Illumiti SAP Business One Case Study: TerraCycle

How a Proven ERP Solution Helped Manage a Story of Waste Management Innovation

When topics like waste management and recycling broach our collective thoughts and intersect our everyday discussions, there’s always a tremendous amount of optimism about our ability to address one of the biggest, if not the most important global issues of our times. Globally, we’re poised to make the most significant decisions ever and take a step forward to making significant change in the fight against wastefulness. We need to turn discussions into actions and create impactful recovery drivers that will enhance economic development.

As we continue to generate waste, the opportunity to embrace change and invest in a better recycling infrastructure and technologies is now. And with our personal hand included in supporting the global waste-to-value economy, there’s no shortage of things we can do to lead the way. Using the tools at our disposal to accelerate progress in this space is a start; using tools to manage innovative enterprises effectively and efficiently is just as important. After all, recycling has become as American as apple pie.

“We’re committed to creating a significantly cleaner, better world. And while we continue to find ways to reuse and eliminate waste, we need the right insights and solutions to maximize how we run our business by developing relationships with key partners who understand our ambitious goals and needs.”

Kevin Flynn, EVP Operations, TerraCycle

Background

In 2001, the idea to help eliminate waste by making quality fertilizer from food waste itself was born. Today, TerraCycle is an innovative waste management company with a mission to eliminate the idea of waste altogether. Operating in 20 countries, TerraCycle partners with leading consumer product companies, retailers, and cities to recycle products and packages, from dirty diapers to cigarette butts, that would otherwise end up being landfilled or incinerated. In addition, the company works with leading consumer product companies to integrate hard to recycle waste streams, such as ocean plastic, into their products and packaging.

TerraCycle’s new division, Loop, is the first shopping system that gives consumers a way to shop for their favorite brands in durable, reusable packaging. With more than 200 awards for sustainability and over $44 million donated to schools and charities since its founding, TerraCycle is a game changer; the company was named #10 in Fortune magazine’s list of 52 companies Changing the World.

But driving environmental change doesn’t materialize easily. With a social enterprise delivering industry-leading solutions and tackling issues from many angles, TerraCycle needed to tackle the technological issues required to run an advanced—and continuously progressing—company.

The Insights

What challenges can necessitate change with how a company manages business-critical processes when it’s trying to change the world? When it’s the only company of its kind, what kind of digital innovation can best support it?

Considering that its in an advanced industry where companies need to be nimbler and more accelerated at decision making, TerraCycle’s level of sophistication with how it could manage its business processes seemed low. The complexities of a rapidly growing company and inherent inefficiencies pertaining to running upwards of 34 different databases and various local currencies and taxes, necessitated the need for change.

• TerraCycle was very familiar with SAP, especially from a finance management perspective, and wanted a solution that would support the overall strength of the business.
• There was a solid understanding of how internal changes can impact the flow of how a business runs—change with the implementation of a new system can bring fresh approaches and consolidate several local financials, versions, and transactional systems into one report.
• There was also a collective belief that a more robust Enterprise Resource Planning (ERP) system was needed—moving from their current systems to SAP Business One was be the best option from an accounting need and to satisfy an acute need for better inventory tracking and database management, all with a single line of sight.

The Challenges

Challenge: TerraCycle utilized an essential add-on with much needed functionality that was already built into pre-existing source code, effectively locking TerraCycle out of an upgrade. Illumiti needed to determine what elements of the add-on were truly necessary and what were considered oversold features, so that they could continue to scale and grow efficiently.

Challenge: Working with over 30 SAP company databases running on different accounts, Illumiti needed to determine the best way to consolidate complex global financial reporting systems and map numerous accounts; we needed to reimplement databases and standardize the chart of accounts and enable consolidated reporting tools.

