Differentiate in Commodity Markets - Illumitiillumiti.com/.../12/...products-differentiate-in-commodity-markets-pdf.pdf · Differentiate in Commodity Markets Market demand is cyclical

Executive Overview

© 2014 SAP AG or an SAP affiliate company. All rights reserved.

Mill Products

Differentiate in Commodity Markets

ExecutiveSummary

SAP Solutions SAP Innovations References Contact Us


1 / 40 © 2014 SAP AG or an SAP affiliate company.All rights reserved.

Differentiate in Commodity MarketsMarket demand is cyclical and slowing down globally. Production overcapacity, highenergy costs, commodity price volatility, and regulatory requirements expose millproducts companies to increased risk and force them to control costs.

The population in emerging markets is growing constantly, increasing in wealth and consumption.Mill products companies are profiting from this trend by providing products at the first level ofconsumption. But raw material prices are increasing and displaying increased volatility, trends thatcreate a very competitive business environment for mill products companies, with increased risk ofhigher prices and lower margins. In an attempt to secure raw material supplies and reducecommodity price risk, commodity customers are engaging in mergers and acquisitions. At thesame time, there is an increased focus on hedging of raw material and energy supplies.

In addition, commodity suppliers must monitor increasing regulatory requirements and efficientlymanage their responses to minimize the cost of compliance and the risk of supply chain disruption.

The result of these developments is the increased complexity of supply networks. A responsivenetwork that meets demands, proactively manages supply chain risks, and responds in real time tosupply chain events is essential. Competitiveness and long-term success now depend not only onlow price but a high level of customer satisfaction as well.

ExecutiveSummary


Commoditized Products

Market Situation

Business Priorities

SAP Innovations


Manage the network, achieve profitability, and limit risk.

Fulfill customer order expectations – including products that meet specifications and on-timedelivery demands – at low cost.

Achieve maximum return on assets and increase margins.

Manage production and logistics efficiently to stay competitive, secure profitability, and win in acommodity market.

Excel in the Market with Commoditized Products

SAP solutions help promote sustainable growth, profitability, and stakeholderrecognition by assisting users in optimizing asset performance, order fulfillment,and risk management.

Best-Run Mill Products


Market Situation

Business Priorities

SAP Innovations

ExecutiveSummary



Best-run mill products companies focus on the needs of their global customers. Tohelp ensure their competitiveness, they strive to develop a responsive supply chainand efficient, reliable production at low costs.

Priorities of Best-Run Mill Products Companies

Understanding the value drivers for each of these priorities is key to executing as abest-run mill products company.

Profit-Driven Supply Chain

Plant and Asset OperationsExcellence

Sustainable Customer Relationships

Human Resources

Finance

Procurement

Information Technology

Technology and Platform


Market Situation

Business Priorities

SAP Innovations

ExecutiveSummary



SAP InnovationsMill products companies struggle with overcapacity, rationalization, mergers, andacquisitions. They must translate the latest IT advances into process innovationswhile providing current service levels without disruption to the business.

SAP is making significant investments in five distinct technology areas – applications, analytics,Big Data, mobile, and cloud – to help mill products companies compress sales cycle times,minimize time to profit for new projects, and reduce manufacturing and supply chain costs.

Analytics and Big DataCompanies can maximize return on assets by using breakthrough analytics solutions from SAP, likethe SAP HANA platform. For example, SAP HANA helps track, trace, and understand offerings atthe characteristic level, to rapidly suggest alternative products.

MobileMobile apps offered by SAP enable operations to run faster and smoother by providing employeeswith access to critical information anytime, anywhere and allowing them to capture data on the spot.

CloudCloud solutions from SAP and its partners provide new ways to deliver extraordinary potential forcustomers to run their businesses better and faster. They offer low-cost and low-risk deploymentwhile providing flexibility, scalability, and integration across end-to-end business processes.


Market Situation

Business Priorities

SAP Innovations

ExecutiveSummary



Differentiate in commodity markets.

Mill Products Value Map


SAP Solutions

Plant and Asset Operations

Human Resources

Customer Relationships

Finance


Procurement


ExecutiveSummary



Integrated Business Planning

Supply Chain Planning

Inventory Visibility and Order Promising

Transportation and WarehouseManagement


Market-Driven Segmentation

Sales Performance and Enablement

B2B Commerce

Streamlined Service

Plant and Asset OperationsExcellence

Production Execution and Visibility

Asset Visibility and Performance

Asset Operations and Maintenance

Environment, Health, and Safety

Technologyand Platform

HumanResources

Core Human Resourcesand Payroll Talent Management Time and Attendance

ManagementWorkforce Planning

and Analytics

Finance Financial Planning andAnalysis

Accounting andFinancial Close

Treasury and FinancialRisk Management

Collaborative FinanceOperations

Enterprise Risk andCompliance Management

Procurement Strategic Sourcing andSupplier Management

Procure to Pay withBusiness Network

Collaboration

Business NetworkExtensions forProcure to Pay

InformationTechnology

Application LifecycleManagement

IT InfrastructureManagement

IT Portfolio and ProjectManagement IT Service Management IT Strategy and

Governance

EnterpriseMobilityBig Data Real-Time

EnterpriseReal-TimeAnalytics

EnterpriseInformation

Management

ApplicationIntegration Cloud Solutions

Supply Chain Monitoring

Commodity Management

Energy and Environmental ResourceManagement

Quality Management and Compliance

Order and Contract Managementfor Configurable Products


Mill products companies face major challenges inmanaging their complex supply chains. Mergers andacquisitions and globally dispersed sites require robustsupply chain management. On-time delivery is criticalto survival.


