SAP™ ERP for the Dairy Industry
Challenges, Strategies, and Benefits The Solution
Challenges, Strategies, and Benefits The Solution
The Dairy Industry Ecosystem Farmer Tank Truck Dairy Production Retailer Dairy Cooperatives Authorities External Laborator...
Dairy Companies Often Have the Right Focus and the Right Strategies… YOUR FOCUS Increase Shareholder Value Increase Revenu...
… But Mostly They Lack the Ability to Execute A business enabler is required to help the organization refocus on business ...
Market Forces and Business Needs <ul><li>Market Forces </li></ul><ul><li>Retailer power (Wal-Mart effect) </li></ul><ul><l...
Develop New Products Faster and More Effectively  Benefits <ul><li>Faster development by  creating reusable product specif...
Optimize Supply Chain Benefits <ul><li>Improved operations excellence </li></ul><ul><li>Lower capital commitment </li></ul...
Increase Efficiency in Procurement Benefits <ul><li>Increased demand planning accuracy </li></ul><ul><li>Consistent intern...
Optimize Manufacturing Benefits <ul><li>Improved asset utilization </li></ul><ul><li>Increased profitability of produced p...
Ensure Food Safety and Regulatory Compliance Benefits <ul><li>Reduced penalty risk </li></ul><ul><li>Decreased risk of foo...
Improve Sales Efficiency Benefits <ul><li>Higher sales volume </li></ul><ul><li>Better account retention </li></ul><ul><li...
Challenges, Strategies, and Benefits The Solution
SAP ERP packaged solution for the dairy industry Business Objectives <ul><li>Define business strategy and goals </li></ul>...
SAP ERP packaged solution for the dairy industry Manufacturing   Dairy Production Planning  Dairy Process Control  Supplie...
Generic Food Scenarios Suppliers & Partners  Customers (e.g. Retailers) & Channel Partners  Analyze, Plan & Develop  Procu...
Procure to Stock <ul><li>Industry Pain Points </li></ul><ul><li>Improving purchasing activities efficiency </li></ul><ul><...
Internal Procurement <ul><li>Industry Pain Points </li></ul><ul><li>Improving internal purchasing activities </li></ul><ul...
Sales Order Processing <ul><li>Industry Pain Points </li></ul><ul><li>Managing variable pricing conditions  </li></ul><ul>...
Returns <ul><li>Industry Pain Points </li></ul><ul><li>Efficient handling & document  complaints. </li></ul><ul><li>Managi...
Traceability and Food Safety <ul><li>Industry Pain Points </li></ul><ul><li>Complying  with food regulations  </li></ul><u...
Inventory Management <ul><li>Industry Pain Points </li></ul><ul><li>Maintaining low inventory levels </li></ul><ul><li>Avo...
Financials and Controlling <ul><li>Industry Pain Points </li></ul><ul><li>Meeting local legal and fiscal requirements </li...
Our Specific Solution Offering for the Dairy Industry  Suppliers & Partners  Customers (e.g. Retailers) & Channel Partners...
Product Development with Recipe Management <ul><li>Industry Pain Points </li></ul><ul><li>Slow and inefficient product dev...
Milk Procurement from the Producer <ul><li>Industry Pain Points </li></ul><ul><li>Managing the complex payment conditions ...
Additional Raw Material Procurement <ul><li>Industry Pain Points </li></ul><ul><li>Determining demand for additional requi...
Dairy Production Planning and Process Control <ul><li>Industry Pain Points </li></ul><ul><li>Production Planning based on ...
Raw Material Sales <ul><li>Industry Pain Points </li></ul><ul><li>Managing variable pricing conditions based on quality ch...
SAP ERP for the Dairy Industry Provides Increased Shareholder Value for Your Business Reduce operating costs and increase ...
<ul><li>No part of this publication may be reproduced or transmitted in any form or for any purpose without the express pe...
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  • Chapter 1. This chapter has the intention to first gain customer confidence by prooving industry experience. Secondly it describes the food industry specific key company targets and Beveage specific industry trends. Thirdly it explains the resulting key challenges for a food company and how SAP can help the customer with those challenges. The intention of this slide content and flow is to identify the customer specific issues and to give the cusomer the confidence, that SAP can help with the improvement of tis sitution. Be aware,that not all challenges are covered with preconfigured Best practice cotent. Chapter 2. This chapter describes the SAP ERP food packaged solution content in matter of preconfigured scenarios/processes. This means that the functionality contained in this chapter is part of the SAP ERP food packaged solution. Chapter 3. This chapter describes the approach how the business scenarios/processes are made available to the customer via the Best Practice approach (BC sets,…). Furthermore it describes with which effort it can be implemented and how the customer gets supported by the packaged solution tools/bill of material. Chapter 4. This chapter shows statistics, customer quotes/references/success stories and implementation success stories. This is in order to convince the customer that SAP and Deloitte are the rigt business partners regarding their company stability, as software provider and as implementation company. Chapter 5. Summary f chapter 1.-4.
