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Freudenberg Achieves Global Cost Transparency

Standardized controlling area for 30 subsidiaries

Freudenberg Home and Cleaning Solutions (FHCS) and its 30 subsidiaries all have access to a central SAP system. This enables them to work with corresponding modules for processes in production, supply chain operations, sales, and accounting. In the past, the company’s controlling areas were decentralized, meaning that each used the applicable national currency. Costs were converted into the group’s currency (euros) using manual methods. Besides being unwieldy, the resulting processes failed to offer the transparency required and were a potential source of mistakes. “Our group’s international orientation and various brands were ultimately what prompted us to establish a single uniform controlling area in line with the ‘ONE global corporation’ principle,” recalls Monika von Duering, corporate director of business processes and systems.

From the delivery of raw materials to their processing along the production chain, FHCS’ products often pass through multiple locations in different countries. The company used to post the related costs in the respective national currency. Because of its many different production locations, FHCS was unable to quickly access comprehensive breakdowns of its costs. There was no overview of the financial resources required for materials, personnel, suppliers, and other aspects of the product cycle. At the time, the only solution was to convert these figures into euros manually – but this also involved currency effects, intercompany surcharges, and other factors that needed to be taken into account. To reduce this complexity while improving transparency, FHCS wanted to start with the system itself. It therefore decided to harmonize its controlling areas and combine them into just one.

As its partner for the project, the Weinheim-based company chose cbs Corporate Business Solutions. For FHCS, a number of factors spoke for cbs. “They’d already succeeded in implementing similar projects and had excellent industry references,” von Duering explains. The company’s proven M-cbs methodology and minimally invasive approach ensured that there was barely a hiccup in the day-to-day operations at FHCS. All its units were able to continue working with no restrictions immediately before and after the transformation.

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