Improving Efficiency & Profits with Tribute, Inc.
Hydraulic Controls, Inc.
by Chuck Hranac, Corporate IT Manager
Company History
Hydraulic Controls Inc. was founded in 1965 by Richard Cotter in a modest facility in Emeryville, California. The emphasis for our initial business program included sales of hydraulic equipment for mobile applications as well as for industrial applications, reflecting the nature of two principle product lines.
It was determined early in the business that a branch operation was desired in the center of the Sacramento Valley where a considerable amount of business was being developed with specialty manufacturers of fruit harvesting and product handling machines. A small branch was established in a rental facility north of Yuba City to provide local inventory support and service capabilities to our customers in that area.
Subsequently, branch operations were established in Redding, Stockton, Fresno, and Tulare, California. Concurrently, we opened branch operations in Salt Lake City, Utah, Denver, Colorado, and Phoenix, Arizona. Through the acquisition of the facility built by one of our original product line manufacturers in Hawthorne, California, we established an important presence in the great Los Angeles market. The San Diego facility was developed through another acquisition several years later.
HCI Partners with Tribute, Inc.
During Hydraulic Controls’ (HCI) growth, technology advanced by leaps and bounds. In 2001 HCI stepped into the 21st century by partnering with Tribute Software in order to better manage inventory levels, control finances, and provide high levels of quality customer service. Tribute Software and their staff assisted in an implementation which spanned across eleven branch offices and four states. This was no easy task nor was it without its problems.
In January 2002 management made the conscious decision to upgrade the technology yet again by completely reworking the network, computers, switches, routers, and printers. Once again, Tribute was there to assist with their excellent knowledge and willingness to help.
Reconstruction of eleven branch networks took approximately 12 months. The original equipment consisted of WYSI monitors, port servers and miles and miles of serial cable and connections. Over the same time period and an extra year the I.T. Department replaced or implemented 170 new personal computers, all assembled by HCI I.T. staff. (Two people)
During the 2002 through 2008 fiscal years Tribute has played a key role in the continued success of Hydraulic Controls by providing straight forward business solutions such as Auto emailing and faxing of invoices, statements, and acknowledgements to our customers.
Once the miles of wire were replaced by organized CAT 5E cable we saw immediate network improvements such as speed increase, reduced outages and less maintenance. This improvement itself reduced costs due to the reduced hours spent maintaining old equipment and the time saved could then be used to implement other cost saving features.
In January 2004 Tribute trainers Kelly Baughman and Sue Malyj were invited to visit Hydraulic Controls to conduct an operational audit. The results of this audit proved to be priceless in the planning of future steps necessary to remain successful.
The end result was that HCI had the tools to conduct business, track that business, and provide excellent customer service, but some basic procedural documentation needed to be created and addressed at all levels. Tribute was once again a very valuable asset in assisting HCI in creating the outline for the process vision.
Such issues as dead inventory were addressed - how would we manage that inventory and begin to reduce it. Over the past 4 years HCI, with the help of a new Director of Inventory Purchasing, Tribute Software, and the use of Tribute analysis reports, has been able to reduce inventory by 2 million dollars. This has significantly improved cash flow, reduced cost of operation and made for a much easier inventory management cycle.
In 2004, HCI implemented bin location and cycle count management at all eleven branches. This was a huge undertaking since no one at HCI had ever done bin location or cycle counts before. Every branch had to have the warehouse reorganized, then input all inventory bin locations on shelving and into Tribute.
The full process took approximately 16 months to complete. Once completed, HCI realized tremendous time savings. Pulling customer orders due to the use of bin locations printed on packing lists was much faster and weekly cycle counts have reduced inventory errors in most branch offices to less than ½ percent.
Cycle counting also identifies problem areas quickly so they can be dealt with in an efficient manner. Implementations such as cycle counting have been key in the management of inventories across eleven branch offices. We’ve also saved money by eliminating the need for annual inventory counts, which rack up the overtime hours and detract from daily business. Bin Management has been crucial in this program by setting locations for each item, making shelving and pulling product more effective and less costly.
In 2005 with the help of Tribute support and hardware staff, Hydraulic Controls implemented the integration of UPS Worldship across eleven branch offices. This integration reduced shipping errors made by incorrect input of addresses and sales staff errors. The previous lack of traceability caused many hours of wasted admin time. Once UPS was integrated with Tribute, we instantly saw a reduction in mis-shipped packages and the export of information from UPS to Tribute provided instant tracking information.
In 2009, working with UPS and Tribute, HCI implemented full integration of our sales staff with UPS Quantum View, which allows us to follow our freight from point of shipment to point of delivery with a couple clicks of the mouse and the internet. This service also provides downloadable files from UPS which can be used to audit freight bills. This feature helps HCI audit our invoices from UPS and ensure we are receiving proper discounting on all invoices.
The economy in 2008 presented another challenge for HCI, in that we saw an immediate need to reduce costs of operation. In order to do this we called on Tribute once again. The auto-faxing and emailing system was the next logical step in the reduction of operating costs. By implementing auto-faxing/emailing the company was able to reduce the amount of paper used in sending invoices, statements, and quotes. The realized savings amounted to about $30,000 between 2008 and 2009. Once again technology was the best way to reduce operating costs.
As Hydraulic Controls continues to move forward in its business model, we will continue to use Tribute as a base line for growth, technology, cost reduction, and business practice streamlining.
Future projects may include working with Tribute software partners Rubber Tree Systems and Tour De Force for the sales staff marketing capabilities which include CRM and Real-Time data throughput. Our outside sales staff would be able to track and follow up with important sales leads using CRM technology. Blackberry phones would provide up to the minute quote status, sales information and connectivity to the global market we all work and live in.
We see Tribute as a great business partner for many years to come.
Hydraulic Controls, Inc.
California, Arizona, Colorado & Utah
www.hydraulic-controls.com
