In-Depth

Hillman Group

ADT Magazine Innovator Awards 2006

Hillman Group Submission

Part I.

a. Company name Hillman Group
c. Product Designation

Business Intelligence Software

d. Project goals

Founded in 1964, The Hillman Group is a market leader in distributing hardware, letters, numbers, and signs; keys and accessories; and engraving technologies. Based in Cincinnati, Ohio, The Hillman group currently services over 30,000 retail locations in 58 countries. The Hillman Group is a state-of-the-art distributing company with thirteen distribution centers located throughout the United States and Canada. The Hillman Group employs the largest factory direct sales force in the hardware industry today.


In 2004 Hillman was in an aggressive growth mode, making acquisitions and pushing their way towards a leadership position in the market. However the CEO of Hillman recognized that his company needed to invest in technology in order to continue on their rapid growth path. Based on a CIO candidate’s stellar reputation within the industry for taking companies to the next level of operating success through strategic IT investments, he was sought out by the CEO to lead the charge for Hillman. When he arrived he saw first hand how the company was not in tune with technology. Executives had teenagers at home using the internet and instant messaging, but they themselves were letting the technology revolution pass them by! He surveyed the situation and recognized that he and his team were tasked with reinventing the entire IT landscape at Hillman. He presented a vision and an implementation plan that called for four parallel efforts designed to leverage technology for competitive advantage. The plan involved implementing an ERP system, a corporate portal, a collaboration suite (which included e-mail, calendar, instant messaging and web conferencing) and an executive dashboard based upon a new business intelligence tool. The dashboard would also serve as the "killer app" for the company’s new portal providing Hillman executives with accurate decision making capabilities.

e. Business risks

By conducting a complete IT overhaul, Hillman was banking on full user adoption of the system. If the project failed to deliver on what users needed, IT investments and employee productivity would be lost. On the other hand, if Hillman did not innovate, they would loose their competitive edge in the market and risk business failure.

f. How the system helped users

Today, Hillman employs over 1800 people in North America. The CIO and his staff are responsible for supporting over 1100 individuals with various IT initiatives. From email to ERP, portals to executive reporting, each employee, classified as the quintessential "non-technical user" requires a different set of information and skills for a range of different applications. The business intelligence system in particular was implemented to provide the executive team with a more accurate and a more timely view of their business operations. Other collaboration tools were used to enhance overall productivity of users.


Part II

a. Short term and long term benefits

In short, the result has been a change in Hillman’s corporate culture. Technology is a part of the company’s daily life and is an integral part of the organization’s future. Collaboration has improved productivity, employee satisfaction and bottom line results. From executive to frontline worker, Hillman is now empowered with accurate business information and is poised to become the premiere player in its market.


Thanks to the strategic implementation of the executive dashboard via WebFOCUS from Information Builders, executives are able to view consolidated information much more quickly. Operational data is now refreshed multiple times a day, improving latency issues up to 83 percent. Users are able to access the reports over the Internet from any browser. Executives are leveraging operational business intelligence capabilities, accessing information in a context that makes sense to them and incorporating it into their every day lives. There is no need for time intensive queries or analytical processing through OLAP tools, but instead executives can view business metrics in graphic format with critical "drill-down" capabilities at any time anywhere through a secure web browser.


One of the most notable results has been the material impact on freight costs. Previously, Hillman was experiencing unprecedented costs in the transportation of freight, but the company was unable to tell where the escalating prices were coming from and how to fix the problem. With strategic business intelligence solutions from Information Builders, the company now has the ability to quickly analyze, identify and take corrective actions. The result is lower freight costs and improved bottom line.


Most importantly, as the organization grows and changes, WebFOCUS will be able to meet as yet unidentified needs by offering the most scalable and flexible BI solution available to take advantage of new business ventures.

b. Business purpose

The CIO surveyed the situation and recognized that he and his team were tasked with reinventing the entire IT landscape at Hillman. He presented a vision and an implementation plan that called for four parallel efforts designed to leverage technology for competitive advantage. Through his efforts, the CIO shaped the means to put the company on the right track towards achieving their aggressive business goals, but relied on the business experts to determine the content, giving them influence and ownership in the process.


