The professional lighting division from an international electronic group shows how it´s done
The lighting systems division of the international group, is a typical example in many respects. The company certainly had its SAP hardware and software costs under control. Nevertheless, the management was dissatisfied with the SAP costs it was incurring and decided to conduct an analysis of its internal processes.
Within eight weeks, a team from Maturity analyzed all the relevant operative and crosssection processes and identified the weak - nesses in the process organization. One of the main strengths of the company, its decentralized organization, proved to be a weakness in this context. When considered individually, the various business units certainly had excellent cost structures; but when they were viewed as a whole, the costs were well above those of their peer group. The system environments within the business units differed wildly both in terms of process complexity and the application maturity (age of the application, number of changes, and staff experience), depending on the specific requirements of the internal corporate customers. It was therefore decided — taking into account these very different complexity parameters — to work out which of the processes could be optimized and, if necessary, standardized and integrated at the user level.
Finding the right solution
Finding the right solution between centralization and decentralization was the order of the day. One of the core questions in this respect was: Which of the business units set standards, and which standards could be transferred from one business unit to the others? Step by step, the team analyzed which business unit used the various processes most effectively, what the reasons for this were, and what costs were incurred as a result. On this basis, it was then possible to examine in detail which processes could be consolidated and which would be more effectively handled individually. For example, one business unit had introduced a very complex but also very powerful archiving system from SAP. The other business units only needed a smaller archiving solution and were able to jump into the system very easily without having to maintain their own archiving capacities. In another instance, two business units of differing sizes had a very similar business; in this case, it was obvious that the existing SAP system could simply be consolidated and managed in a similar way, with the smaller business unit acting as an additional department of the larger business unit.
Joint expertise management
The central IT department set up a joint training for all users so that key users from different business units could get training together. The company has also established a uniform knowledge management and reporting system for all the business units; moreover, all negotiations with outsourcing service providers are conducted on a joint basis. Another of Maturity’s core recommendations was the introduction of a “championship” organization. The central IT department has to know who has the greatest competence in a specific field, so that this person then acts as an advisor to everyone else and can also take responsibility for certain processes for all BUs. For example, a person in the IT department was discovered to be extremely competent in matters relating to ITIL standards; today he works as the “ITIL Champion Coach” for other business units as well (ITIL stands for IT Infrastructure Library, the current global de facto standard in the field of service management).
Massive cost savings
As a result of the joint use of individual platforms such as the archiving system, the lighting division now saves around 20% of its previous costs. In addition, the optimized interfaces to computer center service providers ensure that staff can be used more efficiently. Considerably lower staffing levels are required to coordinate the service provider than was the case prior to the project — with the remaining staff now being able to support the planning department. Finally, the fact that the business units now hold negotiations jointly has proved a major bonus in terms of prices: the lighting division managed to reduce the price of a new enterprise storage solution plus hardware components by 15% as a result of all the business units negotiating jointly.
Download the case study IT benchmark at lighting division as a PDF file