Advantages of SAP

8/2/2019 Advantages of SAP

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Advantages of SAP

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Case study: SAP implementation at Wockhardt

Wockhardt had already deployed ERP systems from Avalon, but was plagued with a numberof challenges but as it went more global, looked for integration across all business functions,

faster information availability, and better control of operations. This case study describeshow SAP implementation solved these problems

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Summary

Name : Wockhardt Ltd Head Office : Mumbai, India

Industry : Life Sciences

Services: Healthcare - Pharmaceutical

Products/Hospitals/Services

Employees : 9,000

Revenue : INR 26 Billion (US$ 650 Million)

Website : www.wockhardt.com

Implementation

Partner : IBM India

Challenges & Opportunities :

Inability to manage rapid business growth due to limitations of existing technology

and software applications.

Difficulty in managing and controlling disparate data

Legal and Management consolidation of distributed systems

Integration of business processes and real-time management

Objectives


2/10

Establish a single, integrated Enterprise

Resource Planning (ERP) solution

Standardise business processes across the organization

Provide a platform for free flow of information and a central data repository

Improve visibility

Why SAP solution

A robust, integrated solution

Functions and Features

Met companys requirements

Positioned for future growth

Global credibility

SAP as a reliable partner

Assured support

Implementation Highlights

Time-frame : 8 months

Top Managements support

Highly dedicated team

Highly successful implementation with a big bang approach in India

Subsequent rollouts to subsidiaries in Europe and US by the Wockhardt In-house team

Benefits

Real-time access to higher quality information

More structured data forming a basis for informed strategic and operational decisions

A consolidated, single view of the business

More efficient working practices, thanks to standardised, integrated businessprocesses

Ability to manage the growing complexity of purchasing processes

Improved inventory management

Better coordination of work across multiple locations

Comprehensive business insight and analysis,

Supporting faster decision-making and tighter control

Support for significant business growth with seamless, quick and easy integration of

newly acquired companies

Enhanced ability to respond flexibly and rapidly to changing market and external

conditions and translate strategy to action Increased employee satisfaction with simple and central access to information and

applications

Existing Environment

Non-integrated, non-SAP systems


3/10

Hardware: IBM P-Series

Operating System: IBM AIX

Database : Oracle 10g

SAP Solutions and Services : SAP ERP, SAP NetWeaver, SAP NetWeaver

Portal, SAP Business Information Ware house,

SAP Solution Manager, a tool found in the SAP

NetWeaver platform

Wockhardt Ltd : SAP ERP Success Story ( in Detail)

SAP takes care of growth at Wockhardt Ltd, a leading player in the global healthcare

market.

Background

Wockhardt Limited is a global pharmaceutical and biotechnology company based in India,

with a strong and growing presence in the worlds leading markets. The company, a leadingplayer in the Healthcare Industry, manufactures and markets formulations,

biopharmaceuticals, nutrition products, vaccines and active pharmaceutical ingredients(APIs). Wockhardt has manufacturing plants in India, United States of America, UK, Ireland,

and France. More than 65 percent of the companys revenue comes from the United Statesof America and Europe.

The Need for SAP

Wockhardt had already deployed ERP systems from Avalon, but was plagued with a number

of challenges. The company was unable to draw a future roadmap and upgrade itstechnology. Consolidation of data across locations was difficult. To add to that, duplication

of work and reconciliation would happen at every stage. Further, the lack of a structuredinformation system led to delayed decision making, and consequently was having a negative

impact on the business. Transparency in processes was essential to make informeddecisions. The company looked for integration across all business functions, faster

information availability, and better control of operations. This prompted Wockhardt to lookfor an alternative enterprise applications solution for its business.

Wockhardt goes global, moreover, Wockhardts strategies are aligned towards being a

significant player in the emerging global biopharmaceuticals market. It has a strong trackrecord in acquisition management, with five successful acquisitions in the European market.The company decided to replace its existing IT landscape with a future-oriented solution

that would be capable of supporting growth and continuous innovation on a global scale.processes was a major reason for introducing SAP solutions. Looking ahead, Wockhardt

determined that the SAP software could scale and adapt to support its continuouslyexpanding global business.

