case study molex
TRANSCRIPT
SAP Demand Planning Service SelectWednesday November 3rd 2004
SAP Service SelectFrom SAP Consulting
Greg TombSenior Vice President andGeneral ManagerSAP ConsultingSAP America Inc.
SAP Customer Services Network
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SAP Consulting provides best-in-class services for innovative business and IT solutions, helping our customers to achieve a competitive advantage
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A truly global organizationA network of 9,000+ SAP consultants in more than 50 countries Offering complete, integrated, and consistent business and implementation consultingServices for businesses of any size, geographic scope, or industry
SAP Service Select
SAP Service Select
Innovative Program from SAP ConsultingDeliver value by providing rapid ROI with reduced riskAchieve your business goals within your budgetOfferings include workshops, assessments, and accelerated implementation packagesSpan a variety of mySAP products and industry solutions
SAP Demand Planning Service Select
Chris CutroDirectorSAP ConsultingSAP America Inc.
Dan Ciecko & Mitch ClarkPlatinum Supply Chain ConsultantsSAP ConsultingSAP America Inc.
Agenda
Business Challenges
Demand Planning Service Select
Molex Customer Success Story
The Business Challenges
An effective demand planning and management process can address many current business pain points:
Deterioration in customer service levelsCustomer orders are not filled on time.Production operations have whiplash from constant changes in demand.Fill-rate performance is poor overall.
Decline in return on assets (ROA)There is too much overall inventory.Inventory strategy is not aligned to specific product demand.Inventory turns are slow or deteriorating.Cycle times are not competitive.
Demand Planning Value Proposition
Higher Forecast Accuracy
Improved inventory turns and reduce inventory levelsIncreased order fill rateReduced operating costsImproved customer service levelRapid ROI
Implementation Methodology and Tools
Defined scope, resources and duration based on SAP Best Practices
Documentation
Preconfiguration
Reduced implementation time
Decreased total cost of ownership
Lower risk
SAP Demand Planning Service Select
Demand Planning Service Select
Shorter Time to Value
Business Process Scope
PrepareForecast
Environment
HistoryReview
Generate StatisticalForecast
IncludeMarket
Intelligence
GainConsensus
ReleaseForecast
• Load History
• Generate planningcombinations
• Create/rolltime series
• Generate proportional factors
• Load live cache
• Generate history alerts
• Generate accuracy reports
• Review history alerts
• Smooth abnormal demand
• Load external forecasts
• Review forecast alerts
• Review statistical forecast
• Adjust final forecast
• Review/adjust future prices
• Update total revenue
• Update location splits
• Gather business intelligence
• Generate statistical forecast
• Update total revenue
• Load external forecasts
• Generate forecast reports
• Consensus meeting
• Final adjustments
• Release forecast to production
• Copy forecast to forecast archive
• Prepare for next cycle
Demand Planning Service Offering Deliverables
2 Planning areas
4 Planning books
6 Planning views
41 Advanced macros
7 BW cubes connectivity
15 mass processing processes
10 univariate forecast models
Monthly job execution list
Security
Training documentation
BEX reporting
Implementation methodology
Configuration Documentation
End user work instructions
Power/user configurator
Configuration
Business process
Monthly process schedule
Best practice workshops
Test scripts
Project Time Line and Major Deliverables
PHASE 1
• Install TechnicalEnvironment
• Load template
• Configure Mass Processing Jobs
• Test template
PHASE 2
Review solution withcustomer
Knowledge Transfer
Tailoring of solution
PHASE 3
Conduct End User Training
Final Integration Test
Establish Production System Administration
Establish Production Support Plan
Perform Cutover
PHASE 4
Go-Live
Production Support
