SAP Plastics Overview

SAP Solutions for the Plastics Industry Enabling Business Transformation SAP IBU Chemicals September 2011

Agenda

Plastics Industry and Specific Requirements SAP Background SAP Value Proposition for the Plastics Industry Partner Landscape Customer Success Stories

© 2011 SAP AG. All rights reserved.

2

Plastics Industry

 The plastics industry is one of the largest manufacturing industries in the United States, accounting for more than US $374 billion in annual shipments  The industry directly employs more than 1.1 million people  Plastics play an indispensable role in a wide variety of markets, including packaging, building & construction, transportation, consumer & institutional products, furniture and furnishings, electrical & electronic components, adhesives, medical & health care, industrial machinery, automotive, and others

Source: Plastics Industry Trade Association © 2011 SAP AG. All rights reserved.

3

Plastics Industry Landscape RESINS Acetal- Acrylics ABS – Alkyds Alloys/Blends Cellulosics Diallyl Phthalates Engineering Plastics Epoxies Fluoropolymers Liquid Crystals Melamine Nitrile Resins Nylon Phenolics Polyamide-Imide Polycarbonate Polyethylene Polyimides Polypropylene Polystyrene Polyurethanes PVC Silicones TPO/TPE/TPU

ADDITIVES Accelerators Antioxidants Antistats Blowing agents Colorants Conductive EMI shielding Fillers Flame retardants Inhibitors Lubricants Plasticizers Stabilizers © 2011 SAP AG. All rights reserved.

MACHINERY SUPPLIERS Extruders Injection Molding Machines Blow molding Compression Presses Transfer Presses Thermoforming Machines Molds / Dies Auxiliary Equipment Liquid Dispensing Systems Impregnators Plotters Test & Measurements Components Process Control Equipment

DISTRIBUTORS

COMPOUNDERS

WHOLESALE TRADE

RECYCLING

DECORATING & ASSEMBLY PROCESSORS Custom

Captive

Injection Molding Extrusion Blow Molding Blown / Cast Film Coaters Rotational Molding Pultrusion Thermoforming Calandering Compression Molding Reaction Molding Transfer Molding

FINAL GOODS Agricultural Appliances Transportation – Auto Packaging Building and Construction Computers / Electronics / Electrical Geotechnical Structures Telecommunication Medical / Health care Adhesives / Coatings Furniture Industrial machinery Fast Foods Consumer & Institutional Products Recreation / Toys Rope & Cordage Textile / Synthetic Fibers

4

Plastics Industry Requirements  The industry serves major original equipment manufacturers (OEM) as well as a direct market for finished items  OEM customers belong to many verticals: automotive, home appliances, electronics, communication, and lawn and garden. The go-to-market approach of many of these segments is so aggressive that the component supplier is expected to meet very short response times and high quality targets (from design of mold to delivery)  Mold manufacturing and first-article approvals must be planned along with order delivery management, requiring implementation of project management methodologies and tools

 Due to persistent price and margin pressure – particularly for smaller organizations – strong efforts are required to maximize yield and throughput and to minimize off-spec product and variability  Tight integration between plant-floor and business systems is required

 Net working capital must be reduced through improved management of regrind © 2011 SAP AG. All rights reserved.

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Plastics Industry Requirements - Continued  Production waste management – strong requirements to schedule regrind, tool changes, and downtime  Product profitability – accurate cost calculations at the SKU level are necessary and are to consider material content and labor  Tight integration between CAD/CAM systems and business application systems (PlantStar and Matec systems)  With multiple choices in mold management, product costing and quotation preparation requires a flexible approach that is controllable at the production stage

 Typically, manufacturing locations are distributed – requiring close control of production and delivery (including kits) with the ultimate goal of ensuring on-time delivery with minimum inventory levels and costs of logistics  With limited budgets the industry’s expectations of the business solution is high in terms of time to implement and pricing © 2011 SAP AG. All rights reserved.

6

State of Plastics Industry Manufacturing Methods  Job Shop  Repetitive

Management Control  Product Pricing & Low Margins  Material Usage  Delivery Management

Organizational Pressures  Cost Control  Delivery Response Time  Flexible Production Systems

IT challenges  Diverse systems  Lack of industry specific functionalities in current software  Limited budget and resource constraints © 2011 SAP AG. All rights reserved.

7

What Keeps You Awake At Night? Shortened response time? - design of mold to delivery Material management issues?  production planning based on family molds  production waste  recycling delivery management/kit supplies Product costing and quotation - controllable at production stage? Control mechanism - synchronizing kit parts production/delivery across multiple plants? Integration issues - Machine monitoring systems & business application(s)?


8

Software Requirements of the Plastics Industry


•

Provide a fast time to value

•

Affordable

•

Lower operating costs

•

Can be managed with a limited IT staff

•

Is easy to use and maintain

•

Leverage industry standards and best practices

•

Deliver market-leading functionality

9

Agenda



10

SAP Today

53,800+ SAP employees worldwide

120 countries

25 industries

37 languages

75 country offices

1,200+ services partners worldwide


11

SAP's Performance in the Last 10 Years 51,544 47,578

CAGR total revenues*: 5.5% CAGR operating income*: 12.7%

44,023 39,355

11,565

35,873 28,410

24,480

28,797 7,413

7,341

29,610

10,671

10,242

32,205

9,393 8,509

7,025

7,514

6,265

2,578

2,732

2,840

2,640

2,337

803

2000

1,312

2001

1,626

2002

Revenue* © 2011 SAP AG. All rights reserved.

