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Malam implements SAP at Diplomat
About the Company
Diplomat is Israel’s leading marketing and distribution company for fast moving consumer goods, personal care products, food products, toiletries and cosmetics.
Since 1968, the company has exclusively marketed and distributed an impressive portfolio of international and domestic brands. As the importer of Proctor & Gamble, the leading manufacturer of consumer goods worldwide and many other leading brands, Diplomat’s presence on the store shelves is substantial.
The main facet of clients such as Diplomat is the business dynamics and creativity that they express in constantly developing additional areas of operation while exploiting their cutting-edge logistics infrastructure and position in the market. An explicit example of this is Diplomat’s operation as a provider of logistics services (packaging, storage, distribution …) for Materna and other manufacturers, while developing service packages tailored to the exclusive needs of each client.
Diplomat’s constant drive for excellence and serviceability in its extensive range of operations has in fact generated a challenging reality, especially for the off-the-shelf solution vendors of systems such as (ERP) organizational management systems, who competed to replace the organization's current information system infrastructure. At the end of the day, Diplomat chose to implement SAP’s solution and Malam as the implementing contractor.
The Solution
The solution that Malam adapted for Diplomat is based on the most sophisticated version (ECC6.0) of SAP’s ERP package combined with SAP’s BI solution and Micronet’s solution for management of the hand-held on-line data terminals used by distributors and sales reps. The application covers almost all of the modules in the package while focusing on the warehouse and distribution management (WMS) module:
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SD – sales distribution management |
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MM – procurement and inventory management |
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WM – warehouse management |
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PP – production management (supporting added value services) |
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HR – human resource management |
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CS – customer service management |
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WF – work flow management |
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External accounting – GL general ledger, AR accounts receivable, AP accounts payable, AA asset accounting |
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CO – costing, budget management and profitability analysis |
Application Project
In order to meet the project’s grueling deadlines (10 months), we adopted state-of-the-art tools and methodologies designed, among others, to minimize risks.
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At the characterization (BP) stage, which has been successfully completed, ARIS BPM tools were used with emphasis on the solution’s processes aspect. The combination of the tools in the BBP process facilitated the focus on processes and the creation of a friendly environment for the client to make decisions relating to the application method for any scenario. Of course, the discussions were held by maintaining end-to-end processes for every possible scenario. |
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Throughout the entire project, the outcome was documented on the client’s organizational portal. In this way, total transparency relating to the project implementation, conclusions of discussions, decisions and their application was assured. Everyone can and is entitled to see the project files and comment on them, within a set time limit. The Diplomat staff is an integral part of and partner to the project |
Simultaneous to the ERP project, several other projects that the companies had to deal with were implemented at Diplomat.
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Diplomat is currently integrating Gillette operations which were reassigned from Schestowitz cosmetic company |
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The construction of a new large warehouse required characterization and integration into the new operating system solutions, which would ensure efficiency by dividing the load between the two facilities |
In addition, we reexamined the business processes and work procedures which ruined the operational efficiency and proposed new solutions for basic matters such as the need for single value identification of all the items distributed by the company, together with their standard packaging and including the use of standard barcodes.
Business Advantages
Alon Zaraff, Information Systems Manager at Diplomat:
"Diplomat’s recent growth has been substantial. The company perceives its information systems as part of its strategic assets. With the growth, the need has arisen for an overall upgrade of the company’s information systems. We chose the SAP system because it improves the company’s achievements through efficient operation of the business processes and gives Diplomat a significant competitive edge, especially in the long term. Diplomat chose Malam because of its proven record in managing complex projects and the highly-skilled human resources that Malam brings to the project and its ability to provide a comprehensive solution for all of Diplomat’s needs. Diplomat’s application method, consistent with its business processes, is to be implemented at every stage of the project including training, authorization and acceptance testing. This method ensures the solution’s comprehensiveness and integratability and serves as a basis for the language shared by Malam and Diplomat personnel.
Baruch Rothschild, Partner and Director of the project supervisor, Seker Management Consulting Company, expands:
“The challenge in implementing a joint project with the technology supplier and the client’s business representatives is to create a uniform language for the business reps to use among themselves and between them and the supplier. This challenge was tested during the CRP presentations, at the end of which Diplomat’s representatives stressed the fact that the scenarios presented to them do in fact reflect the needs and earlier discussions, and that the supplier indeed understood and presented processes which address these needs in the system.
From my vast experience in numerous projects I don’t recall such positive feedback on this matter as we heard from Diplomat.
This outcome was achieved by amending the work processes and adapting them to fit the options available in the system, with the aim of minimizing the scope of the development. By including the BPM methodology during the discussions and presentations a language shared by the technology representatives and the Diplomat representatives was created. The know-how gathered for the BPM system will later serve all elements involved in the project, including the testing and training staff and the workers who will analyze the amendments against the existing situation and will prepare for them by implementing changes in the work procedures, among others”.
The Director of Malam’s SAP Division, Vardit Vazner states that:
“The SAP Division at Malam specializes in the distribution and logistics industry, including the application of the WM module. Application of this solution replaces the older DC Master solution, facilitating the highest level of warehouse management. In the Diplomat project, Malam uses a different application method by combining BPM tools (ARIS) with Solution Manager. We implemented this project by a process assimilation method and not by the modular method, with the aim of generating maximum integration during the initial stages of the project, in other words, as early as the characterization stage. Malam has assigned all of its experience and professional know-how for the optimal implementation of this project. Our aim is to implement the project to the client’s absolute satisfaction while maintaining the highest level of professionalism, and strictly meeting the deadlines and adhering to the client’s budget”.
Malam’s project manager, Itzik Gini:
"We have implemented the application at Diplomat by using the new scenario management methodology that is currently gaining enthusiastic acceptance worldwide. The ERP systems boast process efficiency and lower costs for the client, which is expressed as early as the system application stage, by the fact that the project is documented and managed by Solution Manager and ARIS with full transparency opposite the client, for performing tasks concluded in discussions and documenting customization. We transferred a CRP series as part of the methodology and the client’s positive feedback proved that this methodology will soon replace project management as it is performed today”.
Malam’s SAP Division heads ERP projects from beginning to end, by combining know-how and integration allowing maximum effectiveness. The key area on which the Division focuses is the implementation of projects by combining Solution Manager tools with the ARIS BPM. The Division is currently growing and has recently implemented large-scale projects such as Ha’argaz and Albaad.
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