Project Conclusion
FUTURE PROJECTS
Realization Final PrepProject Prep Go Live
Project Time Line and Major Deliverables
Project Go-Live in as little as 3 months
1 Project Preparation
2 Realization
3 Final Preparation
4 Go Live and Support
Phase Solution Install & review, Data LoadReview solution, Tailoring of solution, Knowledge transferIntegration Testing, Performance Tuning, End User TrainingProductive System, Value Proposition, Project Review
TimeLine Deliverables
5 days
30 days
20 days
5 days
604 Roles 2.25 Resources
6 Infocubes FI and SD
Productive Environment Sample
Account Teams Need to Evaluate Customer’s fit to SAP’s Demand Planning Service Select
Hardware is available before project begins and is sized to SAP requirements
Software is Onsite
Project Scope is documented and agreed to before project begins
Experienced SAP SCM Resources are engaged in the functional and technical areas
Customer Management Commitment
Customer Resource(s) part of project team and trained
SAP Demand Planning Service Select Key Criteria
SCM: Advanced Planning and Optimization (APO)
SCM250
AdvancedProductionPlanning
5 days SCM260
CapacityPlanning (SAP APO)
2 days
SAPSCM
mySAP Supply Chain Management Solution Overview
3 days
SCM670
Global Availability Check
3 days
SCM612Transportation Planning/Vehicle Scheduling (TP/VS)
3 days
SCM230
Supply Network Planning (SNP)
5 days
SAP01
SAP Overview
3 days
SCM200AdvancedPlanning Overview(SAP APO)
2 days
SCM220
Demand Planning (DP)
3 days
SCM212
Master Data Integration and Supply Chain Modeling
5 days
WNAPBW
APO/BW Integration Workshop
5 days
Go to http://www.sap.com/usa/education to get more information on SCM220
SCM220 focuses on the forecasting and demand planning techniques available in SAP’sAPO solution
SAP Demand Planning Service Select
SPEED & BENEFITS!!
Immediate Integration of Customer DataWorking Model within 5 days of InstallationCustomer RequirementsKey Performance Indicators DefinedLays the foundation for future enhancements & functionality
SAP Demand Planning Service Select Value
Fast ROIReduced Risks and Costs Related to ImplementationQuick WinLeverages Pre-configured business processes Knowledge transfer to customer project team
SAP Demand Planning Service SelectCustomer Success Story
Dave HubertManager of Global Information SystemsMolex Incorporated
Bringing People & Technology Together, Worldwide
Molex
World’s second largest connector company in a $28 billion globalmarketplace.
Headquarters in Lisle, Il. 21,000 Employees.
$2.2 billion in global sales fy ending June 04.
NASDAQ 100 and S&P 500 index (MOLX).
55 manufacturing facilities in 19 countries.
27 product design groups in 15 countries.
More than 48,000 part #s shipped each quarter to 16000 customerlocations in over 70 countries.
www.molex.com.
Major Markets
10-year comparisonFY94
Other9%
Home Entertainment /
Appliance33%
Automotive12%
Computer /Business Equipment
39%
Other4%
Telecommunications20%
Consumer21%
Automotive17%
Computer29%
FY04
Industrial9%
Telecommunications 8%
Americas 31%Americas 31%
Europe 17%Europe 17%
Far East North 22%Far East North 22%
Far East South 26%Far East South 26%
Molex Sales by Region
Global Manufacturing & Distribution Locations and SAP
AustraliaBrazil (2) SAP04Canada SAP99China (6) SAP98-02France SAP05Germany SAP02India (4) SAP03Ireland (3) SAP97Italy SAP 00Japan (7) SAP99Korea (3) SAP02
Malaysia SAP 98Mexico (2) SAP 98,01Netherlands SAP 98Poland (2)Portugal SAP 05Singapore SAP 96Slovakia (2) SAP 01Taiwan SAP 97Thailand SAP 99United States (15)
SAP 98-02
SAP Scope of Implementation
Single instance of R/3 plus BW ,CRM, APO Solution Manager and limited Portal:
Initial go-live in February, 1996 , since then over 45 plant/warehouses, 17 functioning sales org companies in 16 countries, 50 or more sales offices access from over 30 countries, using all SAP modules. 10 years with SAP anniversary in August, 2004.
Over 1800 concurrent of 8000 users 7X24, 2 million + transactions per day , over 97% of all Molex sites share this one system of 2TB.
