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Enabling the Cement Industry through SAP Solutions

Nikhil Chaturvedi, IBU-Mill Products & Mining Date: 6th June 2008

Agenda

1. SAP: Profile & Credentials 2. Cement Industry: Trends and Challenges 3. SAP: Solutions for the Cement Industry 4. Cement Industry: Case Studies

SAP: Profile & Credentials

SAP in the Cement & Building Materials Industries


400

300

More than 700 SAP customers in building materials (May 2007) Building materials customers in 70 countries

200

100

te es

rn

r Eu

e op

t e lia ca ic a ri ca Eas o p st ra Afri r er e u e E Am Am idd l Au rn h th t e r M t u s No So Ea As ia

120 100 80 60 40 20 0
ge far La l cim Ho t x nti en me me em e Ce C c l rg Ita lbe i de e H

4 out of top 5 cement producers rely on SAP

SAP Customers in Cement / Concrete Industry


Over 195 Customers Holcim (70 + Countries) Heidelberg Cement Italcementi Loma Negra C.I.A.S.A. Lafarge Perlmooser AG Hanson Saint Lawrence Titan Cement Company S.A. ESSROC Incorporated (Italcementi) Beton Son B.V. Mahaphant Fibre Cement Siam Cement, Siam City Cement India Associated Cement Company (ACC), Ambuja Cement Grasim Cement, L&T Cement (Ultra Tech Cement) Calcom Cement Prism Cement Sanghi Cement Rajshree Cement Malabar Cement Binani Cement JayPee Cement Deepak Cement Dalmia Cement JK Cement

Executive Advisory Council Building Materials

Objective The Executive Advisory Council for the Building Materials Industry is a forum for strategic debate of key industry issues at executive level. The objective of this forum is to Align SAP and industry vision of where the building materials industry is heading. Identify focus areas for SAP to support the vision and trends. Establish a discussion and influence channel for the industry.

Executive Advisory Council Building Materials


Chairmanship
Chairman Dr. Georg Schulz Holcim, Head of Department Co-Chairman Jose Antonio Molares Cemex, Director

SAP Responsible Dr. Udo Werner Industry Principal Building Materials

Workgroups
Next Council Meeting: 2008 EAC for Cement & Building Materials Customers July 8-9, Heidelberg, Germany Ready-Mix Requirements CRM and Object Management

Cement Industry: Trends & Challenges

Cement & RMC Industry: Trends & Challenges Differentiation and Innovation Productivity and Efficiency

Optimize Margins and Profitability Superior Customer Service


Innovative Processes Cross-Industry Value Networks Customer Self Services Joint Research Cooperation Superior Flexibility New Business Models Maximum Reliability Process Efficiency Managing the Triple Bottom Line Attract Investors Competitive Prices Ensure Compliance Enhanced Analytics & Process Integrity Reduce Material Costs

Plant Efficiency
Asset Asset portfolio Utilization Transparency Product & Service Portfolio Asset Planning & Maintenance Business Partner Portfolio Investment Planning Use of Alternative Fuels Efficient Energy Management

Innovative Supply Chain Processes


Increasing Competition from Transportation Tracking & Tracing, Emerging Markets GPS High Transportation Cost Flexible Freight Tendering Resource Replacement Self-Service Delivery & Substitution

Standardization & Harmonization


Reduce Cost & Increase Efficiency Communication Standards Ensure Governance & Compliance Global Rollout of Best Practice Solution Flexible deployment

Global Growth
Retain Knowledge of Markets Aging Workforce Grow into Emerging Attract & Develop New Talents Fast Digestion of Mergers & Acquisitions Speed-up Learning Curve IT that adapts to local conditions

IT is the Enabler to Meet Tomorrows Business Challenges

Cement & RMC Industry: Trends & Challenges


Capital Intensive Manufacturing
Capital extensive business requires high utilization of production facilities Planning and optimization of downtimes and maintenance activities Cost Control is a Must High Distribution costs Fast rising energy prices while product prices have to stay competitive... ... Resulting in declining profit margins Cost effectiveness on all levels sought Flexible Planning and Production Production optimization on short term notice Planning maintenance activities Customer Service Customers in remote locations Centralization to become more effective Self service loading and electronic invoicing High change rate of orders due to uncertainties on construction sites SCM and Transportation Multiple Plants, Storage locations and customer locations Significant transportation cost in comparison to product value Local market, limited by transport cost ratio (cement: app. 100 km around a plant)

Business Challenges faced by the Indian Cement Industry


Cement prices in India are market driven and volatile. Retrospective changes are routine Prices vary from district to district and customers are invoiced at the specified rate for consignee's location Even though, Cement companies try to create Product differentiation, market share is highly dependent upon Price and hence, Cost control in Production as well as Logistics is very important Prices include taxes & freight hence realization calculation is complex Most payments are on-account type and not linked to invoices Complex system of discounts and incentives Consignments of both road and rail sometimes needed to be reallocated / rerouted Incentives and associated credit/debit generation Delivery tracking Accounting for damaged cement (bags) Transporter Billing on retrospective basis

