Only 25% of ERP projects generate the projected ROI. Key reasons for this include bad data or under-governance of once-harmonized data. If you are planning a SAP system consolidation, or upgrade (or have just completed one), understanding the value of harmonized material masters might just be that winning stroke.
It’s no wonder that best practice experts always recommend standardizing and harmonizing material master data during an SAP/ERP upgrade. Using enriched, rationalized, and harmonized data to fuel the ERP has measurable impact on ROI from an SAP implementation. Watch this educational presentation to learn how you can use ‘always-harmonized’ material data as a partner to ensure the best possible results from your SAP upgrade or consolidation.
2. Today Speakers
Jose Bobrek–Central Master Data Management, ASR-Group
Jose is a Team Leader within the Central Master Data Management team at ASR-Group, responsible for MRO and Vendor master data. ASR-Group is the largest vertically integrated sugar cane refiner in the world with brands such as Domino Sugar, C&H, Florida Crystals, Tate & LyleSugars and Redpath. ASR-Group utilized the services of Verdantis back in 2002 to harmonize their legacy data. Since then Jose’s team has maintained the integrity of the master data with a home-grown system called CMDM which in 2011 was replaced with Verdantis Integrity -a more robust tool to govern large amounts of materials. During their last 3 acquisitions in Europe and North America, Verdantis categorized & standardized 40,000 materials and translated in 3 languages 3,000 materials that were loaded in to Integrity to become part of the 250K global repository of harmonized materials used by the ASR- Group.
Arthur Raguette -Executive Vice President, Verdantis Inc.
Arthur is very passionate about the application of innovative technologies to solve real-world business problems with a strong emphasis on large enterprise solutions. He has more than a decade of experience of working with Software for Master Data Management and Data Governance for multiple domains and across industries. Arthur’s prior technology passions included high performance B2B middleware and hybridized SaaS applications for HR, Employee and Education related domains.
Copyright 2014 Verdantis Inc.
3. •Why ERP consolidations fail ? How can M&As leverage the larger procurement organization? Arthur Raguette –EVP, Verdantis Inc.
•The secret sauce, and why should Business careArthur Raguette –EVP, Verdantis Inc.
•Getting it Clean and Keeping it CleanArthur Raguette –EVP, Verdantis Inc.
•How ASR-Group safeguarded their SAP ERP investment Jose Bobrek –MRO Team Lead, ASR-Group
•Your data holds locked value –See for yourselves with a free Proof of ValueArthur Raguette –EVP, Verdantis Inc.
Agenda
4. •ERP Systems Are Indispensable to Business Operations in Large Organizations
•Master Data Has a Material Impact on the Financial and Operational Health of an Organization
•Master Data Quality affects the Accuracy, Efficiency, and Reliability of business processes
•Consistent Data Management keeps Enterprise Applications effective
•Master Data Standardization and Rationalization Is a foundation for increasing the ROI of an existing ERP Investment
Copyright 2014 Verdantis Inc.
Background
5. The items it makes
The items it buys
The employees who work there
The customers who buy
The suppliers it buys from
Master Data Quality Issues Ripple Across the Enterprise
Copyright 2014 Verdantis Inc.
Common Master Data Domains
The Role of Master Data in the Enterprise
6. Customer Master
CRM Teams
Vendor Master
Procurement/Accounts Payable
Item Master
No clear Owners
A disorganized approach toward Maintaining Master Data Is more common than you may think…
Copyright 2014 Verdantis Inc.
A Challenge of Master Data in the Enterprise
7. Business Stakeholders
Enterprise Applications
Information Technology
Has specific functionality
Rules in its own fashion
Handles the business context of data
Individual understanding of data attributes
Global Data
Synchronization
Processes related to
Customers
Materials
Products/Services
Vendors
Information is inconsistent across the organization
Sharing and synchronizing information across enterprise applications further creates complexities
Conflicting data across business factions
Lack of stakeholder ownership
Delayed request for information
Lost ROI from ERP investment
Heterogeneity
Copyright 2014 Verdantis Inc.
