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Off-Road Cycle-Maker Sells Parts Online
Strategic Business Systems deploys Web system for KTM Sportsmotorcycle

By Rich Cirillo VARBusiness

11:36 AM EST Wed., Dec. 22, 1999

As a manufacturer of motorcycles for off-road racing, there's no question that KTM Sportmotorcyle is among the best in its class. But when it came to moving after-market parts to 260 dealers across the country, the company admittedly needed help in the distribution race.

In search of a more efficient and cost-saving solution that would provide immediate ordering and availability information on its 10,000-item parts line, KTM reached out to Ramsey, N.J.-based Strategic Business Systems (SBS), an IBM Business Partner who specializes in applications for the motor vehicle industry.

"They were experiencing inefficiencies on their parts distribution process," says Mike Herlihy, motor vehicle system product manager at SBS. "They had a lot of manual processing going on and were getting bogged down with that and with calls from dealers placing orders."

"Right off the bat they had the vision that they wanted to Web-enable the functions to be able to push out a lot of entry requirements to the dealers and take some burden off the warehouse staff."

Mike Herlihy, motor vehicle systems product manager for Strategic Business Systems and Patrice Mitchell, VP Product Management and Segment Solutions, AS/400. Photo by Michael Gaffney.

SBS recommended using its Parts Distribution System (PDS) for the job, and advised KTM to replace its existing Windows NT server with an AS/400e Model S10 system to operate and manage the distribution business. The company chose LANSA software to Web-enable the entire system into an Internet solution. 

"What was unique is that they are relatively small in the realm of an IT area. They really didn't have much expertise, so we recommended a server that was scalable and reliable so they wouldn't have a lot of downtime," says Herlihy. "That way they could automate their warehouse and ordering procedures from the dealer to fulfill inventory from their warehouse."

Before moving ahead with the integration, SBS and KTM conducted a poll of the participating dealers asking them what type of functions they would most like to see in a new system. Real-time information on parts availability and on-line ordering were among the top requests.

Working with LANSA, SBS developed a Web hookup to the PDS system that would integrate in real-time with the parts distribution system and price and inventory files. The solution was also designed to allow the dealers access to KTM's three separate franchises--KTM Sportmotorcycle, Husaberg Motorcycles and WP Suspension--with a single sign-on command.

"This enabled KTM to have dealers enter their parts orders and automatically check inventory so they can know on-the-spot whether they are available or will have to be back-ordered," says Herlihy. "That added a pretty significant automation to the process."

The first stage of the integration involved automating the back-end processes via the PDS system. According to Herlihy, the first data test site was up and running within three months of the time KTM agreed to the project. A number of KTM's highest-volume dealers went on-line as a beta test soon afterwards, and the system was extended to the rest of the dealers over several months.

The LANSA-based parts distribution system resides on KTM's own AS/400 server, with a network-level connection to the Internet via a T-1 line, complete with firewall and security applications. While the dealers can choose their own Internet service provider for access, they are limited to those which offer Netscape Navigator or Microsoft Internet Explorer.

"They have been up and running for more than a year now, and the dealers say it's simple to use and 'slick,'" says Herlihy. "The idea was that they wanted to make it as easy to use as possible so they could make their business cycle more efficient and be competitive in the after-sales parts market." 

The reduction in red tape ended up increasing KTM's parts sales by 25 percent and also managed to cut in half the number of telephone inquiries made to the warehouse about stock availability. "They had wanted to cut down the number of calls, but I don't think they understood just how significant it would be for their business," says Herlihy.

"KTM has made it a lot easier for us to place part orders with them," says Bud Matto of Matto Cycle, a Pa.-based dealership that was one of the first to implement the system. "We deal a lot with the racing crowd where quick and easy access to parts is crucial. This system allows us to keep our customers riding."

SBS, which has been working with LANSA technology for the past two years, chose to use the application for its PDS because it is a complete end-to-end tool for Web-based solutions, says Herlihy.

"What we were looking for was a real-time interface with AS/400 data, and in our evaluation LANSA was by far No. 1 in that area. It takes all the work out of accessing the back-end database, and it generates applications and deploys them to the Web so we can customize how the Web site will look." 

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