  • Chapter 1. This chapter has the intention to first gain customer confidence by prooving industry experience. Secondly it describes the food industry specific key company targets and Beveage specific industry trends. Thirdly it explains the resulting key challenges for a food company and how SAP can help the customer with those challenges. The intention of this slide content and flow is to identify the customer specific issues and to give the cusomer the confidence, that SAP can help with the improvement of tis sitution. Be aware,that not all challenges are covered with preconfigured Best practice cotent. Chapter 2. This chapter describes the SAP ERP food packaged solution content in matter of preconfigured scenarios/processes. This means that the functionality contained in this chapter is part of the SAP ERP food packaged solution. Chapter 3. This chapter describes the approach how the business scenarios/processes are made available to the customer via the Best Practice approach (BC sets,…). Furthermore it describes with which effort it can be implemented and how the customer gets supported by the packaged solution tools/bill of material. Chapter 4. This chapter shows statistics, customer quotes/references/success stories and implementation success stories. This is in order to convince the customer that SAP and Deloitte are the rigt business partners regarding their company stability, as software provider and as implementation company. Chapter 5. Summary f chapter 1.-4.
  • food Companies: Softdrink manufacturers delivering concentrate to a bottler company
  • Chapter 1. This chapter has the intention to first gain customer confidence by prooving industry experience. Secondly it describes the food industry specific key company targets and Beveage specific industry trends. Thirdly it explains the resulting key challenges for a food company and how SAP can help the customer with those challenges. The intention of this slide content and flow is to identify the customer specific issues and to give the cusomer the confidence, that SAP can help with the improvement of tis sitution. Be aware,that not all challenges are covered with preconfigured Best practice cotent. Chapter 2. This chapter describes the SAP ERP food packaged solution content in matter of preconfigured scenarios/processes. This means that the functionality contained in this chapter is part of the SAP ERP food packaged solution. Chapter 3. This chapter describes the approach how the business scenarios/processes are made available to the customer via the Best Practice approach (BC sets,…). Furthermore it describes with which effort it can be implemented and how the customer gets supported by the packaged solution tools/bill of material. Chapter 4. This chapter shows statistics, customer quotes/references/success stories and implementation success stories. This is in order to convince the customer that SAP and Deloitte are the rigt business partners regarding their company stability, as software provider and as implementation company. Chapter 5. Summary f chapter 1.-4.
  • Dairy overview

    1. 1. SAP™ ERP for the Dairy Industry
    2. 2. Challenges, Strategies, and Benefits The Solution
    3. 3. Challenges, Strategies, and Benefits The Solution
    4. 4. The Dairy Industry Ecosystem Farmer Tank Truck Dairy Production Retailer Dairy Cooperatives Authorities External Laboratories Raw Material, Packaging, Service Wholesaler Distr. Centers Broker Collect Raw Milk Sell Raw Material and Ingredients Supplier Add. Purchase of Raw Material / Raw Milk
    5. 5. Dairy Companies Often Have the Right Focus and the Right Strategies… YOUR FOCUS Increase Shareholder Value Increase Revenue and Profit Margins Operational Excellence Product Leadership Improve Customer Satisfaction <ul><ul><li>Protect and enhance revenue </li></ul></ul><ul><ul><li>Improve margins </li></ul></ul><ul><ul><li>Drive for lower costs </li></ul></ul><ul><ul><li>Get closer to the consumer </li></ul></ul><ul><ul><li>Improve time-to-market </li></ul></ul><ul><ul><li>Enhance operational efficiency </li></ul></ul>YOUR FOCUS Increase Shareholder Value Increase Revenue and Profit Margins Cost Leadership Product Leadership Improve Customer Satisfaction Business STRATEGY
    6. 6. … But Mostly They Lack the Ability to Execute A business enabler is required to help the organization refocus on business strategies! Often employees cannot execute the company’s business strategy because the business platform is … <ul><li>COMPLICATED TO OPERATE </li></ul><ul><li>Complex and broken process flows </li></ul><ul><li>Incomplete or hidden information </li></ul><ul><li>DIFFICULT TO CONTROL </li></ul><ul><li>Lack of visibility </li></ul><ul><li>Lack of traceability </li></ul><ul><li>CHALLENGING TO CHANGE </li></ul><ul><li>Multiple costly integration points </li></ul><ul><li>Redundant and inconsistent data </li></ul>Business STRATEGY Ability to EXECUTE Business Enabler
