Sarah Z. Sleeper - Writer

Sarah Z. Sleeper
SAP INFO
October 31, 2007

Before construction begins, Steelscape makes sure building materials are durable and beautiful. To do so, it relies on integrated SAP applications for business processes that benefit both Steelscape and its customers.

The condominiums downtown. The elementary school down the street. New buildings are popping up all over, keeping designers, manufacturers, and contractors hard at work. Before construction starts, one company works to ensure that the raw material for those buildings is both beautiful and offers superior function and durability.

Steelscape produces cold-rolled, metallic-coated, and custom-painted steel coils used to construct a vast array of buildings, from warehouses to family homes. Its products are custom-made to meet the thickness, width, grade and weight requirements of its U.S. and Canadian customers. From the uniquely named Z-Nal and TruZinc to ReziBond, Steelscape products are stronger than galvanized steel while being more formable and more attractive than rivals’ products, offering superior quality and performance.

Cutting-edge technology is part of what distinguishes this innovative company. Steelscape’s business processes – including manufacturing, financial, sales, production scheduling, shipping, purchasing, and other key systems – are powered by SAP software. Because its core processes are integrated, its customers can count on short lead times and excellent product consistency. Likewise, its SAP-based systems generate a spate of advantages for Steelscape itself.

Quantifiable benefits
“We have one technology company-wide. SAP helps us boost financial systems and streamline key processes. Also, because we have few data inconsistencies and errors, our IT staff can focus on value-add activities,” says Hector Marquez, Steelscape’s business systems manager.

An SAP customer since the 1990s, Steelscape has expanded its SAP footprint over the years. In 2001, Steelscape deployed SAP R/​3 (functionality now available in the SAP ERP applications) and, later, the SAP NetWeaver Business Intelligence (SAP NetWeaver BI) component. It also added SAP Solution Manager. As Steelscape’s use of SAP grew, so did its business benefits.

At first, it ran only its financial systems with SAP, but today, 80 percent of Steelscape’s business processes are SAP-based. “We totally improved finance with SAP, and then we optimized the majority of the business,” Marquez says.

The results are measurable. Financial processes are more efficient, accurate, and transparent than previously. Steelscape cut the time to perform month-end closing by 50 percent. It also cut financial audit time by 30–50 percent.

Reporting processes are also faster and smoother. Report generation time dropped by 40 percent, which has enable sales staff and others to perform more timely data analysis. That, in turn, helps staff to better respond to fast-changing customer demand and to do more accurate forecasting.

Smooth transition during acquisitions
An innovative and growing company, Steelscape has both made acquisitions and been acquired over the years. Acquired in 2000 by Mexico’s Grupo IMSA, Steelscape was easily integrated into the parent because both ran SAP.

In 2002, Kalama, Washington-based Steelscape added a new California facility, the third of its four strategically located operations. That acquisition, which took place before the expansion of its SAP footprint, required 600 hours of development time. Conversely, when it acquired its Fairfield, Alabama, facility in 2005, it got that location up and running in just 60 hours of development time. That’s a 90 percent improvement – directly related to its SAP integration.

Steelscape is now in the midst of another acquisition. In July 2007, it was sold by Grupo IMSA to Organización Techint, an Argentina-based group. Marquez expects another smooth technology transition because the new parent, just like the old parent, uses SAP software.

“It’s been easier to communicate and share information because we both have SAP. There hasn’t had to be any explaining about our technology backbone and why we selected it,” Marquez says. “Having SAP has been a benefit during acquisitions.”

Talent on the Steelscape team
Steelscape had integration help from SAP Consulting and Systech Integrators. Its project team relied on SAP’s ASAP methodology, which includes tools, documentation, and templates to manage important factors such as scope, time, and cost. Marquez says ASAP helped the team stay on track and finish on time and within budget.

From the start, top executives have shown strong support for SAP at Steelscape. “SAP is a strong, well-placed company. We have peace of mind because we know they won’t go out of business. That helps us feel secure in our long-term planning,” notes Marquez.

High-level support helped build enterprise-wide acceptance of the new systems as they were rolled out. As redundant and outdated legacy systems were retired and the SAP footprint grew within the company, employees were eager to learn to use SAP and develop new skills.

Steelscape offered several training options to handle change management, while causing little disruption to the business. There was direct training through the SAP Solution Academy, targeting specific applications as needed. And there was cross training, in which Steelscape staff helped each other. For example, when someone became an expert user of the SAP Production Planning component, that person helped train new users, devoting three or four hours a week to do so.

There has been an interesting side effect of having such a well-trained staff. As they learn SAP skills, some people leave Steelscape for larger companies. At $600 million in revenue and 650 employees, Steelscape is proving an excellent SAP training ground. Marquez says that although he hates to see people leave, he is pleased when they get the opportunity to advance their careers. And because of the high-quality ongoing training programs, Steelscape’s in-house SAP knowledge stays broad and deep enough to handle such transitions with no problem.

As with any implementation, Steelscape’s came with a few challenges. Training required time and effort. And after the 2005 rollout, there was an unexpected delay in stabilizing the system. When the processes went live, it became clear that some interfaces and reporting functionality needed tweaking to best serve users’ needs. That situation taught the project team a good lesson – always include key users in business process definition and decision making.

Now Steelscape is consolidating report generation, which requires relying more heavily on SAP NetWeaver BI. There are about 200 reports in use, for everything from production and shipping schedules to sales forecasts and financial analyses. Sometimes two or more reports must be cross-referenced to get necessary information.

Empowering users
Because most reporting is done directly from SAP R/​3, the process takes a toll on system resources. Users must be limited in creating their own report queries to avoid compromising system performance. Soon, with SAP NetWeaver BI, the processing load will be reallocated, empowering users to create their own custom reports without overtaxing the system.

With SAP NetWeaver BI, staff can access data from all systems and perform advanced data analysis. They can generate exactly the type of reports they need without having to sift through unnecessary data or overload the system. Over time, Marquez says Steelscape may be able to cut reports from 200 to just 60 or 70, which will save time, paper, and money. “Employees will get their information faster because they will be producing it in exactly the way they need it,” he explains.

The next items on the Steelscape agenda are a technical upgrade planned for 2008 and a review of business processes to enable further streamlining. There will also be a revamp of interfaces to take advantage of the Web services capabilities of the SAP NetWeaver technology platform. This could give a boost to Steelscape’s customer extranet system, XtraScape.

Customers use XtraScape to get order-status reports, mill test certificates, product claim reports, inventory reports, invoices, bills of lading, and other key documents and information. Marquez says it is a useful tool that will only get better over time, with stronger collaboration and more functionality. And as if those goals weren’t enough, Steelscape aims to further optimize purchasing processes and gain better budget control.

Such dedication to ongoing improvement is just part of Steelscape’s consistent efforts to squeeze the most possible value from SAP and other IT systems. Just as Steelscape goes to great lengths to ensure only the highest quality, most durable steel coils for its construction industry customers, it works equally hard to bolster its own business processes to create a strong foundation for the future.