Global Engineering Collaboration and IP Protection at Hilti Daniel Draes, Hilti AG PLM Innovation 2012, Munich, 23.02.

1. Global Engineering Collaboration and IP Protection at Hilti Daniel Draes, Hilti AG PLM Innovation 2012, Munich, 23.02.2012

2. Agenda • The Hilti Group • The PLM Project • IP-Protection and Global Collaboration • Long-distance Collaboration

3. The Hilti Group

4. Hilti – a worldwide presence • Founded in 1941 in Schaan, Principality of Liechtenstein • One of the leading global companies in providing products, systems and services to construction professionals • Present in more than 120 countries on six continents • 2010: 20,000 employees, 3.5 billion EUR turnover • More than 60 nationalities at Group Headquarters in Schaan, Liechtenstein • Direct sales model • 2003 winner of the Carl Bertelsmann Prize for outstanding corporate culture

5. System solutions for construction professionals

6. Worldwide production network Main R&D Locations

7. Hilti IT Strategy:Creating enthusiastic customers in partnership with Hilti Business • Reliability • In-house competence • Industrialization • End-to-end engineering & execution • Service level agreements • Agility • Anticipatory planning • Service orientation • Solution from stock • Agile Architecture • Selective out-tasking One Global IT Team Standardized Client Environment One integrated Business Application Environment High available, performing computing and network setup Cost and Value Management: IT Productivity and enabled Business Productivity

8. Hilti IT – Global Processes and Data (GPD/H2) • Globally harmonized Processes and Data (GPD) + centralized SAP ERP environment (H2) = GPD/H2 • One central SAP ERP, SAP ERP HCM, SAP NetWeaver BW, SAP CRM, SAP NetWeaver PI, SAP NetWeaver Portal, SAP APO, SAP eWM, SAP CUA, SAP SolMan system for all GPD/H2 organizations • >95% of all business transactions worldwide on GPD/H2 • Centralized IT organization with approximately 370 people, managing ~1000 servers globally; 2 Data Centers in Liechtenstein • Global 24/6 service from three locations in US, Malaysia, and Liechtenstein for operations, IT infrastructure, and network • Strong application support and in-house development • Local on-site support only for Office Automation

9. Agenda • The Hilti Group • The PLM Project • IP-Protection and Global Collaboration • Long-distance Collaboration

10. PPM Process Landscape System / Application Landscape • CAD: NX (homogeneous through all organizations / departments) • PDM: CID (in-house developed global PDM System) • ERP: SAP R/3 (ERP 6.0), single client Processes were described and established down to level 2 PDM/PLM: The initial Situation

11. Roadmap and high-level Scope Vendor Evaluation Prepare 2007 - 2008 Setup & Test Implementation & Go-Live Process Review; Requirements Def. ICP Implement 2008 - 2010 Functional Enhancements Rollout Process Improvements / Benefit Tracking Harvest 2011 - … Project Vision & Phases Drive PPM Productivity and Operational Excellence in Development through effective and efficient PPM processes

12. System / Application • Directly integrate CAD and all engineering processes into SAP ERP using DSC Engineering Control Center (ECTR) in 11 BUs, 9 Plants, 6 countries Data Management Production Equipment ProductVariants Sales Items Phase Out Product Development Professional Service ProductionPreparation Engineering Change Management Processes Collaboration Support Processes Standards PDM/PLM: Scope

13. Implementation Partner • DSC Software AG:Main implementation partner • SAP (CH) AG:Selective consulting support • joinApps AG:Print & Plot • Infosys Technologies Ltd:Support for Vendor Evaluation

14. Success Factors • Close collaboration between business & IT • Intensive Stakeholder Management • Manage Expectations: No immediate high-value payback • Fix time & fix budget, manage Scope • Carefully select solutions & implementation partner • Avoid big-bang – a parallel operation of two systems is possible • Develop requirements along pilot installation (usability is key!)

