Okuma stays on the forefront of technology with Dynamics 365

The Americas-based arm of a Japanese parent company, Okuma America provides metalworking machines that maximize productivity for large manufacturers and small shops throughout North and South America. The company manufactures computer numeric control (CNC) driven machine tools designed to create metal parts and components for many applications. The product line includes lathes, multitasking machines, robust machining centers, grinders, and hybrid machine tools that combine additive and subtractive metalworking manufacturing in a single machine. Maybe you’ve never heard of Okuma, but you’ve benefitted from the machines it builds. Okuma America makes it possible for companies to make the things we use every day. 

Aging equipment

Okuma works to always stay at the forefront of technological innovation and while that is more than evident in its product and services, the same could not be said for its internal resource and relationship management systems. Its 20-year-old legacy system prevented holistic customer management and optimal strategic decision making by keeping data from the operations, sales, engineering, and service lines of the business siloed.   

Microsoft beat out its competitors because solutions like Dynamics 365 Supply Chain Management and Sales are uniquely flexible and can meet the needs of highly complex inventory and operational requirements. As a single-source provider of CNC tools that manufactures all components of every machine, the company has a complex product inventory. “We’ve sold more than 60,000 machines in the Americas,” says Jim King, President and Chief Operating Officer at Okuma America Corporation. “Every machine we bring over from Japan has a unique part number, and every option for that machine also has a unique part number.” With over 80 machine models which can be configured in countless ways and thousands of pieces of inventory at any given time, the need for an Enterprise Resource Planning (ERP) and a Customer Relationship Management (CRM) platform that streamlines, automates, and unifies is imperative.

New tools

The types of machines that Okuma produces weigh thousands of pounds and can take months to configure and build. It’s hard to imagine how many parts go into each machine yet Okuma is a leader in manufacturing precisely because it builds machines that are tailored to each customer’s unique specifications. New part numbers with their own unique bills of material (BOM) based on whatever configuration the customer needs are created every day. 

Given the highly specialized configuration and quotation process for its heavy, high-tech, custom machines, Okuma’s sales distributors use the Experlogix Configure Price Quote (CPQ) tool which seamlessly integrates into Dynamics 365 Supply Chain Management which flows into Dynamics 365 Finance via dual write integration. While the distributors don’t have direct access to Dynamics 365 Sales, they have a mirror view via Power Pages and can see all customer activity and information to give the best possible service. Distributors’ ability to communicate directly with Okuma’s call center via Power Pages means that data is written directly into Dynamics 365 Sales for a permanent account of customer issues—a vital datapoint for a company that makes customers for life. 

Dynamics 365 enables an automated and seamless process from quote to creation. Orders are created simultaneously in Dynamics 365 Sales and Dynamics 365 Supply Chain Management where BOMs and production routes are automatically generated. Okuma now has a comprehensive view of its four BOM levels with up to 250 subassembly lines for each option therein. Every order could have up to 1,000 lines of specifications. With material handling, electrical and mechanical assembly, and parts packing, it’s a safe bet that Okuma has roughly seven route steps for every option. Before Dynamics 365, it was difficult and time consuming to maintain the sheer number of routes, options, and orders and process them efficiently throughout the organization. Now, it’s instantaneous. “The second a service part or machine order comes in, it flows from the customer service team all the way down to our engineering team for customizations or directly to our warehouse team to ship in a matter of minutes,” says Joe Louro, Business Systems Application Manager, Okuma America Corporation.

Functions like Power Automate eliminate the time consuming, manual order-to-invoice pipeline that used to be done by hand. Once a work order is created, Power Automate automatically generates sales orders, which generate invoices. Automation frees up distributors’ time to focus more on the customer, see more customers in a day, and eliminates human error on invoicing, such as forgetting the last zero. 

Visibility extends to Okuma’s production warehouse. While the machines are built in Japan at the company’s headquarters, Okuma America’s facilities and warehouses are used to showcase Okuma machines, store inventory machines, and to repair or upgrade select machine components. 

Customers can rely on Okuma servicing, updating, and refurbishing their machines throughout their lifecycle. Advanced warehouse management features ensure that Okuma’s 15 warehouse workers have easy access to immediate inventory status, helping orders close faster.

Dynamics 365 Customer Service also plays an important role in streamlined service and exceptional customer management. Okuma uses customer service cases to drive field service activity. Because some of its machines require specialty expertise that distributors don’t always have, Okuma sends its internal field service team to assist on installation and service calls.

Data makes the difference

With Dynamics 365, “we’re able to understand market share growth better than ever before,” says King, “so we can drive revenue growth through an improved grasp on costing, the impact of sales decisions, and margins. In the end, this granularity helps us move through the cycle, from sales to operations. We’re excited to reimagine the possibilities for Okuma America.”

Working almost entirely within the Microsoft ecosystem has transformed Okuma’s approach to sales and customer service. But the benefits it sees permeate almost every area of the business. Louro sees it this way: “Gathering all this data over time has really helped our company make more informed decisions. We now have the analytics for strong forecasting, which in a business with long lead time is crucial.”  An Okuma machine can take months to complete from sales to delivery. Okuma is agile and proactive. “With Dynamics 365 we’re able to make decisions with the data before we actually need to have a decision made,” explains Louro.

That’s because a 360-degree view of data enables forecasting abilities to ensure parts used for in-stock machines and for service are kept in stock at the right levels both for new orders and updates or repairs for existing customers. With trend, demand, and transaction data readily available, Okuma can be proactive about resourcing, which also helps insulate it from market disruptions. Forecasting ensures Okuma can deliver what its customers want more quickly all while honoring the uniqueness of every customer. 

Data makes the difference for Okuma America. Fast access to historical information streamlines customer service and sharpens business insights. It also enhances collaboration. Before Dynamics, teams couldn’t efficiently move data around the company. Now, communication and problem solving are more efficient with standardized data in one system. Summer Cline, Sr. VP of Finance for Okuma America Corporation sums it up by saying, “Microsoft Dynamics 365 has allowed Okuma America to improve our processes and systems enabling us all at Okuma America to fulfill our mission of passionately pursuing lifelong customers.”

Form, fit, and function

The flexibility of Dynamics 365 solutions has played a key role in the company’s success. Okuma has extremely unique needs that can only be met with Independent Software Vendors (ISV) like Pacejet for its shipping process for example. Seamless integration of ISVs like this one into Dynamics 365 eliminates the need for potentially burdensome customizations ushering in a straightforward, out-of-the box solution that benefits from regular Microsoft updates. 

The inherent security of Dynamics 365 is a significant benefit for Okuma. Having a cloud-based built-in security layer provides a robust and scalable model for the business. What’s more, “being a wholly owned subsidiary of a public company in Japan, we comply with the Japan Securities and Exchange Surveillance Commission requirements,” explains King. “And we’ve simplified our compliance with those regulations by moving our systems to the cloud and having that Microsoft layer of security in place.” 

What’s next?

Looking ahead is easier now that Okuma has five years of data insights to look back on. Improving processes with Dynamics 365 warehouse management is already one marked for innovation and Okuma continues to identify opportunities to integrate new Microsoft functionalities.

Driving productivity and time savings, enhancing customer service, and increasing collaboration are among the many ways Dynamics 365 helps power the manufacturer that powers the manufacturers that touch our lives every day.