Allied Valve, a supplier of industrial valves, repairs and field services to power and chemical plants, refineries and other industrial installations in the north-central U.S., is a great example of a company that has seized competitive advantage and grown its business by leveraging real-time cloud ERP technology.
The company leapt far ahead of slow-moving competitors as the Bakken oil and gas boom took off in 2012, supplying critical parts and service to energy companies tapping vast reserves in North Dakota and Montana. Working from hotels, trucks and job sites, on-the-ground Allied Valve personnel used NetSuite for inventory management, parts ordering and personnel allocation over iPads connecting over cell tower 3G signals.
With NetSuite, Allied Valve’s mobile service and sales teams had the IT agility and speed to capitalize on a monumental opportunity while competitors were slowly building out systems and buildings in a region that lacked adequate Internet and physical infrastructure to accommodate the huge influx of equipment and personnel of the Bakken boom market.
“NetSuite enabled us to get way ahead of a lot of competitors who were waiting six months to get building permits and facilities built,” said Jodie Schwirtz, CIO at Allied Value, based in Riverdale, Iowa. “We can get to NetSuite anywhere, anytime under any circumstances and that’s a huge advantage.”
By capturing business at the Bakken outset, Allied Valve has sustained its competitive advantage and built trusted relationships with energy customers at work in North Dakota and Montana, extracting more than 1 billion barrels of oil a day as well as natural gas.
Key elements of Allied Valve’s NetSuite solution include:
- Real-time visibility into $3.5 million in inventory across multiple locations
- On-the-spot ordering of parts — for instance, from a customer’s job site trailer
- Unified system to assign and manage personnel from six offices across job sites
- Better service and more collaborative and profitable relationships with customers
- Shop-floor control over manufacturing, assembly and repair processes
- Efficient automation of processes to secure and execute service agreements for scheduled maintenance of customer equipment
- Single system to track personnel hours, expenses, equipment and more
- On-demand processing of sales and purchase orders
- Integrated CRM for instant visibility into customer accounts
- Anywhere, anytime access over laptops or tablets
Allied Valve’s growing business in the Bakken energy market builds on the success it has realized since going live on NetSuite in 2004. Since then, NetSuite has helped Allied Valve:
- Reduce inventory by $1 million, or roughly 30 percent
- Achieve steady double-digit revenue growth and expand the customer base
- Expand from three to six locations in Iowa, Illinois, Indiana, Minnesota, North Dakota and Wisconsin
- Grow the workforce 400 percent to more than 100 professionals, without new IT staff
Recently, the integration of NetSuite’s customer asset tracking system is enabling Allied Valve to eliminate $30,000 a year in IT expenses — $25,000 to a third-party vendor that maintained servers for the company, and $5,000 to third-party IT consultants. NetSuite flexibility has enabled Allied Valve to efficiently run three lines of business from a single, integrated system:
- Sales of new valves from two major manufacturers
- Expert valve repair, refurbishment and custom assembly
- Field service including 24/7 emergency response
Better Service and Collaborative Customer Relationships
Cloud ERP also enables Allied Valve to build more collaborative and profitable relationships with customers and enhance service levels. “Using NetSuite to create partnerships with our customers is going to have a huge impact on our business,” said Schwirtz.
For instance, the company strives to help customers avoid costly outages that could cost a power plant $15,000 an hour by maintaining all customer asset information in NetSuite. In the event of a scheduled or unplanned outage, Allied Valve can swiftly check the last repair status of a valve and check inventory for additional parts that may be needed.
By extending NetSuite to the shop floor, Allied Valve has enabled its technicians to take greater control of customer relationships with documentation, images and data capture. The company is now working towards giving large corporate customers inventory data across a customer’s multiple locations to help them manage stock by placing assets where they are most likely to be needed.
“This of course leads our customers right back to us for their next big project as we already have all of the data on their assets,” Schwirtz said. “But it’s not just on our repair side — all new products that we sell will be maintained in the system as well, allowing us to track replacement and expansion purchases and stock the right replacement parts, which should produce a better inventory for us going forward.”
Cloud infrastructure with strong business functionality was among the key reasons that Allied Valve upgraded from disparate, aging on-premise systems to NetSuite’s unified ERP solution. “We did not want to waste time and money on in-house servers and the IT staff to run them,” Schwirtz said. “We let NetSuite worry about that.”
“NetSuite has allowed us to just grow,” Schwirtz said. “We’ve never run into a problem where we felt we were limited. Reducing inventory by $1 million is something directly attributable to NetSuite because we had no ability to manage inventory in that manner before.”
To read more manufacturing and technology news, sign up for our newsletter. You can also follow Manufacturing Business Technology on Twitter @MBTwebsite.