ERP Procurement Implementation at a Global Shipping Company
Case Study
ERP Procurement Implementation at a Global Shipping Company
Project
Summary
With a procurement system that was over 20 years old and based on legacy processes, the shipping company was finding it did not meet their growing needs and was proving expensive to maintain. In addition, as other companies in the group moved off the system, they were also expected to pick up an ever-increasing share of the costs. After a comprehensive selection, they decided to award the contract for a new bespoke system to their existing technical and safety ERP provider. The supplier had not met all their content and delivery requirements. Consequently, both parties had committed to a continuous improvement approach requiring significant product enhancement and required experienced project skills to manage the end-to-end implementation of the new ERP platform.
Organization
Background
Facilitating the global transport of oil and gas to meet the world’s energy needs, the company is a leading player in the product tanker industry. Operating one of the largest fleets of vessels, it employs approximately 3,000 employees worldwide. Global leaders in the commercial and technical vessel management, the company is committed to providing its customers and partners with safe, efficient, and flexible services that benefit their businesses.
Through the introduction of mobile technology on our client’s vessels and in warehouses, we were successfully able to deliver effective inventory management; resulting in savings of over $0.5m per annum.
Business
Challenge & Opportunity
The system was based on a challenging virtual platform that was under-resourced and incapable of running the new ERP software efficiently. Historically each of the vessels took individual responsibility for the supply of all its material requirements, however this resulted in an excess of redundant stock or shortages of appropriate stock. Our client needed a proper procurement system that would enable a better solution for tracking the necessary supplies as required.
Consequently, the ERP provider agreed to support the setup and configuration of new hardware purchased by the company and work together to introduce mobile technology so that the shore, vessel, and warehouse could effectively connect and communicate in real time. This enabled the organisation to have complete visibility of the supply chain with financial and process controls to manage the actual cost of inventory and minimise or optimise purchases. In addition, the company would now have a one-stop digital platform that would enable complete integration between their procurement, external finance system; and the technical and safety modules – complete with mobile accessibility.
Our
Solution
We were introduced to shape the implementation of our client’s new system by effectively planning the company’s requirements in the form of processes. Mapping out the process landscape for the end-to-end procurement environment, we established what the system requirements would be throughout. This making sure that the unique and differentiating requirements were well understood and then carried through into the system design. Our responsibility was to help manage our client’s supplier, in terms of putting in place the system that was required. We established the necessary procedures including benchmark checks so that the system was delivered significantly more effectively.
Consequently, we created functional process models in a process repository team in accordance with their system requirements. This was done in consultation with the ERP provider to take into consideration any requirement gaps and individual product development needs.
We set up and maintained a robust governance structure that enabled us to deliver quick course correction as and when was needed. And once completed, we were able to prepare the final business case and manage the project finances for both the company and the ERP provider. Throughout this, we were able to leverage the assets created in the design phase in order to manage a planned process-led user acceptance and performance testing procedure.
As the project would involve considerable change for the end users, we developed and executed a successful change management plan through effective communication and training.
BPM-D
Results
A compelling, fully costed business case that yielded the following benefits:
- Through the new collaboration environment, we were able to develop clearly defined requirements that could be successfully incorporated by the development, testing and training teams. Having significantly reduced the amount of time it took to develop the system, we ensured that it more effectively met our client’s requirements, with a much greater buy-in by the end users.
- Our client was also able to benefit from our experienced skills in project, process and change management, in order to underpin their robust governance structure. Using process-driven assets including test scenarios and scripts, these were incorporated into performance and user testing.
- The first release was successfully delivered within budget, plus we also managed the migration of approximately 1200 in-flight orders through a procedure developed in robotic process automation (RPA).
- In addition, we were able to decommission our client’s legacy system in three months which resulted in a healthy rebate.
- Overall, our client was able to benefit from a regenerated robust and scalable infrastructure that also delivered improved speed and resilience. Through the introduction of mobile technology on our client’s vessels and in warehouses, we were successfully able to deliver effective inventory management; resulting in savings of over $0.5m per annum.
From
The Paper
Process Model Conversion at Technology Organisation
Project
Summary
In four months, the company has completed its transition from UPN to BPMN to strengthen its BPM journey, implementing an optimised process capability in the organisation – 1609 processes and 252 storyboards have been migrated, reviewed, and signed off, Signavio Process Manager, Governance system and Collaboration Hub have been set up and business analysts have been trained to support the new repository.
