PCI Helps MEMOREX Create Global Commerce Solution

Is it live or is it Memorex?® — Memorex Products, Inc. is the industry sales and marketing leader of digital media and media accessories. Since the early 1970s, Memorex has been one of the most widely recognized and respected names in the consumer electronics industry. Today, it is an influential brand in CD and DVD media, optical drives and USB flash drives. Memorex is headquartered in Cerritos, Calif. To supply an ever-growing sophisticated and demanding consumer base, Memorex must constantly upgrade and improve its world-class service and delivery platform, taking advantage of the most-promising and effective technology advances.

The situation

In 1998 Memorex recognized that the limitations of their current homegrown ERP solution were adversely impacting their growth. Senior managers were deeply concerned with the seven-year-old system’s ability to scale and provide the functionality Memorex needed to ride the digital media wave into the 21st century. Additionally, looming Y2K concerns were also a high priority.

Memorex had grown significantly over the past few years and it showed. This resulted in late and incomplete shipments, a growing inventory management problem, as well as growing customer service issues. These issues were beginning to take its toll on employees, managers and customers alike.

The company’s customers, including Wal-Mart, Target, Circuit City, Kmart and CompUsa, were demanding significant improvements, or they would look elsewhere for their media products. The time had come for a complete overhaul of the company’s delivery and distribution systems. As a result, an internal solution selection and acquisition team was formed to identify the best solution.

Solution

After an exhaustive software evaluation and selection process, Memorex selected JD Edwards EnterpriseOne ERP over several competitors, including SAP, QAD and Baan. Now that Memorex had selected its ERP solution for the 21st Century, it needed a quick and effective implementation to beat the rapidly approaching Y2K deadline. Memorex selected JD Edwards to perform the implementation. For various logistical and business reasons, the implementation was split into two phases. The financial/accounting applications would be implemented first, with distribution and logistics in a second phase. The implementation was successfully completed and all Y2K issues were addressed satisfactorily.

After implementation Memorex management was not altogether satisfied with the overall ROI from the implementation and immediately sought outside help and guidance to improve ROI. After significant introspection, discussion and analysis, PCI was retained to essentially, re-implement the software to optimize business process and improved ROI.

During the course of re-implementation PCI sought to involve much more of the Memorex line personnel, including them in such activities as defining and validating business processes, documenting subsequent procedures and conducting all project-related testing activities. This involvement proved to be a critical success factor when the re-implementation was completed. In addition to the strong and effective project management of PCI, all significant and relevant busi-ness process were analyzed, documented and re-engineered, where appropriate. As a result of the functional and technical expertise PCI, the re-implementation project successfully launched on July 1, 2001.

As part of the re-implementation effort, Memorex opted to customize some of the standard software functionality. PCI’s engineers ensured the effort was quick and painless, tailored to Memorex’s requirements.
“What has always impressed me about the technical consultants at PCI is their deep and broad understanding of today’s relevant business issues, in addition to their technical prowess,” said former Memorex Vice President of Information Technology Marc Kammerath.

Benefits / ROI

Not only were Memorex senior managers pleased with the re-implementation results, but probably more important, so were the Memorex line employees. From the customer service representatives, to the distribution center employ-ees, who pick, pack and ship the products, the results were evident from the very first day using the new system. Even though PCI provided ample post go-live support, none was truly needed after the first week on the re-implemented solution. Needless to say, employee morale, throughout Memorex greatly improved with the re-implementation of the new solution.

On time deliveries and order completeness were also drastically improved, with the use of the new solution. At the conclusion of the first year using the re-implemented software, over 98% of deliveries were on time and order completeness improved significantly.
Customer service issues were also improved, with the new solution in place. After the first full year of operation, service issues were down more than 75% from the prior year and inventory management processes were noticeably improved. For the first full year in operation, Memorex sales grew in excess of 33%, while inventories, of all product categories actually declined by over 24%.

One measurement near and dear to both Memorex and their customers is the in-stock percentage, as measured by the retailer. This measurement speaks to the percentage of time a supplier’s product is actually on the retailer’s shelf, available for sale. After a full year of operation on the re-implemented solution, Memorex and its customers reported a significant improvement of the in-stock measurement — another tribute to the overall success of the new solution.

“We couldn’t have selected a better partner than PCI for this critical juncture in the life of Memorex,” said Memorex CEO and President Mike Golacinski during a celebration party hosted by Memorex to thank both employees and PCI for the success of the re-implementation project. “PCI truly cared about our business and our ultimate success.”

Enviroment

1. JD Edwards EnterpriseOne ERP, version 8.0 running on IBM I-series, employing CITRIX MetaFrame to deploy the application to approximately 200 users in North America.