digital transformation strategy and sap implementing projects · fixed pricing conditions (discount...

18
Digital Transformation Strategy and SAP implementing projects 11 September 2019 Artyom Lobzenev Irina Tivileva

Upload: others

Post on 05-Jan-2020

5 views

Category:

Documents


0 download

TRANSCRIPT

Page 1: Digital Transformation Strategy and SAP implementing projects · Fixed pricing conditions (discount from the price / price formula) Market readiness (suppliers are ready to create

Digital Transformation Strategy and SAP

implementing projects

11 September 2019

Artyom LobzenevIrina Tivileva

Page 2: Digital Transformation Strategy and SAP implementing projects · Fixed pricing conditions (discount from the price / price formula) Market readiness (suppliers are ready to create

1

EVRAZ in figures

EVRAZ is a global steel and mining company, the leading producer of infrastructure steel products with low-cost production along the value chain.

Page 3: Digital Transformation Strategy and SAP implementing projects · Fixed pricing conditions (discount from the price / price formula) Market readiness (suppliers are ready to create

2

EVRAZ Information Technology

ASM TP (Scada)

MES (Manufacturing Execution System)

ERP (Enterprise Resources Planning)

Digital technology (expert systems, predictive analytics, etc.)

BI (Evraz Reporting System), Production Reporting

Production planning

(PP)

Maintenance and Repair

(PM)

Material management

(MM)

Quality Management

(QM)

Sales Management

(SD)

Procurement system(P2P)

Advanced Planning and Optimization

(APO)

Info

rmat

ion

Se

curi

ty,

Infr

astr

uct

ure

Business customer«Big» IT

Page 4: Digital Transformation Strategy and SAP implementing projects · Fixed pricing conditions (discount from the price / price formula) Market readiness (suppliers are ready to create

3

Why do we need Digital Transformation

Increasing Productivity and Energy Efficiency

Improving term accuracy of production orders

Reducing the risk of emergency events, unplanned downtime

Reducing risk of production shutdown

Increasing HSE maturity

Reducing in stocks and scrap

Reducing data preparation time for analysis and decision making

Improving accounting transparency

Page 5: Digital Transformation Strategy and SAP implementing projects · Fixed pricing conditions (discount from the price / price formula) Market readiness (suppliers are ready to create

4

Digital Transformation Strategy Approach

Seminar with the management of the Company to develop of basic principles and directions of

development IT and DT

2

3

4

5

Vision for IT and DT development

Target level of automation of basic IT

services

Priority areas of IT and DT

development

1

Project roadmaps based on the

principle of Digital ready

Form and implementation of new approaches to the realization of IT

and DT projects

Implementation of IT and DT strategies

Page 6: Digital Transformation Strategy and SAP implementing projects · Fixed pricing conditions (discount from the price / price formula) Market readiness (suppliers are ready to create

5

Key Trends in Digital Transformation

Basic IT services: automation of business processes,information security, quality IT services, ensuring business continuity etc.

Expert systems

Production accounting

Production dispatch room

Predictive analytics

Digital Maintenance

End-to-end quality management

Production planning

EDI

Autonomous equipment

Mobile Solutions

Video analytics

Page 7: Digital Transformation Strategy and SAP implementing projects · Fixed pricing conditions (discount from the price / price formula) Market readiness (suppliers are ready to create

6

How to Implement Digital Transformation Projects Effectively

PROJECT METHODOLOGY• Using Agile with Rapid Prototyping Approaches• Greater involvement of the business customer (Product Owners)• The calculation of the economic efficiency of the project

DT EXPERTISE CENTER• Monitoring DT best practices• “Pulling” and implementation of DT initiatives• Culture changing

RESOURCE PROVIDING• Creating of an additional development center (outside Moscow)• Strengthening Project Managers

Page 8: Digital Transformation Strategy and SAP implementing projects · Fixed pricing conditions (discount from the price / price formula) Market readiness (suppliers are ready to create

