     gives the company the functionality needed
IT staff could implement Microsoft Dynamics        to run its operations and flow information
AX, further contributing to the lower total cost   throughout the company. With Microsoft
of ownership of the solution. Ridley’s existing    Dynamics AX, information flows
IT staff quickly acquired the skills needed to     automatically—from purchasing agricultural
deploy and manage the system without               commodities on global marketplaces to
expensive training or hiring new staff. “We did    providing batches of customized products in
this implementation with our existing staff. I     multiple locations. In addition, the company
have not added a single IT individual to our       has achieved a much lower cost of operation.
                                                Low Total Cost of Ownership                        Greater Adaptability
                                                Because Microsoft Dynamics AX is built on          Ridley was able to easily adjust the solution
                                                familiar Microsoft technology, Ridley’s IT staff   to meet its unique needs. “Our ability to
                                                was quickly able to adapt to the new system.       quickly make an adjustment in one of the
                                                The company saved the cost of adding people        applications or one of the modules to fit our
                                                with specialized skills needed to maintain an      business requirements has proven itself over
                                                SAP solution. People with experience in such       and over and over again,” Kadlec says.
                                                technical skills as SAP Advanced Business
                                                Application Programming or SAP Basis               “All of the functionality for the way we do our
                                                middleware tools are available in Mankato or       production processes was available, but it
                                                nearby Minneapolis, but only at much higher        was scattered throughout the application,”
                                                salaries. “I would have had to pay people with     says Kadlec. “Our production people analyzed
                                                those skills hundreds of thousands of              the solution and developed some custom
                                                dollars,” explains Kadlec.                         screens that brought all that together. Now,
                                                                                                   it’s truly a matter of four or five clicks of a
“With Process Industries                        “Our analysis of the potential savings was         mouse to send a product to our batching
for Microsoft Dynamics                          reviewed by an audit firm,” continues Kadlec.      system or interface with our recipe system or
                                                “We estimated that the maintenance costs           our inventory system.”
AX, Ridley has better                           for Process Industries for Microsoft Dynamics
support for batch                               AX would be over $1 million a year less than       “We needed the flexibility to include our
                                                an SAP implementation.”                            unique way of linking our batching systems to
manufacturing with                                                                                 our inventories. Process Industries for
rapid change of                                 Industry-Specific Functionality                    Microsoft Dynamics AX gave us all that. I'm
                                                With Process Industries for Microsoft              very excited about what we're doing,”
formulas and the ability                        Dynamics AX, Ridley can manage its complex         concludes Kadlec.
to link warehouse                               purchasing operations according to the
                                                company’s established business processes.
inventory levels at                             “The commodities that are the ingredients for
multiple locations.”                            our products are one of our largest capital
                                                costs. Microsoft Dynamics AX supports the
Ted Root, Senior Account Executive, Fullscope   ways we manage or hedge those contracts
                                                with our vendors. That gives us visibility into
                                                our inventories and the ability to see exactly
                                                where we are at any given moment. That was
                                                critical to our decision to go with Microsoft,”
                                                says Kadlec.
For More Information                                            Microsoft Dynamics
For more information about Microsoft                            Microsoft Dynamics is a line of integrated,
products and services, call the Microsoft                       adaptable business management solutions
Sales Information Center at (800) 426-                          that enables you and your people to make
9400. In Canada, call the Microsoft                             business decisions with greater confidence.
Canada Information Centre at (877) 568-                         Microsoft Dynamics works like familiar
2495. Customers who are deaf or hard-of-                        Microsoft software such as Microsoft Office,
hearing can reach Microsoft text telephone                      which means less of a learning curve for your
(TTY/TDD) services at (800) 892-5234 in                         people, so they can get up and running
the United States or (905) 568-9641 in                          quickly and focus on what’s most important.
Canada. Outside the 50 United States and                        And because it is from Microsoft, it easily
Canada, please contact your local                               works with the systems that your company
Microsoft subsidiary. To access information                     already has implemented. By automating and
using the World Wide Web, go to:                                streamlining financial, customer relationship,
www.microsoft.com                                               and supply chain processes, Microsoft
                                                                Dynamics brings together people, processes,
For more information about Ridley products                      and technologies, increasing the productivity
and services, call (507) 388-9400 or visit                      and effectiveness of your business, and
the Web site at:                                                helping you drive business success.
                                                                For more information about Microsoft
For more information about Fullscope                            Dynamics, go to:
products and services, call (256) 771-                          www.microsoft.com/dynamics
7050 or visit the Web site at:

                                                                 Software and Services                           Partners
                                                                    Microsoft Dynamics                             Fullscope
                                                                     − Microsoft Dynamics AX

This case study is for informational purposes only. MICROSOFT

Document published April 2009

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