He concluded that the business intelligence solution was the most critical piece of the overall IT strategy in order to meet the business objectives. Hillman was in an aggressive growth mode, making acquisitions and pushing their way towards a leadership position in the market. However, certain fundamental business process changes were required before the new vision could deliver on its promise. For example, a universally agreed upon single definition of gross revenue did not exist – ‘gross revenue’ meant something different depending on whom you talked to – sales, operations or finance. The resolution of such a basic issue was a prerequisite to knowing what steps were required to improve such metrics.


As Hillman looked to grow, accurate information about sales and operations became harder to come by and even harder to attain quickly. For instance, with the previous system, corporate acquisitions added to the complexity of the organization hindering any real progress and benefit from the purchase. When Hillman bought Axxess Technologies in 2000, they acquired the company’s data warehouse as well. The custom-built data warehouse contained data about the letters, signs, numbers and the engraving business. Axxess tracked their business by examining one key performance indicator - how many engraving tags were sold per day. With the fastener product lines accounting for 80 percent of Hillman’s business, data from the Axxess data warehouse provided an incomplete view of how the company was doing. In short, the KPI’s did not match up with the business. Without comprehensive and reliable information on how the entire company was performing, executives had an incomplete picture when making critical business decisions.


The CIO implemented WebFOCUS from Information Builders to create an integrated view of Hillman's operations and finances. The company had four core systems from which data was sourced. These included the new ERP system and three legacy applications. The legacy applications consisted of a propriety application servicing the fastener product lines, a package supporting Mexico and Canada, and a JD Edwards World application supporting the letters, numbers and signs product lines. WebFOCUS was layered on top of all four environments to provide consolidated executive-level reporting and to feed the portal-based dashboard. This approach allowed him to quickly address critical business needs without the heavy lifting of integrating disparate systems.

c. Features

Operational data is now refreshed multiple times a day, improving latency issues up to 83 percent. Users are able to access the reports over the Internet from any browser. Executives are leveraging operational business intelligence capabilities, accessing information in a context that makes sense to them and incorporating it intotheir every day lives. There is no need for time intensive queries or analytical processing through OLAP tools, instead executives can view business metrics in graphic format with critical "drill-down" capabilities at any time anywhere through a secure web browser. In addition, as the organization grows and changes in pace with the market, WebFOCUS will be able to meet its needs by offering the superior flexibility and scalability.

e. Internal sponsors

The CEO was the primary sponsor of this IT overhaul project. It was also important that he secure the support of his IT staff, many of whom had been with the company for nearly 13 years. In order to rally support he leveraged his managerial skills and gave each team member ownership over specific pieces of the larger project, encouraging individual participation as part of the larger group effort.

f. Users involved during planning

The CIO conducted both group meetings and one on one discussions with employees from all functional areas of the company. Through his efforts, the CIO shaped the means to put the company on the right track towards achieving their aggressive business goals, but relied on the business experts to determine the content, giving them influence and ownership in the process. He also maintained contact and provided updates through a corporate IT newsletter to further communicate the project status and success.

g. Greatest challenges

One of the major challenges was to coax the organization to radically change how they viewed their business and the impact of technology. The CIO empowered the IT department, leveraging their history with company to instill a new culture. Instead of outsourcing functions, he streamlined internally, leveraging veteran resources to build consensus and create immediate impact that each employee felt in their day to day operations. The support of the CEO also helped to encourage the shift in mindset. The CIO’s successful management style of addressing the needs and concerns of his peers, his reports and his superiors also contributed to the adoption of the new IT strategy and help to improved business processes within the organization.

h. Did goals change?

Goals remained the same for the project throughout its lifecycle due to the thorough evaluation of the business and IT situation beforehand.