7

The landscape of the main information systems

Core SAP ERPSAP HCM

MES

ASM TP

Solution 1

Solution 2

Solution 3

Solution 4

AS IS

Wonderware In-house solutions

SCADA SensorsHistorian Controllers

TO BE

Azure ML

Hybrid integration platform (HIP)

Core SAP ERP

MES

ASM TP

Deeper consolidation of MES systems

UnificationThe increase in the number of sensors and controllers

SAP HCM

Azure ML Ariba Salesforce HSE SAP BI EDIMobile

PlatformBPM Ariba Salesforce SAP BIHSE EDI

Mobile Solution

Others

1С 1С

Others

Page 9: Digital Transformation Strategy and SAP implementing projects · Fixed pricing conditions (discount from the price / price formula) Market readiness (suppliers are ready to create

8

Our SAP projects (selected)

Plant Maintenance Monitoring and reporting system

Maintenance labor dispatching on SAP MRS

Operational planning system for Chief Mechanic department (own spare parts production) on SAP ERP and SAP APO PP/DS

Punchout procurement catalogs on SAP Ariba Catalog

Page 10: Digital Transformation Strategy and SAP implementing projects · Fixed pricing conditions (discount from the price / price formula) Market readiness (suppliers are ready to create

9

Plant Maintenance Monitoring and reporting system

Project goals

Improving the efficiency of maintenance business processes Development of analytical reports on maintenance and

monitoring KPI

Development of a tree of goals and tools for monitoring the results of the maintenance business process. Evaluation of these indicators for maintenance efficiency

Development of a KPI analysis concept for various levels of performers and managers

Development of a visualization tool based on BW for the analysis of maintenance results and management decisions

Project objectives

SAP ERP (ТОРО)

SAP BWBI

reporting

SAP HCMDowntime accounting

system

Page 11: Digital Transformation Strategy and SAP implementing projects · Fixed pricing conditions (discount from the price / price formula) Market readiness (suppliers are ready to create

10

Maintenance labor dispatching on SAP MRS

Project goals

Improving the efficiency of repair personnel Improving the convenience of operational planning of

repair activities Providing planners with reliable information on loading

repair personnel

Setting up the detailed planning function (by resources) taking into account existing maintenance tasks and inspections from SAP ERP Plant Maintenance

Setting up integrated planning (by task) Adjustment of capacity balancing functionality for

workplaces of workshop personnel, repair shop personnel and contractors

Reporting forms directly from the planning panel

Project objectives

SAP ERP (PM) SAP MRS SAP HCM

Results / Effects

Reducing the labor costs of the planner when balancing the working capacity for workshop repair personnel by 2 times or an average of 25 hours per month

An increase the share of work performed by our own staff by 467 man-hours in 6 months without an increase in the number of repair personnel

Reduced production downtime for repairs from 32 to 30 hours A 10-fold reduction in the share of activities that were not completed as part of

repairs due to improper planning of deadlines and workload of performers (or 1% of the increase in absolute terms)

Page 12: Digital Transformation Strategy and SAP implementing projects · Fixed pricing conditions (discount from the price / price formula) Market readiness (suppliers are ready to create

11

Operational planning system for Chief Mechanic department. SAP APO PP/DS (1)

Project goals

Ensuring maximum, balanced loading of personnel and equipment groups

Operational re-planning of the production program, taking into account the changed priorities for fulfilling needs, with an assessment of the impact of unplanned orders

Tracking lead times

Reliable primary accounting in the SAP system

Production Rate Management

Formation of a plan for loading the enterprise’s production capacity in the context of shifts, ensuring the implementation of the IGM production program

