July 2005 | Case Studies | DC Solutions

The Great Trane Robbery: Stealing Back Efficiency

Tags: Warehousing

A new WMS puts HVAC manufacturer Trane in the comfort zone, helping increase shipping efficiency and improve material flows.

You probably don't give your heating, ventilating, and air conditioning (HVAC) system much thought. But if your air conditioner breaks down on a 90-degree day, it's likely to be all you can think about.

One HVAC manufacturer that works hard to ensure breakdowns don't occur is Trane, a leading global provider of indoor comfort systems.

Trane, a $5-billion division of American Standard Companies, is committed to developing reliable HVAC systems, and developing its logistics systems as well. As part of that commitment to logistics, Trane recently implemented a new distribution center network-wide warehouse management system (WMS) from Milwaukee-based Irista Inc.

While Trane previously utilized a WMS for 15 years, the Irista solution has helped the company reach new levels of efficiency within its DC operations.

Trane's DC network comprises seven facilities, one of which serves as the central DC. This main, 250,000-square-foot facility in St. Louis, Mo., is the company's distribution hub, and works as a "mixing" DC where product is received from a variety of sites, then shipped out.

The six smaller DCs are located adjacent to Trane factories and distribute products manufactured at those specific locations. Each of the seven DCs ship to 70 smaller regional or "field" DCs scattered throughout the United States, mainly concentrated in the South and Southwest.

"Some customers receive multiple truckloads each week, but our goal is to ship to every customer at least once per week," explains Trane's Gary Pool, U.S. IT team leader for distribution systems.

New System, New Controls

Trane's operations are orchestrated down to the last detail by its new WMS, which controls warehouse functionality from the end of production, into the DC, and out to customers. The Irista system was added when Trane's original WMS provider pulled the plug on its solution.

"Our WMS provider was acquired by another company. They let us know that they weren't keeping the WMS, so we had three to four years to migrate off that system and find a replacement," Pool explains.

So began Trane's search for a new WMS, conducted largely at trade shows and through the Internet. "We sent out an RFP, and that narrowed the search down to Irista and two other providers," Pool recalls. After careful analysis, the Irista system came out ahead.

Having the new system integrate easily with Trane's existing ERP—something its prior WMS did well—was one of Pool's key concerns in choosing a new WMS. Trane also wanted a system that would help eliminate non-essential costs by improving material flows within its finished goods warehouse, and offer real-time inventory and order status visibility.

"The Irista system was a good fit for us for several reasons," says Pool. "It was available on the same platform, it was flexible, and it had the capability to integrate easily with our ERP system. We also liked the amount of support Irista offered."

Irista found Trane to be a good cultural match as well. "After touring Trane's facility and learning its goals, we knew our application was a good fit for the company," says Jim Stollberg, vice president and general manager at Irista.

"Trane impressed upon us its desire to build a world-class warehousing operation to support its distribution network. The company mapped out an aggressive implementation schedule, which meant the system needed to be as intuitive to use and install as it was functional," he adds.

The Trane team appreciated Irista's efforts to make a good match. "Their managers interviewed us because they wanted to make sure we'd be a good fit for them also," says Dan Becker, applications developer at Trane.

From their up-front groundwork, the two companies forged a productive partnership. "Many of Trane's business processes were developed to create competitive advantage," says Stollberg. "Trane knew, for example, that every vendor would have a 90-percent functional fit to its business and operations requirements. Based on the work we've done with other manufacturers, we knew Irista could provide a solution to meet the 'other' 10 percent of Trane's unique operational requirements."

Though the two parties spent ample time reviewing goals and processes, and ironing out the details of their relationship, the implementation hit a snafu when the initial time line was delayed while Trane worked to implement new Sarbanes-Oxley regulations.

"We knew the implementation was going to take longer than we wanted," says Pool. "We weren't able to roll right away, but once we dedicated ourselves, it took about six months."

As a first step, Irista's team performed an operations assessment for Trane. "They met with us and documented all our business needs and operations," says Pool.

By closely examining Trane's processes, Irista was able to determine exactly what fit into the WMS functionality and what needed modifying. "The time and money spent on the assessment phase was crucial," says Becker.

As Pool hoped, integrating the new WMS with Trane's ERP system proved relatively painless. Despite the delay due to Sarbanes-Oxley issues, start-up of the new solution occurred within Trane's time and budget constraints.

The St. Louis facility was the first to go live—in January—and two regional DCs have come up to speed since then. Disruption of processes at each facility has been minimal. "Within two weeks we were up to our normal shipping and receiving schedule," Pool reports.

Cool Results

While the Irista system was initially added to replace the company's old WMS, the new solution has brought Trane several added benefits. One is that Trane can now ship out of multiple DCs simultaneously.

"With the old system, we could only ship from one building at a time and didn't know if we were short parts until orders were released," says Pool. "Now we can see where all our parts are, and ship from multiple sites at the same time."

In addition, the Irista system supports Trane's ongoing Six Sigma initiatives as well as its Sarbanes-Oxley compliance requirements. The solution also more effectively manages labor, equipment, and space utilization, helping to drive down costs and support future growth.

And the Irista system runs 24/7 without having to be brought down for upkeep. "Our old system required that we shut it down at least two hours each week for maintenance," explains Pool.

One nice side benefit of the implementation is that Trane was able to utilize its existing RF hardware so it didn't have to make an additional equipment investment, or bombard employees with too many new systems at once, says Becker.

Another employee-friendly perk comes from the Irista system's application screens, designed to mirror those in Trane's old system. The similarities make the transition easier for DC employees.

As more Trane facilities go live with the Irista WMS, the two partners continue to strengthen their working relationship.

"We have been impressed with the support we've received from Irista," says Pool. "They've stayed in close contact with us throughout the entire roll-out."