Bauerfeind AG is a mature, tradition-rich company that is growing significantly. It business areas – venology, general orthopedics, foot orthopedics, and prostheses – have long worked independently. Although they target the same groups (medical suppliers, shoe dealers, pharmacies, and physicians), each operating unit within the company had its own sales staff. The owner, Hans B. Bauerfeind, wanted to restructure the company to position it for even more growth. Bauerfeind saw opportunities to make better use of synergies and to improve customer service and customer approaches, especially in sales and service. Customer potential should be exhausted with consistent up-selling and cross-selling. His goal? Individual sales teams should no longer go their own way, but should work in regional, integrated teams to sell the entire product line – from compression hosiery to therapeutic bandages, inserts, and prostheses.
Setting Up a New Organization, Processes, and IT
Bauerfeind first collaborated closely with consultants from axentiv AG to develop a more efficient design for the corporate group’s processes. The design had to maintain the independence of all six subsidiaries. The essential preconditions for the new company model were an ability to be realized optimally with standard software and to integrate all business processes in the new system landscape. In light of this organizational vision and its ability to be realized internationally, Bauerfeind decided on SAP technology in April 2002.
After agreeing on this concept, the former holding company for the group became Bauerfeind AG, which bundled shipments and sales and handled order processing centrally. The subsidiaries were to concentrate on production and development in the future. As a result, the complete range of internal business processes in sales and logistics was oriented to the new organization. “Because we redesigned not only IT, but also the organization and processes at Bauerfeind, we could tune everything so that the standard software from SAP covered our goals optimally,” says Eberhard Hahn, director of IT at Bauerfeind.
Customer Care is the Highest Priority
The support of sales with the help of a software solution to maintain customer relationships and a reorganization of order processing had the highest priority. The goal was for the system to go into production very quickly. mySAP Customer Relationship Management (mySAP CRM) was to replace the internally developed AIDA system that had been in use up until then, various Microsoft Excel workbooks in the office, and card files in the sales office.
Markus Tensing was responsible for the project on the axentiv side. “mySAP CRM was the only reasonable solution. A strategic decision for SAP R/3 as the ERP back end had already been made, so interplay with mySAP CRM guaranteed optimal integration,” he says. To ensure an economical and easily expanded solution over the long term, the company decided to modify the standard SAP product only when necessary.
Bauerfeind wanted to operate mySAP CRM and the new ERP solution based upon SAP R/3 with the same master data from the get go. A refined design first planned this interplay. The company had to answer organizational questions, such as the person responsible for a given process or how to separate the sales teams from each other. During this phase, Bauerfeind also defined a mandatory system for master data, specified number rangers, and synchronized characteristics. For example, each of the operating companies had used different numbering systems for articles in the past. The characteristics structure in SAP R/3 enabled the company to store all information on a given article, which meant that Bauerfeind could be much freer later on when it assigned numbers.
The mySAP CRM solution was to create a 360-degree view of customers for sales and service personnel and to make all relevant information available at the touch of a button. To provide employees with an important orientation, Bauerfeind divided its customers into groups A, B, and C (according to sales revenues) and classified each one by a potential growth rate of 1, 2, and 3.
Training and Error Correction
After a project that lasted only six months, the mySAP CRM solution went live at the beginning of January 2003. The first weeks thereafter were used as a transition period for training. “Naturally, users need some time to be able to work with a new solution without any mistakes,” says Hahn. The project team had already identified and signed up future key users from the various sales teams during the design and test phases. “After the go-live, these users functioned as contact persons in the team,” says Hahn.
The last problems with the solution were eventually resolved. Difficulties developed during initial data transfer to the mobile clients of the sales and service staff at the beginning. Vast quantities of data had to be downloaded from the Sales & Distribution (SD) component of SAP R/3 to the notebook computers of the sales staff via mySAP CRM. Timeouts often shut down connections. “We first had to implement an intelligent sequence control to avoid data blocks and timeouts” explains Hahn. By January 25, all the problems had been resolved and mySAP CRM went into production.
Optimal Supports for Processes in Sales, Marketing, and Service
Today, all the relevant data on business partners, contact persons, schedules, and activities is available on the notebook computers of members of the sales teams with SAP Mobile Sales. Sales personnel complete the notes from their sales visits online, which means that they can use the previously unproductive time between customer visits. To ensure later availability of informative reports, the design phase considered these notes and decided that they should use as much structured data and as few free-text fields as possible.
Bauerfeind also consistently structured customer service according to the principle of “one face to the customer” with a virtual, central call center. Although employees of the call center continue to work at the individual production locations, they are virtually combined into one service center for customers. Bauerfeind customers thus have just one contact point for all information on every Bauerfeind product.
In addition to a better flow of information between its employees and its customers, Bauerfeind also aimed at optimal IT support for its processes in sales, service, and marketing – from order creation to order processing. For example, employees in the office and on the sales force share activity and task management with each other. Scheduling in SAP Mobile Sales is another help. Bauerfeind reduced its process costs with simplified order, delivery, invoice, and travel expense processing.
Measuring and Controlling Sales with mySAP CRM Analytics
In a second upgrade phase that lasted until July 2003, Bauerfeind enhanced its mySAP CRM solution with analytical functions. The goal was to measure sales performance and to control it in the future with key performance indicators (KPIs). Thanks to comprehensive analytical functions, the sales staff at Bauerfeind can now easily recognize how many medical suppliers or orthopedists exist in a region or for each member of the sales staff, how often A-list customers are visited, or what topics have been discussed with customers. All activities – telephone contacts, visits, quotations, and correspondence – can also be analyzed according to customer classification, business partner types, or physician’s specialization. The analytical functions also enable Bauerfeind to evaluate information on revenues and sales from the entire customer and product hierarchy decisively and according to customer. It can then assign the evaluation to employees, teams, and regions.
At the end of the project, Bauerfeind had achieved its goal. The company has a new organization supported by a modern software solution to maintain customer relationships. It has an efficient sales department, and its structure and technology enable it to face any future challenge.