1301 Lessons Learned SAP Sourcing 70 Ramp-Up Implementation at HJ Heinz

8/11/2019 1301 Lessons Learned SAP Sourcing 70 Ramp-Up Implementation at HJ Heinz

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Lessons Learned: SAP Sourcing 7.0 Ramp-Up

Implementation at H.J. Heinz

Bill Durbin and Christopher Yope

[


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Real Experience. Real Advantage.

[ Introduction to Heinz

Founded in 1869 in Pittsburgh, PA by Henry John Heinz

Today, headquartered in Pittsburgh and famous on six continents for itsiconic brands

With products in more than 200 countries around the world, Heinz isthe most global U.S.-based food company

The Heinz brand is a $4+ billion global icon Record Sales of $10.7B+ In FY11

Global Spend of $4.5B+

Key Heinz markets

North America

Europe

Asia Pacific

Rest of World


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[ Leading Heinz Brands Around The World


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[ In This Session

Understand how SAP Sourcing fits into Heinzs Global

Procurement Strategy

Understand the planning and requirements needed to

implement SAP Sourcingon premise

Hear results delivered and benefits obtained by implementing

SAP Sourcing 7

Project Savings Management and Reporting in the tool

Improved contract authoring, management, and reporting

One single source of truth, globally equivalent

Learn best practices when it comes to leveraging Key Users,

global rollouts, and SAP Sourcing administration


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[ Heinzs Path to World Class Procurement

Developed

our

Strategy

Invested in

our People &Processes

Implement ing

the System

Backbone


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[

stablish the Foundation

Platform for uture Growth

Get Capabilities Current with Competition

Globally Upgrade & Integrate Business Processes

Standardize IS Platform in SAP

Drive Visibility, Productivity and Efficiency

What is Keystone?


7/26Real Experience. Real Advantage.

[ How SAP Sourcing Supports the Procure to Pay Process

Keystone Procure to Pay Benefits

Full visibility of spend

Proactive compliance via effective workflow and improved buying tools

Increased buyer effectiveness through touch less PtP transactions

Common and measurable global PtP process

Platform to enable global sourcing

Standard global metrics and reporting

Establish Business

Requirement

Develop

Sourcing

Strategy

Negotiations /

Contracting Place OrdersReceive Goods

/ ServicesPay Supplier

Manage / Continuously Improve

Supplier Relationship

SAP Sourcing



[ Keystone Global Implementations

ECC

Direct Procurement

SRM

Indirect Procurement

E-SourcingSourcing, Projects and Contracting

US,

Europe

Continental

Europe

North America, Europe, India

Indonesia, China, Australia, New Zealand



[ SAP Sourcing Scenarios and Landscape Business Scenarios Implemented:

RFI

RFP

RFQ

Auctions

Project Management

Savings Tracking

Contract Lifecycle Management

Supplier Self Registration

Single Global Application

SAP Sourcing On Premise (Ramp Up)

Better Heinz Infrastructure Fit



[ Why Ramp-Up

Higher risk, but . . . Improved user experience at par or better than Legacy

Functional Improvements in 7 versus 5.1

Project managementability to integrate our 7-Step

Sourcing process and links to all downstream documents RFx improvements including reporting and event

management

CLM improvementsmaster and sub agreements,

generation Vendor managementlinks to our ECC back-end

system



[

11

Integration Strategy

SAP ECC Replication

StandardMaterials, Vendors, Currencies, UOMs,

Company Codes, Plants, Payment Terms, Incoterms,

Purchasing Organizations, Purchasing Groups

Custom AdaptorExchange Rates

Worked with SAP to develop

Now standard to work with PI

SAP SRM Replication

Custom program to get vendor master from the SRM

standalone locations



[ Implementation Timeline

Blueprint to Go Live in 4.5 months
http://heinzweb.am.hjheinz.net/communities/keystone/kpmo/R0anz/R0P4%20SRM%20Timeline/R0P4%20SRM%20Timeline.bmp



[ Global Roll Out Timing

Accelerated Rolled Out Ahead of Global ECC

Initial Go Live: July 18thUS and Europe

Further successful rollouts:

CanadaSeptember 2011

IndonesiaOctober 2011 IndiaOctober 2011

ChinaDecember 2011

AustraliaDecember 2011
http://heinzweb.am.hjheinz.net/communities/keystone/kpmo/R0anz/R0P4%20SRM%20Timeline/R0P4%20SRM%20Timeline.bmp



[ Metrics

300+ people trained

70+ Strategy projects being managed in the tool

300+ Sourcing Projects

$1 Billion tendered

High level of adoption globally



[ Project Management Design

Used the Heinz Global 7 Step Sourcing Process as our

Framework

Built into the Schedule Tab

Templates, Attachments, etc.