Organization
Background
The company in focus provides IT products and services in four service areas: digital infrastructure, hybrid cloud, workspaces for tomorrow and cybersecurity. Its offerings include physical data centers as well as their management, operation, and relocation.
BPM-D built a strategy for the systematic migration of the business models and storyboards to Signavio and set up a structure to store the processes in the platform.
Business
Challenge & Opportunity
The company wanted to conduct a digital transformation of their processes and make continuous improvements. They initiated this journey by implementing the SAFe Framework to their business processes and updating roles, responsibilities and different systems used in these processes. The key business challenge was to ensure that the global organization updated their business processes meticulously and were able to identify improvements to further streamline the processes. They thus identified the need for using a Process Management tool that allowed taking advantage of the leading process improvement features.
The existing process modelling software – Nimbus (UPN format), that the company was using to create and store its processes, was outdated, and didn’t provide a collaborative and accessible approach to process management.
After a careful tool evaluation, Signavio was identified as the most suitable tool to manage the company’s repository. NTT has initiated its transition to BPMN, and BPM-D has been asked to support the first phase of the migration of 2000 process models & 500 story-boards, with consulting support to setup and launch the process repository.
Our
Solution
BPM-D built a strategy for the systematic migration of the business models and storyboards to Signavio and set up a structure to store the processes in the platform.
- Process Hierarchy and framework was set up on Signavio for efficient migration of business models.
- BPM-D created a robot to migrate the UPN Modes into BPMN which helped migrate 50 models per day to Signavio.
- Dictionary, which is a central object management repository in Signavio containing all the necessary attributes related to the business processes, was populated and attributes were linked to the relevant business models.
The initial step was to extract all processes from Nimbus as XML files and add them to One Drive. For each process, the robot extracts its data from the XML file into Excel – activity names, roles, descriptions, IT systems, attached documents, etc. and using this data, the robot fills out all required fields in Signavio for all activities and creates the BPMN. Then, if necessary, the flow of the BPMN is corrected by the BPM-D team and elements such as functional roles, activities and IT systems are linked to dictionary, intermediate links are also added manually. Finally, the BPMN is linked to the respective value chain and reviewed by the client. If any changes are needed, the BPM-D team corrects them and then publishes the model to the Collaboration Hub.
BPM-D
Results
A compelling, fully costed business case that yielded the following benefits:
- The Navigation of models made intuitive and structured
- 1/3 of roles have been deleted post clean-up
- IT systems also reduced with added descriptions and attributes
- Duplicate and blank activities are merged and reduced
- Documents categorised in 5 types for ease of navigation
- Signavio collaboration portal footfall increased
- Setup standards & governance processes for ongoing maintenance of models
From
The Paper
Efficiency Improvement through RPA at a Transport Infrastructure Developer
Case Study
Efficiency Improvement through RPA at a Transport Infrastructure Developer
Project
Summary
This fast discovery engagement analysed the ‘Invoice Matching’ process and identified pragmatic automation opportunities with annualised savings of over £400k and 50% FTE redeployment.
Organization
Background
The organisation generates ~70% of its revenue from transport infrastructure construction and urban development on a global scale. It develops mobility solutions to enhance economic competitiveness and strengthen social bonds by designing, building, and maintaining transport infrastructure and fostering urban development. The organisation also manages street lighting networks through various subsidiaries and joint ventures.
BPM-D conducted a fast Process Discovery to determine where the major bottleneck in the process of unreliable source data was. Focusing directly towards resolving issues and automating request workflows.
Business
Challenge & Opportunity
The leadership team identified the ‘Invoice Matching’ process as one that could possibly benefit from automation. However, they were in the early stages of understanding RPA and required
support in designing a solution that included automation interventions.
The Accounts Payable (AP) Team receives approximately 200k invoices per year via post, email or e-invoice in paper-based, PDF, or Electronic Data Interchange (EDI) formats. The process of matching and posting invoices to the General Ledger involves many manual tasks prone to human error resulting in late supplier payments, which subsequently impacted their ability to deliver core business operations. Overall, the process held a lot of potential opportunities for automation which would help reduce employee workload and increase efficiency.
The primary focus was initially what was described as an end-to-end process with various bottlenecks. Due to discrepancies originating from various stakeholders involved in the process, there was poor source data for the Accounts Payable Team to process which increased their workload considerably.
Additionally, the Accounts Payable Team was manually communicating across teams to resolve issues instead of maintaining a central database capturing contacts to send requests to. With multiple stakeholders, poorly managed internal databases and lack of definitive rules, information was not efficiently documented. Therefore, obtaining consistent Figures across the business for costs and savings proved challenging.
