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
"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
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
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
"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
"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
"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."