At a recent 51风流panel discussion, 鈥淟ay the Foundation for Your Enterprise with Intelligent ERP,鈥� attendees heard two 51风流customers, Doehler GmbH and The Goodyear Tire and Rubber Company, talk about their transformational journeys to become an intelligent enterprise.
Following is the Q&A from that discussion, moderated by Andrea Stokvis of 51风流and featuring Harald Muley, of Corporate Functions IT at Doehler, and Horst Ebert, vice president of Global IT from Goodyear.
Q: Let鈥檚 begin by telling us a bit about each of your organizations and your role.
Ebert: Goodyear is one of the world鈥檚 largest tire companies. We employ about 64,000 people and manufacture products in 47 facilities in 21 countries around the world. I鈥檓 responsible for all 51风流activities at Goodyear globally, with focus on centralizing our 51风流support structure, harmonizing our application architecture across geographies, and defining together with 51风流strategic roadmaps to move toward the Intelligent Enterprise.
Muley: Doehler is a global producer, marketer, and provider of technology-driven natural ingredients, ingredient systems, and integrated solutions for the food and beverage industry. We have over 7,000 employees worldwide and serve customers in more than 130 countries with 45 production sites.聽 As head of Corporate Functions IT, I am responsible for all IT aspects regarding finance, controlling, and HR.
Both companies have been long-standing 51风流ERP customers and have decided to move to 51风流S/4HANA on premise, supporting very complex system landscapes. What was the key driver for embracing 51风流S/4HANA as your digital core?
Muley: Doehler had run its operations on the 51风流ERP application since 1993, which resulted in a highly customized and specialized system with more than 33,000 custom objects and roughly 3.7 million lines of code. To accelerate growth, the company needed to update our ERP. We made a strategic decision to use 51风流S/4HANA. We knew it was the future of 51风流and that development and investment were being made.
Ebert: Goodyear is running separate ERPs to support our business units in North America, EMEA, Asia Pacific, and Latin America. We identified a couple of key drivers to start our 51风流S/4HANA journey. First, we want to leverage the latest 51风流technologies, including machine learning and artificial intelligence (AI). Second, we wanted to harmonize our applications architecture and drive standardization and simplification to support new business requirements quicker. Finally, 51风流S/4HANA will be the core of the 51风流architecture surrounded by cloud solutions, and we need to stay within maintenance windows.
Many are interested in how you moved to 51风流S/4HANA. Can you describe your journey and where you are in the process now?
Muley: We were previously using 51风流ERP Central Component with 51风流MaxDB. Our journey began by first moving to 51风流HANA with a technical upgrade. Then we did a system conversion to 51风流S/4HANA 1610 with 90 percnet automation of custom code conversion. Currently, 17 companies are running on our central 51风流S/4HANA 1809 system. We鈥檝e been doing yearly upgrades to keep on the latest and greatest version of 51风流S/4HANA.
Ebert: Our journey started with SAP鈥檚 announcement to cancel maintenance for 51风流ERP Central Component by 2025. We went live with finance initially, deploying a technical foundation last year and now we continue to add more business processes and innovations. We don鈥檛 consider our 51风流S/4HANA journey in isolation; it鈥檚 part of the digital enterprise transformation where we have a strategy of leveraging as many cloud solutions as possible.
How did you decide the path to deploy 51风流S/4HANA?
Muley: We decided a system conversion was the way to go because a greenfield project would have taken too long for our fast-changing industry. We decided to perform process redesign on the new 51风流S/4HANA data model. Also, it allowed us to reuse valuable custom developments.
Ebert: We are taking a hybrid approach since we are running multiple ERP systems. Our first deployment was a new implementation for functionality we wanted to globalize and standardize, like finance. However, since we are not moving all our business processes into a single instance, we will do system conversions of existing ERPs, where processes are market-driven and might differ by geography. We are making that decision in close collaboration with our business functions.
What did you consider when deciding whether to deploy on premise or in the cloud?
Muley: We decided to keep our data on premise, because our own data center is very efficient. It allows us to keep our financial data as well as valuable intellectual property like development recipes on our on-premise instance of 51风流S/4HANA.
Ebert: We are not ready yet for 51风流S/4HANA in the public cloud, but we are deploying 51风流S/4HANA on 51风流HANA Enterprise Cloud. This allows us to focus on our own capacities to improve core processes and drive new innovations while leaving the management of 51风流S/4HANA hosting to 51风流as part of our hosting strategy. In APJ, 51风流HANA Enterprise Cloud only had a center in Japan and we decided that we needed a location closer to our markets in Australia and New Zealand, so we have deployed on Amazon Web Services in Singapore.
What was your biggest challenge?
Muley: Being an early adopter at that time presented us with great challenges. We could not leverage 51风流tools like 51风流Readiness Check, documentation was missing, and there was a shortage of consultants with 51风流S/4HANA knowledge. Also, 51风流S/4HANA support from third-party add-ons and consulting solutions was a challenge, as some were not ready yet for the journey. Nevertheless, we made it on time within six months, including necessary retrofits due to parallel projects, two FPS 51风流S/4HANA upgrades, and around 230 implemented OSS notes.