Separation of planning and production functions

Wide availability of relevant information on the production of spare parts

Early detection of equipment overload and underload problems

Project objectivesСхема ежесуточного задания по планированию производства УГМ

SA

P E

RP

SA

P A

PO

Z-Программы

корректировки

мощностей рабочих

мест, модификации

ОЗМ и РР-заказов

Стандартные

транзакции генерации

и активации

интеграционных

моделей

Стандартные

транзакции передачи

данных удаления

СПД и присвоения

ОЗМ к области ППМ

Расфиксация

операций на

горизонте от -90 до

-2 дней

Разделение

операций

(невыполненные

части)

Перенос

невыполненных

частей операций на

+3 день

Фиксация ресурсов

в горизонте от -1 до

+2 дней

Расфиксация

операций на

горизонте от -2 до

+6 месяцев

Многоуровневое

ППМ по всем

продуктам

Календарное

графикование

(общий алгоритм)

Календарное

графикование

участков литья

ФЛЦ

Календарное

графикование

участков резки

ФЛЦ

Расфиксация

операций на

горизонте от -2 до

+6 месяцев

Расфиксация всех

ресурсов

Преобразование

плановых заказов

в

производственные* FLC: shaped foundryMERS-3: cutting and metalworking shop

Page 13: Digital Transformation Strategy and SAP implementing projects · Fixed pricing conditions (discount from the price / price formula) Market readiness (suppliers are ready to create

12

Operational planning system for Chief Mechanic department. SAP APO PP/DS (2)

Target status

ProductionMERS-3

Combining TCD and Warehouse

2 days

Production FLC

Warehouse FLC

WarehouseMERS-3

ProductionMERS-3

Before system implementation SAP APO PP/DS

Term

s ar

e n

ot

regu

late

d d

uri

ng

the

pro

du

ctio

n p

erio

d

X days

X days

X days

Results / Effects

4-Day reduction IGM Production cycle

Save the level of stocks (materials, production assets) by 6 times

Increase in the proportion of orders executed on time

Optimization of the number of IGM personnel involved in the planning, provision and execution of the production program

Improving the productivity of areas of in-house manufacturing of spare parts with the replacement of third-party contractors and procurement

Opportunity:

shorten the supply chain “Procurement - Shipment of suitable products”

Decision:

Delivery of blanks to the “Just in time” production

Consolidation of liability for procurement warehouses in FLC on MERS-3

Expanding the functionality of TCD controllers with responsibilities for the receipt / accounting / storage / consumption of Inventories

Target status

Production FLC

Warehouse FLC

ProductionMERS-3

2 days

2 days

Before system implementation SAP APO PP/DS

TCD

ProductionMERS-3

Warehouse of finished goods

2 days

2 days

* FLC: shaped foundryMERS-3: cutting and metalworking shop

Page 14: Digital Transformation Strategy and SAP implementing projects · Fixed pricing conditions (discount from the price / price formula) Market readiness (suppliers are ready to create

13

Punchout procurement catalogs on SAP Ariba Catalog (1)

Implementation of SAP Ariba Catalog at EVRAZ enterprises

Project goals Project objectives

Defining target purchasing patterns using catalogs

Definition of criteria for “cataloging” nomenclatures

Ariba Catalog and SAP ERP Integration

Synchronization with the internal directory of goods and materials

Involving and training suppliers

Increasing applicants' satisfaction by reducing the time needed to meet needs, increasing transparency and accuracy of the procurement process

Reducing company operating costs in the execution of the procurement process

Minimizing the risk of violation of the terms of the contract due to automatic control of compliance with the conditions of the purchase order and the terms of the contract

Self-Service Purchasing

Reducing the time from the formation of needs to creating a purchase order by reducing the number of competitive procedures, using of data uploaded to suppliers catalogs and improving the management process of NSI

Reduced labor costs for processing needs by automatically assigning a source of supply to create a purchase order

Convenient service for applicants of goods and materials (automatic search, product description, delivery time, image, analogues and related products, etc.)

