©2008 Rolls-Royce plc The information in this document is the property of Rolls-Royce plc and may not be copied or communicated to a third party, or used for any purpose other than that for which it is supplied without the express written consent of Rolls-Royce plc. This information is given in good faith based upon the latest information available to Rolls-Royce plc, no warranty or representation is given concerning such information, which must not be taken as establishing any contractual or other commitment binding upon Rolls-Royce plc or any of its subsidiary or associated companies. Delivering a global SAP instance Challenges and Achievements Dr Jonathan Mitchell Director – Business Process Improvement & Chief Information Officer
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©2008 Rolls-Royce plc
The information in this document is the property of Rolls-Royce plc and may not be copied or communicated to a third party, or used for any purpose
other than that for which it is supplied without the express written consent of Rolls-Royce plc.
This information is given in good faith based upon the latest information available to Rolls-Royce plc, no warranty or representation is given concerning
such information, which must not be taken as establishing any contractual or other commitment binding upon Rolls-Royce plc or any of its subsidiary or
associated companies.
Delivering a global SAP instance
Challenges and Achievements
Dr Jonathan Mitchell
Director – Business Process Improvement & Chief Information Officer
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Agenda
Who are we?
Why did we converge our SAP software systems?
How we did it
Achievements
Challenges and lessons learned
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Rolls-Royce – The Company “Power for land, sea and air”
Turnover £7.4bn ($15bn)
Profit £800m ($1.6bn)
Employees 39,000
Business Units
Civil Aerospace World‟s second largest supplier of jet engines
Defence Aerospace World‟s second largest military engine supplier
Marine World‟s largest supplier to the commercial marine market,
Also strong in Naval marine, including nuclear submarines
Energy Compressors, distributed power generation
Motor Cars These are now manufactured by BMW
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Why did we attempt to converge our SAP software systems?
Historically, Rolls-Royce factories and acquired companies operated
largely independently of one another
This is inefficient.
Convergence is a powerful force which we hoped would lead to:
Creation of a manufacturing network which would better utilise capacity
Adoption of best practices, leading to better performance
Standardisation of processes, resulting in more cost efficient manufacturing
Faster financial reporting, common people processes etc.
Maybe even Enterprise Resource Planning – across the enterprise!
In short, SAP convergence was a platform for globalisation
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Scope
Implementation of a „single‟ instance for:
Manufacturing operations and assembly
Civil Aerospace business
Defence Aerospace business*
Naval Marine and Nuclear Submarines*
Repair and Overhaul business
Energy business
Replacement of legacy warehouse systems in Civil Aerospace
Implementation of HR and Finance shared service instance
* UK and US National Security requirements dictate physical partition of instances
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Scale
24 production instances across 8 templates
Implemented at different times
Separate computers, development and support teams
Processes and SAP configurations developed and maintained independently
Master data (part numbers, vendors, customers, chart of accounts) defined
independently
23,000 SAP users
35 company codes , 160 plants in 8 countries
Majority of SAP components used throughout the template
FI/CO PP PM SD MM WM HR
BW CRM SRM QM PS CS Basis
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How did we do it?
Initiative seen as a process change rather than IT project
Governance
Project management
Skilled personnel
Controlled release
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Process change rather than IT project
In Rolls-Royce implement process change initiatives through the use of competency centres
Engineering Improvement Centre – design better products – faster to market
Manufacturing Centre of Competence – better control of manufacturing complexities
Enterprise Resource Planning Centre of Competence – global supply chain
Services Centre of Competence – maximise aftermarket potential
These groups undertake process design activities
The new processes are then deployed into the organisation. In most cases they are enforced through the use of an information system such as SAP
“Process is the horse and the IT system is the cart”
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Governance
Strong governance was essential
The project was driven hard by the Chief Operating Officer
No tolerance for internal politics
COO assigned senior executives to remove obstacles…
The overall governance board sat on top of several work streams
Each work stream had a strong project board and a set of guiding
principles
The structure and organisation of the project was clear to everyone and
all aspects of the project were tightly aligned to the goals
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Project Management
The Project Managers were drawn from the business not IT
Rolls-Royce is a projects-based company
A jet engine costs £1bn to develop and 12 have been successfully
delivered in the last 10 years to time, budget and specification
Project management generally considered too weak in IT industry
Clear schedules
Very detailed plans, each rolling up into a master schedule
Realistically aggressive planning with zero-tolerance for missing
deadlines
Defined SPOC (Single Point of Contact) for each business. Involve
them fully in the Governance.
