system information technology bat taiwan

8/13/2019 System Information Technology Bat Taiwan

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BAT Taiwan:Implementing SAP for a Strategic Transition

DWITYA & LEE


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BAT Taiwan Company Background

BAT Taiwan and IT Optimizing

Lesson Learn from the Case

Todays Discussion

1

2

3


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BAT Taiwan

Company Background

BAT Taiwan was established in 1989.

BAT Group - the world's second largest stock market quoted tobaccobusiness.

3rd largest international tobacco company in Taiwan in terms of sales

volume: Average market share was approximately 8% in 2008.

160 employees in head office in Taipei and three area offices inTucheng, Taichung and Kaohsiung.

Business includes the importation, distribution, marketingand sale oftobacco products.

BAT Taiwan directly importing and won productsand selling directly to key accounts(7-11; Family Mart; Circle K; Hi Life, and Niko Mart) :

70,000 retails outlets


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BAT Taiwan

Company Background

New Business Model

Directlyimporting its

own productsand

Sellingdirectly to

key accounts(big 5

conveniencechains) andits distributor

Focus on

direct storedelivery

Piloted first in

Taipei


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BAT Taiwan

The IT Function at BAT

The global CIO (Globe House) : IT infrastructure, IT service delivery,e-business and business system initiatives, and IT people andprocesses.

Purpose: Increase emphasis on global strategies to help reduce thecosts of implementing integrated IT solutions and ongoing IT servicedelivery.

3 data centers geographically: Europe(Hamburg, Germany); NorthAmerica (Macon, Georgia);Asia Pacific (Kuala Lumpur, Malaysia)operate under a shared service model (regional level)


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BAT Taiwan

The IT Function at BAT

Responsible in:

identifying business requirements,

identifying IT solutions,

building business cases for IT projects, and

managing support services(including local, shared, and outsourced service.)

BAT Taiwan only has one IT technical support resource onsite fordesktop and LAN support, who has dotted-line report to the ITorganization for APN.


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BAT Taiwan

New Computer System for Taiwan: The ERP Choice

2 ERP platform standards had been prescribed for all BAT solutionsby 1998: SAP R/3 and Sage Tetra CS/3.

SAP R/3 Sage Tetra CS/3

Standard solution for larger Less complex

More complex BAT market Smaller operations that did not need thefunctionality of SAP

Very expensive system to implementand maintain

Required a low- cost ERP solution

Recommend for: sales and distribution(SD), material management (MM

Purchasing and inventorymanagement), financial (FI includingfixed assets), and controlling (COincluding profitable analysis)Phase II

Did not scale well, no longer viewed asthe best solution for BAT organizations

in rapidly growing markets.

Support direct importing and distributionto one customer (formal distribution)-

Phase I

Not viewed as a sufficiently robustsystem for HK market


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BAT Taiwan

Selecting an IT Partner

European or Asia Pacific?

Current BAT Taiwan: new and small; consider project cost; no requesta bid from an external consulting firm.

European (EDC or EcoE) Asia Pacific (APSS)Implementing R/3 Implementing R/3

Taiwan had experienced the datacenters high-quality operationalsupport

Template (code named Symphony )-similar business model in Singapore.

More extensive SAP implementationexperience

Ongoing operations and maintenanceroles:Lower personal cost, same time zone

Ongoing operations and maintenanceroles: Higher personal cost

Able to communicate more easily

Late 7 hours away in Europe Same natural synergies

- Mandarin speaking


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BAT Taiwan

Taiwans R/3 Project

Four primary businessprocesses:

Account receivables

Account payable

Inventory management

Plan-and manage-enterprise

Phase 1 Phase 2

Budget (Fixed-Cost) USD $100,000 USD $50,000

Man-days 250 (USD $ 77,700) USD $30,000

Other expenses Technology upgrades and direct expenses (travel andliving expenses for the APSS consultants)


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BAT Taiwan

Taiwans R/3 Project

Phase 1


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BAT Taiwan

Taiwans R/3 Project

Phase 2/A1

Consulted with the APSS Applications Manager, the Head of IT atAPN, and the other project team members,

A revised proposal was prepared by APSS, and the phase wasrenamed 1A to signal that the Phase 1 resources would continue onthe project team, rather than have a totally different implementation.


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BAT Taiwan

Taiwans R/3 Project


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BAT Taiwan

User Acceptance Testing and Change Management

1) BAT Taiwan hire additional temporarystaff prior to the User AcceptanceTesting

2) Delay in GUI integration with SAP leadthe team to execute a contingency planfor the first 2 weeks in January, creatingan additional burden on the team.

3) Compromise in Support afterImplementation

4) 2 APSS consultants onsite for 6 weeks

5) MM consultant onsite for 2 weeks6) FI/SD consultants onsite for 2 weeks

after the MM


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BAT Taiwan

Quality Review

In the first 3 months of service, the production server running theTaiwan system and need to assistance to take over problems.

In the weeks immediately following Go Live, procedural errors led to afew processing errors.

A multi-tier support plan is in place.

Some problems have surfaced over time and certain changes havebeen requested as users have learned more about how the systemworks.

For instance, a differential pricing policy was not initially specified, buthas been added to the configuration.


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BAT Taiwan

Post-Implementation in Taiwan

A formal post-implementation review, sponsored by GlobeHouse, was to be conducted toward the end of March2001. Other BAT managers are expected to be interestedin learning how the implementation was accomplished soquickly, at such a low cost, and whether the business users

were happy with the quality of the system.

Within APN, Hong Kong would probably be thenext end market to implement SAP.


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BAT Taiwan

Case Lesson to Learn

Learning from the past experiences of similar businesses should beutilized in making current project decisions, such as the unsatisfactoryimplementation of SAGE Tetra CS3 in Hong Kong

Ensure any project revisions remain within a reasonable scope

Include vendors in consultations for timeline revisions

IT and Business Managers work together to share the common goalsand build mutual trust of the project, and IT investment risk

SAP is a very powerful application for a small market. Initially you go

through a stage where you learn the basics but you dontyet know all thefunctionality. When you become proficient with the system, you begin to lookat other needs. APSS needs to be ready to show the business how to usethe system better what the more complex processes are that they couldntabsorb before.Mr. Ponce, Asia Pacific Regional IT Manager


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Thank you !

system information technology bat taiwan

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