1,724

2003

2,018

2004

2005

Employees

2006

2007

2008

Operating income*

2009 *US GAAP 12

SAP Customers Within Global 500 70 60

SAP customer Global 500 comp

40 30

CP / Retail

49% 100%

100%

Financial Services

73%

Util

Telco

Ins

Bank

Life Sc.

Mining

Chem

HT

Mill

Process

86%

56%

100%

Discrete

72%

Serv.P

100%

88%

Wholesale

Retail

0

CP

47%

77%

59%

89%

Media

68%

88%

ME&C

93%

Auto

10

94%

O&G

20

A&D

# companies

50

Services

n.b. the Public Sector is not covered by the Global 500 Source: Fortune Magazine, Global 500, SAP Analysis © 2011 SAP AG. All rights reserved.

13

SAP can be quickly Implemented Predictable Implementation Times Over 65% of the SAP solutions for midsize companies were implemented within 13 weeks

40%

40

35%

30

25%

20 10 0 10-11 weeks © 2011 SAP AG. All rights reserved.

12-13 weeks

> 14 weeks 14

SAP Market Position Solution

SAP Position

Source

SAP ERP

#1, Market leader

Gartner, META

SAP CRM

#1, Market leader

Gartner, AMR

SAP FI

#1, Market leader

IDC

SAP HR

#1, Market leader

Forrester, AMR

SAP PLM

#1, Market leader

IDC

SAP SRM

#1, Market leader

AMR

SAP SCM

#1, Market leader

Gartner, AMR

SAP Portal

Suite Leader

META

Order Fulfillment

#1, Market leader

Forrester

SAP SEM

#1, Market leader

Gartner

SAP BI

Suite leader

META

Workforce Mgmt

Suite leader, #2 overall

Forrester


15

SAP Chemical Customer Base Growth: 2001 – 2010 2,959

Despite market consolidation 1,881 new customers added

366 280

260

 Customer base expanding in both weak and strong markets

221 243 189 156

1,078

 New customer growth consistent and sustained

93 73

 Significant and wellknown brands added each year  Strong chemical base drives ongoing development 2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

1,881 new customers added in last 9 years – with increasing velocity as the industry returns to growth © 2011 SAP AG. All rights reserved.

16

Strong SAP Presence in your Value Chain Customers and partners find synergies as they interact across the value chain

Coatings & Resins

Plastics


CMs/EMS/O Consumer Healthcare Electronics DM

Consumer Products

17

Typical Contract Manufacturing Key Challenges Today Limited Visibility, Control in Mfg and Global Supply Chain

Non-Optimal Customer Management



Inaccurate, insufficient and/or Fragmented Supply chain information



Manual / excel based planning, scheduling, tracking OEE and S&OP (ie Customer Supply)



Manual, slow, error prone ECN management and BOM synchronization



Infrequent, manual manufacturing data updates impacting data latency and accuracy



Inefficient quality management, enforcement and validation

Disconnected Processes and Systems Limiting Growth 

Lack of integration, automation and communication between fragmented systems & entities



Limited data sync between functional areas & geographies



Raw Materials



Limited view of global customer interactions



Manual / disconnected quotes management



Long Quote to Order to Cash process (ie. mold prep lead time)



Manual RMA process



Insufficient customer service

Supply Chain Ops

Production

Limited standardization: business process and systems

HQ IT



Prolific use of excel



Manual , disconnected AR payment processes driving high DSO and inaccuracies

Sales, Marketing & Service

Inadequate Visibility to Risk and Liability Eng, Legal, Finance, HR Difficult to measure margin



Increasing compliance requirements: CFR Part 11, Reach, WEEE, Global Trade, etc



Limited visibility to end of life liability especially in long term



Disconnected PLM process impacting NPDI, TTM and innovation cycle time



Difficult to manage global governance and risk



High number of Quality Returns (RMA)


Difficulty w/ Financial Management & Control

 

Long close times tying fragmented data to GL



Difficult to manage multiple legal and reporting entities



Limited ability to forecast cash flow, compare actuals to budget, and conduct global money management



Data availability, latency and quality impacting ability to conduct analysis, timely consolidation and decision support 18

Contract Manufacturers Objectives Uniquely Enabled by SAP Global Lean Operations, Supply Chain Visibility & Control 

Real -time availability of supply chain information



Automated quality management, enforcement and validation 



Automated manufacturing data



Integrated ECN management and BOM synchronization Exception based and systematized planning, scheduling, tracking, OEE and S&

Integrated, End-to-End Business Process Integrated, End-to-End Business Process and Data Visibility and Data Visibility

