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Ridley, a manufacturer and distributor of animal feed and nutrition products, has plants and warehouses throughout the United States and Canada. The company needed a new enterprise resource planning system to manage its purchase of agricultural commodities and its batch-manufacturing processes of more than 47,000 customized product variations. With special attention to finding a flexible solution, Ridley analyzed its needs and considered solutions from Microsoft, SAP, and Oracle. The company chose to work with Microsoft® Gold Certified Partner Fullscope to implement Process Industries for Microsoft Dynamics® AX. Today, Ridley has the flexibility it needs to manage operations companywide. And, the company estimates that Microsoft Dynamics AX will save it more than U.S.$1 million a year in staffing and maintenance costs compared to a solution from SAP that it also considered purchasing.
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 Canada Process Industries for Microsoft Dynamics AX would Industry: Agriculture be over $1 million a year less than an SAP Customer Profile implementation.” 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 The company needed a new enterprise resource Ridley sought to replace its outdated enterprise resource planning system, but planning system to manage its purchase of agricultural needed customized functionality to commodities and its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 Benefits 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. www.ridleyinc.com 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: www.fullscope.com Software and Services Partners Microsoft Dynamics Fullscope − Microsoft Dynamics AX This case study is for informational purposes only. MICROSOFT MAKES NO WARRANTIES, EXPRESS OR IMPLIED, IN THIS SUMMARY. Document published April 2009
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