Bigger Isn't Always Better
Despite unique challenges,
small and medium companies can use their agility and customer
intelligence to beat the big guys.
by Alan Joch, July 2007
It can be challenging for small and medium businesses (SMBs) to compete effectively against large, global rivals. Symmons Industries, a plumbing supplies company, Mobilitie Partners, an investment and asset management company for mobile communications service providers, and Sennheiser electronic GmbH & Co. KG, a designer and manufacturer of audio equipment for recording industry professionals and consumers are three examples of SMBs that are succeeding by focusing on customer intelligence, innovation, and new business processes.
Oracle's JD Edwards EnterpriseOne's Demand-Flow Manufacturing module has helped Symmons reduce order turnaround times to two days down from two weeks. Being a small company has enabled Symmons to quickly alter its manufacturing processes to improve performance and give it a better competitive advantage.
Mobilitie faces similar challenges to continually improve as a service-oriented SMB. Mobilitie uses the comprehensive JD Edwards EnterpriseOne suite of applications to manage the complexities of managing and investing a complicated mix of mobile communications assets. Customers are able to depend on Mobilitie's information systems, so that Mobilitie staff can handle tasks that customers would normally have to hire to support.
Sennheiser electronic GmbH & Co. KG also focuses on business processes to tap into improved efficiencies and to react quickly to changes. The firm depends on JD Edwards EnterpriseOne 8.11 to manage its factories, production facilities, and sales subsidiaries spread around the globe. To further improve profitability, Sennheiser is implementing the
Vendor-Managed Inventory module to enable automatic deliveries from suppliers.
It would be nice if order volumes always matched expectations, but in the real world there's one big stumbling block to forecast accuracy. "Those darn customers always seem to get in the way," quips Al Romanowicz, information systems manager for Symmons Industries, a medium-sized 68-year-old plumbing supplies manufacturer in Braintree, Massachusetts.
If customers behaved predictably, companies like Symmons could easily maintain optimal inventory levels, protect profit margins, and compete more effectively against large, global rivals—what Romanowicz calls the "800-pound gorillas."
SMBs on the Rise
But Symmons and other small and medium businesses (SMBs) are finding ways to achieve success. Symmons is combining its reputation for industry-leading quality with new business processes that shrink order turnaround times from two weeks to two days, far faster than its larger competitors. It accomplishes this by building manufacturing schedules based on actual orders rather than traditional demand forecasts, a strategy that relies on the Demand-Flow Manufacturing module of Oracle's JD Edwards EnterpriseOne. "The best competitive weapon we have is our ability to deliver products in one or two days, when necessary," Romanowicz says. "The strength of being a small company is that we were able to change our manufacturing process so that we could achieve this performance. Oracle's applications enable the efficiencies that companies like ours need to be profitable in a global economy."
Global challenges and the need for innovative solutions aren't unique to manufacturers like Symmons. Service-oriented SMBs face similar challenges. "Having the right applications means everything to us as we continue to grow," says Gary Jabara, founder, president, and CEO of Mobilitie, a 75-person investment and asset management company for mobile communications service providers. "Clients heavily rely on our systems and the open platform, which enable them to save significant operating expenses by allowing our staff to manage what they would normally have to hire to support," Jabara says.
Despite their smaller size, SMBs have business and technology needs as sophisticated as the world's largest enterprises, notes Tony Kender, senior vice president of Oracle's SMB Global Business Unit. "SMBs compete with the big guys, the little guys—everybody. So they face all the problems of enterprises, with the additional challenge of needing to do more with fewer people and less money," he says.
"With Oracle, an SMB can use the best software available—the same software large companies use—but implement it very inexpensively," Kender adds. "It's the best of both worlds for an SMB. Customers can take advantage of Oracle Business Accelerators. This reduces time and cost to implement the system, and they realize benefits faster."