Ease of Customer Service 

3600 view of global customer interactions

Single data repository for all business processes and geographies



Integrated Inquiry-Quote-Order-Cash process



Real-time, synchronized data availability



Systematized RMA process



Standardized business process based on best practices



Automated, faster, more accurate business transactions



Risk Mitigation and Liability Control

Supply  Chain Ops



Supply Chain Unified WW compliance approach: CFR Part 11, Reach, Ops WEEE, Global Trade, IFRS, Sustainability, etc



EOL inventory and financial planning



Collaborative PLM speeds up NPDI and TTM



Out of the box best practices for global governance and risk



Improved visibility to accurate data and advanced warning to potential challenges (ie quality)

Financial Management & Control


IT

HQ

Improved speed, flexibility and customer service

Sales & Marketing

Eng, Legal, Finance, HR



Automated, real-time cost and margin visibility



Financial data automatically tied to GL in realtime



Data availability reduces latency improving and data quality & analysis



Best practices and integrated processes for managing multiple legal and reporting entities



Best practices and tools for financial planning, consolidation, forecast and global money management 19

SAP Overall R&D Investment Impact into Solutions Overall R&D Investment $ Millions 1,900

2000

1,750

1800 1600

1,450

1400

1,150

1200 1000

857

910

951

363

200

0

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

“Importantly, the stronger margin does not appear to becoming at the expense of future growth – R&D headcount is up Q/Q and Y/Y and S&M headcount is down marginally quarter-on-quarter and up year-on-year – both indicating that capacity and product investment are not being curtailed.” – SalomonSmithBarney on SAP




Global Trade Management & Services



Manufacturing Intelligence & Dashboards



Configurable Product Planning & Execution



Compliance; EH&S, Environmental Compliance, REACH, GTS, RoHS/WEEE, Carbon Impact



Outsource Manufacturing & Multi-Tiered Inventory Solution for the Process Industry



Contract Manufacturing



Sustainability Performance Management



Enterprise Asset Management



Multi-Level ATP, CTP



RFID & Logistics Tracking



Hijunka Scheduling – Lean Sequencing



MES Integration



Service Parts Planning & Management



Quality Management



Mix mode of batch & discrete business processes



Batch Management & Automatic Determination



Regulatory compliance (SOX, Global Trade)

1,025

572

600

SAP Best Practices business scenarios

1,250

705

800

400

866



20

SAP Business All-in-One: Comprehensive, Flexible, and Integrated Business Software  Best fit for companies looking for the most integrated and comprehensive industry solution to power their business end-to-end  What It Offers  Comprehensive functionality – Broad and deep business functionality that leverages industry-specific best practices  Flexibility – Tailored to match your business needs  Scalability – Solutions that grow and adapt as your business needs change  Reliability – Best-in-class, precision-engineered software leveraging SAP’s 35+ years of industry leadership in business applications


21

The SAP Business All-in-One Solution Single, comprehensive, integrated end-to-end industry solution SAP Business All-in-One

Fast ROI

SAP ERP 

SAP’s next-generation ERP solution



Powered by SAP NetWeaver technology platform



Designed for all industries



Fully integrated within the SAP Business Suite

SAP Business All-in-One Solution

+ SAP Best Practices 

Best-in-class industry expertise in SAP ERP



Predefined end-to-end processes



Industry-specific documentation



Preconfigured system

Implementation Reduced Timeline

Lower Risk

+ Services 

Deep industry knowledge



Focus on value creation and risk reduction



Delivery excellence


Fast, proven, and reliable 22

Best Practices, Pre-configuration & Customer Benchmarks Influencing Factors

Industry Best Practices  Packages that provide preconfigured business processes, documentation and project accelerators to streamline customer implementations

Industry Benchmarks  SAP captures KPI’s from thousands of companies (SAP CUSTOMERS AND NON-CUSTOMERS).

 Configurable and extensible

 SAP survey’s companies enabling processes and practices.

 Reusable documentation and configuration which can be adapted to specific needs

 Quantifiable proof of which practices are in fact the “best”.

 Preconfigured, ready-to-use business scenarios based on SAP’s deep industry experience with > 40,000 implementations

 We have over 3,200 benchmarking surveys in our inventory, making it one of the largest in the world.

 Tools, content, and methodology to reduce costs compared to traditional approaches

 This is an important part of SAP’s intellectual property.

 Have a working, fully-documented prototype in only a few days right out of the box

This is more than making simple enhancements to an ERP system. Only SAP has the scientific, quantifiable indications of best practices from our world class benchmarking database. How important is it for your firm to adopt industry specific solutions that streamline your business processes by assimilating best practices?


