Software used by metal service centers has come a long way in the last few years. Advancements in technology and data science have given the latest generation of service center software a host of user-friendly features that promise to help metals businesses run faster and operate more efficiently.
According to a recent survey of metals-based companies by technology firm Crowe LLP
and American Metal Market
, 58 percent of executives polled said new technology is “very important” to their company’s three- to five-year business strategy. When asked about future IT plans, 68 percent of those same executives said upgrading or implementing an ERP system
is at the top of their lists.
“ERP is the major kind of enterprise application that service centers are using,” says Tony Barnes, senior manager on Crowe’s metals industry team. “ERP is kind of the backbone of any manufacturing business, service centers included. It’s the software that handles financials, sales, procurement, inventory, the broader supply chain, quality, planning; it really does all things for service centers.”
The term ERP isn’t new, but modern ERP systems are light years ahead of their more dated counterparts. That’s because software developers have taken large steps toward designing ERPs that offer a broad range of solutions in a single piece of software.
“What they’re all trying to do now with their applications is present a single solution that can do all of those things,” Barnes continues. “A lot of the legacy ERP systems service centers are using are limited in what they can do, and these service centers need a modern application that can do the things you need for ERP but can also do the transportation, can also handle the analytics. Now, what a lot of service centers are doing is they’re investing in those core ERP systems.”
Lured by the prospect of increased functionality and efficiency, service centers are making the decision to upgrade their software. As a result, software vendors, such as Ontario-based 4GL Solutions, are reporting a noticeable uptick in business.
“There’s no doubt that we’re getting more and more inquiries from service centers,” says Paul Parsons, vice president of sales and marketing at 4GL Solutions. Parsons notes the company has seen its customer base more than double in the last three to four years. “A service center may have a rudimentary system, even as rudimentary as using Excel to manage their inventory; they’re starting to recognize that that’s not the way they’re going to be able to grow, and they’re looking for more sophisticated software.”
Peter Doucet, vice president of consulting at Dallas-based Invera agrees. “We’ve seen a nice increase in service center activity over the last couple of years,” he says. “Some companies have had the same system for a while, and it’s dated for their business. Their business is changing, and they’re looking for new software.”
With so many options available, the decision to add or upgrade an ERP system is not an easy one. To help with this important purchase, Metal Center News talked to the top metal software vendors about the major trends and recent advancements in service center software.
Doing More with Your Data
Data science is one area where a lot of software developers are focusing their energies. At Crowe, which offers the Metal Accelerator ERP platform, the company is taking data science further by committing energy and resources to help customers get the most out of the info they collect.
“We have made a major investment in the realm of data science and advanced A.I. machine learning,” says Barnes. “We’ve got a team of over 30 Ph.D. data scientists who are helping our clients make sense of and be more predictive with their data.”
This means taking the company-specific data that’s been gathered over the years and using it to predict future trends and gain valuable insight into the way a business operates, Barnes explains.
“Everybody is looking for that insight into their data,” he says. “If I’m to know what’s really going on at my company, what’s really going on with my customers, what’s really happening in my supply chain, I need a better view of the data.”
One of the major trends in software-based inventory management solutions is barcoding. Because service centers have so much money tied up in inventory, figuring out ways to better manage and record changes in their product offerings can help save time and money.
Brian David, director of sales at Jonas Metals USA (formerly Compusource), says service centers are increasingly concerned with optimizing the way they manage their inventories.
“More and more companies are interested in implementing barcoding systems on the shop floor for warehousing and inventory management and simplifying that procedure,” says David. His company’s MetalCentric software promises “sophisticated inventory control” using barcoding technology designed to greatly simplify inventory management. “Anything they can do to lower cost on manpower designed around inventory is going to be a profit booster for them.”
Parsons, whose company, 4GL Solutions, offers the Steel Manager III ERP system, says customers who have converted to a barcode system are thrilled with the benefits. “It greatly increases the productivity of their warehouse staff, eliminates potential errors in terms of picking material or shipping material, and they can use a handheld devices to track the production time of a certain order,” he says. “Certainly, barcoding is something that more and more customers are looking at.”
Moving to the Cloud
The trend toward offering a cloud-based software option is not new, but it is intensifying, with most companies now offering some form of a virtual server option.
“The cloud is only continuing to gain steam,” says Barnes. “It has hit that tipping point where cloud is just kind of a given. It’s not a matter of if, it’s a matter of when you’re going to make that move.”
Moving to the cloud option has several benefits, according to the experts, including eliminating any concerns you may have over managing your own server.
“We offer an option for people who buy our software to either use a cloud option or host it themselves, but certainly the trend now is very clear most people go for the cloud,” says Doucet of Invera, which offers the Stratix ERP system. “Our cloud option has a disaster backup mechanism, where we host the customer’s data in more than one site. We’ve done that because we see the trend continuing to be very strong, so we want to make sure that we have as reliable an environment as can be provided to our customers.”
Software makers such as Invera are placing an emphasis on mobile technology. The company’s Shop Floor Mobile application comes built into the Stratix ERP system and allows users to perform a number of functions on their smartphones.
“In the not-to-distant past, you had terminals on the shop floor, and operators would go to a terminal to do their work,” Doucet explains. “We’re definitely seeing a trend toward having this type of work go mobile.”
He says anyone from machine operators to material handlers to truck loaders can use a smartphone with a barcode reader to perform certain tasks, such as scanning and recording information on the spot. “It means not having to write things down and go to a terminal,” says Doucet.
Online customer portals are another emerging feature of modern ERP systems. These website add-ons give service centers’ customers the ability to access specific information regarding an order anytime online, freeing up a service center’s staff to handle more important work.
“One of the real time wasters at a metal service center is the amount of time spent when customers call sales staff or support staff because they need a copy of the material test report or certification or they want a copy of an invoice or a proof of delivery; all of those things take time,” says Parsons. “Our customer portal is a great time saver, and it really is going to free up the sales staff so that they can focus on what’s important, which is obviously selling products to their customers and servicing them.”
4GL Solutions’ customer portal is customizable, meaning the service center can decide exactly how much of the portal they want to make accessible to their customers. Available functions include looking up inventory levels, selecting “favorite” products for later browsing, placing orders, checking the status of orders, requesting a quote, generating a quote, and reviewing sales orders and related documents, such as an invoice or proof of delivery.
“Service centers are trying to find ways to free up their staff to be able to focus on what’s really important, as opposed to doing manual tasks to assist customers in finding information that the customer can find for themselves,” Parsons adds.
With the freight market stretched thin and logistics costs on the rise, it’s no surprise that a lot of service centers are making the decision to bring logistics in house. This move is not as simple as purchasing a few trucks and hiring a few drivers. It requires planning and advanced software to make sure logistics operations run smoothly.
Software developers are taking note of this trend and making transportation management a standard function of their ERP software. David, of Jonas Metals USA, says his company’s transportation management feature helps service centers optimize routes more efficiently, improve utilization of vehicles, and reduce miles driven and maintenance on trucks.