fenaco: Swiss agricultural cooperative implements SAP Central Finance

With a turnover of over 7.2 billion Swiss francs and more than 11,000 employees, the fenaco cooperative is one of the largest companies and private employers in Switzerland. Well-known brands such as UFA, RAMSEIER, Volg, LANDI and AGROLA are part of fenaco. But despite its size, fenaco’s cooperative structure means it is highly decentralised. With over 40,000 members, including more than 23,000 farmers, it is a key player in Switzerland’s agricultural and food sector.

Rebuilding the IT architecture of such an organisation is no easy task given this structure – especially regarding its financial system. On the one hand, fenaco wanted to reduce the complexity of their systems and processes, and a group-wide yet centralised reporting solution. On the other hand, however, the members’ ERP systems had to be retained due to the high degree of customisation.

“As decentralised as possible, as centralised as necessary – that was the directive given to us by the management and the Board of Directors of fenaco on the very first day,” says Peter Harder, Managing Director Switzerland at GAMBIT Consulting. “From a purely technical perspective, the sheer number of ERP systems and the separate FI systems were, of course, a real challenge,” says Peter Harder.

“We began by conducting a preliminary study to assess what was feasible in order to achieve fenaco’s objective: namely, to establish a centralised financial system as the future financial platform for corporate reporting and to streamline processes and systems, whilst retaining some decentralised solutions,” says Peter Harder.

The preliminary study was conducted in six months and included, among other things, a large number of strategy interviews with senior management, workshops and further interviews on reporting, processes and the legacy system. Furthermore, the consultants analysed the technical requirements, processes and data structures and designed and evaluated possible target system architectures.

Peter Harder: “From the outset, there was an intensive exchange within the Process Change and Advisory Board – as well as directly with the CFO of the entire group. For the success of such a project, this close contact and regular dialogue with top management are hugely important. On the one hand, this ensures that strategic requirements are taken into account as effectively as possible. On the other hand, it provides the necessary support for the project within the company – which is absolutely vital for the acceptance of such a transformation project within the organisation.”

The key finding of the preliminary study was that fenaco’s requirements can be met in every respect. A centralised financial system can be built on the basis of SAP S/4HANA – a system with which the group will be able to handle operational financial accounting, reporting and consolidation in real time. At the same time, the SAP and non-SAP source systems (inc. Bison Process systems, Bison Trading systems and other third-party systems) can remain in place.

On a technical level, this means: the experts integrate the ERP systems directly into a centralised financial system via middleware as part of the project. To this end, they transform the existing interfaces between the ERP and local finance systems so that they can be connected to the centralised financial system.

The information resulting from goods movements and invoices is then replicated into the SAP Central Finance system. However, full control over merchandise management processes remains with the source systems. Consequently, the previous local accounting systems become obsolete and are replaced by the new central system.

To harmonise the local ERP system’s data, fenaco has developed its own platform in collaboration with its internal IT department. This platform enables the harmonisation of accounting documents. The data is then transferred via middleware to the centralised financial system on a central SLT server (SAP Landscape Transformation Replication Server).

fenaco can thus fully achieve the project objectives with the new financial platform: replicating data from the ERP systems into the centralised, unified financial system increases transparency. Furthermore, fewer manual steps are required and the coordination effort is reduced. Last but not least, the complexity of the system landscape is reduced – and flexibility increases. 

“It was very important to us that the GAMBIT experts were able to assure that the pilot project and the roll-out across the entire group was 100 per cent feasible – both from a technical perspective and with regard to our resources,” says fenaco’s Patrick Schärli. “This also applies to the search for the ideal implementation process. We addressed this together at an early stage and developed a strategy which has subsequently proven its worth,” he adds.

The focus of all possible implementation paths presented by GAMBIT was on a phased approach. This is characterised by short design phases, the gradual accumulation of experience and the rapid roll-out of partial implementations. In addition, sufficient time has been set aside to train staff and familiarise them with the new system.

Following the decision to adopt a centralised financial system based on SAP S/4HANA, the first few months of 2021 saw important internal preparatory work for the pilot project. Internal specialists prepared the source systems and interfaces for the subsequent migration. In addition, those responsible planned the bidding for the pilot project, for which GAMBIT was awarded the contract.

“For the pilot project, starting in early July 2021, we worked together with the fenaco project team to set up the centralised financial system. We selected three representative companies, each characterised by different ERP systems,” explains Sebastian Schmitz, who managed the fenaco project at GAMBIT Consulting. The three companies – and, in a second phase, the fenaco parent company as the central entity – then gradually went live between 2022 and 2024.

During the pilot roll-out, the SAP experts set up all operational processes for the participating companies which had previously been operating in a non-SAP system. These included, for example, accounts receivable, accounts payable, asset management and financial statement preparation. fenaco was already able to utilize intercompany reconciliation for these companies, which had been implemented in the centralised financial system.

“In particular, the harmonisation of GP master data with SAP MDG as part of the pilot was, in my view, a tremendous achievement. It required a great deal of specialist knowledge and meticulous work to align the MDG system with the multitude of different source systems used by the members,” says Sebastian Schmitz. “But our data migration team – working together with fenaco – really did a firstclass job here. The team has demonstrated how well it can handle even the most complex challenges.”

“Overall, thanks to the outstanding work of our entire team at fenaco and our partner GAMBIT, we are now well on track with our programme and have been able to lay the perfect foundation for the roll-out currently underway across the group,” said Patrick Schärli of fenaco.

“With the centralised financial system – and that was and remains our primary objective – we will become faster and more transparent. With this project, we are laying the foundations for a digitalised future within the fenaco LANDI Group, and with SAP, we have certainly found the right solution. For fenaco, a project of this kind is a first and will influence the way we work together in future.”