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Scaling Business Growth with an ERP Upgrade
1
The Challenge
Toll Brothers, a renowned Fortune 500 luxury homebuilder founded in 1967, faced a significant business challenge. With operations in over 60 markets across 24 states and looking to expand, its fragmented technology landscape hindered the company's growth. The JD Edwards World ERP system was outdated and out of maintenance with Oracle, posing a substantial business risk. The initial attempt to modernize with Oracle's JDE EnterpriseOne (E1) stalled due to difficulties in developing an automated data conversion process, a crucial step in the implementation. Toll Brothers required a reliable partner to help them overcome these challenges and support their ambitious growth plans.
2
The Solution
Following a thorough search, Toll Brothers partnered with Argano to implement JDE E1 using a comprehensive three-pronged strategy. This approach was designed to address the company's immediate needs while laying the groundwork for long-term success.
Data conversion and implementation: Argano worked closely with Toll Brothers to develop a methodical conversion strategy, successfully mapping over 11 legacy systems to E1. This process not only automated data conversion but also ensured a seamless transition to the new ERP system. Argano's strong project management and deep JDE subject matter expertise were instrumental in navigating the complexities of the implementation.
Software enhancements: As part of the transformation initiative, Argano provided critical software enhancements that drove business value. These enhancements included improvements to the sales and design studio platforms, which were delivered on time and within budget. By streamlining these processes, Toll Brothers was able to enhance sales efficiency and improve customer experience.
Managed support services: To ensure long-term success of the JDE E1 implementation, Argano provides 24/7/365 help desk support and managed services. This ongoing support reduces the administrative burden on Toll Brothers' internal teams, allowing them to focus on higher-value activities. The managed support services also ensure that the ERP system remains up-to-date and running smoothly, effectively future-proofing the company's business operations.
3
The Results
The JDE E1 implementation, powered by the Argano partnership, has been transformational for Toll Brothers. The results have been significant and far-reaching, with the company achieving:
Scalability and productivity gains: Toll Brothers successfully doubled its revenue from $5 billion to $10 billion while maintaining a flat overall headcount. This remarkable achievement was made possible by the increased productivity and efficiency brought about by the new ERP system. The company is now able to build and close two homes per employee per year, compared to one previously.
Financial improvement: The implementation also yielded significant financial benefits. General & Administrative (G&A) costs remained flat despite substantial growth in revenue, resulting in a reduction in G&A percentage from double digits to 8.7%. This improvement in SG&A leverage has had a direct and positive impact on Toll Brothers' bottom line.
Foundation for continued success: The E1 implementation has created a singular, reliable data platform that has become the foundation for Toll Brothers' next wave of technological maturation. The partnership with Argano has been instrumental in Toll Brothers' success, providing ongoing support and tangible benefits, enabling the company to navigate complex challenges while maintaining operational efficiency.