1994 Jun 01

AS/400 Catalog Systems
David M. Raab
DM News
June, 1994

Back when mainframes ruled the earth, the greatest threat to their existence appeared not to be swarms of PCs, but herds of larger creatures called mini-computers. Produced by companies like Digital Equipment and Data General, these were smaller, cheaper and easier to run than traditional mainframes, but still had the muscle to serve an entire department or small company.

The first generation mini-computers also resembled mainframes in having proprietary operating systems–that is, software written for one brand could not run on another without major modification. Later, attention shifted to “open” systems, whose software can run on many different computers. Along with ever-more-powerful PCs, these are widely considered the wave of the future. Proprietary mini-computers were consigned to the dustbin of history.

But somebody forgot to tell the people buying IBM’s version of a proprietary mini-computer–the AS/400. Buoyed by contented users, large numbers of software packages, excellent built-in database engine and competitive pricing, the AS/400 has continued to thrive. (It is also scrambling frantically to evolve into an “open” systems, but that’s another story.)

The AS/400 is especially strong among wholesalers and retailers. This has led to several mail order applications.

Mozart (CommercialWare, 617-551-0650) was released on June 1. CommercialWare’s previous product, OASIS, is probably the most widely used AS/400 mail order system, boasting about 70 installations.

Mozart is written entirely in the Synon Computer Assisted Software Engineering (CASE) tool. Synon generates the actual programs that run the system, based on definitions and rules entered by the developer. This makes it easier to develop the initial system, make later changes, and integrate third-party products such as report writers, fax transmitters and shipping manifest systems.

Synon made it relatively easy for Mozart to incorporate a sophisticated user interface, complete with pull-down menus and function keys. It will also allow Mozart to adopt a client/server configuration (using PCs hooked to the AS/400 server) some time in 1995, and, eventually, to run on Unix and other operating systems.

But the commitment to Synon also mean that any Mozart customization must be done through updating the Synon model, probably by CommercialWare. Otherwise, the modified installation will not be able to take advantage of future upgrades.

Mozart does incorporate several features designed to make customization less necessary. The system has user-defined fields available in most files, and allocates one function key on each screen for user-defined tasks. This function key can jump to another part of Mozart, run an external program, or call up a menu with several different choices. The function key can work differently for different users. In fact, each user can have an entirely different set of menus and menu options.

The system’s actual functions are quite solid. Order processing will automatically check for duplicates when a new customer is entered, applying a user-defined match code. The order entry screens also automatically determine the expected shipment date to promise a customer, taking into account open purchase order quantities, expected receipt dates and existing back orders on out-of-stock items.

The system can also display text prompts recommending a substitute for an out-of-stock item, or for cross sells and possible upgrades. These prompts can be linked to a specific item, or can be driven by promotion, customer, day of the week and several other variables. The prompts are only text, however–the system does not offer a “live” list of item codes that the user can actually select from to add the new item code to the order.

Mozart supports a full range of pricing options, including prices by customer, promotion, product group, date range, and quantity break. The system can choose prices in a defined hierarchy or find the best price among all the alternatives available to a particular customer. Sales tax is determined by Zip code, and the system can take rates from Vertex files if desired. It can also handle Canadian Provincial and General Sales Taxes.

Mozart offers comparably sophisticated inventory management. Kits can be both preassembled and packed to ship, and it can handle kits where the several components are chosen from a larger list at the time of order entry. The system supports serial numbers on inventory, closed end continuities, multiple warehouses, multiple locations within a warehouse, and links to the

Tandata shipping manifest system.

The base system includes fully integrated accounts receivable and payable, and can create transactions to export to a general ledger. Inventory can be reported based on average or standard cost, and FIFO/LIFO will be added in the next release.

Compared to the richness of its operational functions, Mozart is somewhat limited in the area of forecasting. Each item in a promotion can be assigned a response curve, but the system cannot automatically generate those curves from past promotions. Nor can it do a more traditional forecast based on historical demand for a product. And the system cannot automatically generate recommended purchase orders, although it is able to estimate future product requirements based on current forecasts, inventory on hand and outstanding purchase orders. CommercialWare plans to enhance forecasting capabilities in future releases.

Mozart’s mailing list management functions are built to support both in-house list selection and list rental fulfillment. The system allows selection of multiple file segments in a single query, based on a screen that can access precalculated summary measures, such as average order; specific transaction detail, such as products purchased; and user-defined demographic information. Mozart also supports Nth selections for test panels and maintains a history of the promotions sent to each customer, which can be used to omit previous usage for list rental clients. Although duplicate identification is limited to a match code algorithm, the system does have the ability to merge the histories of duplicate customer records when they are found.

