Segezha Group Implementing S/4HANA, SAP-Based Digital Management Platform

SAP, Segezha Group, MTS and BearingPoint have announced the launch of a digital transformation program and implementation of an integrated enterprise management system based on SAP S/4HANA and SAP Central Finance. The project is expected to take one and a half years, the transformation will bring together four enterprises for manufacturing of paper, packaging, plywood and lumber, as well as five logging sites.
The expected business effects of this transformation include improved accuracy in planning and execution of production, significant reduction in emergency downtime of equipment and warehouse stocks, optimization of transportation costs, as well as faster execution of various financial planning tools and action scenarios. BearingPoint Company, that provides services in business consulting and technologies to global companies in more than 75 countries, will serve as a partner in implementing the program. The project technology will be based on the infrastructure of #CloudMTS provider (part of MTS Group).
Plans are for the new platform to replace more than 100 production and management systems and create a new digital core of the company that will support growth and high standards for cost management. The project is unique in terms of its process and functional scope: the created system will support all business functions of five different types of production activities.
The project will result in processes of production management, quality management, supply and stock management, warehousing, repairs, sales and transportation services being integrated into a single platform. Access to information from all production sites will be through a convenient, intuitive interface, accessible on any device, including tablets and smartphones.
The management company of Segezha Group will be responsible for implementing the solution for managing financial planning and budgeting, consolidated management and IFRS reporting, as well as centralized cash management for all enterprises of the Group. A key element of this solution will be the SAP Central Finance system, which allows receiving all primary information from all enterprises of the Group in real time. Working with real-time data will help significantly shorten the time needed to close a reporting period.
The digital management platform for Segezha Group will be located in a private cloud created in Advantage, MTS’s own data center. The #CloudMTS provider will guarantee implementation, operation and maintenance of the project infrastructure at the level of the cloud and the IT equipment. The provider will also carry out administration and support services for the operation of the SAP system in the cloud, including implementation and maintenance of the platform’s technical equipment. Reliability and continuity of all business systems will be ensured by highly resilient #CloudMTS infrastructure: with its own Tier-III certified data center, MTS’s own communication channels and full backup of all data.
“The SAP S/4HANA platform is a new generation system that allows users to employ cutting-edge business models, accelerate development of applications and provide real-time analytics that are essential for making informed decisions. This will allow our company to significantly improve the efficiency of our business processes, which in turn will ensure faster growth and development of the company. The effects of the project will be comprehensive and will result in creating the foundation for better competitiveness of the Segezha Group and allow the company to enter new markets,” said Pavel Vakhnin, Vice President for Information Technology and Process Automation in Segezha Group of Companies.
“Segezha Group is an excellent example of a dynamic, fast-developing company. Today the Group unites more than 30 production facilities in forest, woodworking and pulp and paper industries. Considerable IT support is necessary to achieve centralized collection of data on the performance of all the enterprises, to manage costs and the supply chain processes responsibly. SAP S/4HANA is the digital nucleus of the business. This is a system for qualitative restructuring of the business, and a platform for further digital initiatives to be implemented in the company,” said Dmitry Pilipenko, Deputy Director General for SAP CIS Projects.

“Cloud technologies are becoming the foundation for business digitalization, and they allow for faster implementation of complex IT projects, such as those implemented by Segezha Group. Using cloud technologies we will be able to provide for faster implementation and further scaling of the company's digital platform. We will be happy to apply our expertise and experience in using #CloudMTS to help build large-scale cloud infrastructure for leading Russian companies. This is not our first experience of joint projects with Segezha Group: the company uses telecom services and communication channels provided by MTS, and we have implemented a number of projects on system integration,” said Oleg Motovilov, director of #CloudMTS cloud provider.
“We are pleased to become Segezha Group’s partner in digital business transformation and the process of introducing the advanced SAP S/4HANA system and are confident that our experience in implementing complex projects will enable Segezha to achieve the expected results,” said Alexander Zyuzukin, a partner with BearingPoint.
In the future all the template solutions will be copied to all other enterprises of Segezha Group. Scalability of the system will allow launching new business processes, if necessary. In particular, integrated business planning and reliability management processes will be implemented along with forecasting systems and machine learning in various functional dimensions and a multitude of different innovative scenarios.