Part III. Category

e-Business Application Development

Part IV:

<>a. Productivity tools

N/A

b. Testing tools

No, software testing tools were not used.

c. Formal or informal software development lifecycle methodology deployed?
d. Formal or informal project management methodologies

The CIO has a wealth of experience in reshaping a company’s IT capabilities and strategy. He believes that ownership is the single largest factor in breeding success. Specifically, his ability to communicate the goals of the project, demonstrate relevance and inspire executives and employees alike to rally around the vision are vital to success. Individuals appreciated their opportunity to give input and have an impact on the decisions being made. After all, if no one adopts the technology, the project can hardly be effective! This was a shift in culture as well for Hillman. The CIO provided an opportunity for people to have visibility with the executive team to demonstrate how they as individuals were impacting the company’s growth.

e. Software quality metrics

N/A


Part V.

a. Technical challenges

The biggest challenge was coordinating the legacy systems which were often custom built. For instance, when Hillman bought Axxess Technologies in 2000, they acquired the company’s data warehouse as well. The custom-built data warehouse contained data about the letters, signs, numbers and the engraving business. Axxes tracked their business by examining one key performance indicator -- how many engraving tags were sold per day. With the fastener product lines accounting for 80 percent of Hillman’s business, data from the Axxess data warehouse provided an incomplete view of how the company was doing. In short, the KPI’s did not match up with the business, hindering the value of the system output. The CIO and his team were challenged to make sense of the home grown systems in place, establish one version of the truth and implement it across the entire organization.

b. What tools were selected and why

WebFOCUS from Information Builders was selected to create an integrated view of Hillman’s operations and finances. Executives are leveraging operational business intelligence capabilities, accessing information in a context that makes sense to them and incorporating it into their every day lives. Information Builders was selected over Business Objects, Cognos, Oracle, and IBM for the ability to deal with rapid change in systems and processes and was able to outperform other BI options based on the products native data access and presentation layer. The software’s ability to deliver user-friendly technology was also critical.

c. Overall system architecture

WebFOCUS for Linux runs on IBM iSeries as part of a Web-centric portal delivery infrastructure, accessing separate data warehouse, ERP, order management, and HR systems. WebFOCUS was layered on top of all four environments to provide consolidated executive-level reporting and to feed the portal-based dashboard. This approach allows him to quickly address critical business needs without the heavy lifting of integrating disparate systems.

d. Characteristics of technologies most important

Scalability and ease of use have been the two most important aspects of the project’s success.


Part VI.

a. Size of development team

N/A

b. Software dev experience

N/A

c. Skill level of team, training required

N/A

d. List team members and titles

The CIO has a combination of directors and managers reporting to him in five distinct areas.

  1. Database services – a manager handles the data warehouse and corporate portal
  2. Application services – a director deals with application development and handles the service desk
  3. Technical services – a manager handles the data center operations and the network operations
  4. ERP system – a team handles this major initiative for the company as Hillman is implementing a web based ERP system to replace a myriad of legacy applications
  5. Electronic Commerce/Systems Services – a manager oversees the transmission of 600,000 kilo-characters of EDI data per month
e. Timeline, did it stay on schedule

The project timeline was aggressive, but stayed on track.

  • Project conceived: January 2005
  • Project started: March 2005
  • Project completed: July 2005
f. Did management and user community consider it a success?

Yes, on all accounts the project has been a rousing success. The entire organization has recognized the improvement in the organization and supports him in his continuing efforts to make Hillman as competitive as possible through the use of technology. Users from all levels have adopted the new technology and are using it to be more productive, helping drive results to the bottom line, fueling Hillman’s growth.

g. Lessons learned

He has implemented three best practices at Hillman:

  1. Ensure IT maps to the business goals – As Chief Information Officer, he reports directly to the CEO, working closely with the executive management team on a daily basis to ensure that the technology decisions are aligned with Hillman’s business goals. This marriage of business and IT has lead to the company’s ability to make smarter business decisions and execute on a growth plan.
  2. Inspire with a sense of ownership - he empowered the IT department, leveraging their history with company to instill a new culture. Instead of outsourcing functions, he streamlined internally, leveraging veteran resources to build consensus and create immediate impact that each employee felt in their day to day operations.
  3. Create adoption through communication – By addressing how specific initiatives will impact employees for the better, He enabled a two way dialogue between the IT department and the user. Speaking with all levels of employees across each function of the organization, hearing each individuals concerns and needs and illustrating how the systems in place would support specific job functions the CIO was able to secure buy in for the critical BI initiative.

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