Metalloinvest transforms its business processes using the principles of Industry 4.0
13 July 2018
Metalloinvest, a leading global iron ore and merchant HBI producer and supplier, and one of the regional producers of high-quality steel, and SAP, one of the global leaders in the corporate software market, have announced a successful start to the operations of their integrated financial and business management system, using the SAP S/4HANA business suite.
Launched at Lebedinsky GOK and Mikhailovsky GOK, Metalloinvest’s iron ore processing plants, the platform changed more than 100 production and management systems and unified 4,000 users in an integrated information platform. The SAP Digital Business Services team assisted in the implementation of the system, while Accenture was the main contractor involved in the project.
The switch to the integrated financial and business management system represents a key stage in Metalloinvest’s digital transformation strategy. SAP S/4HANA is an intelligent ERP system, making it possible to obtain full information on all the Company’s business processes in real time. The decision to use it reflects all the trends of Industry 4.0: hyperconnectivity, the opportunity to work with In-memory technology and the ability to see large amounts of data in real time, enabling the implementation of the Real Time Enterprise concept. S/4HANA is one of the fastest and most adaptable enterprise support and development systems, due to its combination of all available technologies.
Metalloinvest’s main aims in implementing the project are improving business-process efficiency, increasing the accuracy of planning and reducing expenditures.
The integrated financial and business management system will enable Metalloinvest to reduce its operational costs, increase the reliability and speed of processing information for decision-making, and control transaction margins and purchase costs. A reduction in equipment downtime, an increase in stock turnover and the comprehensive monitoring of warehouse stores is planned at a production level.
During the IT project, more than 3,000 organisational changes have taken place. 18 departments have been transformed, with a restructuring of maintenance, purchases and sales, processing and logistics processes.
Andrey Varichev, CEO, Management Company Metalloinvest, said: “The integrated financial and business management system aims to fundamentally restructure Metalloinvest’s production and business processes based on the principles of Industry 4.0. Implementing the digital transformation programme enables the Company to increase its efficiency, leadership and competitiveness, making Metalloinvest more adaptable and capable of withstanding changes in the market.”
Natalia Parmenova, Executive Director, SAP CIS, commented: “Gone are the days when business transformation was implemented through isolated processes. Today, the trend is to introduce intelligent ERP systems, which will then lead to “intelligent production”. SAP S/4HANA will significantly simplify data processing and improve user interfaces. The Company will be able to easily gain an overview of business processes and implement new ones, enabling it to confidently transition to becoming an intelligent enterprise and use all the benefits of digitalisation at management and production levels.”
Maria Grigorieva, Managing Director, Head of Technology, Digital and Operations at Accenture Russia, noted: "The launch of the S/4HANA system at Metalloinvest is the first time the platform has been implemented at a company of this size in Russia. The collaborative work of a large project team, including company representatives, JSA staff, consultants from Accenture, EVOLA, SAPRUN, and the use of Accenture’s methodology for the implementation of major transformation projects, ensured that the project was completed professionally, within the target timeframe and budget. We are confident that the effective introduction of this new technology will lay the foundation for the successful transformation of Metalloinvest’s business and its future growth."
The integrated financial and business management system is a key element in the Industry 4.0 comprehensive business transformation programme, launched by Metalloinvest in 2016. As part of the programme, a multifunctional Shared Services Centre (MF SSC) has also been created, centralising finance and accounting, HR management, treasury functions, centralised procurement and other services.
Metalloinvest plans to invest more than 3 billion roubles in projects relating to the implementation of the integrated management system in 2018.
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