SAP: Solutions for the Cement Industry

Optimized Organization and Process Landscape


Central control.
Strategy Vision Governance, risk, compliance
Shared service: Products and technology

Shared service: Benchmarking Plant

Shared Service: Processes Shared Service: Planning

Region

Region

Plant

Localized services
Procurement Sales Customer relations Supply chain planning Accounting
Plant

Plant

Best-run plants
Production Maintenance Quality Sustainability

SAP Solutions for Cement Companies

Central processes
Strategy management Analytics Compliance solutions Business process modeling Multi-language capabilities Solution manager

Localized services
Customer relationship management Transportation planning Price and margin management Supply chain planning

Plant operations
Production execution Shop floor visibility Quality management Inventory management Maintenance planning

SAP Solution Map: Cement & Building Materials


Suppliers & Partners Product Design Marketing & Sales Planning Procurement Order Management Manufacturing Distribution Customers & Channels

Time to Market New Product Development & Introduction Life-cycle Data Management Supply Chain Planning Demand & Supply Planning Transportation Management Procurement Strategic / Global Sourcing Operational Procurement Order Management & Execution Enterprise Asset Management Warehouse Management Sales Order Management Manufacturing Scheduling and Execution Drop Shipment Customer Service Customer Interaction Complaint / Claim Management Quality Management & Compliance Quality Management Compliance Management

Enterprise Management & Support

SAP is focusing on building materials hot topics with specific solution offerings based on SAP ERP
Analytics
Shop Floor Integration Cost & Quote Mgmt. Enterprise Asset Mgmt. Environmental Health & Safety Channel Sales Mgmt.

SAP PLM

Strategic Sourcing

SAP SRM

SAP ERP

SAP CRM

Shared Service Center

Logistics Execution

Service Mgmt.

SAP SCM
Compliance

SAP NetWeaver
Self Services Delivery Visibility & Tracking Financial Supply Chain Mgmt

Transportation Mgmt.

Typical Application Solution Architecture


Strategic
Objectives & Policies

Strategic Planning

Demand Planning

Capacity & Supply Planning


Procurement Planning

Tactical

Distribution Planning

Production Planning

Supply Chain Planning


ERP / MES / SCM / mix

Inventory Planning

Financial & Management Accounting, MRO Procurement, HR..

Transactional
Selling

Order Fulfillment

ERP
Distribution. Production. Delivery

Prod. Execution Process/Plant Control

Scheduling

Sequencing

Production Execution

Warehousing

MES
Multiple Systems

PCS

DCS

SCADA

DAS

Control & Process Data Acquisition


Multiple Systems

Customer Service: Sales Order Management


Assuring high customer service levels is critical for Building Materials companies to improve customer retention and loyalty. Sales can easily, quickly and accurately, determine pricing and costing, check production resources, as well as track and manage quotations, contracts, deliveries & invoices reducing sales cycle time & ultimately increasing revenue. SAP provides a comprehensive sales order management solution to efficiently process quotations and sales orders.

Industry Challenges
Low sales efficiency with order fulfillment errors generated by a lack of insight into purchasing, production and inventory information. Long sales order lead times and slow response times to customer queries on order status due to manual processes and siloed info. Low customer & product profitability due to lack of available information, analysis & decision-making support tools.

SAP Solution
Sales and Distribution Sales and Distribution (cont.)
Free of Charge Delivery Prospect Customers Sales Order Processing Debit Memo Processing Customer Down Payment Delivery, Picking, Billing, Payment, Print Documents Cross Company Sales Order Processing Reporting (Open Orders, Expiring Quotations, etc.)

Sales from Stock Quotation & Order Processing Make-to-Order Batch Handling Credit Management Foreign Trade Export Processing (Intrastat, Extrastat, Customs documents) Third-party drop shipment Sales of Bought-In Item

Business Benefits with SAP


Improved customer service thanks to comprehensive capabilities that enable sales to deliver accurate product specification and usage, price, quantity and delivery information to customers. Reduced order processing costs through streamlined, automated processes. Increased customer profitability with comprehensive sales quotation and order analysis.

SAP Sales Order Entry via a Call Center


Business challenge for concrete companies
Inefficient sales order processing Sales order processing done at each concrete plant Lack of standardized sales order processing No optimization of production and transport across plants

Solution
Centralized order entry at call center Incoming orders automatically distributed to plants Automatic credit management Checks available production capacity of plants Checks availability of transport vehicles

Centralized Sales Order Processing

Transport Scheduling

Business benefits
Less personnel required Can operate 24 hours per day, if necessary Improved accuracy of order information Reduced transport cost

Solution Map

SCM CRM

Reporting Plant Scheduling

ERP

Supply Chain Planning: Demand & Supply Planning


Consolidated, sychronized supply and demand planning helps Building Materials manufacturers enable and improve forecasting in a commoditized product portfolio, as well as supply chain visibility and efficiency. SAP Business All-in-One provides a flexible, powerful solution for integrated annual operating, sales & operations, as well as materials requirements planning.

