Kellogg Company is one of the world’s leading producers of cereal, cookies, crackers, savory snacks, and frozen foods. Headquartered in Battle Creek, Michigan, Kellogg has more than 50 manufacturing plants on six continents, over 31,000 employees, and $13.2 billion annual revenues. With well-loved brands such as Cheez-It, Eggo, Frosted Flakes, Kashi, Keebler, Pop-Tarts, Rice Krispies, Special K, and many others being produced in 18 countries and marketed in more than 180 countries, the company must ensure that its supply chain is operating as efficiently as possible with clean and consistent data.
To improve system integration and information access, as well as create a foundation for the future, Kellogg opted to move off of its heavily customized SAP environment and migrate the business data to a standardized landscape. Upgrading the SAP system would allow for better information sharing, management, and analysis — which, in turn, would lead to improved decision making across the organization.
Diana Karklins, Vice President of Application Solutions at Kellogg, shares insights into why and how the company underwent its massive data conversion and upgrade to transform its business.
“Executive management understood from the start that this initiative would improve the way Kellogg does business, while creating more efficient operations and sources of information.”
— Diana Karklins, Vice President of Application Solutions, Kellogg
Q: What motivated Kellogg to undertake an IT transformation of this scale?
Our global supply chain lead, CFO, and CIO provided executive sponsorship for this initiative and set the strategy. They understood from the start that this initiative would improve the way Kellogg does business, while creating more efficient operations and sources of information.
Previously, our SAP software had many levels of heavy customization. We understood that transitioning to a standardized system would make us more nimble, help us keep up with changes in our business, and allow employees to analyze and share information more fully and easily. Standardized data and systems allow us to quickly take advantage of upgrades and updates, which in turn makes us more effective and efficient.
We upgraded our version of the SAP software to capitalize on the latest technology. This upgrade creates efficiencies that allow our employees to spend less time on administrative steps associated with their jobs and more time focused on the business and our customers.
We selected SAP products that would replace our current ERP landscape, including the SAP solutions for enterprise information management. Some of the products we selected include SAP Data Services, SAP ERP, SAP Supply Chain Management (SAP SCM), SAP NetWeaver Business Warehouse (SAP NetWeaver BW), SAP Customer Relationship Management (SAP CRM), and SAP Business Planning and Consolidation.
Q: How many Kellogg employees were affected by the upgrade, and how did you prepare these business users for the changes that the new technology would bring?
This initiative touches every function and nearly every person at Kellogg in the US and Canada. This includes everybody who does business with Kellogg, such as our suppliers and co-manufacturers.
Right now, the scope of the project is limited to the US and Canada, but all of the data standards have been agreed to globally. Latin America will be the next region to roll out the upgrade, and they will follow the established template.
To prepare employees for the change, our project organizational change management team identified all affected users and suppliers, helped educate network leaders on the upcoming changes, and then ensured training needs were met for all employees. The education varied from instructor-led sessions to web-based training and assigned job aids, depending on the number of people and the amount of change required.
Q: What was involved in the project in terms of processes and people?
There were more than 100 employees involved in the project full time, with many additional employees involved part time. The project team included employees from IT as well as business representation from every impacted function.
There were four phases of the implementation:
- The Preparation phase consisted of the initial planning for the program.
- The Blueprint phase involved the creation of a high-level solution design.
- In the Realization phase, we built and tested the data solutions.
- The Deployment phase involved rolling the solution out to users.
After an extensive vendor evaluation process, we selected Accenture and SAP as our primary consulting partners.
Q: Did you encounter any challenges during your data migration efforts?
We converted all of our data into the new system, so it was definitely a major undertaking. We went through a considerable data cleansing effort, data mapping, redefined standardized data definitions, and data conversion.
One of the challenges was constructing data to fit the new definitions. All of our business representatives sat down together to decide the field names and meanings of every field and its data options. We needed different functional teams to agree on common data definitions and values. We showed them the inefficiencies from the old system and explained how the standardized system would make it better.
For example, we had several different spellings and abbreviations of Special K, and users didn’t know what to search for. The uniform system ensures that all business functions use standardized terminology.
Q: Can you share any business benefits that have materialized?
We are able to ensure high data quality, and we will be able to retain the pristine data that we put into the system. Standardized data provides a foundation for better information management and decision making. In addition, future upgrades to the system will be much easier to implement. As we continue to implement this solution, we also expect financial benefits to start going back into the business.
One example of how this project has benefitted employees across functions includes simplified expense reporting. We are also improving information management via improved reporting, made possible by standardized data. This standardized data has led to common definitions of key performance indicators (KPIs).
Q: What advice would you give to others who are considering undertaking a similar initiative?
Executive sponsorship and organizational commitment is important for any large project. It is crucial to involve key decision makers from the start and to assign the right people to the project — people who know the business and feel invested in its success.