Mill products companies are experiencingintense economic change. Networks arebecoming more complex. Companies aresubcontracting and outsourcing operations.Customers expect on-time delivery in full. Ordercycles are becoming shorter. Managementof the whole network – integrated planning,execution, and management of all plantactivities associated with sourcing, procurement,manufacturing, and logistics management – isbecoming critical to success.

The ability to answer customer requests in afast, precise, and reliable manner presentsan opportunity to improve sales margins byincreasing customer confidence.

Fluctuations of raw materials and energypresent another opportunity for supply chainprofitability. Even small price differences canhave significant impact on overall profitability.A well-managed supply chain is the key tobetter control, profitability, and competitiveness.

96%On-time delivery performancereported by top 25%companies, versus 89% byaverage organizations in millproducts industrySource: SAP PerformanceBenchmarking

Priorities


SAP Solutions

SAP Solutions

ExecutiveSummary



BenefitsFlexible sales and operations planningBetter delivery performanceIncreased customer satisfaction

Clear global view of inventoryLower financial riskLower production and transportation costs

Profit-Driven Supply ChainManage the supply chain from purchase to delivery at customer sites.Stay profitable and competitive by managing the supply chain proactively withreal-time insights. Focus on customer satisfaction while controlling risk and costs.

6%Higher on-time deliveryperformance for mill productscompanies that integrateorder promising with keytrading partnersSource: SAP PerformanceBenchmarking

Integrated BusinessPlanning Use an efficient analysis of Big Data to improve forecasting and planning.

Supply Chain Planning Manage supply chains based on accurate real-time data to keep risk low andmaintain profitability.

Inventory Visibility andOrder Promising

Provide flexible but precise responses to customer requirements with easieraccess to the real status of inventory and production.

Transportation andWarehouse Management Increase customer satisfaction by producing and delivering on time.

Supply Chain MonitoringMonitor the supply chain to enable real-time analysis, insight into segmentedbusiness policies, and visibility to alerts based on key performance indicators(KPIs), performance, and current supply chain setup.

Commodity Management Diminish financial risk by controlling the commodity price risk.

Priorities

SAP Solutions


SAP Solutions

ExecutiveSummary



Mill companies must maximize the utilization,performance, and output of their highly capital-intensiveassets, while keeping track of costs, quality, energyconsumption, worker safety, and the environment.

Plant and Asset Operations Excellence

Holistically managed modern mill operationscan run sustainably only through the closeintegration of manufacturing, maintenance, andoperational risk-management activities. Tomanage assets efficiently and maximizereturns, mill companies must streamlinemanufacturing and maintenance processesacross the value chain via end-to-end businessprocess integration and automation.

To maintain a competitive edge, mill companiesmust continuously improve efficiencies in themanufacturing process. Clear visibility into allaspects of operations supports faster and moreinformed decision making. Machines andqualified personnel are key elements forsuccess, as are detailed tracking of productsduring production, delivery, and customer use.

14%Higher operating equipmenteffectiveness reported by top25% companies than averageorganization in mill productsindustrySource: SAP PerformanceBenchmarking

Priorities


SAP Solutions

SAP Solutions

ExecutiveSummary



BenefitsMaximize sustainable return on assetsGain high performance and low costsConsistently create best products

Improve worker safetyTrack originsLower energy consumption

Plant and Asset Operations ExcellenceMaximize return on assets with higher use while enabling safe operations.An effective asset management program minimizes overall maintenance costs andsimultaneously increases worker safety. This is the base for efficient production.

20%Higher asset capacityutilization reported by millproducts organizations withmature plant maintenanceprocessesSource: SAP PerformanceBenchmarking

Production Execution andVisibility

Gain greater visibility into and control over manufacturing by integratingplant-floor systems with core enterprise applications.

Asset Visibility andPerformance

Provide visibility into equipment performance, condition, and status,enabling prompt corrective actions.

Asset Operations andMaintenance

Enable holistic asset and maintenance management by integrating andautomating all maintenance-related data, processes, and reporting.

Environment, Health, andSafety

Assess and proactively reduce risks to enable safe operations and businesscontinuity.

Energy and EnvironmentalResource Management

Improve operational visibility to reduce energy, environmental footprint, andrelated costs.

Quality Management andCompliance

Provide high-quality products produced in a compliant way from rawmaterial to delivery.

Priorities

SAP Solutions


SAP Solutions

ExecutiveSummary



In today’s dynamic business environment, long-termcustomer relationships are key to sustainable success.The sales force needs to know customers in detail. Theability to cope with the wide variety of productconfigurations is a must.


Digitally plugged in and always on, today’scustomers can obtain information about acompany, products, services, sellers, andcompetitors – all in an instant. This changes therules of engagement with customers.

Prospects and customers can now drive theconversation in disparate directions. To keeppace, organizations need to align their sellingsystem to increasingly empowered customers.Grouping customers according to potential andbehavior is important to leverage the chancesof mobile sales, offer self-services whereapplicable, and focus on the most importantcustomers with direct sales efforts.

