MARKET | Sep 23, 2016

Is data necessary for better production? The Dellas case

Interview to Marco Pasquotti, Chief Financial Officer of Dellas, about the link between business contingency and profitability and data management through ERP

When does a company embrace digital transformation? Maybe when it realizes that the traditional method of data management, sometimes even entrusted to the historical memory of a few, is no longer sufficient to ensure international competitiveness. This is what happened to Dellas; producer and distributor of diamond tools (discs, blades and wires for cutting marble and granite), which in 2009 introduced its own ERP system with the aim of supporting the internationalization of the business and managerial reorganization.

Pasquotti

“The Microsoft Dynamics AX solution – says Marco Pasquotti, Chief Financial Officer of Dellas, came at exactly the time when Dellas needed to expand its Group with subsidiaries in countries such as Turkey and China, where the administrative-accounting flows are different from those in Italy. With this step the company had the opportunity to finalize its transformation towards lean production, globally share data and transactions and give customers and retailers the ability to configure the product through a Web portal.”

Dellas, “class of 1973” immediately encountered multiple benefits, from the introduction of a “digital” way of managing business operations (such as manufacturing, financial management, orders and supply) to simplifying the working environment, operational streamlining, improving analyses and management control. Fundamental elements for a company with a global presence and a network of 35 subsidiaries and distributors in countries such as Brazil, China, Ethiopia, India, Spain, Thailand and Turkey.

“The ERP Dynamics AX – continues Pasquotti – aided the development of strategies that are constantly evolving, like the system that we will continue to evolve, adapting it to new situations.” Moreover there can be no global management of a company without shared management of information and greater versatility in the management of goods and data between branches. One of the requirements of Dellas for example was to improve forecasting functionalities in order to make the purchasing procedures and long-term planning more reliable and convenient, in particular for the management of contracts governing raw materials, which are valid for at least a year. In this case some managers were still making certain calculations outside of the system, with the possibility of error and an exaggerated investment of time compared to information that today arrives automatically directly from the system.

Dellas, with the support of MHT, has joined the Microsoft Technical Adoption Program (TAP), the Microsoft Dynamics AX 2012 launch program – becoming the first Italian company to have implemented this solution.

But what did the journey to lean organization involve?

It started in 2009 with an analysis of all business process flows in order to reorganize certain production departments; it subsequently moved to implementation of the lean culture via a review of the reordering process for high-turnover raw materials. The objectives were to reduce the time  needed to process purchase orders, reduce stockpiling while at the same time eliminating errors in the planning or inventory phases in order to reduce the possibility of stock shortages to a minimum. “The introduction of lean methodology – states Pasquotti – has increased our productive efficiency, in addition to decreasing cross-sector processing time”.

The ERP Microsoft Dynamics AX system also integrates with the production machinery, such as automatic scales, cold presses, sinterizers and a laser printing machine. This means that the ERP system can automatically calculate and record details relating to material consumption in production orders.

But how important is data within a production company?

“Data – concludes Pasquotti – is increasingly more important. In the past, higher margins and minimal competitiveness facilitated the opinion that good sense was sufficient to successfully manage a company. Today it is no longer that way. Data has become cheaper to obtain than in the past: it is now easier to retrieve and analyze. Thanks to this data we can take important decisions such as whether to produce or not, sell or not sell, comparing costs to the cent. We can be certain that our data is correct because we have invested in it and received a significant return as a result.”

Sonia Montegiove