Into the Future with Cloud-ERP

At the packaging manufacturer, MM Group, the ERP system ensures transparency in the production of a complex product range. The core is the industry solution COSMO Print and Packaging from COSMO CONSULT, which is based on Microsoft Dynamics 365 Finance & Supply Chain Management. After initially opting for an on-premise implementation, the packaging specialist later transitioned to the Azure cloud. This move aims to onboard new production sites more quickly in the rapidly growing company.

Since the 1950s, the MM Group has been producing cardboard and folding carton products, initially in Germany and Austria. Today, around 15,000 employees work for the global producer of consumer packaging. In 2023, the European market leader generated an annual turnover of 4.2 billion euros. Two independent divisions work hand in hand: MM Board & Paper produces cardboard, kraft papers, and uncoated fine papers, while MM Packaging manufactures folding carton packaging, package inserts, and labels.

Since 2009, MM has been using Microsoft Dynamics AX 2009. During the evaluation process, the decision was made in favor of the standard ERP world and Microsoft due to lower costs and better usability. "The focus was on mapping the individual and industry-specific processes in the plants as well as possible in the standard software. For this, we relied on the certified industry solution COSMO Print and Packaging from COSMO CONSULT, which already provided a lot of important functionality," reports Florian Janda, Head of Business Applications at MM Group. The Microsoft solution serves as the base layer, with the COSMO industry solution built on top as the second layer. The third "customer" layer consists of customizations and developments carried out jointly with COSMO. The COSMO industry solution adds further functionality not available out-of-the-box in the Microsoft ERP standard, such as tool management and attribute management.

The special feature of the COSMO industry solution is a product cockpit that describes the production process. "Products go through at least three production stages. First, printing on sheets or rolls, then die-cutting, and in the third stage, the boxes are glued, followed by further finishing processes like hot or cold foil," explains Harald Aichner, Team Lead Business Solutions MM Group Packaging. The product cockpit clearly displays all production stages and associated workflows, including work rules and bills of materials. "Due to the many variants and the complexity of the products, the processes would be unmanageable at the employee level without the cockpit," says Aichner.

In 2018, a project was launched to upgrade the aging ERP system AX 2009, which was running in 29 packaging plants. The upgrade to the current version Dynamics 365 Finance and Supply Chain Management initially took place in an on-premises environment. The Neupack plant in Hirschwang went live as a pilot in 2021. "We saw a big difference from the old solution; the technological landscape changed significantly with this solution, especially with regard to the many services that need to run smoothly in the background," says Aichner. It quickly became apparent that running the system in their own data center was too cumbersome. "This pointed the way to the cloud," says Harald Aichner. Stability and performance issues ultimately led to the decision to move to a native cloud environment. The cloud migration for the pilot plant, including the COSMO Print and Packaging industry solution and custom components, started in February 2022 and was completed by July 2022.

This step was crucial for the packaging specialists to minimize risks when migrating all other plants. Contractually, the transition also went smoothly: "COSMO CONSULT constructively supported us in converting existing agreements into a cloud-compliant contract, moving to subscriptions instead of purchase licenses," recalls Florian Janda.

"Despite a lot of respect for the first cloud project, the path to the cloud was always 'on track' and we hardly encountered any difficulties," says Aichner in retrospect. "Since we've been in the cloud, there have been no stability issues. In the on-premise world, problems occurred on average every two weeks," praises the ERP expert. The speed of the move was also aided by Microsoft's Fast Track Support.

The main benefit is that COSMO consultants bring a lot of expertise in MM-specific processes, says Harald Aichner: "They are familiar with the requirements for printing, die-cutting, and gluing. So, you don't have to explain your processes from scratch, as is often the case with consulting firms." There is close contact with the partner, even when it comes to new requirements. "This always leads to a very quick solution. This is crucial for us in this area, where problems could otherwise disrupt production," adds Aichner. The new kernel was also built using the SAFe framework, working closely together based on agile methods.

Following Microsoft's One-Version concept, the corresponding version of COSMO Print and Packaging is always provided for the respective version of Microsoft Dynamics 365 Finance and SCM. In 2022, the Romania region was moved to the cloud. In 2023, France, Poland, and the UK site in Newport were added, with the rollout continuing in 2024.

In one of the acquired plants in Newport, the old ERP and MES system could not be used further due to contractual reasons, so quick action was needed. Within four months, the rollout of the new cloud kernel, consisting of the Microsoft standard ERP combined with the COSMO industry solution, provided the necessary functionality: a crucial issue for a rapidly growing company. "The product cockpit makes the difference here – because it is so compact and can be easily used for other plants," reports Aichner. The feedback on-site was particularly positive. "The challenge was that we had only worked on sheet printing with COSMO CONSULT so far. For this project, COSMO quickly contributed the topic of roll printing at a high pace," explains Florian Janda. This would not have been feasible with a partner without such deep industry knowledge within this timeline.

There was another reason to switch to the cloud: "Certain functions are no longer available on-premises. The functionality variety is much greater in the cloud," says Janda. This is especially true for the area of artificial intelligence, which will also become important for MM in the future – even though they are still at the beginning of the journey. They are currently on the way to replacing old solutions with Azure components to benefit more from the platform. "It's a big supermarket from which we can shop, i.e., book services. The goal is to elevate all plants to this future platform," describes Janda. This includes topics like Power BI or the ChatGPT-based AI assistant technology Copilot. MM is currently in a private preview with Microsoft to evaluate in a proof of concept whether the AI brings corresponding efficiency gains in daily operations. "For us, the innovation that COSMO CONSULT brings is crucial, in addition to the industry knowledge," says Florian Janda.