    7. 7. Market Forces and Business Needs <ul><li>Market Forces </li></ul><ul><li>Retailer power (Wal-Mart effect) </li></ul><ul><li>Consumer concerns about food safety; media attention </li></ul><ul><li>Increased legislation and regulations around food safety by FDA and other authorities (e.g., EU Dir. 178/2002, the U.S. Bioterrorism Act of 2002) </li></ul><ul><li>Changing consumer demands due to demographics and trends </li></ul><ul><li>Shorter product life cycles </li></ul><ul><li>Extreme price pressure and margin erosion </li></ul><ul><li>Restrictive consumer spending pattern </li></ul><ul><li>Market consolidation (globalization, M&As) </li></ul><ul><li>Increasing competition </li></ul><ul><li>Emerging private labels </li></ul><ul><li>New technologies reshaping the industry </li></ul><ul><li>Resulting Key Challenges </li></ul><ul><li>Develop new products faster and more effectively </li></ul><ul><li>Optimize supply chain </li></ul><ul><li>Increase efficiency in procurement </li></ul><ul><li>Optimize manufacturing </li></ul><ul><li>Ensure food safety and regulatory compliance </li></ul><ul><li>Improve sales efficiency </li></ul>
    8. 8. Develop New Products Faster and More Effectively Benefits <ul><li>Faster development by creating reusable product specifications </li></ul><ul><li>Reduced time-to-market </li></ul><ul><li>Ensured competitive advantage </li></ul>Strategies <ul><li>Enable collaborative engineering </li></ul><ul><li>Consolidate product development data and documents </li></ul><ul><li>Reduce development effort and time-to-market </li></ul>SAP ® can help you <ul><li>Integrate all product-related information </li></ul><ul><li>Reduce data redundancy and inconsistency </li></ul><ul><li>Integrate into manufacturing process </li></ul>Challenges <ul><li>Adapt to ever-changing consumer tastes and requirements </li></ul><ul><li>Develop product efficiently </li></ul><ul><li>Address increased demands for new products </li></ul>
    9. 9. Optimize Supply Chain Benefits <ul><li>Improved operations excellence </li></ul><ul><li>Lower capital commitment </li></ul><ul><li>Reduced operating costs </li></ul><ul><li>Higher customer satisfaction </li></ul>Strategies <ul><li>Reduce costs </li></ul><ul><li>Streamline supply chain processes </li></ul><ul><li>Improve supply chain control </li></ul><ul><li>Gain more supply chain visibility </li></ul>SAP ® can help you <ul><li>Optimize distribution processes </li></ul><ul><li>Optimize end-to-end planning </li></ul><ul><li>Improve asset utilization </li></ul><ul><li>Fully integrate logistics management, including transportation and warehouse and inventory management </li></ul><ul><li>Shorten order-to-delivery cycles </li></ul>Challenges <ul><li>Decrease process costs </li></ul><ul><li>Create operational efficiencies and supply chain transparency </li></ul><ul><li>Manage shelf-life-based picking and distribution </li></ul><ul><li>Ensure accurate and timely shipments </li></ul><ul><li>Avoid out-of-stocks </li></ul>
    10. 10. Increase Efficiency in Procurement Benefits <ul><li>Increased demand planning accuracy </li></ul><ul><li>Consistent internal and external procurement reporting </li></ul><ul><li>Integrated processes </li></ul>Strategies <ul><li>Reduce costs </li></ul><ul><li>Streamline processes </li></ul><ul><li>Gain more visibility and transparency </li></ul><ul><li>Improve relationship with producers </li></ul>SAP ® can help you <ul><li>Set up integrated and flexible processes for procurement </li></ul><ul><li>Streamline raw milk collection and reception </li></ul><ul><li>Ensure integrated quality management </li></ul><ul><li>Track batches </li></ul>Challenges <ul><li>Cope with ever-changing quantity and quality of the raw milk </li></ul><ul><li>Manage complex payment conditions </li></ul><ul><li>Cope with seasonal fluctuation </li></ul><ul><li>Create operational efficiencies and transparency </li></ul>
    11. 11. Optimize Manufacturing Benefits <ul><li>Improved asset utilization </li></ul><ul><li>Increased profitability of produced product mix </li></ul><ul><li>Consistent cross-stages monitoring </li></ul><ul><li>Integrated processes </li></ul>Strategies <ul><li>Maximize raw material utilization </li></ul><ul><li>Increase demand planning accuracy </li></ul><ul><li>Streamline processes </li></ul><ul><li>Gain more visibility and transparency </li></ul>SAP ® can help you <ul><li>Set up integrated and flexible processes for manufacturing </li></ul><ul><li>Monitor raw material utilization and losses </li></ul><ul><li>Ensure integrated quality management </li></ul><ul><li>Track batches </li></ul>Challenges <ul><li>Base plans on a non-standardized raw material </li></ul><ul><li>Define optimal product mix </li></ul><ul><li>Create operational efficiencies and transparency </li></ul><ul><li>Optimize production </li></ul>
    12. 12. Ensure Food Safety and Regulatory Compliance Benefits <ul><li>Reduced penalty risk </li></ul><ul><li>Decreased risk of food-safety compensation payments </li></ul><ul><li>Reduced risk of bad reputation </li></ul><ul><li>Lower operating costs </li></ul>Strategies <ul><li>Support mid- and long-term company success by ensuring regulatory compliance </li></ul><ul><li>Set efficient processes in place to enable traceability </li></ul><ul><li>Allow targeted product recalls to minimize costs </li></ul>SAP ® can help you <ul><li>Track, monitor, and trace batches and inventory </li></ul><ul><li>Streamline procurement, production, and sales </li></ul><ul><li>Manage sales returns </li></ul><ul><li>Enable targeted product recalls </li></ul>Challenges <ul><li>Align with governmental regulations (EU 178/2002, the U.S. Bioterrorism Act of 2002, import/export) </li></ul><ul><li>Enable fast, effective product recalls </li></ul><ul><li>Track and trace from “cow to consumer” </li></ul>