Multi-domain MDM Challenges
8. •Various master record formats
•Various systems of record
•Incongruent naming standards or no naming standard
•Lack of a standardized classification convention
•Incomplete fields and missing data elements
The Effect of Bad Master Data on Business Initiatives Is Profound
•Merger and Acquisition Activities
•ERP System Consolidation
•Enterprise Spend Management
•Sourcing Strategies and the make-v/s-buy process
•Inventory Visibility
•Decreased Plant and Equipment Availability
•Part Reuse in Design
•Decreased Employee Productivity
Copyright 2014 Verdantis Inc.
Current Issues in Master Data Success: The Root Cause is Data Quality
9. ETL Solutions
(Extract, Transform, Load)
These solutions are too generic in functionality to deal with the complexities of item master records. ETL solutions do not perform classification and attribute enrichment. Moreover, there is considerable effort and expense in setting up these solutions for repeated use.
Asset Management Solutions
Asset management solutions typically target only a subset of item master data, namely MRO (maintenance, repair, and operations) items. This is
not sufficient for ERP consolidation or for comprehensive spend analysis. In addition, there is significant manual effort involved.
Commerce Catalog Solutions
Commerce catalog solutions tend to focus only on the items sold, rather than those procured. These solutions are less experienced in tapping the various internal and external sources of item data and fail in the subject-matter expert department. Furthermore, they do not automate the attribute enrichment, automating instead only the workflow.
Manual Content Factories
Manual content factories, or manual approaches in general, were common before the advent of artificial intelligence tools for master data rationalization. The manual approach cannot scale nor can it meet the throughput demands of large projects.
Copyright 2014 Verdantis Inc.
Incomplete Approaches towards Master Data Rationalization
10. •How repeatable is the process?
•Can the system learn?
•What is the throughput of the system?
•How strong are the algorithms used for the automated processing?
•Can the process be integrated into daily operations?
Limited Scope of Organizational Data
Narrow Focus
Lack of Scalability
High manual intervention
Multiparty data manipulation
Key Issues with Concurrent
MDM Approaches
Copyright 2014 Verdantis Inc.
Proper Master Data Management requires a consistent automated process!
11. •Why ERP consolidations fail ? How can M&As leverage the larger procurement organization? Arthur Raguette –EVP, Verdantis Inc.
•The secret sauce, and why should Business careArthur Raguette –EVP, Verdantis Inc.
•Getting it Clean and Keeping it CleanArthur Raguette –EVP, Verdantis Inc.
•How ASR-Group safeguarded their SAP ERP investment Jose Bobrek –MRO Team Lead, ASR-Group
•Your data holds locked value –See for yourselves with a free Proof of ValueArthur Raguette –EVP, Verdantis Inc.
Agenda
12. Master Data Management (MDM) of the Key Masters has to be part of the ERP blueprint
ERP initiatives, the importance of data migration & the emergence of Master Data Management (MDM)
During Data Migration, multiple masters are migrated
•Small Masters -Chart of Accounts Master, Currency Master, etc
•Key Masters -Material, Vendor, Customer, etc
Handling of the key masters during migrations is the key to unlocking the ROI from an ERP investment
•Material Master ROI
•Supplier Master ROI
•Customer Master ROI
Handling Key Masters need a specialist
•IT services provider or ERP implementation partners cannot do it
•Data migration of Key masters needs strong domain expertise
•Specialized cleaning tools and knowledge repositories are needed
83% of data migration projects fall/overrun
•Half exceed timescales by three-quarters
•Budgets are exceeded by two-thirds
•A third of these fail entirely
Copyright 2014 Verdantis Inc.
Integrating Master Data Rationalization Into ERP Consolidation or Upgrade Planning
13. Demonstrable ROI in
•Greater and quicker ROI realization form ERP Investments
•Increased Leverage of the existing systems
•Increased Contract Compliance
•Spend Leverage through supplier consolidation
•Global Inventory optimization
•Reduction of Inventory Carrying costs
•Increased Plant Uptime
•Increased Worker productivity
•Reduced Mean Time to Delivery of Products
Extraction and Aggregation
Cleansing
Classification
Attribute Extraction and Enrichment
Final Duplicate Record Identification
Building the right business Case for Master Data Rationalization
Copyright 2014 Verdantis Inc.
