Bioenergy expert Vapo moved from reaction to prediction

The Baltic Sea region’s bioenergy expert Vapo, which produces heat for one million Finns, made a strategic change of course a few years back. This also led to a new ICT strategy and a determined shift to a new ERP system.

Strategy and the challenges of  globalisation in the background

“We wanted to move from reaction to prediction, to make our own measures part of the operational performance in a controlled way. Business intelligence will become our key strength,” explains CFO Asko Dahlbom.

The new IT solutions are based on Vapo’s view of the future. Central starting points include the group’s business growth in the Baltic region and the ever-growing demand for bioenergy. 

“Based on the prospects and the situation at the time, we created some development path drafts together with the consultants from Tieto,” Dahlbom says.

The change of course began in 2006, when the group strategy, organisation and the challenges of globalisation were reviewed. Alongside the matrix organisation, an ICT strategy was designed to serve profitable growth and development.

“Our starting points were the various systems for operation management, reporting and customer interface management that had been created through the decades in our different branches. Only the financial system was common to all; the others have been created and tailored according to the specifications of each individual branch,” Dahlbom explains.

Basic system and applications for Vapo’s special needs

The basic solution behind Vapo’s new ERP system is Microsoft Dynamics AX; Cognos is used for reporting. The practical solutions extend from unifying the core operations to managing maintenance of machinery and equipment. The basic systems are supplemented by applications required by Vapo’s processes, where, for example, geographic information is applied to marsh management and wood procurement.  

The group, which has close to 1,800 employees, began the introduction of the new system in the Baltic countries with its Estonian subsidiary in 2008. From there they proceeded to Latvia and the extensive garden and environmental business in Finland, including among others the growing medium and fertiliser manufacturer Kekkilä. The large and carefully planned project will be finished in 2011.

“Dynamics has proved to be of the right size class for us. Firstly, it is a good fit with all our business operations, but is not too heavy for any of them. In addition, the availability of system know-how and suppliers is good in this geographic area,” states Dahlbom.

The management of the wide ERP project was made easier by dividing it into smaller pieces, each having an owner and a core user. Combined, they cover the group’s entire operations; the result, according to Dahlbom, is a combination of an ERP system and a company management system.

The results

A central target was to improve the transparency of management. Together with the ERP and reporting solutions, process functionality and management quality have been developed. “The end result is re-learning. Vapo’s employees are encouraged to go through the processes systematically and in a business-oriented way,” Dahlbom clarifies.  

 “One of the criteria for the supplier was the ability for long-term commitment and to serve us locally. Our assessment has been accurate. Vapo’s project teams, together with Tieto’s project organisation, have found a common way to manage projects and implement project management solutions and reporting methods that make solutions easier. This also helps in solution management. It’s not just a question of having new practices for ICT and the project organisation, but having new practices for the entire business,” Dahlbom points out.

Challenge

Vapo got various systems for operation management, reporting and customer interface management that had been created through the decades in our different branches. Only the financial system was common to all; the others have been created and tailored according to the specifications of each individual branch.

Solution

Tieto has provided consultancy and IT services to regions where its knowledge of the customer’s business and needs are the deepest. The basic solution behind Vapo’s new ERP system is Microsoft Dynamics AX; Cognos is used for reporting. The basic systems are supplemented by applications required by Vapo’s processes, where, for example, geographic information is applied to marsh management and wood procurement.  

Results

Vapo’s project teams, together with Tieto’s project organisation, have found a common way to manage projects and implement project management solutions and reporting methods that make solutions easier.