The customer service function creates a separate record for each service transaction, which is automatically stamped with the date and user ID, allows the user to enter text notes, and is assigned an open or closed status to facilitate follow-up. However, the system cannot attach a call-back date for to a service transaction, and (apart from the text notes) does not hold resolution or problem codes to analyze trends, report results, or be used in list selection. This problem is limited to customer service, since the system does store specific, user-defined codes on item-related transactions such as returns, cancellations, refunds, and holds.

Mozart has an intriguing “threshold management” function that allows it to monitor specific performance statistics such as backorder level, returns and customer service actions. When a target value is exceeded for one of these, the system can automatically issue a message to a specific individual or execute a particular command.

The system also provides a full set of standard reports for operations and marketing. User-defined reports would be built with a third-party report writer that reads the AS/400 files directly, or by exporting data to a spreadsheet or database.

Mozart is running at two test sites, and CommercialWare expects about a half-dozen installations by the end of this year. The product is targeted at approximately the same scale of user as OASIS–typically around 70 to 80 users processing 6,000 to 10,000 orders per day. Pricing is based on order volume, and starts at $39,000 for up to 70,000 orders per year. A typical client might expect to pay about $150,000.

ORDER POWER! (Computer Solutions, Inc., 305-558-7000) represents a more traditional technical approach. Launched in 1990, the system is written in RPG, the AS/400’s standard programming language, and designed to be easily customized by either Computer Solutions or the buyer’s own staff. In fact, source code is provided to all clients, nearly all of whom make some type of customization. Computer Solutions usually manages to keep the modified systems compatible with future upgrades.

The system’s order entry screen does a relatively sophisticated check for duplicates, displaying a list of potential matches based on any of several fields. Set-up options determine whether the system shows the on-hand inventory when an item is entered. For out-of-stock items, the system can display the expected receipt dates and existing backorders, but will not automatically calculate the next uncommitted receipt date. Substitutions, cross sells and upsells work about the same as in Mozart–they are defined in text messages that can be driven by the item, customer, promotion, etc., but do not let the user select from a live list of item numbers.

Pricing options are also comparable to Mozart, including the ability to find a best price available for a given customer and to manage both assembled and unassembled kits. The system cannot set up a kit that requires the user to pick several items from a larger list, although it does handle “coordinate” items–for example, picking a printer and then selecting from a list of compatible cables.

ORDER POWER! handles sales tax at the Zip code level, allowing three levels of tax per Zip. Rates can be entered directly by the user or read from Vertex.

The system offers a full range of inventory management functions including multiple vendors, multiple warehouses, and multiple locations per warehouse. However, it is limited to average cost accounting and cannot track the serial numbers of items in inventory. The system has recently added bar code support for electronic weighing and manifesting systems, and for internal inventory labels. Computer Solutions is expanding its use of bar codes to include a “positive ship verification” system that scans each item in a shipment as it is packed, and gives a warning if something appears to be missing.

Accounts receivable is part of the base system, which makes credit history information available on-line during order entry. Optional modules are available for accounts payable and general ledger.

ORDER POWER! has especially powerful forecasting capabilities. It can automatically generate response curves from previous promotions, and will use these in item-level forecasts that are automatically adjusted as actuals appear. The system can create recommended purchase orders from the combination of forecasts, current inventory, existing purchase orders, and factors such as vendor price breaks and minimum order quantities. The purchase orders are stored in a file that is reviewed and modified by the user before they are actually issued.

Mailing list management is somewhat limited. For simple selections, the system offers a fill-in-the-blanks screen that is easy to use but lacks complex logic and multiple segments in a single selection. More sophisticated queries require IBM’s Query 400 tool, which can reference any type of individual transaction. The system stores only the last twelve promotions sent to each customer, which means a complete history is lacking. It also means there is no automatic way to omit previous usage for rental clients, short of placing text notes in the customer record. User-defined demographic data is limited to 20 one-character fields, although more could be added with customization. And although the system cannot currently merge the histories of duplicate customer records, this function is scheduled to be added in July.

Existing customer service features allow date and user-stamped text notes at the customer, order and item levels, and can store one callback date and reason note for a customer. In September, Computer Solutions expects to deliver an expanded module that will allow multiple callback dates, assign calls to specific individuals, track required actions, store resolution codes, and provide additional functions needed for trend analysis and technical support.

ORDER POWER! includes a wide range of standard reports, and relies on tools such as Query 400 or third-party software for custom reporting.

The system has about 40 installations, spanning the consumer, business to business, fulfillment and wholesale industries. A typical installation handles 1,000 to 2,000 orders per day and might have 50 users. Prices start at around $25,000 and can reach $200,000 or more. The existing price schedule is based on the customer’s computer model, but this will probably change to a user or transaction basis, mirroring a recent revision of IBM’s own pricing software structure.

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David M. Raab is a Principal at Raab Associates Inc., a consultancy specializing in marketing technology and analytics. He can be reached at draab@raabassociates.com.

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