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Europe-wide centralization and standardization of the supply
chain, cross-country process harmonization, system transformation,
and roll-in of 11 countries into a global SAP group template
Complete business model restructuring: Redesign of company-wide
process and SAP sys-tem landscape supply chain management | SAP
system landscape transformation (SLT)
Corporate Business Solutions
Restructuring at Kemira: A New European Business Model with a
Centralized SAP Platform in 12 Months
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cbs Corporate Business Solutions. The Materna Group Management
Consultancy.
New European Business Model with a Centralized SAP Platform
About Kemira OYJ
Kemira is an international chemi-cals company. Kemira provides
cus-tomers in water-intensive indust-ries with concepts and
solutions to improve water quality and quantity management as well
as energy, wa-ter, and raw material efficiency.
The Kemira Group has over 5,000 employees in 40 countries. In
2010 the Group generated sales of ap-proximately 2.2 billion . Its
head-quarters are in Helsinki, Finland.
The chemicals company Kemira
established a completely new
business model in Europe with
the help of cbs Corporate Busi-
ness Solutions.
The project, completed in the
record time of just one year,
saw the entire reorganization
of organizational structures,
business processes, and the
SAP company platform, with mi-
nimal invasive restructuring du-
ring ongoing daily operations.
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cbs Corporate Business Solutions. The Materna Group Management
Consultancy.
New European Business Model with a Centralized SAP Platform
Initial Situation
The strategy of the Kemira Group a global chemicals com-pany
headquartered in Helsinki, Finland is to focus on serving
water-based industries and munici-pal water treatment. The company
serves customers in water-inten-sive industries in three segments:
Paper, Municipal & Industrial, and Oil & Mining.
In 2009 the chemicals company made the decision to establish a
new, centrlized business model in Europe. A centrlized supply
chain, new shared services, harmonized business processes, together
with a standardized performance ma-nagement and reporting, would be
the cornerstones of a new, corpo-rate business concept deployed for
all countries and units.
This business model was imple-mented within the scope of a
com-prehensive restructuring program. The aim of the NBM (New
Business Model) project was to adapt the organizational structure,
business
processes, and the existing SAP-based system landscape of the
Kemira Group to suit the concepts of the new business model. To
achieve this, an existing global SAP template system had to be
restructured during ongoing ope-rations and 11 countries
incor-porated in this fully redesigned, standardized, harmonized,
and consolidated SAP world. At more or less the same time, three
ad-ditional countries were brought into the new structure of the
new business model as a direct roll-in.
An enormous transformati-on project completed in just 12 months
in collaboration with the consulting partner cbs Corporate Business
Solutions, which, as the main contractor, supported the project
with comprehensive re-structuring consulting.
Departure from Complex Business Structures
Kemira in Europe in 2009: 13 country organizations, 17
ope-rative legal entities that work in
the companys three business seg-ments Paper, Municipal &
Indust-rial, and Oil & Mining to generate 50% of the Groups
sales.
These are decentralized ma-nagement structures arranged
ac-cording to both regions as well as industries (segments),
developed over time, highly local, and fea-turing different process
flows.
But at the same time, Kemira Europe is also a collection of
tight-ly intertwined organizational units interacting with each
other in many ways, with a high throughput of internal goods and
value flows. A spaghetti network of intercompa-ny transactions,
business proces-ses spanning countries, numerous point-to-point
integrated IT pro-cesses, and heterogeneous appli-cation systems,
including SAP as the main software platform.
Customer Statements
Jyrki Mki-Kala, CFO of Kemira: NBM has been such a major
pro-ject and it has involved so many countries and
the outcome has been just great!.
Timo Kokkonen, Project Manager Kemira: Thanks to cbs strong
leadership, established methods, and innovative tools, we succeeded
in delivering on ambitious project plans in a short time and very
economic-ally. Direct quote: This was the best SAP project in the
long history of SAP projects at Kemira.
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cbs Corporate Business Solutions. The Materna Group Management
Consultancy.
New European Business Model with a Centralized SAP Platform
The SAP world has matured over time and now comprises a total of
160 permanent establishments, a fully integrated SAP Business Suite
system landscape with SAP ERP at its center, with over 20 company
codes and around 200 plants, en-hanced by SAP CRM, HR, BI, and
APO.