Industry Challenges
Inaccurate forecasting due to an unstructured planning process with distributed data across sales and business units. Inefficient portfolio management through poor visibility into global demand and supply status. Lost sales and high inventory levels through siloed sales, production and inventory planning processes.

SAP Solution
Annual Planning / Forecast Logistics Planning

Annual operating planning (AOP) Sales quantity forecasting Monthly Sales Plan Quantity by Customer/ Product Transfer to sales & operations planning (SOP) Profitability reporting Anonymous Forecast

Planning/forecasting of future demand Aggregated production planning including capacity check Long Term Planning of material requirements, based on production plan Transfer to detailed MRP and Production Planning / Scheduling Plan work Center capacities

Business Benefits with SAP


Improved customer service levels through accurate, consolidated sales and revenue plans, and better supply chain visibility to enable improved customer responsiveness and order fulfillment. Optimized portfolio management with better insight into product and customer profitability, as well as the demand and supply situation. Better supply chain efficiency with asset optimization and reduced inventories through synchronized sales & revenue planning with production planning.

Functions of Demand Planning


Structure Demand Information by freely definable characteristics Customer, Product, Sales Office, Region, Location, ... Display Demand Information by freely definable Key figures: Last years Sales, Committed Contract Volume, Marketers Forecast, Customer Forecast, ... Different options for Data Sources Direct manual input by user, Entry via Internet (customers), Upload from data warehouse, Calculated data (i.e. multiply row last years sales by 5 %) Aggregation and Disaggregation of Demand Data Different Views on the same data based on user role Flexible time buckets to enable strategic and tactical planning Statistical Forecasting methods (i.e. seasonal trend models) Alert and Macro Functions Flexible Reporting Options

Demand Planning
Planners Knowledge
Task-specific planning tools Flexible views Graphics Promotional planning Life cycle management Accuracy reporting

Anticipation of Future Demand

Information
Collaborative forecasts

Demand Planning Data Mart

Statistical Methods
Multi-model approach Average models Exponential smoothing Causal factors Trend dampening Model combination Pick best

Order & shipment actuals & history Cost POS data Nielsen / IRI data ...

Solution Overview
SNP generates network of production orders and stock transfer orders

Production plants 60% 40%

30%

70%

Distribution centers

Demand plan

SNP Optimization

Liste

Supply Supply chain chain model model

APO

Forecasts Forecasts sales salesorders orders

Flexible Constraint Definition Capacities Material availability Market constraints Costs of opportunity

Sourcing Sourcing Product Product mix mix Production Production& & procurement procurementplan plan Inventory Inventorystrategies strategies

Cost minimization - Profit maximization

Optimization

Optimization Profile

Selection of most suitable production plant

Optimization of production costs, transportation costs, and storage costs

Storage capacity

Transportation capacity

Mixed integer linear programming / metaheuristics

Determines which constraints are considered

Safety stock

Feasible plans
Handling capacity Production capacity

Shipping & Transportation Management


External Contracts Yard Management Break Weight Calculations Freight Costing Transportation Billing / Payment Monitoring Transportation Truck Load Definition Transportation Planning Work Load Estimation Serial Number Management Route Schedules Delivery Processing Picking Packing Goods Issue Printing & Communication Planning / Monitoring / Analysis Batch Management

Pick

Sort

Pack

Load

Print

Ship

Capabilities of SAP Transportation Planning & Execution


SAP TM
Freight Management Transportation Dispatching & Execution
Manual Dispatching Planning / Optimization Routing Scheduling Carrier Selection Shipment Order Freight Order Tendering Continuous Move Compartment Planning Freight Space Booking Execution Replanning

SAP ERP
Transportation Charge Management Financials Integration

Customer Contract Shipment Request Freight Request Shipment

(Quotation)

Transportation Charge Calculation Costing & Rating Engine Customer Freight Agreement Carrier Freight Agreement Customer Freight Billing Billing Preparation Supplier Freight Invoicing Settlement Preparation

Billing / Invoicing Customer Billing (SD) Freight Auditing & Self-Billing (MM) Financial Accounting Account Determination Installments Accruals Controlling Profitability analysis Profit sharing

Visibility

SAP Event Management and SCM Basis


Exchange Infrastructure

Analytics (Business Intelligence) Netweaver

Global Availability Check

Checking Product Availability at time of Sales Order Creations Simulating Global Supply Chain based on projected inventories in the future Consider product substitution based on predefined rules Consider substitution of supplying location based on predefined rules Re-simulate Product Availability Check at any critical point in time Re-consider priorities based on predefined rules Enable Sales Managers to immediately check on Delivery Capabilities

Manufacturing: Seamless Integration


6 All Six Key Capabilities are Integrated and Seamless 1
Visibility
ATP/CTP Safety / Target Stock Manufacturing Costing & Performance Mgmt. Tracking & Genealogy Subcontracting and Collaboration Manufacturing Event Management

Manufacturing Planning
Forecasting/Collaborative Forecasting Make-to-Stock / Make-to-Order Finite Capacity Scheduling Material Requirements Planning Recipe Management

SAP NETWEAVER Manuf. Intelligence Dashboards Manufacturing Visibility Environmental Health & Safety Manufacturing Planning Manufacturing Execution Quality Management Maintenance Management

