Best Practices in comPlex equiPment manufacturing, sales, and serviceversion 01

saP White Paper

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contents

Executive Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Best Practices and Key Challenges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

Best Practices and Enterprise Applications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

Best Practices and Support for Service and Aftermarket Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

Best Practices and Price and Margin . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

Best Practices and Compliance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

Best Practices and Measuring Success . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

Best Practices Versus Industry-Standard Practices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

Best Practices and Eliminating Barriers to Growth . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

Best Practices and SAP Customer Success Stories for Manufacturers of Complex Equipment . . . . . 14SchumacherElevatorCompany. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14GossInternationalCorporation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14VeecoInstrumentsInc.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15Sauer-DanfossInc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15

Learn More . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

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executive summary

Bestpracticesintechnologyarehelpingmanufacturersofcom-plexproductsandequipmenttomovetheirofferingstomarketmorequicklyandmoreprofitablybyenablingthemtobecomemorecosteffectiveandefficient.Followingbestpracticesisthebestwaytonavigatetheseaofchallengesfacingmanufacturersofcomplexequipment.

Rapidlyadvancingtechnology,togetherwithstridesinmanage-mentandlogistics,bringthethreatofcommoditizationtothedoorstepofeverymanufacturer.Atthesametime,productlifecyclesbecomeshorterandshorter.Responsiblymanagingthesechallengesisincumbentuponallmanufacturers.Butforthecomplexequipmentmanufacturer,managingthesechallengesis,well,morecomplex,becausecomplexitygoesbeyondthedesignandfunctionoftheproductorequipmentitselfandextendsthroughouttheproductlifecycle–fromdesignandplanning,throughmanufacturing,service,andaftermarketsalesallthewaytoobsolescence.Asaresult,bestpracticesareespeciallyap-plicabletocomplexequipmentmanufacturers.

Foryou,manufacturingismoredifficultbecausecomplexprod-uctandequipmentdesignsrequirecross-functionaldesignteamscomingfromdifferentdisciplinesandvendorsindifferentloca-tionsandcountrieswhomustallcollaborateondesignandengi-neeringissues.Inrelationtothedesignandengineeringaspectsalone,itoftentakesanextraordinaryeffortfromcomplexequip-mentmanufacturerstodesignformanufacturabilityusingasin-gle,synchronized,time-andcost-effectivedesigncollaborationprocess.Furthercompoundingthiscomplexityistheheavyreli-anceoncomponentsystemsandsubsystemsusedincomplexproducts,allofwhichrequireintegrationnotonlyinmanufac-turingprocesses,butalsothroughoutthesupplychain.

Beyondthechallengesofdesigningandmakingcomplexprod-uctsandequipmentarethedifficultiesinherentinsellingthem.Thequotationandordermanagementprocessesmustbehighlyflexible,becausecustomersanddealersofcomplexequipmentoftenrequirecustomizedsolutions.Theyalsodemandahighde-greeofconfigurabilitytoallowthemtocustomizetheproductthemselves.Thesecustomerswant“glass-pipe”visibilityintoyourbusinesssotheycansee,atanytime,wheretheirquotationororderisintheprocess.Inaddition,evenbeforepurchasingacomplexproduct,customersaredemandingvaluefromyouintheformofsalesandengineeringexpertise.Finally,complexproductsrequirecomplexcontracts,particularlycontractswithgovernmentagenciesandlong-termcontracts,andthecompli-catedbillingthatfollowsthem.Workingunderallofthesesalespressures,thecomplexequipmentmanufacturernotonlymustmaketheproductandmakeitright,ontime,andwithinbudget,butalsomustmakeamarginwhiledoingit.

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Marginpressures,inturn,haveledtoescalatingservicecomplex-ity,drivingcomplexequipmentmanufacturerstoenhancereve-nuestreamsbydifferentiatingthemselvesthroughserviceoffer-ings.Thiscompetitivedifferentiationgoesbeyondeffective,lower-costwarrantyandservicemanagementtothemanufac-turer’sabilitytomanageandcoordinateparts,personnel,assets,resources,andvendorswiththegoalofreducinginventorieswhilemaintainingandgrowingcustomerretentionandsatisfac-tion.Moreover,servicerevenueshaveopenedthedoortoapa-radeofvalue-addedservicesformanufacturersofcomplexprod-uctsandequipment,rangingfromproactivepredictiveandpreventivemaintenancetovendor-managedinventoryandadd-onsales.

