“If we had chosen any other ERP system, we would have needed to build most of the industry-specific functionality that we wanted. But with Microsoft Dynamics AX and To-Increase Food & Beverage together, we gained comprehensive food industry capabilities on a robust ERP platform. We also concluded that this integrated solution would help us realize the process efficiencies that we required to compete more powerfully against cut-price companies with lower quality standards.”
With locations in Dalsjöfors and Gothenburg, Sweden, Dalsjöfors Kött is one of the country’s largest meat processing and production businesses. Dalsjöfors Kött was founded in 1911 and is today owned and operated by the fifth generation of the same family. The company purchases cattle and beef for slaughter exclusively from Swedish farmers. It markets its products under its own brands and also lets customers sell them under theirs. Annual sales are approximately €150 million or US$204.
Following an acquisition, Dalsjöfors Kött sought to combine operations and systems. The two organizations used different business management software tools, and neither of them could become the standard for the entire company. The ERP system in use at Dalsjöfors Kött had been developed in-house over several years and required ongoing adjustments to support the company’s business activities.
Solution with comprehensive industry functionality to run all business activities
Magnus Hagberg, CIO at Dalsjöfors Kött, explains, “We needed a modern ERP system that would enable us to manage all of our processes, including all the complexities that are specific to our industry. In addition to the typical ERP financial and business management capabilities, we required, for example, a solution that would make it possible to run the complex sequence of purchasing animals, processing them into multiple products from the same animal, and distributing these products to customers. We wanted to acquire as much functionality as possible within a standard product, so we could minimize the amount of customizations.”
Hagberg and his team reviewed Microsoft Dynamics AX and several other ERP systems. They decided for Microsoft Dynamics AX because they could deploy it in integration with To-Increase Food & Beverage. “If we had chosen any other ERP system, we would have needed to build most of the industry-specific functionality that we wanted,” explains Hagberg. “But with Microsoft Dynamics AX and To-Increase Food & Beverage together, we gained comprehensive food industry capabilities on a robust ERP platform. We also concluded that this integrated solution would help us realize the process efficiencies that we required to compete more powerfully against cut-price companies with lower quality standards.”
Building a unified organization on a single ERP system
Working with To-Increase partner Tacticus, Dalsjöfors Kött deployed Microsoft Dynamics AX and To-Increase Food & Beverage simultaneously. The implementation completed quickly, in under seven months. The company used To-Increase’s business process management solution, RapidValue, to model and test business processes in the new ERP system. “RapidValue offered a very efficient way to visualize and validate our activities, and helped us ensure that our processes and workflows actually fit our business requirements,” says Hagberg. “It also makes it easy to produce solution and process documentation for employees. We anticipate more work with RapidValue to refine our business roles and make them more effective.”
For Dalsjöfors Kött, running the enlarged company on a single ERP system as soon as possible was a priority. “Our new ERP system has finally enabled us to form a single entity out of two merged companies,” notes Hagberg. Dalsjöfors Kött postponed making full use of the To-Increase industry solution until 2015. Even so, the company already observes significant benefits from its integrated ERP.
Real-time inventory visibility enhances sales
Hagberg says, “Our most notable improvement is that now everybody in the business can see the same, current information from sales, the warehouses, and our finances. Visibility in the warehouse was an issue because our production moves so fast, and sales has to have correct inventory detail or run into problems. Today, the sales team can always verify accurate stock levels from all three warehouses and make reliable delivery commitments to customers. Sales associates, who no longer use several spreadsheets, save much time, and are far more effective in helping customers in a single call.”
Accurate, reliable recording of warehouse transactions
Integration of Microsoft Dynamics AX with Dalsjöfors Kött’s production lines means real-time production data, including the flow from production into the warehouses, is always available in the ERP system. In addition, warehouse workers use To-Increase Data Collection Studio to record transactions on hand-held, bar code-reading devices accurately as they occur. Hagberg explains, “With Data Collection Studio, we avoid the errors that used to happen in picking and inventory management. Before, with the software we had written, workers could scan and pick items repeatedly, and because the tool was not connected to other business systems, it took a while before we noticed mistakes. Today, we have unique barcode IDs on each item, and you can scan it just once. With tracking through the entire production process, we have much better control over what happens to the products.”
Improved financial management and decision-making
Because of the increased transparency in the connected ERP system, Dalsjöfors Kött finance managers can see when orders are picked and shipped, and can invoice promptly. The company used to invoice twice a week at most, but now sends out invoices every day. Instead of sending separate invoices when goods came from different warehouses, it is now easy to generate and forward consolidated invoices. In addition, the new ERP system supports rapid electronic document interchange (EDI), which was not possible before, and can issue invoices in English, a real advantage when Dalsjöfors Kött deals with customers for whom Swedish is not an option.
Financial reporting at Dalsjöfors Kött has also changed for the better. “The IT department used to be very busy with creating reports for managers,” says Hagberg. “We still have standard reports that we produce in Microsoft Dynamics AX and save on a SharePoint site. But, when they need to make a decision, people prefer to run a query in AX and get the input they want, right then.”
Note: We may be talking again with Magnus Hagberg and his colleagues at Dalsjöfors Kött as the company makes more capabilities of To-Increase solutions available to employees and achieves greater efficiencies in production and overall processes.