Kemira in Europe in 2009 is a company organization that
pre-sents many faces to its customers. The market and brand
presence in the countries lacks consistency. Sa-les, distribution,
the supply chain, and customer service are charac-terized by
heterogeneity; there is little unity in the European busi-ness over
the business segments borders.
bility, the company value was to be increased in a sustained
manner.
Changing the Business Model in an Existing, Well Developed
Global SAP Template System
The New Business Model (NBM) project was set up to implement the
new business model. Its aim was to adapt the Kemira Groups
organizational structure, business processes, and SAP-supported IT
system landscape to reflect the transactional and organizational
concepts of the revised model. A comprehensive transformation
project that affected the entire company, almost all functions and
departments, and the IT organiza-tion.
The Project Planning Challenge
To establish the concrete confi-guration of the business model,
it was first necessary to develop the organizational model and
design the European template processes. A key challenge was how to
design and implement a process in an exis-ting global SAP
environment that was already extremely well develo-
Restructuring Establishing a New European Business Model
Kemiras management was resol-ved to take a big step. The
organi-zation and business processes were to be transformed from
the ground up to create more centralized con-trol of the entire
company and achieve overall improvements. The aim was to foster
global company control according to segments and create a
centralized business mo-del for all countries and units. Stab-le,
standardized business processes and clearly defined, harmonized
intercompany processes would un-derpin this new model. The supply
chain would be centralized, shared service functions would be
estab-lished, local production sites and sales units harmonized,
centralized planning and strategy processes, shared business terms
and condi-tions, and a standardized key figure system for
performance manage-ment and management reporting would be
created.
These measures were intended to realize benefits in terms of
ef-ficiency, costs, and revenues in the whole of Europe. There was
to be a new orientation toward profita-
The Project in Numbers
11 Project locations in Europe
17 operative legal entities
160 SAP permanent establish-ments
2,000 end users
Systems affected: ERP, BI, APO, CRM, HR, XI, HFM
Functions affected: Sales, Purchasing, Finance, Cont-rolling,
Plant Maintenance, EH&S, Manufacturing, Authoriza-tions
More than 100 key users
10 cbs consultants in the core team; in total up to 25
consultants involved
Project term: 12 months
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cbs Corporate Business Solutions. The Materna Group Management
Consultancy.
New European Business Model with a Centralized SAP Platform
ped. Which project approach was best suited? The greenfield
ap-proach of building an entirely new system would have meant an
enor-mous amount of work and would have required a long project.
The model would have had to have been established from the ground
up before the 11 countries could have been incorporated. The
exis-ting SAP assets would have remai-ned unused.
Solution Approach: Everything Done by a Deadline - Ready for Use
in a Year
The management consultants at cbs presented an alternative
soluti-on. Using specific methods and cbs own, high-performance
standard tools, it would be possible to carry out a comprehensive
and targeted
transformation of the existing SAP template system and connected
IT landscape (in the form of a brown-field approach). The
restructuring and roll-in of the 11 countries in-
A Comprehensive Restructuring Program
The project requirements went far beyond a purely tech-nical
system landscape trans-formation: Restructuring the existing SAP
platform implied changing the process configura-tion and converting
and harmo-nizing structures and dependent data. High throughput
rates in intercompany business meant ensuring minimum downtime in
achieving the go-live. On top of this came the country roll-ins,
adapting the structures and pro-
cesses there, and migrating and adapting local data.
Therefore, the challenge was to integrate and plan a highly
complex company program with requirements at several levels and
manage its entire executi-on in such a way to ensure that the new
solution could go live at the precise cutover moment. No mean feat,
especially in light of the situational conditions in a company that
had previously been decentralized and closely interwoven.
volved (in the first stage) into the redesigned European
template would go live on a single deadline in the form of a big
bang adoption.
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cbs Corporate Business Solutions. The Materna Group Management
Consultancy.
New European Business Model with a Centralized SAP Platform
Project Timeline
The project was split into de-sign and implementation phases.
The IT design was limited to three months, while organization-al
as-pects were considered beyond this period. Thanks to cbs
comprehen-sive expertise, it was possible to identify the relevant
points at the beginning and schedule decisions accordingly.