Making the right choice with SAP


4/10

With Wockhardt going global, the need of the hour was a robust IT infrastructure and anefficient information system in place. The company looked for an ERP solution that would: n

Consolidate operations across multiple countries and multiple currencies.

Cater to global business requirements, while handling country specific requirements Introduce best practices of Life Science Industry for all locations Offer a single technology platform and business data analysis capability Provide high level of security, role and authorisation control

The company short listed Oracle and SAP, but found that the SAP solutions were exactly in

line with its requirements. Moreover, SAP ERP has worldwide acceptability with bestpractices. It offers a stable, scalable and proven technology platform, while providing good

support for enhancements, says Suresh Shenoy, Senior Vice President IT, WockhardtLimited. The company was impressed with the solutions enhanced features and future

roadmap about new technology and product enhancements.

Implementation

IBM India was chosen as the implementation partner for the project since they had had therequisite experience in the Pharma domain. The implementation which was started in May

2005 took around eight months to be completed. The triedand- tested ASAP methodologywas deployed to streamline tasks

All said and done, it has been a satisfying implementation, says Shenoy. The criticalsuccess factors were a strong in-house team, management support, and of course, the right

software. Today, there are satisfied SAP users in Wockhardt.

The modules implemented include:

Materials Management (MM) Production Planning (PP) Quality Management (QM) Plant Maintenance (PM) Sales & Distribution (SD) Customer Service (CS) Human Resources (HR) Financials & Controlling (FICO) Product Life Cycle Management (PLM)

The solution has been implemented at the companys sites in India, United States of

America, United Kingdom, Ireland and Switzerland.

Benefits

Pre-implementation, Wockhardts business processes were not integrated and data lacked

consistency and accuracy, which lead ineffective decision-making, lack of flexibility andinefficient use of resources. This resulted in higher incidence of data entry errors, higher

costs of error processing and paperwork.


5/10

Efficiency Improvements

The introduction of an integrated solution across the organisation has brought many

benefits for Wockhardt. A single unified data platform and standardized business processeshave eliminated data entry redundancy and saved valuable data in real-time, which enables

them to execute their tasks more efficiently. While enhancing overall efficiency across the

organisation, the centralized system ensures that information across the business isavailable to management, not just as raw data, but also as detailed reports. Reports can bequickly produced and without logistical headaches. Moreover, access to accurate information

enables the company to evaluate options and make well-informed decisions, on a timelybasis.

Enhanced Visibility

The most striking benefit has been complete visibility leading to better planning and

improved coordination across the organisation. The company enjoys full visibility into stockacross

all its sites. The result is optimised inventory throughout the supply chain and improvedreplenishment planning, with better fill rates and fewer stock outs. A clear picture of the

inventory leads to improved inventory management, while reducing dependency on theemployees to provide the data as and when required. Further, the system takes care of the

processing of purchase orders while reducing the scope for errors and eliminating dataredundancies, leading to significant time savings. An up-to-date, centralised view of

purchasing activities enables the company to make effective management decisions. WithSAP, all business processes are integrated leading to centralized planning, procurement and

payments. The companys sales depots are connected for transactions and reports, whichgives them online visibility of sales and stocks, says Shenoy. Thanks to its new systems,

Wockhardt has access to more accurate facts and figures in real time. Rich reporting and

analysis functionality enables management to identify opportunities and risks that they maynot have otherwise spotted; resulting in increased efficiency. With virtually every business

unit utilizing the solution, information flow and corporate decision making.

Effective Control for the Strategic Direction of Subsidiaries

The companys centralised SAP softwarebased system gives management an effective tool

for the direction and control of its country subsidiaries. SAP ERP supports Wockhardtsgrowth rate and enables fast and smooth integration of newly acquired companies in Europe

and United States of America. Further, the SAP Business Consolidation solutions take care ofconsolidation of different currencies as well as legal reporting requirements.

More Advantages

Shenoy lists out the measurable benefits which the company has experienced following theimplementation of SAP solutions:

Better LIFR (Line Item Fill Rate) Reduced Receivable days: reduced from 120- 150 days to less than 100 days Reduced Credit Returns: A centralized view enables the Company to take care of products which are near expiry dates leading to a reduction

in the number of goods which were being returned.


