New Product Introduction FMCG – Project Case Study

Leading International firm that owns many of the world's consumer

product brands in foods, beverages, cleaning agents and personal

care products

Founded: 1930

• Largest conglomerate with interests in foods, personal care, beverages and

cleaning agents

• Third largest consumer goods company in terms of revenue

• Operating companies and factories on every continent

• Over 17,000* SAP users

• Over 165,000 employees in 100 countries

About the Customer

NPI is the process of managing all activities and resources to bring a new product to market that meets customer needs and supports the business goals.

Marketing R&D Supply chain Manufacturing Marketing

Designs Bills of material

Customer needs

Launch plans

Opportunity Product

External

partners

NPI Process

The New Product in this case was a material (SKU) which comprises of the following

Multiple Raw Materials to be sourced from multiple vendors

Semi-finished Materials to be produced in-house at different plants

Finished Product to be sold from multiple selling plants

Packaging Material

Process Flow

Workflow

Define

Project &

Materials

Material

Usage

Analysis

Basic

Attributes

Plant basic

(MRP

WRKschd)

Storage Location

Other plant details

Costing pre-

requesites (BOM, producton

version,

Purch info & src

list, FI/CO)

Cost material/plant

Plant

Status

Review, correct

and approve

Material

determination

Sales Org

Warehouse

Dchain status

Material

Determination

Project

Starter

Workflow structure

Project

Done

Scoping Material Definition Open PlantCosting Open Sales Org

Designed Process Comprises of 5 phases 1. Scoping – define the business requirements

2. Material definition – turn the business requirement into a materials

3. Costing – cost and transfer price the material

4. Open Plant – make the material available for use in the plant

5. Open Sales Org – make the material available to sell

R&D team

Marketing

Shared Service Center

SU Planner – TH

SU Planner – SG

SU Planner – ID

SU Approval – TH

SU Approval – SG

SU Approval – ID

Consolidation & Wait

Purchasing – TH

Purchasing – SG

Purchasing - ID

Sales Plant – TH

Sales Plant – SG Sales Plant – ID

Quality Mgmt – TH

Quality Mgmt – SG

Quality Mgmt – ID

Finance– TH

Finance– ID

Finance – SG

Warehouse – TH

Warehouse – SG

Warehouse – ID

Sales Team – TH

Sales Team– SG

Sales Team– ID

Review Update

Complete

As-Is Process

Top Process Pain Points

• Long Cycle Times

– NPI takes around 3-6 months time creating a huge competitive disadvantage

• Poor Data Quality

– Overhead of a shared service centre to co-ordinate and run human eye based data quality checks

– Leading to 100+ material rejects every month

– Low visibility into the process leading to monitoring challenges

– Costing of materials across countries and departments lead to miscalculation

– Process document integration and Auditing capabilities missing

• Non-uniform process

– Different Countries follow different processes

– Email and telephone based co-ordination

– Inability to quickly adapt new business rules

– User having to work with monolithic MIRO SAP GUI screens and supplement them with excels, mails, calls

Streamlining the NPDI process

Before

Coordinating activities and capturing the

information for a decision point (phase gate

meeting) is mostly manual

From …

After

Explicit process that tracks and manages

decisions, task and deadlines for a decision

point

Project

Manager

Marketing

R&D

Finance

Manufacturing

To…

Powered by

SAP NetWeaver BPM

Project

Manager

Marketing

R&D

Manufacturing Finance

Manage New Product Development (NPD) as a project

Deal with various materials types in a consistent and coordinated way across

the project

Automatically assign tasks only when pre-requisite tasks are completed,

thereby removing the need for individual to monitor that each pre-requisite

task is completed

Remove the co-ordination overhead of costing across countries and entities

Assign tasks to the team or individuals that can action the item, thereby

removing from the process delays associated with individuals managing task

assignment

Remove manual data collection

Ensure that a material is available to procure, make or sell according to

business requirements

Objectives -1

Ensure that the access and authorizations are consistently applied across the

ECC (ERP) and BPM platforms

Impose an order on the process that conformed to the sequencing

requirements of ERP material master creation

Accommodate the country based diversities

Provide the business with a uniform, consistent and generic view of material

master creation that accommodates

• New product development requirements

• Costing orchestration - Plant level

• The variety of business scenarios

• Provide a basis for discussing and structuring the in

country variability

Objectives -2

R&D Team MDM

Country Team

SU Planning

Purchasing & Logistics

Finance

Sales Team

Review & Complete

BPM Orchestrated Process

BPM process brought in better data quality through automatic and manual checks

Unstructured data like documents, memos were integrated with BPM

SLA’s at every task and escalation ensured Process KPIs are met

SOX and other audit compliances during data creation adhered to using BPM

Highly improved Process Visibility

Merged data and process together

Fast, flexible and adaptive process to define data. Users would have spent lot of time defining the data in

MDM whereas using the new process, the data definition was very quick and seamless as BPM system

adopts the process based on few initial inputs

Generated screens did not meet the customer requirements and were very inflexible - Tuples did not

work well

BRMS Rules to enrich data

Improved User Experience

Structured and Unstructured Data Integration

Product Data Creation:

Project Initiation

Basic Data Flow

FICO & Costing Flow

Business Rules:

Actor Determination

Business Rules:

Variant Determination

What was Achieved?

1. New product developments handled as a single unit of change called a

workflow project

2. Each material managed by the workflow with consideration to how it is

dependant on other materials

3. Ensuring correct material views are completed; Few Auto / default values

are pre-filled based on biz rules

4. Issuing tasks in parallel made possible

5. Ensuring the correct team receives a task

6. Ensures that tasks are issued only once the prerequisite tasks have been

completed

7. Ensures that entered data is of a high quality; Validation at source ensures

quality at source (in most cases)

8. Notifications of work via email

9. Accessed via a single point of entry (the universal work list)

10.Most of Sox controls / compliance are supported

20

Implementation Highlights

One of the world’s largest SAP BPM implementations

Number of new Products created per year : 14,400

Total number of BPM users: 800

Process spanning 300+ steps with more than 5000 rules

Number of countries benefited: Initial roll out to 3 countries and 72

more countries in phased manner

Improved the new product development SLA from 10 weeks to less

than 4 weeks

Closed loop feedback mechanism to ensure successful delivery of

data messages.

Enabled real-time process health monitoring

Enhanced collaboration between users through integrated document

management handling.

21

Thank You

Apurva Pandey BPM Solution Architect

Incture Technologies

For any further questions write to me at

apurva.pandey@incture.com