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Case Study: Philips Medical Systems’ SAP Global Implementation

Larry SimanakDirector of Customer ServicePhilips Medical Systems

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The Scope

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Solution architecture for PMS HSG

ALE

Integrated ClientSAP 4.6c

Factory AndoverSAP 4.6c

Factory BöblingenSAP 4.6c

Factory Zymed

Factory HeartStream

RoW

Japan

SSD

PMG

Field Operations

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Americas EMEA

ArgentinaBrazilCanadaMexicoPuerto RicoUS FactoryUS FieldUS MiamiVenezuela

AustriaBelgiumFinlandFranceGermanyItalyNetherlandsPolandPortugalRussiaSpainSwedenSwitzerlandGenevaUK

ASPAC

AustraliaChinaHong KongIndiaJapanKoreaMalaysiaSingaporeTaiwanThailand

United States: 95 sites, 3000 usersEurope: 55 sites, 1400 usersAsia/Pacific: 40 sites, 540 usersLatin America: 12 sites, 120 usersCanada: 10 sites, 90 users

Complicated Program•Many Users &•Many Countries & •Many Languages &•High Deadline Pressure

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HSG/CMS Rollout Planning - Final

2001 2002MarDec Jan Feb Apr JunMay July Aug NovSep Oct

UK / HK-Ch

ItalyGermany

Tier 218.7%

USA

Canada, MexJapan

Tier 164.5%

Benelux/India

Iberia (Sp/Po) /Australia/NZ

Tier 3

CMS Pilot France Live Test

Direct Export Hubs: Geneva (1/9) : Andover (1/9)

Direct Export Countries

Agilent will extract data for all current legal entities. This will cover both

current & Day 2 Direct Export countries.

Direct Export Countries

Agilent will extract data for all current legal entities. This will cover both

current & Day 2 Direct Export countries.

SLI: Boeb 1/7 : Memphis 1/9SLI: Boeb 1/7 : Memphis 1/9

Austria-Switz/Swe/Fin/Tai/Kor/Thai/Mal/SingTier 4

BusW/house

FranceLive1/6

BusSign-off22/5

GapRes

~20/3

FactoryLive

Tier 1 + 4Live

Tier 2 + 3Live

MasterData~29/3

Freeze IC – Fixes Yes / New functionality No

InegralTesting

22/4

Merge Centres: Boeb 1/9 :And 1/9 Merge Centres: Boeb 1/9 :And 1/9

Poland:

Nov or Dec

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The Restraints

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Key Business Driver:

Get Off SLAs by September 1, 2002

Situation:

CMS/ISY has one year from Day 1 to replace all information technology systems that are maintained by Service Level Agreements with Agilent or HP. Over the same period, CMS/ISY must integrate into the Philips system architecture.

This presents an enormous challenge and opportunity to standardize our processes and systems, and improve both customer satisfaction and organization efficiency.

HSG IT Separation replaces the IT Business systems under agreement with Agilent.

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We are paying 10 M$ per month to Agilent for SLAs !

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

Aug-01 Sep-01 Oct-01 Nov-01 Dec-01 Jan-02 Feb-02 Mar-02 Apr-02 May-02 Jun-02 Jul-02 Aug-02 Sep-02 Oct-02

Mill

ions

$ /

Month

Total: $154 million

If we extend the SLAs beyond September 1st, we pay substantial penalties

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Complexity

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Country 1..7

Stream 1..8

Workstream Project Plans

Rollout Project Plans

Factory

SAP IC Gap

Office Moves

Infrastructure

USA/CA

JP

Ger

IT

HK / CH

UK

FR

Comp. Sol.

Detailed Cutover Plan

Cutover PlanSummary Overview

Other

Emails

MS Project Plan

Scoping

Global Overview Plan

Interfaces

Data Extraction

SAP IC Rollout

Document Index (1/plan):Supports &Explains Statuses for Drill Down

Note: 0nly Tier 1 & 2 countries being tracked

Inverse information flow for drill on status

exceptions

Country 1..7

Stream 1..8

Cutover Tracking Plans

Direct Export

BW

SLI Rollout

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Integrated Client

The SAP Integrated Client is the single

SAP standard for PMS• OAP/ORP

• Finance

• Service Management

• Service Logistics International

• Direct Export

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Integrated Client

PMS has decided to develop and implement

Integrated Client• To reduce management and maintenance costs

• To improve reporting capabilities (speed)

• To standardize business processes worldwide while keeping

regional flexibility

• To reduce interfacing problems

• To facilitate connection to worldwide PMS data

Integrated Client v3.0 is rolled out to the SSDs.