6/10

Better Purchasing RatesWe have 8 manufacturing plants in India. Earlier, purchasing activities at eachplant would not be done in coordination with other plants. Now, we can transfer

excess material from one plant to another. SAP ERP has brought in betterorganisation and control of our entire business, says Shenoy.

Further, the company is now in a position to negotiate with vendors and enjoys advantagesof making bulk purchases. Integration of heterogeneous systems like EDI (Electronic Data

Interchange), BlackBerry with SAP software: Through EDI, customer orders and invoicescan be integrated. Orders are extracted from the BlackBerry server and generated in SAP,

says Shenoy. Further, the company is now in a position to negotiate with vendors andenjoys advantages of making bulk purchases.

New Capabilities

Integration of heterogeneous systems like EDI (Electronic Data Interchange), BlackBerry

with SAP software: Through EDI, customer orders and invoices can be integrated. Orders

are extracted from the BlackBerry server and generated in SAP, says Shenoy. SAPNetWeaver Portal gives managers fast, user-friendly access to high-quality, consolidatedinformation for tactical and strategic decision-making. It enables simple, secure and

personalised access to information for employees and business partners. Consequently,communication among individual departments works better, while opening up new options

for cross-site collaboration. Access to the Portal helps vendors to plan theiranufacturing/production activities according to the companys requirements.

SAP software enables the company to compete more effectively by giving it increasedflexibility to respond quicker to market opportunities, provide value-added services to its

customers, and change course when necessary.

Moreover, SAP ERP has worldwide acceptability with best practices. It offers a stable,scalable and proven technology platform, while providing good support for enhancements,

says Suresh Shenoy, Senior Vice President IT, Wockhardt Limited.

Future Plans

The company has established a set of standard operating procedures which has resulted in

better control and overview of its business operations. SAP ERP enables Wockhardt tosuccessfully cope with the challenges of the business environment it is operating in. SAP

ERP has proved to be the ideal enterprise resource planning software for the company whichoperates globally across different locations. System that provides the flexibility we need to

meet new challenges and opportunities on a global scale. Most importantly, the currentlandscape allows the company to expand without requiring significant upgrades or

overhauls. We have a core business infrastructure that can grow as we grow,says Shenoy.Wockhardts future plans with SAP include:

SAP Customer Relationship Management (SAP CRM) SAP Supplier Chain Management (SAP SCM) SAP Advanced Planning & Optimization component (APO) Payroll module SAP NetWeaver Exchange Infrastructure (SAP XI)


7/10

SAP NetWeaver component for integration.Company

Name : Wockhardt Limited

Head Office : Mumbai, India

Industry : Life SciencesServices : Healthcare -Pharmaceutical Products/ Hospitals/Services

Employees : 9,000Revenue : INR 26 Billion (US$ 650 Million)

Website: www.wockhardt.comImplementation Partner : IBM India

Challenges & Opportunities

Inability to manage rapid business growth due to limitations of existing technology and

software applications.

Difficulty in managing and controlling disparate data

Legal and Management consolidation of distributed systems Integration of business

processes and real-time management

Objectives

Establish a single, integrated Enterprise Resource Planning ERP) solution Standardizebusiness processes across the organisation

Provide a platform for free flow of information and a central data repository Improve visibility

Why SAP solution

A robust, integrated solution Functions and Features Met companys requirements Positioned for future growth Global credibility SAP as a reliable partner Assured support

SAP Solutions & Services

SAP ERP, SAP NetWeaver, SAP NetWeaver Portal, SAP Business Information Warehouse, SAP Solution Manager, a tool found in the SAP NetWeaver platform

Implementation Highlights


8/10

Time-frame : 8 months Top Managements support Highly dedicated team Highly successful implementation with a big bang approach in India Subsequent rollouts to subsidiaries in Europe & US by the Wockhardt In-house team

Benefits

Real-time access to higher quality information More structured data forming a basisfor informed strategic and operational decisions

A consolidated, single view of the business More efficient working practices, thanks to standardized, integrated business

processes Ability to manage the growing complexity of purchasing processes Improved inventory management Better coordination of work across multiple locations Comprehensive business insight and analysis, supporting faster decision-making and

tighter control Support for significant business growth with seamless, quick and easy integration of

newly acquired companies Enhanced ability to respond flexibly and rapidly to changing market and external

conditions and translate strategy to action Increased employee satisfaction with simple and central access to information and

applicationsExisting Environment

Non-integrated, non-SAP systems Hardware: IBM P-Series Operating System: IBM AIX Database: Oracle 10g

Functionality: The R/3 System offers you a software solution that covers all commercial

processes and transactions commonly occurring in a company or group of companies.

