Eaton uses Oracle to centralize financial services in South America

When the idea of creating a shared financial service center was presented to the corporation headquarters in the United States, the Brazilian subsidiary of Eaton received the green light at once. After all, the company, which operates in over 125 countries and is one of the biggest manufacturer of electrical, hydraulic, automotive and aeronautical systems components in the world already had two such service centers. One attended to North America, another to Europe. Brazil would be the third and should provide services not only to all the company’s units in the country, but also to all of South America.

Thus Eaton’s South America Service Center (SASC) project was born, which began to be implemented in 2004, with consultancy and partnership of NineCon, and was concluded in just two and a half years. “It was a project for five years, because it involved a very complex work of system integration and standardization”, says Nildo Bortoliero, director of SASC and responsible for its implementation.

The great challenge

To start, each business unit of the company (there are then in all, throughout Brazil) had its own accounts receivable and payable, accounting, payroll and equity control system. In addition, another great challenge was in the growth of Eaton itself, which occurred mainly from the purchase of other companies - worldwide and in Brazil. “There was the need to take different systems and integrate them into one”, says Bortoliero.

The platform chosen for this was the Financials module of the Oracle E-Business Suite. This Oracle system was already being used by the Transmissions division – Truck Unit, which is located in Valinhos, in the São Paulo interior, and represents Eaton’s biggest business in South America. For this very reason, the implementation of SASC started through this unit, which was its first client and also supplied the personnel (from the financial area), who would join the initial team of the project. Besides them, this team had key users from the various divisions of the company, with consultants from Ninecon and with a project manager.

The first step was to create an environment based on the Oracle platform to which the financial information of the various systems used in the various Eaton units could be brought. “The objective was not only to consolidate the information but to also perform all activities in the financial area in the SASC", states Bortoliero. This includes the accounts receivable and payable, accounting, payroll, fiscal control fixed asset and export and import operations.

Installation of the new environment required specific interfaces, required for the integration. Some of them are standard from Eaton and were brought from the headquarters itself; others were developed in Brazil - to meet the fiscal and legal requirements of the country, through the IT area of the company, together with Ninecon´s consultants and the SASC project team. Oracle also participated in the development of some interfaces intended to integrate its system to that of other suppliers – like Magnus, from Datasul, and MFG/Pro, from Qad.

According to Bortoliero, this partnership work was one of the main reasons of the implementation`s success and of the short time in which it was achieved. “The business and system teams worked together in the project design, in the choice of solutions and definition of resources”, he states. “And Ninecon was a differentiated and very important partner that was involved in the project from the beginning and with the same dedication as our staff”. Bortoliero highlights that the knowledge of Ninecon’s consultants, not only of the Oracle platform but also of the financial business area, was also fundamental.

Expansion to other countries

The formula adopted was so successful that, today, the SASC is regarded as a benchmark of the Eaton group in the accounts receivable area, with above average performance. It is also the most complete service center of the corporation, with the provisioning of all services in the financial area – including processing of import and export operations.

Most of the activities are generated by the purchase and sale transactions. In invoices alone, for instance, 250 thousand were issued in 2006.

When a unit issues an invoice, the data goes directly to the SASC, which is responsible for charging the customer, for the fiscal records and recording of the operation in the accounting books. In the case of a purchase invoice (of materials or services), the center conducts the entire fiscal processing, of accounts payable and accounting.

“The main benefits are standardization, integrity and control of information”, states Bortoliero. “In addition, on passing the financial services on to SASC, the company business units have more time to concentrate on their activities".

In September 2005, the SASC obtained its own building, located within Eaton’s facilities in Valinhos. Today, 51 people work there. In 2008, the service center will also start providing services to Eaton’s divisions in Argentina, Chile and Venezuela.

• TECHNICAL FORM


Customer: Eaton Brasil
www.eaton.com.br

Profile: Manufacturer of products for the Automobile Industry, hydraulic systems, equipments and parts for aeronautics, electrical components and power distribution systems, products for automobile engines and industrial filtration.

ERP System: Oracle E-Business Suite - ERP

Project: 
- Implementation of the South America Service Center (SASC), based on the Oracle environment

- Development of interfaces for integration in this single and standardized environment of the information extracted from various systems used in the various company units.


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