As a newly formed company, driving cost-efficient manufacturing and distribution operations were key goals for Hellenic Glass Industry. How could it gain tight control over its processes?
Hellenic Glass Industry engaged IBM Services to design integrated business processes, supported by SAP S/4HANA running on IBM Services for Managed SAP Applications.
50%increase in operational efficiency predicted
Up to 80%faster group-level reporting will enable timely decision-making
Reducesoperational costs, helping to protect against revenue risks
Business challenge story
Forging a new business
Hellenic Glass Industry (HGI) was born in the wake of the global financial slowdown, and spun off from a larger company called Yioula Glassworks S.A. in 2017. HGI inherited factories in Bulgaria and Ukraine, as well as distribution centers in Romania and Greece.
Elias Stassinos, Chief Information Officer at Hellenic Glass Industry S.A., explains the challenges the new company faced: “Each of our manufacturing and distribution sites were effectively run as separate businesses. Because each location had its own approach to managing and reporting on its activities, it was extremely difficult to gain a single, accurate overview of our performance at the group level.”
Manolis Kainourgiakis, Deputy Group CEO and Group CFO at Hellenic Glass Industry S.A., elaborates, “As a newly independent company operating in a volatile economic climate, operational cost-efficiency was a key goal from the start. How could we build a solid operational foundation while enabling a sustainable future for the business?”
Targeting an integrated model
While distributed working practices offered autonomy to each business unit, HGI was missing out on economies of scale. With fragmented data management it was very difficult to answer key questions in a timely manner, such as which products are selling best? or which products generate the greatest margin? Without accurate information, HGI risked losing critical revenues or failing to optimize profitability.
At the start of each month, Hellenic Glass Industry’s factories and distribution centers would share data on orders, production and inventory levels to the company’s central finance function in spreadsheet format.
Closing the books each month often required three weeks of time-consuming manual work—leaving little time for the company to identify and act on potential opportunities and threats.
To solve the challenge, Hellenic Glass Industry decided to use group-wide metrics and key performance indicators (KPIs) to understand performance and efficiency, with ambitious targets for information delivery.
“By becoming an integrated business, we were confident that we could improve our efficiency and reduce our exposure to revenue risks,” says Manolis Kainourgiakis. “But clearly our spreadsheet systems were not up to the task. We set about defining our requirements, and searching for a cost-effective business solution.”
Selecting a future-ready solution
Former parent company Yioula Glassworks had relied on multiple different ERP platforms to run its core business processes. The HGI team realized that they had an opportunity to implement an integrated system for the new company, taking advantage of best-practices while tailoring the solutions for HGI.
Manolis Kainourgiakis confirms, “We quickly recognized that SAP S/4HANA offered us a highly effective way to manage our operations: with one definition for our KPIs, one version of the truth for our business data, and standardized business processes for all our operations.”
Hellenic Glass Industry selected SAP S/4HANA with applications for financials and controlling, production planning, warehouse management, logistics execution and plant maintenance. Elias Stassinos comments: “Another big factor behind our decision to make SAP S/4HANA the foundation for our new business was the company’s local presence in Greece. We see that SAP is one of the leaders in our market, and that gave us confidence that the solution would meet our specific operational needs.”
Engaging an expert partner
To help it map out its business processes and configure the SAP S/4HANA solutions to support the new way of working, Hellenic Glass Industry engaged experts from IBM Services. “We chose IBM Services because it was clear from the very beginning that they really wanted to make our project a success,” says Elias Stassinos.
“IBM followed a best-practice approach based on its Ascend methodology for SAP S/4HANA, combined with good faith, professionalism and flexibility that kept the project moving forward when there were bumps in the road.”
Deploying a high-performance platform
Working with IBM Services, Hellenic Glass Industry successfully deployed SAP S/4HANA using IBM Services for Managed SAP Applications, an infrastructure-as-a-service (IaaS) private cloud solution based on highly reliable IBM Power® S824 servers and IBM DS8870 storage.
Delivered from an IBM data center in Greece, SAP S/4HANA is running on the SUSE Linux Enterprise Server for SAP Applications operating system.
“When it came to selecting the infrastructure platform for our SAP solution, IBM stood out as the clear choice,” says Manolis Kainourgiakis.
