Customer Case Study

KION GROUP AG

The Company:

TRANSFORMING PROCUREMENT: HOW KION LEVERAGED QAD SRM FOR GLOBAL EFFICIENCY

KION Group AG, headquartered in Frankfurt, Germany, is one of the largest manufacturers of material handling equipment and supply chain solutions in the world. It was established in 2006 amid Linde AG’s restructuring and has evolved into a multi-brand business offering not only industrial trucks, forklifts and warehouse equipment, but also intralogistics, warehouse automation equipment and other supply chain solutions. KION’s brands include Linde Material Handling, STILL, Dematic, Baoli, Fenwick and OM.

The company has warehouses, production facilities and distribution centers in more than 100 countries and with more than 1.8 million units deployed worldwide, KION’s products have become a crucial factor for modern supply chains. It is the largest manufacturer for industrial forklift trucks in the EMEA region and is one of the world’s leading providers of warehouse automation solutions. 
COMPANY HIGHLIGHTS
Company
KION Group AG
Headquarters
Frankfurt, Germany
Industry
Industrial Manufacturing
Products
Material Handling Equipment
Solutions Utilized
QAD SRM (Supplier Relationship Management):
Supplier Data Management
Sourcing
Auctions
Collaboration

 



The Challenge:

MANUAL TASKS AND A LACK OF STANDARDIZATION HINDER GLOBAL PROCUREMENT EFFICIENCY AT KION

Operating a business of any size is complex in an era where supply chain issues, geopolitical tension, emerging regulations and other forms of disruption have become the new normal, but this is especially true for a global organization like KION that has facilities in more than 100 countries. Modern manufacturers must have strong relationships and clear communication with suppliers at every tier to enable a proactive response to dynamic market conditions but they can’t achieve this level of connectivity alone.

“We have factories around the world in different regions, so that means we need to have a well established supply base to ensure that we are able to cope with the challenges of today's world with supply chain disruption and also geopolitical threats,” explained Gero Bernhardt, Director of Digital Procurement at KION. 

“For the mitigation of supply chain and business risks, we need closer integration and easy collaboration with our suppliers,” added Jens Brethauer, VP of e-Procurement & Digitalization at KION.

KION, like many manufacturers, faced challenges managing its robust supplier network. The team relied on email and phone calls to communicate with suppliers but the approach became insufficient as KION’s operations grew in scope and complexity. The process was labor intensive, making it difficult for stakeholders to share information and collaborate in real time, resulting in inefficiencies. 

Reliance on manual processes also made it difficult for KION to create sourcing events quickly and efficiently. KION wanted its buyers to focus more on negotiating with suppliers and less on administrative tasks but they needed a solution that could streamline and automate the sourcing process for direct materials.

Managing supplier capacities and performance was another significant challenge. KION needed a system that could handle supplier interaction processes for capacity evaluation and performance rating and classification. The ideal solution would make it easy for stakeholders and business partners to collaborate on performance-related issues, ensure a high level of deliveries and enable a rapid response to potential problems.

“The main motivation for searching for an advanced and dedicated solution was reducing the manual effort, increasing efficiency, accelerating collaboration, and also, finally, to save money,” continued Brethauer.

“QAD SRM changed our work life definitely because there's now much more time left to negotiate better prices and save costs.”

Jens Brethauer, Vice President Digital Procurement & ERP systems, KION



The Solution:

KION TRANSFORMS GLOBAL PROCUREMENT WITH QAD SRM

KION selected QAD SRM (Supplier Relationship Management) and its Supplier Data Management, Sourcing and Collaboration capabilities to enhance procurement operations and supplier collaboration. The solution quickly became an essential component of KION’s ongoing procurement transformation, enabling the company to standardize processes across its global footprint.

“We want to offer one central place where we maintain data, where we are connecting all the satellite solutions that we have out there and really offer a homogeneous process framework, so that means having the same capabilities everywhere around the globe,” stated Bernhardt. Whether someone is conducting a request for quotes (RFQ) in Asia or Mexico, the process should be the same — and now it is with QAD SRM.

QAD SRM has also transformed the way KION manages suppliers. The team has replaced inefficient emails and phone calls with QAD SRM tools and features that facilitate real-time data exchange and communication, making it easy for the team to collaborate with global suppliers, improve decision-making and unlock efficiencies in its procurement processes. 

“QAD SRM is a common application for all process partners, for engineering, quality, procurement, logistics, but finally also for the supplier. This is the biggest advantage,” explained Brethauer. 

“We selected QAD SRM based on the tools and the features which we need, but also the exceptional and applicable user experience. The user acceptance was one of our key decision drivers for choosing the solution,” continued Brethauer.

“Our buyers like QAD SRM very much because they can focus now on the real work to negotiate with suppliers rather than creating and conducting sourcing events. This is the biggest change — saving time and making it easier to conduct sourcing events,” said Bernhardt.

“We needed a user-friendly and intuitive environment,” agreed Christian Prenzel, Solution Expert at KION. “This was one of the main focuses of our search, and the guided wizard within the solution makes it even easier to accomplish our work. This feature has allowed KION to change a lot in the system by ourselves and respond more quickly to new requirements.”



The Benefits:

QAD SRM DELIVERS A 90% REDUCTION IN RFQ CREATION TIME AND ENHANCED DECISION-MAKING

The global implementation of QAD SRM has enabled KION to standardize its procurement processes across all regions and reduced the average time it takes to create an RFQ by more than 90% from several hours to just a few minutes. Now, the team has all relevant data and information in one place and can quickly create and send RFQs directly to suppliers.

“We have faster processing times for the RFQs as every relevant contact person from different departments is involved,” explained Prenzel. 

“QAD SRM changed our work life definitely because there's now much more time left to negotiate better prices and save costs,” added Brethauer. 

The savings have been significant. In one circumstance, KION used QAD SRM’s Auctions solution to achieve a 32% savings. KION’s global team has been quick to embrace QAD SRM’s user-friendly interface and so have suppliers. 

“Suppliers want to do business with us so, for them, it is a good way to ensure that they are part of our world. One of the most appealing features for a supplier is really having a central way to communicate,” explained Bernhardt.

The integration capabilities of QAD SRM have provided seamless upstream and downstream connectivity with KION’s ERP system, facilitating greater collaboration and the flow of information between procurement, suppliers and other internal stakeholders. 

Plus, KION has found a partner it can rely on with the QAD Customer Success organization and continues to work with the team to optimize the solution. “We are closely aligned in our intention to strive for success together with QAD Customer Success, which is actually a benefit we’re missing from some other solution providers,” said Brethauer. “Our relationship with QAD Customer Success is direct and open-minded.”

KION is also in the process of migrating to the QAD Cloud with the support of QAD Professional Services. The company chose to upgrade in order to access the latest features and further improve the flexibility and responsiveness of its procurement processes. 

“One of the benefits of working with QAD Professional Services is communication and transparency on the status of the project. We have close exchanges with the team behind this exercise,” explained Bernhadt. “It’s critical for us to understand where we are because this is a big move for us. What we’re experiencing is a feeling of safety that everything that we did is not lost and everything that we will do is managed in a great way.”

“We have built a very close business relationship with QAD. Our goal is to get the best solution from the best provider, not waiting for each upgrade every time and then testing the release upgrades,” concluded Prenzel.

“Suppliers want to do business with us so, for them, it is a good way to ensure that they are part of our world. One of the most appealing features for a supplier is really having a central way to communicate.”

Gero Bernhardt, Director of Digital Procurement, KION

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