Sales executives need a true 360-degree viewof the customer that applies both structured andunstructured data from all relevant sources.They need to foster greater collaboration bothinside and outside the organization. And theyneed the power to access key informationanywhere, anytime.2.5x

Lower customer churnobserved by top 25%companies than bottom 25%organizations in mill productsindustrySource: SAP PerformanceBenchmarking

Priorities


SAP Solutions

SAP Solutions

ExecutiveSummary



BenefitsIdentify pipeline velocity issues up frontImprove decisions with predictive analysisEnhance customer familiarity

Increase customer retentionImprove sales-to-delivery performance

Sustainable Customer RelationshipsAchieve sustainable sales with 360-degree customer insight and fulfillment.See the customer more clearly than ever. Handle personal interactionssimultaneously along all steps in the sales cycle via the Web and other channels.

29%Lower order receipt to shiptime for organizations wherekey order managementmetrics are analyzed acrossdimensions like customer andproduct (MTO model)Source: SAP PerformanceBenchmarking

Market-DrivenSegmentation

Create accurate forecasts, monitor real-time pipeline performance, managebudgets, and allocate territory resources.

Sales Performanceand Enablement

Drive proactive, profitable customer interactions by collaborating acrossdepartments, channels using 360-degree insight

B2B Commerce Deliver a delightful online buying experience and manage all interactions fromone place.

Streamlined Service Provide prompt, targeted customer service to increase their satisfaction whilekeeping costs low.

Order and ContractManagement forConfigurable Products

Manage the order-to-cash process for configurable products from end to end.

Priorities

SAP Solutions


SAP Solutions

ExecutiveSummary



Talent is a true competitive advantage today and criticalwhen aligning business strategy and execution. Best-runorganizations achieve profitable growth by leveragingtheir talent and out-innovating the competition.

Human Resources

For organizational growth and an agile responseto business change, organizations must givepeople the knowledge and technology tofacilitate innovation. They must also move intonew markets, adapting to local practices andtapping the right local talent. In addition, theymust identify and retain new talent acquiredthrough mergers and acquisitions.

Organizations that respond to challengesquickly with the right talent in the right placeswill have a unique advantage in the market-place that can help them outperform thecompetition.

SAP solutions help organizations attract andempower innovative talent and then integrateand leverage the acquired talent. HR depart-ments can find, deploy, and retain talentglobally.

32%Higher revenue per employeefor mill products companieswhere the HR systemsupports a balanced score-card and is integrated toperformance appraisalSource: SAP PerformanceBenchmarking

Priorities

Human Resources

SAP Solutions

SAP Solutions

ExecutiveSummary



BenefitsAlign people to organizational strategiesSupport global expansion into new markets

Improve productivity and engagementGain real-time insight into business needs

Human ResourcesThe new world of work.Enable growth and sustainability by providing choice in HR services. Couple globalcapabilities, integration, and real-time insight with mobile-device support.

8%Higher employee engagementby implementing trainingprograms that develop theworkforce in line withorganizational objectivesSource: SAP PerformanceBenchmarking

Core HumanResources and Payroll

Consolidate HR and payroll processes on a common global platform for betterworkforce data and legal compliance.

Talent Management Improve strategic alignment, increase productivity, and accelerate results byidentifying, developing, motivating, and retaining talent.

Time and AttendanceManagement

Streamline time management processes to enhance resource effectiveness andvisibility into and control over labor costs.

Workforce Planningand Analytics

Identify and analyze talent gaps and streamline workforce planning for efficientand effective management of workforce demand and supply.

Priorities

SAP Solutions

Human Resources

SAP Solutions

ExecutiveSummary



SAP Solutions CFOs implement best practices to strike a balancebetween sound stewardship and value creation, whilewalking the fine line between entrepreneurship andcaution. At the same time, they need to view the rightinformation, whether it’s the big picture, exacting detail,or somewhere in between.

Finance

During one of the most difficult and volatileeconomies of modern times, financialorganizations are struggling to achieveexcellence.

On a daily basis, they encounter persistentchallenges, such as ongoing market instability,ever-changing regulations, and increasingpressure on margins. Plus, the speed offinancial operations is accelerating, requiringaccess to insight on the go – anytime andanywhere.

Finance executives are tasked with cuttingcosts and providing insight into the financialimpact of decisions. To achieve these goals inthis high-pressure environment, financeorganizations must rely on best practices thathelp them achieve excellence and drivebusiness results.

With the right solutions, finance organizationscan excel and become a strategic advisor tothe entire business. They can help ensureregulatory compliance and effective riskmanagement, outperform financial objectives,create sustainable value, and deliver superiorservice at reduced cost.

3xLower finance cost as apercentage of revenue fortop-quartile organizationsversus bottom-quartileorganizationsSource: SAP PerformanceBenchmarking

Priorities

Finance

SAP Solutions

ExecutiveSummary



BenefitsProvide forward-looking insightsDeliver accurate financial data

Enhance efficiency at lower costHelp ensure regulatory compliance

FinanceExcel with best practices that facilitate 360-degree processes.In the face of sustained market volatility, increasingly complex regulatory require-ments, and growing pressure on margins, financial organizations must enable theirstaff to collaborate more efficiently and use business insight more effectively.

76%Higher operating margins,where financial systemsprovide historical and forward-looking views into financialand operational performanceSource: SAP PerformanceBenchmarking

Financial Planningand Analysis

Define and execute organizational strategies, manage financial plans andforecasts, and increase profitability.

Accounting andFinancial Close

Deliver a fast, accurate, compliant close and regulatory disclosures with lesscost and effort.

