Implementing SAP with a lean thinking approach - European Lean IT Summit 2012

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Klaus Petersen's presentation from the European Lean IT SUmmit: Implementing SAP with a Lean thinking approach. …

Klaus Petersen's presentation from the European Lean IT SUmmit: Implementing SAP with a Lean thinking approach.
More lean IT presentations and videos on www.lean-it-summit.com

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  • 1. Copyright © Institut Lean France 2012 22 & 23 November, 2012 Paris, France Implementing SAPwith a Lean thinking approach by Klaus Petersen
  • 2. Copyright © Institut Lean France 2012 22 & 23 November, 2012 Paris, FranceAgenda• Who is Solar and who am I• Our Lean journey• The Lean elements in a SAP environment• Learning’s• Questions
  • 3. Copyright © Institut Lean France 2012 22 & 23 November, 2012 Paris, France Solar in shortSolars business areas:ElectricalPlumbingRenewable Energy Solar is one of Northern Europe’s leading technical wholesalers Listed on NASDAQ OMX Copenhagen * € 1,532m revenue – approx. 3,600 people Servicing customers in 9 countries from 11 central warehouses 3 12-12-03 *2011 figures
  • 4. Copyright © Institut Lean France 2012 22 & 23 November, 2012 Paris, FranceOur approach to Lean The Solar Lean Way Lean Tools Lean System Reduction of costs Business development Solved isolated by Establishment of an overall functions Lean system adjusted to the company’s needs Tool-oriented New management form Spans the entire company Cultural change
  • 5. Copyright © Institut Lean France 201222 & 23 November, 2012 Paris, France
  • 6. Copyright © Institut Lean France 2012 22 & 23 November, 2012 Paris, FranceWhy are we involving in the Solar 8000project (SAP project)• Ensure this is a business project not an IT project –business development project• Need to unite the Solar 8000 (SAP system) and the Lean thinking.• Other Lean organization outside Solar are struggling with the SAP system in the daily work• Solar 8000 will enhance the Lean awareness in Solar• We are developing the organization in regards of process thinking• Going for the Solar Way
  • 7. Copyright © Institut Lean France 2012 22 & 23 November, 2012 Paris, FranceThe Lean elements in a SAPenvironment • Process thinking • Visual management • Monitoring • Go live model ….and focusing on behavior and habits
  • 8. Copyright © Institut Lean France 2012 22 & 23 November, 2012 Paris, FranceThink in processes Process model for Solar Core processes Product Life Cycle Main Process relations Phase in & Profit analysis Pricing Catalogues Campaigns Phase out maintenance (margin protection) Purchasing related Procure to Pay master data Sourcing Invoice verification Accounts payable Claims and returns Supplier Solar Solars Customers Receive to Ship Transportation and Goods receipt Stock optimization Pick/Pack Goods issue freight Order to Cash Accounts Sales related Order processing Delivery Billing receivable & Returns & claims master data Charge back Main support processes HR related Personnel Organizational Hire to Retire master data Administration Management E-recruiting Financial master Financial and Financial & Analytics data Accounting Fixed assests Period closing Yearly closing legal reporting Management Board Søren Larsen, CED 7 April 12, 2011 Jens Andersen, Finance Kurt Storgaard, Market SALES & MARKETING MARKET & PRODUCT FINANCE & LOGISTICS Business Human Resources DEPARTMENT Secretariat Development DEPARTMENT Lean & QA DEPARTMENT Britt Andersen Kurt Storgaard Jacob N. Horn Jens Andersen Søren Larsen Jan Rohde Laursen Division Director Sales Director Sales Director Product Grp. 1 Sales Director Heating / Water / Market Department Logistics Department IT Department Accounts Department Key Account Industry Lighting Kjeld Gade Sanitation Thomas Hestbæk Finn Kristensen Finn Kristensen Mads Peter Nielsen Ib Falkenberg Kurt Storgaard Carsten Antonisen Jimmi Berg Product Grp. 2 Supply / Service / Finance Communication Salary Department Administration Department Lasse Jægergaard Anette Buch Brian Jensen Pia Ebbesen Region East Region North Region South Region East Region East Peter Ungermann Kim Schrøder Education Søren Sørensen René Knappman Peter Pedersen Poul Erik Verner Region Manager Region Manager Region manager Sales Manager Sales Manager Product Grp. 6 Creditor Security Production Internal control Bent Frisk Department Storkøbenhavn & Lasse Jægergaard Vibeke Adsbøll Midtjylland Vest-/Midtjylland Region South Indfasning/Stamdata Jette Sarnov Midtsjælland Region South Rene Knappmann Gert Fredslund Jesper V. Jensen Lars V Lauridsen Thomas Grønbech Jimmy Berg Region Manager Sales Manager Sales Manager Sales Manager Product Grp. 3 Nordvestsjælland Industry/PLC Vedligehold Canteen Debtor Department Nordvestjylland Sønderjylland Region North Region North Jørgen Gull Lars V Kristensen Jytte Ørndrup Lone Larsen og Lolland Falster Advertising Jørgen Vester M. Th. Andersen Poul