Some 80,000 online customers from throughout Europe, and in particular Germany and Austria, use Cyberport.de to buy high-tech products such as laptops, digital cameras and accessories for Apple Macintosh. This provides a sound business platform for the young Internet company which was founded in 1998 and is headquartered in Dresden. The portfolio of the former Apple Webshop, which initially sold only 50 or so special Mac products, has now grown to more than 8,000 articles and, in addition to computer hardware and software, today also includes entertainment electronics, books and DVD films. The change of direction has been successful. In fiscal 2001, the most successful year in its history to date, the company, in which the Hubert Burda Media Group has a majority shareholding, saw revenues rise by 50 percent to Euro 32.3 million.
CEO Dr. Franz Erath explains the recipe for success: “We know that high-quality service is essential if both new and existing customers are to keep coming back to Cyberport”. Various awards that the company has received for its customer service, product portfolio and user-friendly navigation of the Webshop confirm that it is on the right path.
Equipped for Further Growth with SAP R/3
The rapid growth made by the company meant it had to take appropriate action in areas such as order processing and logistics. The system landscape was made up of various stand-alone solutions that had functioned well in the initial years but were now restricting Cyberport’s growth. The existing IT no longer met the increased requirements in terms of scalability, reliability and order processing speed. The numerous transactions decreased performance levels and goods could no longer be moved quickly to where they were needed. The lack of integration meant that the materials management data had to be transferred to the financial accounting section manually with considerable input. The legacy system was also unable to process complaints.
It was evident that a new system was needed if the company was to continue meeting its customers’ needs and processes were to be optimized. Cyberport was looking to use a powerful software in order to make savings and chart the course towards further growth.
It quickly became clear when searching for a suitable software package that only a high-end system such as SAP R/3 could satisfy the high requirements of the Internet mail-order company. “The decision to opt for SAP R/3 underlines the successful development that Cyberport has made from start-up company to an established online mail-order business”, states CEO Olaf Siegel.
The company chose Burda Systems GmbH for its implementation partner. The system house, which is also part of the Hubert Burda Media group, takes care of all commercial IT applications and desktop services within the Group and is therefore very familiar with Cyberport’s system landscape. However, the factor that finally swung the decision in Burda Systems’ favor was the extensive experience of SAP that it had gathered as a SAP Competence Center of many years’ standing. It also had extensive expertise of linking Internet applications with high-quality back-end applications.
Good Planning is Half the Victory
The project got off the ground at the end of January 2002. The project team, consisting of eight staff from Cyberport and eight from Burda Systems, decided to introduce SAP R/3 using the ASAP method (AcceleratedSAP). An extensive business blueprint preceded the actual implementation of the SAP R/3 functionality for materials management (MM), finances (FI) and sales (SD). The project team took several days to draft different workflows and interface concepts and discuss these in detail.
This involved defining Cyberport’s primary business processes as accurately as possible. First and foremost it was necessary to depict an end-to-end dataflow that extended from the order in the Webshop, which is handled by the company’s own CRM solution Cyberparts, right up to the SAP modules. To ensure speedy delivery, customers’ orders must be posted quickly to SAP R/3 and the tracking numbers returned promptly to the Webshop to enable customers to monitor the status of their order. This required Cyberparts to be linked closely to the SAP system. To avoid shipping mixups and delays, all the necessary documents such as delivery notes, invoices and packing cards must be printed directly at the packaging points. The business blueprint also had to incorporate the linkup of a new warehouse in Heynitz near Dresden and the needs of the complaints department, thereby ensuring the best possible tracking of returns.
System Goes Live in Five Months
The good preparations paid dividends and meant that the project could be concluded in just five months. “We can see time and time again that the implementation work can be cut quite significantly if the project is well thought through and planned meticulously in the business blueprint phase. Short project times are particularly important for small- and medium-sized customers”, explains Josef Ritter, Head of Application Development at Burda Systems.
One of the key goals of the implementation process was to transfer the data from the financial accounting process and just under 70,000 sets of customer master records and some 12,000 sets of article master records from the legacy system to the new ERP environment. The migration work was reduced considerably by using a permanent interface between Cyberparts and SAP in the form of the SAP Business Connector. Within a few days the logistics team had re-labeled and re-posted several thousand inventory articles. SAP R/3 went live on schedule at the start of August 2002. The solution ensures a seamless interplay between SAP, the company’s own CRM solution Cyberparts and the Webshop.
CEO Olaf Siegel is proud of how successful the ambitious project has been: “At the start of the project and shortly before things went live, there was some doubt both internally and externally as to whether this project could be concluded successfully in such a short space of time – particularly since the company’s own project team was very young and had no experience of SAP”. “In taking this move, we also wanted to encourage other smaller companies and recommend them to make the changeover.”
A Positive Outcome
Four months after going live, Cyberport can state that the system – operated by the Burda Group data center in Offenburg – is running smoothly and operation is stable. SAP R/3 creates transparency throughout and provides personnel with an overview of all orders. Precise information about e.g. the order status or shipment provides the call center with a valuable source of assistance in the customer support process. Customers can obtain information as to when the goods were shipped or which products are available immediately or can be supplied later. Service support that has already been provided or is still to be provided can also be tracked quickly. In addition, goods can now be shipped to different addresses on specific dates.
Thanks to the seamless integration of financial and inventory accounting in the goods management process, all procedures can be monitored more or less at the press of a button. Staff are able to post payments faster, more precisely and with greater reliability and data can be analyzed and output automatically.
There has also been a good response from business partners, since suppliers and logistics service providers benefit from the fact that SAP R/3 can optimize cooperation in the logistics chain. Cyberport is also looking to expand the SAP system together with Burda Systems, and is planning, among other things, to add controlling functions.