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Skills
Business team of up to 300 people
Change Management
Data
Process Design. 300
Rolls-Royce SAP competency centre of 40 based in
Derby, UK - Berlin, Germany
Bristol, UK - Montreal, Canada
Indianapolis, USA
EDS team of up to 250 based on Rolls-Royce sites
SAP application specialists
Computing infrastructure designers
Project team was over 600 people at the peak
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Use of Consultancies and Solutions providers
A single service provider (partner) provides support on SAP
functionalities and integration into the existing template, undertake the
SAP functional design and build and production provide incident support.
They have been involved in all of the previous implementations and flexed
the skilled team globally to cope with the demands of the project.
Very limited use was made of other consultants or solution providers
except to support business based activities i.e. Change Management
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Controlled Release I
Process
We used to do it ‘that way’. Now we do it ‘this way’
Testing
Strong testing methodology with multiple testing cycles
All parties involved, super-users in the middle of everything
Testing NEVER, EVER reduced – it was only allowed to get longer
Data Migration and Dress rehearsals
Data required a lot of cleaning, particularly across geographies
Data integrity was the most difficult issue
Three FULL dress rehearsals for every deployment (parallel shifts,
weekend working etc etc)
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Controlled Release II
Configuration and Coding
Keep it vanilla – customisation required explicit CIO approval
Lift and shift existing code, rather than rewriting
Focus on reducing customisation and bringing to standard
Security
Complications with export control licences needed to be surmounted
DoD and MoD mandated physical separation of certain data
Support
Moved to production support quickly (<6 weeks) for each deployment
In-country support models replaced with a single global model
Implemented a single set of processes, procedures and toolset
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Risks
Civil Aerospace Warehouse
Risks were monumental
Transacts £60m ($120m) of spares each week.
Any failure would result in major worldwide
disruption in air travel…
…and massive financial implications for the company
Convergence program
Poor design or implementation difficulties could now bring virtually our entire business to a halt
Data Integrity
Assuming data was clean when it wasn‟t
Capability
The project demanded highly skilled, highly committed personnel
Later stages were carried out in parallel (Submarines/US manufacturing)
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Phasing
UK Parts Manufacture
UK Civil Aero Assembly
Germany Civil Aero
US & UK Energy
Repair and Overhaul
UK Civil Aero Warehouse
Canada Energy & Overhaul
US manufacture & assembly
UK Nuclear
OverhaulOverhaul
Overhaul Overhaul
Aug 05 „Oxygen‟
Convergence of
repair and overhaul
was executed
independently, then
integrated with the
rest of the business
Mar 07
Jul 07
Sep 07
Oct 06
Capability templates were put in early
which could be exploited by later
businesses in later phases (reuse)
Baseline
established
August 05
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Approach to implementation
FeasibilityStudy
High-level
Design
DetailedDesign
Build TestTrain Users
DataMigration
Dress Rehearsal 1
DataMigration
Dress Rehearsal 2
Go Live
DataMigration
Dress Rehearsal 3
High-level
Design
DetailedDesign
Build TestTrain Users
DataMigration
Dress Rehearsal 1
DataMigration
Dress Rehearsal 2
Go Live
DataMigration
Dress Rehearsal 3
High-level
Design
DetailedDesign
Build TestTrain Users
DataMigration
Dress Rehearsal 1
DataMigration
Dress Rehearsal 2
Go Live
DataMigration
Dress Rehearsal 3
Repair and
Overhaul
Civil Aero
Warehouse
US manufacturing
& assembly
Time
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Beginning State
NT
MachineLink
Firewalls
Firewalls
Unix
R/3 App servers
IPC
sappd0
SAP R/3 4.6c
QMPPMM SD PM
QM
PS
PS
CO
CO FI
FI
PIA for BW
V
E
R
T
E
X
"Z" custom
tables
PACKMASTER
FTP /xfers/interfaces
directories
FTP datasets
Unix
FTP directories
Oracle DBMS
LIMS
UNIX
scripts
BWMQSeriesi2
QI
(LIMS)
MRB client
(Kiosk)
Prod. Order
Confirmation/SFX
(Kiosk)
Rolls-Royce user
GUI access
(non-Kiosk)
Rolls-Royce user
SFX access
SAP
Printing
JetForms
Printing
SAP
printing
JetForms
printing
Firewalls
PDC user
remote access
RR Customer user
remote access
PeopleSoft
to FI
G/L, AP
to CO,PP
Headcount
CATT
ZD010051
RR G/L EDS
Billing
(.xls)
Chase Bank
EA
Intra-project cost
transfers to SAP FI
FD
Time Ticket feed to
SAP FI A/P
GELCO
P-Card
(AmEx)
SR
???
