Westernacher

Group Costing & Profitability

Globalization, cross-border sourcing combined with ever-increasing costs and demanding customer service levels call for increased integration of the value and supply chains with low-cost providers for greater end-to-end process control. In order to manage the cost and quality of these global supply and value chains, companies must have precise cost and profitability data for each product and process, ranging from profit centers, business areas, divisions, legal entities and sometimes even across affiliates such as venture partners and supply networks.

Many companies overcome the challenge of extended supply chain planning with the implementation of enterprise-wide demand-and-supply planning systems (such as SAP APO) that connect to other internal and external operational systems, whether SAP or non-SAP. However, interfacing with multiple clients and cost structures within the current SAP environment, significantly constrains enterprise costing and value chain planning.

Companies wishing to get accurate data for their global value chain across national and enterprise boundaries are faced with the issue that their systems lack the capability to provide detailed and accurate profitability, COGS and company margins by product and customer across these various dimensions. This predicament is often overcome with a myriad of Excel spreadsheets and/or complicated custom applications and interfaces.

In order to create the transparency necessary to manage global supply and value chains successfully, the entire value chain must be modeled on one system and provide functionality for the handling of local, historic and group currencies, inter-company profits, ability to retain the cost component split throughout the value chain - even when legal entities and countries change, as well as simulation capabilities. These requirements are not sufficiently met by the standard software solutions currently available on the market.

How Westernacher Can Help

Westernacher has developed a unique approach to enable group costing and profitability analysis across system and enterprise boundaries using a GCP Engine. This engine enables detailed analysis of group earnings, both ex ante and ex post, and is equipped with standard interfaces to SAP R/3. The GCP component unburdens legacy (transactional) systems from permanent currency conversions and activities designated for the group, while also ridding companies of myriad spreadsheets currently used to perform group costing, planning and profitability analysis.

Our solution helps companies to:

• Accelerate and automate the planning cycle
• Increase cycles for forecasts and rolling planning
• Capture accumulated inter-company profit(s) by market
• Capture results by product and by customer in local view as well as in group view
• Calculate and simulate cross-company value chains
• Interface with any ERP, APS or BI system

Why Westernacher?

With our extensive experience in implementing and optimizing ERP systems, detailed know how in supply and value chain planning as well as our knowledge of your industry, we are uniquely positioned to help you get a clear view of your value chain. Using our group costing and profitability approach, we have already enabled major players in the chemical and engineering industries to gain complete insight into their COGS and product profitability across group, system and national boundaries.

Benefits of our custom GCP solution:

• Consistent cost and profitability view across the extended enterprise – across national and system boundaries
• Enables integrated planning of the entire value chain from demand and supply to sales, cost and production planning along with powerful alert monitoring in case of planning inconsistencies and data violation
• Supports the management of large corporations in setting quantitative goals for each entity
• Enables risk analysis based on simulations
• Based on well-established technologies which can easily be deployed and maintained internally and externally