Heinz-Günter Lux

The path to an e-Business Process Integration Platform

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Traditional info flow between business partners

Requester ERPSystem

Customer Service

ERPR11…

Produktion

Customer/Supplier Evonik

Procurment Mail, Fax, Telefon

IT Process & Technologiekongress 2015 – Heinz-Günter Lux

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The chemical industry is still a digital laggard but has started to address the topic

?

Digital maturity curve

Stage I:

Not yet started

Stage II:

Early awareness for Digital

Stage III:

Strong awareness for Digital

Stage IV:

Digitally integrated

Stage V:

Digitally transformed

CPGUtilities

Retail

Pharma

Banking

Chemicals1Construction

High Tech

Automotive

Agro

Outside-in-perspective

1. Advanced on technical side (e.g. automatization)

The future is already here! —

it's just not very evenly distributed

William Gibson; Count Zero (1986)

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The e-business strategy project has to find answers for important questions

Procurement Logistics Marketing & Sales

Case for change Why is e-business relevant for Evonik and what is the aspiration level?

e-business architecture What is the best architectural option considering current situation and future developments?

Operating model What are process, capability and organizational requirements to successfully enable e-business?

Business case Is the implementation of e-business reasonable based on tangible benefits and cost for Evonik?

Way forward How should Evonik implement e-business considering an appropriate implementation logic (sequencing and timeline)?

Project scope

Marketing & SalesLogisticsProcurement

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External developments drive e-business across the value chain

• Shift of employee time from trans-actional to strategic procurement by automation

• Focus on strategic procurement• Intensified use of supplier

collaboration and platforms• Use of analytics to further optimize

decisions

• Higher acceptance for e-business by shipping companies

• Increasing transparency, early warning and agility

• More paper work for int’l business due to regulations

• Shift of CSO time from trans-actional to sales support service through automation

• Customers implement portals• Heterogeneous customer

integration requirements• Increased need for SC

transparency and responsiveness

• Industry platforms are emerging with not clear leaders yet• Emerging solutions for e-collaboration are driving cross-company productivity• Work becomes further computerized, automated and mobilized less error-prone

IT/service providers

Summary of external developments

Procurement/suppliers Logistics/LSPs1 M&S/Customers

DTP: Neue Folie aus Mail 2

Work-in-progress

1. LSP is “logistics service provider”

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To ensure a common understanding we agreed a joint definition of e-business

Evonik definition for e-business

„e-Business bezeichnet die digitale Geschäftsprozessintegration und umfasst den vollständigen elektronische Informationsfluss zur effizienten Durchführung jeglicher operativer Geschäftsprozesse zwischen allen Geschäftspartnern“

Definition German:

„e-business represents the digital integration of business processes including the entire electronic information flow to efficiently execute all types of operational business processes between all business partners“

Definition English:

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Customer

Order

Order confirmation

Border crossing inf

Order changes

Delivery notice

Weight and Packaging

lists

Quality documents

Goods receipt

Invoices

Gelangens-bestätigung

CarrierTracking

Information

Planning

Forecast

Inventory level

Remittance

Customer

Confirmationof changes

Distur-bances

Forwarder return inbound

outbound

Many information are exchanged between business partners

Evonik

IT Process & Technologiekongress 2015 – Heinz-Günter Lux

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The maximum value is only possible with full integration of all relevant business processes between all business partners

Requestor in his system System ExecutionConnector

InteroperabilitätConnectivity

Manual interventionfor faults

Manual interventionfor faults

This requires:100% flawless data quality in customer and supplierComplete end to end process integration with customer and supplierProcess synchronization at the interface between customer and supplier

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The architecture has to connect the efficient internal ERP world with a dynamic external world

e-business architecture overview

1. MD is „master data“

Customers

CustomerCustomerCustomer 1

Suppliers

CustomerCustomerSupplier 1CustomerCustomerService provider 1

Logistics

Evonik SAP R11 etc. MD1 TMS FunctionalityERP functionality

e-business integration layer (enables integration of different e-business platforms)

e-business platforms (provides specific functions)

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We screened 15 available e-business solutions based on a set of requirements

Screening of e-business solutions

15 11 8 3 1

Functional fit

Coverage of procure-ment, logistics, sales

Global scale

Footprint chemicals/ customer industries

Elemica

Multiplatform capable

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Elemica offers the most flexible solution to quickly shift to get into gear

Solution recommendation

+++––

Foodprint on chemicals

Global network

Flexibility to integrate further applications

Negative image at EvonikNo cross-industry standard

Functional coverage+

• Provides an off the shelf integration layer including an eBusiness platform

• Quick realization leveraging existing application

• Expand e-business and gain experience in the new way of working

• No fundamental barriers to integrate other solutions

Tool to establish e-business structures at Evonik

+ Multiplatform capable

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Elemica 2.0 e-business platform(order & order changes, invoices, logistics, VMI, Tolling, etc.)

e-business integration layer – “powered by Elemica 2.0”provides e.g. Supply Chain Visibility, Freight Cost Management applications, Multiplatform capability)

1. MD is „master data“; 2. illustrative examples only; 3. CEP is „courier, express and parcel“;

Further developing the architecture supports plug-ins for new channels and functionalities

Advanced e-business architecture

Other systems e.g. CEP2,3, marine data4, e-bill of lading2

Customer portals

Evonik SAP R11 etc. MD1 TMS FunctionalityERP functionality

Customers

CustomerCustomerCustomer 1

Suppliers

CustomerCustomerSupplier 1CustomerCustomerService provider 1

Logistics

- new -- new -

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The e-business platform integrates partners with different interfaces and other applications

Customer/supplier manual data entry• Limited integration with

double work on partner side• No cost for Evonik• Appropriate for small

partners or purely paper-based processes

Options to connect partners – Overview

Portal

EDICustomer/supplier email exchange of documents• Medium level of integration

based on automated processing of documents

• Low one-time cost to set up data structure

• Appropriate for medium-sized partners or limited degrees of electronic processing

Customer/supplier Portal or EDI• Highly integrated and automated• Medium cost for one-time set up of interface• Appropriate for large/strategic partners

For discussion

QuickLince-mail

Platform

Other applications Further functionalities/connections

• Potential Integration with other systems and platforms

• Provision of additional segment-specific functionalities beyond standard

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E-business can be implemented in steps –Efficiency is the first gear for a “digital sprint”

Roadmap: Three gears toward e-business excellence

Increase agility using real-time value chain transparency to

avoid interruptions and enable customer information

Drive automation and reduce data errors in administrative processes enabling focus on

value-adding activities

Efficiency gear

Agility gear

Leveraged value gear

~2016 ~2017 ~2018 – 2020Start

Leverage data pools for supply chain performance reporting,

enriched data and advanced value chain analytics

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BASFeBusiness PlattformTeamShell

eBusiness PlattformTeam

Set up a network of key people – enabler – on a company level integrated into the internal structure

EvonikeBusiness PlattformTeam

e-business contact person

e-business key user

customer service, order management, operational logistics

Internal eBusiness execution

ExternaleBusiness Network

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