Simplify Your Materials Management Process

A key to success in any business is to understand the future needs of one’s customers and to be the first to meet those needs in an effective and efficient manner. In 2005, Gibson Electric Membership Cooperative (GEMC) in northwest Tennessee began utilizing an Irby service called Remote Data Collection (RDC) to streamline their material procurement and management processes.

The Situation

GEMC is an electric distribution cooperative serving northwest Tennessee with four local customer service centers, each containing a warehouse. In June of 2005, the local Irby Salesman, Travis Lewis, approached Charles Phillips with GEMC to discuss the possibility of using RDC to help Charles achieve his objectives for reducing Gibson’s inventory investment and improving inventory turns. RDC can help customers imporve their performance in three key areas:

Simplified procurement process
Depending on customer preferences, this can be a completely electronic process for purchasing orders.
Improved information accuracy
Correct items and descriptions, correct customer account information, correct quantities, correct pricing, correct purchase order numbers, correct shipping addresses, correct order dates and anticipated ship dates — with copies immediately on the desk of designated people.
Improved Materials Management
Improved materials availability, reduced inventory investment.

The Process

GEMC’s Alamo location was selected as the first site for implementation of RDC. The set-up process took approximately one week and was coordinated by Travis and the local Irby branch.

As a part of the set-up process, Travis worked with GEMC to develop min/max stocking quantities for each of their items taking into account product lead times, delivery schedules, standard package quantities, purchasing history, cost and other factors.
Stock numbers were assigned to each item that GEMC buys and this number was cross referenced with Irby’s system. This information was built into the RDC database and entered into GEMC’s inventory control and plant accounting software.
Storage bins and locations were labeled and bar-coded.
All setup of the local computer and the PALM® handheld device was coordinated by Irby’s IT specialists.
A two hour training session on its RDC system was conducted with GEMC employees. The RDC ordering process significantly improves information flow and accuracy, and the process is very simple.
A member of the Alamo crew scans the bar code with the PALM® handheld device.
He confirms the material is needed and enters the requested quantity, taking into account the min/max quantities established for that item. This process is repeated for all items that need to be ordered.
After the review of the warehouse inventory is complete, the handheld device is synced with the desktop computer.
Orders are sent to Irby via a secure web link and confirmations are provided to GEMC via return email within minutes. Material is shipped to the Alamo location based on GEMC’s shipping instructions.

The Results

Charles Phillips, Purchasing Agent for GEMC says, “GEMC began using Irby as a sole source provider of utility material more than four years ago with the goal of lowering our total cost of material procurement and inventory. Remote Data Collection is one of the programs that has helped GEMC achieve the lowest warehouse overhead of any electric utility in our area. A low overhead coupled with higher inventory turns means we are achieving our goal. We appreciate the vital role Irby and our Irby salesperson played in helping our Cooperative become more efficient.”

“We consider the Alamo project a complete success and are coordinating with Travis to get RDC going at three of our other customer service centers,” says Phillips. Jeff Newman, Manager of Engineering at Forked Deer Electric Cooperative in Halls, Tennessee also utilizes Irby’s RDC service. “RDC frees me up so that I can keep better track of work orders. The convenience of the process is what I like most,” says Newman.

The End Result

The materials management process is greatly simplified and much more cost effective. RDC is fast, efficient and improves profitability through improved information flow and better inventory management.

To learn more about Irby’s Remote Data Collection, call your local Irby salesperson or log on to www.irby.com/services.