Whatbestpracticesshouldyou,asamanufacturerofcomplexproductsandequipment,usetoaddressthechallengesfacingyourindustrytoday?Whatfactorsdeterminesuccess?Whatchal-lengesmustyouovercomeinsupportingserviceandaftermarketsales?Whatbestpracticeswillhelpyoucontrolpriceandprofits?Howcanyoustreamlineandimprovetheaccuracyandcom-pletenessofyourcomplianceprocess?

Thiswhitepaperaddressesthesequestionsandopportunitiesfromthepointofviewofthemanufacturerofcomplexproductsandequipment.Additionally,itdemonstratesthevalueofbestpracticesthroughthesuccessstoriesofSAPcustomers.Itpro-videsabriefoverviewoftheSAP®solutionsusedbythesemanu-facturersofcomplexproductsandequipmenttodifferentiatethemselvesfromthecompetitionthroughsuperior-valueprod-uctsandservicesagainstlow-costglobalproviders.

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Best Practices and Key challenges

Whetheryouareasmall,midsize,orlargemanufacturerofcom-plexproductsorequipment,yousharemanyofthesamekeychallengesandcustomerexpectationsforprice,innovation,andvalue-addedservices.Inaddition,manycomplexproductandequipmentmanufacturerssharethesamecustomerbase,includ-ingthecustomerstandardsthisbasehasgrowntoexpect.

Onecharacteristicofthisdiversecustomerbaseisthatitiscon-stantlydemandingchangestoproductdesign.Formanufactur-ersofhighlyconfiguredproducts,itcanbechallengingtoman-agemultiplevariationsofproductsheadedfortheproductionfloor.Atthesametime,thesemanufacturersmayhavenew-productintroductionstheyalsowanttobringtothefloor,andthatcandoublethechallenge.

Customerdemanddrivestheservicesideofbusinessforcomplexequipmentmanufacturers,withsporadicdemandforsparepartsandservicerequirements.Thisforcesinventoriestoholdmanydifferentpartsandcontributestohigherinventorymanagementcosts.Further,thesepartsareoftendifficulttosourceinworldmarkets,challengingglobalmanufacturersandmidsizemanu-facturersthataregoingglobaltoofferglobalcustomerserviceatalevelcustomerswillaccept.

Thekeyoverallchallenge,however,isthecontinuousstruggletostreamlinetheintegrationofprocessesandsystemsrelatedtocomplexproductandequipmentmanufacturing,whichencom-passestheentireproductlifecycle,fromnew-productdevelop-mentandintroductionthroughtoobsolescence.Thetaskbecomesmorecomplexformanufacturersusinghybridmanu-facturingmethods–switchingfromengineer-to-ordertomake-to-orderwithproductconfigurationsandthentoassemble-to-orderandbackagain.Then,afterinstallation,comesfieldserviceandsparepartsthatmustgetthereontime–andataprofit.Streamliningtheproductlifecycle,includinghybridmanufacturingprocessesandorderfulfillmentprocesses,andthentightlyintegratingthemwiththesalesandservicesideofthebusinessisessentialtoprovideyourcustomerswiththeaccu-rate,consistent,andtimelyinformationtheyneed,whenevertheyneedit.

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Streamliningtheproductlifecyclerequiresanintegratedenter-prisesolutionbackedbyacohesivesales-andoperations-planningmethodologythatlinksandalignsproduction,sales,andmaterialsprocesses.Manufacturingcompaniesthatachievethislevelofplanningareseeingefficienciesrisethroughouttheirproductionandsupplychainprocesses.

Alsoenabledbyanenterprisesolutionisanothercriticalaspectofsuccessforcomplexmanufacturing:enterprisevisibility.Ascompaniesbecomemoreglobal,theabilitytoseequicklyacrosstheglobalenterprisebecomesmoreandmoreessentialtomakerapiddecisions,tofulfillcustomerdemand,tokeeppacewithproductchanges,andtomonitorinventorylevelsandleadtimesthatdrivepurchasing.Insteadofrelyingonphonecallsande-mailstofindoutinformationfromproductionorpurchasing,manufacturersandcustomerscanaccessasinglesourceofcon-sistentinformation,puttingeveryoneonthesamepageandcon-vertingphonecallsande-mailstoinformationconfirmationsinsteadofinformationrequests.