23

Agenda



24

Typical Challenges in the Plastics Industry Ecosystem The Need for Continuous Growth in Revenues and Productivity Drives Dynamics in the Plastics Industry

Differentiation and Innovation

Price and Margin Pressure

Market 

Markets rebound, strong growth  New opportunities in eastern Europe, Latin America, and Asia  Globalization of trade, production, and competition  Enhanced customer service with proximity to customers

Foundation for Increased Revenues



High price pressure and customer power (conglomerates)  High raw-material prices due to strong demand for crude and oil  High volatility in crude and raw material prices  Redundant manufacturing practices

Productivity and Efficiency Foundation for Increased Operating Profits

Optimized Processes

Product Innovation 

Shortened product life cycles; demand volatility  Collaborative development with customers in virtual teams  Price pressure product manufacturing  Complicated engineering change process



Higher productivity in a corporation wide production processes  Optimization and integration of global business processes  Optimized production planning and production operations  Optimized supply chain planning and execution

Regulatory Requirements

Competition  

Many small and midsize companies  Emerging markets and competition in Asia


Increased regulatory burden (SOX and FDA, CH Part 21)  Global product, transportation, and import/export safety requirements

25

What Does This Mean for Your Business? Typical CEO questions  How do I ensure successful program launches on time and on budget?  How do I facilitate collaborative engineering change management between suppliers & customers?  How do I improve information sharing with customers seamlessly?  How do I increase supply chain visibility?

 How do I optimize product, customer and service portfolio profitability?  How do I determine optimal and visible inventory targets across the supply chain?  How do I drive successful planning and replenishment in a dynamic and ongoing manner?  How do I manage operating costs? © 2011 SAP AG. All rights reserved.

26

Integrated Software Solution Provide Best Practices for Managing These Challenges Differentiation and Innovation Foundation for Increased Revenues

Price Pressure

Market 

More transparency enhances decision support  Globally harmonized market approach  Global coordination of supply and demand  Manage end-of-life products better

Productivity and Efficiency



Global purchasing Eliminating redundancy in processes and systems  Cost transparency as a basis for consolidation  Reduction of TCO through consolidation of IT systems 

Foundation for Increased Operating Profits

Optimized Processes

Product Innovation 

Reduced development times and avoidance of duplication efforts from knowledge management; visibility and distribution across the entire company



Corporate Compliance and Visibility

Competition 







360-degree view of the customer Availability of specific information across regions, market segments, products, and competitors  Leverage multi-modal crossgeographic manufacturing

Logistics collaboration and automation  Optimized production planning, execution, and asset management  Lean and agile processes  Streamlined engineering change process for higher agility

Fast close Cost transparency at all levels of decision making  Adaptive response to structural or operational changes

The dynamics in the business environment must be strongly aligned with the IT strategy and represent a major challenge to the adaptability and sustainability of IT architectures and solutions © 2011 SAP AG. All rights reserved.

27

SAP Experience in the Plastics Industry Hundreds of plastics industry companies run SAP software across all plastics industry subsegments

Sample customers  Ace Plastics

 Entegris

 Amcor

 Injection molders

 AZ Electronic Materials

 ICI Polyurethanes Group

 Blow molders

 Basell

 Master Molds

 Thermoformers

 Bespak

 Nampac

 Extruders

 Colder Products

 Nilkamal Plastics

 Compounders  Plastic materials and resins

 DSM Engineered Plastics  Plastal  Plastek Group  Deerfield Plastics  Plastipak  Resolution Performance Prod

 Rexam Plastics  SeaquistPerfect  Sheffield Plastics  Thermotech  Toray Plastics  Veka


28

Injection Molding Companies Serving Many Market Segments Injection molding companies serving many market segments

Sample customers  Ace Plastics

 Master Molds

 Packaging

 AKsys

 Mennekes

 Pharmaceutical

 Amcor

 Nilkamal Plastics

 Medical devices

 Behr

 Plastal

 Health Care

 Colder Products

 Plastek Group

 Consumer products

 Geiger Technik

 Plastic Omnium

 Food and beverage

 Grammer

 Plastipak

 Aerospace and defense

 Karl Popp

 Pressotechnik

 Automotive

 Manner Plastics

 Rexam Plastics

 High tech

 SeaquistPerfect

 Industrial

 Spaeh Group

 Personal care

 Thermotech  Valeo  Yapp Plastic Parts


29

SAP’s Unique Approach to Industry-Specific, Low-Cost, and Low-Risk Implementation SAP ERP

+ SAP Best Practices for Chemicals / EHSM Preconfigured Industry Templates

+ Partner Packaged Services Implementation Services

= SAP Business All-in-One Solutions for Paints, Coatings and Inks SAP implementation with defined scope and price Available from SAP and qualified partners


30

SAP’s Solution for the Plastics Industry Product Development

Human Resources

Sales, Marketing and Service



  

   

 

Continuous Product and Service Innovation Integrated Product Development REACH Compliance and Product Stewardship

Drive Efficient HR Operations Talent Management Core HR & Payroll Business Network Transformation

Procurement

 



Extended Procurement Spend Performance Management and Related Services Sourcing and Contract Management

Supply Chain

Sustainability



Supply Chain Product Development

Manufacturing

Sales

Procurement Human Resources

Finance

       

Financial Value Chain Treasury and Financial Risk Management Commodity Risk Management Financial Shared-Services Framework Sustainability Strategy Manage Risk and Compliance for Finance Manage Financial Performance Accelerated Financial Close


Price and Margin Management E-Commerce Sales Force Management Customer Service Contact Center

  

Collaborative Demand and Supply Planning Logistics and Fulfillment Management Manufacturing Network Planning and Execution Inventory Optimization

Finance Information Technology

Manufacturing

 Information Technology

    

Insight and Analytics Enterprise Information Management IT Security and Compliance Business Integration IT Operational and Service Excellence

    

Designing, Building and Commissioning of Assets Manufacturing Visibility and Performance Optimized Asset Operations and Maintenance Efficient Manufacturing Operations Operational Risk Management Energy and Environmental Resource Management

31

Best Practices Content at help.sap.com

http://help.sap.com/bp/industry/chemicals/ © 2011 SAP AG. All rights reserved.

