SAP at CBH

SAP at CBHERP Case Study

Submitted by

Raj Chavan (09)

Jane D’Souza (14)

Emmanual Karbhari (21)

CASE STUDY:

S.A.P. (System Applications and Products in data processing) at CBH

COMPANY DETAILS:

Company Name : Co-operative Bulk Handling Limited (CBH)

Industry: Wholesale Distribution & Services

Deployment Country: Australia

Company Website: www.cbh.com.au

ABOUT THE COMPANY:

Co-operative bulk handling ltd. (CBH) is one of Australia's leading grain organizations, a co-operative with operations extending along the value chain from grain storage, handling and transport to marketing, shipping and processing.

It is based in Perth, Western Australia, stores, transports and markets more than 10 million tonnes of grain annually, some 40% of Australia’s total production.

CBH is controlled over by 5700 grower shareholders, and exports around 95 percent of the grain tonnage it produces to more than 20 countries.

The Challenge

The CBH Group is based in Western Australia (WA), the country's largest wheat producing state, and is owned and controlled by around 5,700 grower shareholders.

CBH receives, handles, stores and outloads bulk grain at almost 200 receival sites throughout the state's 300,000 km2 grain belt.

CBH's total storage capacity exceeds 19 million tonnes and on average, 10 million tonnes is received from WA's annual harvest.

Around May/June every year the grain growers carry out their sowing operations and provide CBH with their harvest

forecast. These forecasts form the basis for CBH's logistical planning for its infrastructure and for calculating the required capacity for storing the various quantities of grain in the silos.

At harvest time from September through January, farmers deliver their grain to the receival points, where CBH looks after the storage and grain care. CBH assists in matching growers and marketers and also takes care of shipping the grain on behalf of the marketers and the organizations who buy and sell grain. Over 90 percent of the annual harvest is exported.

CBH initially used the Synon development tool for their in-house developed core grain management system, and then called ICoMS (Integrated Commodity Management System). In 1999 this was complemented with a LANSA-based Web self service solution to collect the harvest estimates from the growers.

CBH's business is dynamic and its systems need to be continuously enhanced. In that demanding environment, the Synon development tool started to fall short, as it was lacking in productivity and could only generate character based applications. "We were looking for an up-to-date development environment that was Windows-based and that would allow us to create both rich Windows and Web applications," says Jezz Bennett, Team Leader Design & Application Support, CBH Group. "Another requirement was that we wanted a quicker development life cycle."

LANSA, already used for giving growers Web access, met CBH's requirements for Windows development and deployment, and was elevated to become the strategic choice for developing CBH's core grain handling system. LANSA's productivity through reuse of components in its Repository was also a major contributing factor in this strategic decision.

CBH decided to totally redevelop the existing grain handling system using LANSA, a decision justified with the merger in 2002 between Co-operative Bulk Handling with fellow grower-controlled grain marketing organization, the Grain Pool of Western Australia, now, CBH Grain. This began the transformation of the company into an integrated business focused on delivering growers a greater share of the grain value chain. Consequently CBH needed additional functionality and a more agile system to support its business.

"We were looking for development environment that would allow us to create both rich Windows and Web applications"

Solution and Implementation using

IBM based technology

From 1998, CBH has been using SAP R/3 applications (on IBM AS/400 servers using DB2) for up to 900 users to run the business, combined with specific grain-handling and administrative systems at multiple sites. Since practically all operations touched SAP applications at some point, the company settled on SAP software as one of the strategic foundations for CBH.

The IT team reviewed the total cost of ownership, likely new functionality and workload requirements, and the design of new IT infrastructure with the goal of increasing processing efficiency and response times, laying the foundation for future process improvements, finding way to include and automate workflow processes.

The company also wanted to speed up the internal information flow to exploit existing resources more efficiently by removing delays and, by lessening the administrative workload the employees could be released for doing more productive, customer-facing tasks.

Attracted by the advanced functionality contained in mySAP ERP software, CBH turned to W.J.Moncrieff, an IBM business partner and to IBM itself, to create and delay an IT infrastructure that would meet the company’s flexibility, scalability and cost-efficiency requirement.

CBH selected Intel Xeon MP EM64T processor-based IBM eServer xSeries model x366 servers, developing eight systems to run the new SAP applications and associated database. Chips based on the Intel EM64T architecture can run as true 64-bit processors, addressing up to 1 TB of physical memory, and or in 32-bit ‘legacy’ mode, with the usual 4 GB limit of addressable memory. The EM64T architecture allows multiple 32-bit applications each to access up to 4 GB physical memory, delivering significant potential performance improvements.

SAP software has been able for some time to address more than 4 GB of memory and the Intel EM64T architecture enables the SAP applications to do so on the Intel platform. CBH currently runs in ‘legacy’ mode, but will be able to switch to 64-bit mode if performance requirements increase.

CBH also implemented a new storage area network based around an IBM Total Storage DS4300 storage system. The IBM DS4300 storage system can scale to more than 33 TB physical capacity and provides enterprise scale capabilities at low total costs of ownership, offering economical and scalable storage for growing application needs.