Withenterprisevisibility,complexproductandequipmentman-ufacturerscanavoidexcessinventory.Forexample,ifasubassem-blycomponentismissing,youcanseeintoanywarehouseinthesupplychaintodetermine,liveandinrealtime,whetheryouneedtoretrieveinventoryfromadepotororderfromyoursup-plier.Youwon’thavetowaituntilyouroverseasofficeopensinthemorningandsendsyouane-mailtoknowwhattodo.More-over,enterprisevisibilityallowsyoutomanageinventorysegre-gationbetweenoriginalequipmentandspareparts,enablingyoutomakeprecisedecisionsthatdonotsacrificeproductqualityorcustomerservice.

Best Practices and enterPrise aPPlications

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Uniquefactorscontributetothesalesandserviceofcomplexproductsandequipmentmanufacturing.Theseincludethespo-radicdemandforservicesandsparepartsandthechallengeofgettingthosepartstothecustomerontimeandservicingremotecustomers.Anenterprisesolutionshouldprovideanintegratedforecastingtoolthatenablesvisibilityintothefacilitydeliveringtheparts,aswellasintotherestoftheenterprise.Thisabilitytovisualizethedemandpatternoftheentireenterpriseequipsthemanufacturertosupportsporadicpartsdemandefficientlyandcost-effectively.Integratedapplicationsalsoenableyoutoposi-tioninventories,eithergloballyorlocally,tobetterserviceyourcustomers.

Thisisimportantbecausemanymanufacturersrelyonrudimen-tarysafety-stockcalculationsthatmaynotachievethedesiredbalancebetweenhighcustomer-servicelevelsandlowinventorylevels.Theoutcomeisthatmanymanufacturersmayhavetherightinventory,buttheymayhavetoomuchofit.Thebestprac-ticeistohaveintegratedorder,reorder,andsafety-stockmethod-ologiesthatconsiderhistoricalconsumption.Anadditionalbestpracticewouldbetoincludeintegratedforecastingtoolstomaintainproperinventorylevels.Manufacturingcompanieswiththesecapabilitiesareenjoyingreducedinventorylevelswithoutadecreaseincustomerfillrates.

Thesecompanieshavenoneedtorobfromproductiontosatisfytheirservicerequirements.Theycanplandemandforserviceandaftermarketsalesbecausetheyhavevisibilityintothein-stalledbaseandthesystemsupportneededtoenablepredictivemaintenanceinthefield.Thesecompaniesarerealizingtheval-ueofintegratingtheirservicebusinesswiththeirproductionandsalesbusinessusinganenterprisesolution.

Withtheirsparepartsbusinessgrowingrapidlyasapercentageofrevenue,manycomplexproductandequipmentmanufacturershavefoundtheircostcentersgrowingintolargerandlargerprof-itcenters.Typically,thesecostcentershave“island”systemsthatarenotintegratedtotheenterprise,inhibitingcommunicationwithcustomersandcustomerserviceorganizations,servicegroups,engineers,vendors,andsuppliers.

Redundancyofdataentryoccursacrossnumeroussystems,and,inevitably,theservicetechnicianandyourcustomerareaffected.However,asmoremanufacturersenjoyrisingmarginsfromtheirservicebusiness–insomecaseshigherthanthecompany’sorigi-nalequipmentbusiness–moremanufacturersarefocusingonintegratedproductandorderfulfillmentlifecycles–andthein-tegratedsolutionsthatsupportthem.

Best Practices and suPPort for service and aftermarKet sales

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Loweringcosts,increasingproductivity,andimprovingsourcingandqualitycanhelp,buttherearealwaysgoingtobelow-costproviders.Complexproductandequipmentmanufacturersmustcompeteonanotherlevel,andthatisbyofferinginnovativevalue-addedservices.Forexample,althoughitcontributestocomplexity,somemanufacturersareexpandingtheirproductandequipmentlinestothepointofbecomingtotalsolutionpro-viders,offeringfull-package,one-stop-shopsolutionstotheircustomers,insteadofonlyindividualcomponentsorpartsofthesolution.