    13. 13. Improve Sales Efficiency Benefits <ul><li>Higher sales volume </li></ul><ul><li>Better account retention </li></ul><ul><li>Closer customer relationship </li></ul><ul><li>Optimal sales force operation </li></ul><ul><li>Higher customer satisfaction </li></ul>Strategies <ul><li>Obtain first-hand information about the market </li></ul><ul><li>Optimize process settlement in sales </li></ul><ul><li>Increase customer service offerings </li></ul><ul><li>Increase customer satisfaction </li></ul>SAP ® can help you <ul><li>Plan, track, control, and optimize sales performance </li></ul><ul><li>Expand service processes </li></ul><ul><li>Strengthen collaboration with partners and key customers </li></ul><ul><li>Track indirect sales and customers </li></ul><ul><li>Ensure correct handling of rebates </li></ul>Challenges <ul><li>Protect market share </li></ul><ul><li>Meet increased service level expectations of customer </li></ul><ul><li>Get visibility in the sales process </li></ul><ul><li>Manage quality-based price determination for raw material sales </li></ul>
    14. 14. Challenges, Strategies, and Benefits The Solution
    15. 15. SAP ERP packaged solution for the dairy industry Business Objectives <ul><li>Define business strategy and goals </li></ul><ul><li>Understand company performance and profitability </li></ul><ul><li>Realize savings in aggregate purchasing </li></ul><ul><li>Improve purchasing efficiency </li></ul><ul><li>Ensure tracking and traceability </li></ul><ul><li>Improve manufacturing efficiency </li></ul><ul><li>Ensure quality management in manufacturing process </li></ul><ul><li>Establish closer contact with customer </li></ul><ul><li>Enhance control over delivery process </li></ul><ul><li>Improve marketing effectiveness </li></ul><ul><li>Increase sales effectiveness </li></ul>Description … Focuses on key business processes that create a baseline for future growth … Delivers immediate benefits by solving the need for system heterogeneity … Enables significant business process automation Key Performance Indicators <ul><ul><li>Order Fulfillment Rate </li></ul></ul><ul><ul><li>Raw Material Utilization and Losses </li></ul></ul><ul><ul><li>Warehousing/Distribution Costs </li></ul></ul><ul><ul><li>Gross Profit/Total Net Sales </li></ul></ul><ul><ul><li>Demand Forecast Accuracy </li></ul></ul><ul><ul><li>Inventory Turns </li></ul></ul>Complete logistical and financial integration Analyze, Plan, and Develop Procure Manufacture Market and Sell Deliver and Service
    16. 16. SAP ERP packaged solution for the dairy industry Manufacturing Dairy Production Planning Dairy Process Control Suppliers & Partners Customers (e.g. Retailers) & Channel Partners Analyze, Plan & Develop Procure Manufacture Market & Sell Deliver & Service Sourcing & Procurement Milk Procurement from Producer Additional Raw Material Procurement Procure to Stock Internal Procurement Product Development Recipe Management Sell & Deliver Sales Order Processing Raw Material Sales Returns Operational End-to-End Scenarios Traceability & Food Safety Inventory Management Quality Management Enterprise Management & Support Financials Financial Accounting Cash Management Asset Management Controlling Standard Cost & Profit Center Accounting Product Cost Planning CO-PA for Consumer Products Cost Object Controlling
    17. 17. Generic Food Scenarios Suppliers & Partners Customers (e.g. Retailers) & Channel Partners Analyze, Plan & Develop Procure Manufacture Market & Sell Deliver & Service Sourcing & Procurement Procure to Stock Internal Procurement Sell & Deliver Sales Order Processing Returns Operational End-to-End Scenarios Traceability & Food Safety Inventory Management Quality Management Enterprise Management & Support Financials Financial Accounting Cash Management Asset Management Controlling Standard Cost & Profit Center Accounting Product Cost Planning CO-PA for Consumer Products Cost Object Controlling
    18. 18. Procure to Stock <ul><li>Industry Pain Points </li></ul><ul><li>Improving purchasing activities efficiency </li></ul><ul><li>Realizing savings in purchased value </li></ul><ul><li>Allowing visibility on vendors’ conditions and services </li></ul><ul><li>Ensuring tracking and traceability </li></ul><ul><li>Supports price comparison of vendors’ offers </li></ul><ul><li>Provides tools to gain greater spend visibility in procurement </li></ul><ul><li>Helps to manage quotations, contracts, batch handling and quality </li></ul><ul><li>Business Benefits </li></ul><ul><li>Automate operational tasks </li></ul><ul><li>Improve vendors’ selection and prices comparison through quotation handling </li></ul><ul><li>Formalize agreements by contract management </li></ul><ul><li>Guarantee quality check through goods receipt inspections </li></ul>Solution Procurement of Stock materials Procurement – Contracts <ul><li>Request for quotation </li></ul><ul><li>Prices Comparison </li></ul><ul><li>Purchase requisition </li></ul><ul><li>Purchase order processing </li></ul><ul><li>Goods receipt </li></ul><ul><li>Inspect goods </li></ul><ul><li>Batch number assignment </li></ul><ul><li>Stock update </li></ul><ul><li>Invoice verification </li></ul><ul><li>Create contract: Quantity contracts; Value contracts; Delivery schedule </li></ul><ul><li>Create purchase requisition </li></ul><ul><li>Assign vendor to contract </li></ul>
