Erdinger Weissbräu: tradition and progress in procurement
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The procurement transformation of Erdinger Weissbräu WRITTEN BY
HARRY MENEAR PRODUCED BY
CHARLOTTE CLARKE
i nt .e rdi n g er. d e
ERDINGER WEISSBRÄU
Florian Eineder, Head of Procurement, discusses his vision of a first-of-its-kind procurement transformation at the private brewery Erdinger Weissbräu
B
etween 2004 and 2018, Florian Eineder worked in the solar power, trucking, oil and gas, chemical, utilities, market
research and procurement consulting industries. He moved onwards and upwards in the procurement divisions of the world’s most important companies, 04
leading global teams and driving transformation at speed and scale. Even early on a Friday morning, with the weekend firmly in sight, his voice is bright and energetic over the phone, rising to laughter as we ask the obvious question. “Why did you decide to go and work in a brewery?” “Come on,” he chuckles. “Isn’t that obvious?” Of the dizzying varieties of beer brewed around the world throughout history, wheat beer has one of the most interesting stories. A passionate beer lover, Eineder chose the brewery that reigns supreme in the wheat beer niche: Erdinger Weissbier. The roots of wheat beer date back to ancient Egypt. Its properly documented history only began around 500 years ago in the Duchy of Bavaria. At the time, beer made from wheat was quite
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controversial, as wheat was important
‘common,’ and no longer the province
to the bread baking process. From 1567
of the aristocracy. Noble or common,
onward, the use of wheat for brewing
wheat beer’s spiritual home has always
beer was even forbidden throughout
been IN Bavaria, where 90% of all wheat
Bavaria. Over time, a number of elec-
beer sold in Germany is brewed. Today,
toral breweries emerged throughout
the state is home to more than 1,000 dif-
the country in which the local rulers
ferent beer brands.
were allowed to have wheat beer brewed
The most prominent of those brands,
on payment of a special duty. However,
Erdinger Weissbräu, can trace its ori-
it was only when new brewing tech-
gins back to 1886, the year in which the
niques led to an improvement in the
construction of a wheat beer brewery
quality of brown beers in the mid-
in the Bavarian town of Erding was first
18th century that wheat beer became
officially recorded. Today, the mid-size i nt .e rdi n g er. d e
ERDINGER WEISSBRÄU
“When you work at a smaller company like Erdinger you really have to be as effective as possible, as quickly as possible. There’s no time for bells and whistles” 08
— Florian Eineder, Head of Procurement, Erdinger Weissbräu
brewery produces around 1.8mn hl
Today, as the world becomes an
(2018) of wheat beer per year.
increasingly complex and digitalised
Its longevity and success are based on
place, Erdinger is undergoing
the four cornerstones of the company’s
a first-of-its-kind procurement transfor-
philosophy: quality of the product
mation. we spoke with Eineder (sadly,
above all, a dedication to wheat beer,
not over a stein of wheat beer) about
appreciation of the employees and
his decision to leave one of the world’s
straightforward brand management.
largest consultancies for a 530-person
Erdinger makes no compromises
beverage company, how he’s driving
when it comes to quality, premium
a cultural and digital procurement
ingredients and its passion for
transformation across the more than
Bavaria’s cultural heritage.
130 year old brewing operation, and 09
C O MPAN Y FACT S
Market-altering innovation with Erdinger Alkoholfrei Innovative decision making has always been a part of Erdinger’s strategy. The decision to position Erdinger Alkoholfrei as an isotonic drink for athletes was no different. This shook up the market and helped kickstart the entire non-alcoholic beer market. The brand soon established itself as the leader in Germany and has helped maintain the overall growth momentum for non-alcoholic beers.
Around the world, non-alcoholic beer is typically seen as the responsible choice for designated drivers who are tired of mineral water. In Germany, it has another role: the perfect drink for athletes and active people. “It helps to recover much faster. As an athlete or a sporty person, drinking an alcohol-free wheat beer after training provides the body directly with valuable ingredients, satisfies thirst even faster and is completely natural,” says Eineder.
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“ I was looking for a company where you can really move something, make a difference” — Florian Eineder, Head of Procurement, Erdinger Weissbräu
how I came to Erdinger. I really like the company’s philosophy – taking care of each other, being close, being one team.” Upon taking the job, he assumed responsibility for Erdinger’s entire external spend. “Everything from hops, barley, wheat, yeast, glass bottles, bottling machinery, glasses, labels, label printers, cases, packaging, trucks, cars, the buildings to put them in, that’s all my team and me,” he explains.
Erdinger’s new role as the first
“We do actually have our own well at
brewery to implement SAP’s
the brewery, so I don’t need to buy
S/4HANA.
the water, which is nice.”