Themovetowardbecomingtotalsolutionprovidersisoccurringacrossthecomplexproductandequipmentmanufacturingin-dustry.Manufacturersareexpandingtheirofferingsandtakingonmoreresponsibilitytomeetever-increasingcustomerde-mand.Moreover,themanufacturingbusinessmodelischanging.Younolongerjustmakecomplexproductsorequipment;youareprovidingyourcustomerswithagrowingarrayofcompeten-ciesandvendors.Inthisway,complexproductandequipmentmanufacturershavebecomebrokers,coordinatinghighlycom-plexdesignandmanufacturingprocessesacrosstheglobalandlocalsupplychain.

Thepressuresofpriceandmarginareforcingcomplexproductandequipmentmanufacturerstotakeonmoreengineeringac-tivities.Addingthisresponsibilityresultsintheneedfortightercollaborationwithcustomersandtieredsuppliersto,forin-stance,workthroughdesignissues,minimizeleadtimes,andre-solvequalityconcerns.

Anotherkeybestpracticeintheareaofpriceandmarginistoco-ordinateandmeasuretheglobalsupplychaincontinuouslytomaintainprofitability.Thisincludesbetteroffshoresourcingofproductsandassemblieswithoutsacrificingcustomer-servicelevels.

Concurrently,customersareaskingmanufacturerstoprovidesuperioraftermarket-salessupportbymanagingacustomer’ssparepartsorinventoryingsparepartsonthecustomer’ssitetoshortenrepairtimes.Thisbecomesachievablewithintegratedsystems.Manufacturerscanalsoprovidecustomerswithdiag-nostictoolsthatlinkintothecustomer’sequipmenttotrackpreventivemaintenancerequirements.Inthiscase,youmayrec-ognizeanequipmentproblembeforethecustomerdoes.Todrivecustomersatisfactionandloyaltystillfurther,youcanem-ployenterpriseapplicationsthatintegratecustomerinforma-tion,givingyouthecompleteinformationyouneed,nomatterwhenthecustomercalls.

Best Practices and Price and margin

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Pickyouracronym:SOX,DoD,OSHA,orWEEE.1Whatevertheregulatoryagency,thereareseriousconsequencesfornoncom-pliancewithitsregulations–bothrevenuerisksforsellingincertainmarketswithoutauthorization,andpunitiverisksforsellingthewrongproductintoamarket.Allresponsiblemanu-facturers,smalltolarge,payattentiontothem.

Onewayofpayingattentionistointegratefail-safeelectronicse-curityatboththetransactionandprocesslevelstoseewhochangedwhatandunderwhatauthorization.Thisprovidesanaudittrailusefultoyouandregulatoryagenciesinperformingaudits.

Islandsolutionsoftenmanageproductattributes,workforceandtrainingrecords,anddataaboutquality;environment,health,andsafetyissues;anddangerousgoodsorhazardousmaterials.However,thesesolutionsoftenrunoutsidetheoverallenterprisesystem.Bestpractice,therefore,istighterintegrationofthesesupportingsolutionswiththeenterprisesystem.

1. SOX,Sarbanes-OxleyAct;DoD,U.S.DepartmentofDefense;OSHA,U.S.OccupationalSafetyandHealthAdministration;WEEE,WasteElectricalandElectronicEquipment

Directive.

Usingenterpriseresourceplanning(ERP)softwareasabackbonegetsallcomplianceinformationandsupportingdetailsinoneplace.Auditorscanaccessthedatatheyneedinthesameplaceandcandrilldowntoanylevelofdetailtosatisfytheirrequire-ments.Additionally,theyappreciatetheeaseofusingasingleelectronicaudittrailratherthanapapertrail.Manufacturerscanalsosignificantlyreducethetimeittakestoprepareforaudits,aswellasthecostandriskoferrorexperiencedinmanual,paper-basedprocesses.

