As a globally operating development and system partner for the automotive industry, ZF Sachs offers innovative technology with a tradition going back more than 100 years. With its experience and expertise in the field of driveline and chassis components, the company has enjoyed continuous growth, and now manufacturers or sells its products at 38 locations in 19 countries.
The international organization previously drew up several decentralized sales plans. The two company divisions “Driveline” and “Chassis” carried out planning independently of each other, using different tools. The one division carried out product-driven planning using the Paradox solution, while the other used vehicle-driven planning in an Access database. Data from the subsidiaries was accessed from Excel tables, an extremely time-consuming procedure. The planned/actual comparisons and cross-enterprise applications in particular were highly labor-intensive, because planning data from the various planning tools and actual data from the SAP system needed to be merged.
Wanted: A standardized solution for sales planning
To ease this situation, the enterprise needed a global standard and an integrated solution for sales planning, and therefore decided to implement a planning and simulation application based on the Business Planning and Simulation (BW-BPS) functionality from SAP Business Intelligence. This solution promised optimum integration with the existing system landscape made up of SAP R/3 and SAP Business Information Warehouse (SAP BW), and a pilot project was launched within the ZF Group.
The aim of the new solution was to merge the “Driveline” and “Chassis” divisions in terms of planning, in order to facilitate planned/actual comparisons and cross-enterprise reporting. A further aim was to make the planning data more easily accessible for other departments, such as production, logistics, marketing, and controlling.
The project needed to take account of the different requirements of the international locations – such as different types of currency conversion, different organizations for market processing, or country-specific sales taxes – and find standardized concepts and a common language. “The different company divisions and locations did not merely use different planning tools; in some cases their planning philosophies were also worlds apart,” says Christian Schneider, sales systems and sales planning manager at ZF Sachs AG. For this reason, the main aim at the start of the project was to analyze and merge the existing processes and define standards for the future planning processes.
High quality of data from the very start
The project involved 800,000 material numbers, more than 20,000 finished product numbers, 5,000 ship-to party numbers, and 1,100 customer numbers. Over 20,000 pieces of master data had to be assigned additional attributes, hierarchies, products, and customers, because the master data from the SAP R/3 solution and SAP BW implemented at the start of 2003 was not detailed enough. “The success of the planning system is determined by the quality of data,” states Christian Schneider. “We wanted to have cleanly modeled data from the very start.”
During implementation, the BW-BPS functions were modified to meet the automotive supplier’s particular requirements. Among other things, ZF Sachs wanted a coordinated authorization concept with a corresponding user guide. In addition, the planning of prices and quantities for important customer/material combinations needed to be separated from the planning for other sales such as tool or development revenues. And finally, the company wanted to be able to incorporate market forecasts and sales development figures from a database into its planning figures.
On the advice of the parent company ZF Friedrichshafen, ZF Sachs chose the Saarbrücken-based business consulting firm ORBIS – not just because of positive experiences in past projects and the industry expertise offered by the ORBIS consultants, but “also because of the good first impression that the team made in an introductory workshop,” according to Schneider. The project began in October 2003, and 10 months later the new solution had been installed in all German plants and initial planning activities had been completed successfully.
A single mouse click replaces tiresome spadework
120 planning staff from Sales and Controlling are currently working with the strategic sales plan, which extends over six years and includes a detailed work plan for each month of the current year. The new planning solution makes it possible for prices and sales to be planned with any degree of detail at the different levels of the customer and assembly hierarchy as well as other market segments.
In order to avoid follow-up work and ensure smooth running, all planners have direct access to the information relevant to them, without having to access different sources. In addition to figures from previous years, average prices, and current orders on hand, the planning screens display the forecast vehicle production figures from a marketing database, and the solution calculates delivery shares and quotas. When distributing the annual figures over the planning periods, the software takes account of special periods such as production startup and shutdown, plant holidays, and the group’s calendar.
The conversion and distribution functions carry out the bulk of the calculation work: in top-down planning, delta values resulting from aggregated planning – for example the expected total sales of clutches to a particular customer – are automatically broken down to previously non-manually planned combinations of characteristics, such as the different clutch types and components. If organizational assignments subsequently change, or management adjusts prices and sales quantities, for examples, a click of the mouse is all that’s needed to display the results at every planning level, which saves employees days of spadework.
In line with the ZF Sachs requirements, the ORBIS consultants modified the user interfaces to match the various user levels such as administrator, planner, and “power-planner” with extended authorizations. This ensures a high degree of user-friendliness. For example, planning at the bottom level for individual customers and materials is carried out in Excel-based, Visual Basic supported layouts: as in an Excel file, results are calculated and displayed automatically on input of the data. An authorization concept reduces input errors, and entries can also be easily reversed. A backup and archiving concept provides a safety net for data maintenance.
Following the start-up of productive operation in August 2004, Christian Schneider’s assessment is positive: “Thanks to the new solution, the quality of data is much higher than before, and the source of the figures can be determined at any time. Because all planned and actual figures are now stored centrally in our SAP BW, we have only one global version of the truth, which we can all rely on.” Enterprise-wide reports and planned/actual comparisons can therefore be drawn up easily. In addition, the other company divisions always have access to coordinated sales data, which they can use to determine material, capacity, and personnel requirements in Production Planning, for example, or calculate planning results in Controlling. As Schneider says, this means that the downstream processes are also more transparent.
ZF Sachs and the ORBIS team are currently undertaking measures to make the planning solution even easier to use, by integrating additional functions and enhancements. The international rollout is also on the horizon: once the application has proven successful in Germany, it will be introduced in all the other locations worldwide, one by one.