Business challenge

To build and maintain large-scale infrastructure, engineering firms need quick access to the best people, resources, materials and knowledge. How could Grupo TDM facilitate national growth?

Transformation

Grupo TDM enlisted the help of IBM and SAP to revolutionize and digitalize its mission-critical activities, transforming its business efficiency and unlocking huge potential for growth.

Results

50% faster

information access speeds up decision-making

15%

cost savings achieved thanks to cost-efficient and resilient cloud solutions

42%

reduction in response times, enabling faster service delivery

Business challenge story


On the road to better-quality information

Latin America is bursting with infrastructure projects: new mines, roads, dams and power plants are helping to build prosperity for millions of people. If you have ever driven on Brazil’s picturesque roads, or used power generated by hydroelectricity in Mexico or Chile, you may owe your comfort to Grupo TDM, which provides high technology construction materials, installation services and engineering expertise.

“With IBM’s expert planning and smooth execution of the SAP S/4HANA project, we completed a textbook deployment of a truly transformative solution.”

—Hernán Arízaga, Corporate Manager, Grupo TDM

Grupo TDM is one of only a handful of companies in Peru that offers integrated construction solutions for infrastructure projects, as Hernán Arízaga, Corporate Manager at Grupo TDM, explains: “There are several firms in the country that deliver specialist construction services. Instead, we offer a much more comprehensive range of solutions, which means that we can attract a much larger, more varied customer base.

“In the past ten years, we have been expanding across Latin America, and continue to grow. To be able to devise a truly successful growth strategy, we need to keep our finger on the pulse of the business, pinpointing the most promising areas for further expansion. We want to find out which customer segment displays the highest demand, in which areas we should open new plants, or how we can improve our shipping operations, and boost customer satisfaction. As our company grows, ascertaining our future direction becomes more complex.”

To obtain this insight, Grupo TDM analyzed information from three of its mission-critical areas: sales, logistics and finance. However, collecting the data from multiple independent systems was slow and inefficient, and was at risk of containing significant errors.

Hernán Arízaga explains: “In the past, we could obtain crucial financial data only on the 25th day of the following month, delaying vital business decisions. Slow information delivery also impacted project managers and engineers in the field. If they needed to access, edit or approve vital documents, they had no way of doing so digitally and on-the-go, halting whole projects. When our project managers were back at the office, they needed to work their way through a lot of paperwork, delaying operations even further.

“An additional pain point was our shipping process: we dispatch products from different warehouses across Peru, and had no real view or control over dispatch times, stock availability and requirement at each location. Grupo TDM could not always ensure that customers received their goods within the agreed timeframe or as quickly as we would like, which threatened to tarnish the overall customer experience.”

To make informed decisions that could steer expansion successfully, Grupo TDM needed enterprise-wide information that was accurate and readily available. But how?

Transformation story


Embracing digitalization

Grupo TDM chose to revolutionize its business by creating integrated, digital processes that would synergize every part of the business, from on-site engineers right back to inventory, logistics and manufacturing.

To realize this goal, Grupo TDP defined the information systems architecture that would enable the vision. Hernán Arízaga elaborates: “After an initial phase in which we evaluated and tested a series of ERP platforms, we recognized that SAP was simply on the next level. We were about to embark on a first-time digital transformation of our core business processes, and we wanted the peace of mind you get when you choose a world-class solution like SAP.”

Grupo TDM deployed SAP S/4HANA®, which enables the consolidation of finance, sales and logistics data into a single repository, enhancing data quality and consistency.

To deploy the solution, Grupo TDM sought the assistance of a technology partner, as Hernán Arízaga recalls: “A company like ours requires a well-established, reputable partner. After considering several options, we decided to team up with IBM Global Business Services, as they demonstrated unparalleled expertise with SAP and came up with the most attractive proposal.”

Grupo TDM and IBM® Global Business Services® worked closely to outline the various steps of the project, define the processes, and develop the solution. IBM assisted Grupo TDM in the design of best practices, and brought a wealth of knowledge to the project which enabled the implementation to go live within the budget and time frame previously established. Additionally, the IBM team deployed SAP on the IBM Cloud for SAP Applications, freeing Grupo TDM’s IT team from the burden of managing and maintaining a physical infrastructure.

The SAP solution is helping Grupo TDM to solve a wide array of operational challenges, as Hernán Arízaga comments: “In the past, stock management and product dispatch used to be handled manually by our staff at each site. We had no way of knowing stock levels in our warehouses, and papers risked getting lost or misplaced, causing delays for our customers.

“By deploying SAP S/4HANA, we now have a single, unified way to manage our inventory and the underlying financial data. Using SAP S/4HANA we can easily plan and manage stock requirements in each location, and as a result have dramatically improved our shipping process.

