Digital transition assists Mustad in staying worldwide Hoofcare leader
Mustad Hoofcare is a genuine family business with a long and rich history; it is currently owned by the seventh generation. The company is a worldwide leader in developing, producing and selling products for the farrier: horseshoes, nails and a wide range of tools, active in almost 100 countries. Though operating in a traditional market, Mustad strives to be a frontrunner in quality, service and innovation. To achieve its strategy and become a modern, data-driven company, the company wants to implement one way of working, based on one set of business applications.
HSO supports Mustad with a multi-year programme of digital transition, including the international roll-out of Dynamics 365, Data Insights and BI solutions and the Modern Workplace (Microsoft 365), along with a thorough Adoption & Change strategy.
Hans Mustad is the seventh-generation owner and Group CEO of this remarkable family company. He has owned Mustad since 2006 alongside his cousin, building the company further and consolidating its market position. They have invested significant effort in its expansion to North and South America in recent decades. Where the previous focus was on horse-nails, the company added horseshoes to its product portfolio in the nineties. Hans Mustad: “We currently have around 600 employees worldwide. Our overall purpose is to make every farrier’s work easier. We are a very well-known company amongst farriers, and as we are a business-to-business company, they are our most important target customers.”
Seeking opportunities in a competitive but stable market
Hans Mustad explains the market and describes Mustad’s strategy: “Mustad aims to be the first and the best in the market. We’re well-known for our quality, which must be very consistent, since our customers cannot afford to make mistakes when shoeing the hoofs of an expensive racehorse, for example. Product development is crucial in meeting our customers’ changing demands. There are growing numbers of female farriers, and their needs are different: lighter tools for instance. Another important strategic objective is strengthening our relationships with the farriers. We do that by providing training and sponsoring events, and we want to service them better, for example through online services and insights into their sales and customer data. It is particularly the younger generation of farriers who expect this from their partner.”
From business strategy to digital transformation
Mustad’s strategic objectives called for a uniform and more efficient way of working, and for insights into business information and data. Hans Mustad: “We have consolidated and continue to consolidate various segments of our company. We have gone from fifteen factories to seven. This consolidation is one of the drivers of the digital transformation we have launched. We need to redesign our business processes and implement one way of working in every operation. We also need access to reliable and current data and reporting so as to manage the company better, support our teams and deliver the best customer service. This requires a new cloud-based IT-platform.”
Hans Mustad continues: “We want to be top-of-mind with the farriers, to continue being their preferred supplier. Our mission is: ‘Make life easier for the farrier’. Our digital journey will help our customers to become digital too. Digital communication, easy access to their orders and product information will help them to run their businesses better. The company was traditionally led by making very intuitive decisions. The objective of our digital strategy is to become more data-driven. Using one digital platform across the company, for production, machinery and customer related processes, means we can rely on one set of data, as a basis for making well-informed decisions.”
A successful international roll-out of Dynamics 365 Finance & Operations
Mayra Mouthaan is interim Group CFO at Mustad, and together with Erik Lokhorst, Manager Operations, she is responsible for the international roll-out of Dynamics 365. This means quite a lot of travelling for Mayra, Erik and the HSO team.
Mayra: “Presence of the team in the international offices is essential for a successful implementation and adoption. So far we’ve been working on improving the application in Europe, and we were able to get Mexico live in November 2019 and Colombia in February 2020. Mexico was relatively easy, because it has no production facility and we profited a lot from all the improvements we made in Europe. We have learned that it’s important to take enough time for each project. We have a limited set of people available and sometimes this slows down our pace, but we believe strongly that it’s better to postpone a go-live by two to four weeks, than to go live when it doesn’t feel right.
Erik adds: “What we saw in Europe, and what we also expect in the US where they have been working with NAV, is that people were quite happy with the way they were working before Dynamics 365. They didn’t see the immediate need for change. That’s why we want to be on location to start the conversation. On the other hand, in for example in Mexico, our finance teams were using such an old system that Dynamics 365 made their life easier from day one, and the people were much more willing to adapt.”
Mayra agrees: “I’m very happy with the standards in Dynamics 365, but it means we have to adjust our processes and way of working. Everyone must stay in the kernel to unify our processes. This requires a lot of communication, but being present locally pays off. When we were in Colombia before the go-live, we went from 20% finished on the first day, to 90% finished by the end of the week, because we showed commitment, offered support and took quick decisions. In a pressure-cooker phase like that it’s important to stay positive and supportive. We found that a competitive element also helps to get things done.”
The Microsoft platform gives Mustad one single truth of data
Mustad selected the Microsoft cloud platform because of the company’s international character and its multi-faceted organisation, with R&D, production, sales and service in place. The complete platform covers all digital business needs. Erik: “Some of our country operations had been using NAV previously, so we were familiar with the Microsoft look and feel. Dynamics 365 F&O fit our kernel best. The move from the Google Suite to Microsoft Office 365 requires some effort but again, the look and feel is very familiar, so we expect that people will get used to that quickly.”
Erik emphasises the advantages of the cloud platform: “With our old software we were lacking uniformity in processes and in data, for example the naming and sizing of our products. Dynamics 365 means a big step forward in gaining insight, and in recognising trends and forecasting, because we’ll have one single truth of data. Soon we will all use one database and speak the same language when it comes to entities and processes.”
Successful collaboration with HSO International
The Mustad team is positive about its collaboration with the HSO team. Hans Mustad: “The quality of the HSO sales team was good and, what’s even more important for us, the sales team has stayed involved, including throughout the implementation. The HSO team is willing to put in the extra mile. Another plus is that HSO has its own offices or qualified partners in our regions, and at the same time we have a single point of contact. Finally, the strong adoption & change offering that HSO has in place has great value for us.”
Mayra and Erik also appreciate the way HSO works. Mayra: “I had a good connection with the HSO international project manager right from the start. I find transparency very important, and I appreciate it that we openly discuss all the issues that arise. I like working with tech people generally, because you can speak directly to each other and be clear and transparent. Another positive element is that HSO shares the Microsoft vision on digital transformation and the importance of best practices.”
Mustad on its way to a successful digital transition
Hans Mustad understands that the digital journey the company has started will probably never end. Hans: “We already start seeing the first benefits of Dynamics, and our goal is that all day-to-day users, including HR, marketing and sales, use and are satisfied with the new platform. The project will have been successful when our employees are happy and benefit from the software every day, and I’ll be happy too.”
Tip from the Mustad team: stick to the standard
The Mustad team is happy to share tips with other (international) companies making a digital transformation and rolling out Dynamics 365 and the Microsoft platform (Azure & Microsoft 365). Hans strongly recommends not undertaking too many projects at the same time, implementing a thorough Adoption & Change process, and continuing to measure your ADKAR scores.
Mayra shares her favourite three rules: “The first is to keep it simple. Don’t try to change too much too fast, and keep your project clear and manageable. My second rule is to stick to the scope, so as to avoid losing focus and postponing an on-time delivery. Thirdly I recommend sticking to the standard. Best practices are best practices for a reason, even if this means you must redesign your business processes. This implies dedicating lots of time and effort to change management and communication, but that definitely pays off.”
Erik agrees: “I would also recommend sticking to the standard as far as possible. Of course, customisations are possible, but with every upgrade there’s a risk that these cause issues. Since Microsoft has implemented One Version and your application is being updated every month, any customisations might cause delay and problems. If your colleagues no longer trust the software, there’s a serious risk of acceptance of the system decreasing.”