DMG Mori: SAP S/4HANA as a business backbone

DMG Mori: SAP S/4HANA as a business backbone


The mechanical engineering company DMG Mori is switching from an outdated Baan ERP system to the new SAP version. […]

In 2018, the company decided to renew its 19-year-old ERP system from Baan. The aim was to make IT fit for new business areas, as the company wants to develop from a pure machine builder to a solution provider in the manufacturing environment. In addition, it was necessary to renew the most important business processes in order to be able to respond more quickly to customer needs. The global transformation project is called “GLOBE” (Global One Business Excellence).

The company took two years to analyze the existing processes and select a new platform and partners for implementation. “Since the entire DMG Mori value chain was affected by the project, it quickly became more complex than expected. Therefore, we split the overall scope into subprojects that were easier to handle individually,“ says Max Ruhwinkel, Head of Business Process Management and Program Manager.

Now SAP S/4HANA is set as the worldwide business backbone of the company. All parts of the value chain should converge in the system. The core applications for finance, sales and materials management form the center. In addition, there are other components, such as for procurement (ARIBA), planning (IBP), logistics (eWM), production (PP /DS) and export control (GTS). The Group’s own solution (ISTOS) is connected and fully integrated for production at the plants.

The financial and controlling systems of two holding companies switched to the new SAP software as early as 2020. Since January 17, 2022, the two plants in Bielefeld with almost 400 employees have also been running on the new factory template. “We want to use as much standard software as possible. The less we have to change, the faster the project progresses,“ says Ruhwinkel. In-house developments are only used where DMG Mori wants to stand out from the competition. In the end, the own share of the template for the works should be less than 30 percent. For those for sales and service companies, it should be less than a fifth.

After the go-live, a nearly three-month “hypercare phase” started. During this time, the entire 300-strong cross-functional project team, together with all external partners, will focus exclusively on the new platform. It is about ensuring smooth operation in the two plants and finding faults. Ruhwinkel: “At this stage, we would like to make as few changes to the systems as possible. If adjustments are necessary, then only as much as necessary to solve process blockages or fix errors.“

Afterwards, Ruhwinkel and his team want to adapt the IT organization and roll out the templates at all other locations. In addition, the experiences from the hypercare phase are to be incorporated into the platform and further adapted to the needs of employees and customers. Every evening, all SAP users receive a message with incident numbers, information on the speed of the solution and the tickets that are currently being processed. In this way, everyone has the same level of knowledge and can set their priorities correctly.

There are contact persons in every department who help employees in the business to use the new platform. In addition, users have been recording important key figures since the first day of the rollout, including the number of sales orders, logistics transactions, production output or users per day. Based on this, the platform is to be further developed.

IT has already used initial experience from the start-up phase to improve things. Ruhwinkel: “We have understood that communication is a central pillar of such transformation projects.“ If individual teams optimize processes without informing the others, an end-to-end process no longer works flawlessly. In addition, even the best system does not run if the data does not match the processes. The key is high data quality and data structures that match the processes.

The next step is to implement the template for the sales companies on the basis of the new SAP S/4HANA platform. In addition, the company will open a new ich China plant at the beginning of 2023, which will run entirely on the new SAP platform.

DMG Mori is currently building up the internal capabilities and capacities for all these tasks. “There are many exciting tasks and we are looking forward to new colleagues who will accompany us on this journey,” Ruhwinkel advertises.

*Jens Dose is editor of the CIO magazine. In addition to the core topics around CIOs and their projects, he also deals with the role of the CISO and its area of responsibility.

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