Otis Elevator Case Study

OTIS ELEVATOR

Summary

Otis elevators, a subsidiary of United Technologies Corporation, are world leader in manufacturing, installation and service of elevators, escalators and moving walkways. They started using IT applications in their company by introducing OTISLINE, a 24 X 7 customer service center, in the early 1980s. Later on by launching programs like REM, NCE, EMS, Otis Elite Service and e*logistics, the company moved from being an elevator company to a service company. In Supply chain an application named ACE was introduced which aimed at streamlining working process and at the same time reduction of manufacturing cost but with high quality levels, thereby bringing down the cost and both manufacturing function and supply management functions were redesigned into another worldwide production network and logistics administration capacities

Installing OTISLINE in 1990

When OTISLINE was introduced, the company was already operating in six areas including the US. They had a huge customer base across all regions. But with this concept a group of 160 people worked 24 X 7 so that they could respond to a customer in less than a second. Keeping in view the large and diverse customer base of the company, launching centralized customer service operations in 1990 would not have been an easy thing to do. Streamlining all the various regions and connecting them together for getting a database of the service delivery, response time to customer and other issues would have taken detailed planning, co-ordination among various levels and hard work from the IT department.

IT tools used in Otis in 2004

Otis introduced a major IT initiative e*logistics program in early 2000 which managed to connect sales, factory and field operations through internet based communication, workflow tools, extensive database etc. The way e*logistics managed to streamline various processes is given below:

• Project Proposal – The entire process was made transparent for both Otis employees like sales supervisors and field installation supervisors, and the end customer. This made the commitment as regards to the estimate of project more binding. Previously the data collected from other steps of the Project Proposal was spread across systems, but with e*logistics it was all integrated and fed into a central database making it simple and easy to use.
• Sales Processing – Prior to e*logistics, the entire process of booking, validating and scheduling an accepted proposal was manual. But now the system managed to collect data from all the regions and feed into the financial systems. Henceforth, a workflow was created which automatically sent relevant information to the respective heads.  Any changes made by the customer were also made easy to record and refer by everyone.
• Order Fulfillment – Otis had several regional contract logistics centers (CLCs) which worked with various subsystem integrators (SSIs) to fulfill an order. They communicated mainly with field-installation supervisors, customers and sales representatives and their work areas included everything from customer service to all the other requirements related to fulfilling an accepted order. Using the intranet and internet, the CLCs could see all the orders and procure supplies and materials from anywhere in the world basis of cost, quality and delivery time. All this was made possible only because of the IT development happening through e*logistics.

• Field Installation – A field-installation supervisor was responsible for almost 100 construction sites simultaneously. The e*logistics program sent timely e-mail reminders to the supervisor for site visits and waited for a status report from them before shipping any items to the construction site. This helped in moving Otis from a “push” system of sending items to the field as soon as they were manufactured to a “pull” system where the supervisor requested for a product based on its need. This helped in controlling the damage occurring to a product because of bad weather or vandalism if the product was delivered early. The field-installation supervisors used e-mails, which could be accessed from remote locations also, for communications and workflows to check site progress.
• Closing Activities – This is the final stage of a contract where the elevator is handed over to the customer. With e*logistics, a workflow was created on the completion of a job which dealt with things like billing and customer contacts.

The IT tools used by Otis at this time are really very simple- workflows, internet, intranet and e-mails, but they did give outstanding results. The technology was used in every aspect of the process, right from the proposal of a new contract to the final billing to the customer. It collected data at every step of the way and fed it into the financial systems across Otis, making it visible to everyone and to be used by the right personnel. A simple use of e-mails, accessed even from remote locations, kept in check the entire process of ordering a product, installing and fulfilling an order.