Manufacturing Execution
Production Process Management Batch Management Labor & Resource Management Outbound Processing Production Dispatch

Plant Maintenance
Technical Asset Mgmt Predictive & Preventive Maintenance Maintenance Execution Integration to purchasing

3
EH&S Compliance
Product Safety Management Hazardous Substance & Dangerous Goods Emissions & Waste Management Industrial Hygiene and Safety Occupational Health

Quality Management
LIMS integration Quality Engineering Quality / Tracking Control Quality Improvement Audit Management

Production Planning
Portals Alerts Reporting Backflushing Costing Planning Strategies Make To Order Sales Operation Planning Confirmations Project Production Production Resource Tool Work Center Management Master Production Scheduling Production Order Management Capacity Planning Demand Management MRP Routing

Line Manager

MRP Controller

Plant Manager

Operational Compliance: Quality Management


Efficient quality management helps Building Materials companies better manage and assure product quality, monitor & improve quality standards, as well as document quality compliance for subsequent audits. The SAP solution delivers a robust quality management solution to support high quality sourcing and improved vendor management.

Industry Challenges
Quality issues cause lower quality end products lowering operating margins and customer satisfaction. Poor tracking of supplier material quality results in high cost return to vendor processing and delayed time-to-customer. Complex tracking of materials and quality documentation for regulatory compliance.

SAP Solution
Quality Management

Inspection lot generation / inspection defects recording Usage decision processing Quality notification Stock procurement with QM Goods return to vendor Vendor evaluation Batch management (with batch traceability) Batch recall Batch analysis

Business Benefits with SAP


Increased customer satisfaction through efficient quality management processes to assure high product quality. Improved supplier selection and management with vendor evaluation process. Lower operating costs and increased product profitability support by quality inspection and monitoring throughout the product life cycle to reduce product errors. Easier regulatory compliance with quality documentation and auditability of information & actions across the supply chain.

Sourcing & Procurement Strategic & Operational Procurement


Maximize the return on relationships through all suppliers within the supply chain from strategic sourcing to operational procurement. SAP enables Building Materials Companies in reducing procurement cost & time of inventory replenishment. SAP delivers a complete, integrated solution for the entire procurement cycle.

Industry Challenges
Poor vendor selection results in long lead times, over-priced materials, and low material quality triggering high cost returns. Inefficient, manual and paper-based procurement processes.

SAP Solution
Materials Management Materials Management (Continued)

Business Benefits with SAP


Optimized vendor selection with vendor evaluation vendor pricing, service, lead-time & performance comparison/evaluation to better negotiate contract terms, reduce material costs, lead times and returns. Reduced operational costs with automated procurement tasks in administration, production and transportation including purchase requisition creation, invoice verification, payment processing etc. Comprehensive visibility into the supply chain through integrated processes for better inventory turnover, cycle times, and lower receiving and material storage costs.

Purchase Price Negotiations with Vendors Request for quotation Procurement contracts Purchase requisition & order processing Internal procurement Subcontracting

Stock Transfers Procurement & Consumption of Consigned Inventory Goods receipt (with batch number creation & quality inspection) Return to vendor Invoice & payment processing

Financials
Building Materials companies need comprehensive, accurate enterprise visibility and strong financial management support to (1) fulfill financial requirements, (2) enable profitable growth and (3) operational efficiency. SAP provides the market-leading solution for accounting, financial reporting, and performance management integrating financial management with business processes.

Industry Challenges
Inefficient accounting and controlling processes with information located across transaction and financial systems. Inaccurate, incomplete cost and revenue data for portfolio, asset and operations management. Different, country-specific financial accounting processes, principles and regulations.

SAP Solution
Accounting Accounting (continued) Sales and operations planning Purchased material price planning Cost center planning Internal order accounting Product costing Period end closing incl. inventory valuation

General ledger Accounts payable / receivable Cash management Cost of sales accounting Asset management Segment reporting Period end closing Revenue planning

Business Benefits with SAP


Efficient, automated accounting and controlling processes. Complete and accurate data through seamless process integration across operational areas of the company. Enhanced company profitability analysis by market segment (products, customer, orders, business units). Automated calculation & comprehensive visibility & analysis of project, asset and product costs throughout the life-cycle. Easier multi-country financial reporting with, multi-currency and asset & inventory valuation capabilities.

