What a Difference a Year Makes - Modern Distribution Management

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What a Difference a Year Makes

Epicor conference confirms a tipping point for distribution in 2018.

We started this year with a webcast that put a stake in the ground that 2018 is a tipping point for distribution across a number of fronts, the top ones being digital and analytics adoption. I’m feeling pretty good about that nearly halfway through, with the most recent validation here at Epicor’s annual user meeting. Here’s why.

First, Jergens Inc., an $80-million Cleveland-based industrial distributor and tooling manufacturer, won a customer excellence award, partly in recognition for a button they developed. Button? The company includes vending solutions as part of its services package, and developed a wifi button on customer parts bins that triggers auto-replenishment. It’s a low-cost, low-tech application of high-tech that is making it easier for customers to order effortlessly from Jergens, while driving revenues. Stay tuned for more detail in MDM on this.

Second, much of the focus at this conference is on new e-commerce and analytics features. The interest and conversations by customers here are not around whether to adopt e-commerce solutions or analytics, but rather how the first stages of implementation and acceptance are going. That’s significant; it indicates to me that we are indeed transitioning from a “push” to a “pull” environment where digital and analytics is starting to get a lot deeper into organizations than even a year ago. Here’s an example.

One distributor talked about its adoption of a BI tool that was intended for top management. Then it was shared with the sales management team. Once the sales managers started talking with their reps about the performance metrics the dashboards were providing, the salespeople wanted a piece of the action. The sales team now has iPads they use before a call to get a snapshot of the customer—credit status, recent orders and more. That’s driving analytics to the front lines and is a key to what a deeper analytics journey looks like. A key to this is that it's a tool the average person can use, not just a "techy" power user. Analytics is moving closer to mainstream in 2018.

There’s another indicator here this year. Customers of Prophet 21 and Eclipse know there were more than a few shifts as the legacy companies were acquired by Activant Solutions—2005 for P21 and 2007 for Eclipse, then Epicor (2011). By all accounts, the journey was a turbulent one that saw historically strong support and customer relationship dip in the transition process that inevitably happens in acquisitions.

Full disclosure: I have tracked P21 and Eclipse and have been close to many of their customers since P21 was a $38-million software company in the early 1990s that ultimately became the consolidation platform for niche distribution software; they then got gobbled up in fairly quick succession by Activant and then a private-equity Texas two-step (well, maybe not entirely Texas, but the conference is in Nashville this week so I had to get some kind of reference to country music into this blog). Even more recently, Epicor has had its own PE-ownership transitions.

In the words of one customer: “If we come back next year and there’s another management team in place, then that’s a problem.” But the customers I’m talking with here note a leadership stability in place that has to be encouraging and is backed up by the announcements here this week to support customers in their digital transformation options.

Among the announcements: Epicor reported an expanded partnership with Microsoft to standardize cloud deployment of its Epicor and Epicor Prophet 21 ERP suites on the Microsoft Azure platform. The company also has upgraded the Prophet 21 and Eclipse platforms for digital across a number of areas—user experience, e-commerce, analytics, plug and play—that are critical for distributors looking to fully leverage their IT resources more strategically.

The bottom line for distributors in 2018 is that regardless of ERP system, it is critical to have one that provides an adaptable platform for continuously building stronger online capabilities. We have a way to go, but we’re at a point in 2018 where instead of being handcuffed by legacy systems when it comes to digital, distributors have more options at lower cost than ever before. The distribution software ecosystem is getting more competitive once again; that’s good for distributors.

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