    19. 19. Internal Procurement <ul><li>Industry Pain Points </li></ul><ul><li>Improving internal purchasing activities </li></ul><ul><li>Ensuring tracking and traceability </li></ul><ul><li>Encompasses cross-plant internal procurement of products including creation of all required documents for both with or without delivery </li></ul><ul><li>Provide functions to monitor stock in transit </li></ul><ul><li>Business Benefits </li></ul><ul><li>Automate operational tasks </li></ul><ul><li>Increased visibility of stock and stock transfers </li></ul>Solution Stock transfer with delivery Stock transfer without delivery <ul><li>Create stock transport order </li></ul><ul><li>Process delivery </li></ul><ul><li>Post goods issue </li></ul><ul><li>Create stock transport order </li></ul><ul><li>Post goods issue </li></ul>
    20. 20. Sales Order Processing <ul><li>Industry Pain Points </li></ul><ul><li>Managing variable pricing conditions </li></ul><ul><li>Long order cycle times </li></ul><ul><li>Meeting customers’ requests for improved services </li></ul><ul><li>Managing sales returns cost effectively </li></ul><ul><li>Manage the entire customer order process — variable pricing, delivery, invoicing, and payment. </li></ul><ul><li>Includes Electronic Data Interchange (EDI), handling of consignment sales, and foreign trade </li></ul><ul><li>Business Benefits </li></ul><ul><li>Improve sales execution timeline </li></ul><ul><li>Improve order fulfillment rate </li></ul><ul><li>Provide the customer with alternative services and methods for invoicing and payments </li></ul>Solution Sales Distribution <ul><li>Process sales order </li></ul><ul><li>Billing </li></ul><ul><li>Payment </li></ul><ul><li>Picking & distribution based on shelf life expiration date </li></ul><ul><li>Freight settlement </li></ul><ul><li>Handling unit mgt. </li></ul>Inbound/Outbound EDI Processing <ul><li>Inbound sales order via EDI </li></ul><ul><li>Outbound billing document via EDI </li></ul>
    21. 21. Returns <ul><li>Industry Pain Points </li></ul><ul><li>Efficient handling & document complaints. </li></ul><ul><li>Managing sales returns cost efficiently. </li></ul><ul><li>Focuses on the processing of credit memos if no goods are sent back. </li></ul><ul><li>Includes quality evaluation for returned goods and appropriate stock movement. </li></ul><ul><li>Business Benefits </li></ul><ul><li>Enable corporate compliance strategy </li></ul><ul><li>Effective batch-specific returns processing </li></ul>Solution Returns and Complains Returns Processing <ul><li>Process credit memos </li></ul><ul><li>Quality evaluation </li></ul><ul><li>Goods movement to blocked or unrestricted stock. </li></ul><ul><li>Ship pallets </li></ul><ul><li>Return pallets </li></ul>
    22. 22. Traceability and Food Safety <ul><li>Industry Pain Points </li></ul><ul><li>Complying with food regulations </li></ul><ul><ul><li>HACCP (Hazard Analysis & Critical Control Points) </li></ul></ul><ul><ul><li>EU (Article 18 of Regulation 178) </li></ul></ul><ul><ul><li>US (the US Bio-terrorism Act 2002) </li></ul></ul><ul><li>Addressing growing food-safety concerns from consumers </li></ul><ul><li>Business Benefits </li></ul><ul><li>Professionally managing a possible product recall </li></ul><ul><li>Minimize risk of non-compliance with food & beverage regulations </li></ul><ul><li>Effective batch-specific returns processing </li></ul>Solution Quality Management Batch Management <ul><li>Capability to track and trace products at all stages of production, processing, and distribution </li></ul><ul><li>Allow fast and efficient recall of a defective product batch </li></ul><ul><li>Quality planning </li></ul><ul><li>Quality inspection </li></ul><ul><li>Recording of laboratory analysis </li></ul><ul><li>Quality reporting </li></ul><ul><li>Quality improvement </li></ul><ul><li>Batch creation and determination </li></ul><ul><li>Batch-where-use lists </li></ul><ul><li>Recall batches and create follow-up activities </li></ul><ul><li>Manage batch-specific return processing </li></ul><ul><li>Manage batches based on shelf life expiration </li></ul>
