Kurt J. Lesker Company modernizes business operations with Dynamics 365

Kurt J. Lesker Company (KJLC) has provided high-quality vacuum technology solutions and thin film deposition systems since 1954. Its products, from small components to large modular systems, are the foundation of innovations and advancements in the semiconductor, optical, material research, automotive, and aerospace industries. More than 500 employees in four divisions and seven global facilities serve thousands of customers every year.

A legacy with Dynamics 365 sets the stage for change

As a long-time Microsoft customer, KJLC knows the value of managing finance, supply chain, sales, customer service, human resources, and e-commerce operations with Microsoft Dynamics 365.

KJLC started using Microsoft Dynamics AX in 2007. The system served the company well and was key to the successful expansion of its four divisions. However, by 2018, its most recent version was aging past software support, becoming challenging to maintain, lacked a single, cloud-based data source, and didn’t have the latest features. As the company added products, locations, and warehouses, the need to standardize and unify manufacturing processes, centralize all data, and improve sales collaboration between locations and divisions, it became clear that the legacy system required an upgrade.

For example, Dynamics AX didn’t offer a robust customer relationship and sales management tool, so KJLC sales teams managed leads and pre-sales activities using Excel spreadsheets, SharePoint lists, shared folders, and Outlook. The Human Resources (HR) team also used similar tools to manage employee hiring, vacation requests, training, and more. The system was “ripe for improvement,” according to Global IT Manager, Tom Dockstader.

Rather than turn to another third-party solution, KJLC chose to upgrade to Dynamics 365 and its standalone HR solution, known at that time as Talent. Since all KJLC projects and activities are tagged to employees using HR data for everything from sales and purchase orders to timesheets and invoices, the team chose to implement Dynamics 365 Talent first and add Finance, Supply Chain Management, Sales, and Project Operations later. The modern solution included many features that KJLC had been waiting or hoping for from Microsoft’s enterprise resource planning (ERP) platform. Chief among them was advanced warehouse management capabilities that included a mobile application version for use on handheld devices to simplify shelf-level inventory tracking of the company’s more than 15,000 inventoried parts and products, increased traceability of touchpoints and order status, serial number tracking, and a real-time view of inventory on-hand.

Internal innovation leads to a smooth transition

As planning started for the migration from on-premises to the cloud, KJLC took the opportunity to review all business processes to make the best use of Dynamics 365. The implementation team enlisted stakeholders throughout the organization in business process modeling exercises.

KJLC leadership also shared feedback and requests with Microsoft that they felt would enhance the product and solve some of its company’s business needs. They appreciated the open dialogue and Microsoft’s responsiveness. As Dockstader describes, “It may take a while for requests to percolate into the product, but we’re satisfied that Microsoft is always listening, and responsive to feedback from customers.”

Business benefits from the latest technology and tools

KJLC went live with Dynamics 365 Talent (Talent)—a legacy standalone Dynamics 365 product—in early 2020 for all human resources data and migrated the remainder of the solutions before the end of that year.

Once live, regular synchronization was established between the HR solution and the finance and operations platform for near-real-time data access. Dynamics 365 Finance processes core financial transactions, including multilevel consolidation, financial reporting, along with credit and collections across five operating entities and four subsidiaries. Supply Chain Management provides purchase requisitions with approval workflows, production processes for make-to-stock and make-to-order, inventory and warehouse management, and master planning. Project Operations manages work breakdowns and tasks for product engineering. To complete the solution, independent software vendors (ISVs) address specific business needs: Avalara for US tax, SK Global Treasury for bank integrations and credit card processing, Supply Chain Cloud to integrate small parcel shipping carriers, and Bluestar PLM for product lifecycle management. Says Dockstader, “Dynamics 365 provides the solid but flexible foundation for KJLC to grow our global business.”

Some of the many capabilities and benefits that KJLC has realized include:

Supply Chain Management provides new insights and controls

The legacy system didn’t offer a way to segregate and manage inventory for specific uses, locations, or products; making it challenging to know exactly how much was on hand and if it was adequate for all incoming orders. Now, with Dynamics 365 Supply Chain Management, material purchases associated with specific orders or production sites can be aggregated for easy handling and supplier volume discounts. The new system reduces effort, confusion, and conflict, since everyone has what they need, where they need it, and it’s all tracked and visible to anyone who has required permissions.