15. Carefully Select Solutions and Implementation Partner • Market screening with strong support from independent consulting partner (Infosys)  Build short list • Request for Information (RFI) following formal proven approach from consulting partner • Pilot installations of short-list candidates in our environment; assessment workshops with experienced business participation • Assessment of vendors’ capabilities to adjust to Hilti-specific requirements (two weeks “Proof of Concept”) • Structured assessment considering the dimensions solution and vendor maturity, functional coverage, strategic fit (including IT-strategy), total cost of ownership (TCO) , and “vendor behavior”

16. Avoid Big-Bang: Run Global PDM Systems in Parallel All PDM Product Data Product Data Phase 1 BUs • Decisive: • Scope calculation minimizing overlap region • Uniquely assign data ownership (keeping overlap region in old system) • Execute frequent delta-migration (old to new system) Phase 2 Data used in mul-tiple products / projects AtGo-LivePhase 1 Phase 1 Migration Phase 1Data New Data created byPhase 1 BUs New Data Phase 2 BU’s PeriodicalDelta Migration AfterGo-LivePhase 1 Old DataPhase 1BUs Data Ownership Old PDM System New PDM System

17. Usability: SAP for Engineering Departments

18. Agenda • The Hilti Group • The PLM Project • IP-Protection and Global Collaboration • Long-distance Collaboration

19. IP-Protection and Global Collaboration Requirements • Engineering Data (CAD-Data, Drawings, other Documents, BOMs, certain Material Data, Change Documentation) must be protected from visibility outside Europe (except explicitly approved) • Re-usage of parts must be possible also across international locations • Global engineering projects across international locations must be possible (especially between Europe and Asia) • Data needs to be protected by default • It needs to be possible to make data visible on demand

20. Situation in SAP ERP 6.0 (w/o PLM 7) • Relevant objects do not contain organizational assignments (i.e. protection via plant, sales-org., company code, etc. is not available) • Access control lists (ACL) are available on documents but do not deliver suitable solutions (AND: are not available on material, BOM, ECM) • The field “authorization group” is available on all objects, but w/o logic • Implementation of logic controlling the authorization group values on all objects depending on certain parameters (business logic) • Setup of authorization roles using the auth. group values • Improvements with PLM 7 ??

21. Usability of Authorization Assignment • Avoid complicated automation • Rules like “all parts in a certain project” do not offer necessary security (who can assign a part to a project?) • Transparency on visibility settings improves communication • Manual assignment (supported by easy mass-functions) controlling who is allowed to change visibility settings and also supports an easy log of who has changed visibility • The new process has been adopted very fast by business and is not seen as a burden (but rather as a good support of business)

22. Transparency on visibility settings

23. Agenda • The Hilti Group • The PLM Project • IP-Protection and Global Collaboration • Long-distance Collaboration

24. Background: CAD-Integration into SAP ERP • All meta data managed in SAP ERP • File storage: Content Server (CS) of SAP Knowledge Provider (KPRO) • Clients communicate to SAP ERP via RFC • SAP ERP returns HTTP addressesof files; clients fetch directly from CS • DSC Filespace replaces local storageof checked out working versions • Convert service generates neutral formats for archive/print/plot

25. Multi-Site Implementation • KPRO content/cache in major sites • as DSC Filespace also caches, KPRO can be skipped in sites with good network connection

26. Long Distance Collaboration • Functionality of SAP KPRO: • At check-in, CAD-files are moved into nearest SAP Content Server; existing copies in all caches are invalidated • With next access, files will be copied to the cache at requesters location • No possibility to influence SAP Caching behavior • Challenge: • Access in location B immediately after check-in in location A causes a file transfer from location A to location B • A long-distance WAN between A and B results in substantial waiting times for this transfer • The reason for the waiting time is in-transparent to the user

27. The concept of cheap vs. expensive • A new storage category-customizing table defines per site, which KPRO repository is near-by (= cheap) and which is far away (= expensive) • The data-fetch mechanism of the ECTR is enhanced by the following logic: • If the local Filespace contains the latest version, it presents it to the user • If not, the ECTR checks the repository • If fetching is cheap, ECTR requests the file from the KPRO • If fetching is expensive, ETCTR displays a pop-up to offer the user the choice between expensive collection of the latest version, or loading of the currently stored (outdated) version • An over-night sync-job preloads the local filespace to eliminate waiting times

28. Take away • SAP ERP out of the box does not offer sufficient engineering data protection or global collaboration support • User exits allow to develop authorization mechanisms which comply to company specific data protection requirements • Global collaboration can be improved by applying logic into the DSC-Filespace component • The enhanced logic of cheap vs. expensive is meanwhile standard in ECTR

29. Thank you for your attention.