    23. 23. Inventory Management <ul><li>Industry Pain Points </li></ul><ul><li>Maintaining low inventory levels </li></ul><ul><li>Avoiding out-of-stock situations at retailers </li></ul><ul><li>Establishing visibility to inventory levels throughout the entire supply chain </li></ul><ul><li>Business Benefits </li></ul><ul><li>Reduce working capital by keeping inventory levels low </li></ul><ul><li>Increase sales by reducing out-of-stock situations </li></ul><ul><li>Improve consumer retention due to product availability </li></ul>Solution Inventory Management <ul><li>Consists of the whole procurement and delivery cycle with warehouse for the storage management, including quality inspection </li></ul><ul><li>Return rejected goods to the vendor </li></ul><ul><li>Integration with supply chain accounting </li></ul><ul><li>Goods receipt </li></ul><ul><li>Goods issues </li></ul><ul><li>Managing different stock categories </li></ul><ul><li>Inventory valuation </li></ul>Transportation Management <ul><li>Plan transports </li></ul><ul><li>Monitor execution </li></ul><ul><li>Calculate costs </li></ul><ul><li>Manage transportation settlement </li></ul>Warehouse Management <ul><li>Storage Management </li></ul><ul><li>Quality Management </li></ul><ul><li>Quality Inspection </li></ul><ul><li>Return of goods </li></ul>
    24. 24. Financials and Controlling <ul><li>Industry Pain Points </li></ul><ul><li>Meeting local legal and fiscal requirements </li></ul><ul><li>Improving administrative activities efficiency </li></ul><ul><li>Maintaining focus on most profitable customers and brands </li></ul><ul><li>Business Benefits </li></ul><ul><li>Implement an ERP solution fully compliant and continuously updated with local legal and fiscal requirements </li></ul><ul><li>Improve efficiency in accounting activities due to a seamless process integration </li></ul><ul><li>Enhance company profitability analysis through profit and loss calculation </li></ul>Solution Financials Controlling <ul><li>Helps to get an insight into all aspects related to accounting and controlling </li></ul><ul><li>Provides streamlined functionalities that allows visibility, increases productivity and regain control of their business processes </li></ul><ul><li>General Ledger accounting </li></ul><ul><li>Accounts payable accounting </li></ul><ul><li>Accounts receivable accounting </li></ul><ul><li>Bank accounting </li></ul><ul><li>Closing activities </li></ul><ul><li>Cash management </li></ul><ul><li>Assets management </li></ul><ul><li>Standard cost and profit center accounting </li></ul><ul><li>Profitability analysis </li></ul><ul><li>Product costs planning </li></ul><ul><li>Product cost controlling </li></ul>
    25. 25. Our Specific Solution Offering for the Dairy Industry Suppliers & Partners Customers (e.g. Retailers) & Channel Partners Analyze, Plan & Develop Procure Manufacture Market & Sell Deliver & Service Sell & Deliver Sales Order Processing Returns Operational End-to-End Scenarios Traceability & Food Safety Inventory Management Quality Management Food Sourcing & Procurement Procure to Stock Internal Procurement Enterprise Management & Support Financials Financial Accounting Cash Management Asset Management Controlling Standard Cost & Profit Center Accounting Product Cost Planning CO-PA for Consumer Products Cost Object Controlling Manufacturing Milk Procurement from Producer Additional Raw Material Procurement Product Development Recipe Management Dairy Production Planning & Process Control Raw Material Sales Dairy
    26. 26. Product Development with Recipe Management <ul><li>Industry Pain Points </li></ul><ul><li>Slow and inefficient product development </li></ul><ul><li>Changing consumer tastes and requirements </li></ul><ul><li>Increasing demand for new products </li></ul><ul><li>Business Benefit </li></ul><ul><li>Reduce development cycle time & costs </li></ul><ul><li>Ensure company-wide consistent product information </li></ul><ul><li>Reduce time-to-market to gain competitive advantage </li></ul>Solution Product Data Management Product Lifecycle Management <ul><li>Managing the fast and efficient product development by structured re-usable product specifications </li></ul><ul><li>Seamless integration into the production planning and execution process </li></ul><ul><li>Maintain product specifications </li></ul><ul><li>Label Management </li></ul><ul><li>Multilevel recipe mgt. </li></ul><ul><li>Define Batch Management </li></ul><ul><li>Document Management </li></ul><ul><li>Change Management </li></ul><ul><li>Integrate Recipe into production process </li></ul><ul><li>Create master recipe </li></ul><ul><li>Create process order </li></ul>
    27. 27. Milk Procurement from the Producer <ul><li>Industry Pain Points </li></ul><ul><li>Managing the complex payment conditions </li></ul><ul><li>Coping with seasonal fluctuation and changing demands </li></ul><ul><li>Complying with the high quality standards and traceability requirements </li></ul><ul><li>Business Benefits </li></ul><ul><li>Enable accurate payment both for producer and transport service provider </li></ul><ul><li>Provide payment reporting to the producer </li></ul><ul><li>Streamline raw milk collection & reception process </li></ul>Solution Milk Collection Milk Reception Milk Analysis Milk Payment Reporting & Analysis <ul><li>Encompasses the efficient procurement and collection of raw milk </li></ul><ul><li>Ensure compliance with high quality standards and traceability requirements </li></ul><ul><li>Calculate payments based on quantity and quality characteristics </li></ul><ul><li>Monitor procurement and payment process </li></ul><ul><li>Maintain standard routes </li></ul><ul><li>Provide route list to truck driver </li></ul><ul><li>Dairy reception cockpit </li></ul><ul><li>Process purchase Order </li></ul><ul><li>Automatic creation of inspection lot and batch number </li></ul><ul><li>Batch management </li></ul><ul><li>Gather results of inspection lots from producer samples </li></ul><ul><li>Gather results of inspection lots from tank truck samples </li></ul><ul><li>Create usage decision for inspection lots </li></ul><ul><li>Calculate payment for producer </li></ul><ul><li>Calculate payment for transport service provider </li></ul><ul><li>Settle payment </li></ul><ul><li>Maintain payment calculation scheme </li></ul><ul><li>Monitor raw milk quantity & quality characteristics </li></ul><ul><li>Payment reporting </li></ul>