Treasury and FinancialRisk Management

Achieve greater insight and control over complex processes for managingcash, liquidity, and risk.

Collaborative FinanceOperations

Automate transactional processes to improve efficiency, effectiveness,collaboration, and service at lower costs.

Enterprise Risk andCompliance Management

Protect revenue and optimize financial performance with risk and compliancemanagement.

Priorities

SAP Solutions

ExecutiveSummary


Finance

SAP Solutions


While companies often focus on revenue, procurementsavings can increase profits with far higher impact. Thekey to maximizing procurement’s success in this criticalrole is to deliver consistent quality, savings, and compli-ance over time. That calls for innovative solutions thatboost efficiency and insight.

Procurement

Procurement leaders set a baseline for successby implementing best practices, excelling incategory expertise, and working with keystakeholders on cost-control programs.

While savings is always a priority, newobjectives have emerged as well. Procurementmust manage supplier risk and performance,improve process efficiency, drive innovation,and ensure sustainability practices.

You need solutions that give you the tools tocut costs, as well as add value. These toolsneed to support processes including spend

analysis, sourcing, contract management,operational procurement, services procurementsupplier information, risk and performancemanagement, and invoice management. At thesame time, procurement plays a role in helpingfinance optimize the company’s cash positionthrough discount management programs.

These tools, when connected to and facilitatedby an unparalleled collaborative businessnetwork, drive real-time insight and efficiencythat can only be delivered through the “powerof many.”

60%Improvement in annualaverage savings byleveraging technology forsourcing and procurementprocessesSource: SAP PerformanceBenchmarking

Priorities

Procurement

SAP Solutions

ExecutiveSummary


SAP Solutions


BenefitsOptimize spend under managementIncrease average annual savingsCut FTEs per billion in spend

Drive innovation with suppliersReduce cost and riskAccelerate turnaround

ProcurementDrive sustainable savings while supporting innovation.Ensure best practices within the source-to-pay process in the cloud, whileleveraging the “power of many” through network collaboration to realize greaterefficiency, gain real-time insights, and achieve true procurement excellence.

55%Lower FTE per billion inspending for companiesconducting electronic suppliercollaboration on a networkSource: SAP PerformanceBenchmarking

Strategic Sourcingand SupplierManagement

Find new suppliers through the Ariba Network, and manage these relationshipsthrough supplier management solutions. Identify and act on sourcing opportunities,and create favorable, low-risk supply contracts.

Procure to Paywith BusinessNetworkCollaboration

Realize savings with compliant, user-friendly self-service procurement; servicesprocurement; and plan-driven procurement. Collaborating on the Ariba Networkmakes catalog management, purchase order collaboration, and invoice-relatedtransactions even more efficient.

Business NetworkExtensions forProcure to Pay

Leverage the Ariba Network even further to drive advanced invoice automation andexception management. Manage cash by taking advantage of dynamic discountingopportunities.

Priorities

SAP Solutions

ExecutiveSummary


Procurement

SAP Solutions


Business enterprises should forge strategic businesspartnerships with their IT organizations by aligning goals.And business-oriented IT should maximize efficiency andresponsiveness by running IT like a business.


Research shows that lines of business want toascertain the value of their IT investments,which means that IT organizations no longerdecide alone which IT projects to fund.

The challenge is that IT management is oftenseen as just running the technical landscape.To become more relevant to an enterprise, ITneeds to reposition itself to run like a business.

SAP offers an integrated portfolio of solutionsto do just that. New technologies like mobile, in-memory, and cloud computing generate valueto a business in an unprecedented way.

However, these new technologies also make ITlandscapes more complex, requiring more toolsto manage them. By leveraging SAP solutionsalong with following best practices – CIOs,CEOs, other executives, management, andemployees can tap into and help ensure effi-ciency, continuity, and responsiveness, makingIT more strategic to the business.

Priorities


SAP Solutions

ExecutiveSummary


SAP Solutions


BenefitsBetter align IT to business strategyShorten IT delivery and business cyclesMaximize return on IT

Reduce system upgrade and operation costsLower risk mitigation cost and revenue lossReduce critical business system downtime

Information TechnologyEvaluate and control risk, enable flexibility and scale, control and optimizecosts, and maximize strategic value.Promote business continuity, drive efficiency, and increase IT responsiveness tobusiness objectives – with IT management solutions designed for any size business.

Application LifecycleManagement

Use application lifecycle management best practices, methods, and servicesbased on Information Technology Infrastructure Library (ITIL).

IT InfrastructureManagement Monitor all network assets to integrate infrastructure and application lifecycles.

IT Portfolio andProject Management Manage projects and align the portfolio to drive innovation efficiency.

IT ServiceManagement

Align service-desk operations with service-level agreements (SLAs), resolve SLAincidents fast, and adopt ITIL best practices to meet evolving business goals.

IT Strategy andGovernance

Track IT costs and risks and map risk and compliance activities to businessimpact.

Priorities

SAP Solutions

ExecutiveSummary



SAP Solutions


Technology solutions can make the difference betweensurviving and thriving. And businesses know that theyneed to innovate to drive transformation. Technology andplatform solutions from SAP enable quick adoption ofcutting-edge technology to run the business better andfaster with agility and innovation.


Users expect to run a real-time business withcollective insights from real-time analyticsfor better decision making, prioritization,forecasting and modeling of outcomes, andaccess to applications from the latest mobiledevices. They demand that these capabilitiesseamlessly integrate with their favorite socialplatforms, allowing cross-stakeholdercollaboration.