32

SAP Best Practices for the Plastics Industry – Scenario Exmples Product Development  

Manufacturing

Business Network Transformation

Internal Order R&D Planning (177) Internal Order R&D - Actual (185)

Sustainability



Supply Chain



 

Product Development

Manufacturing

Sales



Procurement



Human Resources



Finance



Procurement



Information Technology           

Quotation for Procurement (128) Consumable Purchasing (129) Procurement without QM (130) Procurement Contract (133) Return to Vendor (136) Procurement and Consumption of Consigned Inventory (139) Procurement of Batch-Managed Stock Materials (901) Procurement of Warehouse-Managed Stock Materials (902) Procurement of Pipeline Materials (903) Procurement of External Services (904) Quality Management in Procurement (905)

    

Supply Chain

 

         




Lean Warehouse Management (124) Stock Transfer with Delivery (134) Stock Transfer without Delivery (135) Physical Inventory / Inventory Count and Adjustment (137) SAP ERP Reports for Logistics (222) Supply and Demand Planning (900) Tank Trailer Filling (919) Outbound Logistics (923) Totes Handling (927) Vendor Managed Inventory (928)

      

Stock Handling: Scrap and Blocked Stock (131) Time Recording (211) Overhaul Management (886) Refurbishment Management (887) Work Clearance Management (888) Bulk Manufacturing (without PI Sheet) (907) Bulk Manufacturing (with PI Sheet and SAP ODA Integration) (908) Make-to-Stock (Process Industry) with Warehouse Management (909) Make to Order (Process Industry) (910) Multiple Product Campaign Run including MQC (911) Active Ingredient Processing (912) Blending (913) Repackaging (914) Relabeling (915) Storage Tank Management (916) Subcontracting (External) (918) Operational Maintenance (929) Preventive Maintenance (930) Investment Management in Plant Maintenance (932) Engineering Change Management (934) Subcontracting (Internal) (973) Repetitive Manufacturing with QM (992) Process Order with Co-Product and QM (993) Work-in-Process (WIP) Batch (996)

33

Scenario 900

Event

Supply & Demand Planning Does S003 contain sales data?

Yes

Create Demo Data Using Upload File

Transfer planning data to demand management

Strategic Planner

Production Planner

IT Administrator (Professional User)

No

Schedule Copy Mgmt S003 > S999

Check sales history in planning type

Schedule background job for statistic forecast

Generate Planning Hierarchy master data

Set Status of Background Job for Statistical Forecast

Change local plan in flexible planning

Calculate proportional factors using actual data

Reset Generation Time Stamp

Schedule Planning Job for Fixing Local Plan

Schedule copy mgmt S999 – S076

Schedule Planning Job for Fixing Global Plan and Creation of Consolidated Sales Data

Create global plan

Create rough cut plan

Disaggregate planning data

Find capacity overloads

Analyze Overall capacity loads

MRP run

Capacity leveling

Long term planning

Capacity leveling

Transfer Demands to Material Requirements Planning

Set up Purchasing info data from long term planning

Long term planning Material analysis

MRP = Material Requirements Planning


34

Scenario 902 MRP Generated Create Purchase Requisition

Purchasing Manager

Event

Procurement of Warehouse Managed Stock Materials

Approve Purchase Order

Create Purchase Requisition

Purchase Order (PO)

Warehouse Clerk

Buyer

Yes

PO Approval required?

Display the Bin Stock of the Material

Confirm Transfer Order

Print Purchase Order

Send Purchase Order (to Vendor)

Create Transfer Order

Stock GR/IR PPV

Receive Goods in Restricted Stock

Usage Decision on inspection lot

Process Quality certificate

Yes

Quality Specialist Accounts Payable

No

Accept

GR/IR PPV Small differences Use tax payable Vendor

Invoice Receipt by Line Item

MRP = Material Requirements Planning, RFQ = Request for Quotation, GR/IR = Goods Receipt/Invoice Receipt, PPV = Purchase Price Variance


35

Scenario 909

Event

Make-to-Stock (Process Industry) with Warehouse Management

Period End Closing “General” Plant (181)

MRP Run?

