Success Story

With ORBIS and SAP IBP: The Uelzena group digitalizes and optimizes rough sales and production planning

Sectors: Manufacturing industry, Construction supplier industry, Steel / Steel Service Center / Metal industry, Electro and electronic industry, Machinery and plant manufacturing, Consumer goods / retail
Processes: IT, Intralogistics, Warehouse control, Manufacturing, Data Management
References: Uelzena eG

The Uelzena dairy cooperative drives forward its digitalization strategy through the consistent modernization of its IT landscape. The introduction of the SAP IBP cloud solution to optimize rough sales and production planning, which supplements the digital ERP core system SAP S/4HANA, is another important step in this process.  Uelzena entrusted ORBIS SE with the implementation and customization of this supply chain planning solution.

Whether it is butter, concentrated butter, milk powder, standardized and individual milk fat or instant beverages: Uelzena eG from the Hanseatic town of Uelzen in Lower Saxony, and thus the name sake of the cooperatively organized company, has developed, produced and marketed various products and ingredients derived from milk for over 70 years, and has done so with consistently high quality. Consumers are familiar with branded products, for example Butaris concentrated butter, which is used for baking, roasting, cooking and frying, or TRILACTIS butter to produce butter pastries. What most people don’t know is that: Uelzena also makes customized white label products for customers, who include global companies from the ingredients, confectionery, bakery, delicatessen and hot beverages industries, as well as companies from the vending industry.

Uelzena eG

Head office: Uelzen, Germany
Products: Milk powder, butter, butterfat, cheese, sweetened condensed milk and other milk-based ingredients and products, non-dairy dried products, contract dried products such as flavors, natural color powders and vitamins for the food processing industry
Locations: 4 production sites in Northern Germany
Employees: around 800 

The group has always sourced the milk for its products and ingredients from the North German region. Consistent monitoring of the production chain from the raw materials procurement to the completion ensures the high quality of the final products. This is an important factor for the economic success of the dairy cooperative which has regional roots and which, thanks to its internationally-aligned sales concept, also continues to expand. In 2022, the group, with around 830 employees at four production sites in North Germany, achieved a turnover of around EUR 1.08 billion.

SAP S/4HANA as a digital core system

In order to also continue to grow healthily on its own and to operate sustainably in the long term, Uelzena has established five main fields of action: company, employees, products, production and regionality, as a compass for such business development. Specific targets are formulated for each of these individual fields of action. For example, in the area of production, “greater profitability” is specified as one of a number of targets.

An important requirement for economic success is also efficient and transparent business processes in all areas. The dairy cooperative has handled its operations for years using integrated functions from the SAP ERP business software. The group changed to SAP S/4HANA as early as 2019 as part of its long-term IT modernization program. Using this ERP suite from SAP as a digital core system, digitalization of business processes can be driven forward in a decisive way and their efficiency further increased as well as the position strengthened among the competition.

Supply chain optimization with SAP IBP

SAP S/4HANA will, if necessary, be expanded with strategically important solutions relevant for competition. This in particular includes the cloud application SAP Integrated Business Planning (SAP IBP) as the cornerstone for comprehensive optimization of supply chain management, which Uelzena has initiated in parallel with its switch to the new ERP suite. The background to introducing SAP IBP was that a situation analysis showed a need for action in matters of IT support with the rough sales and production planning. The group had carried out this central and, thus business-critical, process up to that time with SAP CO-PA standard functions.

In order to simplify, speed up and make rough sales and production planning more transparent, those in charge looked for modern software, which also uses prognostic algorithms, and they found this in SAP IBP. Crucial for the selection of this cloud application was in large part the fact that the use of SAP solutions is part of the business and IT strategy at Uelzena and its implementation, compared with that of a third-party tool, promised a notably lower IT risk.

Continuous rough sales and production planning

At present, SAP IBP is used for Sales and Operations (S&OP). And successfully so:

„Using SAP IBP S&OP, we now carry out rough sales and production planning quickly and efficiently with continuous IT support. This is a decisive step towards process digitalization using the cloud and optimizing the entire supply chain at the Uelzena group“, says Bernd Täger, Head of Organization/IT at Uelzen eG.

Bernd Täger, Head of Organization / IT at Uelzena eG

The comparison of the planning data with the production capacities noticeably increases the transparency in relation to the utilization of the facilities, and bottlenecks are identified early. The cross-departmental cooperation between sales and order clarification as part of production planning and materials scheduling has also been noticeably improved. 

Aside from this, around 80 end users appreciate the easy use of the cloud solution since they carry out their planning work in an Excel add-in and therefore using the familiar Excel interface. Furthermore, intuitive SAP Fiori web apps display figures and analysis reports as an overview on the Dashboard, which can be called up at any time and from anywhere.

Successful implementation with IT partner ORBIS

Uelzena tasked ORBIS with the implementation of the software. Thanks to the partnership-like cooperation and the knowledge of the ORBIS advisors, the fully-remotely executed IT project could be completed quickly, including all customizations to the group’s special requirements.

Backlogs or shortfalls in milk raw materials are displayed in an overview with figures and tabs in SAP IBP created especially for this purpose. Detailed production planning is also integrated into the cloud-based planning solution via copy operators and business logic. In order to transfer contract data from SAP S/4HANA for sales planning automatically into SAP IBP, both applications have been linked via SAP Cloud Integration for Data Services. 

Due to the consistently positive experiences, the continuous expansion of SAP IBP is being driven forward at the Uelzena group.

Source Photo: © Uelzena EG

Concentrated butter production Uelzena
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