Progressive Distributor - The end of the (paper) trail

The end of the (paper) trail

Brown Transmission uses a Web-based system to track cost savings documentation

by Rich Vurva

Distributors that track cost savings projects for customers understand the frustration with maintaining up-to-date logs of completed activities. Many distributors record savings in Excel documents and generate printed reports requiring a customer signature. In some instances, weeks might pass between the time when an event took place and the report is printed and given to the customer for a signature. Customer-approved reports are generally maintained in a filing cabinet or bookshelf, to be pulled out again when it’s time to do an annual what-have-you-done-for-me-lately review with the customer.

“If you have to wait two weeks or two months to document an event, you’re too late. The customer can’t remember it,” says Tom Clawser, sales and marketing manager of Brown Transmission and Bearing Co., a power transmission distributor headquartered in Lancaster, Pa.

Brown Transmission recently invested in a new Web-based system that improves the cost savings documentation process. Developed by Rubber Tree Systems in Toledo, Ohio, the system enables Brown’s customers to log onto a dedicated Web site, www.BrownSavings.com, and view cost savings activities completed by Brown Transmission employees. The system is based on a membership service called ptcostsavings.com developed by Rubber Tree systems for power transmission distributors.

When a salesperson or customer service representative enters a new savings document into the system, it automatically sends an e-mail to the customer.

“Instead of completing an Excel spreadsheet, e-mailing it to your customer and asking them to print it, sign it and fax it back, now Brown Transmission has a total interactive portal for cost savings,” says Brian Kazmierczak, president of Rubber Tree Systems.

Customers log in with a user name and password. With a click of a button, they approve the report.

Faster and better
Since switching to the electronic system last November, the company has become more proactive at seeking out cost-savings opportunities, according to Clawser.

“We’re doing more cost savings documentation than we used to,” he says.

In most cases, customers can view and approve reports within a day or two of the cost-saving event, when it’s fresh in their memory. The electronic reports go directly from the Brown Transmission employee to the customer employee most familiar with the activity, eliminating the need for managers to approve reports.

“When one of my salespeople generates a new report, a lot of times I don’t even realize it until later in the day or the following day when I go online to see our progress. That speeds the process. Under the old system, there was a lot more intervention involved,” Clawser says.

Under this system, the intervention is taken down to the grass roots level. The two people who initiated the cost savings are the only people involved throughout the approval process.

Clawser says the system also serves as a repository for managers to easily keep tab on the activities of specific employees or customers. He can see at a glance how many cost savings reports an individual submitted and the types of activities involved.

Customers not only appreciate getting reports in a more timely manner, they also like the simple approval process.

“In the old model, with its ensuing paperwork, most clients weren’t anxious to handle extra paperwork. But most clients are happy to go to a Web site and do a couple of clicks and be done with it,” Clawser says.

Once the cost savings activity has been approved by the customer, the salesperson can move onto other tasks. There’s no lingering paper trail to follow.

The system at work
Suppose a Brown Transmission customer service rep receives an urgent phone call from a maintenance manager whose production line is down because a conveyor motor quit working. The old motor is obsolete and the customer needs a replacement part pronto. The CSR finds an acceptable replacement, but it’s not in stock. It will take three days for an emergency delivery from the manufacturer.

The rep checks Brown’s inventory system and realizes the Reading, Pa., branch has the motor in stock. He orders an expedited shipment and has the motor trucked down to Lancaster that same day. The effort avoided two days of downtime.

The next day, the rep logs onto BrownSavings.com, enters the details of the activity into the online system — including the customer’s labor rate per hour and the downtime avoided — and the system calculates the total dollar savings. Within a 24-hour period, the rep has not only solved a problem that avoided two days of downtime, but he also sent the customer a report summarizing the cost avoidance activity.

“In the past, we reported progress at best once a quarter and often only once every six months,” says Clawser. “In the new model, that customer can look at their progress every week if they care to. If the client is going into a meeting and wants to report their savings month-to-date or year-to-date, they can pull that information up any time they want to.”

The system enables Brown Transmission to document a number of different cost savings activities, including unit cost savings, freight savings, cost avoidances and value activities, such as application engineering or onsite training. After entering the appropriate data, the system calculates the total savings.

Clawser says one of the side benefits of the system is that it has helped the company gain a clearer understanding of the types of activities that are important to customers.

“One of the worst things that can happen is to spend a lot of time engaged in activities that your client doesn’t care about. With this process, we’re able to collaborate on the activities they value,” he says.

To date, fewer than 10 customers are utilizing the system. Clawser says the company can be purposely selective in assigning user names and passwords to customers. If a buyer or engineer hasn’t specifically been assigned by his company to track cost savings, the program has little appeal. But it’s highly attractive to companies that are constantly on the lookout for cost reduction opportunities.