In the SAP-related area, the design phase was followed by a
build. In other words, the design was implemented and verified in a
corresponding integration test in the selected countries. After
that, the other countries were handled one by one, taking into
account their country-specific attributes. In the second half of
the project, the main task was to carry out cut-over tests, which
involved rehearsing the implementation and assessing
it in simultaneous tests in all coun-tries. Three of these tests
ensured a seamless go-live at the turn of the year from 2010 to
2011.
Methodology
The extremely high professional, technical, organizational, and
time requirements of the project could only be met using the M-cbs
me-thodology and the technical inno-vations of the SHC Framework, a
standard software solution for SAP system transformations.
Technically achieving such com-plex data changes to new business
processes is, in itself, no trivial mat-ter. And to accomplish this
system transformation in record time and go live with it over a
weekend was in large part possible only because of the use of the
cbs methodology for SAP restructuring projects in
combination with cbs own stan-dard software. With M-cbs and the
cbs SHC Framework, all required business objects and data,
inclu-ding the histories of all SAP mo-dules, were one by one
selectively transferred, converted, and put into production on the
deadline. On time, in scope, and in budget.
Why cbs?
From the very beginning, accor-ding to a later statement from
the chemicals company, cbs was more or less predestined for the
restruc-turing project. We just didnt know it at first. But when we
learned that cbs was intimately acquainted with this type of
business model restruc-ture on an SAP platform, the con-sultants
from Germany had our full attention. They were, quite fran-kly, the
competent restructuring consultants for this complex task the best
ones with the relevant
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cbs Corporate Business Solutions. The Materna Group Management
Consultancy.
New European Business Model with a Centralized SAP Platform
experience at an international level and the comprehensive
expertise to complete the implementation successfully from a single
source.
Indeed, cbs could offer best practices for a quick and
successful implementation on an SAP plat-form: Expert knowledge of
the SAP-specific characteristics of or-ganizational structures and
proces-ses, the methodical competence to master complex projects,
expe-rienced program and project ma-nagers who could lead this kind
of major project while sticking to tight deadlines and budgets and
drive the project both professionally and technically, specific
expertise, and a powerful standard software tool certified by
auditors; an allrounder capable of transforming the sys-tem and
modifying/migrating data.
A further reason why cbs was selected as the partner for
achie-ving success was the methodical approach of minimal invasive
sys-tem restructuring that the compa-ny could offer. This created a
bene-fit for the customer that broke all records at Kemira: by
saving time. Only with this approach was it pos-sible to completely
transform an existing SAP landscape during on-going operations with
roll-ins in 11 countries and achieve a ready-for-use solution
within 12 months.
Why cbs - the deciding cbs success factors for Kemira
The solution offering of comprehensive restructuring consulting,
from designing the business model solution (organi-zational model
and process de-sign as well as SAP development) to technical
implementation at system level
Comprehensive experience with this type of business model
restructure on an SAP platform
Excellent customer references
High cost effectiveness of the cbs offering
Innovative technical possibilities for changing data to the new
business processes with a minimal invasive method
A highly qualified cbs project team with the relevant
experi-ence for this particular type of project.
Outlook
The success of the project is the perfect reason for Kemira to
inclu-de further countries in the New Business Model. cbs continues
to be a successful Kemira partner. Just two months on, on March
1st, 2011, the next three countries were incorporated into the new
business model.
In the first three months of 2011, Kemira, together with cbs,
implemented a standardized ma-nagement information system on the
basis of SAP BusinessObjects. The second phase for this
dash-board-based information system took place in the first half of
2011.
Benefits
Increased profitability through:
1. Greater process compe-tence and efficiency
2. Optimized control of and value creation in compa-ny-wide
material flows (supply chain efficiency)
3. Optimized inventory ma-nagement and reduction of inventory
costs
More efficient use of the companys own capital standardization
of the supply chain
Centralization of certain functions creation of shared service
centers
Standardized view of customers and outward presence toward
customers (one company on the mar-ket) improved customer
service
Pooling of inventories reduction of intercompany
transactions
Standardization of processes
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cbs Corporate Business Solutions The Materna Group Management
Consultancy
Im Breitspiel 19 69126 Heidelberg - Germany T +49 6221 3304-0
[email protected] www.cbs-consulting.com