Eineder took on the role of Leiter Einkauf (Head of Procurement) in February 2018. “I had this very broad spectrum of experience — all in procurement of course,” he
When Eineder arrived at the company, its procurement function was very classical. Purchasing was regarded mainly as a back office function, and its success was mainly tracked by the number
recalls, “but I was not happy
of purchase orders made
with where I was. My last
throughout the year and the
project was outsourcing
savings that were negotiated
7,500 jobs, while the people
per purchase order. “Having
at the top were making mil-
worked for so many different
lions. From my perspective,
companies in so many differ-
that’s not how it should
ent industries, I had seen that
work. So, I was looking for
everyone is facing more or
a company where you can
less the same problems: opti-
make a difference. That’s
mising the external cost i nt .e rdi n g er. d e
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“ We are the first brewery to implement SAP S/4HANA as a full scale adoption” — Florian Eineder, Head of Procurement, Erdinger Weissbräu
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i nt .e rdi n g er. d e
ERDINGER WEISSBRÄU
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1886
Year founded
$600mn Revenue in dollars
530
Number of employees
position while keeping quality at a high level and increasing the efficiency of the procurement function. The difference is, when you work at a smaller company like Erdinger, you really have to be as effective as possible, as quickly as possible. There’s no time for bells and whistles,” says Eineder. At Erdinger, roles that would be dealt with by a 20-person team in a larger corporation are handled by a single individual; the consequences of decision making are felt faster and more
clearly than in bigger companies, leav-
catalogues, etc, but there’s also
ing little room for error.
a huge mindset change within the
Now, Eineder is driving a cultural
whole company that needs to be
and digital transformation across
accomplished.” Digital transformation
Erdinger’s procurement department
without a reimagining of culture and
centred around the integrations of
business process can never be suc-
two pieces of enterprise software:
cessful; George Westerman, a
SAP Ariba and SAP S/4HANA.
principal research scientist at MIT
“We’re going to get rid of as many
Sloan notes that, “when digital trans-
operational activities as possible,”
formation is done right, it’s like a
he explains. “There are technical
caterpillar turning into a butterfly,
challenges, of course, when it comes
but when done wrong, all you have
to implementing the software, the
is a really fast caterpillar.” For Eineder 15
E XE CU T I VE PRO FI LE
Florian Eineder Enthusiastic, professional and with a huge amount of experience, Florian Eineder is leading the procurement function at Erdinger Weissbräu and driving important change across the organization. His specialties include using procurement as an enabler and developing teams into business partners to stakeholders in order to drive corporate strategies and promote business goals. He is driving the digitalisation of Erdinger along with a strong focus on ROI with the necessary caution. Florian has 15 years’ experience in procurement divisions of the world’s most important companies, in leading global teams and driving transformation at speed and scale. i nt .e rdi n g er. d e
artn official Pg ss Er ng
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is the decision to position itself as the
across the brewery’s purchasing and
most progressive brewery at the fore-
procurement processes, that mindset
front of digital innovation with a new,
change has been essential. “It was
cutting edge ERP. Erdinger worked
and still is important to take every
successfully for many years with its
employee with us on this journey,”
previous legacy system. However,
he says. “We must ensure that digital
due to the company’s constant growth
transformation is seen as an opportu-
and the new digital requirements
nity and a necessity, not as a fashion
of an ever-evolving world, the system
phenomenon or even as a job destroyer.
reached its limits; more and more pain
Therefore, openness, transparency
points were discovered. This disruption
and a lot of communication are
isn’t unique to Erdinger; companies
non-negotiable.”
in every sector are faced with legacy
In addition to a new procurement
processes that are in need of moderni-
solution, perhaps the most disruptive
sation and optimisation. Erdinger’s
change that Eineder is implementing
growth has, for many years, been i nt .e rdi n g er. d e
ERDINGER WEISSBRÄU
driven by the quality and individuality of its product, but the company’s backend processes have not grown in tandem. “The bigger you get, the more difficult it gets to put your processes in order and have a cost effective workforce setup,” says Eineder. Erdinger decided to go with a new ERP system and face this mammoth task. “We’re implementing S/4HANA, which is sleek, modern and innovative. We are the first brewery to do this as a full scale adoption. It’s a showcase project; if it works 18
for us, then all the other breweries are going to start switching over to S/4HANA. We meet the brewery’s demand for innovation which is also evident throughout the departments of the company,” explains Eineder.
“It was and still is important to take every employee with us on this journey” — Florian Eineder, Head of Procurement, Erdinger Weissbräu
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Looking to the future, Eineder is
base in order to generate the most value.
excited to be bringing procurement
I think this kind of orchestrating function
out of the back office and into a place
is where the procurement department
that’s more relevant to the overall busi-
in most companies wants to go.”
ness. “Procurement is a driver for all sorts of things: for cost, innovation, risk management, and efficiency,” he says. “Going forward, I want to manage the relationship between internal stakeholders and external supply i nt .e rdi n g er. d e
Erdinger Weissbräu Lange Zeile 1 + 3 85345 Erding Germany T +49 (8122) 409 0 int.erdinger.de