Postal Service Transforms Distribution Network
Client:La Poste, the French Postal Service
- Transform the postal network into a retail sales channel
- Completely revamp the financial system
- Overhaul business processes
- Implement a new financial system based on SAP
- Standardized and centralized financial reporting
- Reduced accounting cycles
- Increased automation and fewer systems to maintain, resulting in cost savings
In the face of deregulation and new competition, the French postal service is transforming its massive distribution network into a retail sales channel. CSC has spearheaded the project, overseeing one of the largest SAP implementations ever undertaken in Europe.
La Poste is the national postal service in France, one of the many countries in Europe contending with postal deregulation and privatization. Under European Union rules, postal services were required to open up to competition by January 1, 2011, and publicly owned La Poste used this deadline as a catalyst for changing the way it does business.
With two million customers served every day, La Poste recognized the value of its distribution network and pervasive locations and made the strategic decision to expand into retailing products and offer more services to consumers and small businesses.
To help La Poste achieve its goals, we combined our experience in postal, financial and retail services with our IT expertise in change management, financial systems and complex SAP implementations.
A public transformation
CSC’s approach was to transform the operation using a business process redesign based on a service-oriented architecture. Over a three-year span, we designed a common core model and repeatable business processes to deploy the solutions.
The rollout included implementing business solutions such as SAP Retail, the SAP Netweaver Business Intelligence framework, Informatica and Axway.
Above all, La Poste was looking to maintain a uniform interface between all its postal entities. With more than 300,000 employees, La Poste ranks as the second-largest employer in France, and its distribution network, L’Enseigne La Poste, has more than 17,000 points of sale spanning some 100 districts, as well as overseas territories.
Challenges included putting a system in place that could handle a massive volume of daily transactions that needed to be recorded from each of the sales channels. With more than 10 terabytes of data on the ERP side and another 10 terabytes for the data warehouse, the project is believed to be one of the largest SAP implementations ever attempted in Europe. The system is accessed by around 4,000 La Poste users in procurement and 1,500 in accounting.
The chief business goals were to improve customer relationships, develop the commercial business and increase economic performance. A key success factor was CSC’s experience with retail-based SAP architecture. “The group chose SAP for its functional richness, guaranteed continuity and robustness; but we also had to choose the module, and CSC immediately understood the nature of our distribution network,” says Pierre Soussy, L’Enseigne’s program director for the project.
The results have been nothing short of spectacular. La Poste has been successfully transformed from a heterogeneous public administration model to a homogeneous retail network. The SAP solution has centralized key business functions, and for the first time, the postal distribution network has clear visibility of purchases, sales and accounting from all locations. Most importantly, local purchasing data has been automated and is being reported at a national level.
The standardization of end-to-end processes and adoption of best practices has also had a positive impact. Management and accounting cycles have been successfully aligned, the time needed for closing financial statements has been reduced, and business productivity has improved. For example, sales figures are now reported on a weekly basis instead of monthly.
Aligning the sprawling business on common SAP systems has resulted in savings of more than 5 million euros per year on IT maintenance. More than 20 IT systems, many of them obsolete, have been retired and replaced by SAP enterprise, customer relationship and business intelligence modules. More than 100 local district databases have been merged into three common SAP databases, and some 300 interfaces have been reduced to around 170.
The solution leverages the latest in SAP technology, including supplier invoice management with optical character recognition and business workflow.
“The functional departments played a key role in the management of change, thanks to a very thorough and participative approach, which made it possible to improve processes and working methods even before the new IT system was put in place,” explains Cécile Révillard, accounting manager at L’Enseigne.
Technology as an enabler
La Poste now offers more retail products at its locations, along with a wider array of banking services. The essence of the project was to create a system that could handle a complex network of transactions while keeping the accounting process as smooth as possible.
Michel Rebillard, who managed the project for CSC, says, “Despite the scale of the task, the challenge has always been to safeguard the overall coherence of the solution and to reconcile needs – without devaluing them – with the standards of the software and volume constraints.”
In the end, La Poste views technology as an enabler for achieving its business goals. “The implementation of SAP was essential, but technology should remain a means to realize our transformation,” says Stéphane Zakarian, CFO of L’Enseigne. “This success was made possible by the mobilization of everybody around strong guiding principles, and – thanks to the competence and availability of our partners at all levels – CSC aligned itself perfectly with this approach.”