Anotherfocusshouldbeonimprovingquality-controlinforma-tionthroughthetightintegrationofquality-controlandorder-fulfillmentprocesses,includinginboundandin-processproductandshippingrequirements.Correspondencewithcustomersandsupplierscanalsobenefitfromintegratedquality-controlinformation.

Best Practices and comPliance

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Todefineandmeasuresuccessinthemanufacturingandsalesandserviceofcomplexproductsandequipment,manufacturersusebenchmarkslikeforecastsandleadtimes.Thebetteryoucanreduceleadtimesandimproveforecasts,thebetteryoucancom-peteandsucceed.Thisdepends,ofcourse,onthelevelofsalesandoperationsplanningyouputintotheeffort,coupledwiththesuccessofyourteamworkandexecution.

Forexample,onemeasurementofthesuccessofyourexecutionishowoftenyoumeetcustomershipanddeliverdates.Evenwhencompaniesreportfulfillmentratesof99%plus,thedatedeliveredissometimesnotthedatethecustomerrequested.Inaddition,thedaterequestedmaynotactuallybethedatethecus-tomerwouldlikedelivery,butratherthedatethecustomerisac-customedtoaskfor,basedonyourleadtimes.

Sometimesmakingsurethecustomergetswhatthecustomerwantswhentheywantitmeansreevaluatinghowthecompanygeneratesitscustomerfillrates.Anintegratedsolutionenablesyoutomeetcustomerrequestdateswithoutincreasinginvento-riesorpersonnelordecreasingproductivity.

Anothermeasurementofsuccess,andoneofthepurest,isyourworkingcapitalandcash-to-cashcycles.Thesemeasurementstellmanufacturersiftheirleanmanufacturingandotherstrate-giesaremakingadifference–ornot.Manymanufacturingcom-paniesareenjoyingtop-endrevenuegrowthinserviceandspares.Inadditiontorevenues,thesenewareasareincreasingvis-ibilityintocustomerneedsandprovidingopportunitiestoim-provecustomerservice.

Finally,successresultsfromimprovedcollaborationonproductdesignforbothmanufacturabilityandservice.Integratedengi-neering,productionplanning,andinventoryprocessesenablebettercollaborationandvisibilityforcorrectiveactionandtheweaningandfine-tuningofprocesses.Bestpracticeistotallife-cyclebuy-inacrossacross-functionalteamofengineeringanddesign,productionplanning,inventorymanagement,andsalesandservice.

Best Practices and measuring success

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Trendsshowmanycompaniesaremovingawayfromtraditionalpracticesandadoptingforward-lookingindustry-leadingpracticestosupportprofitablegrowthinkeyareas,asshowninthefollowingtable.

Best Practices versus industry-standard Practices

Key AreA Industry-stAndArd PrActIce Industry-LeAdIng PrActIce

Material cost control Independent procurement conducted by each department or division using standard requests for quotations (RFQs)

Aggregated sourcing of commodity items using online RFQs; collaborative design for specialty products

Aftermarket sales and service

Aftermarket service performed on as-needed basis

Proactive relationship building to identify opportunities for value-added products and services

Inventory reduction Demand planning based on past experience and seasonal trends

Out-of-the-box integration of supply chain manage-ment and customer relationship management for more accurate forecasting and demand-driven supply network capabilities for responding to real-time demand fluctuations

enterprise Visibility and control

Division-by-division analysis based on overall performance metrics

Enterprise-wide analysis based on real-time data and key performance indicators

Lean Manufacturing Extensive long-term planning based on manual processes in an attempt to predict and align all variables

Greater manufacturing flexibility and the ability to respond to demand and production changes without the need to carry excess safety stock

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Thebestpathtoeliminatinggrowthbarriersistointegratetheenterpriseglobally.Industrialmanufacturingis,afterall,aglobalbusiness.Thegloballyintegratedenterpriseenablesaccesstonewmarkets,whichisoftenthekeytosuccess.Whetheryourorgani-zationissimplysettingupshopinanewlocaleoracquiringnewcompaniesinfar-offregionstogainmarketaccess,adisaggregat-edITlandscapewithlegacysystemsworkingatcross-purposesimpedesyourabilitytoexecute.

