Think Bigger
Monarch automation operates like the big guys by using high technology on a smaller scale
By Victoria Fraza -- Industrial Distribution, 4/1/1998
Some key topics of conversation among distributors these days are integrated supply, the problem of hiring and keeping good people, supplier relations, and the advent of new technology. While Lee Anderson of Monarch Automation has much to contribute on all of those subjects, technology is probably the topic most near and dear to his heart -- and the factor that differentiates his small company from many of its competitors.With a Web site and company intranet in the works, full EDI capabilities, electronic catalogs, and a fully integrated company-wide computer network, this $3 million firm may seem a bit ahead of its time. But Anderson says Monarch Automation -- a West Chester, Ohio firm that distributes pneumatic, electronic and motion control equipment in southern Ohio and central Kentucky -- is just doing what it needs to do to compete in today's market.
"We've got to be as capable or more capable than the next guy,'' he says. "What we try to do is be able to do the same things a Grainger can do...so, in a sense, without too much money, we can act like they do."
Well, with one big exception -- more convenient service. If you're working with a large firm, Anderson explains, and need to see a specialist that day, you'll be out of luck if that specialist happens to be in another city. That's not the case when dealing with a local company like Monarch Automation. By the same token, if a customer wants to order via fax, e-mail or EDI Anderson believes he should be able to do that with a smaller company just as easily as he can with a large one. That kind of reasoning has kept Monarch Automation on the cutting edge of information systems -- both internally and externally.
In mid-1997, Monarch Automation developed a file server network to connect all employees via computer. Today, through an Internet provider, salespeople can log on to the Monarch network to check e-mail, faxes and soon, their voicemail messages. Sellers can also do their call reports on the network and download up-to-the-minute information for customers --the latest version of a catalog or CAD drawing, for example.
"Rather than search through [traditional] catalogs," says Anderson, "we can fax or e-mail them the latest catalog -- all from the network.''
The Monarch Automation Web site is still under construction, but upon completion customers will be able to link to some of the company's major suppliers. Anderson says he doesn't think he will use the Internet for ordering purposes, but adds that there are other technological ways of ordering that the company is taking advantage of. For instance, Monarch Automation has used EDI for two years and has seen major increases in credit card orders since making that an option a year ago.
When one of its major customers came to Monarch and asked to use American Express for all purchases under $1,000, Anderson was skeptical. But the situation worked out so well, today three to five percent of the company's business is done via Mastercard, Visa and AMEX. Anderson anticipates that number will rise to 10 to 15 percent by 1999.
On the other side of the issue, Monarch Automation is online with its major supplier. The arrangement enables Monarch employees to place and expedite their own orders with that supplier and track those orders over the Internet via UPS.
"Our goal is to do business electronically," says Anderson. "It can't or won't all be done that way, but our goal is to take care of the customer's need."
And that goal requires adaptability. A case in point: one of Monarch Automation's customers prefers that purchase orders and quotes be entered into an Excel spreadsheet. Until recently, the customer would print out the sheet and send it to Monarch where employees would fill in the information and then fax the sheet back to the customer. To save paper, time and effort, Anderson and his colleagues had a better idea -- transfer the file back and forth over the Internet. Other customers have their personal ordering and shipping preferences as well -- and Anderson says his company does its best to accommodate them all.
"One customer wants all orders shipped on Friday," Anderson explains. "Another one wants everything sub-assembled with one part number. The customer is demanding more and they generally want one- to two-day turnaround."
Using the right technology can help in that effort by reducing redundancies and increasing productivity. While it isn't easy for any company to stay on top of that technology today, it's often toughest for small companies that lack the money and personnel to invest in it. What's helped Monarch Automation is having one person dedicated to the development and upkeep of all systems.
That doesn't take the burden off the company's other nine employees, however. Anderson explains that everyone at Monarch has an area of expertise -- for instance, one person is knowledgeable on the ACT system (a contact management program used by many salespeople), while another person knows Excel inside and out. Everyone at Monarch Automation has to wear many hats. Indeed, even the information system manager has another job -- she is the accounting manager as well.
"We all have working knowledge of [the system]," says Anderson. "We've kind of broken it down to where we have one person that manages everything and then others that know specific programs well."
And that knowledge has only helped the company from a customer service standpoint. Monarch Automation's technological advances on the inside have created a seamless connection with customers on the outside. A case in point is Gary Clemenz, electronic controls manager at Globe Products in Dayton, Ohio.
Although he knows technology is an important part of Monarch's business, Clemenz says it is not what makes him a loyal customer. What matters most to Clemenz are the quality products, service, quick response time, and the tremendous product knowledge he gets from Anderson's company. While all that has been in place for years, new technology enables it all to be done more efficiently -- and that's what matters most to the customer.
"We have a job to do and when a sales organization fits that bill or fills that need and is genuinely concerned about us -- and if they work hard for you -- that's what we're really after,'' Clemenz explains. "Whether it's a large company or a small company, it really doesn't matter. Lee's company works hard to solve our problems." I
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