Material Master Data Rationalization
14. •Clean, Reliable Master Data Enables Successful Enterprise Initiatives
•Master Data Rationalization Is Required to Ensure Master Data Quality
•Build Master Data Rationalization Into ERP Consolidation Planning
•Master Data Rationalization Is a Key Component to Achieve Data Quality Maturity
Copyright 2014 Verdantis Inc.
The bottom line
15. •Why ERP consolidations fail ? How can M&As leverage the larger procurement organization? Arthur Raguette –EVP, Verdantis Inc.
•The secret sauce, and why should Business careArthur Raguette –EVP, Verdantis Inc.
•Getting it Clean and Keeping it CleanArthur Raguette –EVP, Verdantis Inc.
•How ASR-Group safeguarded their SAP ERP investment Jose Bobrek –MRO Team Lead, ASR-Group
•Your data holds locked value –See for yourselves with a free Proof of ValueArthur Raguette –EVP, Verdantis Inc.
Agenda
17. •Task and Batch Management Improvesworkflow and Increasesthroughput
–A graphical process builder is used to create a project or batch process/data flow
•Individual Processes can be ordered per project or per batch to set the automation linkages and tie in the human team members
•Having multiple batches per project allows optimization of team members while managing interim deliverables across a global team
Copyright 2014 Verdantis Inc.
Project and Batch Management
18. •EmbedAdvancesin categorization, classification, and clustering
–Next Generation of Artificial Intelligence based classification combined with post processing closed-loop feedback
Copyright 2014 Verdantis Inc.
Automation of Categorization
19. •Automatedcontext-aware attribute, characteristic, and value identification and extraction
–Domain and Taxonomy specific modules for materials and industrial products
•Extendable intelligence for Industry and Geography coverage
•Extensible modules configurable by customers or by Verdantis
Copyright 2014 Verdantis Inc.
Automated Attribute Extraction
21. SaaS Based Approach is great for Organizations who
–Are facing ERP/MRP/EAM and Transformation Projects
–Have the internal resources to do the work
–Also those
•with Non-Standard Domains with specific domain requirements, or
•Target continuous M&A or Joint Ventures
–Want to leverage a Force Multiplier of x 10 through clustering, fuzzy logic matching, and Learn By Example
Automated Standardization, Normalization and Element Extraction lets one person run Thousands of records per day!
Copyright 2014 Verdantis Inc.
Automation = Internal Team x 10
22. GlobalOil and Gas producer with revenues over $100 Billion
•Our Software forms the backbone of the Customer’s Material Master Data System -which combines into a common SaaS platform:
•Self Service Catalogue Master Cleansing and Loading capabilities for the Global Supplier Ecosystem.
•Indirect Goods Master management
•MRO Material Master management
•Engineered Part Master management
•The historical data alignment process covered more than 6 different types of data and nearly a million SKUs
Copyright 2014 Verdantis Inc.
More than Just Consolidations –Procurement Transformations
23. •Why ERP consolidations fail ? How can M&As leverage the larger procurement organization? Arthur Raguette –EVP, Verdantis Inc.
•The secret sauce, and why should Business careArthur Raguette –EVP, Verdantis Inc.
•Getting it Clean and Keeping it CleanArthur Raguette –EVP, Verdantis Inc.
•How ASR-Group safeguarded their SAP ERP investment Jose Bobrek –MRO Team Lead, ASR-Group
•Your data holds locked value –See for yourselves with a free Proof of ValueArthur Raguette –EVP, Verdantis Inc.
Agenda
24. Growth by acquisition created a need to migrate new plants onto a common ERP and Item and Supplier Master Catalogue. Integrity managing on-boarding and governance of both.