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SAP R/3 4.6c

• CDM/CDQS

•Vamp

•Nessie

•ERMT

•EDS

Product Data Management

Design Gatewa

y

MSM Suite (5)

• SSUI

• NAP

Deliver

XMS

Supply Planning

• Fourth Shift

• Epicor

Heartstream, Zymed • Defoa

• DOA• Laser

Labeling• PTM• JetForms

Build

Get Smart (EOQ/

SS)

Web Req

Data Warehouse

Hermes

Finance

HPDL (2)

PERSEUS

• CVR

• Kronos

• TRECS

• EDM

• Soli

• Employee Survey

• CDA Tracking

• Target

Product Generation

NOVAeDMR

EDI Gatewa

y

• CAPA

• QSMT

• TEDS

Gecko* Replacem

nt

Odessa

Insight Complaint Handling

KEY: = Modify

= Interface

= Clone

= New

Performance Mgmt

Marketing

Other/HR Q & R Workplace Services

Demand Planning

NERDD

DAWGTV Freq. Mgmt

eDHR/eDHT

TER/EER

SFC IPP

KEY:

• Bulleted text = Status Quo

* Waiting on replacement decision

Totals

Clone = 11

Interface = 6

Modify = 14

New = 1 (excludes 2 D2+)

Status Quo = 25

As of 04/02/02

HPDL-MSM Dly

Upds

MSM-GEM Master

CRS2000 Replacemen

t*

Supplier Mgmt

Lotus Notes - Various

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Build to Stock (1-5d)

Off the shelf (same day)

Build to Order (2-6w)

SAP Factory and SAP IC are closely linked

Solutions (>6w)

SAP SSD ICSAP SSD ICSAP PMG SAP PMG CMS/ISYCMS/ISY

• Ultrasound 4500/5500• CMS• Telemetry• Codemaster defibs

• Cardiographs• AEDs• OptiGo• A1, A3 monitors• Holter

• paper• electrodes• Point-of-Care

supplies• defib pads• stethods• AEDs

local/regional

stock

SalesOrder

PMG prices

salesorder

purch.order pu

rch

asin

go

rder

s (M

M)

sales orders(SD)

qu

ote

man

agem

ent

• Enconcert• Agilent Info Center• CareVue• OBTraceView

Var.Conf.

sale

s o

rder

man

agem

ent

SSDcatalogue

configurableproduct info

PM

G p

rod

uct

rep

r.

Var

ian

t C

on

fig

ura

tor

SSD local currencylist price calc.

invoice

installed baseconfigurationmanufacturing

product

basic product infoMaterial

Master data MaterialMaster

data

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Ying & Yang

What went right

Improvements

Take away’s

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What went right?

Project Structure• Project team was formed early

and experienced as part of previous initiative towards ERP

• Full-time Project Manager assigned with Key subproject leads assigned full-time at critical point in project

• Business team and Consultants located together with Project Mgr.

• Cross-functional team formed at project level with weekly review meetings (Sales, Logistics, Service and Finance)

• Consistent project review meetings-weekly conference calls with CS project team. Face to face approx. once/mth.

• Clear ownership for project team-MRC, Field Delivery, Data Migration, etc.

Business

• Steering Committee in place made

up of Senior Support Management

team to provide quick policy

decisions and provide direction

when needed.

• Prototyping allowed testing of

processes, although this was done

on legacy tools.

• Committed team members, willing

to work very extended hours

based on compressed nature of

the project

• Commitment to attending training

courses

• CLIC newsletter developed for

Field communications

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Challenges/areas for Improvement? Complexity of the project

Project design phase continued well into

implementation phase.• Made knowledge transfer difficult

• Affected ability to prototype and test

• Affected documentation-many work instruction

incomplete late into the project, which impacted

training.

Design isolated from roll-out teams

Very time constrained project limited

time in all phases do to SLA’s

Lack of local control over data cleanup

efforts made it difficult to monitor and

control status

Competing field activities prevented fully

focused field data cleanup efforts

Data migration was not tied to business

(migration team being formed for next

project phase)

A large discrepancy in the accuracy of

the installed base (clean-up early)

Design flaws in the logistic (SLI/SSD

processes)• Logistics process (being redesigned)

Not using SAP

Not enough emphasis on change

management as necessary early in the

project• Senior Management communication

• Focused owner for communication

• Early development of most effective tool (CLIC

Newsletter)

Numerous fixes created (issues being

resolved by issue management)

Ability of roll-out teams to create

effective design changes based on clear

SAP practices

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Take a ways

Project• Close connection between design

and roll-out

• Forced completion of issue

management within the team

• Keep consultants and business

organized together (centralized)

• Control of critical path issues within

the roll-out teams

• Settle data migration issues early

• Training

Learn the process

Understand the tools

• Committed staff

Business• Change management

• Communication

• Data migration Clean up the installed base Close all transactional data early Reduce unnecessary inventory Clear up Financial transactions

• Training

Learn the process

Understand the tools

• Management commitment to the

principles and processes

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R

“Integrated Client” for Customer Services