No

Production Planner

Confirm Process Order

Create inspection lot manually

Ware-house Clerk

Quality Specialist

Convert Bulk Planned Order and Release Process Order

Shop Floor Specialist

Yes


Quality Notifications – Defect Recording

Create Bulk Process Order for CH-3200

Results Recording Worklist

Record Usage Decision

Post-Process Control for GranuSAP, Blue

Create Transfer Order

Confirm Transfer Order

Display Storage Bin

Putaway of Produced Material

36

Scenario 918 Create Purchase Order

Approval of Purchase Order (Optional)

Stock Transfer for Subcontracto r without Delivery

Accounts Payable Account-ant

Quality Specialist

Ware-house Clerk

Purchaser Chemicals

Purchaser Manager

Purchaser

Subcontracting (External)

Stock Transfer for Subcontracto r with Delivery

Processing Deliveries and Picking

Goods Receipt for Subcontract Order (without WM)


Results Recording

Invoice Verification

MRP = Material Requirements Planning, PO = Purchase Order, GR/IR = Goods Receipt/Invoice Receipt, PPV = Purchase Price Variance


37

Scenario 918 Strategic Planner

Material Requirement s Planning at Plant Level

Initial Stock Posting

Evaluation of the Stock/Requir ement List

Pick Confirmation (Optional)

Generate Transfer Order (Optional)

Confirm Transfer Order (Optional)

Post Goods Issue to Subcontracto r Transfer Stock

Receiving a Subcontract Purchase Order – Goods Receipt

Posting Intime Consumption of Components

Production Planner

Release Process Order

Create PO for External Processing with Material Number

Engine ering Specialist

Quality Specialist

Accounts Payable

Create Process Order

Shop floor Specialist

Stock Overview (Optional)

Purchaser

Warehouse Clerk

Create Planned Independent Requirement

Produ c-tion Planner

Subcontracting (External)


Process Order Confirmation (Purchasing Manager) Release Purchase Order (Optional)

(Purchaser Chemicals) Create Outbound Delivery Request (Accountant) Enter Invoice

(Manager) Release Blocked Invoices Results Recording


Derivation Monitor (Optional)

38

Scenario 929

Event

Maintenance Notification

Chemicals Maintenance Specialist

Operational Maintenance

Entering a Malfunction Report

Create Purchase Order from Purchase Requisition in Maintenance Order for Non-Stock Material

Entering a Maintenance Order

Create Purchase Order from Purchase Requisition in Maintenance Order for External Services

Service Employee

Purchasing Manager

Confirming a Maintenance Order


Goods Receipt to Purchase Order

Invoice Receipt to Purchase Order

Show Costs on Maintenance Order

Goods Issue to Maintenance Order

Complete the tasks in the Notification

Closing the Maintenance Order – Business View

Settling the Maintenance Order

Technically Completing a Maintenance Order

Approval of Purchase Orders

Maintain a Service Entry Sheet

Approve the Service Entry Sheet

39

Scenario 973

Planned Independent Requirements

Execution of MRP Run

Availability Check of Non Provided Materials

Convert Planned Order into Process Order

Release Process Order

Sales Order Processing

Process Order Confirmation

Shipping Delivery

Billing Administrator

Shop Floor Specialist

Posting Materials Provided

Ware-house Clerk

Ware-house Clerk

Sales Administrator

Production Planner

Subcontracting (Internal)

Goods Issue for Delivery

Billing

AR= Accounts Receivable, COGS = Cost of Goods Sold, MRP = Material Requirement Planning


40

SAP Best Practices Adds Significant Value Global, external, and cross-industry university study1) Conclusion: SAP Best Practices are a significant value-add  22% shorter project duration

 Project costs reduced by 20% - lower TCO

 71% lower project risk

 Higher net present value (NPV)

 28% increased satisfaction among project stakeholders

 Shorter break-even period

Customer Quotes2)

“

“There’s no way we could have designed and implemented our system in five months, and kept our ongoing IT costs so low, without SAP Best Practices.” Michael Thompson, Systems Manager, FutureFuel Chemical Company

“The fact that SAP understands the chemical industry was a huge differentiator. We leveraged SAP Best Practices for Chemicals as the template to drive us forward and accelerate our implementation.” Blake Barthelmess, Chief Information Officer, REC Silicon Inc. Sources: 1) Study, University of Ludwigshafen, Germany © 2011 SAP AG. All rights reserved.

2) SAP Business Transformation Studies 41

Customers and Analysts Confirm... Only SAP Offers Industry-Specific Functionality and Best Practices “We are taking this step (implementing SAP MII) to make sure that transactions are always available at our plants. SAP ensures that all transactions would be stored and later forwarded to the corporate system. We implemented 17 sites in one year and have speeded up our production set-ups” John Niemzyk, Vice President and CIO , Rexam “SAP’s major asset resides in the native integration of functionalities of PLM in the total solution, which eliminates the interfacing procedures. In short, SAP made it possible for us to carry out a project with only one tool able to manage both the operational and the decisional information.”

Jean-Louis Gautier, Supply Chain Manager, Thales ED Briefing: SMB Companies May Be Able to Leapfrog with SAP “Small and medium businesses have an opportunity to leapfrog their larger competitors by adopting the SAP Business All-in-One solution, deploying at 50% lower cost and in a fraction of the time of previous SAP R/3 implementations.” Colin Masson, AMR Research Briefing: SAP’s New Packaged Solution for the Chemical Industry (updated) “Our final assessment is that SAP has done a good job with this . . . chemical packaged solution. It addresses the vast majority of issues (scenarios) a company may face . . . . SAP is the first of the major ERP suppliers to provide such a solution for this market . . . . SAP should find a welcome reception.” © 2011 SAP AG. All rights reserved.

