Office space innovator

Steelcase uses SAS®9 to improve sales, profits

Office furniture doesn't seem like a complicated product, but the people at Steelcase will tell you otherwise. One chair alone can come in hundreds of different colors and fabrics, three different arm styles, three types of backs, four types of casters and various trim finishes.

It's Roger Konyndyk's job to capture who buys what, from which distributor, at what price and why. "Cars are simple compared to office furniture, because when you buy a car, typically you'll have a limited choice of say five colors and three option packages," says Konyndyk, Steelcase's senior business data engineer, "Our products are virtually limitless."

Konyndyk keeps tabs on the company's organizational data, including sales history, distributor information, customer demographics and more. With just a handful of staffers, his department uses SAS software, fed by data from SAP/BW and other sources, to run customized reports for customers, distributors and more than 500 Steelcase decision makers.

With $2.6 billion in annual sales, Steelcase is the world's largest supplier of office furniture. An innovator since its inception as the Metal Office Furniture Company in 1912, Steelcase introduced fireproof wastebaskets and furnishings to America's new skyscrapers early in the 1900s. In the 1960s, it helped pioneer modular office furniture. Today, it is at the forefront of creating ergonomically designed furniture and office spaces that help improve workplace efficiency and effectiveness.

Steelcase also is a company in the midst of sweeping industry changes. Since the dot-com recession squeezed Steelcase and other office furnishing companies' profits in the late 1990s, the firm has become more customer-centric, while focusing on lean operations. Plus, the manufacturer is looking to expand beyond its core customer base of large companies to meet the needs of small and midsized businesses, as well as healthcare providers.

For the last few years, the manufacturer has used SAP Business Warehouse as the corporate tool to store data and create drill-down reports. However, many of the company's information needs involved complex merges and look-ups, bringing in additional data, or additional data manipulation. While Steelcase continues to use its SAP Business Warehouse reports to provide key metrics for suppliers, distribution and finance, SAS provides the power needed by the sales and marketing organizations for advanced analytics and trending.

"We have to do some fairly complicated merging of data; there is no way we could do that without SAS," Konyndyk says. Susan Hall, Steelcase's sales and marketing information manager, agrees: "While SAP/BW provides a valuable reporting tool for 'slicing and dicing' data across multiple functions, SAS is used for business market analysis and data mining projects extending our ability in the area of data integration and trending analysis."

Business intelligence with muscle
To fully understand the market, Konyndyk uses SAS for analysis. SAS helps Steelcase:

• Maintain a customer information database with more than 9 million names, and integrate it with sales history information.
• Report on 17 years of sales history.
• Prepare custom sales reports that target new markets.
• Offer monthly consolidated reports to large customers who do business with multiple Steelcase distributors to show what units they bought and from whom.
• Provide detailed reports to distributors that reveal their sales results in different niche markets compared to their competitors.
• Provide ad hoc reports based on complex selection criteria.
• Build a model to estimate market potential, integrating data from multiple sources.
• Develop statistical modeling for better forecasting and trending.

SAS for better partnerships
Steelcase's large customers frequently ask about what products they have purchased, where they were sent, and overall pricing and on-time delivery information. SAS generates monthly reports automatically and delivers them to key accounts, providing the detailed information executives need. Data fed through SAP/BW, in combination with other sources of sales, provides the necessary input to generate an easy-to-read, consolidated report.

For distributors, comprehensive graphical performance reports show how they are doing compared to others in the industry are important – and are difficult to do without the data integration capabilities of SAS. One distributor initiated a sales education campaign to get more business from the healthcare industry after reading his customized performance report.

Internally, SAS has helped Steelcase gain insight into its customers' and distributors' needs as well as help predict future sales – resulting in a savings of both money and time, as well as improved revenues. For example, the company has paid as much as $15,000 a year to send its potential customer information database to a consulting firm to create a list of targeted customers. Now, it's done internally with SAS.

Another example of immediate ROI is a SAS report that searched for a select group of inactive customers, which netted the company $15 million in sales. The selection criteria for that report were so complicated "a simple reporting package just could not handle it," says Konyndyk. "We needed the power of SAS."

Konyndyk also has new ways to help marketing and manufacturing groups make decisions based on what is selling. "With so many fabrics and finishes, merging the data is complicated; we have no way of doing it without SAS," says Konyndyk, who estimates that the number of combinations of furnishings, color, fabric and finishes would exceed 22 quadrillion.

Finally, Steelcase is initiating a pricing management program with help from SAS. After estimating the profitability of each product and each customer, the company can adjust sales offerings based on which type of customer is ordering which type of product. "The value of SAS is the capability of integrating data and gleaning knowledge from it," Konyndyk says.

When Konyndyk first started at Steelcase 25 years ago, he was using another statistical package to crunch numbers on market surveys. At the time, a family member suggested he try SAS. "I installed it and was amazed at what it could do," Konyndyk says. "And at Steelcase, we've built upon that ever since."

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