The World of Winemaking Challenge

Description

The goal is to identify an innovative technological platform that can be used in the winemaking sector. The platform needs to be able to control all the information related to the daily oenological movements, as well as the company's financial management to improve the effectiveness and efficiency of its production processes, and its administrative processes.

The software currently being used by the company does not have the necessary features to perform efficient management of the business related to the Oenology sector. The objective is to find an innovative technological tool that improves the efficiency and effectiveness of the business, by standardizing procedures and allowing electronic registration so a global view of resource allocation can be achieved.

The Seeker, belongs to a large Portuguese business group which has been in operation in the national market for over two decades. This company has gradually been building its international presence.

The Problem Overview

Currently, the production area of the Seeker is operating at location A, the company management is operating at location B and the accounting department is operating at locations B and C. The accounting is performed in two different programs: the Agrifood Management Platform and the SAP program. The fact that there are two different programs means that the information and knowledge obtained is not always coherent. On the other hand, the company does not have technological tools that allow the automatic crossing of data between the two mentioned programs.

The distance between the production centers and the decision center, coupled with double registration of invoices, causes problems and constraints between the company's departments because the crossing of information between the two programs has to be done manually. This slows the process and is extremely subject to errors.

One of the consequences of the inefficiency of the current process is that the reports required for analysis by the management board are issued after the agreed date. Other problems are related to the lack of real-time product costing, tracking of materials and traded products, as well as ineffective stock management.

At the company's Location A (intended for production activities and first accounting of purchases and sales), the Seeker has a non-proprietary software aimed at companies in the Agrifood sector - The Agrifood Management Platform. All relevant information related to the development of the business is registered in this software, and all inherent invoicing is also performed using the same system. However, the software has been developed specifically for the agricultural and oenological area, presenting many gaps from an accounting perspective, namely, the stock/inventory calculation. Since it is based on the concept of average price, there are significant deviations in the cost calculations for each product.

The Current Process

In the winemaking sector, the following is the general procedure used:

1. Supplier invoices are sent to location A where they are received by the administrative manager and then forwarded to the General Manager. After validation and signature, these are distributed according to their nature. In other words, invoices referring to farms are forwarded to the person in charge of Viticulture. The invoices for the winery are forwarded to the person in charge of oenology and production. The respective managers insert the invoices of the suppliers (e.g. suppliers of stoppers, labels, bottles, etc.) into the Agrifood program for calculation of the production cost - this process is time-consuming.
2. Next, the invoices are sent to location C, in order to be accounted for (usually after the deadline). Once the invoices have been accounted for in SAP, it is necessary to cross-check the information of the invoices inserted in the Agrifood program with SAP. When the amounts are not equal in both programs, accounting adjustments must be done. This cross-check is performed manually and invoice by invoice.

Customers' invoices are issued in the Agrifood program. A file is then sent with the customers' invoices which then also need to be integrated into SAP. Given that the registration of products is carried out on the current software through the concept of the average price ("division by the total of liters"), the price calculated and made available by the software corresponds to an average price, and it is not possible to obtain the unit cost per bottle sold.

The main benefit for the Seeker will be improving the efficiency of how the business accosted with oenology is managed: Knowing exactly the cost of each bottle of wine, and making a seamless financial report to Location A in a timely manner, will result in maximizing the productivity of its employees.

Additional Details of the Desired vs. the Current System

The following table describes the intended features for the new solution compared to the features available in the company's existing software.