Published on 11-Jun-2009
Validated on 18 Jul 2013
"Something you often hear is that you need to hire more personnel when you introduce SAP. Not at our company. SAP ERP has made our existing staff even more productive, since most administrative processes are at least 15 percent more efficient due to the integrated system." - Alexandra Czech, Head of Finance and Administration, ACTEGA DS GmbH
ACTEGA DS GmbH
Chemicals & Petroleum
Enterprise Resource Planning, Information Integration, Optimizing IT, Optimizing IT, Transforming Business
IBM Business Partner:
The Bremen based ACTEGA DS GmbH is part of the ACTEGA Coating and Sealants Business Division of the ALTANA AG group. Within this division, the company belongs to the Converting Specialties Business Line, and produces and sells sealants for numerous customers in the packaging industry. The company employs 117 people and generates annual revenues of 45 million Euros.
ACTEGA DS GmbH's existing ERP environment was highly customized and inefficiently integrated – leading to unreliability and low data quality. The company wanted a fresh start with a standardized SAP ERP solution – but managing both technical and cultural change within a tight deadline would be a major challenge.
IBM Global Business Services worked closely with ACTEGA DS GmbH's in-house team to deploy the IBM Chemicals and Petroleum template for SAP ERP 6.0. Rigorous planning and careful project management in line with SAP best practices enabled the company to complete the project and go live within just five months, despite the ambitious ‘Big Bang’ implementation strategy – a unique achievement for this market sector.
Integrated ERP solution simplifies processes, increasing efficiency by 15 percent. Simplified infrastructure reduces IT maintenance workload. Standardized solution provides improved reliability – with zero downtime since go-live. End-user satisfaction has increased by approximately 40 percent, due to more reliable processes. Multi-language implementation should help ACTEGA DS GmbH expand internationally.
Click here for a German version.
Like most modern manufacturing companies, ACTEGA relies on its IT systems to support key processes such as finance, production and inventory management and logistics. The company had deployed a range of systems, heavily customized to align with its existing business processes. However, this high degree of customization made IT maintenance difficult, and the integration between the individual systems was very complex.
“With all the customized functionalities, our IT environment had become complex, and as a result it was error-prone,” explains Alexandra Czech, Head of Finance and Administration at ACTEGA DS GmbH. “We came to realize that instead of altering the software to fit our way of working, a better approach would be to implement a standardized ERP solution and re-engineer our business processes to align them with the best practices embodied in the software.”
ACTEGA DS GmbH decided to implement a fully centralized and integrated SAP ERP solution, covering sales and distribution, production planning, materials management, warehouse management, quality management and maintenance, financial accounting, overhead cost controlling, product costing and profitability analysis processes. The solution would also need to interface with two other key SAP systems: an environmental health and safety application and a human resources system. In addition, mobile scanning for handheld applications have been enabled to improve internal goods movement processes such as goods receipt and process order confirmation.
The ‘Big Bang’ approach
“We wanted a ‘Big Bang’ approach, where all the key systems would be brought online in a single go-live,” comments Alexandra Czech. “But we only had five months to complete the project – so we knew it would be a major challenge. One of the main issues was that since we wanted to implement a standardized version of SAP ERP, without major customization, we would need to make significant changes to our working practices. We needed an experienced partner to help us manage both the technical and cultural aspects of the project.”
ACTEGA DS GmbH considered various partners, and ultimately chose IBM Global Business Services to handle the project from end to end – including everything from solution design through to implementation.
“We wanted a partner that had a sufficiently large pool of skilled consultants, so that if one of the team fell ill, someone else could come and take over,” explains Alexandra Czech. “This was particularly important because of our aggressive five-month deadline. IBM is one of the largest SAP implementation partners, so we were confident that it had the resources and response times to meet our needs.
“Equally, we were very impressed with the IBM team’s project management approach, and the IBM Chemicals and Petroleum template for SAP ERP offered a fast, safe method of implementing the functionality we needed.”
The IBM template builds on the SAP Best Practice for implementation by offering a pre-customized, pre-tested model for companies in the chemicals and petroleum industries. The template accelerates deployment and reduces risk by eliminating custom configuration, and draws on best practices gathered by IBM during previous SAP implementations for other companies in the same sector.