Aholisticviewoftheglobalenterpriseiscriticalforsuccessinaglobalmarketplace.Forthisreason,manycomplexproductandequipmentmanufacturersaretakingstepstostandardizeonasinglesoftwarefoundationthatovercomesthechallengesofsilodepartments.Thisfacilitatesthefreeflowofinformationandal-lowsdecisionsbasedonreal-timeinformationandasinglever-sionofthetruth.Thismakesiteasiertointegratenewlyacquiredcompanies,aswellasdeliverasinglefacetothecustomerinacost-effectivemanner.

Byprovidinganintegratedsoftwarefoundationbasedonopenstandardsandindustrybestpractices,theSAPforIndustrialMa-chinery&Components(SAPforIM&C)solutionportfolioandtheSAP®BestPracticesforIM&Cofferingenableenterprise-widevisibilityandmarket-leadingabilitiestorolloutsophisticatedfunctionalitytonewregionsquicklyandeasily.You’llbeabletocoordinateglobalactivitieswithgreatereaseandexecuteoncor-porategrowthstrategiesmoreeffectively.

Best Practices and eliminating Barriers to groWth

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TheSAPcustomerbaseofIM&Ccompaniesincludesthefollow-ingleadersinthecomplexproductsandequipmentindustry.Eachfacesthechallengesreviewedpreviously,andeachhasselectedsolutionsfromSAPforIM&Ctoovercomethem.

schumacher elevator company

Ifcomplexproductandequipmentmanufacturersmustcom-petitivelydifferentiatethemselvesagainstlow-costglobalprovid-ersthroughsuperior-valueproductsandservices,thenSchum-acherElevatorCompanyofDenver,Iowa,hasdonejustthatinsuccessfullysellingitscustom-designedpassengerandfreightel-evatorsandcomponentsworldwide.

Onereasonforthecompany’ssuccess,saysJeffSchumacher,vicepresidentandchieffinancialofficer,isitswillingnesstolookatitsbusinessprocessesinlightofcurrentbestpracticesandtechnolo-gyinfrastructures.Thiswillingnessledtoincreasedmanufactur-ingproductivityandimprovedcustomerservice,withoutlengthyimplementationorcumbersomecustomizations,aftergoinglivewiththeSAPERPapplication,whichsupportsbestpracticesbothontheplantfloorandinworkingwithcustomersandsuppliers.

Indoingthis,SchumacherElevatorhittheup-buttontobusinessbenefits.ThecompanyreducedITsupportcostsandimprovedcustomerservicethroughbetterinformationavailability,evenasitreducedproductleadtimes�5%,increasedsaleclosingsby15%,reducedrawmaterialcosts30%duetoimprovedinventoryaccu-racy,andreducedtimetoclosebooksby�5days.

ToseetheSchumacherElevatorbusinesstransformationstudy,linkto:www.sapmanufacturing.com/mfg/resources_businesstransformation/SchumacherElevatorCompanyBusinessTransformation.pdf.

goss international corporation

IndustrygiantGossInternationalCorporation,headquarteredinBolingbrook,Illinois,isoneoftheworld’sleadingmanufacturersofweboffsetprintingmachinery,software,equipment,andfin-ishingsolutions.FollowingtheacquisitionofHeidelbergWebSystems,adivisionoftheHeidelbergGroup–thehugeGermany-basedmanufacturerofprintingmachinery–Gosssetouttoachievethevisionof“onesystemforonecompany”bystandard-izingitsprocessesandunifyingitsworldwidenetworkwithasin-gleinstanceoftheSAPERPapplication.

Followingtheimplementation,whichtookjustsixmonthsandincludedthesuccessfultransitiontoanSAPdatacenter,ananal-ysisofGossworldwideoperationsrevealedanalmost100%fitwiththeroadmapavailableintheSAPBestPracticesforIndustri-alMachinery&Componentsoffering.

