Standardized Processes Reduce Costs

October 18, 2006 by admin

Increasing efficiency is a top priority in virtually all industry sectors. Important advances are being made in medical technology, particularly in the area of minimally invasive surgery (MIS). Special devices are used to make surgical procedures as gentle as possible, thus reducing the time patients have to spend in hospital, which in turn lowers the cost of treatment.

Keeping track

WORLD OF MEDICINE AG

WORLD OF MEDICINE AG

The international group of companies W.O.M. WORLD OF MEDICINE AG (W.O.M.) is one of the pioneers of MIS technology. This medium-sized company, headquartered in Ludwigsstadt, has achieved a leading position on the market with its medical devices and technology. This is evidenced by the fact that it has been granted more than 40 approvals from the U.S. Food and Drug Association (FDA) and awarded more than 50 patents. W.O.M. has to fulfill very high quality standards to receive approval for new devices as stipulated, for example, in the Medical Devices Act (Medizinproduktegesetz, MPG) in Germany and the FDA in the USA.

Andreas Schröteler

Andreas Schröteler

Andreas Schröteler, Chief Financial Officer at WORLD OF MEDICINE, explains, “We are legally bound to continually monitor the development, production, sale and servicing of medical devices for surgery and of electronic subassemblies and components for medical technology. For liability reasons, we must document all processes in order to be able to trace the production of each batch every step of the way, if required. This requirement makes the business processes in the individual company areas at W.O.M. very complex.

Limits of the previous IT landscape

Previously, W.O.M. mapped its processes in the areas of manufacturing, quality management, financial accounting and service using a software landscape that had grown organically over time. The individual solutions were interlinked via interfaces, which meant that the maintenance workload was high.
Andreas Schröteler sums up the situation, “The previous software landscape was no longer able to support the company strategy.” As a result W.O.M. decided to replace its legacy system with a sustainable corporate solution which, according to Schröteler, “interlinked the individual company areas and largely standardized mapping of the business processes.”

No problems with the tight schedule

After a thorough selection process, W.O.M. decided in favor of the mySAP All-in-One partner solution All for Machine from All for One Systemhaus. W.O.M. chose this software rather than one of the competitors’ products because it best met the company’s requirements for integrated corporate software. Another argument in favor of the solution was the fact that it can be continuously developed based on the latest SAP technology and geared to future needs. W.O.M. chose the SAP Business Partner PlanOrg Informatik, based in Jena, as the implementation partner.
W.O.M. estimated that the implementation project would take six months. The actual implementation phase started at the beginning of 2006. Sven Goldbeck, IT Manager at WORLD OF MEDICINE, was pleased to report that, “despite the tight schedule, we went live as planned on July 3.” Two factors were key to ensuring that the implementation went as planned. First, the IT team at W.O.M. kept to the plan devised at the start of the project and second, the “lean prototyping” procedure developed by PlanOrg made it easier to implement the new solution on time. As part of this plan, customer-specific settings were made at PlanOrg, not at the customer’s site. “This concept meant that we received a solution that was fully tested and ready-to-use,” explains Goldbeck. “It reduced the time required to implement the system and to train key users, who could be shown how to use the system at their workstations.”

Faster business processes, more efficient service

The integrated company software has improved the daily work processes in the individual company areas at W.O.M., from cost accounting, through production and quality management right down to financial accounting.
For example, integration with quality management and customer service means that customer complaints or cases of warranty can be processed efficiently. With the new system, if a customer returns a product, service employees can use the serial numbers stored in the system to identify the batch in question faster than before. The part is then either returned to stock or repaired. Spare parts used for repair are taken from the company’s warehouse and installed, and the repaired product is then delivered to the customer. Stock postings for the returned part and new part, for example, are made automatically using the serial or batch numbers. This eliminates redundancy.
All for Machine enters all parts leaving and entering the warehouse into the accounting system automatically and in real time. “This is a crucial improvement over the previous processes, which sometimes had to be performed manually. It saves us time and money,” stresses Schröteler.

Real time reporting

As a listed company, W.O.M. is obliged to give regular reports. “The SAP-based industry solution provides us with a standard database from the individual company areas,” explains Schröteler. “This solution has simplified work in the controlling department, whose personnel can now access and analyze company data at any time. As a result, we have rapid access to the latest data for internal and external reporting.”
Thanks to the integrated results calculation feature for the various market segments, employees in the controlling department can also access data on sales and costs from a range of perspectives, for example sorted according to customers, products, product groups or countries. As Schröteler explains, “This feature means we are better able in future to estimate business developments, thus increasing the quality of planning scenarios and forecasts.”

Setting the course for the future

In the course of its internationalization strategy, W.O.M. AG also implemented the International Financial Reporting Standard (IFRS) at the end of 2005. This will run alongside the German Commercial Code (Handelsgesetzbuch, HGB) accounting standard. IFRS makes it easier to compare the company with international competitors when competing for tenders. It also helps the company achieve more favorable financial conditions.
Thanks to the integrated profit center calculation, consolidated financial statements can be prepared across all company areas. This option dispenses with the complicated reconciliation processes at the end of an accounting period, which means that results are available more quickly. According to information from the Chief Financial Officer, changing to the mySAP All-in-One solution has certainly paid off. “We have been able to improve our core processes and map them end-to-end. In this way, we have set the course for the future.”

Dr. Andreas Schaffry

Dr. Andreas Schaffry

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