Owned by Axel Johnson International AB and part of the Axel Johnson Group, AxFlow is Europe’s leading supplier of so-called flow management, or pumps and systems that equip processing industries, including food, pharmaceuticals, chemicals and petroleum. The company warehouses more than 30,000 items, is established in 16 European countries and has nearly 400 employees.
AxFlow delivers systems that manage fluids for high-precision laboratories as well as bulk material handling of hazardous chemicals, and the company’s technical specialists and engineers customize solutions for the special requirements of various industries. The company’s pumping systems enable juices, milk, medicines, chemicals and other liquids to travel far and maintain quality.
Common IT infrastructure
AxFlow has broad market coverage in Europe, but synergies between the different companies had never been optimal. Each company has acted independently within its respective market: this has created local strength, but the potential of the group dynamic was not developed to its highest possible degree. For AxFlow’s management, this was one of the prime forces for the further development of the company.
”A number of factors caused us to examine our IT infrastructure, but above all, it was because we wanted to develop as a Group and take advantage of our common opportunities, not just the potential of individual units,” says Ole Weiner, CFO at AxFlow. Axflow’s current success is outstanding, and the possibilities are even greater with improved cooperation.
Growing internationalization, not only for AxFlow but also its customers, will place additional demands on supply chain visibility, both for the Group’s sales staff as well as from a logistics management standpoint. Customers are operating less on a local level and more from a global or pan-European perspective. AxFlow salespeople need visibility and transparency to support customers as effectively as possible.
Four years ago, AxFlow initiated its purchase of an ERP solution, a process in which several of the largest solution providers participated. AxFlow focused its ERP system requirements on synergy between the various companies in the Group, the need to support e-business solutions for suppliers, and logistics management.
AxFlow selected IBS for several reasons, including experience with ERP software for mid-sized and international businesses. Foremost, however, was the IBS competence within Supply Chain Management, along with knowledge of technology and equipment within the industrial machinery and equipment industry.
IBS signed an agreement in 2002 with AxFlow, which spelled out the conditions for implementation of IBS enterprise software throughout the Group. Cooperation began with a pilot project for AxFlow’s operation in the U.K., one of the Group’s largest units, which was already trying to handle high IT costs.
The pilot included an IBS system implementation that covered order management and replenishment for financial software, distribution software and manufacturing systems. In addition, AxFlow has purchased IBS Integrator, which is a powerful tool for systems integration, business process tracking, data management, data replication and synchronization. IBS Integrator, along with the Service Oriented Architecture (SOA) of IBS software gives AxFlow the most efficient functionality to manage its pan-European customers and suppliers.
”The challenge for a project of this size,” says Weiner, ”is often of a technical or financial character, along with stability and reliability. But it is crucial not to underestimate the cultural differences. In our project, this means us as well as IBS, where people from different countries on different teams work together toward a common goal. Then it’s about understanding and respecting each others’ various needs and on focusing a great deal on communication and training.”
Fast pan-European implementation
The pilot was developed successfully and entirely in line with AxFlow’s requirements for IBS. The next step was to implement a new ERP system, including all of the pilot modules, for the entire Group in 16 countries and 17 companies. IBS took charge of ensuring well-functioning ERP solutions that include software, consulting services, hardware and networks. IBS also provided email and security systems, as well as the maintenance and management of the entire system. IBM hardware also became part of the solution in AxFlow’s case.
The IBS ERP solution had successive go-lives, with all implementations finished before the end of 2005. Fast, successful implementations were marked by the final 12 AxFlow installations being completed in one year. The next step is to implement additional functionality that the solution makes possible.
Among AxFlow’s goals for the entire project were to achieve cost savings and profit gains. The underlying aim was better efficiency, which in turn enables improved business processes. This helped AxFlow handle requirements of different locations with various business partners when it came to sales, a combination of centralized and decentralized warehouse management, and simplified integration.
"We have an extremely interesting future ahead of us and it is important to note that we still have a way to go,” says Ole Weiner. “It is difficult to know exactly which financial wins we can achieve with a unified structure. We are counting on a more efficient IT environment leading to many positive effects for us, including a positive ROI. Our most important goal is to provide better lead-times for our customers and better service from our sales staff, and to strengthen the way we manage pan-European customers.”