Some people might say that Rick Woldenberg's business is child's play. Woldenberg is the President/CEO of Learning Resources, a manufacturer of children's educational toys. His products teach educational staples such as math, science, and language, as well as early childhood favorites like counting, letters, and colors. And, with names like "Oogly Googly," "Subtraction Super Safari," and "Multiplication Monsters of the Deep," it's not hard to understand how the toys entice children to learn. Woldenberg is a man with a personal interest in his products, too; he's a father himself. Without doubt, these personal elements connect Rick Woldenberg to his business in a manner uncommon for most executives.
Understanding Your Industry, Understanding Your Technology
My first impression of Rick Woldenberg: a soft-spoken man with a bespeckled, turquoise tie emblazoned with the Learning Resources logo. I soon learned that although his company focuses on making learning fun for children, Rick Woldenberg does not play around when it comes to the company's technology. Learning Resources recently adopted new technology that incorporates an integrated enterprise and WMS solution.
My introduction to this technology began as he seated himself at a conference table in the company's Vernon Hills, IL headquarters. A light snowfall was visible through the large window at Woldenberg's back, and an Oogly Googly toy lurked over his left shoulder as he began to speak. "Well, what would you like to know?" he asked.
I requested a brief overview of the company. Although Learning Resources produces products worldwide, the Vernon Hills facility serves as its central point of distribution. All inventory is housed in and shipped from that building. And, although the company conducts business internationally (it has a second office in King's Lynn, England), it conducts the bulk of its business domestically. Learning Resources markets and distributes its products using a wide array of channels including educational dealers, toy retailers, government educational institutions, and a small direct-selling program through a retail catalog and its Web site. "Through our Web site, we can offer a full range of products to the consumer and provide a useful point of contact with our company," explained Woldenberg. "Our direct-to-the-consumer program is also a great way to promote the brand for our dealers."
Business Problems Indicate Solutions In ERP And WMS
With this wide assortment of distribution channels and the high demand for its products, Learning Resources realized it needed a supply chain solution that could help manage its inventory and business processes, from order management and manufacturing through shipping and receiving.
Learning Resources has a history of aggressively adopting and using new technology to improve its business processes. Most businessmen and technology vendors alike will tell you that implementing an ERP system is an enormous undertaking. Combining an enterprise resource planning (ERP) and a warehouse management system (WMS) implementation is particularly intimidating. But growth-related issues encouraged Learning Resources to install Lilly Software Associates' advanced enterprise and WMS system, VISUAL Distribution
, complete with Teklogix radio frequency (RF) scanners and light assembly functionality.
I asked Woldenberg what prompted the new system. "We had been using a Lilly ERP system, VISUAL Manufacturing
, since 1996, but its new system is different," he explained. When the company examined its software options, it discovered Lilly Software was the only vendor to offer an integrated, scalable ERP and WMS solution to accommodate the company's make-to-stock environment. "It handles the flow of information for order management, warehousing, product design, and manufacturing. It is a more holistic approach to the way we operate our business, and that's why we wanted to do it."
Woldenberg discussed more specific problems that prompted the upgrade. Due to its success and increasing business volumes, Learning Resources required more expansive functionality and more data management capabilities. Additionally, the company lacked a WMS. It had a number of inventory-related issues, including excessive amounts of claims and inventory inaccuracy. It needed to decrease turnaround time for orders, and accurately track order entry information from a variety of inputs, including the Internet. Overall, a number of problems conspired to keep the company from the growth and competitiveness it wanted. The only way the company expected to meet its goals was by seamlessly integrating its business processes. Those expectations lead to the Lilly Software installation.
ERP/WMS Installation: Growing Pains
Typically, Learning Resources runs a one-shift operation. During the final stages of the installation, however, the company ran two shifts from time to time and was supported by a staff of technicians from Lilly Software Associates. I asked Woldenberg to describe the difficulties of such an installation. "The frustrating thing with an ERP installation is that if things go wrong, they go wrong for everyone at once. You're dealing with a system that operates your business as a whole, so an error in one component will inevitably cause problems elsewhere. It can be unpleasant, but you have to expect it. To make the installation a success, you need to have a strong commitment, not only to the success of the installation, but also to the vendor. Find a vendor that is committed to you and your business, and put your best people on the project. An installation like this one is not to be undertaken lightly. Having the right strategy and partners can make all the difference." Lilly Software worked with Learning Resources before the company went live using Oracle and NT applications in May 1999.
Installation Benefits: Worth the Wait
After going live with VISUAL Distribution
, Learning Resources began to notice a number of improvements, including an increase in its ability to get orders out the door. "We're shipping better than we've ever shipped," said Woldenberg. "Our picks per hour and per man have increased, and we're continuing to see improvements in those numbers. Compared with figures before the installation, we're now tracking at about twice the productivity per pick. We definitely see savings associated with these improvements."
The new WMS system has changed processes at Learning Resources. Because the company serves a wide variety of customers from retail to consumer, it ships orders by the piece, by the box, and by the pallet. Before implementation, the company reserved special days for different orders, depending on their size. Now, with the integrated enterprise/WMS system, the company can handle big and small orders simultaneously, with far less disruption in flow.
Since the implementation, Learning Resources also maintains better accountability for work order information. The RF devices allow the company to view the completion status of jobs and monitor employee productivity. By using the scanners to track jobs, the company has created a paperless environment and has enabled employees to decrease data entry time, increase accuracy, and finish orders. This allows it to improve labor planning and optimize operations in its warehouse. "We can track the productivity of our employees by user and by activity code. We're starting to use this knowledge to make decisions about running our business," said Woldenberg.
Technological Philosophy: Defining Your Needs
It became apparent to me that Learning Resources' business processes relied heavily on technology. So I asked Woldenberg for his philosophy on technology. "You know," he responded, "our business is not the business of installing technology. We make educational products. We want the technology to work beautifully in the background, so we can make toys." Woldenberg went on to describe technology's role in relation to Learning Resources' customers. "Above all other things, we are in business to give customers what they need. This new system helps us do that and do it better than we did before. When you measure the system's success by that standard, you realize that any growing pains associated with such an installation are well worth the results."
Technology Installations And Universal Truths
Learning Resources continues to use VISUAL Distribution
to improve information visibility, decision making, and labor planning. But, as the company continues to improve its processes and decrease turnaround time and costs, its focus still remains on customers.
To successfully implement any manufacturing or distribution system, companies need a good relationship with their software vendors, an abundance of energy and teamwork, and the patience to overcome typical installation complications. But as Woldenberg described, technology is not an end in itself. End users who carry out cutting-edge installations aren't necessarily more competitive. Many miss the point that technology is a tool that should enable your business, not define it. Realize your technology installation for what it's worth, and you'll be one step closer to making it a successful one.
Questions about this article? E-mail the author at DougC@corrypub.com.