“We have used IBM Systems to support our global business for more than ten years, and the solutions have never let us down.
“Based on our positive experience of working with IBM in the past, we knew they had the technical expertise and project-management capabilities to support us effectively on our transformation journey.
“By choosing IBM Services for Managed SAP Applications, we gain the performance of IBM POWER8®-processor-based systems without the need for costly capital investment in new infrastructure.”
Today, the company is training its global workforce in the new workflows, which include procurement, sales and warehouse and inventory management.
“Our SAP S/4HANA environment is now fully operational, and our next goal is to empower our people with the skills they need to transition away from manual, spreadsheet-based processes and embrace the SAP workflows,” adds Manolis Kainourgiakis.
“Our relationship with IBM Services continues to be extremely valuable, and the IBM team is providing ongoing assistance with training for our employees.”
Unifying the global business
As it continues to drive its digital transformation using SAP S/4HANA on IBM Services for Managed SAP Applications, Hellenic Glass Industry is confident that it has the capabilities it needs to shape lean, cost-efficient global operations.
Every pallet of products is now assigned a unique identifier in SAP S/4HANA, which is attached as a barcode and scanned as the products move through the supply chain. With all production, inventory and logistics data managed by SAP S/4HANA, HGI has immediate and accurate insight into stock available for sale, and where it is in the business.
Gaining granular insights
Today, Hellenic Glass Industry can produce accurate reports on KPIs at the group level, including the number of products manufactured daily, the number of consignments shipped to its distribution facilities, and the available space in its warehouses. Crucially, the company’s finance team can use this data to complete the monthly close in a fraction of the time.
“In the past, we would typically need until the 22nd day of the month to close our books, but since working with IBM Services to deploy SAP S/4HANA, we’ve cut the close down to the 8th day of the month: 63 percent faster,” says Manolis Kainourgiakis.
“The sooner we close our books, the sooner we can determine whether we are on target to achieve our revenue goals—and the faster closing we’re achieving with IBM and SAP will equip us to make proactive decisions in a competitive market. We’re continuing to push for increased efficiency, and we believe we will eventually be able to achieve a five-day close.”
Lifting efficiency to new heights
As employees complete the transition to using SAP S/4HANA, Hellenic Glass Industry predicts that it will substantially increase efficiency in many areas of the business.
“One of the big disadvantages of working with spreadsheets is the fact that they quickly balloon in size and complexity, which makes keeping them up to date a time-consuming process,” says Elias Stassinos. “On average, we estimate that our employees working with spreadsheets have to re-key data in three different places—reducing efficiency and increasing the risk of human error. Within the next year, we predict that fully switching SAP S/4HANA will boost operational efficiency in our production, warehouse and administration teams by 50 percent, and by as much as 80 percent for our group-level business analysts.”
Manolis Kainourgiakis adds: “Using SAP S/4HANA on IBM Services for Managed SAP Applications, our aim is to minimize the time required to complete key processes, beginning with our sales workflows. Greater efficiency across the business will help lower our operational costs, increase our agility and improve our ability to compete in a tough marketplace. Our ultimate goal is to increase our earnings before interest, tax, depreciation and amortization [EBITDA] margin to 35 percent—and our IBM and SAP solutions will make an important contribution to achieving it.”
Ready for the future
By putting accurate business data into the hands of its senior decision-makers, Hellenic Glass Industry aims to help its leadership team steer well-informed, data-driven decisions. To make these business insights even easier to access on any device, the company is preparing to enhance its solution with SAP mobility solutions.
“The ability to pick up a tablet and see how all the parts of our international business are performing in near-real time is a huge innovation,” concludes Manolis Kainourgiakis. “Thanks to our work with IBM Services to deploy SAP S/4HANA on a private cloud based on IBM Power Systems servers, we are building a lean, efficient business that can weather even the most rugged economic conditions.”
About Hellenic Glass Industry S.A.
Headquartered in Mandra, Greece, Hellenic Glass Industry S.A. is a leading manufacturer and distributor of glass products. Specializing in containers and tableware, the company operates manufacturing centers in Bulgaria and Ukraine, and distribution centers in Romania and Greece.
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