    28. 28. Additional Raw Material Procurement <ul><li>Industry Pain Points </li></ul><ul><li>Determining demand for additional required raw material due to ever-changing quantity and quality of collected raw milk </li></ul><ul><li>Managing the vendor payment based on raw material quality characteristics </li></ul><ul><li>Business Benefits </li></ul><ul><li>Increase demand planning accuracy </li></ul><ul><li>Handle the quality-based payment for the vendor </li></ul>Solution Raw Material Demand Planning Raw Material Reception Raw Material Analysis Raw Material Payment Reporting & Analysis <ul><li>Supports the additional purchase of raw materials from other companies on the determined shortage in the demand planning process </li></ul><ul><li>Calculate vendor payment based on the raw material quantity and quality characteristics. </li></ul><ul><li>Determine required additional raw materials </li></ul><ul><li>Create purchase order </li></ul><ul><li>Post goods receipt </li></ul><ul><li>Automatic creation of inspection lot and batch number </li></ul><ul><li>Batch management </li></ul><ul><li>Gather results of inspection lots </li></ul><ul><li>Create usage decision for inspection lots </li></ul><ul><li>Calculate vendor payment for additional purchased raw material </li></ul><ul><li>Settle payment </li></ul><ul><li>Maintain payment calculation scheme </li></ul><ul><li>Monitor raw material quantity & quality characteristics </li></ul><ul><li>Payment reporting </li></ul>
    29. 29. Dairy Production Planning and Process Control <ul><li>Industry Pain Points </li></ul><ul><li>Production Planning based on a non-standardized raw material </li></ul><ul><li>High cost of the raw material comparing to the total production costs </li></ul><ul><li>Defining optimal product mix in order to maximize utilization & profitablity </li></ul><ul><li>Business Benefits </li></ul><ul><li>Optimize and streamline production process </li></ul><ul><li>Increase profitability by improved visibility to raw material utilization and losses </li></ul><ul><li>Comply with the high quality standards and traceability requirements </li></ul>Solution Production Planning Process Control Quality Management Controlling & Analysis <ul><li>Manage the multilevel manufacturing processes including seamless batch and quality management </li></ul><ul><li>Incorporates the ever-changing quantity and quality of the raw material </li></ul><ul><li>Provide powerful tools to gain a cross-stages raw material controlling </li></ul><ul><li>Demand planning based on historical data </li></ul><ul><li>Production planning synchronous to sales </li></ul><ul><li>Material resource planning (without shelf-life) </li></ul><ul><li>Simulate planning </li></ul><ul><li>Graphical capacity planning </li></ul><ul><li>Maintain product master data & recipes for multilevel production </li></ul><ul><li>Batch management across all stages </li></ul><ul><li>Separate raw milk into components </li></ul><ul><li>Material valuation </li></ul><ul><li>Manage shelf-life expiration date for final products </li></ul><ul><li>Create inspection lots for semi-finished and finished goods </li></ul><ul><li>Gather results of inspection lots </li></ul><ul><li>Create usage decision for inspection lots </li></ul><ul><li>Cross-stages raw material controlling </li></ul><ul><li>Product costing </li></ul><ul><li>Batch information cockpit </li></ul><ul><li>Production information system </li></ul>
    30. 30. Raw Material Sales <ul><li>Industry Pain Points </li></ul><ul><li>Managing variable pricing conditions based on quality characteristics </li></ul><ul><li>Business Benefits </li></ul><ul><li>Simplify price determination by using the integrated batch and quality management system </li></ul><ul><li>Improve sales execution timeline </li></ul>Solution Production Sales Distribution Billing <ul><li>Supports the sales of raw materials between dairies based on the raw material requirements and the available surpluses </li></ul><ul><li>Pricing and distribution are based on the raw material quality characteristics </li></ul><ul><li>Manage process order </li></ul><ul><li>Create inspection lot </li></ul><ul><li>Process sales document </li></ul><ul><li>Picking based on quality characteristics </li></ul><ul><li>Create inspection lot for picked raw material </li></ul><ul><li>Usage decision and goods issue </li></ul><ul><li>Invoice processing </li></ul><ul><li>Price determination based on quality characteristics </li></ul>
