Future Operations Execution
Case Study
GrundfosOne integrated global supply chain
Grundfos and Implement Consulting Group
Author
Søren Skjødt
In response to the recession setback, Grundfos introduced an integrated S&OP process supported by SAP to optimise its global supply chain.
Until 2008, Grundfos had experienced 60 years of uninterrupted revenue growth. Approx. 10% per year. When the recession hit, it took six months for Grundfos to adjust their production and supply chain costs to the immediate drop in sales. And that is six months too long.
Grundfos realised they needed much better coordination of global sales and operations planning. The company decided to integrate SAP APO with their existing SAP ERP software. And Implement was chosen to help with this integration.
Careful preparation
At Grundfos, SAP APO interacts with SAP ERP to form an integrated platform for overall sales and operations planning. All processes are transparent, and Sales and Marketing, Operations, Product Management and Finance operate according to the same figures. Planning is integrated at global, regional and local levels, which allows for immediate intervention if adjustments are necessary.
Grundfos and Implement spent a full year designing new sales and operations planning processes and preparing for their implementation.
The recession taught us two things. We realised how lucky we had been during our first 60 years, enjoying steady growth year by year. We also learnt that steady growth was not a given in the future
Ebbe Gubi, Director of Demand and Supply Integration at Grundfos
Ebbe Gubi, Director of Demand and Supply Integration at Grundfos says: "We wanted to make sure that we had a thorough understanding of the problems we were experiencing and what it would take to solve them. We also wanted to make sure the organisation was properly prepared for taking on the migration to an integrated SAP platform. Our careful preparation paid off. We completed the implementation on time – with no unpleasant surprises along the way."
Cost savings and customer satisfaction
Implement helped Grundfos with a complete overhaul of their supply and demand processes and carried out the installation of the SAP APO software, using best practice procedures advocated by SAP.
The new integrated SAP platform has enabled Grundfos to get faster to market. The company has cut the lead time by 16% and improved delivery times by 10-15%. As a result, Grundfos has not only cut costs and saved time; they have also achieved great customer satisfaction.