IBM Global Business Services and ACTEGA DS GmbH established a project team under the lead of Alexandra Czech (ACTEGA DS GmbH) and Markus Gerken (IBM) with the strong involvement of the IBM best practice expert for Chemicals, Christine Schmidt. ACTEGA DS GmbH employees who became team members were freed from 85 percent of their day-to-day workload for the duration of the project. The team was assigned its own room, and discussions and team meetings were held every day to ensure good communication between the internal and external stakeholders.
“After the joint project kick-off, the first major task for the team was to perform a full fit-gap analysis, which highlighted areas where the SAP best practice process design and the current working practices were not in alignment, and gave us a blueprint for the project,” explains Alexandra Czech. “In almost every case, except where it was absolutely unavoidable, we elected to alter our way of working rather than customizing the software. To stay consistently aligned with the SAP standard we had to make some brave and unpopular decisions, but in the end our disciplined approach paid dividends.”
The realization was finalized within 4 weeks – which was only possible due to the very restrictive fit-gap approach from IBM. The scope of the implementation followed the best practice in every respect, except for three custom interfaces – to an environmental health and safety system, an HR system, and a scanning system – and a few specific processes in the production pre-staging area. All the other procedures were completely realized in the standard template.
The project team was divided into two parts – the first concerned with the technical aspects of the project, while the second focused on communicating the changes to the business and driving cultural acceptance of the new working practices.
Due to the standardized scope of the implementation, the technical team was able to bypass most of the functional unit testing stage and concentrate on integration testing, which speeded up the implementation considerably. The migration of data was automated using IBM tools, and a complete simulation of the go-live was run before the new systems were put into production.
The second team, which conducted the user training, consisted mainly of in-house staff, with selective external support and assistance. The dedication of this second team was vital to the success of the project, helping the organization manage change effectively.
Meeting the deadline
As a result of the careful planning and disciplined project management of the combined IBM and ACTEGA DS GmbH team, the new SAP ERP solution was fully deployed within the five month deadline. This was a unique achievement for a big-bang implementation of this scale in the chemicals sector.
“We have been living and working with a standardized SAP ERP environment for six months– and it is less than a year since our implementation project began,” says Alexandra Czech. “Moreover, we launched all our core applications in a single go-live, and our staff were trained and ready to serve our customers and produce and deliver on time from day one. Very few other companies in the manufacturing sector would be able to make a similar claim. IBM Global Business Services deserves considerable credit for helping us deploy and adapt to the new system so quickly.”
Reaping the benefits
ACTEGA DS GmbH’s new SAP ERP environment has been live for six months, and the evaluation of business benefits within the company has been very positive.
Alexandra Czech comments: “Something you often hear is that you need to hire more personnel when you introduce SAP. Not at our company. SAP ERP has made our existing staff even more productive, since most administrative processes are at least 15 percent more efficient due to the integrated system.”
Moreover, despite the need to alter many of the company’s working practices, replacing the unreliable legacy applications with a single, standardized SAP application landscape has proved to be very popular with employees. The use of highly integrated standard software means that systemic errors are much less common, and data and information quality have improved – helping staff to work more effectively and eliminating re-work. The staff satisfaction ratings within ACTEGA DS GmbH have risen by around 40 percent as a result of the new solution.
“From an IT perspective, we are very satisfied too,” says Alexandra Czech. “Response times are good, and we have not experienced a single moment’s downtime during working hours since the go-live.”
ACTEGA DS GmbH is keen to leverage the possibilities of the SAP ERP environment to support business growth. The company decided to implement the software in both German and English, to facilitate expansion into English-speaking countries.
“With its strong embodiment of industry best practices and important strategic features like multi-language support, SAP ERP has a key role to play in ACTEGA DS GmbH’s future growth,” concludes Alexandra Czech. “As we increasingly turn our attention to competing effectively in a globalized economy, we need a business platform that can be easily extended into new markets. With support from IBM and SAP, we will be ready to meet these new challenges.”
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