Starting Over

Starting Over
In 2000, Cooper was left with the right idea but the wrong technology.

The Red Brick warehouse was helping to store and integrate the data, but it wasn't having a measurable impact on the business users. IT employees and research analysts still had to run the reports, rather than the business execs themselves, a process that took days and sometimes weeks.

So without Daly to articulate TLS's ongoing needs, Cooper turned to a now-familiar formula: She went back to the business executives.

"I actually hosted a debate by two business users," she says.

"There was someone from the finance department who was a real advocate of Essbase [a business-intelligence platform from Hyperion] and someone who was a real Red Brick advocate. I put them in a conference room to decide whether we should standardize on one or the other, and what were the trade-offs and differences between them."

Cooper remembers being surprised at the passion the two business execs brought to the table, and at how both had grown so attached to their respective systems that neither could imagine doing their jobs without them.

Cooper decided to go with an Oracle database and the Essbase software, a product now folded into the Hyperion business-intelligence platform, and the company immediately started seeing results.

Mike Burkes came on board in 2001 as the data-tech manager in the enterprise data-management group—a position that was created specifically for him. He had been working as an outside consultant to Toyota before joining the company, and calls Bob Daly the "visionary" behind the business-intelligence operation that Burkes now runs.

But it wasn't until the company made the switch to Oracle and Hyperion in 2000 that Daly's vision finally became a reality.

In one day, an analyst found that Toyota was getting billed twice for rail shipments of vehicles out of a particular rail yard. The problem was that the railcars were being scanned twice—an honest mistake—but up until that point, Toyota execs had no way to drill down and discover the duplicate entries.

The new information saved the company $800,000 "overnight," Burkes says. "The analyst who caught the error won an award."

The difference between the old system and the Hyperion system, according to Burkes, is the ability to use a dashboard feature that allows executives to see hot spots in their business units and investigate further to identify the problem.

The dashboard works like a simple stoplight, with lights that display green (good), yellow (acceptable) and red (danger).

A business manager can see, for example, when delivery times are slowing to unacceptable levels and immediately try to find the source of the problem. The gauges can be programmed for a variety of data sets, including accessory revenues, order management and expenses.

The results have been eye-popping.

IDC conducted an independent study of the Oracle/Hyperion implementation at Toyota Logistic Services as part of a broader study the research firm was doing on business performance management.

Their conclusion: Toyota had achieved a 506 percent return on the software. (The reason the ROI is so dramatic, however, is that the historical data the new system made available allowed TLS to identify a port in Baltimore that it no longer needed. The closing of that port resulted in the bulk of the ROI. Still, the median ROI for the 43 other Fortune 500 companies that participated in the study was 112 percent.)

Of course, to achieve that kind of return, there had to be some pretty severe inefficiencies in the business to begin with.

"Suffice it to say we were overspending," says Burkes, adding that the transparency the new data gives the company allowed TLS to take much of that inefficiency out.

This article was originally published on 10-01-2004
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