Dejan Cupać, Director of IT and Technology, MK Group – Adapting to Processes Defined Through Information Systems Should Be a Standard in Business, and SAP Offers Best Practice

Digitization of business processes, integration of document flows and rapid processing of a large amount of information through analysis of business parameters in real time enable faster and easier business decisions. These are just some of the advantages of ERP systems developed by SAP.

The modern SAP S/4HANA system includes basic business processes, primarily finance, controlling, sales and logistics, as well as specific areas, such as production management, plant maintenance, quality management and others. Digitization of business processes brings significantly greater efficiency in business.

Dejan Cupać, Director of IT and Technology of MK Group, which is a pioneer in Serbia when it comes to the use of SAP software, specifically referred to the best business practices that come with the SAP S/4HANA solution. Dejan explains the benefits of introducing information technologies in business, with a special focus on "cloud" solutions, and why this should already be a standard in business today.

The essence is in the use of business software as a service (SaaS), without the need for new investments in infrastructure and maintenance of own resources in the Data Center, which will lead to faster and further development, scalability and flexibility of business.

How do digital technology and innovation help your company to stay competitive and adapt to new trends?

– MK Group, as one of the market leaders in Serbia and the region, uses IT technologies in almost every part of its business. What is most interesting is the application of technology in agriculture, as one of the main branches in which MK Group operates. First of all, I am referring to farming, cattle breeding, production and processing of vegetables and fruits, viticulture, but also sugar production and Carnex, which is the leader in the meat industry. These member companies of ours use digital technologies, various services offered by the MK Group information system and follow all trends in the field of digitization.

Global population growth, climate change, food security and broken supply chains are increasingly putting food care into focus. The changes that these global challenges bring require the application of new technologies in food production. One of the trends in the food industry is digital agriculture. It represents the application of new technologies in the field of production and management of agricultural products.

This means the use of drones, robotic and self-propelled agricultural machines, the use of IoT devices that measure parameters such as soil moisture, temperature, quality and crop growth from the field, perform their acquisition, and through our systems further process that data through SAP ERP.

This allows us to be connected in all our locations, for all data to be transferred and processed quickly and to facilitate management - we monitor and react quickly to climate changes, to the need for irrigation and the inclusion of automatic irrigation systems.

In addition, we have a large Research and Development Center within our Sunoko sugar factory, which enables us to manage the quality of sugar production through the application of technology. There is also precision agriculture, which enables soil quality management.

In what way did cooperation with SAP contribute to the transformation of your business? What do you see as the greatest value?

– In order to process all data related to our business with quality and prepare information that enables the Management to make decisions, we use SAP solutions.

A concrete example is our apple orchard and three Sunoko sugar factories in Serbia, where the entire production is automated through SAP software. In SAP ERP, the entire process is monitored - from the transportation of sugar beet from the field to the arrival at the factory and processing, everything is covered by the information system. We have expanded the digitization of the process through transport management, GPS tracking of the truck until it arrives at the very position in the factory, then automatic measurement of the amount of sugar beet, determination of the quality of the beet (digestion) and further processing in the laboratories, that is, entering the factory, where by processing sugar is obtained. It is about a technological process which is completely covered through the modules of the information system, that is, the ERP system.

The transformation also meant moving to the "cloud “. Why did you make this decision and why did you choose RISE with SAP S/4HANA Private Cloud Edition?

– MK Group is a long-term SAP user and partner. We have been pioneers since 2003, when the first SAP ERP systems were implemented. Two years ago, we made a strategic decision for the company to switch to the "SAP S/4HANA Private Cloud" solution, considering all the advantages of that technologically significantly improved solution, which are reflected in the possibilities of improving existing processes and systems, optimizing costs and efficiency, increasing availability and security data, as well as the speed and flexibility of business.

One of the challenges of maintaining SAP software in our Data Center, the so-called "on-prem" solution, was the complexity of software management. This means that you have to take care of the entire infrastructure, the network, servers, security systems, licenses, access rights, everything that is not the "core" business of MK Group. Our desire was to entrust that work to professionals, and to be the users of business processes, to improve them by moving to "best practice" as a concept that will allow us to make a much faster transition and implementation of ERP solutions in new companies. In this sense, the decision was made that "cloud" is the best solution for our company at this moment.

We have chosen a "private cloud" environment, but at the time of making the decision, the "public cloud" was not available in Serbia. Then we started the process of defining our so-called "model company". This means that we wanted to define standard processes for all member companies within the MK Group, which we call the "model company", and for those processes to be unique for all. This again brings benefits from the point of view of universality, easy maintenance, greater usability and finally using "best practice" designed processes, which SAP recommends as the market leader in the delivery of ERP systems.

What benefits did the solution bring you, what are they reflected in and why would you recommend this solution to other companies?

– What we have realized during the time of using the system is that any automation and digitization of business processes enables higher quality and greater operational efficiency. We focus on current processes, analyze them, do business process reengineering and adapt it to digital form.

Our factories have been operating for several decades and the change of business processes in the form of their digitization and improvement has led to much greater business results. Our production and efficiency are far better today.

The recommendation to all companies thinking in terms of digitization is to focus on their business processes, to work on their improvements with the experts they have in that field. These are companies that do the implementation of information systems or companies that do consulting services on how to optimize business processes and how to implement them in the software that is perhaps the most represented on the market.

We all need to adapt to the processes that are defined through information systems as something that is standard in business, while not complying with local legislation. What is a challenge for all of us are specific production processes, because finance, controlling, sales, logistics are mostly found in all companies, and these processes are easily standardized and arranged, easily managed. The challenge is how to put the production process, which is quite different from company to company, into the format of a standard ERP system.

There is the benefit of SAP, which is implemented in 90% of the largest companies in the world and which offers their knowledge. All the processes that are already predefined in SAP actually represent "best practice" for all of us. Our task is to try to fit our processes into those models, and this is done through the parameterization of the information system. Programming is minimized, that's why we are going in the direction of not having our own development, but to have everything standardized. We do that, because in future we don't want those systems to have high maintenance costs.

The main goal of introducing new systems and digital technologies is to focus on future solutions, on innovations, processes and optimizations, and not on maintaining the existing system. The moment you fall behind on maintenance, you are stalling and falling behind others, and that should be the main message to all companies thinking of introducing some world-renowned solutions. What is the benefit to those companies? In the package, they get both product and processes and improve their own production and their own business.

How do you see the future development of MK Group when it comes to the application of information technologies?

– The only constant in information technology is that change is constantly present. What we see as our future is that we move to "cloud" solutions as much as possible, because this increases business flexibility, system availability and data and business security. Cloud systems are accessible from any location, at any time and from any mobile device. Certainly, data security and an exceptional level of data protection is one of the key benefits of the SAP S/4HANA private cloud solution.

We strive to increase availability, security, and operational efficiency with "cloud" solutions. A message to other companies - if there is an opportunity, choose "cloud" technology, it will enable you to develop faster, scalable, flexible, because you focus on the application of the software, not on the infrastructure itself. The bottom line is software as a service. We buy a service, we deal with our primary activity, and professional companies, such as SAP, which is the market leader, make sure that the software solution is always available to us, as well as that data security is at the highest level and that we have all technological innovations at our disposal in a timely manner.

MK Group d.o.o. Beograd

SAP West Balkans Beograd

MK Group

SAP

Dejan Cupać

business process digitization

ERP system

SAP S 4HANA system

cloud based solution

private cloud

public cloud

IT technologies

implementation of technology in agriculture

automation