Frontem

Industry Expertise

We gained special industry insights either by implementing SAP systems or working directly for companies in specific sectors and industries:

We’ve learned the specific business ecosystem, we know the challenges and pain points these industries face, as well as key factors that can drive business success, at least from the SAP part of the equation. The industry specific business process knowledge that Frontem people bring to the table is another key accelerator that contributes to a successful SAP implementation project with us.

We are ready to share these experiences with you, and also able to transpose your particular industry requirements in SAP.

Industrial Engineering, Construction and Defense

Companies in these industries are dealing with high complexity projects, like building and installing power generation plants or repair and overhaul for machinery and equipment: this requires long sales and project execution cycles, smooth coordination of subcontractors, as well as after-sale customer care and maintenance programs. Some common challenges are:

  • Increased financial risks, caused by project delivery delays and cost over-runs due to lax supply-chain integration with vendors and sub-contractors.
  • Long financial closing cycles and poor accuracy caused by the lack of system integration between the work management systems, financial and billing systems.
  • Decreasing customer satisfaction ratings due to lack of proactive measures after-sale for repair and maintenance.

Industry Specific SAP Process modeling knowledge from Frontem:

  • Project planning and execution solution, including operational breakdown to Work Order level
  • Logistic execution and SCM integration: special stocks, purchasing, sub-contracting, external processing
  • Project accounting and work order accounting, with integrated Sales, Billing and Project Profitability Analysis
  • Integrated time collection and approval: from time card to invoice
  • Complex revenue recognition for Long Term Projects: PoC, Milestone delivery, Delivery-related
  • Customer Service: repair and overhaul, spare parts management, equipment installed base monitoring, service orders

top

Process Industries : Beverage, Food Processing, Pharma

Companies in these industries are faced with dynamic market shifts and pressures from consumers, retailers and distributors, as well as increased regulatory requirements in both North America and other countries:

  • Increased regulatory pressure from government agencies (FDA, USDA, Canadian Food Inspection Agency, Health Canada).
  • Stringent requirements for GxP compliance.
  • Cost spiraling caused by product recalls, expired inventories, product contaminations.
  • Generic producers and low cost brands entering their markets.
  • Increasing prices of raw materials in the commodities markets.
  • Changes in consumer behavior and consumption patterns.

Industry Specific SAP Process modeling knowledge from Frontem:

  • Sales and Logistics Execution process models with: suppliers, distribution channels (food service companies, HORECA retail stores, key accounts) and final customers.
  • Direct/ indirect sales models with complex scenarios: rebates, bonuses, coupons; multiple layers of commissions; credits and returned items.
  • Empties management: tracking empties; empties availability; routes determination for pick up.
  • Process manufacturing aspects: expiration date tracking, batch / lot tracking, external processing and co-packing, quality assurance.
  • Complex recipe-based costing models: active-ingredient and batch valuation, multi-level production costing, co-products and by-products, production campaigns, in-house and external processing.
  • Handling industry specific taxes and excise duties.

top

Discrete Manufacturing: Cable, Furniture, Toys

The shift to low-cost labour countries has dramatically changed the business processes for these manufacturers. Beside product innovation and development, the majority of their finished products, components or assemblies could be now tracked to either an off-shore plant or a subcontracting vendor in China. This shift had driven the need to re-vamp supply chain and manufacturing execution processes in order to integrate the global aspects of these transactions and to deal with complex cross-border taxation issues. To stay competitive they need to address similar challenges:

  • Just in time delivery to their customer and retailers. Even short delays can cost them vendor penalties that can transform the orders in money loosing deals.
  • Demand changes fast enough to require flexibility of production lines from a make-to-stock model to make-to-order model.
  • Inventory optimization is now critical for survival, so modern demand forecasting integrated with MRP planning tools are not optional any more.

