Japan-based Mitsubishi Motors Corporation (MMC) has manufacturing facilities in over 30 countries and its sales and after-sales organization is present in more than 170 countries. In 2007 the Mitsubishi Pajero won the Dakar Rally for the twelfth time (and seventh time in a row). No car manufacturer has ever beaten this record in the toughest rally on earth.
Mitsubishi operates in Portugal through four independent companies with sales operations for vehicles and spare parts with a working force of about 60 people.
It all started in 1998
In 1998, in addition to the introduction of the Euro, in common with all other countries, Mitsubishi Motors Portugal (MMP) had to cope with expected millennium-related Y2K IT problems. MMP software could not support Y2K changes. The existing software had to go and a search started to locate the best possible replacement.
After examining the full market spread, MMP decided to purchase IBS Enterprise software, ASW. “IBS has the best product for our business,” explains Jose Lança, CFO, Mitsubishi Portugal. “We chose IBS software not only for the product itself but also for the people who would be supporting our implementation.”
The solution from IBS is able to support MMP’s activities in terms of financials, cash management, parts distribution and invoicing.
Changes in the automotive business
During the last few years, the automotive business has suffered severe changes. At the moment, dealers are no longer single-brand but sell multiple brands, which has resulted in manufacturers losing control of the retail network. In addition, the spare parts business is also multi-brand. These changes meant that MMP had to be more competitive; otherwise the company’s margins would come under pressure. It was therefore vital to find new ways to be more competitive to maintain and improve market share.
The company decided to close its Portuguese central spare parts warehouse and rely on a single warehouse located in Spain that supplies parts to Portugal, Spain and southern France. To improve on previous service levels, MMP focused on the logistic parts of the business. “IBS software helps us because it is a very flexible system, and in tandem with the IBS people we made the necessary changes – which were transparent to our customers,” explains João Ramos, IT Manager, MMP. This means that even the dealer who places an order for spare parts doesn’t know their origin – nor does he have to know. Dealers will have access to a far greater spare part inventory than previously.
The installation of IBS software was not seen as an easy task because it was one of the first to be implemented in the Portuguese market. This meant that it was a new product for MMP and a new product for the IBS team supporting the product in Portugal. “But there was good cooperation between our 2 companies,” explains Lança, “and the combined team was able to solve all the problems that occurred.”
MMP is very pleased with its decision to purchase IBS software. After the implementation the company noticed immediately positive changes in its activity. Improvements in task reduction, product integration and staff efficiency all became evident in a short time.
“After the introduction of IBS software the production of reports became easier, additional and more detailed information was to hand, and we were able to audit our accounts,” says Lança. “Furthermore, during a period of three years we were able to reduce our finance staff levels from 10 to 6 people.”
With IBS software in place, MMP is now able to automate its ordering process. When an order for a spare part is received from a dealer, the IBS solution immediately sends the order to the European central system in Holland. The solution then locates both the part and the warehouse where the part is kept and processes the order. In more than 95% of the cases, this will be in Madrid. Only 5 minutes after placing the order, a dealer knows if the part will be received the next day or if not. Because all the systems are in communication with each other, all parties are aware of the latest information. An online stock inquiry facility with the European Central system lets a dealer see the location and quantity of a part. This lets dealers give reliable information to end customers as to the availability of spare parts.
And for the future…
One of the reasons that MMP chose IBS software was because of the quality of the IBS team that would support its business. “With the help of IBS staff we have been able to adapt the software to our needs and we are now able to support every aspect of our business,” explains Lança. “There is no perfect software but with IBS software we can achieve A-level automation, which allows us to be more productive every day we use the system,” adds Ramos. The company is so impressed with the way IBS has fulfilled and furthered the long-term partnership as originally envisaged that Mitsubishi Portugal is now working on a project to upgrade IBS software to the latest version.