HEINEKEN International: Winning Efficiencies Through a Cross-Continent Data Migration

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1 Picture Credit HEINEKEN, Amsterdam, The Netherlands. Used with permission. SAP Customer Success Story Consumer Products HEINEKEN HEINEKEN International: Winning Efficiencies Through a Cross-Continent Data Migration

2 HEINEKEN International Industry Consumer products beverage companies Products and Services Beer, including Amstel, Birra Moretti, Cruzcampo, Dos Equis, Foster s, and Kingfisher product lines Web Site SAP s Services of the System Landscape Optimization group from SAP, SAP MaxAttention support Partners SAP Services organization, Wipro, T-Systems International GmbH, and Hewlett-Packard When HEINEKEN International acquired the beer division of FEMSA in Mexico and Brazil, the company s IT department faced a huge challenge. A terabyte of data had to be safely migrated from FEMSA s SAP ERP application in Mexico to HEINEKEN s SAP ERP application system landscape in Germany all over a single weekend. To help ensure success, HEINEKEN turned to the System Landscape Optimization group at SAP. 2

com SAP s Services of the System Landscape Optimization group from SAP, SAP MaxAttention support Partners SAP Services organization, Wipro, T-Systems International GmbH, and Hewlett-Packard When

3 A giant among breweries HEINEKEN is a proud, independent global brewer committed to surprising and pleasing consumers with its brands and products. The brand that bears the founder s family name HEINEKEN is available in almost every country on the globe and is the world s most valuable international premium beer brand. The company s goal is to be a leading brewer in each of the markets in which it operates and to offer one of the world s most diversified brand portfolios. We re present in over 70 countries and operate more than 140 breweries that produce 214 million hectoliters of beer sold, says Lee Dawson, senior vice president of business process and technology for the Americas division of HEINEKEN. Currently, HEINEKEN is Europe s largest brewer and the world s third largest by volume. HEINEKEN is committed to the responsible marketing and consumption of its more than 200 international premium, regional, local, and specialty beers and ciders. These include Amstel, Birra Moretti, Cruzcampo, Desperados, Dos Equis, Foster s, HEINEKEN, Newcastle Brown Ale, Ochota, Primus, Sagres, Sol, Star, Strongbow, Tecate, and Zywiec. Its leading joint-venture brands include Cristal, Kingfisher, Tiger, and Anchor. In 2011 the company generated 17.1 billion in revenue and employed 70,000 people worldwide. The HEINEKEN brand itself is available in almost every country around the world. Lee Dawson, Senior Vice President, Business Process and Technology, Americas, HEINEKEN International 3

4 Investing in Latin America through a strategic acquisition When HEINEKEN acquired the beer division of FEMSA in Mexico and Brazil, it became a more competitive player in Latin America one of the world s most profitable and fastest-growing beer markets. We wanted to build more strength in the Americas in particular, Mexico and Brazil, two of the largest beer markets in the world, notes Dawson. Our deal with FEMSA enabled us to accelerate execution of our strategy. But first, FEMSA s beer business had to be integrated into HEINEKEN s systems and processes. It quickly became clear to the integration program office that we needed to have governance and autonomy to move the business forward, says Dawson. Without this, we couldn t implement our own commercial reporting, ordering, and production systems; financial reporting; and much more. Control and information about the business was limited, to say the least. Technically, this meant HEINEKEN needed to transfer data related to the beer business from FEMSA s 41-terabyte SAP business application located in Mexico to a newly created SAP ERP application system based in Frankfurt, Germany. Altogether, approximately 1 terabyte of business data had to be moved internationally to the German environment. We also needed to carve out business data belonging to FEMSA s business intelligence system and archives, notes Dawson. The challenge was to safely migrate the massive amount of data represented by four company codes with a minimal impact on regular business operations. For help, HEINEKEN turned to SAP. 4

Our deal with FEMSA enabled us to accelerate execution of our strategy. But first, FEMSA s beer business had to be integrated into HEINEKEN s systems and processes.

5 Choosing the right partner for a high-risk project To help ensure success, HEINEKEN chose to leverage the services of the System Landscape Optimization group at SAP. The group helps companies strategically consolidate, align, harmonize, and optimize IT systems after reorganizations, acquisitions, and mergers. As a long-term SAP customer, HEINEKEN had a strong relationship with the company. But it chose SAP because of its proven technology and standardized approach to managing a complex project that required splitting and transforming data, as well as its extensive know-how regarding system landscape optimization. By tapping SAP global resources, tools, and best practices, we were confident that we d have the process continuity and data consistency we needed after the data transfer. Lee Dawson, Senior Vice President, Business Process and Technology, Americas, HEINEKEN International 5

As a long-term SAP customer, HEINEKEN had a strong relationship with the company.