Since R/3 was running on AS/400, the initial challenge was to migrate to the Windows environment. With more than 200 existing IBM Intel based servers already in the business, CBH expects to gain considerable cost benefits by standardizing on a single environment for its main line of business applications. The company now runs or plans to run financials, controlling, human resources, payroll, maintenance, procurement, sales and distribution, and project management applications.

As the migration to the new mySAP ERP software is completed, the CBH team is looking to exploit the doorway services available with SAP Netweaver. Both the IBM x366 servers and DS4300 storage system are ideally suited to this addition of workload, making capacity addition a business –as usual task at cost effective price points. With the mySAP ERP applications, CBH also plans to introduce SAP Netweaver@Business Intelligence, a component of the SAP Netweaver platform.

Solution and Implementation using

LANSA based technology

The IBIS system manages the grower information,

harvest forecasting, intake of grain at the receival points, stock levels, quality control, grain care and transportation.

Using their own team of 6 analysts and assisted by LANSA business partner Lateral WA, CBH set out to redevelop their existing Synon-based grain handling system with LANSA, a large project that would take nearly three years with a team that fluctuated between 6 and 30 staff members and contractors.

The new system, called IBIS (Integrated Business Information System) was implemented in June 2005. It manages the grower information, harvest forecasting, intake of grain at the receival points, stock levels, quality control, grain care and transportation. IBIS has a rich-client user interface and is used by about 750 staff at CBH's corporate office and, through Citrix servers, at CBH's receival points. External parties have access through a LANSA-based Web solution called LoadNet.

IBIS and LoadNet both run on the IBM iSeries platform and integrate with many other systems, mostly through Web services built with LANSA Integrator.

Parties that use LoadNet include growers; advisors who negotiate on behalf of the growers; and marketers who act as agents for the growers and sell the grain to end user companies such as breweries and cereal makers. Transporters use LoadNet to register their trucks for the transport of grain between sites and the ports.

Growers use LoadNet to provide harvest forecasts, register their vehicles and view their load details after delivery at a receival site. The receival sites are highly automated and have computerized weighing and sampling equipment connected to Linux based systems that update the load information in IBIS through Websphere MQ.

Growers can transact through LoadNet, for example sell, transfer or contract their grain. Using Web services, LoadNet integrates with a price discovery application called DailyGrain. Marketers enter the prices that they are willing to pay for certain grains in DailyGrain and growers can upload their deliveries from IBIS through LoadNet into DailyGrain.

Through the LoadNet interface and based on certain parameters, the integrated solution will then suggest the best price offered by a marketer, which the grower can accept or reject.

The actual sales transaction occurs in IBIS where the load is nominated to that marketer. The change in ownership triggers billing procedures that are periodically processed into SAP. Growers can look at their payment details and invoices through LoadNet's interface with SAP, which is based on Web services and SAP XI.

LoadNet also has links to other in-house applications for online contract writing (which allows growers and marketers to arrange contracts) and PayRite where contract information is stored and payments to growers are calculated. LoadNet and PayRite integrate via Web services.

Mark Leigh, Business Alignment Analyst, CBH Group explains, "LoadNet started out as the Web front-end for IBIS, but now it also integrates with several other systems, mostly via LANSA Integrator and Web services. The grower needs only one interface, LoadNet, from which they can see information from multiple systems. The systems behind it are hidden from them."

*****A third party control system manages the movement of grain at the ports and at the MGC (Metro Grain Centre in Forrestfield). IBIS sends reference file information to the control systems such as grain grades and other master data information, and to the ports ship cargo details and owner information. Once the ship has been loaded, the control system passes the loading information back to the Shipping module within IBIS. Flow run data received into IBIS from the control system is also used to match loads in grower receivals. Data exchange is predominantly through Websphere MQ and LANSA Integrator.*****

"The grower needs only one interface, LoadNet, from which they can see information from multiple systems"

Benefits

From Business Point of View

Grain growers provide CBH with their harvest forecast which form the basis for CBH's 

logistical planning for its infrastructure and for calculating the required storage capacity.

A recent example of CBH being able to react swiftly on an opportunity was in 2007 when Australia's government decided to deregulate the grain market and remove the single desk policy for grain exports. CBH Group, its operations arm already being Australia's largest grain bulk handler, has since expanded its CBH Grain marketing arm to become Australia's largest grain exporter. CBH Group's ICT systems went through a major change to support the new business processes.

The systems have introduced some great efficiencies, according to Bennett, such as improved services to growers, marketers and other organizations, more transparent grain prices, more time for marketing decisions and simplified invoicing. In addition, better planning of logistics has resulted in overall efficiencies such as reduced costs and lower freight rates.

Carlie Lakeman, Manager of the Grower Service Centre, still remembers the old ICoMS system and says that the LANSA-based IBIS is a major improvement. "IBIS is a fresh new system that we all had input to during development. It has a productive graphical interface with graphs and maps in addition to the transactional information. The tabs and search facilities make it easy to navigate and you don't have to drill-down deeply to find what you are looking for. We hire casuals to help us during the busy harvest period. They always pick up how to use IBIS very quickly, which shows the system is intuitive, even for newcomers."