42

SAP Already Addressing Customer Needs Solutions for Sustainability Management SAP Business Suite R&D

Purchasing

Manufacturing & SCM

Enterprise Asset Management

Sales & Marketing

Finance and Human Capital

Business Process Integration Health and Safety

Product Safety and Stewardship Compliance for Ingredients

Hazardous Substance Management

Substance & Material Management

Industrial Hygiene and Safety

MSDS and Label Management

Dangerous Goods Management

Incident/ Accident Management

Product Compliance Reporting

Supply Chain Collaboration

Preventive and Occupational Medicine

Customer and Supplier Communication

SAP Environment, Health & Safety (EHS) Management © 2011 SAP AG. All rights reserved.

Support for Legal Process

REACH and Product Compliance

Environmental Performance Air Emissions Resource Consumption Water Emissions Permit Management Waste Management

Environmental Compliance

Recycling Administration 43

Chemical Companies Build upon SAP Best Practices – North America, EMEA, MENA Chemical companies having implemented based on SAP Best Practices for Chemicals


44

Chemical Companies Build upon SAP Best Practices – India, China Chemical companies having implemented based on SAP Best Practices for Chemicals


45

Great Customers, Great Brands, Great Relationships

Applied Tech Products


46

Analyst Quotes: Live in 5 Months are real SAP Best Practices for Chemicals


47

Agenda



48

SAP Partners Serving the Plastics Industry Partner

Solution

Region

URL

it.chemicals

USA, EMEA

itelligence

Hi-Pace Chemicals

USA, APA

Hitachi Consulting

ChemOne

USA, India

Yash Technologies

All-in-One Chemicals

USA, EMEA

Enowa Consulting

AAES

EMEA, USA

Accenture

Note: All partners listed above offer SAP Business All-in-One solutions based on SAP Best Practices © 2011 SAP AG. All rights reserved.

49

Agenda



50

Gartner Validates SAP Business All-in-One “SAP has rich domain experience in target vertical markets, and many sub-sector solutions are offered by a globally diverse partner channel, which is tightly managed. The competency of the partner channel with respect to deployments and post-deployment modifications is strong.” “SAP Business All-in-One solution is one of the broadest and deepest solutions in the market, and its Best Practices and the fast-start program reduce the effort needed for the early phases of an implementation” “The Business All-in-One fast-start methodology and prepackaged offerings by major partners helps to improve successful on-time, onbudget deployments.”

Source: Gartner - Magic Quadrant for Midmarket and Tier 2-Oriented ERP for Product-Centric Companies, June 4, 2009 © 2011 SAP AG. All rights reserved.

51

HEWI – Heinrich Wilke: Injection Molder Establishes a Product-costing Analysis System Key Challenges  Increase transparency and efficiency in manufacturing processes and production scheduling  Establish a product-costing analysis system  Put in internal quality and management information system

Project Objective  Implement functionality for manufacturing and production

Why SAP Solutions  One-stop solution available through intelligence AG as supplier for license, integration, and hotline

Implementation Highlights  Implemented a fully integrated SAP ERP application  Rolled out SAP software to 318 users

Key benefits  Process optimization during connection to complex product variant structures for fitting hardware products

Web Site  www.hewi.com

Industry  Mill products – metal and plastics processing

Solutions and services  SAP ERP, which includes functionality for sales and distribution, materials management, production planning, variant configuration, warehouse management with radio frequency identification (RFID), quality management, financials, controlling, HR, and product life-cycle management  SAP Solution Manager application management solution

Existing environment  Intermec radio scanners with RFID technology, document management system, electronic data exchange, automatic shelf control, and interface to scales

Implementation partner  intelligence AG

 Permanent availability of information  Knowledge transfer through itelligence AG and SAP © 2011 SAP AG. All rights reserved.

52

Ace Plastics: Injection Molder Five-Month Implementation Company name  Ace Plastics Co. Limited www.acemold.com

Industry  Plastics injection tool making, molding, and secondary operations

Key challenges  Improve cost and business-segments analysis to develop growth strategies

Existing environment  ERP system

Implementation highlights  Fast implementation in just eight months  Thorough education provided for all departments, enabling excellent interdepartmental cooperation and support

Key benefits

 Increase financial visibility; reflect timely and accurate financial data and effective budget control

 Improved financial reporting efficiency by 70%, providing an upto-date, crystal-clear picture of the company’s financial status

 Enhance production planning and management; enable JIT delivery and effective inventory control

 Comprehensive and accurate cost analysis facilitates intelligent and fast decision making

 Achieve real-time management across different departments

 Integrated business processes and real-time information flow enable better production planning and operational efficiency

Solutions and services Functionality of SAP ERP

 Inventory control significantly improved, with purchasing lead-time reduced by 50%  Improved interdepartmental collaboration and accountability

 Financials and controlling  Materials management  Sales and distribution  Production planning


53

Grammer: SAP Supports Injection Molding Auto Supplier - Integrates production processes using SAP Summary  GRAMMER AG – an automotive supplier based in Amberg, Germany – integrated and optimized its production planning processes with software from the SAP for Automotive solution portfolio, including the SAP Advanced Planning & Optimization (SAP APO) component. The company can now ensure that it delivers its products on time.