Arne Kloster John Jacobsen Leif Madsen Poul Toftgaard Sales Manager Branch Director Sales Manager Sales Manager Branch Director Product Grp. 4 Storkunder & Electric Equipment Credit control Nordjylland Sydøstjylland Product Grp. 8 Offshore Reception Bornholm Video Svend Erik Sorgenfri Ingrid B. Børnsen Henning Horsbøl Søren Blomster HWS Kristen Guldager Søren Sørensen Ebbe Vendelboe Sales Manager Sales Manager Niels Løhde Sales Manager Region Manager Energy & Product Grp. 5 Storkøbenhavn Østjylland Fyn Ventilation IBI/Comfort ventilation Carsten Knudsen Poul M. Bertelsen Peter Larsen Infrastructur Project Department Kent Bøje Jensen Nicholai Linde Sales Manager Sales Manager Sales Manager Kristian Pedersen Allan Ritter Højlund Sales Manager Sales Manager Product Grp. 7 Product Grp. 9 Lighting Communication Security Cable Cable/Marine/Offshore HWS Carsten Antonisen Bent Ole Jonsen Finn Mortensen Allan Kirkestrup Bent Pedersen Niels Løhde 8 December 3, 2012
  • 9. Copyright © Institut Lean France 2012 22 & 23 November, 2012 Paris, France Main Processes Main Process relations Product Life Cycle Profit Analysis Phase in & Pricing (margin Catalogues Campaigns Phase Out maintenance protection) Purchasing Invoice Accounts Claims and Procure to Pay Related Master Sourcing Verification Payable Returns Data Stock Transportation Receive to Ship Goods Receipt Optimization Pick/Pack Goods Issue and Freight Order to Cash Accounts Sales Related Order Returns & Delivery Billing Receivable & Master Data Processing Claims Charge backMain Support Processes HR Related Personnel Organizational Hire to Retire Master Data Administration Management E-recruiting Accounting Financial Asset Financial Treasury Financial & Analytics Master Data & Financial Management Performance Management 9 close Version 2.0 – 03.11.2011
  • 10. Copyright © Institut Lean France 2012 22 & 23 November, 2012 Paris, FranceSub Process Variants (52) Order to Cash Accounts Sales Related Order Returns & Delivery Billing Receivable & Master Data Processing Claims Charge back 020 010 Sales Quotation. 050 010 Incoming Payments. 020 020 Using 3rd Party. 050 020 Sales Period Closing. 020 030 Sale from Stock CW. 050 030 Account Statement. 020 040 Sales from Stock Drive In. 050 040 Dunning. 020 050 Sales Of Buy To Items. 050 050 Dispute Management. 020 070 Sales Order Inbound Via EDI. 050 060 Interest Note. 020 071 Sales Order Inbound Via Weblink. 050 090 Profitability Analysis. 020 080 Cash Order Flow Drive In. 050 100 Chargeback Workbench. 020 090 Rush Order Flow Drive In. 050 110 Rebate Workbench. 020 140 Sales order inbound via Hand scan (Solar Self service). 050 120 Debit Memo - Course / Services. 020 150 Consignment Fill-Up (Default). 050 130 Credit Memo - Rebate / Compensation. 020 160 Consignment Issue. 020 170 Consignment Pick Up. 020 180 Consignment Return. 040 010 Billing creation. 020 190 Sales Order Processing - Using Red Material. 040 050 Billing Block. 040 060 Cash Invoice. 060 010 Return Orders – Central Warehouse (Green materials) 060 020 Return Orders – Drive-In (un-restricted sales stock) 060 030 Return Orders – Vendor (from customer directly) 060 040 Return orders - Unknown Material (complaint)010 010 Creation of Customer Master Data. 030 010 Delivery Processing CW. 060 050 Return Orders – Vendor (from CW)010 020 Maintenance of Customer Master Data. 030 020 Delivery Processing DI. 060 060 Returnable Packaging.010 030 Create, maintain - Customer EDI Master Data. 060 070 Sales Activity Complaints Processing.010 050 Create/Maintain Customer Agreement. 060 080 Sales Activity Complaint Processing - Free of Charge.010 060 Credit Limit Check. 060 090 Sales Activity Complaint Processing - In customer Care.010 070 DnB Credit Management. 060 100 Sales Activity Complaint Processing - Return Stock.010 080 Chargeback Agreement – Create/maintain. 060 110 Sales Activity Complaint Processing - Credit Memo.010 090 Rebate Agreement – Create/maintain. 060 120 Sales Activity Complaint Processing - Debit Memo. 060 130 Return Order - Follow Up. Version 2.0 – 07.11.2011
  • 11. Copyright © Institut Lean France 2012 22 & 23 November, 2012 Paris, FranceVisual management visualize activities Study Formulatecountermeasures problem Seek root cause
  • 12. Copyright © Institut Lean France 2012 22 & 23 November, 2012 Paris, France VisualityProject Planning Week 41phase Change Management Issues/ Activities OtherMilestone KPI Problems HE HE •x LI HIChangeManagement LE LE LI HI Communication TrainingSurvey
  • 13. Copyright © Institut Lean France 2012 22 & 23 November, 2012 Paris, FranceVisual management
  • 14. Copyright © Institut Lean France 2012 22 & 23 November, 2012 Paris, FranceMonitoring-like hatches in a water pipe• Visualize the status of critical points, handovers and backlogs in our systems.• Un-hiding problems to improve our performance and create stable processes.• Embed good problem solving behavior.• Input to the go-live model – tickets in Tivoli or SharePoint.
