A spate of mergers, acquisitions, and divestitures seriously impaired the ability of Centennial, Colo.-based Stolle Machinery Company LLC to manage its own performance. But by rethinking its approach to forecasting, budgeting, and related activities, Stolle has created a consolidated entity with sharp insight into its costs and revenues.

BPM Magazine: What does Stolle do?

Michael Kalkman: Stolle Machinery Company provides capital equipment, spare parts, tooling, and services to the beverage and food can industries. We sell our machinery and services on a global basis to all the major can manufacturers.

Stolle Machinery is a collection of several companies acquired over the past 35 years. We were previously owned by Alcoa. The entities that made up Alcoa Packaging Equipment were sold in January 2004 to American Industrial Partners (AIP). AIP renamed the company Stolle Machinery Company LLC. AIP then acquired Sequa Can Machinery from Sequa Corporation in November 2004 and incorporated Sequa into Stolle. AIP sold Stolle in September 2006 to our current owners, Littlejohn and Company.

BPM: This M&A activity must have created challenges in your budgeting and management reporting.

Kalkman: Absolutely. Bringing together so many processes and people is our biggest challenge. On March 17 of last year we all went onto the same system, all sites. It's been a challenge to merge cultures and processes, and the way people plan and operate.

BPM: What software do you use?

Kalkman: We use IFS Applications as our ERP system and a combination of IFS and Excel for performance management. At the corporate level, we went live on IFS Financials in 2004. We haven't gone live yet with the forecasting module. We have a lot on our plate as far as learning the modules that we are already live with. Since people only have so much capacity to change, we still use some Excel, but less and less with time.

BPM: How did you approach coming up with one budgeting and management reporting process?

Kalkman: There are just too many inputs into the system to be on multiple software tools. Some of the companies that were rolled into Stolle competed with one another and dealt with many of the same customers; their product lines overlap. And it wouldn't make any sense for managers of an acquired company in Ohio to forecast for the same sales opportunities as the managers in a business unit in Colorado. They would be stepping on each other's toes, and our forecasts wouldn't be accurate because only one of those divisions would be able to make the sale in the end. We all have to be on the same system.

Plus, we have close to 900,000 part numbers. The cleanliness of our data is key to making the best sales and marketing and production decisions. If our data isn't complete and accurate, it's going to drive processes that may produce a wrong outcome. Our budget and management reporting system is linked to a scorecard approach, where we measure more than just EBITDA. We also measure inventory turns, procurement variance to standards, etc.