Rethinking information logistics: transparency and control for all processes

The Gustav Heess Group manufactures and distributes premium oils for the pharmaceutical, cosmetics, food, and chemical industries. The Group’s objective is to establish comprehensive quality management and guarantee seamless, end-to-end information logistics. Yaveon implemented Microsoft Dynamics NAV with its industry-specific ERP solution for quality control, financial accounting, and materials management. The challenge for the new ERP system was to unify all business processes under Microsoft Dynamics NAV.

The Gustav Heess Group, a manufacturer and distributor of premium oils for the pharmaceutical, cosmetics, food, and chemical industries, has set itself the goal of establishing comprehensive quality management. This also includes seamless, end-to-end information logistics. Until now, quality control, financial accounting, and materials management were managed in separate systems: Gustav Heess has now consolidated all business processes in a single ERP system with Yaveon’s industry-specific ERP solution based on Microsoft Dynamics NAV.

Vegetable oils and fats are unique substances. Cold-pressed or refined, oils with a wide variety of properties are found all over the world – along with their uses in a broad spectrum of industries. They serve as pure oils in the food, cosmetics, and pharmaceutical industries, but also as ingredients or additives in technical applications such as the paint industry. The Gustav Heess Group is a traditional family-owned company from Swabia with an international outlook, specializing in supplying customers in the food, pharmaceutical, cosmetics, and chemical industries with suitable vegetable oils and fats. Its core business is consistently sourcing and delivering the right oil with the desired properties.

Like all companies, Gustav Heess must ensure that order processing, logistics (SCM), and quality control work hand in hand to fulfill customer requirements accurately and on time. This is especially critical in terms of quality, as customer expectations for purity and product properties have risen significantly in recent years. While the food industry increasingly demands organically produced oils, the pharmaceutical industry prioritizes compliance with the European Pharmacopoeia. In chemical and technical applications, product and processing properties must always be guaranteed.

“It has now become explicit company policy to include all processes within the value chain in the QM system,” says Joanna Weretka, Sales Manager and one of the two ERP project managers at Gustav Heess, quoting company policy. “To make this vision a reality, it was necessary to completely rethink the company’s IT,” adds Jan-Gregor Nitsche, Head of IT and second project manager. Gustav Heess is certified according to ISO 9000, and its laboratory is accredited to ISO 17025.

The numerous customer and regulatory quality audits become much easier with a system that consolidates all status information and documents in one place. After the project managers and specialist departments had drawn up an extensive list of requirements, various systems suitable for medium-sized businesses were evaluated starting in 2009. It soon became clear that Microsoft Dynamics NAV represented a future-proof and scalable solution for the further development of Gustav Heess. “Finding the right partner for implementation was not easy, as there are several NAV partners with experience in the food industry. But the workshops with Yaveon showed us that they understood our needs best,” says Jan-Gregor Nitsche. Not least, the GMP expertise was decisive, since the Gustav Heess Group wants to ensure long-term ability to supply pharmaceutical customers. Starting in spring 2010, the new system based on Yaveon’s industry-specific ERP solution was developed together at the Group’s headquarters in Stuttgart.

Central components of the new solution are seamless lot tracking, comprehensive quality and certificate management, as well as the management of article specifications. “Now we maintain all data on articles and batches only once in the integrated data master,” explains Annette Schaffer, Head of Laboratory at the Gustav Heess Group. “All certificates and specifications can be retrieved immediately, and the labels are printed directly from Microsoft Dynamics NAV.” Almost all inventories are now labeled with the correct batch numbers, bilingual designations, and barcodes. Errors are thus significantly reduced. And with just a few clicks, all necessary certificates of analysis can be retrieved and provided to the customer as proof.

Thanks to the integrated field security, it is possible for articles or suppliers to be released only by authorized employees. Misunderstandings are avoided, and special customer requests can be passed back to the very beginning of the supply chain.

The industry-specific ERP solution from Yaveon captures all customer requirements and restrictions and facilitates the assignment of the correct batches through the central information pool. In the future, the system will schedule the batches and plan procurement. “But to do this, we first have some homework to do, namely integrating subcontract manufacturing by various contract manufacturers into the system,” says Schaffer.

In addition to comprehensive quality assurance, logistics represents the second core of batch management. The entire flow of goods is now mapped directly in the system. When tanker trucks arrive at the gate, the necessary inspection orders are immediately generated, and the laboratory results are stored in the system. In warehouse receiving, the released batch can then be transferred from the tanker to drums or IBCs via filling stations.

The scales are fully integrated into NAV so that quantity and batch information are immediately transferred into the warehouse data. “We were even able to replicate the convenience functions of our dual scale in Microsoft Dynamics NAV, so there was no slowdown in processes at the filling station,” says Nitsche. The connected label printer ensures the clear identification of containers and secure lot tracking.

Separated storage zones for organic-certified oils, refrigerated goods, and others prevent contamination or serious mix-ups. Within the zones, the Gustav Heess Group uses dynamic warehousing, generally picked according to the FIFO principle. There are also different transfer and filling stations. This way, oils for food can be bottled according to the HACCP concept, while technical oils require less effort.

Yaveon not only had the appropriate industry-specific ERP solution, but also a suitable implementation methodology and employees with extensive industry know-how. “I have experienced three NAV implementations with three different partners in my professional life. The one with Yaveon was by far the best,” says Logistics Manager Bettina Pillich. “Not only did the Yaveon employees always understand us professionally, but they also showed great commitment.” Yaveon’s approach is always process-oriented but also adapts to the circumstances at Gustav Heess. “It was so important to involve all departments in the change process. And no one was allowed to be overwhelmed,” says Joanna Weretka.

Therefore, the project team ensured that initially only the absolutely necessary processes were introduced. Others were only prepared at first, to be implemented gradually later, once more experience with usage was gained: After six months of live operation, almost the entire inventory had been turned over once and labeled with barcode labels. “Only now does it make sense to electronically record not just the scales, but also the individual containers and batches,” says Pillich, whose logistics staff had in some cases never worked with IT support before. Simple masks for the industry touch panels at the filling stations are also tailored to the needs of the logistics processes.

The go-live on February 1, 2011, went completely according to plan, and the entire project was delivered exactly on budget. There was no data loss whatsoever, and all orders could be processed from day one. The financial accounting could also be switched immediately—with the entries already posted in the current year. With the integrated ERP system, Gustav Heess is now able to optimize business processes. Likewise, it can respond at any time to the challenges of globalization and market changes.

“With Microsoft Dynamics NAV, we have gained a great deal of flexibility and investment security,” says Nitsche. With the possibilities of data exchange within and outside the organization, further fully automated business processes will, over time, increase quality and thus customer satisfaction. “For us, this was a very successful project,” summarizes Joana Weretka.