IFS ERP investment underlies port firm’s growth

Case study

IFS ERP investment underlies port firm’s growth

For more than half a century North East England has been beset by industrial decline. But in 2010 the UK government announced £75bn investment in offshore wind in the North Sea. Suddenly, for companies supporting industry in the area, there was an opportunity to reverse the slide.

For PD Ports, which runs ports in Teeside, Hartlepool, Hull, Immingham and Felixstowe, capitalising on opportunities like this means getting an integrated view of the business.

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“The IT function was segregated into a different division: every local business had its own IT solution," says Marco van den Bremer-Hornsby, IT director at PD Ports. "We did not really have a proper ERP system.”

PD Ports, which boasts £129m turnover, saw its traditional markets in chemicals and heavy industry were dwindling. To grow, it diversified to support the retail sector, and renewable energy, with a package including port services, road transport and warehousing.

It needed a new enterprise resource planning system to integrate these different functions, says van den Bremer-Hornsby.

PD Ports opted for IFS, middleware from Aurea (technology formerly offered by Progress Software), middleware from Microsoft, and a best-of-breed warehouse management software system, JDA Dispatcher, formerly known as Red Prairie Dispatcher. The combination was selected because of IFS’s strengths in asset management and projects management, says van den Bremer-Hornsby.

A big bang implementation, using an external service provider, would not improve organisational capability as the software went live, says van den Bremer-Hornsby. Instead, the IT team opted for a module-by-module, department-by-department approach, using external help on a piecemeal basis.

But the business units needed to understand the importance of the project, and their own processes, to the whole organisation, he says. “Previously every function bought systems for their use only. Nobody spoke across borders.

“We never really understood the concept of process thinking. We were a very physical organisation: things happened outside on the docks and trucks. Administrative processes demand you look at them with different techniques than the physical. We needed other techniques for that,” van den Bremer-Hornsby says.

Success starts with failure

Introducing the first module to HR, van den Bremer-Hornsby was happy to see this effort fail to learn a valuable lesson.

“It demonstrated that, by treating this as IT – and implemented as maintenance – it would not deliver any value to human resources (HR)," says van den Bremer-Hornsby. "That gave the understanding that we needed to treat these as business projects, not as IT projects. Then the business bought into process mapping. Now they are doing projects where they restructure their departments because of these exercises, without talking about IT,” says van den Bremer-Hornsby.

Now all departments have modules supporting HR, finance, procurement and engineering maintenance, where the business teams own functionality and are responsible for data quality and business intelligence.

Having completed these back office functions, the integrated system is now being developed to manage sales orders across ports, transport and warehousing.

Meanwhile, central visibility of sales supports a resource schedule for each order, from arrival at port terminal to transport to a warehouse. These activities had been locally optimised, but with a group-wide system, they work together, van den Bremer-Hornsby says.

“If a ship comes in late, then we can reschedule the workforce for the terminal and also trucks, drivers and the warehouse," says Bremer-Hornsby. "We can bump up all the services through the chain so no one is waiting. There is less wasted resources and assets.”

The goal is to integrate back office and sales solutions with the best of breed systems which run ports, warehouses and transportation using messaging and an enterprise service bus.

In this way, engineering and warehouse systems can work together to optimise use and maintenance of equipment so each plant achieves higher availably and engineers have the capacity to service more equipment at no extra cost as the business grows.

Van den Bremer-Hornsby expects the sales system to be in use by the end of the year. Back office and front office IFS systems will be integrated with specialist systems around the same time.

The project has doubled IT’s external expenditure and is costing several million pounds each year, although van den Bremer-Hornsby does not offer an exact figure. It includes new infrastructure, SANs and a datacentre. Now around 15 business services staff in the 30-strong IT department are dedicated to the project.

It is a colossal effort for a small IT team, but for Van den Bremer-Hornsby the investment is essential to allow PD Ports to work more efficiently and reach beyond its traditional, shrinking markets.


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This was first published in May 2014

 

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