You may recognize the name Hunter Douglas if you have the company’s blinds in your home. Hunter Douglas actually invented the aluminum blind in 1946. But it’s come a long way in innovating the simple shade, adding unique designs, energy-efficient features, and technologies such as voice-controlled and automated window coverings. Today, it’s also a leading manufacturer of architectural products such as sun control solutions, ventilated facade systems, and suspended ceilings.

Change Management Across a Decentralized Group

In reality, Hunter Douglas Global is made up of 132 small- and medium-sized companies operating in 100 countries around the world, with dozens of locations in North America alone. This structure has led to disparate, disconnected legacy systems that prevented the company from having visibility over its inventory. Adding to this challenge, the window covering business is as diverse as the windows around us—very few products are standard, and most are completely custom.

To turn this situation around, the company is taking all of its North American sites through an ambitious greenfield implementation of SAP S/4HANA on the cloud, which includes Sales and Distribution, Financial Accounting and Controlling (FICO), Warehouse Management, Integrated Business Planning, Manufacturing Integration and Intelligence, and Business Intelligence. After the implementation, Hunter Douglas hopes to bring efficiencies such as reducing its scrap and remakes, as well as decreasing obsolete inventory.

ASUG News had the opportunity to speak with Stephen Katsirubas, the CIO at Hunter Douglas who’s responsible for the North American IT organization, about the company’s SAP S/4HANA transition.

Ann Marie: Tell me about what led Hunter Douglas to pursue a greenfield implementation of SAP S/4HANA.

Stephen: Hunter Douglas is historically a very decentralized organization that’s grown through many vertical acquisitions. It's our culture to leave local management teams alone to let them do their thing. Even though they’ve all been on SAP for a long time, our processes aren’t aligned. We’ve been running ECC for a long time, but we have multiple instances. We’re heavy users of varying configurators because of all the permutations of our products. With window shades, the choices go beyond length and width. It’s fabrics, head rails, lift systems, types of motorization, and so forth. Unfortunately, one of the instances of SAP that runs our customization of our product is heavily customized.

Ann Marie: So, the customizer is customized?

Stephen: Yes. We wanted to move the whole program, called One Hunter Douglas, to a single platform. That’s why we went greenfield. We couldn’t take the systems that we had forward. We’re trying to unravel some of the complexity we’ve created and simplify our business.

Ann Marie: And why did you decide to implement in the cloud?

Stephen: We looked at a handful of providers. A few years ago, the public cloud offerings were not mature at all. We were looking for a service offering, yet there was nobody really saying, “Hey, we’re deploying SAP S/4HANA on AWS and here’s the package.” A bare metal package wasn't going to work for us. So, we went with Virtustream private cloud.

Ann Marie: What are some of the challenges that you’re facing during implementation?

Stephen: Not enough money. Not enough people. Not enough time. That’s pretty consistent, right? You could have it tattooed on you.

Ann Marie: That’s right. I’m sure you’re not alone there.

Stephen: We acquired Levolor from Newell Rubbermaid about two years ago. They were first to go live on SAP S/4HANA in March of this year—both their back office and one of their two clients. We have another deployment coming up in September for our manufacturing business, and then Q1 of 2019 we have another deployment that will wrap this whole thing up.

As you can imagine, we’re trying to support two ECC environments, our new SAP S/4HANA environment, along with working on subsequent deployments. We have 18 different shop floor systems in use, many of which are homegrown. We’re moving everything to SAP Manufacturing Execution or SAP Manufacturing Integration and Intelligence. It’s complex architecturally, and it’s hard to find people with the skill sets to understand it.

Ann Marie: Is there anything you wish you had known before you started?

Stephen: I think we underestimated the scope, specifically around the fabrication and manufacturing environment. I think we really underestimated the amount of implementation work it was going to take.

Ann Marie: At this point, you have three different deployments. How are you managing your talent? Are they focused on one project? Or multiple?

Stephen: We’re telling people, “Hey, awesome job. I know you’re helping out here, but I need you to do additional work for the other deployment simultaneously.” People are splitting their time. We’ve also augmented some of our support by working with NIMBL to help alleviate some of the burden on our people. For issues with our core ERP, the first line of defense for us is NIMBL. It's funny. Some people have a high sense of ownership and they’re hesitant to turn stuff over. I tell them, “Let these guys do what I’m paying them to do.”