TT
Time Ticket feed to
SAP FI A/P
LP
Project-related data
including MM
movements to WBS
PY
Commercial
requirements
from SAP
SD
Clear
InterCompany
from SAP
SunTrust
WO
Work Orders
In
Out
In &
Out
NT
EDI
(Sterling)VAN
RR "EDI
Customer"
"Flat-File EDI"
RR "Flat-File EDI
Customer"
Exostar
Aviall
Forecast
(.xls)
Aviall
(Parts Distribution
Service Provider)
M
R
B
Rolls-Royce user
(Concessions)
Rolls-Royce user
(Financial)
Other Oracle
tables
Rolls-Royce user
GUI access
(Kiosk only)
NT
Business
Connector
S
F
X
FTZ
US DoD
WAWF
TMX
(3PL)
WorkBook
Artemis
AIRLINE
BUSINESS
COMPAL
PSI
Bridge
SPIDER
COOP
TECH
VET
LOAD SPICE
PD/PDR/
PD2000
ATS
STAR
PSI
Clon
e
AsBuilt
Mech
Log
Book
SERAPH
PRICE
CBM
CODAC
Metaphase
R-2
EXPRESS
FAUST /
ORC
IP
SCAAR
SPIDER
Replacement
PSI
IPC &
Bridge
PS2000
Effectivity &
Interchageability
Statements
ARAMISNEAT
Work
Booking
Monitor
MWC/
WCS
COOP
SAPNET
Demand
Forecast
SFDM
Purchased
Goods
Receipt
Domestic
Stock
Movements
<- Instructions To Pick
-> Despatch Instructions
IDEAS/
BOK
ASC/
QCP
ACR's
<- Selling Prices
-> Lead Times
Spares
Prices
Spareable
Tooling & Pre-1994
Mod kitsSpey
Technical
Data
Spare Part
Information
Spare Part
Information
Spare Part
Information
Current
Orders
BA
Invoicing
Sales
Accounting
Completed SalesSales Invoice
Sales
Invoice
Ledger
Entry
Unprinted
Catalogue
As Built
Configuration
As Built
Configuration Engine Orders
As Despatched
Kit Items
(Build Order Kitting)
DDCASH
Spares
PricesSpares
Prices
FIRS
Sales
Invoice GUARD
EXPOSURE
2
VHOLD
PULSE
NEAT
Audit
Control
NEAT
Tool &
Gauge
Control
ERMS
NEAT
Concession
Control
LIDO/LOLA
Merlin
Import
System
COMET
EPA Mark 4Fleet
Planning
PODS
Business
Evaluation
Model
EPMS
NEAT
Engine
Test
Statistics
RRSPs
Output
Distributio
n
Spares
Sales
Analysis
TOOL£/
TTOOL£
Straight
Build
Rep Sch
Monitor
Rep Sch
Man Hour
Est
Rep Schm
Word
Macros
SSM
ORBIT
GAS
PROVCON CD-ROM
Build
Position
Provisioning Forecast
Bill Of Materials
Completed Sales
Stock &
Revenue
Analysis
Completed Sales
Stock &
Revenue Analysis
Completed Sales
Performance
To Program
Completed
Sales
Supply
Performance
V Stock
Receipt
^ Acknowl.
Reliability &
Maintenance
Cost
Forecasts
Market
Trends
Progress
Man
Hour
Estimates
Schedule
Progress
Build
Events
-> Order data
<- Kit vehicle
ATMS
Built
Amendments
Initial Provisioning
Forecast
Stop
Dates
Candidate SparesInformation
Sales Invoice
Supplier Refund Signal
Engine Program
Amendments
Build
Amendments
Required Assembly
Configuration
Technical
Control
Configuratio
n
In Horizon
Engine
Program
Scheme
ProgressManufact.
Method
<- Stores
Demand
Stock Allocation
->
No Assets
Dates
Spare Part
Information
Print Output
Distribution Reqts
Publications Bill
Of
Materi
al
OMat
Overhaul
Materials
In Load
Unload
Service
Bulletin
Word
Templates
In Load
Engineering Configuration
DISCUS
ASSET
TRACKING
Part No
Data
Part No Data
MovementsPTNO
Config.
PTNO
Config.