•Harmony modelling for 2 ERP systems
•250K Items, 30 Plants
•300 Named Users
•2 languages plus English
•1000 plus new materials monthly
Fortune 500 –Worlds Largest Sugar producer, American Sugar has FCC and Domino’s as household brands
Jose Bobrek
Team Leader (MRO & Vendors)
Florida Crystals Corporation
ASR-Group
American Sugar Refining Group –Team Lead, Central MDM
25. Item Master
•250 K Items: Stock and Non Stock, as well as Direct Materials in English plus 2 Languages Spanish and Portuguese,
•300 requesters with 1000 requests monthly across 30 Plants
•6countries in the Americas and Europe and 5 time Zones
•2 SAP systems with real-time integration
•UNSPSC taxonomy and custom Spec Sheets
•Direct as well as indirect materials are processed through integrity. this includes:
•MRO (indirect materials)
•Industrial Supplies (indirect materials)
•Chemicals
•Empty Packaging Materials (Direct Materials –form part of our finished good materials)
•Ingredients (Direct Materials –form part of our finished good materials)
Complex material master data scenario
26. •Project Initiative:
•Replaced home grown portal CMDM
•Centralized Master Data Management
•Evaluated SAP MDM and other MDM options
•Now live for over 3 years on Verdantis Integrity
•Selected Verdantis for domain expertise, performance, automation and value
Leveraging technology to meet business goals
27. •Verdantis supported ASR-Group through 3 acquisitions
•Acquisitions in London and Portugal in March 2012 (Tate and Lyle Sugars)
•Brought onboard 40,000 material items into our system
•Verdantis classified and translated into 2 additional languages – Portuguese and Spanish-prior loading to Verdantis Integrity and SAP ECC 6.0
•Acquisition in Canada in November 2013
•Brought onboard 3,000 materials into our system
•Used Harmonize to standardize materials, prior loading to Verdantis Integrity and SAP ECC 6.0
Driving SAP Implementation success with Integrity
28. Integrity is a data governance solution that supports cross functional collaboration, approval routing, and real-time master data governance and stewardship.
Copyright 2014 Verdantis Inc.
Now live for over 3 years on Verdantis Integrity
29. Integrity: Driving in data control and driving out duplicates
•There are two ways to a user can initiate creating a Material
–By Entering The manufacturer and part Number
–by describing the material
30. •User will enter a category description and Integrity will suggest classes
Integrity: Driving in data control and driving out duplicates
31. •After selecting a classification Integrity will show the material attributes or characteristics that need to be
Integrity: Driving in data control and driving out duplicates
32. •After populating the attribute values and selecting the “Check Duplicates” button Integrity will suggest similar materials under the same classification and it will highlight in green similar attributes
Integrity: Driving in data control and driving out duplicates
33. •Integrity will ask the user to select a plant
Integrity: Driving in data control and driving out duplicates
34. •In this screen Integrity displays the Basic Data view with a standardized description
Integrity: Driving in data control and driving out duplicates
35. •Improved timely material creation across the enterprise serving over 300 users (mostly plant maintenance)
•Eliminated the creation of duplicate materials
•Ensures maintaining of MDM standards globally
•Promotes the reduction of inventory of spare parts by identifying duplicate items and equivalent parts. Also by sharing some common expensive items.
•Supports all locations:
–Ability to change the UI in 3 languages.
–Creates materials with descriptions in 3 languages
•Supports SAP implementations through master data uploads
Benefits of Implementing Integrity at ASR-GROUP
36. •Why ERP consolidations fail ? How can M&As leverage the larger procurement organization? Arthur Raguette –EVP, Verdantis Inc.
•The secret sauce, and why should Business careArthur Raguette –EVP, Verdantis Inc.
•Getting it Clean and Keeping it CleanArthur Raguette –EVP, Verdantis Inc.
•How ASR-Group safeguarded their SAP ERP investment Jose Bobrek –MRO Team Lead, ASR-Group
•Your data holds locked value –See for yourselves with a free Proof of ValueArthur Raguette –EVP, Verdantis Inc.
Agenda
37. •Determine POV Objectives and Scope
•# of Item Masters and Source Systems
•Select Data Sample
•Select Taxonomy & Attribute Templates
•Verdantis Processes Data
•Fully Classify POV data set
•Fully Cleanse a subset of data
•Non Source Enrich a subset of data
•Flag duplicates for processed Items
•On-site Review of Deliverables
•Data Analysis and Output
•Draft Budget Proposal
•Business Case Recommendations
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Learn:
•Quality of Data
•Compatibility to automated approach
•Potential duplicate levels
•Estimated budget
•Recommended Scope & Resources
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Master Data Management Solutions