At the same time, data volumes are explodingwhile the window for capitalizing on opportunitiesis shrinking. Users must be empowered withinformation from real-time applications availablesecurely on any device. And developers need aplatform to innovate faster.

SAP enables the real-time enterprise with aninnovative data platform to power a new classof real-time analytics and applications that givebusinesses a true competitive advantage.Companies can harness the value of Big Data,while improving governance with timely,trusted, and consistent information.

Plus, SAP provides a comprehensive set ofcloud solutions, including line-of-businessapplications as well as social and businessnetwork collaboration. SAP HANA CloudPlatform enables customers to build new appsor extend and customize existing ones withmanaged and subscription-based services.

Priorities


SAP Solutions

ExecutiveSummary


SAP Solutions


BenefitsEnable real-time operationsLower time to value

Turn data into an enterprise assetInnovate customer engagement

Technology and PlatformDrive transformation and help the business thrive with technology.Technology and platform solutions from SAP enable the real-time enterprise byunleashing the power of collective insights, empowering developers to innovate,and unwiring the business.

Big Data Achieve tangible results on every business priority by accelerating how usersacquire, analyze, act on, and apply insights continuously.

Real-Time Enterprise Power a new class of real-time analytics and applications with an innovative dataplatform to give businesses a true competitive advantage.

Real-Time Analytics Unleash collective insight through enterprise business intelligence, agilevisualizations, and advanced analytics on any device and platform.

Enterprise Mobility Deliver a platform for mobile development and security to innovate employeeand consumer apps for any mobile device.

Enterprise InformationManagement

Maximize the value of business data – both structured and unstructured – acrossthe organization.

Application Integration Integrate application delivery to maximize agility across people, processes, andsystems – within and beyond the SAP software landscape.

Cloud Solutions Extend existing on-premise apps and infrastructure to enable new innovativebusiness processes, gain greater insights, and unlock new business value.

Priorities

SAP Solutions

ExecutiveSummary



SAP Solutions


MobileMobile apps from SAP enable all aspects of company operations to run faster and smoother byproviding employees with access to critical information anytime, anywhere and at the same timeallow them to capture data on the spot – eliminating paper-based processes and bringing data in-stantly into the back-end software system where all stakeholders will have immediate access to it.

CloudThe cloud solutions from SAP and its partners provide a new way to deliver extraordinary potentialfor mill customers to run their businesses better and faster.

AnalyticsCompanies on the road to becoming best-run organizations need to know how their current operationsare performing and set appropriate performance targets. The complete set of business analyticstools and valuable business content from SAP deliver the means to become best-run businesses.

Big DataBig Data creates big opportunities. Maximizing asset availability while reducing maintenance costsis one example, but also in areas of finance, commodities, and complex reporting requirements,the SAP HANA platform can enable new business processes.

Accelerating data processing, analysis, and provisioningvia new technologies, such as in-memory computing andmobile apps, and leveraging new cloud-based deploymentoptions provide unprecedented opportunities to theindustry for transforming business models and positionfor sustainable growth.

SAP Innovations

95%Of mill products companiesrecognize technologyinnovations will impactbusiness, while only 40%are ready to realize benefitfrom themSource: SAP PerformanceBenchmarking

Applications

SAP Innovations

The SAP HANA Platform

Mobile

ExecutiveSummary


Analytics

Cloud


Profit-Driven Supply ChainMake better decisions supported by real-time information, including forecasting, stock coverage,and supply projection. Achieve process efficiency in procurement processes. Optimize purchasesin a comprehensive, complete, and real-time working environment allowing complete visibility intoend-to-end procurement activities.

Plant and Asset Operations ExcellenceBenefit from more frequent and precise reorders enabled by faster material-requirements-planningruns in shorter cycles. Readily check production-order readiness for better production sequences.Make up-to-date scheduling of maintenance operations through more frequent planning. Improveefficiency with real-time stock insight and inventory monitoring.

Sustainable Customer RelationshipsCreate additional sales opportunities using context-based recommendations from real-time data.Identify the most profitable customers, using account intelligence analytics, and focus on them.Accelerate the quote management process. Optimize the payment and collections process.

SAP Business Suite software powered by SAP HANAenables mill products companies to get instant, 360-degree insights into customer data to offer them the rightproducts at the right time. These products are efficientlyplanned and produced faster and better with SAPBusiness Suite – at lower cost.

SAP Business Suite powered by SAP HANA

ExecutiveSummary


Applications

SAP Innovations


Mobile

Analytics

Cloud


Maximize Return on AssetsUsing the SAP HANA platform and analytics solutions from SAP, companies can reducemaintenance costs while increasing asset availability. They can also optimize production output bytracking overall equipment effectiveness, from plant level to work centers, to determine whereinefficiencies are and how to alleviate them.

Deliver on Customer ExpectationsBeing able to visualize large amounts of data creates unprecedented visibility into inventory andsupply chain performance and helps companies deliver on customer expectations in quantity,quality, and on-time delivery. They can use SAP HANA to track, trace, and understand theirproducts better at the characteristic level, and they can find and spontaneously offer alternativeproducts.

Mitigate Risk and UncertaintyUsing SAP HANA to combine Big Data from external and internal sources to understand futurecommodity price trends, companies can gain insight into financial transitions to identify and deterfraudulent activities. They also gain confidence in strategic decisions by tracking execution.

