“Open-heart surgery” is how Klaus Hellmich, managing director of Actebis Holding, describes the immense project of conversion to SAP R/3 for an extensive company group. “Because a commercial enterprise of our size cannot work in advance to stock up as a production business would,” Hellmich continues, “we need to be able to act and react in real time.”
Since its foundation 17 years ago, the Actebis group has established itself as a successful distributor of IT and telecom solutions in 12 European core markets. Under its house brands Targa and Peacock, the Actebis group produces its own notebooks and desktop PCs. Particularly in this area, the objective was to take into the account the requirements of production control. In addition to its two house brands, the group provides specialty retail partners with over 30,000 products from more than 100 well-known manufacturers. This requires close cooperation with partners; even an outside observer can easily grasp the magnitude of the task to be accomplished.
“Along with our growth and increasing vertical process integration,” Hellmich explains, “the demands placed upon our inventory control system increased as well. Considering the complex processes involved in modern IT and telecom distribution, which also includes the integration of e-commerce and e-business applications, the inventory control system in use throughout our group reached its performance limit at some point.” Too many special solutions and adjustments were required. The number of isolated applications increased drastically, which also caused a dramatic increase of follow-up costs in support.
Detailed Operations Planning
The migration process began with a potential analysis of all business processes, conducted in cooperation with CSC Ploenzke. In addition to the inability to integrate existing systems, the other particular issues included the lack of a central prognosis and planning tool and the lack of a capability for central administration of master data. In addition, communications media such as EDI and the Internet could not be integrated —criteria that rendered the legacy system completely unsuitable for a modern company such as Actebis. Another weak point was the application’s lack of multi-client capability – the inability of the program to represent inter-company processes. Furthermore, the internationally organized company group required multilingual applications.
A team of 20 process managers from all affected user departments worked out 44 core processes and 120 potential opportunities for optimization. The resulting specifications comprised no less than 3,300 functional criteria that represented a mirror image of all mission-critical processes — from the first telephone conversation with a customer to shipping a product — that were to be mapped throughout the enterprise by the new software system.
After a thorough analysis of the solutions available on the market, 23 products made the short list, with the final decision favoring the SAP solution. However, even with a standardized, though flexible solution such as SAP R/3, Actebis had not yet reached its goal. The objective, after all, was also to pull the company’s isolated solutions and data together into an integrated design that includes industry solutions, partner systems, information systems, e-commerce, and logistics. To ensure the functioning of such a complex system, Actebis experts developed an integrative cutover concept for the day the system was to go live. In particular, the concept included a proprietary workflow test system running under Lotus Notes for the more than 2,000 business processes to be tested.
Operating Room: Successful Cutover
Project participants anxiously awaited the day the new SAP solution was slated to go live in daily operations. Actebis followed a detailed plan. In the first phase, the group initially introduced SAP at Actebis Holding and Actebis International Distribution (AID). At these companies, daily business in all process areas from logistics to accounting was switched to SAP in a “big bang.” During phase two, the switchover was performed at Actebis Computer Deutschland, Actebis Austria, Peacock, Viatec, and Actebis-Spezialagentur für Marketing (S.A.M). In January of 2003, Actebis Switzerland made the transition as well. The Actebis Group is currently in the planning phase for switching over additional companies.
The data transferred from the legacy environment comprised a mix of different database systems such as Image, Notes, SQL, and Oracle. The objective was to transfer the information into standardized migration objects before simultaneously importing them all into the SAP R/3 system on the target date. In particular, Actebis’ team of experts also needed to simulate conversion regulations for business reference numbers — such as valuation prices and inventory values — to ensure that the value transition was performed correctly in terms of commercial law and enterprise technology.
A Crucial Point: Assigning Permissions
“In the end, thanks to the comprehensive test runs we had performed, all these processes were relatively easy to integrate,” recalls project manager Walter Schulte-Vennbur, director of European Organization at Actebis. “The emergency teams we had formed as a precaution, which were to support users in the event of any problems, enjoyed a quiet time, even though it naturally took a while for users to become accustomed to the new system and for all processes to run smoothly.” Looking back, implementing the approximately 2,800 processes and process steps — for which each user was assigned an individual permissions and role concept — was a challenge that had initially been underestimated by the participants.
Schulte-Vennbur recalls, “In this case, we weren’t able to use the standard role concept of SAP, because such an accumulation of inter-process activities is a special factor of distribution. The crucial point is not to make the assignment of permissions restrictive, because that prevents processes and information from being utilized specifically during the startup phase. During this time, we needed to handle numerous support inquiries related to permissions settings in a very short time, and to adapt the concept dynamically. At that time, a network of permissions managers at Actebis — with extensive expertise in the processes and SAP functions — had their hands full. Schulte-Vennbur is happy to pass along the lesson Actebis learned from this additional effort: “It’s a good idea to be more generous with permissions from the start, and to group them into organizational areas.”
Reaching the Finish Line
In the end, the new standard software offered exactly the benefits Actebis had hoped for: increased transparency, complete networking of all participating departments, and the ability to handle inter-company processes. Previous processes in inventory management, procurement, and accounting — some of them complex — were optimized. The sales department has online access to all relevant information at any time, and the ability to exchange data in across international borders in more than 30 languages enables significant increases in efficiency.
In particular, partners are provided for as well. “If a specific partner also uses SAP,” Schulte-Vennbur explains, “we can integrate our systems especially quickly. In such a case, data exchange between the two participants takes place via a fully automated XML interface. Our numerous small to mid-sized business partners particularly benefit from this approach: They can be networked to Actebis without any expenditures of their own in terms of programming and connectivity.” At Actebis, the data entered as XML is then transferred to IDocs and processed directly. The conclusion: With SAP R/3, the entire supply chain is integrated. The company group with twelve branch offices throughout Europe now possesses an IT infrastructure that can keep up with the development of a prospering enterprise.