Financial Management
Analytics Parallel Accounting Billing Expense Management Check Printing Payroll Funds Management Treasury Cash Management Streamlines information control, analysis, and delivery Enables performance planning, measurement, and management Optimizes the financial supply chain Most comprehensive, functionally-rich solution on the market Market-leading solutions and customers in all industries Reliable, proven business partner with solution and industry expertise Activity Based Costing Profitability Analysis Asset Accounting Budgeting Overhead Cost Controlling General Ledger Legal Consolidation Accounts Receivables Accounts Payable

All SAP applications are completely integrated into Accounting


1. Process Order 2. Collected Costs Example: Actual Costing of a product based on actual production, purchasing of raw materials and asset utilization:
For live demo: show Ides Scenario Cement Costing and Actual Costing

4. Monthly Analysis

3. Settlement to G/L

Cost Accounting

Cost Accounting Cost centers

Integrated process flow for a cement plant


Raw Material Extraction Cost Center Raw Material Preparation Cost Center Raw Meal Preparation Cost Center Clinker Production Cost Center Cement Grinding Cost Center Distribution Cost Center 10 Labor costs 21 7 Material Stock 2 Delivery Consumption 8 Consumption per time period 12 Production amount per time period 11 Cost Allocation Sales & Distribution Human Resources 14 Order Customer 17 Delivery Note 18 Invoice Prod. Order Delivery

Local Plant Technical Information Systems

15 Stock reduction

Supplier

Purchase Order

Material Management 3 Material/Cost booking 16 Costs 4 AP

Production Planning

9 Cost booking COGS Profit /Loss 6 Cash Finance Controlling 13 Cost equivalent 20 Revenue Cost Collec. Cost size 19 AR

5 Invoice

SAP Business Information Warehouse

Ease of Further Evolution


Business evolution requirements
Customer relationship management Market intelligence systems Management tools for marketing operations Sales force automation

SAP coverage

CRM fully integrated to supply chain execution and finance backbone Covering engagement, transaction and fulfillment process

Supply chain management Strategic & tactical planning functionalities Link to execution Warehouse operations Transport management system

All levels of SC planning are covered by SAP SCM (APO) Online integration to ERP 6.0 ensures capability for simultaneous planning and availability check Transportation and warehouse management integrated as part of the overall solution Maintenance module integrated with Finance/Controlling, HR and materials management module covering also maintenance of mobile assets SAP Strategy management (by BusinessObjects)

Back office Fixed asset control system Maintenance systems Coprorate Stragtegy Management

Analytics & Operations Support


Cement companies need a complete, integrated view on financial and operational targets and figures to (1) develop realistic business plans as well as (2) monitor and support operational decision making. SAP provides tools to generate a complete picture of Cement companies to control growth and operational excellence.

Industry Challenges
Lack of visibility into financial and logistic key figures throughout all company departments. Inaccurate and incomplete statistical data base to link strategic plans to operational performance. Lack of analytic support to understand the profit drivers of Materials business.

SAP Solution
Cross-functional Analytics for ERP Analytics for ERP (continued) & Operations Support

Analytics for MRP, Purchase requisition, stocks Quotations, Sales Orders, Line items, Deliveries, Billing Credit Overview & Memos, Customers Backorders, Sales Support, Returns Purchase Orders, Contracts, Scheduling Agreements

Analytics for Vendor, Warehouse stocks Batch analysis, Availability overview Plant & Material Analysis Operations Support for Quality Management Global Trade Services Project / Portfolio Management Indirect Procurement

Business Benefits with SAP


Single analytical platform for the whole enterprise in a crossfunctional and collaborative environment. Support of integrated and realistic business planning and monitoring of costs and revenue during execution. Actual detailed operations reporting and support of operational decision making in sales, production and procurement. Integrated operational support of cross functions like quality management, procurement and project management.

Performance Management Sample Indicators


Specific Maintenance Costs Investment to Maintain Productive Capacity and Competitiveness Specific Replacement Investments Mean Time between Repair Preventive Maintenance Routines Own Personnel Production Subcontracted Personnel performance Accidents with Time Lost Overtime Outstanding Work Clinker Factor Overall Equipment Efficiency Mean Time Between Failures Coefficient of Variation of Cement Mortar Strength Thermal Substitution Rate
Maintenance Performance

General Cement Ready-Mix

Production Performance

Personnel Performance

Average Volume Produced per Plant Volume Delivered per Truck Specific Cost of Electric Energy Specific Cost of Traditional Thermal Energy Specific Cost of Alternative Thermal Energy Specific Actual Cost of Cement Specific Raw Material Cost of Ready-Mix Concrete Produced Average Selling Price of Ready-Mix Concrete

Cost Performance

Production Supervisor UI

SAP Quality Management - Quality Control


Quality Control enables recording, tracking and analysis of product and process characteristics to ensure quality compliance.

Key Functionalities
Quality Inspections Laboratory Integration

Key Benefits: Supports automatic or manual triggered inspection lots Integrated tightly with the complete supply chain (e.g. inventory, batch, purchasing) Enables statistical process control (SPC) to monitor critical product and process characteristics in the manufacturing process and allows instantaneous intervention Documents product quality to achieve regulatory compliance Includes integrated problem management

Test equipment Interfacing Usage Decision / Release Certificate of Analysis Statistical Process Control Problem Management Test Equipment Calibration Quality Information System

Quality Inspections
Comprehensive inspection processing Goods receipt inspection In-process control Post-process control Inspections at goods issue Recurring inspections Test equipment interfacing Statistical process control (SPC) with integrated problem management Use as Enterprise LIMS Results recording - mobile or Web-based Functions integrated in logistics (e.g. inventory management)

A Snapshot of the Quality Inspectors Dashboard


High frequency tasks can be saved as favorites and launched on demand

Work list with multiple views that contain inspection lot related tasks.