Our
Solution
- As-Is processes in the overall invoice matching area were mapped and documented at a field-level of detail. Performance issues were logged in readiness for the subsequent improvement initiatives.
- Processes were re-defined and potential automation interventions were evaluated by calculating the time and cost restitutions obtained by running process simulations.
- Process optimisation and improvement actions were documented, and 5 automation interventions were shortlisted based on value additions made to the process.
- Costed Business Case and Implementation Plan presented to client board – savings were calculated on the reduction in workload and increase in efficiency enabled by the automation interventions.
BPM-D
Results
A compelling, fully costed business case that yielded the following benefits:
- Highlighted major bottleneck in the process of unreliable source data.
- Focus redirected towards resolving issues/ exceptions in invoices and automating request workflows.
- An efficiency improvement of 69% Gradual redeployment of approximately 50% FTEs.
- The benefits to the Accounts Payable Team would produce an annual saving of over £400k.
- Immediate realisation with full payback in 6 months.
- Recognised various activities to optimise the process by standardising the supporting documentation to match the invoices.
From
The Paper
Process Mining to Drive Transformation at Police Service
Project
Summary
A UK-based police service wanted to improve response and case processing time for incidents. Together with BPM-D, they deployed process mining to analyse response data, identify bottlenecks/issues, and define potential initiatives which would improve how cases are managed.
Organization
Background
The police service in focus had an internal team dedicated to delivering Operational Excellence who recognised the value of process management. There was an established process modelling & repository management platform and they had been investigating the use of Process Mining technology to supplement this process capability. There was scope for improvement in their handling of a specific category of incidents, with potential inefficiencies in both response and case processing. The police service acknowledged this and looked to deliver this improvement, leveraging their internal process capability alongside both Subject Matter Expert and BPM-D consulting support.
BPM-D’s Rapid Process Improvement (RPI) methodology was used to define how the handling of incidents should be transformed by using a 7-step approach.
Business
Challenge & Opportunity
The Integrated Supply Chain function at the global technology company was implementing a new digital solution to assist with demand planning, supply planning, production planning, and the new S&OP processes.
With several ERPs and S&OP process maturity levels across business units from project-based items to physical containers to engine motors and parts, this company lagged capabilities to foresee Demand and effectively plan Supply and Production accordingly.
The implementation of the new digital solution to address the appropriate processes was estimated to save approximately $55M over five years, therefore fast and efficient actions were required.
This created a framework for prioritising improvements downstream and helped to focus analysis on the most critical areas of the process.
This police service uses a custom system for recording and managing incidents. This system creates event logs when used; these track what function the system has been used to perform and the time at which the function was executed. Further, rich data is also recorded which provides information such as the borough, user, and incident category, etc. The event logs and the rich attribute data for a 3-month period were extracted, anonymised, and then loaded into a process mining tool for analysis.
The subsequent analysis highlighted bottlenecks, trends, and potential areas for improvement. After validating the data interpretation with the System Owners, these insights were reviewed with process subject matter experts.
In the SME interviews, first the As-Is process was discussed to identify key, non-system driven tasks. Once there was agreement on the current processes, the data insights and SME pain points were discussed. This combination of quantitative and qualitative investigation generated a rich understanding of where transformation needed tobe delivered.
The As-Is landscape was validated through a workshop with a focused group of process stakeholders, fostering alignment and ensuring the interpretation was accurate.
Our
Solution
The Process Mining Factor:
Generate an As-Is Process
- Process models were previously built through interviewing SMEs. This meant that they showed what an organisation thought it was doing. Process mining is built off of system extracts – the data does not lie. This builds a true representation of business processes, including repetition, failure points and bottlenecks.
Analysis by Segment
- Process mining investigations can be filtered by any attribute – case category, region/team, time of incident, etc. This enables the identification of issues and trends specific to a focused segment of the organisation, allowing for focused improvement and/or benchmarking.
Track Compliance
- By using system data, you have visibility of how your organisation functions. With a continuous data feed, you can identify potential non-compliant behaviour and correct it before it is an issue. By analysing historical data, long term trends can be found and corrected.
BPM-D
Results
A compelling, fully costed business case that yielded the following benefits:
- BPMN process models for domestic abuse incident handling.
- Process Mining investigation with 3,400+ cases.
- 23 pain points and data insights.
- 20 actionable root causes.
- 13 recommended improvements.
- Templates, methodology, and coaching for building a transformation roadmap.
From
The Paper