Success Story SAP Business Information Warehouse (SAP BW) at Merck dura: Permanent supply capability, efficient controlling and active marketing Merck dura resulted from the merger of Merck Generika GmbH and durachemie GmbH and, as a subsidiary of the Merck Group based in Darmstadt, has been offering doctors and patients a comprehensive range of generic products since 1997. These are drugs for which the exploitation and patent rights are no longer held by the original applicant. With about 200 employees and 800 different drugs, with an average of 2,500 batches in storage, Merck dura currently achieves sales worth DM 115 million. This makes the company one of Germany’s largest manufacturers of generic goods. It is the aim of Merck dura to develop the highest-quality combinations of active ingredients in response to customer needs and to market these cost-effectively. In a highly competitive and price-driven market, this is a constant challenge for its sales organization and in particular its Logistics department. With SAP BW, the generic Lack of flexibility in the old systems products manufacturer Before implementing SAP BW, Merck dura controlled its sales and marketing activities and parts of its logistics planning using a marketing Merck dura has imple- and distribution information system it had developed in-house which was mented an information linked up to a field service control system provided by another supplier. system that guarantees This was used to put into context and evaluate planned and actual product the company permanent turnover and sales, stocks, regional market development and the purchasing behavior of customers and customer groups. The disadvantage supply capability and was that the system was not flexible enough to meet the demands of sales avoids cost-intensive and commercial controlling in every respect. deterioration of goods in storage. SAP BW also provides a basis for com- prehensive reporting, which provides reliable information on product sale and distribution and also supports marketing. In the context of business dynamics, concept was developed. Only three Optimizing sales policy there was also insufficient interlink- months later, the first of the two With the help of the data analysis ing of marketing and logistical planned Data Marts, the Logistics feature in SAP BW, Merck dura planning and control. A further Data Mart, went live. “SAP BW met also checks whether the current drawback was that the typical with a positive reception from the positioning is helping to improve evaluations of the pharmaceuticals outset, because its benefits are gross revenue and the profit contri- industry relating to the product and immediately apparent,” says Frank butions of particular products. market data of rival suppliers were Wondrak, Chief Information Officer For example, Merck dura can now carried out in separate systems, at Merck dura. SAP BW will there- detect from a single user interface which led to a break in media usage fore become the central information whether company turnover and for the end users. system for all employees in Control- sales figures deviate from the ling, Sales, Marketing and Logistics. market figures (RPM and DPM data). Ambitious goals “This gives us important informa- These third-party sources include Ensuring availability tion on how we need to shape our market data relating to the pharma- The Logistics Data Mart is an early terms and conditions and our ceuticals business in Germany, as warning and information system distribution policy,” explains Frank provided by the Frankfurt-based that integrates logistics and sales Wondrak. He adds that thanks to Institute for Medical Statistics (IMS data. Among other activities, SAP reporting being performed on a GmbH) – data on the regional BW evaluates data from the ERP daily, monthly and annual basis, pharmaceuticals market (RPM data) system – Merck dura is migrating SAP BW makes it easier to calculate provides information on the sale of from SAP R/2® to SAP R/3® – and in advance sales volumes, prices and individual products in a particular the rolling sales planning of Market- revenue or, if applicable, reductions geographical area; data on the ing. The crucial advantage of this is in revenue, and above all to react in German pharmaceuticals market that products and batches for which a more proactive way to market (DPM data) provides information on there is a need to take action developments, which in turn has a national wholesale sales by product. because of sales trends and stock direct influence on marketing and availability can be identified imme- field service control. The aim of introducing SAP BW diately at a glance. was to implement a powerful infor- Strategic solution mation system for supply chain With SAP BW, Merck dura is now in Through the integration of Sales and management, to tie in key economic a position to pursue product and Logistics, SAP BW is creating a key sales figures with external pharma- sales planning promptly, without element of future SCM and CRM ceuticals market data and to great effort. This means that the systems for Merck dura. “One reason guarantee a secure and uncompli- Development, Sales and Marketing we chose SAP BW is that it is an cated supply of data to the informa- departments can concentrate on new integrated part of the Internet tion system from SAP, which is products. “Our employees know in product family of mySAP.com,” used by Merck dura for its business two clicks of a mouse how long we confirms IT Head Frank Wondrak. operations. can still supply a particular drug, He adds that the sector-specific and which batches are getting close Pharma Business Content – Rapid implementation to their sell-by dates,” is how Frank consisting of pre-defined reports and The decision in favor of SAP BW Wondrak sums it up. This means analysis scenarios – will make the was made in the final quarter of that marketing and sales activities introduction of SAP BW much easier, 1999. Merck dura chose as its can be initiated and new production particularly in combination with the consultant the Weinheim-based orders placed that much earlier. parallel migration to SAP R/3. company Freudenberg IT KG, which Supply capability is guaranteed in was itself one of the first customers any event, and at the same time the of SAP BW. In mid-January 2000 inventories are constantly being the first workshop was held and the optimized. 50 043 372 (0011/13) SAP Headquarters: SAP AG, Neurottstr. 16, 69190 Walldorf, Germany, www.sap.com, Tel. +49 (180) 5 34 34 24, Fax +49 (180) 5 34 34 20 © 2000 by SAP AG. All rights reserved. SAP, the SAP logo, the mySAP.com logo, and other SAP products and services mentioned herein are registered or unregistered trademarks of SAP AG in Germany and in several other countries all over the world. All other product and service names mentioned are the trademarks of their respective owners. Design: SAP Communications Media. 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