Direct access to results/defects recording application Direct access to the confirmation application

Enterprise Asset Management An Evolution

Maintenance Management Systems

Asset Maintenance MRO Procurement and Inventory

Full Enterprise Asset Management


Human Resources Time and Payroll Skills Management Inspection and Calibration RFID and Mobile Devices Project Management MRP & Spare Parts Management Core Financials Financial Optimization Reliability Reporting

EAM: Functional Scope


Design & Specify Business planning Investment management Collaborative specification and design Maintenance engineering Interfacing CAD systems Project management Maintenance cost planning Procure & Build Supplier qualification and candidate selec. Bidding and contract management Procurement process Document management Project management Collaborative construction Project and investment controlling

Decommission & Dispose Asset transfer and disposal Collaborative disposal mgmt. Document management Project management Waste management Asset compliance Asset re-marketing

Operate & Maintain Technical asset management Preventive and predictive maintenance Maintenance planning and scheduling Work order management Mobile asset management and RFID Contractor management MRO and services procurement Work clearance management Shutdown planning Interfacing GIS and SCADA

Facility & Asset Management


Work Force Management Location & Asset Mapping Maintenance Planning & Scheduling Budgeting & Sanctions Meter Reading & Counter Based Mobile Device Valuation & Status Management Preventive / Predictive / Breakdown / Internal / Techn. Object Shutdown Maintenance Tools & Documents Complaint Management Warranty & AMC

Equipment History GPS Interface Early Warning System

Co

Hi st or y

ot ifi ca

PM

pl

et

Condition description Item data Activities / Tasks Priorities

External resourceWork Clearance planning Release / Print Control / Execution

Time- / Contracts & Subcontracting Material Objects confirmation Orders / Spares Management Technical Notifications completion Costs Order Downtimes settlement

tio

de

Or

io

Plant Maintenance (PM) in SAP ERP basis of EAM


NetWeaver

MM
BI-Data Warehouse
Material master Inventory mgmt. Purchasing Contractor

CO
Cost center controlling Order controlling

PS
Project structure and controlling Budgets

AM
Asset master Depreciation Capitalization

Test equipment Calibration tasks Calibration results Qualifications Manpower planning Time tracking Payroll mgmt.

QM

-Technical Asset Management - Preventive and Predictive Maintenance - Breakdown Maintenance - Refurbishment

PM

PP
Integration with production

Portals

HR

DMS
Manage documentation

Mobile Solution

Value of integration

Maintenance Cost Budgeting

History Based Budgeting Ad hoc Budgeting Simulation Location Based Equipment Based Tasks Based

Mobile Asset Management - Functional Overview


Data creation and assignment

SAP Backend

Data update in backend

Order Management

Measurement & Counter Readings

Contract Management

Inventory Management

Business Partner Management

Notification Management

Technical Object Management

Maintenance Inspectors Dashboard: Sample


High frequency tasks are aggregated in the services list Work list of current Maintenance Orders and Notifications can be configured as needed

Direct access to the confirmation application

Reports can be extracted from SAP BI or any system on the plant floor

Project Systems (PS)


Project Reuse Project Archiving Project Status Management Project Base lining & Simulation Multi -Project Management Project Progress Tracking Project Claims Project Confirmations Project Document Distribution Project EH&S Capacity Management Project Procurement Project Production Project Costing Project Initiation Project Team Project Estimation & Budgeting Project Planning & Scheduling

Online

Offline

PROMAN

SAP MII: Manufacturing-to-Business Integration

? ERP
DISCONNECT

How are we hitting our targets? Total Cost of Production and Variance Labor and Resource Productivity Order Fill Rates and Cycle Times Fixed and Variable Asset Utilization
DISCONNECT

? MES

Whats happening during every shift? Material availability and consumption Capacity availability and utilization Schedule changes Product Genealogy tracking and QM Whats happening at each line? Cycle Times / Operating Efficiencies Machine Breakdowns / Unplanned Downtime Quality Index Predictive Maintenance requirements
SFAC - Shop Floor Automation and Control Systems MES Manufacturing Execution Systems DCS Distributed Control Systems

SFAC*

SAP MII offers these Core Functions/Services to enable Manufacturing Integration and Intelligence
MANUFACTURING INTELLIGENCE
Visualization Services Charts, grids, tickers, UI controls Dashboard components

MANUFACTURING INTEGRATION
Data Services Bi-directional data access Metadata browsing XML-based data abstraction Connectors to external systems Business Logic Services Logic Integration services Notification services Calculation and data transformation Content creation

Analytic Services SPC/SQC (Six Sigma) analyses Statistical and other mathematical analyses

SAP xMII SAP xMII Visualization

Mfg. Intelligence Analytics

Mfg. Integration S95/B2MML Standard Other Standards Web Services Core Mfg Services

Data Services

Alerts

KPI

Manufacturing Intelligence

Manufacturing Integration

Web Services All services exposed as web services Includes user-defined composite services

