Co-Operative Bulk Handling slims down costs with mySAP ERP and IBM

Co-Operative Bulk Handling Ltd (CBH), based in Perth, Western Australia, stores, transports and markets more than 10 million tonnes of grain annually, some 40 per cent of Australia’s total production. CBH is controlled by over 5,700 grower-shareholders, and exports around 95 per cent of the grain tonnage it produces to more than 20 countries.

Strategic diversification through corporate acquisitions, development of enhanced services for growers and closer integration with world markets have lead to considerable increases in workload for the IT infrastructure. In parallel with these changes, senior management took the opportunity to review business processes, looking in particular for efficiencies and cost-savings.

Doug Fairall, Manager, IT Operations Services, explains, “With almost 200 grain receival points, twelve administration offices, four ports and 19 million tonnes of total storage capacity, managing the logistics alone is a complex business. We looked to automation wherever possible to increase our efficiency and productivity, to help control staff costs and enhance our ability to respond quickly to customers’ needs.”


Speeding information flow

Following major acquisitions, managers took the opportunity to review general business processes and look for more efficient ways to organise the business.

From 1998, CBH had been using SAP applications 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. Doug Fairall and the team reviewed the total cost of ownership, likely new functionality and workload requirements, and the design of a new IT infrastructure.

“The goal was to increase processing efficiency and response times, laying the foundation for future process improvements, and find ways to include and automate workflow processes. By speeding up the internal information flow, we could exploit existing resources more efficiently by removing delays, and by lessening the administrative workload we could release staff for more productive, customer-facing tasks,” comments Doug Fairall.

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

CBH selected Intel Xeon MP EM64T processor-based IBM eServer xSeries model x366 servers, deploying 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 1TB of physical memory, and or in 32-bit ‘legacy’ mode, with the usual 4GB limit of addressable memory. The EM64T architecture allows multiple 32-bit applications each to access up to 4GB physical memory, delivering significant potential performance improvements.

SAP software has been able for some time to address more than 4GB 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 TotalStorage DS4300 storage system. The IBM DS4300 storage system can scale to more than 33TB physical capacity and provides enterprise-scale capabilities at low total costs of ownership, offering economical and scalable storage for growing application needs.

Daniel Kikalis, Technical Lead, says, “We selected IBM technology as part of a programme of standardisation within the business. With the x366 servers, adding a new SAP application instance is simple, reliable and rapid, and should we experience a failure we can restart applications on a duplicate machine immediately, booting the operating system, running the application and accessing the data on the DS4300. With IBM technologies we are able to reduce our administration and maintenance costs, and provide a more flexible, scalable service to the business users.”


End-to-end process management

CBH originally ran its SAP R/3 applications on IBM AS/400 servers using DB2, and 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 standardising 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.

Alex Ashton, Project Owner for the mySAP ERP implementation, comments, “At the most basic level, on the former system we had transactions that were taking up to 45 minutes to run. On the new IBM systems those same transactions are completed in around five minutes. If you take that 40-minute saving on a per-user basis, you can see the direct benefits that the new SAP and IBM solution can deliver to CBH.

“With mySAP ERP we have the potential to take advantage of automated report generation and delivery, with on-screen acceptance and approval that has embedded workflows. Should a piece of equipment be in a maintenance programme and therefore affect production planning, managers can see the status, approve the necessary actions and make informed decisions without the delays that would occur if we were reliant on paperwork circulating through the company.”


Personal personnel portal

As the migration to the new mySAP ERP software is completed, the CBH team is looking to exploit the portal services available with SAP Netweaver.

For example, CBH personnel will be able to self-serve their personal details, such as address changes and intranet pages, view payroll data and book holiday periods, accessing the personnel application directly. 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.

Alex Ashton concludes, “CBH has set out its strategy in terms of business growth and process re-engineering, and the implementation of mySAP ERP software is a central part of the transformation. The combination of new mySAP ERP software, Intel Xeon processor-based IBM x366 servers and the DS4300 storage system is a key enabler of the next stage in the extension of CBH services and our expansion into new markets.”