WiththeimplementationofSAPERP,Gossachievedannualsav-ingsofUS$4millionincontracteddata-centermaintenancefeesandthroughlowersupportcostsduetoreducedITcomplexity.Itimprovedprocessesthroughglobalstandardization,creatingonecommonapproachtoIT.Furthermore,Gossenhanceditsanalysesandplanningcapabilitieswithintegratedfinancialinfor-mation.Thecompanyimproveditsserviceandsaleswithaccu-rate,up-to-datecustomerinformation.Furthermore,usingsharedservices,Gossreduceditsinventory.ToseethefullGossInternationalsuccessstory,linkto:www.sapmanufacturing.com/mfg/resources_successes/GossCustomerSuccessStory.pdf.

Best Practices and saP customer success stories for manufacturers of comPlex equiPment

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veeco instruments inc.

HeadquarteredinWoodbury,NewYork,andwithglobalopera-tionsspanningtheUnitedStatesandabroad,VeecoInstrumentsInc.isaleadinginstrumentmanufacturerthatgrewbyacquisi-tion.AccordingtoLindaChan,Veeco’sITdirectorofworldwideinfrastructure:“Veecohasgrownbyacquisition.Asaresult,wehadallkindsofdisparateERPsystems–everythingthatyoucouldpossiblyfathom.”

Tocompeteeffectivelyandtogrow,stayagile,andstayprofitable,Veeconeededtoachieveoperationalexcellence,anditcoulddothatonlybycreating“OneVeeco”–unifyingitsprocesseswithbestpracticesundertheSAPAll-in-OneforIndustrialMachinery&Componentssolution.TherolloutofthesolutiontonineVeecoU.S.facilitiesiscomplete,andimplementationisinprocessatVeeco’sEuropeanlocations.

Consequently,Veecoisalreadyreapingbusinessbenefitsintheformofimprovedon-timedeliveryperformance,shortenedde-liveryleadtimes,reducedtimetomarketfornewproducts,andtheeliminationofmanualprocessesthroughautomation.Veecohasalsoimprovedinformationflowfromsalesofficestomanu-facturing,whiletheflexibilityofreportingstructuresenablesthehierarchicalaggregationofbusinessunits.

ToseethefullVeecoInstrumentssuccessstory,linkto:www.sapmanufacturing.com/mfg/resources_successes/VeecoInstrumentsCSS.pdf.

sauer-danfoss inc.

ThenameSauer-DanfossInc.standsoutinthebusinessofmo-bilemotionandcontrolproduction.Thesamenamepowerssomeofworld’stoughestmobilemachineryandequipment.Thisincludessuperstrongforkliftsandaeriallifts,tractors,andothermobilemachineryusedinmanyindustries–fromagricul-ture,construction,andmaterialhandlingtoroadbuildingandforestry.

Asstrongasthecompany’sproductswere,itshomegrownandconfederatedERPsystemsneededalift.Amergerin1999result-edin13diverseERPsystems,makingitimpossibletogettimelyanswersonthestatusofthesupplychain.Thesemultiplelegacysystemswereleadingtodisjointedsourcesofinformationandmaterialflow.Additionally,someplantshadnonintegratedshop-floorsystemsandfinancialsystems.

TheimplementationoftheSAPERPapplication,togetherwiththeSAPNetWeaver®ExchangeInfrastructurecomponent,solvedtheseproblemsforSauer-Danfossandresultedinastringofbusi-nessbenefits.Theseincludeexpectedcostreductionsof5%to10%ininventory,customerservice,andfinanceandtheabilitytomakebetterbusinessdecisions.LowerITcostswithmorefunc-tionality,improvedthroughputofinformationflowtotheshopfloor,andincreasedcustomersatisfaction–withtherightprod-uctdeliveredattherightpriceandattherighttime–roundoutthebenefitsforSauer-Danfoss.

ToseethefullSauer-Danfosssuccessstory,pleaselinkto:www.sapmanufacturing.com/mfg/resources_successes/SauerDanfossCSS.pdf.

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Tolearnmoreaboutbestpracticesformanufacturersofcom-plexproductsandequipment,pleasevisittheSAPWebsiteatwww.sapmanufacturing.com.�

�.Sourcecontentderivedfrom“GettingtheComplexProducttoMarket:BestPracticesinManufacturing,Sales,andService,” Industry WeekWebcast,April1�,�007,hostedbyJohnBrandt,chiefexecutiveofficerofManufacturingPerformanceInstitute.Additio-nalcontentderivedfromnumerousinternalSAPsources.

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