Connectors

Business Logic Services

SAP MII Customers: Mill Products & Mining


Fabricated Metal Products Bekaert N.V. Charlotte Pipe & Foundry Company IPSCO, Inc. Allvac RTI International Metals Inc. Rexam Plc JW Aluminum Tomago Aluminium Company Ltd Alcan Inc. Jindal Stainless Ltd Grede Foundries Inc Gerdau Aos Longos S.A. Showa Denko Nippon Steel Metalcraft of Mayville Electrosteel Castings Mining and Primary Metals BHP Billiton Group Operations Inco Limited Diavik Diamond Mines Paranapanema S.A. Exxaro Resources Limited Lonmin Plc Foundation Coal Corporation Rio Tinto Services Limited Peabody Energy Corporation Building Materials Armstrong Holdings, Inc. Cemex Central, S.A. de C.V. Certainteed California Portland Cement Co Johns Manville Cosentino S.L. Jaiprakash Associates Limited CSR Limited Forest Products & Paper Buckeye Technologies Inc. Georgia-Pacific Corporation Domtar Inc. Klabin S.A. Weyerhaeuser Company UPM-Kymmene Oyj SAPPI Bemis Company Inc. Albany International Corp Kimberly Clark Altivity Furniture Sauder Woodworking Company Haworth, Inc. Textile Production Balta Industries NV Milliken

SAP Environmental Compliance (EC)


Cross-Industry
Health & Safety Services- HSS
OH Occupational Health IHS Industrial Hygiene and Safety HSM Hazardous Substance Management

Industry Specific
Product Compliance-CSM
PS Product Safety DG Dangerous Goods Management WM Waste Management Emissions and Compliance Management Product Compliance

SAP SAP EM EM
Emissions Emissions and and Compliance Compliance Management Management

CfP CfP
Compliance Compliance for for Products Products

SAP SAP EH&S EH&S Comprehensive Comprehensive and and complete complete business business solution solution for for environment, environment, health health and and safety safety management management

SAP EH&S Solution SAP EH&S offers comprehensive and complete business solution for environment, health and safety management!
Functional overview Product Safety * Hazardous Substance Management ** Dangerous Goods Management Industrial Hygiene and Safety Waste Management Occupational Health EH&S Analytics / EH&S Reporting
Employee Work areas Substance / Material

* for producers of hazardous substances ** for users of hazardous substances

One solution for all industries

SAP EH&S Occupational Health - Medical Service Data


Questionnaire Documents Questions
Answers Type Size

General info
Name of the person Date Name of physician Status Results Comment

Examinations
Name, Type Rating

Vaccinations
Name, Type Frequency, next date Name, Type Date

Medical service
Name Type Frequency-Type

Case history

Medical measures
Name, Type Date

Injury/Illness Log
Name of the person Date Name of physician Injury/Illness Transferral Comment

Diagnosis
Diagnosis-Code (eg. ICD 10) Date Comment Significance

Consultation
Name, Type Date

Restrictions
Duration CommentPrococol Physician Comment

Med. Test Results


Name of test

result

Rating Measurement value Interface to medical devices

SAP EM - Capabilities

SAP EM Compliance Compliance and and Emissions Emissions Management Management


Compliance Compliance Management Management Permit Permit Management Management Emissions Emissions Management Management
Greenhouse Greenhouse Gas Gas

Management Management
GHG-Monitoring GHG-Monitoring Allowance Allowance Mgmt Mgmt National National Allocation Allocation Plan Plan (NAP) (NAP) Reporting Reporting Inventory Inventory Trading Trading

Data Data Monitoring Monitoring Task Task Monitoring Monitoring Exception Exception Tracking Tracking Reporting Reporting

Application Application Support Support Change Change Management Management Reporting Reporting

Emissions Emissions Monitoring Monitoring Compliance Compliance Tracking Tracking Regulatory Regulatory Reporting Reporting

Compliance

Emissions

SAP Emissions Management


Overview of SAP Emissions Management Modeling and Analysis
Structured representation of facilities and processes Automated estimation of complex emissions data Definition and application of forecast scenarios

Compliance And Management


Definition, allocation and control of measures and interactive processes Role-based task and work-flow management Interaction with internal/external structures (e.g., maintenance)

Reporting and Documentation


Analysis and presentation of scenarios and data Template-based, import-/export functionality Automated generation and distribution of data and reports

Cross Functional
Performance
Support of incident/accident-management Data source for corporate environmental reporting Support of audit-trails Interfaces to market places and trading platforms, e.g. GHG-trading

IT-Structure
Optimal Integration in SAP ERP Modules Flexible integration in heterogeneous Infrastructures Web-based, adaptable user interface Stand-alone solution with new Java-based SAP technology SAP NetWeaverTM

Cement Industry: Case Studies

Ultratech Cement (L&T Cement): SAP ERP


Company Location Industry Products/Services Revenue Employees Web Site SAP Solutions and Services www.ultratechcement.com SAP R/3 FI, CO, MM, SD, PP Ultratech Cement India Mill products Cement INR 3300 Cr.

Ultratech Cement is a subsidiary of Grasim Industries, and with Grasim Cement, it is the largest producer of cement in India and 11th largest in the world.