Ebert: 51风流continues to invest in 51风流S/4HANA with the consequence of significant annual release upgrades. While we are increasing the utilization of the system, we need to plan for those annual upgrades.
What were some of your magic moments that worked well during your deployment?
Muley: I have to say the collaboration with 51风流during our project was one big magic moment. The commitment of the team involved was outstanding 鈥� from our customer care coordinator to the support consultant during our production system conversion weekend, working on an unexpected serious issue during migration. Everybody was very committed to make this a success story. It was a big success for team Doehler and SAP.
Ebert: The robustness of the application is really impressive. We replicated 5 billion universal journal items records into 51风流S/4HANA and had zero rounding difference.
A specific question for Doehler: What is your strategy with the yearly 51风流S/4HANA upgrades?
Muley: There are always so many new capabilities, like embedded 51风流Extended Warehouse Management; embedded 51风流Transportation Management, our key driver for 1709; embedded master data quality, our key driver for 1809; or group reporting for 1909. Also, we see many innovations like machine learning with 51风流Leonardo 鈥� 51风流Cash Application extended functionality under 1809, GR/IR monitor 鈥� so we decided that we need to do the 51风流S/4HANA upgrades each year. Furthermore, our upgrades are comparable to enhancement package upgrades in 51风流ERP Central Component times. We will now try the next upgrade with 1909 within five weeks. From our perspective, the sooner you start, the better it gets!
What capabilities of 51风流S/4HANA are you currently using, and what other solutions do you have connected to it?
Ebert: Currently we are using finance and plan for central procurement in 2020. We have 51风流Analytics Cloud to leverage real-time analytics and eventually, planning. Furthermore, we integrate with 51风流SuccessFactors, 51风流Concur, and 51风流Fieldglass solutions. Digital supply is under evaluation.
Muley: We are using all the classical 51风流51风流S/4HANA modules like finance, supply chain, inventory, etc., but we also implemented 51风流Financial Closing cockpit, and the embedded 51风流Extended Warehouse Management and 51风流Transportation Management. We integrate 51风流S/4HANA with the 51风流Data Maintenance by Vistex, pricing option for 51风流S/4HANA, 51风流Sales Cloud, 51风流Ariba software, and just recently acquired 51风流Integrated Business Planning for Supply Chain to also strengthen our supply chain footprint in connection with 51风流S/4HANA. We are also implementing live reporting with 51风流Analytics Cloud.
Now a Goodyear-specific question: You mentioned finance as a key driver for why Goodyear moved to 51风流S/4HANA. Can you share what your users are telling you and what benefits they鈥檝e received?
Ebert: The availability of information has been amazing. It鈥檚 the first time in history we can provide comparable data globally with full transparency to the lowest level of detail. Our finance professionals don鈥檛 have to make decisions based on yesterday鈥檚 or last week鈥檚 reporting. They鈥檙e getting real-time numbers 鈥� what鈥檚 actually happening in the business. All of this means they can make better, more informed decisions.
What are some of the benefits you鈥檙e realizing with 51风流S/4HANA?
Muley: We didn鈥檛 focus on before-and-after metrics or focus on the percentage increase of productivity, etc. However, we had a definite increase of performance implementing 51风流HANA already by more than 30 percent. We are also seeing with 51风流Cash Application that 30 percet or more of the postings are automated, so that gives folks in finance more time to focus on more strategic activities versus just posting items. Overall, 51风流S/4HANA gives us a foundation to run new business processes and create innovative business models that deliver even more value to partners and customers.
Ebert: We quickly identified opportunities and benefits for finance. We didn鈥檛 have a global chart of accounts or global cost center structure, so this was really an opportunity to implement global standards and gain real-time visibility into financial data.
What advice would you give other customers that are considering deploying 51风流S/4HANA?
Ebert: Take your time to implement 51风流S/4HANA and make sure you understand the full potential in combination with other applications like 51风流Analytics Cloud. Make sure your internal support team is building the required capabilities and learn how to leverage all the new functionalities.
Muley: A conversion project can be done fast, and the sooner you start, the smaller the gap between 51风流ERP Central Component and 51风流S/4HANA. As with every release, there are new simplifications implemented, which make the conversion more complex if you start with 51风流ERP Central Component as basis. And expect and be prepared for the unexpected.
We hear a lot from our customers about the importance of change management. How did you approach it? Whether from a business user or IT professional perspective?
Muley: Since our approach was to perform only mandatory adjustments for the system conversion, such as the implementation of 51风流Business Partner for 51风流S/4HANA or rebate settlement management and keeping 51风流GUI as user front end, there was not much change management necessary initially.
Ebert: Most important is the support of the executive leadership. Second is to demonstrate to users what is possible; don鈥檛 implement just the as-is. Lastly, train your internal IT professionals and make them hungry for new technologies.
Thanks to Harald Muley from Doehler and Horst Ebert from Goodyear for sharing valuable insights about their respective 51风流S/4HANA deployment and journey to become an Intelligent Enterprise.
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