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ABB Unifies Data from 40 ERPs and Enables Millions of Dollars in Savings and Growth

With Snowflake, ABB has improved decision-making across its supply chain, pricing and distributors, resulting in hundreds of millions of dollars in savings and revenue growth.

KEY RESULTS:

$200M+

Annual inventory savings improved by supply chain analytics

$900M

Revenue growth influenced by data-driven pricing optimization

Two data scientists working together
ABB logo
Industry
Manufacturing
Location
Zurich, Switzerland

Powering decisions that power the world

ABB is focused on enabling a more sustainable, resource-efficient future through electrification and automation. Customers across numerous industries rely on ABB’s products, systems, services and solutions to optimize how things are manufactured, moved, powered and operated. For data-driven decision-making across the company’s four business areas and 20 divisions, ABB ingests and analyzes large amounts of ERP and data from other business systems.

Story Highlights
  • Supply chain analytics: Snowflake makes it easier for ABB to analyze sales and purchase-order data and avoid unnecessary inventory purchases which result in annual inventory savings.

  • Pricing algorithms: ABB’s pricing algorithms use data in Snowflake to inform complex business decisions involving multiple products, sectors and business objectives.

  • Distributor insights: ABB’s distributor optimization dashboard, powered by data in Snowflake, surfaces insights to help customers save money through strategic ordering.

Unifying data from 40 ERPs across 100 country-based organizations

ABB’s technology ecosystem included 40 geographically dispersed ERPs, 100 country-based organizations, 25 different data warehouses, 4,000 applications, 15 SAP Business Warehouse instances and thousands of related software systems. Time-consuming data consolidation led to analytical delays and made it difficult to achieve a cohesive view of ABB’s global operations. 

“To get a global set of usable data took us a month of data wrangling, and, by that time, the information was out of date,” says Michael Thorne, global analytics product engineering and delivery manager at ABB. ABB experimented with a Hadoop solution but still struggled to efficiently deliver meaningful insights to analytics users. According to Thorne, “Fifty percent of our team’s capacity was spent managing, maintaining and upgrading software packages on the environment. We spent more money running it than actually building solutions on top of it.”

A single platform to power global manufacturing analytics

With the Snowflake Data Cloud, ABB implemented an “extract once, use everywhere” strategy that simplified data consolidation and enablement. According to Thorne, “We moved from nightly extracts, which cause significant overhead on countless systems, to a single, near real-time CDC process that replicates information to Snowflake without much overhead.” Snowflake Secure Data Sharing enabled governed, secure data collaboration with ABB’s four business areas. 

Centralizing and sharing data with Snowflake made it easier to build data products for marketing campaign analytics, quotation success metrics, production line tools, supply chain dashboards and reports used by thousands of ABB users across the globe, including internal customers and external vendors.

Snowflake gave us a better pricing model, platform management was almost nothing, scalability and performance outpaced everyone else, and there were many options for integrating data sources. The real kicker was that it’s SQL based, which is a skill that’s readily available in the market.”

Michael Thorne
Global Analytics Product Engineering & Delivery Manager, ABB

Leveraging supply chain analytics for $200+ million in annual inventory savings

Architecting on the Snowflake Manufacturing Data Cloud puts ABB in a better position to harness data and respond faster to dynamic market conditions. For example, ABB’s electrification business used Snowflake to avoid unnecessary inventory purchases for canceled orders during the COVID-19 pandemic. “We created a solution that ultimately saved about $4.5 million per week in canceled purchase orders for material that would have sat on our shelves.  It’s a little more than $200 million per year that we saved in inventory,” Thorne says. 

Data plays a critical role in ABB’s ability to meet customer commitments despite supply chain uncertainty. For example, analyzing raw material and production data stored in Snowflake makes it easier for ABB to deal with disruptions in the plastics and semiconductor industries. Ingesting plant capacity data into Snowflake unlocks new insights for avoiding manufacturing shortfalls and canceled orders. According to Thorne, “We’re now able to shift around production capacity to meet demand whenever we have it.”

two people looking at a laptop and smiling while one of them points at the screen

“Data was an afterthought in the past. Now we’ve shifted to a mindset of utilizing solutions to generate proper information and enabling insights to make better business decisions.”

Michael Thorne
Global Analytics Product Engineering & Delivery Manager, ABB

Supporting $900 million in revenue growth with enhanced pricing insights

ABB’s electrification business relies on Snowflake to strike a balance between order volume and profit margin—especially during periods of rising inflation. Pricing algorithms use data from the Data Cloud to enable complex decisions involving multiple products, sectors and business objectives. “The end result was a more level manufacturing line and increased revenue growth by $900 million last year—and that was just in the U.S. alone,” Thorne says.

Partnering with distributors for optimal ordering, cost efficiency and healthy relationships

ABB’s distributor optimization dashboard, powered by data in Snowflake, helps the electrification sales team identify suboptimal ordering patterns and recommend improvements, resulting in $1.4 million in operational cost savings for ABB’s distributors and 22% fewer split case orders. Distributor order volume is up 36%, and total purchase-order value has grown by 45%—despite a 6% drop in total purchase orders received. 

“We’re selling more products on orders, giving free shipping to distributors more often, and saving them a lot on processing costs. We’re making more money as a company and bringing in higher order values,” Thorne says. “We provided distributors with a recommended order pattern based on data models on Snowflake, so they could maintain proper case sizing and receive products in a regular cadence. This reduced the number of orders they needed to place, minimized their inventory carrying costs and lowered their order overhead.” 

Expanding data access across multiple business areas

With Snowflake, ABB has built a scalable foundation for enabling a “data-first” mentality across its four business areas. Snowflake’s role-based access controls and data governance features are empowering more users to explore data and develop solutions that accelerate innovation at ABB. “Instead of just providing access to a dashboard, we can share information that’s specific to each business analyst and let analysts utilize models inside their solutions. It’s opened up greater opportunities for reuse,” Thorne says. 

Snowflake Marketplace offers a convenient, secure way to access data from ABB’s data providers. For example, ABB’s electrification business uses Snowflake Marketplace to access construction, real estate and commodity data products. According to Thorne, “Data is readily available, you don’t have to build ingestion pipelines and insights are live as soon as the provider updates the information. Time to actionable insight is drastically reduced.”

Accelerating factory optimization and sales efficiency with data

Snowflake will play an important role in ABB’s factory optimization initiative that aims to drive increased production efficiency. Extending the supply chain analytics solution reached by ABB's electrification business to their other businesses could deliver substantial inventory savings. Supply chain mapping will increase visibility into ABB’s global supplier relationships. 

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