Industry Specific SAP Process modeling knowledge from Frontem:

  • Cross-border Intercompany business model with stock transfer orders, IC billing and EDI processing for invoices.
  • Logistics execution solution with transportation cost optimization for cross-border shipments.
  • Container and shipment cost planning.
  • Warehouse management and Inventory planning solutions.
  • Cross-Plant and Cross-country Product Costing models.
  • Subcontracting and Co-packing Costing and Logistic execution solutions.

top

Services: Professional Services and Logistics Service Providers

Companies in the professional services sectors or logistics service providers are facing increased demands from their client base, as the latter are handing over critical processes to them. Back office automation is now a key cost improvement factor for professional services firms, as is the supply-chain excellence for companies that handle goods and materials for their clients. Typical pain points that service organization are facing:

  • Long “time-card to cash” cycles caused by disconnected time collection, work management and travel expense systems and billing systems.
  • Accuracy of time data collection and evaluation are critical, as typical service organization have over 70% of the cost base represented by labour.
  • Customer complaints and Receivables disputes caused by billing accuracy issues.
  • Data retention, document imaging and drill down capabilities are critical to improve accuracy and solve disputes.
  • Revenue “ownership” and reporting for cross-border delivery of services for affiliated companies.

Industry Specific SAP Process modeling knowledge from Frontem:

  • Complete project accounting solution: from pre-sales and opportunity to project closure.
  • Integrated travel expense management solution with corporate card automation or optional Employee self service for booking travel.
  • Integrated time entry and approval solution.
  • Automated Resource-related billing or milestone billing.
  • Document imaging for time and expense documents.
  • Workflow solution for T&E approval.
  • Complex revenue recognition solutions: PoC, Milestone, etc.

top

Utilities: Electricity Transmission and Distribution

In the past 10 years we have witnessed a “tidal wave” of deregulation and privatizations in the Electricity transmission and distribution sectors in Canada, US and Eastern Europe. A host of smaller, regional companies are now out of government management and operate as commercial entities. These companies have embarked in productivity improvement initiatives like smart metering, modernization of existing infrastructure, while they are asked to participate in conservation and energy-efficiency initiatives and are challenged to:

  • Efficiently manage investment programs and allocate budgets while maintaining a balance between expansion and maintenance of existing infrastructure.
  • Adopt cost reduction initiatives by consolidating functions in Shared Services centers or outsource certain non-core business functions, while increasing productivity.
  • Ensure uptime and availability to customers with pro-active maintenance programs for the existing infrastructure.
  • Report financial results under various regulatory authorities, countries GAAP and future alignment to IFRS.

Industry Specific SAP Process modeling knowledge from Frontem:

  • Investment management solution, integrated with Project accounting.
  • Complete Asset Accounting solution integrated with operational Enterprise Asset management to enable pro-active maintenance planning and execution.
  • Complex project and work order costing solutions that enable compliance with overhead allocation regulations.
  • Finance and Purchasing Shared Services models.
  • Solutions for financial reporting, compliant with Regulatory, GAAP and future IFRS alignment.

top

Wholesale Distribution / Consumer Packaged Goods

Wholesale distributors are pressured from both their CPG vendors and their re-seller/ retailer bass; their low-margin / high volume businesses models are faced with increased product availability demands at low cost, while the CPG vendors are squeezing credit and margin. By the same token, GPG commercial organizations are seeing tightened controls on their brands marketing and trade promotion budgets while they try to push more innovative products through the channel, to consumers.
Typical pain points that wholesaler / distributors and GPG commercial companies are facing:

  • Re-sellers and retailers are requiring just in time delivery: this leads to over-stocking or product not being available, thus losing sales.
  • For imported goods, currency rates fluctuations are squeezing the low margins, leaving the wholesaler overexposed.
  • Re-sellers, CPG vendors and retailers are increasingly asking for business network integration as value-added services: instant inventory visibility, EDI for invoices and payments, direct-shipments, custom packagings are now common requests.
  • Instant access to profitability analysis information at customer / brand and item level is critical for making quick decisions in the market.
  • Tightened controls on marketing spend, trade promotion and consumer or re-seller incentives.

Industry Specific SAP Process modeling knowledge from Frontem:

  • Product and Brand Profitability Analysis Reporting by various Sales Channels up to the Customer Account level.
  • Project Budgeting and Actual reporting for brand marketing and trade promotion spend, integrated into Profitability analysis, for full PL visibility at Brand, Product hierarchy level.
  • Material ledger scenarios: inventory valuation in foreign currencies.
  • Supplier / Customer / Retail integration with EDI scenarios.