Consolidating big time, but going agile

Leading consumer packaging firm Rexam is well on the way to achieving a single management view of its pan-European beverage can manufacturing plants and business as a result of centralising and consolidating its IT across Europe on SAP and HP. So successful has this ambitious project been that the system, currently running five of its Can sector's 19 plants, is now being rolled out not only to the remaining can plants, but also to a number of other sectors within the group, including the Glass division, with Beauty & Closures later this year. The European can sector makes up a significant part of the Rexam business, and the firm says it's already seeing the benefits and efficiencies that flow from running the live sites as a single business unit. Additionally, it confirms that it's improved its IT resilience and management while also reducing costs. The HP/SAP solution will eventually support 3,300 Rexam employees across the sector. Rexam may not be a household name but its consumer packaging products are used by millions. World-wide, the company makes 50 billion cans a year for Coke, Pepsi, most beers and lagers, as well as glass and plastic bottles for soft drinks, spirits, juices and water. It also manufactures the packaging for a vast array of food and beauty products. Indeed, Rexam is among the world's top five in its field, with over 90 manufacturing plants, 22,000 employees and a turnover approaching £3.4bn. It's beverage can sector is the number one in Europe. It's big and the firm had the IT complexity of any business that's been around for more than 100 years, and gone through decades of diversification followed by consolidation to core business. Three years ago the Rexam Group found itself with too many different, non-integrated legacy systems – a situation brought to a head in 2000 with the merger of the ANC can group in the UK and the Swedish beverage packing company PLM to form Beverage Cans Europe & Asia. ANC, with 12 plants across Europe, had centralised a lot of its IT on SAP ERP, but only in finance, while everything else was run on separate systems. On the other hand, PLM, which was also on SAP, and in this case for most of the applications, was country-based, so with multiple versions and instances. Says Bo-Arne Olsson, Rexam's vice president of IT Europe: "We wanted to run the companies as one business, and to change to a supply chain management business model. This is just not possible without having common integrated information." He means the business of getting systems to support standardised part codes, customers, suppliers and the rest, and achieving single rolled-up views of business-critical information to improve inventory control and manage pan-European sales, procurement and supply. "We needed information on a sector level with visibility down to our plants. Achieving that requires a common system that we did not have before," he says. Consolidation plan Rexam turned to SAP and Hewlett-Packard, launching a substantial project in 2001 to consolidate and centralise these systems across Europe on a cohesive yet flexible solution. "We had had SAP from the beginning in the two businesses and our company just cannot function without it. We consider it to be the major ERP system in the world so it was not a difficult decision to continue," says Olsson. Meanwhile, on the infrastructure side, ANC had similar experience and views of its HP hardware and operating system environment. Says John Neal, Rexam Beverage Can Europe & Asia's IT technical director: "HP had been our provider of Unix computers since 1985, and they had always proved reliable. Also, the long term cost of ownership is less than some of the alternatives because of the stability of the products and their resilience – which means you need less people to manage them and standard skill sets." So after investigating and rejecting the outsource model, HP was the obvious choice, and the Consulting & Integration arm of HP Services was brought in to design a consolidation strategy. Says Ollson: "When we started this project I was convinced that we should outsource the operation, but we soon found that it was going to be quite a lot more expensive than doing it ourselves. Also, our Glass sector had outsourced its SAP operation and was not happy. So we decided to provide the centralised service in-house on HP." The decision paid off – and for other reasons too. This was always going to be a potentially very big and certainly evolving project, so one of the keys to success had to be scaleability. Says Neal: "Early on, we had to allow for the possibility, for example, that we might want to implement all of the plants on a per-SAP module basis, or one plant at a time with all the modules, so it had to be flexible and future-proof." In fact, to maximise return on its investment, Rexam subsequently decided that the Glass division would join Cans on the new infrastructure – starting with its German plants as a result of acquisitions – and be followed by Beauty & Closures, with the option of others also joining. Neal confirms that with HP's 'Adaptive Enterprise' concept and its scaleable server families built on a single operating system and technology set, he's confident of success. Everything is now based on a dual site approach, with a new production data centre constructed in Stevenage at the Group HQ running the live business machines, while disaster recovery (DR), development and QA are at the Luton Beverage Cans sector HQ. Says Neal: "Stevenage is a purpose-built, high resilience environment with air conditioning, UPS, dual network pipes and the rest that we can run indefinitely. We chose to locate the back-up mirror system in Luton, with the same storage devices and so on because that was the safest way." Dual datacentres Looking specifically at the Can sector, currently, the system runs most SAP R/3 applications, including financials, materials management, production planning, warehouse management, sales and distribution and HR, with a 100Gb SAP database managing all business at five of its European plants. That will increase by the end of the year to 300Gb, with HP and SAP eventually supporting the work of 3,300 Can sector employees across Europe. In a little detail, the systems run on servers from HP's RP family, specifically the RP5430 and RP5405 models. On the live production side, Cans and Glass so far each run a central database server with two application servers, while for DR, development and QA, Cans has two servers and Glass runs three clustered servers. As for storage, that's provided by HP StorageWorks XP128 Storage Area Network (SAN) disk arrays with HP FC16b fibre channel switches, and MSL 6000 tape libraries situated at both locations, plus tape auto-loaders for backup and recovery and LTO2 tape technology. Why the choice of HP SAN? Neal explains that the company required high availability, high resilience storage for its business-critical operations, but again with the adaptability to allow for growth. And Rexam's SAP director David Tucker agrees, adding: "We needed to make sure that the large investment in disk space could also be utilised by other applications that were non Oracle and non Unix. We found that HP's SAN technology was very open so we could provide central storage not only for Unix and Oracle, but for Windows, for instance." And examples of those include Rexam's central pallet tracking system, its can graphics design systems and its Cognos business intelligence systems, running on Windows. With substantial parts of the Can and Glass sectors already running on the new centralised solution, Beauty & Closures is due on line by mid year running out of the Stevenage/Luton data centre combination, with as much complexity again. More will follow. "There is a very solid partnership between HP and Rexam," says Tucker. "HP recognises that it needs to support our business – and the importance of reliability, high resilience and virtually 100% uptime. That will enable 3,000 people within Rexam to function efficiently and allow us to maintain our leading position in an extremely competitive arena."