Case Study Wieland: IT strategy and SAP scenarios

Case Study: SAP-based IT Strategy

The project

Long-term planning

Wieland Metals Singapore (Pte) Ltd is part of the Wieland Group, the world’s leading manufacturer of semi-finished products in copper and copper alloys.

Wieland Metals Singapore (WMS) was running an ERP system that no longer met its requirements. The strong commercial success in Asia and the close integration of the supply chain with the headquarters in Germany made it necessary to review the future direction.

Date:

2015

Category:

Scenario analysis, business analysis, IT strategy

Tags:

Strategic planning, collaboration, IT strategy, budget, TCO

Client:

Wieland Metals Singapore

The challenge

A few years earlier, the parent company of WMS had decided to move to SAP, so the subsidiary faced the question of whether to connect to the existing system or to run its own instance, which would be less expensive.

As this could not be decided in isolation, the mandate also included developing a suitable IT strategy for a separately operated core system.

Finally, the two possible scenarios were to be compared in a full-cost calculation over 3 and 10 years.

The solution

At the start of the project, intensive discussions were held with local management to examine the possible scenarios and the expected project and cost framework.

WMS commissioned Reppel to carry out a comprehensive scenario analysis based on a cost and decision matrix that was to be developed as part of the project. The framework was set: either develop an IT strategy that fits a central SAP instance, or a strategy that leaves Asia-Pacific largely independent as a region while ensuring the integrity of the supply chain.

Based on the strategic goals of further aggressive growth in Asia combined with a robust and scalable supply chain, the project team got to work. In a series of workshops and management interviews, strategically relevant cornerstones for the future set-up of WMS were identified. The results of these discussions then fed into the development of the corresponding strategy.

We developed a detailed decision matrix covering all aspects of a modern enterprise architecture and sought to limit the possible risks of the approach. A total cost of ownership (TCO) calculation was prepared for the respective planning and payback periods.

At the end of this phase, the client had all the information needed for a well-founded budget discussion with the board.

Business success

In this discussion, the two solution scenarios were considered and weighed against each other. The board decided in favour of the global solution, but at the same time agreed to reduce the expected charges to the region for running the global SAP system.

Contrary to the initial discussion about running the Asian subsidiaries as lean as possible on the IT side, headquarters recognised that the team in Singapore was up to date and had the skills needed to run independent IT around a central SAP system. This led to highly collaborative work in the following project and beyond, which produced high-quality implementations while keeping pace with the high market speed in Asia.