How do they do IT? A publisher's warehouse and supply chain

Going from a $15 million to $35 million company in 18 months after an acquisition and taking on a 6500sqm warehouse that sends out 150,000 books per week in 7000 cartons to service 1200 orders is, as you can imagine, no small feat.

And then try doing it for four geographies (Australia, New Zealand, Asia and South Africa) with just 14 people while ensuring your IT environment runs without a hitch.

That was the scenario facing Parragon Publishing, a global provider of illustrated non-fiction books.

After purchasing the publishing division of a publicly listed company called Funtastic in 2008, Parragon was faced with the task of integrating operations and looked to deploy a new Express Mailing System (EMS).

"Prior to that we didn't have any warehousing functionality of our own, all of domestic warehousing was done by 3PL," Parragon Publishing finance and operations director, Mark Camiller, explained. "So we didn't really have a heavy requirement for an EMS system that had a lot of functionality. Basically all we needed was a simple accounting system because we didn't do much ourselves. What we did in those days was use SAGE out of the UK."

While its global operations -- headquartered in the UK -- run SAGE, the local arm based in Melbourne decided to evaluate different options.

"The problem became that because we went from a 15 to a $35 million business once we bedded the acquisition down we required local warehousing and 3PL was no longer an economical option. So we needed to expand our EMS functionality," Camiller said.

"We had two simultaneous challenges. One was we needed to set up a warehouse. And we had to expand our EMS functionality because we had never received an order in our own right up to that day -- they all went via 3PL. Our largest three customers are Kmart, Big W and Target, which obviously are all nationally based. So we had no electronic data interchange (EDI) functionality in the past.

"Funtastic used Pronto and a couple of people within the organisation including myself had some experience with it. From an overall beginning to end solution we looked at SAGE and Pronto. Separately we looked at the option of leaving SAGE in the UK as we were but running the EDI on a more warehouse-specific platform. We looked at three and one was Manhattan and then there were two other local products. The end result was we decided in conjunction with the UK the best solution was Pronto."

So an IBM RS/6000 rack-mounted server was deployed to run the Pronto system in the company's South Yarra office with redundancy located in the warehouse in Derrimut.

"We then have file server, email server and our third server that houses our EDI; they are all HP machines," he added.

While one might expect some push back from the HQ of a global company when one of its regional offices asks to go it alone with their IT, Camiller was aided by a concurrent deployment across all of Parragon's locations of business intelligence solution, Kronos 8.

"That project has been going for 18 months and is almost finished. So there wasn't a major problem come March 2009 because the decision was made to go the Konros 8 route and it could handle multiple data sources in the one data warehouse," he noted.

Now all global Parragon offices hook into the BI system and thus the potential issue of one regional office having a different platform was avoided.

The Pronto system has also provided an automated data synch with the publisher's carton carrier, Star Track Express.

"In terms of communicating with them all of the manifest details are built and stored in Pronto and sent fully electronically, daily to our carton carrier and loaded into their system," he said. "This gives us immediate point of delivery and tracking information."

Customers also have access and can see where their delivery is through Star Track's site or by a call to Parragon. Additionally, the company offers a free on board (FOB) service where it ships directly from the printers to customers.

While the Pronto solution has helped significantly, Camiller said, the company still needs to employ its own programmer to writer modules for digitising documentation required by offshore clients in Asia.

"In our world, dealing with retailers like Kmart and Big W for example, they send a weekly product activity data report and it's a lot of data we need to format into a readable, usable sense because they tell us what they sold last week and what they have on order or on stock," he explained. "If you are in our business, you live and die by that. Pronto out of the box cannot handle that. I've never seen a solution out of the box that can handle it but our 4GL guy wrote a nice chunky module that sits in Pronto that does all of it. So we bring it in like an EDI order. Then Pronto does all the work for us to generate the weekly reports in a format that even our bottom-end sales people can understand. Otherwise we would have to use a bureau to do that and it would cost."

This story, "How do they do IT? A publisher's warehouse and supply chain" was originally published by Computerworld Australia.

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