Manufacturing companies have Big Data issues. Studiesshow that manufacturing data has increased up to 1,000times in the last 10 years. Manufacturers that can handleBig Data can gain advantages in manufacturing, supplychain, and financial processes.


53%Of organizations report a biggap between the availability ofBig Data and their ability toanalyze it for insightsSource: SAP PerformanceBenchmarking

ExecutiveSummary


Applications

SAP Innovations


Mobile

Analytics

Cloud


Much of the world today operates in a mobile environment, as business processes no longerrequire employee access to physical desktops or landlines. Employees, customers, partners, andthe rest of the business ecosystem have become mobile. Enterprise mobility makes businessprocesses more efficient and more cost-effective for executives, line-of-business managers,business analysts, and individual users.

Mobile apps can make this happen within the mill products ecosystem. In sales, orders can beentered quickly, while product availability, pricing, and delivery dates can be confirmed on the spot.With mobile apps, employees have visibility into the supply chain anytime, anywhere. They canverify that all operations are running smoothly and, if not, react quickly and effectively to anyexceptions or disruptions. In manufacturing, mobile apps enhance operations and provide easieraccess to work order, inventory, shift change, and scheduling data.

Enterprise mobility also allows mill products companies to provide exceptional customer servicewhile lowering delivery costs, thereby increasing customer loyalty and improving profit margins.

Enterprise mobility is a must-have for the mill productsindustry. Executives, sales representatives, shop floor,and maintenance workers are increasingly adoptingmobile technology as they clearly recognize theopportunities to bring more efficiency, simplicity, andspeed to their daily work.

Mobile

22%Fewer days in inventorywhere a higher percentage ofwarehouse and inventorymanagement employees havemobile accessSource: SAP PerformanceBenchmarking

ExecutiveSummary


Applications

SAP Innovations


Mobile

Analytics

Cloud


Maximize Return on Assets and Increase MarginsConstrained by shrinking operational budgets, business managers need to get the most frominvestments in machinery. SAP Asset Analytics software uses data from the SAP Enterprise AssetManagement solution to assess risk and identify bottlenecks and root causes.

Deliver to Customer ExpectationGlobal operations require extensive supply chains that must be managed to meet customerexpectations. The SAP Supply Chain Performance Management analytic application providestransparency and early warning of issues and helps improve customer satisfaction while reducingworking capital.Accurate net margin is difficult to calculate. Best-run businesses have transparency intooperational costs and can improve profitability by simulating what-if scenarios.

Make Decisions Confidently and Execute StrategiesBalance customer expectations with efficient production via sales and operations planning (S&OP).Align sales forecasts with production plans. S&OP allows collaboratively planning, iteration, andsimulation for achieving an optimally aligned strategic plan.

Business value is determined by consistently meetingcustomer demands for quality and on-time delivery.But lacking knowledge about current operationalperformance, how do companies improve? SAP deliverskey analytic and business intelligence tools to supportthe journey to best-run performance.

Analytics

20%Higher availability of real-time,predictive insights when ahigher percentage of strategickey performance indicatorsare tracked using businessintelligence toolsSource: SAP PerformanceBenchmarking

ExecutiveSummary


Applications

SAP Innovations


Mobile

Analytics

Cloud


Profit-Driven Supply ChainSolutions from Quadrem Network and Ariba, an SAP company, bring access to a vast network ofcustomers and suppliers.

The SAP Jam social software platform brings together people, information, and processes for securecollaboration. On-demand solutions enhance supply chain performance and include functionality forsocial networking, strategic sourcing, contract lifecycle management, and supplier management.

Operations ExcellenceThe SAP Product Safety Management OnDemand solution promotes compliance with productregulations and has regulatory content built in.

BizX Suite from SuccessFactors, an SAP company, allows users to set up local mill operationsinstantly; hire and reward employees worldwide; and reduce costs and gain organizationalflexibility while promoting compliance and safety.

Sustainable Customer RelationshipsThe SAP Sales OnDemand mobile app enables users to efficiently manage customer accounts.The sales force can spend more time selling and less time on administrative tasks, with integrationwith the SAP ERP application or external applications.

SAP and its partners provide cloud solutions that openup new possibilities for mill products companies to runtheir businesses better and more economically andgain access to a vast network of global customers andsuppliers, even in remote areas on all continents.

Cloud

85%Believe cloud will have amajor impact on theirorganizations, throughefficiencies, innovation, orcompetitive differentiationSource: SAP PerformanceBenchmarking

ExecutiveSummary


Applications

SAP Innovations


Mobile

Analytics

Cloud


10 of the top 10 paper producers run SAP.

9 of the top 10 copper producers run SAP.

7 of the top 10 aluminum producers run SAP.

7 of the top 10 steel producers in Europe and America run SAP.

Best-Run Customers

ArcelorMittal

Best-Run Customers

Concretos Cruz Azul

Mohawk Carpet

HBIS Tangshan

Vallourec

Woodgrain Millwork

Votorantim Celulose

Why SAP?

ExecutiveSummary



SAP co-innovates with leading mill products companies to identify prioritiesand drive new ideas. Member companies lead co-innovation in areas likemanufacturing, plant maintenance, supply chain planning, and transportationmanagement.

Customer Co-Innovation

Advisory CouncilsCIOs of top mill products companies gather to discuss innovation, technology, and best practiceson managing in a volatile and complex economic environment.