Part
Numbers
OSCAR
EParts
CEWSMPL
Data
Engineering Configuration
EXRAMS
Raw Material
Raw
Materia
l
Stocks
DEC
MAINT.
Config.
IMPI/
TBS1
Instrumentation
CITS
Instrumentation
Instrumentation
CASSdrawing
specifications
In Load
Concessions
DB
EDM
VAULTS(data
storage)
DOCUMENTUM(document
management)
MODCOM
P
Cost
Reduction
InitiativeStrategic
Planning
Models
TDMS
TEPOL
Liptons
Unload
COBIS
CTS
Tool
Data
Times
Technical Vetting & Suitable
Alternaives
Metaphase
R-1
Engineering Configuration
Serialised PEST
Coded Config.
Serialised
PEST coded
config.
Devt
Engine
Plan
Devt
Engine
Plan
Build List
Amedments
Engineering
Config
Engineering Program Achievement
EROS
Devt Demand
CS
E Forward Engine Program
US manufacture
& Assembly
UK Civil
Aero Assembly
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End State
SAP ERP Interfaces - After Convergence
SAP
BW
IPM
Assembly
Orders
Finance
S&D
Customer
Interfaces
PM
Quality
Warehouse
Product
Master Data
Purchasing
Manufacture
EDI
SAP
HR
CONVERGED
SAP LANDSCAPE
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Facilities running the Converged SAP template
1. Ansty, Coventry (Energy Operations)
2. Ansty, Coventry, (Aero Repair & Overhaul)
3. Arnstadt, Germany (Aero Repair & Overhaul)
4. Barnoldswick, Lancashire (both manufacturing
facilities)
5. Bristol (Defence manufacturing operations)
6. Bristol (Aero Repair and Overhaul)
7. Chantilly, Virginia, US (US Head Office)
8. Cleveland Ohio, US (Fuel Cells)
9. Dahlewitz, Berlin (Civil Assembly and test)
10. Derby Assembly and Test (Civil Aerospace)
11. Derby Operations - manufacturing (all sites)
12. Derby Raynesway (Submarines)
13. Derby (Aero Repair & Overhaul)
14. Dounreay (Vulcan), Scotland (Submarines)
15. East Kilbride, Scotland, (Repair & Overhaul)
16. Houston, Texas, US (Energy)
17. Hucknall, Nottinghamshire, (Manufacturing Operations)
18. Indianapolis, Indiana, US (Defence & Civil Operations & Assembly)
19. Liverpool (Energy)
20. Loughborough (Fuel Cells)
21. Montreal, Canada (Repair & Overhaul and Energy Assembly)
22. Mount Vernon, Ohio, US (Energy operations & assembly)
23. Oberursel, Germany (Manufacturing operations)
24. Inchinnan, Glasgow (Manufacturing operations)
25. Singapore (Energy)
26. Sunderland (Manufacturing operations)
27. Financial Shared Services, Derby, UK
28. Financial Shared Services, Indianapolis, US
29. HR Shared Services, Jubilee House, Derby
30. HR Shared Services, Chantilly/Indianapolis US
31. Civil Aerospace Warehouse, Derby
32. Defence Aerospace Warehouse, Bristol
May 2008
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Business achievements so far
Successfully transferred production of two engine types from Derby to Berlin
Engines for the Airbus A320 and Regional jets moved to utilise capacity in Berlin
Created space in Derby to allow the Boeing 787 Dreamliner and Airbus A380 to be built
We are now able to „cookie-cut‟ new factories
New repair and overhaul base in Erfurt, Germany brought on stream in 15 weeks
Joint venture with Lufthansa Technik
Single version of truth and single measurement yard-stick.
Some areas which were deemed good were not so-good when the measurements
technique became global
Our overhaul bases are comparing best practice and implementing improvements
Key metrics – standard hours, productivity, throughput, right first time etc.
Now able to simulate production capacity and find optimized values for MRP across the
supply chain.
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Take Home messages – if you are going to try this then…
Senior, highly engaged, sponsorship is vital
Don‟t customize the system
Project management must be utterly ruthless
Make sure the data has complete integrity, then make sure again.
If you have good super-users and lots of them, then you will have a good implementation
Engage and train everyone involved, competency test them and issue licences (which expire if training is not maintained)
Three (not two nor one) full dress rehearsals using live data are necessary
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I wonder what they would have made of it?
© SAP 2008
Access SAPPHIRE '08 Berlin
Online
www.sap.com/emea/sapphire
Watch video recordings, download audio files
in MP3 format, and view the slides from
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