Group of companies EFES in Russia manages massive business expansion with SAP and IBM

The Group of companies EFES in Russia (EFES) is a division of international EFES Beer Group (EBG), a subsidiary of the Anadolou Group, one of the largest holding companies in Turkey and is the fifth-largest brewer and bottler in Europe.

The company is one of the leaders in the beer and soft drinks industry in Turkey, Russia, the former Soviet Republics, the Middle East and south-east Europe. EBG commenced its operations in 1969 and now has a sales presence in over 60 countries worldwide with 14 breweries and five malteries in five countries.

EBG operations in Russia began with a single plant in Moscow followed swiftly by operations in Rostov-on-Don, and a purchase of the Ufa-based “Amstar” plant, which was absorbed by the company four months later. In 2006, two beer-brewing plants in Kazan and Novosibirsk were added to Russia’s fast growing EFES group. EBG has a strategic presence in Russia, including five beer-brewing plants and 99 regional representative offices. The company employs over 4,500 people in the Russian Federation.

Managing growth and automation with SAP and IBM

Over the past ten years, EBG has grown extremely rapidly in Russia – and its expansion continues. Equally important, it faces intense competition in the local market, requiring it to operate an agile, streamlined business that can respond rapidly to changing conditions.

This makes the business model very different from that of its parent company in Turkey, which has an overwhelming share of the market and faces only modest competition.

To manage its business, EFES in Russia deployed an SAP® solution that has been strategically developed over the years in order to manage a growing volume of business operations and an increase in the number of concurrent users. For the initial deployment, EFES followed the best practices and standards recommended by SAP wherever possible.

For sales and distribution, EFES was required to make a number of customizations to fit its go-to-market model – but subsequent, more functionally rich, releases of SAP ERP have enabled the company to move back towards the standard functionality. EFES sees a distinct competitive advantage in adopting the standard functionality, because this means that it can benefit from SAP enhancements and can integrate new solutions faster than competitors who have chosen to heavily customize their SAP landscapes.

SAP for customer relationship management

Practically 70 percent of the 3,000 named users for EFES’s SAP Customer Relationship Management (CRM) solution are sales representatives. They are completely mobile, and depend on the ability to send in sales orders and report information to customers via handheld devices. To enable this growing sales force to compete against other vendors and to serve customers efficiently, EFES continually invests in new technology to ensure the performance and availability of its SAP CRM solution.

Dmitry Dmitrakov, IT Architecture and Strategy Manager at EFES Group, says “Our sales representatives physically visit each customer to record their orders using a mobile solution. This automatically synchronizes with the server, launching the entire chain of business processes all the way up to the delivery of the product to the client. The process is much faster and more efficient. However, the more automated processes there are, and the more critical these processes are, the greater is the requirement for a secure, highly available and robust system in order to manage business critical tasks. IBM Power Systems™ servers with SAP software provided the solution we required.”

Locking down security with IBM Tivoli and virtualization technologies

EFES wanted to provide failsafe security, and guarantee that there would never be any downtime or issues of system failure or data loss. By using IBM Tivoli® Storage Manager and IBM DB2®, EFES is in a position to provide a robust and reliable system that is 99.99 percent available.

IBM DB2 offers very close integration with SAP software and advanced data row and index compression features that help to reduce the total cost of operation. Typically, DB2 compression can reduce large data tables by more than 40 percent, offering savings in data storage and backup times, as well as network and compute performance increases. The SAP Cockpit for DB2 allows database administration to take place from within the SAP environment, helping to reduce system administration workload. Autonomic features such as Self-Tuning Memory Management (STMM) automatically optimize DB2 to make best use of available resources, further reducing manual workload and operational costs.

One of the main reasons is IBM’s virtualization technology, which allows the company to manage server resources dynamically by increasing and redistributing capacity depending on its business needs. This has two advantages in that EFES can manage system loads by providing capacity and power where it is needed, distributing resources evenly, and maintain a robust and high-performance system.

Dmitry Dmitrakov explains, “Virtualization with IBM PowerVM® allows us to use a physical server flexibly, adding more application servers that can process different loads at different time periods. We can supply resources to application servers in a flexible manner. Take the SAP ERP system for example – this is not normally very resource-hungry but come the time for accounting reports, the server load shoots up. Thanks to virtualization, we can dynamically allocate resources not used by other systems on the same server to these tasks.”

Evolving the business and IT infrastructure

EFES has grown exponentially since January 2003, when the company data center in Moscow launched its first SAP ERP module based on an IBM platform of three IBM eServer™ pSeries® 660 servers. The IBM SAP solution replaced legacy IT systems and served 50 ERP users at the time. Since then, new IBM servers, disk subsystems and data storage systems have been added on an almost yearly basis to manage the company’s fast-paced business acquisitions and mergers and to ensure smooth running of its business processes.

Dmitry Dmitrakov adds, “In 2006, a project to implement customer relationship management, supply chain management and business intelligence systems was launched, bringing with it significant infrastructure expansion.”

“The applications being used require a three-tiered system architecture: development servers, testing servers, and production servers. As the production servers reached the limits of their computing capabilities, they are shifted to testing and development, and the production environment is reinforced with newer machines. For example, the initially purchased IBM eServer pSeries 660 with RS64 IV 750 MHz RS64 IV CPUs were first replaced by IBM eServer pSeries 630 based on POWER4. Today, we have two IBM Power® 750 servers with POWER7® processors and four IBM Power 550 servers with POWER6® processors.”

For added resilience, EFES has two data centers several kilometers apart, connected by a dedicated fiber-optic link. The Power Systems servers are split equally between the two centers, and EFES uses IBM PowerHA® (formerly HACMP) to create active-active clusters for the SAP landscape. This means that, in the unlikely event of a system failure in one center, the remaining server in the cluster will take over the entire workload with no loss of availability or data. Each set of Power Systems servers is linked to an IBM System Storage® DS5100 array. Data mirroring features enable EFES to copy operational data for backup and application-testing purposes almost without impact on live services, which is very practical from a business perspective.

“The POWER7 processors have delivered a real boost in performance,” says Dmitry Dmitrakov. “Using PowerVM and PowerHA gives us a good combination of flexibility and reliability. We can move a Logical Partition from one server to a more powerful one if demand rises, so we’re able to respond to changing business conditions without any downtime for our users. We face a great deal of competition in the Russian market; being able to adapt rapidly and seamlessly means that we can out-think and out-maneuver our competitors.”

Dynamic growth

The IT infrastructure at EFES group is upgraded almost yearly, due to its rapid business expansion and the fact that it is shifting business critical processes online and developing its information systems quickly. Currently the company is focused on automating sales and distributor relations with plans to further automate its warehouse and logistics processes.

EFES also continually invests in its software landscape – one major new initiative is in the area of warehouse automation, where the company is rolling out new SAP functionality that will use 2D barcodes to speed the flow of goods from the factory to the consumers. EFES is also extending the functionality of the CRM solution to cover not only sales people but also service and marketing teams. This is in recognition of the rich store of data held in the CRM solution, which has great value for decision-making in other parts of the business.

“The SAP solutions give us a complete picture of the logistics chain, and this really helps both in selling product and servicing customers,” says Dmitry Dmitrakov.

He concludes: “Overall the growth and partnership with IBM has been very successful, as it allows us to scale upwards rapidly at reasonable cost while providing highly reliable and available solutions.