Otis Elevator: Accelerating Business Transformation with IT

Otis was the largest manufacturer, installer, and servicer of elevators, escalators, and moving walkways in the world. Otis Elevator company has reformed itself as a service oriented company from an old line industrial company. This was possible due to the company’s focus on orders of magnitude improvements in logistics and service. It has integrated all the functions needed in perspective of customer and developed a single customer-centric business model. One Interesting fact is that 80% of the company’s revenue comes from outside the united states. This emphasizes that globalization played a significant role in terms of customer base, revenue. So, going forward the company should concentrate in expanding it’s operations all over the world, especially the emerging economies and attaining diversified customer database. One can easily infer form Otis transformation that Information Technology, Improvement in information flow and understanding market trend, customer needs plays a major role in changing the face of the company. Otis has restructured itself taking upon the fact that customer service, maintenance contributes more to the market along with the sales. OTISLINE Customer service center is one of the early IT applications in Otis which helped Otis dispatch group respond to customer in less than a sec. IT applications aids in improving visibility of business performance to management and providing more effective quality service to customers. Another important application was REM elevator monitoring, which helps in servicing the elevator even before it went out of service. An IT Initiative, e*Logistics program, facilitated business reengineering that took place throughout the company. With the e*logistics program the project proposal became automated and data integrated and fed the information directly into Otis financial systems. It made improvements signification changes and improvements in Sales processing, order fulfillment, Field installation. It led to easy management of orders, eliminate hidden costs, reduce turnaround time, manual effort, average time of the order life cycle. SIMBA program was launched to change the design process. The technological innovation Gen2 elevator is the fastest selling product in the Otis history. The IT initiatives aided Otis in redefining its business process into a service oriented one. The technological innovations have given an edge over the competitors. The company’s operating profits and revenue has increased hugely and the contribution to its parent company UTC, profit has increased from 25% to 35% during 2000 to2003. The new initiative of Otis was to stand as number one service company in the world not just in elevator business but compared against the greatest service companies ever. To accomplish this, the challenges of the e*Logistics program should be resolved. All the users should have required technology and process training. It takes time for everyone in the organization to adapt to the new business process. e*Logistics program should be rolled out throughout company across world. The systems should be improved and scaled to be more user friendly so that everyone can use them. Otis should concentrate on Streamlining its operations, Standardizing infrastructure, developing unique technological innovations to maintain their market. They should allocate share of revenue for advertising and expanding their operations in the emerging economies. Otis should take care that working capital ratio is not too high.