It was touch and go for the first three years. Cascade Designs Inc., a Seattle-based maker of outdoor equipment for camping and hiking, had purchased a full-scale enterprise resource planning system - the kind usually deployed by companies several times its size. And many were questioning the move.
Privately held Cascade had a tough time convincing its board of directors, major shareholders and business partners that the big software investment was worth it. "For three years, most people would say it wasn't a good bet," recalls chief information officer Ken Meidell. Soon, however, they would all become converts.
Cascade only had about $35m in revenues when it acquired the "tier-one" ERP package from Denver-based J.D. Edwards & Co. in early 1998. But the company had no intention of staying small. Lee Fromson, then chief financial officer and now president of Cascade, pushed hard for the deal. "His vision was, let's take the pain and do it once, even if it is expensive," says Meidell.
As it happened, sudden growth was just around the corner - or, literally, right down the street. In 2001, Cascade purchased a Seattle neighbor, Mountain Safety Research, from the camping goods cooperative Recreational Equipment Inc. (REI). MSR, founded in 1969 to research the safety of climbing equipment, was nearly the size of its suitor, creating the potential for all sorts of problems in merging the two entities. But those problems never materialized. According to Meidell, who joined the company around the same time to help manage the merger's IT aspects, Cascade switched MSR's manufacturing systems over to its own in just three months.
Having a large, sophisticated ERP system in place made all the difference. The J.D. Edwards software was scaled for rapid growth. "They could not have done that acquisition as smoothly ... if they were on another system," says Eric Pozil, account executive with PeopleSoft Inc., which subsequently acquired J.D. Edwards.
Fromson had to justify the ERP purchase by more than a vague promise of growth several years down the line. Cascade's more immediate need, says Meidell, was to combine two unconnected systems required for manufacturing. Specifically, it needed to link processes for the management of financials and order entry on one hand, and material requirements planning (MRP) and purchasing on the other. Purchase orders generated by the old MRP system were being manually entered into accounting, causing a lag in information and heightening the risk of database errors.
By early 1998, ERP vendors were well established in the market, promising to unify and control business processes like never before. Fromson was a big advocate of Microsoft products, and J.D. Edwards offered OneWorld, an ERP system that would run easily on the Microsoft platform.
"That product really transformed Cascade Designs," says Meidell, who was a consultant with Ernst & Young at the time, helping with the ERP implementation. It "completely closed the loop" between key systems, he says, while adding functions such as kanban support and support for multiple currencies.
Cascade was able to harvest a large volume of data that helped it better to understand its cost structure and streamline processes. "As the stakes got higher, and the market more competitive, we were able to validate our data," says Meidell. "That became a huge deal. We really are data-driven."
The Early Years
Cascade has been a pioneer from the start. It was founded in 1972 by two former Boeing engineers, Jim Lea and John Burroughs. A year earlier, Lea had invented the Therm-a-Rest, the world's first self-inflating camping mattress. Manufacturing began in Seattle in 1973, then was extended to Ireland in the mid-1980s for European distribution. Sales are now throughout the U.S., Canada, Europe and Australia, via specialty retailers such as REI, Eastern Mountain Sports, Dick's Sporting Goods, CampMor and Bass Pro Shops. Cascade's brands include MSR back-country camping equipment, Therm-a-Rest mattresses, Platypus water bottles, SealLine dry bags and rudder systems, Tracks hiking staffs, and Camp K-9, travel gear for dogs. Two other divisions make wheelchair-positioning products and outdoor equipment for the military.
|"They are doing a lot of things that bigger companies are already doing."|
- Eric Pozil of PeopleSoft
|Cascade Designs at a Glance|
|The company: A manufacturer of specialty outdoor equipment for backpacking, rafting, camping and hiking. Also makes seat-positioning products for wheelchairs, and outdoor equipment for the military. Brands include Therm-a-Rest, Mountain Safety Research, Platypus, Camp K-9.|
History: Founded in 1972 by Jim Lea, inventor of the self-inflating Therm-a-Rest mattress, and John Burroughs
Top executive: Lee Fromson, chief executive officer and president
Manufacturing: Four plants, three in the U.S. and one in Cork, Ireland
Revenues: Approximately $100m. Grown from $35m in 1998
Employees: Approximately 430
Supply-chain objectives: Acquire enterprise resource planning and supply-chain systems to accommodate growth through acquisition; combine key business processes into a single database; control inventory and costs; implement a "demand- driven" manufacturing model.
Supply-chain and ERP software vendor: PeopleSoft Inc.
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