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TMK pilots an SAP-based smart planning system

TMK began pilot operation of a production and sales planning system with a planning horizon of up to 18 months. Based on the SAP Integrated Business Planning (SAP IBP) solution, the project will streamline TMK’s key business areas to replace annual planning of sales and operations by rolling planning with monthly detailing.

The companies announced a new phase of the project at the fifth International SAP Conference for Mining and Metals co-organized by TMK. The event is planned to be held online on September 15, 2021.

Units responsible for market analysis, sales, purchasing, production, logistics, and other value chain processes have access to the system. Each of them enters and regularly updates respective ongoing performance data, medium-term plans, requests, and analytical information in the database. The system analyzes this data and uses a special algorithm to suggest improvements to planning to enhance engagements between units to the maximum. The system’s algorithm adapts to the strategic and tactical goals and objectives set by the Company’s management.

TMK has set up a dedicated unit to take maximum advantage of the solution. It will coordinate the work of employees in SAP IBP and use built-in tools to prepare monthly forecasts of the Company’s performance drawing on the accumulated data and relevant economic and production data.

“The transition to smart integrated planning is an important milestone in our program for digital transformation of operations. We now have new mathematical tools that will help us make management decisions and better adapt to market changes. The system is also designed to save the Company’s resources across a number of areas such as logistics costs, inventory levels, purchasing volumes, and effective use of equipment. We are currently at the pilot operation stage, with full transition to rolling planning slated for early 2022. As TMK expands, the project will be scaled up to new assets to maximize the effect for the Company’s business,” said Igor Korytko, CEO of TMK.

The project implemented by SAP Services CIS experts was unique for the CIS metals industry in terms of its scope and the complexity of its supply chain. Integration of the solution with other SAP products (SAP Business Warehouse) will increase planning accuracy and provide tools for operational variance analysis in making management decisions.

“The coronavirus pandemic has clearly shown the importance of digital solutions for restoring disrupted supply chains. TMK can leverage these effective planning tools to maintain the stability of its business as well as to boost its margins through the competent use of its business resources and risk management,” said Andrey Filatov, CEO of SAP CIS.

The project was the first, high-level milestone in building an end-to-end Integrated Planning System (IPS) at TMK. New modules will be added going forward, which will enable building a single order pipeline and corporate production program, allocate production orders across plants and shops, and schedule daily tasks.

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