“For example, shipping staff have direct access to order information, enabling them to be faster, more precise and more efficient. We have also achieved full control over product delivery and shipping times, ensuring customers get their materials on time, every time.

“By knowing exactly what we have in our warehouse at all times, we have eliminated the risks and costs of under- or over-stocking, helping us make savings that we can pass on to our customers.”

The SAP S/4HANA solution has radically accelerated information availability, as Hernán Arízaga confirms: “Our financial information is now ready within the first five to ten days of the month—an unprecedented result, considering that we had to wait up to three more weeks in the past.”

With SAP Fiori® solutions, Grupo TDM is also able to access business-critical data on-the-go, as Hernán Arízaga comments: “By leveraging SAP Fiori, employees in the field can reach information in real-time via mobile devices, and move projects forward on-the-go. This was simply unthinkable in the past.”

Results story

Benefits in detail

  • 50 percent faster information delivery and 42 percent reduction in response times help Grupo TDM stay ahead of market demand and plan future business strategies
  • Enables always-on, anywhere access to information, even for engineers in the field, accelerating decision-making processes
  • Boost in customer satisfaction for reliable on-time delivery reinforces Grupo TDM’s reputation as a trusted construction services provider
  • Eliminates data inconsistencies, boosting the accuracy of information for decision-makers
  • Embeds group-wide best practices and forward-looking ways of working, to be leveraged across multiple geographies in support of upcoming business growth
  • Removes the need to monitor, manage and maintain expensive and inflexible hardware systems by introducing secure, cost-efficient and resilient cloud solutions, achieving 15 percent cost savings

Digging out new opportunities for growth

By deploying SAP S/4HANA, with help from IBM Global Business Services, Grupo TDM is now benefitting from verifiable, trusted information available from one single source of truth. The company can obtain unprecedentedly clear, up-to-date views of its complex business, and make strategic decisions based on shared best practices and smarter ways of working—which help to drive international expansion and economic development across Latin America.

Thanks to the SAP solution, information is now available much earlier than before, as Hernán Arízaga confirms: “On average, we have cut the time taken to access enterprise information by 50 percent, and reduced response times by 42 percent. And now that the SAP solutions have digitalized the entire financial process, we can gain vital information within the first five to ten days of the month. This dramatically enhances our ability to shape financial decisions promptly, and build an informed understanding of our processes.”

Additionally, mobile data access using SAP Fiori solutions helps Grupo TDM close off deals much faster, delighting customers and boosting the company’s reputation as a trusted, modern provider of high-quality construction services.

Hernán Arízaga explains: “The solution has helped us transform our logistics operations, with beneficial impact on our customers. We started to carry out regular customer satisfaction surveys, and after the SAP implementation we immediately noticed a significant boost in customer experience scores, especially in connection with the shipping process, with customers assigning an average of 3.75 out of 5 to service quality. Customers obtain the right products at the right time, with the right documentation attached for their reference, enabling them to focus on the complexities of building large-scale infrastructure.”

Improved logistics operations do not only translate in exceptional customer experience; they also mean that Grupo TDM is now well-placed to monitor and plan stocking requirements at each of its warehouses. “Our newfound ability to know the exact number of goods that we need at each location allows us to eliminate any occurrences of under- or over-stocking, reducing waste and helping us to focus on real market demand,” confirms Hernán Arízaga.

Running the SAP solution in the IBM Cloud for SAP Applications brings additional advantages, as the company is no longer faced with managing and maintaining costly and complex hardware. Grupo TDM estimates that moving to a cloud platform has delivered operational cost savings of around 15 percent, compared to maintaining an on-premises infrastructure. Beyond these savings, the company also has full peace of mind that data is kept secure and easily accessible from the cloud at all times.

Based on its impressive success, Grupo TDM is planning on expanding the SAP solution to areas such as maintenance and business intelligence.

Hernán Arízaga concludes: “Thanks to IBM’s expert planning and smooth execution of the implementation project, we managed to complete a truly textbook deployment of what we consider to be an utterly transformative solution. SAP S/4HANA lays the foundations of solid, sustainable growth, and is set to be a key enabler for our planned international expansion and, ultimately, our customers’ growth.”

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About Grupo TDM

Established in Lima, Peru, in 1992, Grupo TDM provides integrated engineering solutions for infrastructure projects, including water proofing, fluid handling and drainage, stability and containment, erosion control, paving and signaling, and road safety, among others. Employing 900 people, the company has been expanding steadily to other countries in Latin America, including Brazil, Chile, Colombia and Mexico.