TD SYNNEX sees systems transformation gains

TD SYNNEX CEO Rich Hume said the company's systems transformation in the US is underway following its Canadian migration of its enterprise resource planning (ERP) systems.

The technology distributor, the product of the merger of Tech Data and SYNNEX, is a Celonis customer for multiple processes. When we last checked in with TD SYNNEX a year ago, Hume highlighted how the company planned to combine systems and retool processes such as order management and procurement.

Speaking on TD SYNNEX's fourth quarter earnings conference call, Hume said it surpassed its target of achieving $100 million in merger cost savings and delivered $145 million in fiscal 2022. TD SYNNEX has $62 billion in revenue, more than 23,000 employees and 150,000 customers across 100 countries.

Hume said:

"One of the largest integration projects is the consolidation of Tech Data's Americas ERP systems into CIS, the legacy SYNNEX ERP platform.

We have made excellent progress on the Canadian migration which we transitioned first, and our U.S. transition is well underway having recently completed another major milestone. I'm happy to report that more than 45% of the legacy Tech Data U.S. SAP business has now moved over to CIS and is executing well. We will continue transitioning the remainder of the business throughout the fiscal year and are on track with our plan to largely be complete within two years of the merger close date."

TD SYNNEX, which will publish its first corporate citizenship report this quarter, said it will continue to generate savings from its ERP integration, which is on track to be completed in the second half of 2023.

"Once we are fully integrated on one ERP system for the Americas, we expect to continue to find optimization opportunities and generate revenue synergies," said Marshall Witt, TD SYNNEX CFO.

Also see Celosphere 2022 video: Drive Value in System Transformation | System Transformation resources

Looking forward, Witt said optimization across multiple processes will be a core theme in 2023. "We certainly expect that the inventory declines due to supply chain constraints will be a benefit. And then the last piece is we do also expect us to become more efficient in our working capital management," he said. "One of the things just to remind everyone is that in many parts of the U.S., we still have duplicative warehouse systems. With that comes some inefficiencies. As we integrate into one ERP, some of that goodness will be felt in working capital efficiency."

Larry Dignan

Editor in Chief (former)

Larry Dignan is the former Editor in Chief of Celonis Media. Before joining Celonis, he was Editor in Chief of ZDNet and has covered the technology industry and transformation trends for more than two decades, publishing articles in WallStreetWeek.com, Inter@ctive Week, The New York Times, and Financial Planning magazine.