• September 1, 2005
  • By Marshall Lager, founder and managing principal, Third Idea Consulting; contributor, CRM magazine

A Prescription for Ricohvery

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Acquisitions can bathe a company in the sunny glow of merger fever, but that ignores the deeper symptoms of confusion and reduced efficiency as the merged businesses try to fit themselves together. Ricoh Business Systems (RBS), a subsidiary and direct product provider of Ricoh Company, caught this corporate illness back in 2002, when it tripled its sales force and inventory as the result of two major operational changes. "We had just purchased a large dealership and merged with another Ricoh division," recalls Mike Nelson, general manager of sales at Ricoh Corp. "We added two offices in the process, for a total of five Philadelphia-area locations and 57 sales reps." The expansion gave Ricoh a much stronger presence in the regional marketplace, but it also meant that personnel was using a mix of data management systems with little or no integration. Just prior to the acquisitions RBS had turned to ACT! as its sales management solution, but that wasn't the case with the new additions. Forcing the disparate operations together led to data synchronization hiccups, increased manual data entry, and attendant security concerns. Ricoh prospered despite the problems of merging operations, and upgraded to ACT! 2005 when it became available, contracting Bob Purdy, owner of Automated Sales, the local ACT! Certified Consultant. The newer, more powerful version of the venerable contact manager--cum-SFA application unified the company's approach, but it didn't solve the issue of scalable synchronization. ACT! is designed for installations of 50 licenses or so, which meant that Ricoh was pushing the limits of the software. "The amount of synch needed to keep all our data fresh in ACT! would have been impossible," Nelson says, so he turned to Purdy for further remediation. "Bob had been suggesting WiredContact for a number of years." WiredContact, the Web-data wrangling application, expands ACT!'s functionality by increasing the number of users it can handle, updating changes to the ACT! database in real time, and adding functions like document sharing, interactive sales reports, and personalized HTML email blasts. Purdy first implemented WiredContact for Ricoh in January 2004; he went one better in June of that year by linking WiredContact to Ricoh's Microsoft Access warehouse inventory database. The result was a transformation of Ricoh's business processes by reducing wasted time. Sales opportunities have become easier to track and develop because of the automated processes, allowing sales agents to spend more time working with their customers. Where the agents had each been spending a minimum of four hours a week on manual sales info entry, they now spend 75 percent less time, just an hour or less--sometimes none at all, because the information is up to date, reliable, and laid out in report formats for management. The automatic report generation in turn saves Nelson the time and trouble of waiting for accurate forecast data. Nelson notes that he gained five hours a week, glad to have less hassle and more productivity. The WiredContact-ACT! implementation was intended for the sales team, but the medicinal effect has grown beyond that department. The telemarketing team is also on the system, and its improved ability to track opportunities and focus on current data has turned into a 3 percent increase in new business with the WiredContact implementation. The success of the integration has inspired Nelson to use the system as an overall organizational tool; supply and accounts receivable will be the next stops on the integration road map. Nelson also saw improvements on the back end once WiredContact was integrated with Access: The inventory "days on hand" measurement decreased 30 percent, from a month of inventory on hand to just 20 days, below the company benchmark. "That 30 percent decrease translates into reduced costs in interest, insurance, and balance sheet inventory," Nelson says--now that's healthy. The Payoff By adding WiredContact to its ACT! system, Ricoh:
  • saved each salesperson more than 16 hours a month in data-entry time;
  • reduced on-hand inventory requirements 30 percent, from 31 days to 20;
  • bought the general sales manager 5 more hours of personal productivity per week; and
  • extended the system's benefits to the telemarketing team and the warehouse.
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