Reduced labor costs for downloading catalogs and updating supplier prices by self-loading / updating catalogs by suppliers

Results / Effects

Page 15: Digital Transformation Strategy and SAP implementing projects · Fixed pricing conditions (discount from the price / price formula) Market readiness (suppliers are ready to create

14

About the project “Implementation of SAP Ariba Catalog at EVRAZ enterprises”(2)

Organizational scope of the project 2018 2019 2020 +

Raspadskaya Coal Company LLC

(Coal Division, the number of users is 300 people)Implementation Pilot operation Industrial exploitation

JSC Kachkanar Mining and Processing Plant

(Ural Division, number of users 100 people)Implementation Pilot operation Industrial exploitation

JSC West Siberian Metallurgical Plant / Evrazruda

(Siberia Division, the number of users is 800 people)Implementation Pilot operation

JSC Nizhny Tagil Metallurgical Plant

(Ural Division, number of users 1000 people)Implementation Pilot operation

Attracting suppliersPilot suppliers

20 Russian companiesAttracting an additional ~ 80 suppliers

Catalog types:

Punch Out dynamic catalogs - integration of the supplier’s online store with the customer’s accounting system via SAP Ariba

Internal Excel catalogs - the supplier creates Excel catalog and loads it to buyer account in Ariba Network

Object: stocked materials

Selection criteria for catalog items:

Low-cost goods and materials

Wide range of SKUs supplied by the supplier

The presence of a long-term contract with the supplier (1 year +)

Fixed pricing conditions (discount from the price / price formula)

Market readiness (suppliers are ready to create catalogs according to the Ariba pattern)

Внедрение SAP Ariba Catalog на предприятия ЕВРАЗаImplementation of SAP Ariba Catalog at EVRAZ enterprises

Page 16: Digital Transformation Strategy and SAP implementing projects · Fixed pricing conditions (discount from the price / price formula) Market readiness (suppliers are ready to create

15

Potential for catalog coverage

Внедрение SAP Ariba Catalog на предприятия ЕВРАЗа

Nomenclatures for translation into Ariba catalogs:

• Tools (construction, metal-processing, mining, etc.)• Electrotechnical products• Instrumentation• Plumbing products• Rubber-technical products • Parts for cars and special equipment• Spare parts for pumps• Spare parts for mining equipment

• Stationery (punch out)• Household goods and small household appliances• Spare parts for railway equipment• IT machinery and equipment• Bearings (General Industrial)• Construction Materials (except for reinforced

concrete products, met. designs and bulk materials)• Hardware• Industrial oils

2018-2019 yy.

In development

Goal: reduce labor costs for the purchase of a large number of low-cost goods and materials

7%

Share of catalog items in the total amount of purchases

34%

Share of catalog itemsin the general assortment of goods and

materials purchased

Implementation of SAP Ariba Catalog at EVRAZ enterprises

Page 17: Digital Transformation Strategy and SAP implementing projects · Fixed pricing conditions (discount from the price / price formula) Market readiness (suppliers are ready to create

16

Process flow with Ariba catalogs

Внедрение SAP Ariba Catalog на предприятия ЕВРАЗа

Agrees the directory loaded by the supplier

Provides synchronization of Ariba directories with the

internal inventory directory of goods and materials

Publishes an approved directory

Forms a shopping cart and sends the order to ERP

Agrees /rejects need

Pro

vid

erP

urc

has

erC

lien

tA

gree

Processes the order and delivers the goods

Loads a directory

to the cloud Ariba

SAP Ariba Catalog SAP ERP

Generates a purchase order

Procurement procedure

ППМ (очистка потребности от

запасов)

PRS (purification of requirements from stocks)

Automatic control of the

workshop budget

Implementation of SAP Ariba Catalog at EVRAZ enterprises

Page 18: Digital Transformation Strategy and SAP implementing projects · Fixed pricing conditions (discount from the price / price formula) Market readiness (suppliers are ready to create

17

Vendor’s catalog visualization in SAP Ariba Catalog

Внедрение SAP Ariba Catalog на предприятия ЕВРАЗаImplementation of SAP Ariba Catalog at EVRAZ enterprises