Co-Innovation PartnersConsulting and system-integration partnersValue-added resellers in, for example, supply chain optimization, price and marginmanagement, or enterprise content management

ExecutiveSummary


ArcelorMittal

Best-Run Customers

Concretos Cruz Azul

Mohawk Carpet

HBIS Tangshan

Vallourec

Woodgrain Millwork

Votorantim Celulose

Why SAP?


“The ability to easily access employees’ health indicators and make surethat the occupational health processes are being conducted accordinglyshows us, on a daily basis, the benefits of using SAP EHS Management.”Enilson Miranda Santos, Personnel Administration Manager,ArcelorMittal Brasil

ArcelorMittal Brasil is one of Latin America’s main steel-making companies with a significant presence in the longand flat carbon steel sectors.The company chose the SAP Environment, Health, and SafetyManagement application to replace its disparate collection of legacyhealth and safety solutions. As a result, ArcelorMittal Brasil standardizedits processes and set a benchmark for excellence within the globalArcelorMittal group.

Key BenefitsGreater access to consolidated environment, health, and safety (EHS)data with online analytics and management reportsSingle solution for standardized EHS managementReal-time integration of EHS practices throughout facilities andbusiness areasImproved collaboration with health service providers, clinical labs, andinsurance companies

80%Less time tocomplete accidentinvestigationsand reports

50%Improvedeffectivenessof medicalexam programs

50%Improvedeffectiveness ofEHS action plans

ExecutiveSummary


ArcelorMittal

Best-Run Customers

Concretos Cruz Azul

Mohawk Carpet

HBIS Tangshan

Vallourec

Woodgrain Millwork

Votorantim Celulose

Why SAP?


“The accurate, timely, and high-quality information we get thanks to our SAPimplementation gives us confidence and assurance to move forward indecision making.”Humberto Tapia, IT Manager, Concretos Cruz Azul

Concretos Cruz Azul revolutionizes its cost system forimproved profitability.Concretos Cruz Azul is a 100% Mexican-owned company producing anddistributing premixed concrete. It is now the third-most-importantcompany in Mexico in this sector and has over 40 concrete batchingplants. To gain accurate control of information, Concretos Cruz Azulchose the SAP Profitability and Cost Management application.

Key BenefitsGranulated profitability, thanks to cost system implementation withactivity-based costing methodologyBetter alignment between production and purchaseProduction planning based on costs and operating expenses

33%Fewer staff involvedin cost processes

2%Lowered level ofunprofitable sales

8%Increased efficiencyin production

ExecutiveSummary


ArcelorMittal

Best-Run Customers

Concretos Cruz Azul

Mohawk Carpet

HBIS Tangshan

Vallourec

Woodgrain Millwork

Votorantim Celulose

Why SAP?


“The new plant maintenance solution has helped us improve the condition ofour equipment, which means fewer malfunctions and accidents. Not onlydoes this increase safety for our workers, it saves us money as well.”Wang Lanyu, Executive Deputy General Manager, HBIS Tangshan Iron andSteel Group Co. Ltd.

The iron and steel industry is facing tough times in today’smarketplace.In order to meet quality demands, management needs tools to bettermonitor equipment, materials, and budgets. HBIS Tangshan Iron andSteel deployed the SAP Enterprise Asset Management solution with itsexisting SAP ERP application, resulting in fewer spare parts and lowermaintenance and overhaul costs.

Key BenefitsAutomated, standardized, and transparent equipment managementBetter management of spare parts resulting in lower inventory levelsMore efficient budget control for easier monitoring and fasterdistribution

425 millionYuan saved in maintenancecosts

59%Reduction in overhaul costswithin 6 months

21%Fewer spare parts consumedper ton of steel

ExecutiveSummary


ArcelorMittal

Best-Run Customers

Concretos Cruz Azul

Mohawk Carpet

HBIS Tangshan

Vallourec

Woodgrain Millwork

Votorantim Celulose

Why SAP?


“SAP CRM, delivered by Liquid Analytics, has dramatically improved theMohawk customer experience, adding great value to our business. It helpsour reps focus on the most important items for each individual customer,enabling a more personalized conversation.”Brian Nooney, Director of Sales Solutions, Mohawk Industries Inc.

There are so many things to consider when pickingout flooring or carpet. Apart from material, color, andstyle, there are questions about cushion, twist, glaze,and underlying slab.To target customers for specific pricing and promotions,Mohawk developed a mobile app to run with the SAP CustomerRelationship Management (SAP CRM) application. The salesteam now has a complete customer view, plus analytics andsales tools, online or offline, right on their iPads.

Key BenefitsMore personalized relationship between representatives andcustomersGreater productivity, thanks to complete and timely access tocustomer information on an iPad, both online and offlineStronger sales and a better customer experience by allowingsales teams to create more tailored customer interactionsand sales plans

99%Fewer quoting errors

US$500,000Revenue increase, thanks togreater quote efficiency

30%Less time spent by sales reps onadministrative work each week

ExecutiveSummary


ArcelorMittal

Best-Run Customers

Concretos Cruz Azul

Mohawk Carpet

HBIS Tangshan

Vallourec

Woodgrain Millwork

Votorantim Celulose

Why SAP?


“The speed of implementation, ease of use, and cost savings associatedwith SuccessFactors software have made all the difference to our HRexperiences and ability to perform as a global company.”Philippe Ferrie, Worldwide Employee Relations Coordinator and HRISDirector, Vallourec

Vallourec is a world leader in premium tubular products for oiland gas, energy production, and other industrial applications.The company has tube production down to a fine science.Vallourec needed common, efficient HR processes across its globalenterprise. With cloud-based SuccessFactors software as the basis,the firm created standard, integrated HR cycles that greatly boostedproductivity. Implementation was much faster and less expensive thanwith traditional software, and easy access to data in the SAP ERPapplication was a key enabler.

