KEBA Discovers More Efficiency with Automation

Profile

KEBA AG is an international company which develops and produces solutions for industrial, banking, services and energy automation. The Austrian company was founded in 1968 and is privately owned. 80 % of its annual turnover of € 189.5 million is earned abroad. The KEBA Group is headquartered in Linz, Austria, and is represented by subsidiaries in China, Germany, Italy, Japan, the Netherlands, Romania, South Korea, Taiwan, the Czech Republic, Turkey and the US.

KEBA, the technology experts for automation solutions, have been developing and producing innovative, high-quality total solutions for industrial, banking, services, and energy automation for over 40 years. In implementing a SRM platform, KEBA placed emphasis on automation, reducing process costs, and relieving the burden on strategic procurement.

Worker holding tablet inside factory

“Our first milestone was the introduction of Purchase Order Management because we could quickly achieve the greatest ROI here. Around 45,000 of about 70,000 award confirmations are now automatically checked. This saves processing time and costs and gave us space in our budget to introduce further modules.”

Michael Bodingbauer,

Head of Strategic Purchasing Manager,

KEBA AG

The Challenge

From the beginning, it was KEBA’s vision to be able to electronically display the entire procurement process – from registering new suppliers, through requesting offers and ordering, to rating suppliers. KEBA started working with JAGGAER in 2014. The focus of the project was automating and supporting core processes with a single solution. For example, award confirmations had been checked manually until this point. Award confirmations amount to around 70,000 per year at KEBA. The costs of processing these were enormous. The desire for electronic process support to stay competitive was therefore a logical step.

The Solution

The course for growth being followed by KEBA and the development of new markets mean that the procurement department has no time follow up award confirmations and deadlines manually. The process steps needed to be slimmed down and automated. Lead times needed to be shortened.

KEBA found the right partner for supplier management and procurement optimization with JAGGAER in September 2014. The supplier management portal is now the central platform for communication between KEBA and its suppliers. The overview of all activities in the SRM portal makes monitoring deadlines and completed activities easier.

KEBA‘s procurement spectrum is very broad – from resistors to bank vaults. KEBA has a total of 130 categories, divided between 16 strategic buyers in three procurement teams: electronics, mechanics & system components, and sourcing & services. The technology company started with the Purchase Order Management module because the ordering and award confirmation process has the greatest optimization potential due to the high number of transactions. A ROI is being quickly achieved. Previously, award confirmations at KEBA were checked and processed 100% manually. 90 % of these confirmations did not actually need to be manually checked because they did not contain any irregularities. 40,000 order items per year amounts to around 70,000 award confirmations, 65 % of which are now recorded and processed electronically in JAGGAER. This will increase to 80% by the end of the project. Only award confirmations that differ from the order have to be manually processed by the responsible buyer. All other confirmations are sent to the main SAP system automatically. Award confirmations are particularly important to KEBA because they are the basis for their entire manufacturing scheduling. Reducing potential sources of error is also improving process quality.

KEBA is introducing the registration module and the supplier database from the comprehensive SRM suite so that expanded, complete supplier master data is available in a structured system in JAGGAER. New suppliers register only in the supplier portal. Supplier qualification begins early and KEBA can achieve a broader supplier base for its sourcing activities.

KEBA now uses JAGGAER eProcurement for around 5,000 order items a year. The module covers the entire procure-to-pay process electronically. Ordering and approval processes for non-serial materials and investments have been made faster by making internal and external catalogs available. In the future, all employees will use the same process: a shopping cart for catalog articles and free text requests for indirect needs can be generated and transferred into an order. This shortens lead times enormously. Requests under 50 euros now take only one minute to arrive at the supplier. Previously, this often took several days. The necessary approval processes for this are directed over flexible workflows which pull all the relevant departments into the process.

KEBA requests and receives offers using the RFQ module. The standardized process ensures transparency and traceability throughout the whole request process. Efficient processes and easier comparability of offers is improving KEBA’s negotiation position.

As well as a rapid reduction in costs, the deployment of a new e-solution is helping KEBA to achieve a sustainable increase in value because buyers can now devote more time to strategic issues. Partnerships with suppliers are also improved by using the SRM platform. This is leading to long-term savings. The successful introduction and implementation of the entire optimization project can be attributed to clearly defined procurement processes at KEBA and high acceptance by everyone involved.

Goals Reached with JAGGAER

  • Overview of supplier communication and activities at all times
  • Increased quality of supplier primary data using supplier self-registration
  • Efficient processing of orders and award confirmations
  • Shorter lead times and workflow-driven approval processes for procurement using eProcurement
  • A better negotiation position due to efficiency in processes and easier comparability of offers
  • Transparency and traceability in the request process
manufacturing