Cloud transformation sparks innovation and enterprise agility for NHP Electrical Engineering Products
NHP Electrical Engineering Products offers 100,000 line items, serves 13,000 customers, operates around 25 branches in Australia and New Zealand, and has a staff of around 850. It’s a complex business where all the moving parts have to be orchestrated perfectly.
A cornerstone of the business is managing the engagement with customers. The company had been using Dynamics AX, to good effect initially, but over time the integration of the on-premise system with NHP’s diverse collection of other business systems, the lack of mobile access, and difficulties associated with a need to scale rapidly became an issue for the company.
NHP IT manager Robbie Attard says that the company’s first priority with its digital transformation plan was to support sales reps who were out on the road and had struggled to get the information they needed to meet customer needs. “To be more efficient NHP needed a system that gave us a 360-degree view of the customer and guaranteed that the information reps saw was accurate and timely.”
He was also keenly aware that a modern, cloud-based platform would also streamline IT management; Attard states:
NHP started its transformation in 2016 with Dynamics 365 Sales as the first workload moved to the cloud to deliver the mobility and insight that sales personnel needed. This served as an important first step towards the far more comprehensive digital transformation that Attard has steered.
Today the organisation uses the full ERP suite – Dynamics 365 Finance and Operations, Dynamics 365 Supply Chain Management and Dynamics 365 Commerce. As Attard says; “You name it, we’re using it.”
Progress not perfection
Attard is a pragmatist. He tackled the digital transformation of sales first, then swiftly moved onto finance and operations with Supply Chain and Advanced Warehousing to follow. Stressing the “progress not perfection” approach, Attard has used this approach to accelerate the speed to deliver business outcomes and then continuously enhance the solution to maximise impact.
This allowed NHP to deploy the sales functionality first, then swiftly add finance and operations – rather than wait for each to be perfected which might have delayed the business impact.
Key to the transformation was NHP’s decision to move its information systems to the cloud. It deployed Office 365 then Dynamics 365. The approach promised the integration, strategic decision making support and flexibility that NHP needed – and also presented a clear future technology roadmap of opportunities for the business.
Key to the success of the transformation has been NHP’s transition to a more agile way of working.
Attard has a team of 25 people, most of whom have now completed training courses in Agile. “Coming from a very heavily customised system, moving to cloud and an out of the box solution, we had to do that and get everyone’s mindset heading that way.”
This agile approach meant that when NHP deployed Dynamics 365 Finance and Operations it shifted off a heavily customised AX system to the out-of-the-box functionality of Dynamics 365. While the customisation of AX rendered it pretty static, there have been eight upgrades achieved for the Dynamics 365 platform since it was first deployed, reflecting Attard’s commitment to continuous improvement.
A key decision that Attard took early was to avoid customisation as much as possible and use Dynamics 365 as close to ‘out of the box’ as possible. That has made the entire organisation more agile and adaptive to change, he says. “Especially over the last six months, that certainly helped us as we made a heap of change, heap of process change, and Dynamics 365 has helped us facilitate that.”
In the case of Dynamics 365 Rollouts, where NHP worked with Microsoft partner, DXC, Attard says; “We broke the project down and tried to stick with out-of-the-box functionality were possible. We focussed on the key things such as activity tracking and opportunity logging. That approach meant we completed the initial rollout to the sales team within four months.”
NHP was supported throughout by its Microsoft Customer Success Manager and the product and engineering team to accelerate project deployment and drive employee adoption for Dynamics 365 across the organisation.
That included migrating the data from the Dynamics AX platform across to Dynamics 365 Finance and Operations and ensuring the sales reps were trained and ready to use the system from day one.
With the first Dynamics 365 module deployed, NHP was ready to continue its transformation, consolidating and rationalising its application set and streamlining operations.
Instead of NHP’s previous waterfall approach to platform upgrades that could take months to complete, Attard and his team can now handle a release upgrade in a week, he says.
“We’ve taken on some of the new functions and features that have come with those releases as well.
For example, materials requirement planning and demand forecasting was previously tackled by a third-party tool. That is now handled with Dynamics 365 says Attard; “So now we can make decisions a lot quicker and have a bit more faith in the data that it’s showing us. And that’s right the way through the whole supply chain.”
While Dynamics 365 has helped to make the business more responsive, the move to the cloud has also transformed the IT landscape at NHP.
Before adopting Dynamics 365 the company had around 150 servers in a private data centre that it had to operate and manage. It now has sliced that to around 20 servers.
Now says Attard; “Our mantra is; Azure first. All of our BI and analytics, virtual machines and PaaS and SaaS service offerings are all sitting in the Azure Cloud.”
Having moved to a cloud model also facilitated the company’s transition to remote work for many of its workforce when the COVID-19 pandemic struck.
A thornier challenge that the pandemic prompted was managing the supply chain as most of the equipment that NHP sells is imported, and the company was facing extended lead times on orders. “But Dynamics 365 gave us the ability to forecast and plan with changing lead times and service levels that the suppliers could offer us,” says Attard.
The next major program of work for NHP will be enhancing their customers online digital experience and also around Advanced Warehousing in Dynamics 365 Supply Chain. NHP operates a number of warehouses around Australia with a main distribution centre in Laverton, a suburb in Melbourne’s west. That facility handles around 80 per cent of the company’s distribution and currently uses a third-party picking system that ingests order information and facilitates the picking – but it’s still a paper-heavy process.
Attard is now trialling Advanced Warehousing in Dynamics 365 Supply Chain in order to automate the picking and make the process paperless. “We’ve turned half of Laverton on now. We’re slowly but surely working through that, to be more system driven. We’re going to allow Dynamics 365 to actually control everything from a system perspective and try to eliminate all of the paper – from inbound all the way through to outbound as well.”
He says that benefits are already evident. ”Even simple things like managing first in, first out stock, it had to be done manually.
“Right now, we get about 2,000 orders a day and the expectation is that they’re delivered or they’re dispatched the same day out of the warehouses – providing we’ve got the stock and they pass credit,” says Attard. He credits Advanced Warehousing in Dynamics 365 Supply Chain with ensuring a more consistent customer experience – and also opens the door to customer track and trace, which NHP has not been able to offer in the past.
The company also deployed Power BI to support strategic decision making across the organisation including the sales representatives’ reporting requirements, helping to streamline workflows and processes.
With robust digital foundations across the enterprise NHP is now considering what other technologies could be deployed, including AI and machine learning, says Attard. ”We are using some machine learning. We’re using the demand forecasting solution today. So we’re using and have tweaked our machine learning module to help us do our demand forecasting better, we have also introduced Azure BOTs onto our website to assist the customer to quickly check product availability and order status directly from D365”
He believes that in the future it will be possible to use machine learning to get a better understanding of customer needs – ultimately to anticipate the sorts of products and services that they will need – more confident than ever of NHP’s ability to deliver.