Key BenefitsIncreased HR staff productivityImproved visibility into talent pools for succession planningIncreased employee loyalty and retention

99.7%Engagementin formal HRprocesses,up from 50%

30%Less time neededfor performancereviews

5x–10xLess expensiveimplementation

ExecutiveSummary


ArcelorMittal

Best-Run Customers

Concretos Cruz Azul

Mohawk Carpet

HBIS Tangshan

Vallourec

Woodgrain Millwork

Votorantim Celulose

Why SAP?


“At VCP, we have evolved from a risk-correction culture to a risk-mitigationculture. Now, all our business areas are fully aware of the potential impact ofunmanaged risk.”Celso Yao, Risk Manager, Votorantim Celulose e Papel S.A.

Votorantim Celulose e Papel S.A. (VCP) – one of Brazil’slargest pulp and paper producers – is known for its leadingbusiness practices. This award-winning company managesthe entire process, from growing the pulpwood to distributingthe finished goods to more than 50 countries worldwide.Manual risk management controls were making it difficult for thecompany to maintain the level of access security required by Sarbanes-Oxley (SOX) regulations. Reliance on lengthy spreadsheets, for example,limited visibility. To institute a new access governance model, companyexecutives chose the SAP Access Control application.

Key BenefitsCertified SOX complianceCompany-wide awareness of the importance of effective riskmanagementAbility to identify access vulnerabilities and exception casesAutomated, rules-based tools used across corporation, reducing costs

91%Reduction innumber of accessconflicts

74%Faster audit cycles

ExecutiveSummary


ArcelorMittal

Best-Run Customers

Concretos Cruz Azul

Mohawk Carpet

HBIS Tangshan

Vallourec

Woodgrain Millwork

Votorantim Celulose

Why SAP?


“Based on firsthand experience with SAP ERP HCM, I can say without doubtthat we made an excellent decision in choosing SAP as our solution providerand BestXperts as our implementation partner.”Connie Moylan, Chief Information Officer, Woodgrain Millwork Inc.

With a significant number of employees located in 16 U.S.manufacturing and distribution locations that service nearly800 big-box retail stores, Woodgrain Millwork Inc. is one ofthe world’s largest millwork companies.

To reduce cost and improve efficiency, Woodgrain standardized allemployees on a biweekly payroll-processing cycle with the SAPERP Human Capital Management (SAP ERP HCM) solution.

Key BenefitsImplemented the solution on time and 15.6% under budgetAvoided the expense of upgrading the legacy payroll applicationIncreased payroll volume while reducing payroll-processing cycle time

67%Faster payroll-processing cycle time

>90%Reduction in annualpayroll-processingcost

30%Lower total costof ownership over5 years

ExecutiveSummary


ArcelorMittal

Best-Run Customers

Concretos Cruz Azul

Mohawk Carpet

HBIS Tangshan

Vallourec

Woodgrain Millwork

Votorantim Celulose

Why SAP?


Leveraging the latest technology innovations, SAP for Mill Products solutionsenable sustainable growth by safely optimizing asset performance, helping ensurereliable and profitable order fulfillment, and limiting risk.

Tightly Integrated Business SolutionsSAP offers the most comprehensive portfolio of solutions for the mill products industry, enablingcompanies to focus their key business processes and activities on assets and operations, whilemonitoring risk and compliance.

Leveraging Key Breakthrough InnovationsThe SAP solution portfolio is based on the industry’s most innovative technology foundation,including the SAP HANA platform, mobile solutions, analytics, and cloud solutions. They enablebusiness process optimization and efficiency at the lowest possible cost.

40 Years of Delivering ValueThe world’s leading mill products companies, across every major industry segment worldwide, relyon SAP solutions to drive sustainable growth, profitability, and value to their customers.

Why SAP?

ExecutiveSummary


ArcelorMittal

Best-Run Customers

Concretos Cruz Azul

Mohawk Carpet

HBIS Tangshan

Vallourec

Woodgrain Millwork

Votorantim Celulose

Why SAP?


Benchmark Your PerformancePosition your organization for dominance in this new economy with the business performancebenchmarking program from SAP – available free to SAP customers and select prospects.The SAP benchmarking program has helped more than 3,000 organizations assess theirstrengths, uncover areas for improvement, and identify best practices and IT strategies thatgenerate clear, tangible value – not someday, but today.

Go Live in WeeksHere’s the fastest way to run your business better: our rapid-deployment solutions. In onepackage, you get everything you need to be up and running quickly – including preconfiguredsoftware and implementation services – in just weeks. With a defined scope and predictablecosts, there are no surprises.

Join Your Community of PracticesEvery day, SAP Community Network (SCN) changes the way that thousands of SAP users work.It lets members help one another solve problems, learn, and invent new ways to get thingsdone – faster. Find out how to connect with people, content, and resources.

Find Out More About How Your Organization CanBecome Best-Run

Visit valuemanagement.sap.com >>

Visit sap.com/solutions/rds >>

Visit scn.sap.com >>

ExecutiveSummary


Executive Overview


Mill Products

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ExecutiveSummary


CMP 29018 (14/01)



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