The automotive sector can look back on a long tradition of close collaboration when it faces its current challenges. The same holds true in terms of IT integration. In the past, Kongsberg Automotive – a first-tier supplier in Norway– has been operating electronic data interchange (EDI) based upon various internal and heterogeneous external systems (AMTrix, for example) and standalone, primarily non-uniform processes that made enterprise-critical systems increasingly unstable and expensive. Kongsberg incurred extra expense because it lacked an overview of the whole and had to monitor the operating costs of business-critical processes. Every change, every new partner, and every internal system to be connected meant extra effort and costs for implementation and maintenance of a standalone interface to the existing solutions.
To cut costs significantly, reduce the number of systems and interfaces, and make processes more uniform, Kongsberg Automotive decided to set up an integration platform. “As the basis for central organization of its processes and IT infrastructure, the enterprise chose SAP NetWeaver Exchange Infrastructure (SAP NetWeaver XI) in June 2004,” says Per Högberg, IT software and business system manager of Kongsberg Automotive. With this component, SAP provides a comprehensive platform to integrate internal and external applications based on its Enterprise Services Architecture (ESA) blueprint – the most important reason for Kongsberg’s decision. The automotive supplier has also traditionally been oriented toward SAP. By integrating the SAP NetWeaver XI platform, Kongsberg has taken a major step toward consolidating its IT.
Consolidating B2B integration
Around the world, the automotive industry uses standardized and complex communications for data interchange that must be processed by internal systems and exchanged with external partners. Therefore, Kongsberg’s strategy included an important project to exchange electronic messages with customers and support business-to-business (B2B) integration. Kongsberg Automotive works with customers like DAF, Mercedes-Benz, Opel, Peugeot/Citröen, Renault, Saab, Scania, Toyota, Volvo, and Lear Seating.
Kongsberg has established a closed loop to work with its customers. It uses a long-term EDI schedule from customers for its own production planning and forwards the schedule to its suppliers. About two weeks before a shipment, Kongsberg receives an EDI delivery request and executes final adjustments in the production plan. When it sends the goods to customers, it also creates an EDI message to announce the delivery. Customers start the payment process upon goods receipt. The internal SAP solution handles that process without any manual actions, so that Kongsberg can guarantee high-speed processing and minimize the risk of error.
In this context and from a B2B perspective, SAP NetWeaver XI offers:
- A single (EAI) backbone to connect SAP and non-SAP applications securely
- Central monitoring of internal and external processes
- Routing capability
- XML conversion capability
Rapid Go-Live with the Prototype
Because a large number of companies in the automotive industry supply different OEMs with data harmonization, additional SAP NetWeaver XI components are required. Industry-specific B2B integration must cover parameters like part number, delivery time, and quantity. It must also handle packaging and labeling to meet the industry’s needs. To cover these needs, Kongsberg Automotive chose business adapters from Seeburger AG of Bretten, Germany because of the knowledge Seeburger had gained during more than 2,000 projects in the automotive sector. The adapters allow external integration of partners and convert their EDI formats into the required type. The adapters cover all standards used worldwide in the automotive industry – Odette, Edifact, AnsiX12, VDA, and RND, for example. “We made our choice because of the solutions, the expertise in SAP integration, and the great benefits of SAP NetWeaver XI and Seeburger solutions for our processes.” says Högberg.
The first task for Kongsberg Automotive was to transfer the mapping structure of the information flow from the AMTrix system to SAP NetWeaver XI. After some preparation of the basic setup and structure, it took Kongsberg one week to set up communications and to provide the mapping for the delivery schedule to one reference supplier – including testing, product and quality configuration, and going-live. Based upon the experience gained in creating the prototype, Kongsberg will convert the other suppliers and customers within the next six months. Because of the large number of small differences in the various EDI languages, the maps also require a great deal of adjustment. Because the setup and output of the EDI system changes, Kongsberg must also change some settings in its SAP R/3 solution. Moving forward in small steps, party by party, has proven the best way to optimize the work of the integration platform.
Per Högberg is very satisfied with SAP NetWeaver XI combined with certified B2B automotive adapters from Seeburger. The main objective has been achieved and a uniform, central system can now handle all business contacts. Moreover, the local IT team has been relieved of the burden of a number of labor-intensive, thankless tasks and now can handle its core activities better: operating and maintaining business-critical, just-in-time systems. In addition, Kongsberg must maintain only one EDI system with in-house specialists. The specialists are being trained in four one-week workshops. The first is scheduled four months before going-live and the last is scheduled month after the start of production. Kongsberg Automotive is going to profit from its in-house SAP know-how on the long term, and will be able to cut operating costs generated by the external consultancy. SAP NetWeaver XI itself will reduce the TCO of Kongsberg´s EDI tasks by approximately 30%. “We now have one platform for integration, and we will be able to solve all our future integration challenges with it,” concludes Högberg.