Objectives
Simplifying the handling of complex pricing, invoicing and Distribution processes Reduced physical delivery time for moving material out of the plant Reduced Inventory at warehouses Reduced manpower for various processes in Stores, Purchase and Accounts Better decision making at the top management Level Streamlining of accounting activities Standardization of processes across the country

Benefits
Easier delivery processing On-line dispatch information Freight monitoring Delivery tracking Effective transporter billing system Transporter billing taking shortages / damages into account Tracking of every individual delivery up to payment of transporter bill Easy tracking of reallocation deliveries Automatic price approval mechanism Automatic generation of alphanumeric code in customer master Automatic generation of credit / debit notes for rate difference Transparency of information at operational level to satisfy customer orders

Grasim Cement: mySAP ERP


Company Location Industry Products/Services Revenue Employees Web Site SAP Solutions and Services www.grasim.com mySAP ERP 2004: FI, CO, MM, SD, PP, HR, BIW Grasim Cement India Mill products Cement

Grasim Cement is a subsidiary of Grasim Industries, and produces various grades of Grey and White Cement.

Objectives
Integration of all the depots with the Central Marketing office to facilitate the online placement of orders and for monitoring the dispatch position To be an industry benchmark in truck turnaround time Reduction in procurement cost Enhancing efficiency in the batch management throughout the supply chain Flexibility in report generation and decisionmaking Improve the hire-to-retire processes of employee management

Benefits
With SAP as a tool, a systematic process of demand projection and timely communication was established that, in turn, enables the unit to maintain consistently a high delivery performance in terms of timely supply of the right quality and quantity of Cement at the right place Reduced the internal truck turnaround time from 2.25 to 1.38 hrs Better visibility of suppliers quality and cost performance Greater inventory visibility across Dumps and stocking locations SAP BIW enhanced the reporting and analysis capabilities across various levels of the organization

Holcim White LTD: SAP CRM / Mobile Sales

Cementos Bio Bio: SAP Netweaver


PROJECT OBJECTIVE Create a comprehensive Web-services-based infrastructure to enhance control over processes, and to support growth strategies

Based in Santiago, Chile, Cementos Bio Bio produces a wide range of products, from cement to forest products and ceramics. The company is using the SAP NetWeaverTM to create a comprehensive Webservices-based infrastructure to enhance control over processes, and to support growth strategies.

KEY CHALLENGES Integrate new systems and new process while supporting acquired companies Enhance control over varied and geographically dispersed processes Manage documents more effectively Streamline information flow and enable collaboration

IMPLEMENTATION HIGHLIGHTS Deployed portal-based document management system Implemented comprehensive Web services platform Deployed analytic and reporting capabilities

Cementos Bio Bio: SAP Netweaver


KEY BENEFITS Better information access for decision makers Infrastructure that can support growth and acquisitions Improved control over documents Enhanced collaboration

"Beyond any single capability, SAP Netweaver gives Cementos Bio Bio a Web services platform for connecting everything."
Jose Villegas, IT Manager, Cementos Bio Bio

SAP SOLUTION SAP NetWeaver, including SAP Enterprise Portal with knowledge management capabilities and SAP Web Application Server components

RMC Group: SAP ERP


Business Organisation
RMC Group is the world's fourth largest building materials company, measured by turnover, over 5 billion in 2001. The company employs over 31,500 people at nearly 2,400 locations in 27 countries. RMCs' International Headquarters are located in the UK at Thorpe, Surrey.

Lines of Business
Aggregates include sand, gravel and various grades of stone and rock. RMC operates over 400 quarries and sand and gravel deposits. Cement is a mixture of clay and limestone burnt in a kiln. The RMC Group operates 20 cement plants in Australia, Croatia, Germany, Latvia, Poland, Great Britain and the USA with an annual capacity of 20 million tonnes, making the Group the worlds 10th largest producer. Concrete RMC manufactures a wide range of precast and prestressed concrete products in nine countries.

SAP Deployment
4800 users across Europe (growing to 5500 in the coming months) One SAP system per country shared by each line of business (UK, Fr, Ger/Aus, Den, Sp, Por, Cro, Pol) Hardware operations outsourced to Debis. Scope: Finance, Costing, Materials Management, Sales & Distribution, Production Planning and Business Intelligence (FI, CO, MM, SD, PP, BI) Heritage country-based SAP and nonSAP systems migrating to an SAP template with common data standards. Local flexibility for legal reporting and local processes. USA considering adopting the SAP template from the UK (currently 19 different legacy systems). Considering SAP Strategic Enterprise Management (SEM) and Plant Maintenance

Company Strategy
Vertically integrated in aggregates, concrete and cement Generate improved returns by achieving the full synergies of integration Make customer focus an overriding business principle Be the lowest cost producer in our core products Operate in mature growth markets Ensure the sharing of best practice while at the same time maintaining our decentralised culture

Global Organisation
UK HQ

Benefits
Consolidation of business operations (e.g. UK down from 25 businesses) Reduction of call dispatch centres (aim for one per country) Support acquisitions strategy through ease of integration of new business operations

Country

Country Country

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