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SAP S/4HANA at JTI: Change as Opportunity

Feature Article | November 30, 2017 by Claudio Brecht Hot Story

Traditionally stable industries are facing important changes and are having to respond with new solutions. Switzerland-based tobacco company JTI has seized this opportunity by moving to SAP S/4HANA.

The tobacco market is evolving as consumer trends move more and more towards e-cigarettes and tobacco vapor products. Elaborate advertising campaigns are also playing an increasingly important role. To enable JTI to respond to these changes, the company has turned its full attention towards digital innovation.

Embracing Digitalization

The owner of global tobacco brands such as Winston, Camel, Mevius, and LD, as well as Logic, an e-cigarette brand, and Ploom, a tobacco vapor brand, JTI is ready to take the next steps. To ensure JTI’s future success, it is essential that it improves more than just the existing reporting.

“For us, digitalization is a golden opportunity to ensure we don’t just become an also-ran, but rather hold onto our leading position within the international market,” says Atiq M. Samad, vice president of IT for Business Platform Modernization at JTI.

For JTI’s Business Platform Modernization program, the need to update its antiquated systems is a welcome opportunity to also initiate a technological business transformation. The program includes a significant transformation in the finance area together with conversion of the SAP ERP system – a hybrid approach that provides the best of the two different worlds: conversion and greenfield. This unique approach may also serve as a showcase for other customers who would like to benefit from SAP S/4HANA Finance innovations but are limited by their historical transactional data.

New software solutions improve market access thanks to additional sales channels, while technologies such as machine learning and predictive analytics open up a world of new possibilities. This namely benefits financial planning and economic forecasting, which will ensure a high level of precision, punctuality, and transparency at JTI.

SAP Digital Business Services Advise Throughout Entire Project Duration

To realize these objectives, JTI quickly decided on SAP. One of the challenges the company faced was the preparation of consolidated reports for all business units – a process that required extensive efforts and was prone to errors on account of the various software solutions involved. As a solution, JTI chose to implement a central SAP-based platform for HR, logistics, finance, and supply chain.

JTI was a pilot customer in the SAP Value Assurance Service Packages for SAP S/4HANA program. The program involves four incremental service packages with various stages of support and services, enabling companies to freely select their desired level of SAP support according to the scope of their transformation project. JTI was impressed by the SAP experts’ deep understanding of the business processes: “We received excellent advice from SAP Digital Business Services. The JTI and SAP team is comprised of best-in-class experts, who guarantee only the very best quality,” says Samad.

Another reason for opting for SAP was the sandbox system, a decoupled testing environment in which business-specific configurations can be tried and tested. This enabled the team during the Discovery phase to quickly and seamlessly develop a prototype for JTI’s digital strategy without disrupting the company’s day-to-day business. A sandbox environment for SAP S/4HANA 1610 is currently in use and a detailed blueprint is being compiled with release of the 1709 version of SAP S/4HANA.

Step by Step Toward Value-Based Processes

The first phase of the transformation was moving the SAP Business Warehouse onto SAP HANA. The company was so pleased with the new solution that they also decided to implement SAP Business Planning and Consolidation which is also based on the in-memory database.

The next step is to introduce SAP S/4HANA in finance. JTI is also not only looking to make changes in IT, but also wants to re-organize their existing operations and processes. Change management in the respective departments will play a crucial role in the overall success of JTI’s efforts. In addition to the integration of supply chain and logistics into the new IT platform, JTI will also implement cloud-based SAP SuccessFactors to manage HR processes and Concur for travel management.

“We see JTI as a true role model embracing SAP innovations to drive the digital transformation,” said Roman Ganrio, head of Services Sales, Middle & Eastern Europe, SAP. “We are proud that JTI has chosen SAP Digital Business Services to accompany them on their journey, based on a long-term engagement built on trust and a spirit of innovation.”

The ultimate aim of the project is to prepare JTI for the future. Using a standard IT platform will enable the company to better monitor the collection, processing, and quality of data. Coordination efforts will be reduced, so that employees can work more efficiently and operate in real time.

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