We’ll continue to augment our staff. Our timelines are aggressive, so we need to do what we can to get this thing done. If we need to spend another million dollars, let’s do that at the risk of spending $18 million.

Ann Marie: Right, and risk never getting it done.

Stephen: That’s what we do with NIMBL. It’s like a million-dollar insurance policy.

Ann Marie: So, what are some of the benefits that you’ve realized?

Stephen: The transition for Levolor was fairly seamless, with very little business interruption. We’ve already heard from customer service and others who are singing praises about how much new visibility they have. We’ve implemented available-to-promise functionality for them, which we didn’t have before. When you work in a customized product business like we do, we don't know what we’re making five days from now. We’re going to make whatever somebody wants, so it’s very hard to set expectations and make sure we’ve got the right amount of materials, parts, and components. We tend to be overstocked and overinventoried. Hopefully in the long term, we’ll see better inventory management across our entire enterprise.

Ann Marie: Do you have any other plans to tie in other SAP products? Or are you just focusing on the SAP S/4HANA project?

Stephen: We’re doing a lot with analytics, because we need to address big data at some point. We have a very complex environment today. Nine Business Warehouse instances, for example. We’re moving this all to one instance on HANA. But we haven’t addressed the longer-term needs around data tiering and storage to keep our expenses down.

We might look at SAP Ariba and some offerings around spend management and procurement, and potentially some human capital management offerings, such as SAP SuccessFactors. But the dance card’s a little bit full right now. We’re talking 2020 at the earliest, because 2019 is going to be all about stabilization. And squeezing the operational benefit out of what we’ve just done.

Ann Marie: What’s your biggest piece of advice to other customers who are considering the switch to SAP S/4 HANA?

Stephen: I’ve always felt that you know your business better than any consultant. SAP value engineering has been helpful to me in the past, so I’ve leveraged that. You’ve also got to figure out how much you need to move the needle to pay for a big project like this. Other advice would be to ask for double the money you think you need. There is always unexpected spend—other licenses and packages you’ll need. You may think you understand this, but you really don’t. You should understand the availability of some of these specific skillsets you’ll need. It’s tough to find good people, right? You want the A team. You don’t want the B and C team.

We have a great partnership with SAP, best I’ve had in my career. SAP has been at the table on this project and we got them engaged. Some of them meet with our team on a weekly basis to make sure that we’re getting everything we need. Make sure you have close alignment with SAP and that they’re vested in your success.

Ann Marie: Pivoting a little bit, why do you think it’s so important for IT and CIOs to participate in the company’s business strategy as opposed to just doing IT work?

Stephen: You need to know where the company’s going. And we want to bring innovation to the table, right? We are the art of what's possible. I can bring the perception and insight into how technology applies to what we’re trying to do as a business.

Ann Marie: You mentioned that you moved Levolor to SAP S/4HANA first. Was there any backlash from that, given that you just bought them?

Stephen: It’s an interesting organization, because they were part of Newell, which had shared services. They weren’t buying their own IT, Newell was. So, no, there wasn’t pushback. At the end of the day they’ve been pretty positive. From a culture point of view, Hunter Douglas is very different from Newell. We’re family. We value integrity, longevity, and loyalty. We’re a nice company to work for, so I think people welcomed the changes.

Ann Marie: Not as much change management as you expected?

Stephen: No, not as much. People are open to change. It’s got to be deliberate and thought through. There’s a lot of discussion that goes into things at Hunter Douglas. We’re not making quick decisions, we’re not reacting, and we’re not screaming and yelling at people. That’s not how we operate. We care about our people. And we mean it, we don’t just say it.

Ann Marie: What kind of external help and support is most valuable for you?

Stephen: I’ve been on this SAP implementation treadmill for about ten years, and there’s never enough time. I haven’t been in a steady-state mode for a long time. To me, a lot of the value I get is from plugging in with people, getting connected, and sharing challenges. Who are the people that blaze the trail before you that you can learn from? When I was in retail, I had a network of people I could just pick up the phone and call and ask, “Hey, I heard you guys implemented this. Tell me the skinny.” What’s that worth? It's worth huge amounts of money, right?

Ann Marie: Absolutely.

Stephen: During my 20 years in retail, I met so many great people and did a lot of great networking. So that’s my preference when it comes to support.

Ann Marie: Stephen, thanks so much for your time. I know our community really appreciates hearing from you about your experiences, too.

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