Explaining How SAP Creates Value for the Building Materials Industry

The Building Materials industry is under pressure to meet evolving customer demands, growing regulatory requirements, and sustainability goals—while managing costs and maintaining quality. Disruptions in the supply chain, raw material fluctuations, and labor shortages intensify the need for smarter, more agile operations.

SAP supports this transformation with a suite of integrated solutions designed to address the specific needs of the building materials sector. These solutions help companies streamline operations, improve decision-making, comply with environmental regulations, and scale sustainably across regions.

1. Integrated Business Processes for Greater Efficiency

   SAP connects business functions—finance, procurement, production, logistics, and sales—into a unified digital core.

   • This improves transparency, streamlines workflows, and reduces manual data handling.
   • Integrated platforms enable faster decision-making across departments.
   • Companies achieve real-time collaboration between operations and corporate strategy.

   Example:

   One building materials company reduced its month-end closing cycle by 60% and improved data accuracy through a shared system across finance and operations.

2. Sustainability and ESG Compliance

   SAP embeds sustainability into core operations, enabling companies to meet compliance requirements and consumer expectations.

   • Real-time tracking of emissions and material use supports environmental reporting.
   • ESG metrics can be monitored across product lifecycles and value chains.
   • Health, safety, and environmental risks are tracked and addressed proactively.

   Example:

   Companies using SAP Sustainability Control Tower reduced ESG reporting time by 85% and gained a system of record for compliance with regulations like CSRD and carbon accounting frameworks.

3. Resilient and Agile Supply Chains

   SAP improves supply chain agility and resilience by integrating planning, sourcing, and logistics operations.

   • Inventory and production plans are aligned with real-time demand.
   • Supplier collaboration is enabled through digital networks.
   • Logistics data supports on-time delivery and margin protection.

   Example:

   A global supplier in the building materials sector reduced inventory levels by 32% and achieved a one-week order-to-delivery cycle using SAP’s integrated planning and logistics solutions.

4. Data-Driven Decision-Making

   SAP provides actionable insights across all operational areas with powerful analytics tools.

   • Performance dashboards support proactive risk mitigation and optimization.
   • Predictive analytics help companies anticipate market changes and align strategies.
   • Standardized data improves collaboration and performance benchmarking.

   Example:

   Companies using SAP Analytics Cloud gained greater visibility into margins, project timelines, and product performance, supporting faster, data-informed decisions.

5. Scalability and Industry Readiness

   SAP’s cloud-based solutions are modular and scalable, allowing companies to expand globally while remaining compliant with local regulations.

   • Fit-to-standard templates reduce implementation time.
   • The platform supports rapid integration with third-party tools and technologies.
   • Preconfigured processes for building materials improve user adoption and consistency.

   Example:

   A manufacturer went live with SAP S/4HANA Cloud in under six months, with near-100% system availability and 20% faster integration with external partners.

Let's look at how SAP solutions have revolutionized businesses in the Building Materials Industry, as shared by various customer testimonials.

RHI Magnesita operates complex manufacturing and mining sites across more than 30 countries. Years of acquisitions and local adaptations created a highly customized and regionally fragmented ERP landscape, limiting cross-entity transparency and process consistency while increasing system complexity and maintenance efforts. The company needed a data-centric path to global standardization that could support complex manufacturing requirements while improving productivity and preparing the organization for greater automation and analytics.

To address these challenges, RHI Magnesita implemented a comprehensive solution strategy:

• Established a clean-core, two-tier SAP S/4HANA Cloud architecture, with SAP S/4HANA Cloud Public Edition as the strategic target for most entities and a standardized Private Cloud template supporting more complex business models.
• Created a unified global template across both cloud tiers, supported by SAP Master Data Governance to provide consistent master data, harmonized reporting, and cross-entity transparency.
• Integrated SAP and non-SAP applications through SAP Business Technology Platform (SAP BTP) and MuleSoft to provide end-to-end connectivity across the value chain.
• Integrated SAP Digital Manufacturing with the ERP landscape to connect production processes and enable bidirectional communication between machines and ERP systems, supporting real-time steering and data analytics.

The implementation of the two-tier architecture resulted in significant business improvements:

• Achieved a greater than 90% SAP standardization rate and harmonized approximately 300 processes across sales, procurement, manufacturing, and finance.
• Identified more than 30 value levers expected to reduce annual operating costs by €25 million through greater process efficiency, transparency, and AI-agent utilization.
• Increased shop-floor efficiency by 2% through integrated production planning and machine-to-ERP connectivity, improving production capacity utilization.
• Reduced finance workload by 10% by integrating Blackline with SAP and leveraging AI agents to reduce manual reconciliations and support faster, more reliable closing cycles.
• Reduced inventory outstanding by four days, resulting in more than €30 million in net working capital improvement.

Tyrolit Group needed to comply with evolving sustainability reporting requirements, including the Corporate Sustainability Reporting Directive (CSRD), while managing ESG data across its global operations. Existing processes relied heavily on spreadsheets and disparate systems, making it difficult to integrate, validate, and share reliable ESG data across operations, supply chains, and business partners. The company also needed to align sustainability reporting with financial reporting standards and create auditable sustainability figures.

To address these challenges, Tyrolit Group implemented the following solutions:

• Implemented SAP Sustainability Control Tower on SAP Business Technology Platform (SAP BTP) to centralize and manage reliable ESG data.
• Integrated SAP Sustainability Control Tower with SAP S/4HANA Cloud Private Edition and SAP Sustainability Footprint Management to automate data collection from multiple sources.
• Used SAP Analytics Cloud dashboards and planning capabilities to monitor ESG performance, measure sustainability goals, perform scenario analysis, and support reporting.
• Leveraged SAP Business AI to support generative AI-powered sustainability reporting and automate emission-factor mapping between SAP S/4HANA data and lifecycle assessment databases, reducing manual effort and improving accuracy.

The implementation resulted in the following outcomes:

• Automated ESG reporting and data collection across 48 companies, providing more than 60 ESG managers and users with tools for sustainability reporting and decision-making.
• Established audit trails, workflows, and approvals to strengthen ESG governance and compliance while monitoring more than 80 ESG metrics connected to finance, operations, and risk assessments.
• Reduced plastic usage by 65% by incorporating ESG data into daily operations and providing greater visibility through dashboards.
• Reduced annual CO₂ emissions at the company headquarters by more than 1,100 tons through process optimization and reduced gas consumption.
• Recycled more than 30% of the film used in packaging while transitioning to thinner, pre-stretched 17 μm film.