Web site  www.grammer.com

Solutions and services  SAP APO, a part of the SAP Supply Chain Management application  Just-in-time and just-in-sequence software from SAP for Automotive

Why SAP solution  Covered all required functions  Precluded need for costly interfaces

 Used throughout the company since 1998

Key challenges  Minimize setup times and downtime

Implementation highlights

 Integrate production processes

 Process definition, customizing, and training in just three months

 Optimize buffer stock

 Easy integration of SAP APO into a complex overall process

 Improve ability to make changes and expedite product customizations

Project objectives

Key benefits  Reliable deadlines

 Optimize production planning to ensure that deadlines are met

 Versatile, customer-specific make-to-order production

 Utilize machines and tools optimally

 Detailed machine scheduling

 Use and expand internal SAP software expertise to meet future requirements promptly and independently

 Optimization of setup time


54

Toray Plastics: Implemented Five Divisions in Five Months Company name  Toray Plastics (America) Inc. - www.toraytpa.com

Industry  Synthetic fibers, textiles, and plastics

Existing environment  Ross Systems and legacy manufacturing execution system

Implementation highlights  Best-practices approach with SAP Enterprise Service Select  Five-month implementation time across five divisions

Key challenges  Build a solid foundation for continuous improvement activities  Streamline corporate structure  Improve customer satisfaction  Increase information access for better decision making  Standardize business processes

Implementation partner  SAP Consulting, part of SAP Customer Services Network

 High level of user acceptance with documentation and online support

Key benefits  Increased productivity  Inventory visibility  Streamlined processes  Platform for growth  Improved competitive position  Rapid implementation at lower cost

Solutions and services  SAP Enterprise Service Select  SAP ERP  RWD Info Pak delivered by SAP Education, part of SAP Customer Services Network  Offshore delivery services provided by SAP Consulting © 2011 SAP AG. All rights reserved.

55

AZ Electronic Materials: 15% Reduction in Inventory in First Year Summary  AZ Electronic Materials is a worldwide leader in electronic materials for the flat-panel display, semiconductor, and printing markets. Working with partner Accenture, the €400 million company used the SAP Best Practices for Chemicals offering to beat a tight deadline to bring up a worldwide information system.

Web site  www.az-em.com

Key challenges  Link separate information silos residing throughout subsidiaries to enable information transparency worldwide

Project objective  Install global information system across nine countries in less than one year

Solutions and services  SAP Best Practices for Chemicals  SAP NetWeaver Business Intelligence component  SAP ERP application, including the SAP Environment, Health & Safety application  SAP Recipe Management application © 2011 SAP AG. All rights reserved.

Why SAP solutions  Fast implementation times and lower total cost of ownership  Preconfigured business processes, allowing the company to meet an overwhelming percentage of its needs  Easily configurable software, enabling the company to accommodate different size business units and country-specific financial, statutory, and process requirements

Implementation highlights  Rapid implementation in nine months  On time at a fixed budget  Elimination of business blueprinting with preconfigured best practices  Strong executive sponsorship

Key benefits  Worldwide visibility into financial, sales, manufacturing, and supply-chain metrics  15% reduction in inventory in first year  Faster month-end close (three days instead of seven days)  Streamlined financial consolidation processes (a half day instead of eight days)  Less administrative work  Reduction in IT costs (less than 2% of revenue) 56

Thales Electron Devices: Injection Molding Medical Device Manufacturer Reduced time-to-market by up to 50%


57

Borealis: SAP Advanced Planning & Optimization (APO)


58

Borealis: SAP Advanced Planning & Optimization (APO)


59

REXAM Speeds Production Set-ups Using SAP


60

REXAM: 25% Reduction in Inventory Company Name  Rexam - www.rexam.com

Industry  Consumer packaging

Key Challenges

Implementation Highlights  Highly enthusiastic reception from vendors and customers  Personalized profiles used to constrain a vendor’s visibility into the system so the vendor views only authorized information  100+ portal profiles for suppliers

Key Benefits

 Improve key performance indicators for order-to-cash, demand-to-supply, and procure-to-pay processes

 Increased efficiency (85% of all cans in the Americas now ordered through the portal)

 Improve customer and supplier access to relevant information and key business processes

 Immediate execution of portal orders on the plant floor

Solutions and Services

 Time spend on special customer orders cut from 3 – 4 hours per week to 15 minutes per week

 SAP NetWeaver

 Improved cash flow (99.7% current accounts receivable for the Americas at close of year)

 SAP NetWeaver Portal and SAP NetWeaver Business Intelligence

 25% reduction in aluminum inventory  75% productivity improvement

Existing Environments  SAP Business Suite

 Easy portal access to critical information and for hundreds of employees, customers, and suppliers  30% reduction in call center staff


61

Customers……..

Applied Tech Products


62

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SAP Plastics Overview

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