Tainui Group Holdings (TGH) is the inter-generational investor and kaitiaki (guardian) of the commercial assets for the 67,000 members of Waikato-Tainui. Established in 1997, following settlement with the Crown two years earlier, TGH takes responsibility for protecting, nurturing and growing tribal commercial assets. The organisation pursues a strategy of identifying and growing a diverse range of high quality assets to provide consistent, long-term dividends to current and future generations of Waikato-Tainui. These dividends are used for charitable purposes by shareholders, to invest in education, welfare, and health, as well as social and cultural facilities and activities, for the benefit of Waikato-Tainui members.
Since their establishment, TGH have successfully grown their asset base from NZ$170 million to around NZ$1.1 billion today, and have invested over NZ$420 million in the Waikato region over that time. They are also responsible for having directly and indirectly created around 3,800 jobs in the region.
With a vision and investment horizon firmly focused on creating sustainable growth for the next 50 to 100 years, TGH has focused the majority of their investment in the property, retail, hospitality, primary industries and equities sectors. Key property investments and developments include The Base shopping Centre in Hamilton, the Novotel Hotel at Auckland Airport and the University of Waikato site, among others. In addition, current TGH financial investments include Go Bus and a stake in Waikato Milking Systems, a leading designer of technology for the dairy industry.
As a visionary and firmly future-focused organisation, TGH knew that their IT systems would need upgrading if they are to meet their long-term goals. Prior to selecting a new IT solution, senior leaders at TGH identified the following elements of their ideal future state:
- Borderless enhanced user experience (UX) to meet the needs of the modern, internet-enabled workforce.
- Ownership and management of key data sources.
- Real-time collaboration and sharing.
- Infrastructure as a Service (IaaS) and Software as a Service (SaaS) to capitalise on improvements in agility and cost savings.
- A high level of automation and integration.
- Strong security, clear data visibility and managed risk.
- Efficient use of near real-time data to enhance decision making.
To TGH, it was clear that their current IT systems would not be capable of meeting these requirements and, ultimately, would not enable them to continue the strong growth they had been experiencing. Their Enterprise Resource Planning (ERP) system was not fit for purpose, being highly bespoke in nature and without the ability to scale to meet growth. This meant the solution comprised a high level of vendor lock-in, leading to serious cost implications for the business. The holistic, rather than modular, nature of this legacy system added to the pain, making it very difficult to add even small amounts of functionality. In addition, the system was constrained by manual processes, causing serious headaches for TGH who knew they needed to free up their people for more value-adding work. Finally, the system lacked key reporting capability meaning that senior TGH executives were unable to get clear answers to key business questions in a regular and timely fashion.
Tainui Group Holdings (TGH) engaged Zag (formerly Soltius) in late 2014, in their search for a new ERP system that could help them become more efficient, integrating their data into a single ‘view of the truth’. They chose SAP Business All-in-One™ as the solution to achieve this goal. A major reason for choosing SAP over other software options, and Zag over other vendors, was the reputation for stable, quality systems and work. “For a project of this kind of importance, we needed a safe pair of hands. In this market, SAP and Zag are that safe pair of hands”, says Helaman Tangiora, ICT Manager for TGH. Implementation of the new ERP system began in January 2015, with an overall focus on finance and real estate management (with some facilities management), to match TGH’s main areas of investment.
With a view to implementing a solution to match their ongoing digital strategy, and which was going to be flexible enough to grow with them into the future, TGH consulted with Zag around the Partner Managed Cloud (PMC) option to hosting their new ERP. In this approach, the SAP partner takes care of deployment, application, and infrastructure management services, as well as ongoing maintenance and support. This was a first for Zag, and TGH have enjoyed the simplification PMC has brought.
In terms of the infrastructure management element of the PMC model, Zag recommended TGH to host their new system on the Amazon Web Services (AWS) cloud platform. This cut out the need to invest in on-premise hardware, whilst allowing TGH to pay a single subscription fee, instead of yearly licensing fees. TGH felt this would provide them with greater control over their operating expenses, since the PMC model has been proven to reduce total IT costs by 30% compared to an on-premise deployment. TGH felt that this was the perfect fit for them and would enable them to quickly respond to changing environments in the future, whilst maximising their investment, by allowing them to allocate costs to OPEX rather than CAPEX.
“AWS is now one of the central elements of our digital strategy”, says Tangiora. “When weighing up my options in IT purchases I use the Gartner Magic Quadrant a lot. AWS is by far the leader in the cloud hosting space and I believe that’s down to the huge investment they continue to make in their platform”. The ability to foster agility and have their system now scale to meet demand, is a major benefit for TGH. “With SAP on AWS, we can turn our servers off when we are not using them. We love that”, adds Tangiora. TGH no longer have to invest in large amounts of hardware in an attempt to estimate the amount of capacity they will need. They now have the ability to be flexible, scaling their systems up and down depending on demand and traffic.
The new Tainui Group Holdings SAP ERP system went live on 1 October 2015, with 40 users. Although the system is still quite new to TGH, they are already starting to see the benefits, and now have around 60 staff regularly using it. From a high-level point of view, the organisation now has one version of the truth, instead of having to refer to multiple systems for their real estate, finance and facilities data, for example. “We’ve already noticed that processes have been streamlined and automated, freeing up our people to do more value adding work”, says Tangiora.
In addition, TGH have seen immediate improvements in the visibility and traceability of their purchasing operations, due to business process discipline enforced in the SAP system. This has already started to reduce the number of variations, ensuring all purchasing is done with a purchase order and approval in the system, by staff with the correct DFA.
With the TGH Data Centre, Network and Server Infrastructure now all virtualised on AWS, and hosted out of the Sydney region, the economies of scale now afforded to them are second to none. The process of setting up on the AWS platform, which was facilitated by Zag, took less than a month – all the way from design, to deployment, through to the new SAP ERP being ready for Tainui to use. TGH see this move to AWS as a step further towards becoming an innovation-led business.
The Road Ahead
TGH are now well positioned to grow their SAP footprint, with all the agility and flexibility that the AWS cloud platform allows. Following ongoing conversations with Zag, TGH are now looking at developing a roadmap towards mobilising their SAP system, which would allow their people to perform asset inspections from the field, for example. TGH are also looking at further developing their analytics capabilities to uncover powerful insights from their data, which will be used to drive future business decisions.
Zag looks forward to continuing to work with TGH, helping to define an SAP roadmap for the future and working together towards ongoing and sustained success.