Integration: All work processes within a company or group of companies are linked

through data and functions using the R/3 System.


9/10

User Friendliness: The R/3 System has a uniform graphical user interface for all

application areas.

Individual Solutions: System-controlled customizing procedures allow you to create

solutions from a wide variety of prepared application variants to satisfy individual

requirements.

Flexible Structure: Whether in a departmental organization or on the warehouse or factory

floor, change is the only facet of your business that will not vary. Adaptability must be

universal, and the R/3 Systems flexible structure and extensive integration helps make that

easier.

Enterprise-Wide Integration: SAPs enterprise-wide R/3 System solutions meet the needs

of constantly changing, continually evolving businesses. The R/3 Systems application

components are fully integrated. Transaction-related process chains trigger the next activity

as needed from engineering to materials management, to production planning, to sales and

distribution. The R/3 Systems full integration pulls your enterprise together, promoting data

access, flexibility, and productivity. No other product or suite of products provides the R/3

Systems functional links between processes that multiply the power of each persons work.

Real-Time Information: The R/3 Systems ability to drill down to whatever level of detail

you need is legendary. More than any other product, the R/3 System provides up-to-the-

minute, real-time information wherever and whenever you need it.

Mission-Critical Business Processes: SAP has more than 20 years of experience

designing sophisticated application software for backbone and mission critical business

processes. Nine of the top ten Fortune 500 companies use SAP software. SAP developed

most of the R/3 Systems functionality in close cooperation with these customers.

Consequently, it has integrated the best business practices of the worlds most successful

companies into the R/3 System. The R/3 Systems business processes are flexible,

pragmatic and well documented. Today they form a widely acknowledged standard forBusiness Process Reengineering (BPR).

Best of Breed: Users want standard software as well as standard business processes and

guidance on how to implement them successfully. With the R/3 System you get the best of

breed for all common business processes. You do not need to compromise on flexibility. If

you need or want to fine tune or tailor your R/3 System, the capability is there.


10/10

Enterprise-wide three-tiered architecture: The R/3 System remains the only enterprise-

wide, three-tiered architecture. The R/3 Systems three-tiered client/server architecture

separates the system into areas devoted to database, application functionality, and desktop

presentation. This structure promotes maximum flexibility, freedom of application

component choice and the ability to change and add to the system as your organization

grows. The development of the Internet, including the World-Wide Web, promises to make

dramatic changes in communications between businesses and customers. SAP is working

with several partners to develop enhanced Internet extensions for the R/3 System. For

additional information, see SAPs Web pages at: http://www.ext.sap.com

Concurrent engineering: Concurrent engineering cuts time-to-market by stacking up

business processes whenever functions can take place concurrently rather than

consecutively. The R/3 Systems flexibility and integration help you form the real-time

workflow application links required for concurrent engineering.

Lean Implementation: The R/3 System promotes lean implementation through its modular

structure. By selecting key portions of the R/3 System for first-time implementation, and

minimizing customization, new users bring the full power of the R/3 System to address their

business issues with great speed, at a reasonable cost. Once running, the R/3 System

makes it easy to add more functional pieces. Tools on various system levels allow you to

fine tune all R/3 System functional modules. Gradually adding functionality makes core

solutions available sooner without sacrificing long-term application muscle.

Desktop Integration: Desktop integration in the R/3 System means that whenever you

want data moved into a desktop PC application, it is a mouse-click away. Download or

export a file to your PCs hard drive and then open it in your favorite spreadsheet or word

processor. No awkward or failure-prone communications between hardware or to hinder

hinders your productivity

Online Integrated Graphics: Online integrated graphics in the R/3 System save you time

and effort, while making your information more meaningful. From most locations in the R/3System, you can instantly create full-color 2-D or 3-D graphics from your data. If you

change any data, you can instantly see it affect the graphics you have selected. You can

also use your mouse to change graphics manually.
http://www.ext.sap.com/http://www.ext.sap.com/

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