Building foundations and transforming business with Peab
Unit4 helped a Nordic construction giant streamline operations, finish an award-winning project ahead of schedule and switch to remote working due to the Covid-19 pandemic. Alan Clark, Global Head of PSO at Unit4, caught up with Johan Isoz, senior ERP project manager at Peab, at our recent global event, Experience4U, when they discussed business transformation, project management and why good project consultants know when to challenge a client.
Peab is one of the largest construction companies in the Nordic region, with a workforce of about 16,000 people and revenue of approximately SEK58 billion (EUR5.6 billion). Given that the company manages hundreds of projects daily, operational efficiency is vital. When the company needed to replace an ageing ERP system, it picked Unit4.
Alan: Let’s start with you telling us something about Peab?
Johan: Peab is one of the leading builders in Scandinavia. We work in construction, civil engineering and project development.
Our project with Unit4 was for our civil engineering and construction business divisions, which account for more than half of Peab’s turnover. The project’s owner was a shared service center within Peab, which helps Peab’s civil engineering and construction businesses with administrative tasks.
Being entrepreneurial is in Peab’s mindset. We’re very hands-on and have a very friendly environment to work in. Peab’s recent projects include building one of the biggest shopping malls in Sweden and an airport in north Sweden.
Alan: Besides projects in different countries, what triggered the need to pull your ERP together for different projects in multiple countries?
Johan: One of Peab’s divisions used ERP software that was about 20 year’s old and had been heavily customized. We wanted a new ERP system and asked the market for a Request for Proposal (RFP).
Alan: Have you set yourselves clear success criteria for the ERP solution project?
Johan: Besides the normal project goals of it running on time and budget, we had other criteria, including minimizing manual work, streamlining processes across the Nordic region and minimizing the work needed to replace the system. Another priority was that the Unit4 ERP software would enable us to replace our previous six company databases with a single database. We wanted to minimize the amount of data integration work involved in this part of the project. When we had six databases, we had over 150 data integrations to manage.
Also, we wanted to implement the Unit4 software at the same time as a new front-end system for the business.
Alan: What differentiated Unit4 versus other vendors?
Johan: Our RFP for a new ERP system was very long. I think many of the vendors in the RFP didn’t even read all the RFP. Unit4 really understood what we needed. Your sales process and communication with us was very good and made us feel comfortable. We also knew the Unit4’s ERP system was what we wanted – a modern, up-to-date, mobile, web-based system that we could live with for another 20 years.
Also, we wanted to work directly with the vendor, not a partner. The tender process was long, but we came up with a good agreement.
Peab’s steering committee for the ERP project was very pragmatic and solution-minded through the project. Everyone did tremendous work. We won a Swedish award for the best business system project for 2020.
Alan: How was the working relationship between Peab and Unit4 during the project?
Johan: We had a strong relationship with Unit4 consultants who worked with us on the ERP project. It was one of the main reasons why the project succeeded. They were good consultants because they didn’t always say yes. They were very experienced. A good consultant will say to a client: “Have you thought about doing it this way?” That made us trust them and give them more responsibility to construct a solution for us. It was a partnership.
Alan: Did you come across any unexpected values or benefits during the work, or even things that didn’t go as planned?
Johan: The organizational benefit for us from the project was streamlining the reporting structure across countries and working closely with our Finland business, for example. We centralized the main financials of the system in Stockholm. We know the Peab group better now than we did before we installed the Unit4 software.
Alan: Was there a significant business transformation need alongside the ERP implementation?
Johan: The thread through the ERP project was minimizing manual work. We deal with six to seven thousand transactions every day, so the ERP system needed machine learning to help us deal with that. The software saved time in accounting tasks such as accounts receivable and accounts payable. That freed time to improve other parts of our business in the rest of the Peab group.
Alan: What lessons can you share with us that can help others in the future?
Johan: Do your homework before you buy ERP software. Never stop challenging procedures in a company. Don’t be afraid to switch to best practices. Also, make sure that your business has good project managers because they can save projects. We had two good project managers for the ERP project, plus a great team.
Alan: Can you name some benefits of the ERP usage during this COVID period?
Johan: Working remotely, from home or wherever, was easier because of the Unit4’s web interface. It made us more mobile.