Based on comments from growers, Carlie believes the same ease of use is true for LoadNet. "The number of growers using LoadNet increases every year. We encourage their feedback regarding enhancements. Growers are really pleased that enhancements they suggested one season, have already been applied when they logon the next season." Lakeman also finds the integration with other systems very helpful. "Within 15 minutes of the grower delivering grain to a receival site, the load data appears in IBIS. By the time the grower arrives home and calls our Grower Centre, we can answer load-related questions. The growers can of course also lookup load information via LoadNet."

"The system is intuitive, even for newcomers"

From IT Point of View

The tabs and search facilities in the IBIS system make it easy to navigate and you don't have to drill-down deeply 

to find what you are looking for.

CBH reviews its IT architecture every five years and the decision in 2002 to redevelop its core systems with LANSA was not taken lightly, neither was the decision in 2007 to continue using LANSA.

Did LANSA keep its promises? Bennett and Leigh certainly believe so. When asked for some examples of why LANSA is working well for CBH, they mention the following reasons:

"The systems are robust. There have been only two unplanned outages since June 2005. Of course that’s not only thanks to LANSA, it also has a lot to do with the stability of the IBM iSeries platform," says Bennett.

Conclusion"Another reason is the fact that LANSA covers multiple technological paradigms and works across multiple hardware platforms. This allows CBH to use LANSA for rich-client and rich internet applications, and the ability to access multiple database formats on IBM iSeries, Windows and Linux servers. CBH uses LANSA Integrator in a variety of integration scenarios: Web services over HTTP or WebSphere MQ, FTP services and EDI," continues Bennett.

"LANSA has proven its productivity claims. It has a short learning curve. Plus its repository of reusable components saves time as well," according to Leigh.

Leigh notes that the LANSA Repository is also important for the quality and consistency of the applications you build with LANSA, "Consistent reuse of code, business rules and other components is of extreme importance, especially in large applications environments like CBH. Not only from a productivity point of view, but also for quality and consistency where large teams of developers work together at project peak times."

"Last but not least LANSA's development environment is flexible. IBIS and LoadNet are totally developed in LANSA. There was never a reason to have to revert to another tool or language," concludes Leigh.

"LANSA covers multiple technological paradigms and works across multiple hardware platforms"

"IBIS is now nearly six years old," says Bennett. "We are looking at its use both in the medium to longer term. So far IBIS has done extremely well and it has provided us with a system and environment where we are quickly able to react to the ever changing market conditions. At the end of the day it's going to be a business decision whether we will continue with a bespoke solution that can be easily and readily enhanced to give us a competitive edge, or to go with a packaged solution."

CBH has one senior business and two senior systems analysts looking after IBIS and LoadNet and relies on LANSA business partner Lateral WA for development and additional analysis resources. "Lateral has been involved from day one, starting from the first LANSA-based Web application for growers in 1999. Lateral has a core group of six people who are totally familiar with our systems and in peak times they can allocate extra staff. Lateral does most of the IBIS and LoadNet development, including the interfaces to other systems. We have a very good business relationship with them," concludes Bennett.

"So far IBIS has done extremely well, allowing us react quickly to the ever changing market conditions"

CBH after SAP Implementation

Some of the statistics for IBIS and LoadNet include: 1,284 physical files 2,375 logical files 512 trigger functions 2,293 server type functions 2,015 Windows forms 2,429 reusable parts in the LANSA Repository 1.2 million lines of Visual LANSA code 850,000 lines of traditional LANSA RDML code.

CBH production environment runs on an iSeries M50 plus a development machine - Model 520.

Main integration points between the LANSA-based and other systems are: RADAR, 196 Linux based systems for weighing and sampling at

the receival points. SAP on Windows Virtual Machines for Financials, Asset

Management, HR and Payroll. GrainSmart, a grain marketing solution. PayRite, a UNIX-based solution for Grower's contracts and

payments. Control Systems at 4 ports and at the MGC, all Windows based.

CBH uses Aldon's change management tool to move objects through the various partitions as they progress from Development to Production.

About LANSA

LANSA is a leading provider of application development, modernization and integration software. LANSA has invented a software development process that significantly reduces the complexity of building business-oriented, database-centric systems. These are the systems that run the daily operations of small, medium and large organizations in critical areas like enterprise resource planning, financial accounting, sales force automation, supply chain management and e-business. LANSA’s integrated tool set is also the technology foundation for a wide range of business solutions from LANSA and over 300 Business Partners. Established in 1987, LANSA supports thousands of companies around the world with its products and services.

Website: http://www.lansa.com

About Lateral WA

Lateral WA is a LANSA partner located in Perth, Western Australia. It delivers a flexible, creative and cost-effective range of Information Technology and business skills

Website:  www.lateralwa.com.au

Sources

1. Co-operative Bulk Handling Limited (http://www.cbh.com.au)

2. IBM (http://www-306.ibm.com/)

3. Lansa (http://www.lansa.com)