6 A massive, international migration in just one weekend The main challenge was to tackle the overall separation effort. Global-scale IT projects are a little like an iceberg: the visible tip above the water represents the changes to the user experience, but the real work lies in the kilometers of ice hidden below the surface, says Dawson, who was part of the intercontinental team that successfully completed the project. It was the largest project of its kind ever undertaken. The project was completed within the agreed 36 hours despite the different time zones and languages involved. What made this possible? Quick responses, a shared mind set among all parties involved, clear deadlines, and detailed planning and execution. The international teams worked extremely well with SAP consultants across the globe, leveraging everyone s respective skills to help ensure success. Team members included a total of 140 people who came from FEMSA, HEINEKEN, 36 hours Time to complete cutover the System Landscape Optimization group from SAP, Wipro, Hewlett-Packard, T-Systems International GmbH, and SAP MaxAttention support. We were often working across five or six countries in Spanish, Portuguese, English, German, Indian, and Dutch, explains Dawson. If people hadn t been so proactive and collaborative, we could have lost 12 to 14 hours, resulting in unacceptable downtime for HEINEKEN. 6

surface, says Dawson, who was part of the intercontinental team that successfully completed the project. It was the largest project of its kind ever undertaken.

7 A stable, reliable system from day one The project timeline for the migration was extremely aggressive, says Jen Singer, integration program manager at HEINEKEN. The pressure was really on, but we did it on time, within budget, and with no business interruption. Following the migration, HEINEKEN had a complete, harmonized copy of FEMSA s data. There was very little impact on normal business operations for either company, and management was extremely pleased to see that employees had immediate access to SAP ERP right after the new system went live. From an end-user perspective, the migration was completely transparent. FEMSA s people used HEINEKEN s SAP ERP functionality from day one without incident; the only difference they noticed was faster performance. Comments Dawson, In Mexico, we had 6 or 7 calls to the help desk on the first day after going live and around 10 in Brazil and most of these were password resets. It was so quiet that at one point we were checking whether there was a problem with the phones! The stability and reliability of the new SAP ERP application immediately after going live was praised by both the business-user community and HEINEKEN s senior leadership. Lee Dawson, Senior Vice President, Business Process and Technology, Americas, HEINEKEN International 7

There was very little impact on normal business operations for either company, and management was extremely pleased to see that employees had immediate access to SAP ERP right after the new system

8 On time, within budget, and without business disruption HEINEKEN was extremely satisfied with the results and overall service quality delivered under the leadership of the System Landscape Optimization group. That weekend showed us the real added value of having chosen SAP as our premium partner in this enormous challenge, says Hector Calva, CIO of Coca Cola FEMSA. Adds Dawson, We especially liked the fact that several complex elements, such as the beverage industry solution and country specifics for Brazil s nota fiscal, were handled with great ease by the SAP team. Now HEINEKEN has complete governance over FEMSA s beer-related operations and data. With full control over the infrastructure and data, we can make changes to the business as needed so that it s aligned with HEINEKEN s strategy and processes. This was the ultimate goal, explains Dawson. We committed to integrating these businesses, and that s exactly what we ve done. To the outside world, particularly for investors and shareholders, it was important that we complete the migrations on time and within budget. With this smooth transition following the announcement of our deal with FEMSA, we sent a powerful message about our professionalism as a company. Lee Dawson, Senior Vice President, Business Process and Technology, Americas, HEINEKEN International 8

Adds Dawson, We especially liked the fact that several complex elements, such as the beverage industry solution and country specifics for Brazil s nota fiscal, were handled with great ease by the SAP

9 HEINEKEN CMP17020 (12/06) Copyright/Trademark Privacy Impressum Taking integration to the next level This was one of our largest and most complex project challenges, explains Singer. We delivered the new solution in a controlled and predictable way, providing a sustainable operational solution that went live seamlessly and without impact to our business operations. HEINEKEN is currently in the process of converting FEMSA s chart of accounts and standardizing reporting so that it complies with the HEINEKEN standards. This will enable management to receive more transparent business figures via automated, consolidated reporting. From a business perspective, this project could be described as open heart surgery. We are glad to say the patient is alive and performing very well. Lee Dawson, Senior Vice President, Business Process and Technology, Americas, HEINEKEN International 9 Picture Credit HEINEKEN, Amsterdam, The Netherlands. Used with permission.

HEINEKEN is currently in the process of converting FEMSA s chart of accounts and standardizing reporting so that it complies with the HEINEKEN standards.

HEINEKEN has once again demonstrated its ability to deliver a positive financial performance despite the challenging economic environment.

HEINEKEN has once again demonstrated its ability to deliver a positive financial performance despite the challenging economic environment. Overview The Quick Read Performance highlights 17,123 million Revenue +6.1% 2,697 million EBIT (beia) +2.8% 1,584 million Net profit (beia) +8.8% 164.6 million hectolitres Consolidated beer volume +12.8%