Challenge: Reimplementing meant handling the number of databases and coordinating the cut-over activities for all companies. Illumiti needed to schedule and prioritize cutover activities, establish a rolling window of downtime for each company, and make use of procedural steps—closing and finalizing as many transactions as possible to reduce cutover activity transaction volumes, especially considering the number of companies.

The Solution

Although we were not involved with the initial implementation, the project was treated in the similar fashion as any new implementation we would manage—in essence, this project was technically new in so many ways. With consistent communication channels open throughout the duration of the project, we were able to build a strong partnership with TerraCycle. All requirements were gathered using existing configuration and knowledge of TerraCycle’s previous SAP implementation and used to create a new blueprint. Additionally, we were able to:

• Implement new databases according to new localizations, and we quickly rolled them out seamlessly with financial reporting.
• Using SAP Business One Integration Framework efficiently and effectively, including CRMs and web shops.
• Gain organization buy-in throughout and building high levels of positivity to help us all make better business decisions, adding ongoing structure and stability.
• Eliminate manual process and make automation paramount to the process to help gain efficiencies and uncover better business workflows.
• Make use of SAP’s solution packager tools to migrate as much of the existing configuration from each company without migrating existing CoA; the new CoA was implemented and changes from the old baseline configuration to the new baseline configuration were implemented. Following an extensive period of user testing, cutover activates for over 30 databases were completed, and opening balance and transactions were migrated to the new companies, all of which were staggered in priority sequences.

TerraCycle needed a partner that had the patience to educate them about change management, while providing leadership and a higher level of understanding as to why they were doing what they were doing.

The Results

We were impressed by the way TerraCycle approached this reimplementation project, considering the inherent difficulties associated with this type of project – 30 companies had to be completed simultaneously; the amount of planning, patience, and understanding for both Illumiti and TerraCycle was substantial.

“We found the experience of working closely with Illumiti to be critical to the successful implementation of SAP Business One,” said Kevin Flynn, General Manager, TerraCycle. “They took the time to thoroughly understand our unique business and helped us make the right business decisions. With their breadth of knowledge, innovative services, and capacity to set-up business-critical process, we look forward to our continued growth with Illumiti as partner integral to our success.”

Some of the key takeaways from this project and our relationship with TerraCycle:

• We’ve introduced a number of essential enhancements:
  • Five global e-commerce stores integrated with logistics processes to track movements of reusable assets.
  • Tax reporting, banking, and 3PL logistics integrations.
  • Three active tax integrations for different countries.
  • GL import for Excel template integration.
  • Implemented additional add-ons. 

• TerraCycle has rolled out new lines of businesses rapidly with complex integration needs associated with each; with each project and new companies acquired and implemented, this collaboration has followed a similar blueprint process to ensure the use of existing baseline configurations.
• TerraCycle has benefitted from a single, ongoing technology partnership with the breadth of knowledge and in-depth understanding of their business necessary to effectively tackle issues quickly.

“It’s difficult to imagine doing what we do without SAP Business One. Plus, with Illumiti’s talented people and the skillsets they brought to the table, and their flexibility and aptitude to assist quickly, were all critical to TerraCycle successfully launching the solution.”

Kevin Flynn, EVP Operations, TerraCycle

As with every customer, Illumiti strives to continually advise and rationalize TerraCycle on the cost versus benefit of all ideas to prevent frivolous spending. We assess the value proposition of performing the work we propose and ensure they are aware of what the payback period of the project might be.

With a collaborative relationship, we’ve been better able to foster open dialogue to help TerraCycle improve their enterprise with our solutions. By bringing new functionality and technologies, they ultimately benefit, grow, and become more resilient and agile to new challenges. Working with TerraCycle is a pleasure, helping them re-imagine what could be and helping them evolve their business with a solution that’s more robust and improves the end-user experience. We’re proud to be a part of this ongoing journey, working with TerraCycle to understand their planned growth and anticipate what may be needed to support their new business and streamline existing processes.

To learn more about TerraCycle, visit terracycle.com.