Tetley brews SAP savings via in-house management

Tetley Tea's IT team will go live this month with the first module of an SAP upgrade that the company expects will be completed at about half the cost of using external suppliers.

Tetley Tea's IT team will go live this month with the first module of an SAP upgrade that the company expects will be completed at about half the cost of using external suppliers.

The company has just completed an upgrade from R/3 to SAP ERP Central Component 5 to support the roll-out of new SAP modules to its business worldwide from a hub in the UK. SAP Business Warehouse is the first application to be rolled out, and should go live within three weeks.

Paul Kay, Tetley's group business systems manager, said a 20-strong internal IT team would project manage the overhaul with only selective use of consultancy expertise.

"We were looking at about £4m for the total SAP roadmap. I think we can do it at 40%-50% of that by using our own project management to take out a huge chunk of the cost."

Tetley decided it needed the SAP upgrade in order to support a corporate goal of doubling the size of the business within five years, Kay said.

Having anticipated that much of the growth will come through acquisition, Tetley wanted a UK-based central enterprise resource planning hub so that any newly merged businesses could quickly deploy standardised business processes and take advantage of the global business and IT systems.

Kay said the business process overhaul had required high-level support from the outset. The IT department started with reporting definitions necessary to make SAP Business Warehouse useful in strategic planning.

"I saw it as essential to have common reporting definitions. We worked with the commercial insight team with the sponsorship of the managing director for the commercial business.

"That was important because without his support it is difficult to get agreement. But if he says, 'that is the way we are going to do it', then he is going to be able to make sure everyone is aligned with that."

Tetley has so far spent £100,000 on upgrading to SAP Central Component by adopting a selective use of consultancy firm Diagonal Consulting.

During the IT boom, consultants were only interested in block bookings, Kay said. "Now I think if they are on a day rate we should be able to turn them off. I think they are coming round to our way of thinking - to work a day here and two days there."




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