MarketAnalysis

3StageBusinessNeeds

2StagePortfolioAnalysis

1Stage

Gate Review 1 Gate Review 2 Gate Review 3 Gate Review 4

4StageStrategyExecution

StrategyImplementn

5Stage 6Stage 7StageStrategyDevelopment

ContinuousPortfolioImprovement

Create understandingof the portfolio

Establish BusinessNeeds: short, med andlong term (5 yrs)

Understand supplymarket

Agree the appropriatestrategy

Secure agreementand contract

Effect delivery of thestrategy

Ongoing delivery againstbusiness needs and ourProcurement goals



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Project Management Details

Two types of projects:

Strategy

At the portfolio level - tomatoes, dairy, resin, energy, etc.

Leveraging tool to track compliance

Approvals by procurement leadership

Sourcing

At the market basket level

Tie into strategic projects

Level at which financial savings are tracked

Approvals by procurement finance to ensure integrity of

numbers

Savings details can be linked to various profit and loss

(P&L) buckets



[ Project Management Workflow

Sourcing Project Workflow

Strategy Project Workflow



[ Project Management Financials

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Financials Tabthe bottom portion of

the tab allows the entry of the one-timesavings, ongoing savings, and brand

allocation.



[

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RFx Design and Details

Simplified the RFxs down to 4 options:

RFI (General)

RFP (General)

RFQ (General)

RFX with Collaborative Scoring

Consolidated our spend categories so that they represent ourmaterial groups

Enabled us to streamline our reporting / drill down

Information / Questions Library

Pre-populated with content in order for the buyers to quickly

and easily bring in value-added material for their suppliers

Able to utilize the daily synced exchange rates for global events

in multiple currencies



[ Auctions Design and Details Leveraged standard SAP configuration for auctions types

Created variants when it comes to anonymous or leadingbidding

Made adjustments to what fields are on the schedule

area for simplicity

Still allow for flexibility around auction closes

Trained out best practice of going from a project into an

auction to carry over the relevant data

Efficiency in setup



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Contract Lifecycle Management Design/ Details

Enabled 4 types of contracts:

Indirect Master Agreement

Direct Master Agreement

Master Service Agreement

Confidentiality/NDA Agreement Sub-agreement usage is highly utilized (with subsidiaries)

Currently not using the line item functionality

Will start when fully integrated with SAP ECC

Clauses and templates were loaded prior to go live

Workflow Approval is triggered by agreement maximum

value



[ Contract Lifecycle Management Benefits

Facilitates Global Master Agreement with a supplier

Link in multiple regional sub-contracts

With Integration to ECC (future release)

One stop shop for authoring, editing, and approvals

Legacy

No Electronic Storage

Paper Based Approvals

Labor Intensive AuditProcess

SAP Sourcing

Global Repository

Electronic Approvals

System GeneratedAudit reports



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Global Reporting

Previously, Heinz did not have an ability to report out data

consistently Disparate legacy systems or no system

Key metrics are now the same across the globe

No longer decided by the region or business unit

Single source of truth

Key reports include -

Stages / Linkages of Strategy and Sourcing projects

Procurement Negotiated Savings

Sourced spend by supplier / category (based on events)

Visibility to sourcing opportunities both regionally and globally



[ Bolstering Adoption Strong Executive support

Usage / training mandates essential One set of globally consistent process

The whole Heinz procurement world on same tool / same

metrics

Regional Administrators Onsite or at least in same time zone

Key users

Engage early

Give them additional training

Training

Instructor led

Simulations


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[ Lessons Learned

Enroll executive support and make sure your program is

driven from the top Establish Key User network early

Metrics and reporting are big value drivers for thebusiness

Ensure users are trained before go live Communicate, over communicate, then communicate

some more

Value comes from increased visibility of global projects

and savings Global TemplateBuild it once, get it globally

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[

[

] Thank you for participating.

SESSION CODE:

1301

Please remember to complete and return your

evaluation form following this session.For ongoing education on this area of focus, visit the

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1301 Lessons Learned SAP Sourcing 70 Ramp-Up Implementation at HJ Heinz

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