SAP Customer Success Story Engineering

ALSTOM is a global leader in energy and transport infrastructure, employing 118,000 staff in 70 countries world-wide and with annual sales in excess of 23 billion Euros. In energy it specialises in power generation, transmission and distribution, and in transport has particular expertise and experience in the rail and maritime sectors.

ALSTOM SUCCESS STORY

HOW SAP AND LOGICACMG ARE ENGINEERING SUCCESS FOR ALSTOM.

In the UK, the company has a long and varied history spanning three centuries, with a rich heritage of engineering experience and long tradition of excellence in design and manufacture. The ALSTOM of today is a modern, innovative organisation offering infrastructure solutions now and for decades to come. One of the countrys largest manufacturers and a major exporter, it employs nearly 14,000 people at five principal sites in Rugby, Stafford, Birmingham, Lincoln and Manchester. Over the years, the companys growth has been primarily fuelled by acquisition, which brings its own challenges in the modern business world and thats where SAP and LogicaCMG have been able to help.

STANDARDISING ON SAP

ALSTOM has been formed by the merger and acquisition of a large number of companies, says ALSTOMs UK IT Director Mark Lewis, and in doing so weve taken on companies that are using alternative systems. Its that process of reviewing these different systems that has led us to the decision to standardise on SAP as our ERP system. The ALSTOM business units around the world can range in size from 30 or 40 employees at a location to over 1,000, and may well have different business drivers, confirms Colin Haynes, Stafford Local Service Centre Manager at ALSTOM. But they all have to be part of corporate ALSTOM, and so systems which can integrate and bring together corporate information and reporting are critical. SAP is one of the leading ERP solutions in the world, so it seems a natural choice for a business of our size.
ALSTOM has been formed by the merger and acquisition of a large number of companies, says ALSTOMs UK IT Director Mark Lewis, and in doing so weve taken on companies that are using alternative systems. Its that process of reviewing these different systems that has led us to the decision to standardise on SAP as our ERP system.

As a major SAP user, there are often up to four or five projects running within ALSTOM at any one time. Each project is fundamentally different because each business is fundamentally different in terms of the processes they operate, says Mark, but by implementing SAP and trying to do it in as standard a way as possible weve managed to get many of the processes harmonised in some of the different businesses. This has great advantages in being able to consolidate information within ALSTOM corporately and individual local businesses.
LEANING ON LOGICACMG

LogicaCMG is ALSTOMs preferred implementation partner, and according to Mark Lewis this is due to the strength of the relationship that has developed over time: Weve been implementing SAP systems with LogicaCMG for the last ten years and many of our early implementations were undertaken with them. As part of a major structural reorganisation in 2002, ALSTOM took the opportunity to reorganise its IT resources, forming a series of internal service provider organisations known as IT Centres. We have also used other partners for full or partial implementations, and when we formed the IT Centre we decided to look at the different partners we were working with and to standardise on one partner for future implementations. We found that LogicaCMG were very good in terms of quality, delivery and price, and decided to go with them. In the UK the IT Centre comprises around 200 people supporting all the different ALSTOM businesses in the UK, and the relationship with LogicaCMG since then has been extremely good. Every project has its own issues and difficulties, but weve been particularly impressed with the way LogicaCMG has responded when we do hit problems, says Mark. This is a sentiment echoed by Donella Duffy, Programme Manager with LogicaCMGs SAP Practice: We were awarded preferred supplier status because of our flexibility, our can do attitude and our ability to work with the IT Centre to develop its people and improve their skills. We can also improve their knowledge through our experiences of working in other ALSTOM businesses.

Although SAP is now the preferred choice for ALSTOM, the distributed nature of the company means there is a high degree of autonomy within the individual business units. Its still been necessary to get buy-in at all levels, as the ultimate investment decision is left to the local Managing Director, says Mark Lewis. The process of getting that buy-in has involved communication, reference visits within and outside the company, and a lot of hard work and effort from the people involved in the different projects within ALSTOM.

MANAGING CHANGE

I think typically the biggest challenge on any SAP project is getting the right level and quality of resource, suggests Colin Haynes. Not only on the IT side from a consulting partner but also internally from within the businesses. Business and process knowledge is critical and where we can get major players in a department or function involved full time in these projects then typically they are very successful.

As with most projects, the significant challenges are mainly people-related. Its the changes in culture and processes that are always difficult to address, says Mark Lewis. Another area of difficulty is in terms of the technology. What you have to remember is that in many of these business units were migrating from some old technology and systems into a modern up-to-date system. That process has to be carefully managed and organised. I think typically the biggest challenge on any SAP project is getting the right level and quality of resource, suggests Colin Haynes. Not only on the IT side from a consulting partner but also internally from within the businesses. Business and process knowledge is critical and where we can get major players in a department or function involved full time in these projects then typically they are very successful. According to Colin, end users will typically begin to see the benefits a couple of months into an SAP implementation: When a system goes live, end users will have received quite a bit of training and will soon see the benefits particularly the ease of access to information. Users tell me that the most powerful feature of SAP is the ability to look at figures in overview and then drill down to the detail where those figures are potentially at variance, and so quickly gain an understanding of whats going on within their particular role or function. Certainly the user interface is much better than some of the traditional ERP systems that theyve experienced.
THE SAP COMPETENCY CENTRE

The SAP Competency Centre is staffed by around 20 people drawn from different backgrounds. The system specialists (who look after security, authorisations and the availability and reliability of the system) are typically technology professionals which the company has drawn from different disciplines and retrained in basic SAP skills. The business systems analysts tend to come from within the ALSTOM business units, and bring a wealth of business process knowledge. Combined with the SAP skills, the Centre thus provides a powerful service to ALSTOMs end users.
ALSTOM, SAP AND LOGICACMG

Another important success factor has been the creation of an SAP Competency Centre hosted at ALSTOMs Stafford site. According to Colin Haynes, the Centre is there to support business units as a primary point of contact for any issues regarding SAP. We have five individual systems in the UK that we support, and one international system thats currently supporting around 500 users in the UK, United States and France and is in the process of deploying to other areas around the world. That support can be application support or helping the end user in developing their use and knowledge of that system through training and individual coaching.

I think that one of the main benefits of these SAP implementations in the UK is that we can focus our knowledge and experience on the SAP product and its fit to our businesses, says Mark. I would certainly recommend LogicaCMG to another customer for SAP implementations, and I think one of the principal reasons is because of the very good and professional relationship weve had with them. Colin Haynes, Stafford Local Service Centre Manager, ALSTOM ALSTOM has to deliver quickly, it has to deliver accurately and it has to deliver a good quality product time after time. Having access to business information, having access to key decision making criteria is absolutely critical. We need that flexibility SAP gives that to us. Interviewed: 21st August 2002.

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