SAP ERP: safety not only on the road

Since January 3, 2011. Inter Metal of Inowrocław, a leading manufacturer and supplier of road traffic safety systems, has been working on the system SAP ERP. The 7milowy company (part of the BCC Group, currently All for One Poland), which was an implementation partner in this project, has started SAP in the classic range of functionalities available in SPRINT. The implementation covered the areas of finance, controlling, materials management, sales and distribution, and production planning.

Zdzislaw Wiśniowski, Vice President of the Management Board, Chief Financial Officer at Inter Metal

As Zdzislaw Wiśniowski, Vice President, CFO at Inter Metal, points out, “We chose 7mil as the contractor for the project because of the SAP SPRINT system offered and the approach to implementation. The company’s experience in implementing SAP projects in mid-sized companies helped us avoid crisis situations and consequently unplanned costs. We also wanted to benefit from the proven management standards sewn into the system."

Inter Metal used the best practices contained in SPRINT. Most of the process concepts proposed in SPRINT matched those already in use at the company.

“7mil’s approach to implementation was a worthy alternative for us, as only 20% of the processes in SAP SPRINT needed to be adapted to our business. The remaining 80% matched the processes we had previously developed at Inter Metal. As a result, going into SPRINT significantly reduced our investment in SAP implementation." – Zdzislaw Wiśniowski adds.

The area that lends itself least to standardization is controlling. It must be tailored to the specifics of each enterprise. Another area that required the development of non-standard solutions was accounting for materials entrusted to production.

Inter Metal, in order to secure support in the area of business processes related to controlling and related modules, took advice from an independent expert, Bartosz Tyrała. He advised on the selection of the integrated system and on the later stages of conception and implementation.

Entrusted materials

The Inowrocław factory is the only production plant in the capital group. More than 80% of its production is commissioned by Outimex, the German owner, which is involved in the sale and distribution of road safety barriers in Western European markets. Outimex remains the supplier and owner of raw materials and semi-finished products used in the production process to a large extent.

Thousands of tons of steel is a very high value material. Previously, accounting for entrusted raw materials was carried out in a dedicated application, prepared in accordance with the expectations of the German company. A similar solution was also prepared in the SAP system.

Valuation of all types of materials (raw materials, semi-finished products, finished goods, commodities) is carried out at the level of the detailed material lot. In the case of entrusted materials, zero valuation is adopted for the calculation of the cost of production of the finished product.

In the process of sales made to the Outimex Group, the quantitative consumption of entrusted material indexes is reported for each individual sales invoice. In monthly cycles, a summary statement of the consumption of all entrusted materials is also provided to the owner, which in the case of domestic sales is also the basis for mutual settlements between Outimex and Inter Metal.

Audit, documentation, translation

The implementation project at the Inowrocław plant was closely watched by the German owner. Outimex left its subsidiary a great deal of autonomy when it came to choosing an implementation partner. However, the business relationship between the two companies is very close, so Outimex was vitally interested in the implementation project at Inter Metal.

Particularly in the area of finance, processes were already prepared at the concept stage in terms of their cooperation with the system at Outimex and future financial consolidation.

An independent auditor hired by the parent company was present during the project work. His task was to verify the implementation of the SPRINT system and solution in terms of usability for the parent company, as well as to review and apply the implementation methodology. The result of his work was a positive report on the project for the German company.

The close business relationship between Inter Metal and Outimex resulted in yet another difference of this project compared to other implementations. Since employees of the German headquarters have direct access to Inter Metal’s system, especially in the area of finance and controlling, it was necessary to translate many system objects (chart of accounts, cost locations, fixed asset names, financial statements, etc.) into German.

It is true that SAP is a multilingual system and you can easily select any language of the interface, but the information on the names of individual master data is most often recorded only in user languages.

Due to ownership changes, Inter Metal has to reckon with the need to integrate the system with other solutions used by the new owners. Therefore, great importance was attached to the project documentation during the work.

In addition to the standard one provided as part of the project, detailed documentation of the solution’s configuration was additionally prepared, with a detailed description of each system parameterization screen used by the consultants.

The role of the project manager

Another reason for collecting detailed documentation was Inter Metal’s previous experience with information systems.

Previously, the company used proprietary solutions prepared in-house. As Zdzislaw Wiśniowski says: “From one side it was very convenient. The author of these applications worked at the company for a very long time and knew our business and IT needs inside out. Thanks to this, all changes and adjustments were made exactly according to users’ expectations and in accordance with the company’s interests, quickly and without additional costs. On the other hand, such a situation posed a threat to business security.

A responsibly managed company that gives employment to nearly 200 people cannot depend on the competence of a single employee. SAP is a well-known system in the market. Its position and market share are a guarantee that it will continue to be serviced and developed. And in addition, SAP’s many partners guarantee continued access to competence."

The company’s IT solutions administrator’s good knowledge of the company’s business processes in virtually all its areas was used during the SAP implementation project. At the initial stage, he was the project manager. His knowledge was particularly useful at the concept development stage. The ability to take a holistic view, from the perspective of the company’s interests, rather than from the perspective of individual departments or individual processes, made it possible to optimize the implemented functionalities. In subsequent stages of the project, the role of manager was taken over by the CFO, a member of the company’s board of directors.

Unlike classical implementations, SPRINT projects require less involvement of the client’s employees. However, this rule does not apply to the project manager, whose role is very important. He is not only the company’s liaison with the solution provider, but remains the “face" of the project and the system in the eyes of his colleagues. His knowledge and authority are crucial to the success of the project. That is why it is so important that he is a decision-maker who enjoys the clear support of the management.

It is difficult to send a better signal to the crew if it is a member of the board of directors who performs this function. In addition, thanks to this, project work is going much more smoothly. The determination of Zdzislaw Wiśniowski, project manager, made it possible to carry out the system launch on schedule, despite the enormous amount of work involved in preparing and migrating data to SAP.

SAP without IT

Currently, Inter Metal does not have its own IT department. Daily service and maintenance of computer equipment is handled by an external company. The company uses the SAP system in an outsourcing model, entrusting the hosting and administration of the solution to the BCC Outsourcing Center. After the post-implementation support period, ongoing application service is provided by BCC under a subscription contract.

“The application service contract guarantees us continued access to SAP competence. I’m a realist, and I know that despite training, users will still be getting used to SAP for some time and will certainly need competent support. Besides, there is always something to do in IT systems – we can use the subscription to carry out minor development work. But the most important thing is that the application service is a guarantee for us that in the event of a malfunction, repair work will be undertaken immediately, as this follows from the SLA conditions. Extensive functionality is one thing, but equally important is the guarantee of system stability." – Zdzislaw Wiśniowski emphasizes.