  • 15. Copyright © Institut Lean France 2012 22 & 23 November, 2012 Paris, FranceFlow of data and information–monitoring Process boards – meetings at 11.30 to 12.30 Tickets Problem solving board Fishbone 5 x WHY We sign the standards, but we do not follow them Materials Measurements Methods Employees do not see the Standards are • Why no. 1 Benefits of “standard work” not detailed enough Goal/problem • Why no. 2 Employees have not been properly introduced to Standards are not updated Standards are made in Quality Department, Process monitoring board - [Process name] Standard work Not by process experts Prio/ID Description Who is measuring Last updated Content OK Status Value Goal Root cause Corrective action Responsible Deadline Delivery to customers • Why no. 3 Training in the company is not done according to the standards is prioritized over updating standards Monitoring point: Management Machines/IT Manpower Monitoring point: • Why no. 4 Manager is measured on timely delivery to customers. KPI: KPI: Board standard Instructions problem solving Parking lot Communication about corrective actions High priority Swimlanes + definitions Standard for board layout Agenda and rules Parking lot Data EXCEL DATABASE from SAP KPI’s/ monitoring points Printed lists from A report with all the daily monitoring of activities monitoring points Department meetings before 11 o’clock (problem solving and corrective actions) KPI’s/ monitoring points Branch meetings in the morning (problem solving and corrective actions) Printed lists from the daily monitoring of activities
  • 16. Copyright © Institut Lean France 2012 22 & 23 November, 2012 Paris, FranceSample of monitoring board
  • 17. Copyright © Institut Lean France 2012 22 & 23 November, 2012 Paris, France Layout of boards – MT level Process monitoring board - [Process name]Prio/ID Description Who is measuring Last updated Content OK Status Value Goal Root cause Corrective action Responsible Deadline Monitoring point: Monitoring point: KPI: KPI: Swimlanes + definitions Standard for board layout Agenda and rules Parking lot
  • 18. Copyright © Institut Lean France 2012 22 & 23 November, 2012 Paris, FranceT-cards T-cards are used to keep track of activities in departments or branches T-cards has two sides – green and red: Task done or task not done. The task is written on the card, the SOPs from the training material are covering the steps to take. The signal is clear – to everyone – if the task is done or not. The manager is key to making the system work, he/she have to address if the tasks or not done. Process: 1. Every morning the manager turns all cards into red. 2. During the day or at the end of the day the person assigned to the task, completes the task and turns the card to green. 3. Usually the result of the task is a list of unsolved issues. It is then the persons task to solve the issues before the day is over. The list is printed and put on the lean board. 4. Last man/woman (or the manager) controls that all tasks are in green – otherwise action must be taken. 5. Next day, errors and causes for errors on the lists are discussed at the board meeting. Number of deviations found
  • 19. Copyright © Institut Lean France 2012 22 & 23 November, 2012 Paris, France Go Live Model Support the Solar8000 End-users on problems on execution of their work relating to: – SAP IT related problems – SAP skills – Processes – SOP’s – Defects – Technical and Master Data issues – …• Ensure efficient communication about Errors / Incidents / Solutions?• Stabile information flow between End-user, Super User, LPL’s, Core, PMO, etc…?
  • 20. Copyright © Institut Lean France 2012 22 & 23 November, 2012 Paris, France Daily Team Update Meetings are supported by visual management at the lean boards.MonitoringDashboard Track your Inform your teams team via the activities incident updates (*) T-Cards for daily monitoring of activities (*) These documents are shared during the DAY VS. WEEK SU Update meeting
  • 21. Copyright © Institut Lean France 2012 22 & 23 November, 2012 Paris, FranceMeeting structure per process
  • 22. Copyright © Institut Lean France 2012 22 & 23 November, 2012 Paris, FranceLearnings • Even if people say they think in processes they still have a long way to go –it is a mind-set thing • Be patience when trying to change habits and behaviour • Leaders and managers must GO SEE, -and support and understand the process model • Involve HR –it is about people in change -change management • Focus on the vital few even if you have many projects • Make sure everyone knows the priorities • Have discipline – stick to the plan and the priorities • Don’t make it a IT project –it is business development
  • 23. Copyright © Institut Lean France 2012 22 & 23 November, 2012 Paris, FranceMore Lean IT presentations and videos on www.lean-it-summit.com