Molex Demand Planning in SAP SOP Flexible Planning System
Molex Demand Planning started more than 7 years ago using SAP SOP Flexible Planning methodology
All 4 Regions were using Flexible Planning by the time we decided to migrate to SAP APO in Mid 2003
SOP Flexible Planning was an elaborate 2 part system:Sales Forecast based on:
• Scheduling Agreements with customers• Manual entries• Bookings history (Statistical model)
Operations Planning:• Takes input from Sales Forecast• Operations planner overrides Sales Forecast and finalizes
MPS requirements before transferring to MRP• Use Long Term MRP to create capacity scenarios and
generate Inter-company requirements
Issues before Migration to APO
POOR System performance: Hugh volume of data (customer/material planning level)Duplicated data storage in separate and different Info Structures by RegionComplicated copy programs to transfer data among Info StructuresCumbersome Macros to handle different forecast inputs –historical data and Customer Scheduling Agreements
Unable to align history with current master data:Caused by limited capability in Navigational Attributes in the Info Structure technology in Flexible Planning
Long processing cycle:Due to poor system performanceCausing tight deadlines every month
Molex Migrated to SAP’s APO Demand Planning Service Select Package - Pilot
In May 2003 Molex engaged SAP on piloting the APO Demand Planning Service Select Package
The Service Select Package is configured with standard structures and processes as templates to be readily adapted by most businesses’ demand planning tasks
Molex started the Adaptation process in September 2003 with the help from Dan Ciecko of SAP on his 2 to 3 working days per week schedule
Duplicated and improved on the existing Demand Planning SOP system – workable pilot in 30 days (10-14 consulting plus 1 Molex support person)
Molex Migrated to SAP’s APO Demand Planning Service Select Package
All existing SOP calculation macros were duplicated in APOMacro capability is more powerful and efficient in APO vs. SOP
Monthly planning result is transferred back to R/3 MRP using standard APO program
Inquiries are available in the BW residing in APO
Planning result is also collected in BW for overall reporting
Our APO demand planning system extracts all the necessary data from BW into a single “Combined History” Info Cube and re-aligned with current master data with ease
The data is loaded into 2 sets of Planning Areas:Sales ForecastOperations Planning
Key Benefits with APO
Much improved system performance:Processes used to take days to run can now be done in hoursOff load the burden in R/3 since APO is a stand-alone system, both hardware and software
Shortened process cycle time provides planner more time for analysis
Historical data is always aligned with current master data
Uniform data availability for users across all Regions
More powerful macro functionality
Key Benefits of Demand Planning Service Select - Production
Fast Adaptation and ImplementationIt took 40 working days of Dan Ciecko’s available schedule to complete the whole project including recreation of data sets unique to our requirements.APO was fully functional in December 2003 (3 months after the start of Molex Adaptation)
Required limited resourcesOne SAP consultant, 40 days One person in configuration, part-timeOne person in BW interface, occasionalOne person in Basis, occasional*** Molex had the advantage of having a fully functional design in SOP. We saved much time not to have to start from scratch.
Key Benefits of Demand Planning Service Select
No Business Disruption:Very little user training was required because the APO process is almost an exact duplicate of the old SOP system
Lesson learned
For better system performance, construct the info cubes and planning areas with the minimum characteristics necessary for planning. Can report on more selections later in BW.
Use navigation attributes to the fullest extend so data will be aligned with current master data on the fly.
Leave room for extra key figures in the design for future expansion. The small sacrifice in system performance is worth it.
Create individual “specialized” planning books. Don’t try to have a single planning book to do too many things.
Select easy to understand and manageable statistical models.
Get an experienced consultant.
Future Directions in APO
3 out of the 4 Molex Regions have gone live with APO Demand Planning. The remaining one is being convinced to convert. Over 200 users. 17 sales orgs, over 40 plants.
Will upgrade to APO 4.0 early 2005.
Explore the feasibility of implementing other APO functionalities beyond Demand Planning & Vendor Managed Inventory Planning.
Key Contacts
For more information regarding this or other SAP Service Select offerings, please contact the SAP Customer Engagement Manager (CEM)assigned to you.
If you do not know the name of your SAP representative, please send an email with your inquiry and contact information to:
A Customer Engagement Manager (CEM) from SAP will respond to your inquiry.