Survey on Parts Catalogs Reveals Industry Trends
JANA Inc. of San Antonio, TX completed a three-month survey to gain insights as to how parts catalogs are being used by companies and what changes can be expected over the coming years. The most surprising aspect was that – for almost half of the respondents – updating the parts catalog was a manual process requiring more than a week. A 2006 study (EasyLink Services, 2006) reported what most of us already knew -- automating workflow is the key to improving back office efficiency. Yet the process for many is still manual in nature – costing time and accuracy.
The Parts Catalog is seen as a product of value both internally (by their Customer Support group) and externally (by customers and dealers). In fact, almost 100% of respondents indicated that their catalog was used by both internal and external audiences.
Respondents were asked which group was responsible for creation of their Parts Catalog. 70% reported that the Marketing group had primary responsibility for this job function. Where this product was once seen as a ‘Technical Publication’ similar to a Manual, it is increasingly seen as an important tool in the marketing of spare parts used in servicing equipment.
The survey asked how long it takes to update a parts catalog as new data becomes available. Almost half (49%) of the respondents indicated that the time involved to update a parts catalog was more than a week, and another 20% reported it was somewhere between a day and a week.
Respondents were asked what their organization’s view was on the purpose of their Parts Catalog. Because the majority of catalogs are being created by the Marketing department, the natural conclusion is that the catalog is seen as a sales tool. And this conclusion was confirmed with 89% indicating that parts sales was a factor in having the catalog. The other functions were parts identification and troubleshooting for field support operations.
Seeing that parts sales was typically a very significant corporate objective, the survey went a little deeper to understand the spare parts sales strategy. Specifically, the survey asked if the parts catalog was the PRIMARY tool for spare parts sales. Overwhelmingly it was. Nearly 9 out of 10 responses indicated companies look to their parts catalog as the primary tool for parts sales. In reviewing various SEC filings, many companies place an emphasis on spare parts sales as part of meeting revenue goals. And it looks like parts catalogs are the HOW behind the scenes. No wonder parts catalogs are a critical piece of the sales strategy for companies looking to increase revenue.
The survey also wanted to know if the on-line version of the catalog (if an on-line version existed) was linked to an inventory system. These include Enterprise Requirements Planning (ERP) systems and Product Lifecycle Management (PLM) systems like SAP, Oracle/JD Edwards, Seimens and IBM. These systems can capture the Bill Of Material (BOM) of ‘as manufactured’ products and maintain the appropriate stock levels of inventory of specific parts.
In two-thirds of the responses, there was no integration between the ERP/inventory system and the parts catalog. This could explain why the updating process was more than a week for almost half the respondents. Integration with an ERP typically allows very fast catalog updates (almost always less than a day) via automated scripts.
The survey concluded by asking respondents to comment about what they liked or didn’t like about their catalog. While a statistical analysis would be difficult at best, most of the comments involved a desire to automate the current catalog process and link it to an ERP type system making it easier to push updates to the field. This reconfirms the finding that a more automated process is a prime mandate from those whose job it is to create and update the parts catalogs.
The questions were presented to employees nation-wide in the late first quarter and early second quarter of 2012 across their entire organization including Customer Support, Sales & Marketing and Information Technology groups.