Case Study: Global Coffee Distributor Modernizes ERP System And Realizes Solution Vision

Global Coffee Distributor Modernizes ERP System Across The Globe And Realizes Solution Vision With Formal User Adoption “Change Management” Program

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The Client

Headquartered in Italy, Illy Café is a world-renowned coffee brand with global distribution on all five continents, throughout 140 countries, employing 1,200+ people back in the year 2016. Withum served the Illy North America team with operations in U.S., Canada and Mexico and consulted with the parent company for international locations.

The Challenge

The project aimed to gain agreement to a common business operating model with country localization requirements along with a master data redefinition so that the world would have common data definitions in order to speak and act as a global company. The chosen ERP solution is JDE. For some offices across many countries, this project represented an upgrade and for others either a brand new installation or a migration from another ERP solution. For North America operations, the second-largest business unit, this meant moving away from an Oracle ERP solution which was operational for over ten years. The comprehensive implementation scope covers 18 to 24 months and is going to require temporary bridges to the reporting and consolidation solution, Hyperion HFM, to Web Sphere e-Commerce platform and to other potential third-party solutions and business partner relationships.

The Approach And Solution

Withum was selected to lead the User Adoption Program for the coffee brand to support the underlying Organizational Change Management behaviors that would undoubtedly fall onto the Critical Success Path if not addressed with a formalized effort.

Withum’s formal program/approach is intentional and methodical and it starts with the Business Vision. Sure, at the beginning, there was a project kickoff, but the message and “the why” can fade quickly, especially with a long-term project like this one.

The common project change “drivers” were as follows:

International scope
Diverse audiences
Process improvement focus
Business Case Achievement
Multiple concurrent teams operating in varying time zones and languages
Multiple integrations
New data definitions and terminology

Communication must be a constant, and in fact “over communicating” is a good thing in this case. A detailed communication plan was rolled out outlining internal and external impacted parties with tangible and timely messaging via multiple media channels.

In this next step, the Value Realization expected from Business Process Optimization should be vetted vigorously. Not all change leads to positive outcomes. It should be okay to push back and demonstrate practical business acumen. Along the way, in our approach, this step is specifically designed to take stock and determine if the project is on track to accomplish the expected benefit/value. If not, we pause and regroup with leadership to discuss and determine a path forward—no reason to waste our client’s time and investment dollars.

Once we got through the Value Realization discussion, we needed to consider Organizational Alignment changes for the coffee distributor. Shifting job responsibilities to other roles should include updates to job descriptions, performance management processes and other human resource activities.

During any ERP implementation approach, we would be involved with multiple rounds of testing. Consider, the process and tools are changing and now we need people to understand the change. Here is where Withum differs from others and reinforces a specific Job Role Impact Analysis. This stage is indeed a heavy lift, but the outcomes using our tools to capture the impact within the process/sub-process detail yields an outline for our training team to develop the materials, education and supporting efforts.

Many surveys are executed throughout this change management process but one week before go-live and after training has been completed is the Go-Live Readiness Survey. This survey revealed some topics warranting more attention and ultimately changes.

In our User Adoption program, we examine the governance process, which should remain and evolve as the new ERP system for Illy Cafe is used. The team can exhale away a level of intensity built up to get to the go-live, but this new creation needs maintenance and caring to serve its purpose.

The Results, ROI

As a result of the project, Illy saw benefits around:
Material Purchases. Enterprise visibility and leverage of material spend; Supplier rationalization and consolidation; Greater adherence to in-contract spend.
Inventory Reduction. Development of both Enterprise and Business Unit level order fulfillment capability (ATP); Improved order promising and tracking; Potential to increase turns while reducing inventory.
Information Technology. Indirect Labor associated with increased system and data capability; Improved IT support; Reduction in need for ERP specific infrastructure.
Financials. Improved financial close to process; Reduction in manual processing; Shorter order-to-cash cycle time.

In closing, Withum was able to teach the Illy team how to replicate this Change Management/User Adoption program for the next transformational project, big or small. As a result, the company can sustain itself without spending more consulting dollars, which is the nicest compliment we could ever receive.

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