AAF – or American Air Filter – was born in 1921 in Louisville, Kentucky. From the beginning, our company has been committed to delivering clean air.


Today, in the face of growing urbanization, industrialization, a booming middle class, and air pollution around the world, this mission is more important than ever. People need clean air to live. AAF strives to deliver it.

The backing of our parent company, Daikin Industries Ltd. of Japan, is helping us to follow through on our commitment to providing environmental solutions to mitigate some of the impacts. With support from Daikin, we are now #1 in the air filter industry globally.

Strides toward becoming an intelligent enterprise

But there’s always room for improvement. This has meant competing more effectively to meet the needs of our customers with high availability for desired products, total operational visibility from order to cash, and fast delivery on demand.

But things are complicated. In Europe, we operate in 16 different legal entities – all in different countries, following different procedures, and running on different systems. To start doing business in one way – not 16 different ways – we needed harmonization on a single, global ERP system. We needed digital transformation. We needed to become an intelligent enterprise.

For AAF, becoming an intelligent enterprise means nothing less than a jump into the future. This involves putting our data to work to achieve a consolidated view of operations throughout Europe. The aim is to improve transparency, increase automation, accelerate the pace business, and deliver the experiences that help us win and keep more customers.

The road forward with SAP and the cloud

For both of us, SAP was always a leading candidate for helping us to move forward. We both have deep experience in implementing and running SAP solutions earlier in our careers. In manufacturing industries, SAP is virtually unparalleled.

What has been new for us, though, is the cloud. To modernize our business and increase its agility, we wanted to move AAF to a cloud-based system. Fortunately, SAP has moved to the cloud as well as our implementation partner Allgeier.

Cultural change

Critically, we approached the transformation not as an IT project but as a cultural change for all of our people in all of our factories and facilities in Europe. Constant internal communications, with a common agenda for changing together, have helped to alleviate concerns and foster a shared commitment to seeing the transformation through.

The power of one

On the solution side of the equation, the foundation of everything we’re implementing is SAP S/4HANA. This will replace the wide array of disconnected ERP solutions currently implemented across our 16 legal entities.

Not only are we implementing in the cloud, but we are doing so in the public cloud. Arguing in favor of this choice were considerations such as economies of scale, improved infrastructure agility, and the proven security of SAP S/4HANA and public cloud providers alike. 

Also, our roadmap forward calls for cloud solutions as part of our multi-cloud approach that will support:

  • Our sales forces
  • HR processes
  • Travel and expense reporting
  • Analytics for generating actionable insight based on data from anywhere

Our implementation begins in Germany and Austria in 2020 and will continue to other facilities according to a phased rollout plan. When we are done, we will have established one common system that provides a single source of truth for operational data across all facilities running in Europe.

A dream team

Throughout our transformation effort, we have had the support of a dream team of colleagues across AAF, SAP, and our partner Allgeier. All teams have all worked together to help us overcome obstacles and execute change as required. Internally, colleagues from Japan, Finland, Slovakia, France and elsewhere have supported us with a diverse mix of on-the-ground knowledge and technical know-how to help us plan effectively and avoid the roadblocks that otherwise lead to delays.

One critical decision for our success was the choice to work closely with SAP service organizations. At first, we were a bit skeptical, but throughout the project, they have proven invaluable in various areas such as understanding the product hierarchy, building critical data feeds, and configuring the software for the unique needs of the filter manufacturing business. Access to industry experts and product development, and having a team of professionals dedicated to helping us achieve value, has been critical to the success of our transformation.

In the cloud world, implementation projects move much more swiftly compared to their on-premise counterparts. The expertise and drive of our project team have helped to keep us on track. Time and again, we have been impressed by the speed at which this team operates. In instances where we’ve encountered problems in the project, our team has invariably pulled together quickly to offer up a new solution – typically in days rather than weeks.

A big step toward ongoing success

The consolidation of European operations on a single ERP system is only the first step in a much longer journey that, if past is precedent, will continue indefinitely. Change is constant, and at AAF, we expect this first step in our transformation journey to give us a foundation for ongoing agility and innovation.

This foundation – based on data visibility and insight – will enable changes in business models and will mean taking responsibility for installing all filters and replacing them as needed. Data collected could be analyzed using machine learning. With this analysis, we’d be able to predict product failure ahead of time and optimize the product lifecycle. Ultimately, this will further support our mission of delivering clean air to customers – but now at levels of efficiency never dreamed of when our company started almost 100 years ago. This, we think, is progress.

By Angelika Schwartz, Head of IT and Frank Kress, Vice President Finance – Controlling – IT, American Air Filter Europe

About SAP

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