    31. 31. SAP ERP for the Dairy Industry Provides Increased Shareholder Value for Your Business Reduce operating costs and increase efficiency Shareholder Value Revenue Growth Improve customer satisfaction Increase sales Reduce Cost Reduce Working Capital Customer service Distribution Inventory Reduce Risk Finance Procurement Production SAP Scenarios (SAP ERP for the Dairy Industry) * For further details, please refer to the SAP ERP for the Dairy Industry Brief. Comply with food regulations Improve order fulfillment Improve sales execution timeline Improve customer understanding Improve order fill rate Improve efficiencies in accounting activities Lower raw materials costs Calculate and monitor production costs seamlessly Business Opportunities Business Areas Business Objectives Utilize full track-and-trace capability Optimize inventory usage Financials and Controlling Sales and Customer Order Manufacturing Inventory Management Food Safety Indirect Sales Returns Procure to Stock Increase efficiency for sales returns Milk Procurement Improve transparency in dairy procurement Improve yield and reduce waste Product Cost Controlling Enable detailed profitability analysis Realtime access to production cost information Raw Material Sales Recipe Management
    32. 32. <ul><li>No part of this publication may be reproduced or transmitted in any form or for any purpose without the express permission of SAP AG. The information contained herein may be changed without prior notice. </li></ul><ul><li>Some software products marketed by SAP AG and its distributors contain proprietary software components of other software vendors. </li></ul><ul><li>Microsoft, Windows, Outlook, and PowerPoint are registered trademarks of Microsoft Corporation. </li></ul><ul><li>IBM, DB2, DB2 Universal Database, OS/2, Parallel Sysplex, MVS/ESA, AIX, S/390, AS/400, OS/390, OS/400, iSeries, pSeries, xSeries, zSeries, z/OS, AFP, Intelligent Miner, WebSphere, Netfinity, Tivoli, and Informix are trademarks or registered trademarks of IBM Corporation. </li></ul><ul><li>Oracle is a registered trademark of Oracle Corporation. </li></ul><ul><li>UNIX, X/Open, OSF/1, and Motif are registered trademarks of the Open Group. </li></ul><ul><li>Citrix, ICA, Program Neighborhood, MetaFrame, WinFrame, VideoFrame, and MultiWin are trademarks or registered trademarks of Citrix Systems, Inc. </li></ul><ul><li>HTML, XML, XHTML and W3C are trademarks or registered trademarks of W3C ® , World Wide Web Consortium, Massachusetts Institute of Technology. </li></ul><ul><li>Java is a registered trademark of Sun Microsystems, Inc. </li></ul><ul><li>JavaScript is a registered trademark of Sun Microsystems, Inc., used under license for technology invented and implemented by Netscape. </li></ul><ul><li>MaxDB is a trademark of MySQL AB, Sweden. </li></ul><ul><li>SAP, R/3, mySAP, mySAP.com, xApps, xApp, SAP NetWeaver, and other SAP products and services mentioned herein as well as their respective logos are trademarks or registered trademarks of SAP AG in Germany and in several other countries all over the world. All other product and service names mentioned are the trademarks of their respective companies. Data contained in this document serves informational purposes only. National product specifications may vary. </li></ul><ul><li>The information in this document is proprietary to SAP. No part of this document may be reproduced, copied, or transmitted in any form or for any purpose without the express prior written permission of SAP AG. </li></ul><ul><li>This document is a preliminary version and not subject to your license agreement or any other agreement with SAP. This document contains only intended strategies, developments, and functionalities of the SAP ® product and is not intended to be binding upon SAP to any particular course of business, product strategy, and/or development. Please note that this document is subject to change and may be changed by SAP at any time without notice. </li></ul><ul><li>SAP assumes no responsibility for errors or omissions in this document. SAP does not warrant the accuracy or completeness of the information, text, graphics, links, or other items contained within this material. This document is provided without a warranty of any kind, either express or implied, including but not limited to the implied warranties of merchantability, fitness for a particular purpose, or non-infringement. </li></ul><ul><li>SAP shall have no liability for damages of any kind including without limitation direct, special, indirect, or consequential damages that may result from the use of these materials. This limitation shall not apply in cases of intent or gross negligence. </li></ul><ul><li>The statutory liability for personal injury and defective products is not affected. SAP has no control over the information that you may access through the use of hot links contained in these materials and does not endorse your use of third-party Web pages nor provide any warranty whatsoever relating to third-party Web pages. </li></ul>Copyright 2006 SAP AG. All Rights Reserved
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