Virtual CTO Transformation Increases Throughput, Order Size, and Gross Margins
FAST FACTS
Industry:
Wholesale and Distribution
Specialty:
B2B fulfillment, third-party logistics (3PL), and multi-SKU distribution
Solution:
End-to-end digital transformation and custom distribution platform
Users:
Inventory managers, operations teams, order fulfillment, and enterprise clients
ABOUT THE PROJECT
A fast-growing B2B distributor had maxed out its operational capacity. Despite strong demand and a solid reputation in its niche, the company couldn’t grow. Legacy systems, manual processes, and rigid data structures made it impossible to expand into new product lines or increase shipment volume. Inventory was managed through spreadsheets. Sales ops were siloed. Tech debt was piling up.
PROJECT IDEA
- Unify fragmented systems into a composable platform capable of supporting multiple product categories and fulfillment types.
- Digitize and automate warehouse, inventory, and customer operations for speed and efficiency.
- Enable real-time visibility and scalable logic across pricing, inventory, and shipment workflows.
PROJECT CHALLENGES
- Rigid Internal Systems: The ERP was heavily customized for a single product type and couldn’t scale to support multi-category operations.
- No Real-Time Visibility: Fulfillment, inventory, and customer service operated in disconnected silos with no shared dashboards.
- Manual Order Workflows: Order processing relied on spreadsheets, handoffs, and email chains—slowing throughput and introducing error.
- Growth Blocked by Tech: The team wanted to expand, but the system couldn’t handle it—blocking both revenue and partnership opportunities.
RESULTS
- Shipment throughput increased by 35% through automation and streamlined pick-pack-ship workflows.
- Average order size increased by 20% as cross-sell opportunities were unlocked with better product data.
- Gross margins improved by 15% due to lower operational cost per order and fewer fulfillment errors.
- Leadership now has real-time insight into inventory, customer behavior, and revenue performance.
BUSINESS CHALLENGES
This distributor had grown organically into a dominant player in a specific niche—but their success became a constraint. Their ERP system had been built around one category and didn’t support new inventory logic. Their team was resourceful, but everything was manual: sales orders were typed in by hand, tracking numbers were emailed manually, and key reports were compiled at the end of each week—often too late to fix problems.
Clients wanted more SKUs, faster shipping, and cleaner ordering. The distributor wanted to become a trusted 3PL partner. But their systems—and their vendor relationships—were holding them back. That’s when Cognativ was brought in.
WHY DISTRIBUTORS TRUST COGNATIV?
Cognativ helps B2B fulfillment leaders modernize systems, eliminate bottlenecks, and unlock profitable scale. Our SmartSaaS™ architecture and RAPID transformation model empower distributors to reduce tech friction, automate fulfillment, and manage margin-critical operations in real time. Whether you're upgrading from spreadsheets or outgrowing a legacy ERP, Cognativ builds systems that scale as fast as your customers expect you to.
RIGID INTERNAL SYSTEMS
Their legacy tech stack could only handle one product structure—making SKU expansion operationally impossible.
NO REAL-TIME VISIBILITY
Key decisions were made using stale reports. Ops and sales had no shared source of truth.
MANUAL ORDER WORKFLOWS
Orders came in by PDF or phone, then were manually processed and fulfilled—causing slowdowns and mistakes.
GROWTH BLOCKED BY TECH
Each new customer or category exposed more fragility in the systems—so expansion stalled.
DATA ENTRY BOTTLENECKS
Inventory was updated manually at the end of each day—leading to backorders, stockouts, and customer churn.
MARGIN EROSION
Too much time and labor was spent on routine tasks—driving up cost-per-order and cutting into gross margin.
THE SOLUTION
Cognativ applied its RAPID framework under a virtual CTO model—leading strategic direction, technical rebuild, and operational rollout.
- Phase 1: Conducted an infrastructure and operations audit. Mapped key friction points across order intake, inventory updates, customer service, and warehouse handoffs. Identified systems that could be decoupled, modernized, or consolidated.
- Phase 2: Replaced the legacy ERP with a modular, SmartSaaS-powered platform. Designed workflows for multi-SKU inventory logic, automated order intake, dynamic pricing rules, and role-based dashboards. Connected sales, ops, and fulfillment in real time.
- Architecture: Cognativ deployed a composable micro-kernel that allowed internal teams to evolve independently. Product data, pricing logic, order tracking, and inventory visibility were rebuilt with APIs and modular UI layers—giving the business full control with zero vendor lock-in.
HOW RAPID WAS USED...
"“Growth wasn’t their problem—execution was. RAPID helped us isolate the technical choke points, realign the team, and rebuild fast without disrupting the business.” "
– Ali Davachi, Cognativ Founder
What is the RAPID Framework?
RAPID —Research, Analyze, Plan, Implement, Decide— is Cognativ’s proven methodology for transforming operations at speed. Built over 25 years and detailed in RAPID Transformation: An Outcomes-Based Approach to Drive Results, it brings execution discipline to complex environments—reducing waste and unlocking value fast.
RESULTS OBTAINED
Cognativ stepped in under a virtual CTO model. Using the RAPID framework, we led a full-scale digital transformation—rebuilding the company’s platform from the ground up. The new architecture connected sales, ops, inventory, and customer data across a composable SmartSaaS backbone. As a result, the company increased throughput, boosted average order size, and improved gross margins—all without adding headcount.
Increase in Throughput
Automated pick-pack-ship workflows and warehouse task routing increased order processing speed dramatically.
Increase in Average Order Size
With cleaner product data and real-time availability, reps and systems were able to recommend bundle upgrades and cross-sells.
Gross Margin Lift
Reduced manual labor, fewer order mistakes, and smarter inventory planning all contributed to better profitability.
Platform for Scale
The client now manages all fulfillment operations, pricing, inventory, and customer communication from a centralized system.
IMMEDIATE BENEFITS
- Faster Fulfillment: Automation cut processing time across departments—getting orders out faster.
- Better Sales Enablement: Real-time product availability and pricing rules helped reps close more, faster.
- Cleaner Ops: Teams no longer relied on workarounds or guesswork—reducing error rates and churn.
- Leadership Insight: Executives finally had dashboards that matched real-time ops, not historical summaries.
ONGOING BENEFITS
- The distributor now supports new product lines, more vendors, and custom client workflows—all from one platform.
- Customer onboarding is faster, with client-specific pricing and fulfillment logic built into the UI.
- Inventory forecasting accuracy has increased due to clean, centralized data and historical learning.
- The system continues to evolve with the business—no need for costly rebuilds or risky upgrades.