Maple Leaf Foods gets business process makeover

Maple Leaf Foods Inc. will undergo an enterprise resource planning (ERP) deployment with SAP Canada Inc. that should give an integrated and comprehensive view of the business thereby preventing a potential recurrence of issues like the Listeria outbreak of last fall, the chief information officer said.

According to CIO Ray Shei, the Listeria outbreak originally had no bearing on the Toronto-based food-processing company’s decision to implement SAP, a discussion that had begun since last August, but the technology should nonetheless offer some opportunities for improving the business. “Any time you can get an integrated view of your company – SAP has some offerings that we should take advantage of – that can help us,” said Shei.

Once core SAP modules are in place, Shei said the company “should take a look at other opportunities within the SAP functionality that should address some of that.” Product lifecycle management, for instance, is one such opportunity, he said.

Maple Leaf Foods will deploy SAP ERP products to improve core processes like financials, sales, human resources, and manufacturing – starting with the implementation of financials modules in January. It will also deploy SAP for Consumer Products, a set of applications with industry-specific functionalities and best practices. And, business intelligence tools from the SAP BusinessObjects portfolio to render business performance monitoring and visibility.

Prior to this, Shei said Maple Leaf Foods had legacy systems, “a mini version of an ERP,” from the mid-80s. “I don’t know if there were issues (with the legacy systems), as much as we wanted to have one fully integrated ERP instance,” he said. Similarly, replacing the business analytic tools from Ottawa-based Cognos Inc. was SAP BusinessObjects “fits within the fully-integrated solution that we’re trying to go to.”

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The food processing industry-specific tools and best practices will help Maple Leaf Foods become more demand-driven, “so they understand the needs of the customers more clearly, and can produce products and services in a more timely fashion,” said Mark Aboud, president and managing director with Toronto-based SAP Canada.

As well, benefits include operational cost reduction as a result of greater efficiency, and adherence to regulatory compliance requirements.

The business analytics capabilities from SAP “(give) the executive the ability to have visibility into the information about their business, gives them improved transparency,” said Aboud. “They can monitor their business, make decisions about where they might spot inefficiencies, or spot emerging trends in their strategy so that they can leverage growth opportunities.”

The base platform of core ERP products gives efficiency, while the analytics portion gives business visibility, explained Aboud.

It’s important to have good core operational performance to understand and track the business, said George Goodall, senior research analyst with London, Ont.-based Info-Tech Research Group Ltd. “When you look at the Listeria outbreak, or any kind of quality problem, that certainly does indicate some breakdown in process,” said Goodall, adding that ERP provides much-needed technology controls for enforcing policy and enabling better access to data.

When in a good economy, companies might be entertaining new opportunities, Goodall has observed many companies currently challenged by limitations in capital investitures. “But we are seeing a lot who are taking this opportunity to re-trench and re-focus on core business process and address the question, ‘What do we actually do?’”

And, that, said Goodall, is driving a lot of interest in ERP investments.

Maple Leaf Foods will continue the deployment in a phased approach, with an estimated completion time of 36 to 40 months, said Shei.

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