The integration options with Dynamics 365 Supply Chain Management allowed KJLC to increase the connections with their e-commerce website. Price and availability information from the system accurately shows to website users, and shopping cart information is transferred back into Dynamics 365, eliminating historically manual back-office processes. These capabilities have boosted growth through increased e-commerce revenue and reduced overhead costs per order.

With more than 50,000 small parcel shipments every year, having a more detailed view of inventory is increasing KJLC’s ability to achieve same-day shipping and better plan for stock that requires longer lead times. And while controlled products make up a fraction of the company’s inventory, when they are used, proper tracking and workflows in Dynamics 365 help the company stay in compliance.

The right CRM tools accelerate adoption and sales

With Dynamics 365 Sales, customer data is integrated across Finance and Supply Chain Management, giving everyone a 360-degree view of customers. KJLC also uses lead and opportunity management, providing visibility to sales being nurtured. With the integrated order process, Sales users have a complete view of in-progress orders to provide the best possible customer service. “In the past, somebody in sales would do something and then essentially the order went into a black box,” says Dockstader, “and nobody knew its status until the order was actually shipped.”

After revamping the company’s processes, including moving a lot of implicit steps to explicit steps, Sales is much less involved in the order fulfillment and delivery processes. Now, says Dockstader, “Sales does sales things and our logistics team does logistics and delivery things.”

The sales team also loves the system’s mobile-first interface, which translates well to the easy-to-use mobile app and saves time on data entry and administrative tasks. And because it’s secured and authenticated with Microsoft Entra ID, Dynamics 365 Sales doesn’t need a VPN, improving the user experience. Salespeople are enjoying the flexibility of the tool and having everything in one place. Integration with Outlook and Microsoft Teams has also eased onboarding and makes sure that every conversation is captured, making it easy to see the status and ownership of each entry.

Integrating HR completes the platform

The latest piece of KJLC’s modernization effort involved an infrastructure migration. In 2023, the company moved from Dynamics 365 Talent to the latest Dynamics 365 Human Resources solution, which is now integrated into the finance and operations platform. The company was impressed by additional features the migration offered, such as the ability to make customizations, easy exports to Dataverse and Azure Data Lake Storage, more reporting, and the visibility it gives to managers about their team’s training and performance.

The KJLC team executed a one-time data migration and performed all tasks themselves using automated tools purpose-built by Microsoft to support these customer migrations. In the lead-up to go-live, employees attended brief training sessions regarding some minor updates to the UI and processes. After the new infrastructure was established, IT initiated a one-way migration of time tracking, ordering, employee, and other data. The cutover took place in October 2023. It was, as Tom Dockstader described, “a non-event” and continues to run smoothly.

Always investing in value-added technology

KJLC ran its business on the same code base for nearly 12 years. Since 2020, its cloud-based Dynamics 365 instance has been updated many times, receiving security enhancements, fresh features, new learning tools, expanded reporting, and now Microsoft Copilot. Leadership enjoys knowing the business is running on the latest technology from Microsoft and is confident that updates will always contain the latest innovations. “There’s been a dramatic shift in our ability to manage change using Dynamics 365 for the past three years,” says Dockstader.

KJLC continues to look for ways to alleviate repetitive tasks. Soon the company will add the Dynamics 365 Finance invoice capture solution, offering automated vendor invoice creation from digital images, and AI-powered finance insights. With the Planning Optimization Add-in for Dynamics 365 Supply Chain Management, the company will be able to run more frequent planning to suit the needs of each location.

Microsoft Copilot for Sales is gaining traction while the company provides training and feedback sessions. KJLC is beta testing Microsoft Copilot for Finance and Supply Chain Management. Leadership likes the idea of the protected data structure of Bing Chat for Enterprise, which will allow employees to use a chat interface to search for company files and other content.

Dennis Sollon, Vice President of Sales, Marketing, and Digital sums up the company’s experience, saying, “With Dynamics 365 Supply Chain Management and the rest of the Microsoft ecosystem, KJLC can see how our operations are changing and how our team’s productivity is improving, which helps our business grow around the world.”