December 1987 - November 1996
Our Leader, Ron Rashkow and Handy Andy at a grand opening of a new store.
Handy Andy was a major big-box chain of home improvement centers. It started out as a lumberyard on the south side of Chicago. The son of the founder sold the original lumberyard (Arrow Lumber) and opened his first home improvement center in Gurnee, Illinois. I think they had seventeen stores when I joined them and they were in the process of purchasing a chain based out of Cleveland named Forest City. The owner needed funding so he struck a business alliance with a Belgium group named GIB and the company started to grow in small, but controlled leaps. In the end, we had seventy-nine stores and they were beautiful.
As the only Director of Application Development that Handy Andy ever had, I covered a lot of ground in the development of retail systems. Here are a few of the systems that my team and I designed and built over my nine year run.
When I arrived at Handy Andy we had just purchased the JDA software and we were converting from a home-grown system on the IBM System 36 to JDA on the IBM System 38. We used the JDA system as a foundation for a tremendous amount of customizations that we designed ourselves. From inventory management, warehouse management and merchandise management we filled the need with custom systems. In later years we saw more sophisticated software solutions in E3 and Arthur but we had already designed those systems of our own.
One of the best systems we created was an automatic markdown system. The buyer could set any combination of a series of switches to drive product markdowns on discontinued (or out of season) merchandise to purge it from the store. Our software recalculated markdowns based upon inventories and sales and when the buyer came in on Monday morning the calculated suggestions could be approved or modified so the new price change batches could be transmitted to the stores later that evening. Those item markdowns could be set up at the store, district, region or global levels or they could be set up by ABC stores, department, class or sub-class or a combination of everything.
Good store inventories were the key to purchasing. We developed a scanner based cycle count system that the department managers used to verify and adjust their inventories. Every item had the capability of being set up for it’s own selling season(s) and based upon the season, the on-hand count and supplier lead times - our system would create purchase orders that would be reviewed and released by the inventory group. We set up a different system for distribution center items.
Store items that were supplied by our distribution center were usually in greater demand than our supply. We built an allocation system that spread inventories to our stores based upon such things as ABC stores or sell through. We didn’t forget to account for un-received shipments or shipments which were in-transit. We even made some allocation decisions based upon the expected arrival time of items from our suppliers.
Although JDA had an invoice matching system, it did not fit the requirements of our accounting team so we worked very closely with them and developed a very good matching system. Actually, it worked too good and it allowed us to make faster payments to our suppliers. The new system allowed us to reduce our Accounts Payable department from seventy people down to less than ten.
One of the most important components was the warehouse and store receiving systems. We changed from a line-item check in system to a random or “problem supplier” check in which reduced our receiving time by over 90%. That was a very complex system because of the nature of partial shipments and multiple invoices. Our company philosohy was to get our employees out of the back room and into the arms of the customer.
We developed a contractors business and we needed to support it in many ways with non-standard items and non-standard supplier payments. We selected the JDE accounts payable system and integrated it into JDA and it worked well for us.
Although we had over 150,000 items in our stores, we could not stock everything that our customers wanted but we wanted to make it available to them through our stores. We developed a special order system that included catalogs and a crossdock system that would either deliver the item to the store or directly to the customer’s home. We also adapted this system to provide delivery of special order items for our contractor’s business. This gave us great flexibility and outstanding customer service.
Handy Andy managed it’s own payroll down to every last detail. We replaced our home-grown System 36 payroll system and purchased a payroll and Human Resource system from (Integral?) and built an interface to our JDA general ledger system. We provided payroll for over six thousand employees with several different payroll cycles with only a manager and three data entry clerks. (in contrast, I was surprised to get to Sportmart and find a department of nine people to support ADP even though it was a company of similar size and requirements).
In the final year before our partners at GIB pulled up stakes and went home, we were in the process of developing a forecasting system that would help the buyers plan their purchases and help the merchandising team prepare their budgets.
My development staff was consistently the best out of any organization and we had a great reputation within the I.T. community. I had an arrangement with some of the colleges to allow their students to work on their senior projects in my company. The professors had worked with these students for years and they knew who was good and who were the slugs. They gave me the best and I hired and trained them. Those students became veterans very fast and my staff was very productive. The problem was, they didn’t last more than two years. Most of them went into consulting and not a single one of them ever failed on their career, except those that went to work for a major consulting firm in Chicago that went bankrupt. They would call me from time-to-time and tell me how much money they had in stock options. They received bonus’ in stock and they poured all their extra cash into even more stock. I felt very badly for them when they went from rags to riches and back to rags again.
I have used Handy Andy as the benchmark for years. Now I have a higher benchmark and it comes from something from every organization I worked for.
Reality Check: We spent nine years developing custom software solutions to provide us with a competitive edge. There were countless thousands of programs with detailed documentation and the bankruptcy was going to wipe out nine years of late nights, lost weekends birthdays and holidays and 70 hour work weeks. I was the last I.T. person to leave Handy Andy and before I shut down the systems for the last time I made a CD of all the programs we had developed over those long years. I was shocked to see that nine years of work only took up an inch of the inside ring of the CD. What did I expect? Would I have felt better if I carried out a box of floppy disks?
We were already under seige from Builder’s Square, Home Depot, Loew’s and Menard’s when a competitor, Home Base, opened up a new store right in our home territory. Someone at Handy Andy rented that billboard and a great marketing shot was fired.
HomeBase went out of business within a year and that building is now a church.
This was one of our ways of recognizing good work by our associates in the stores.