Conrad Electronics + Celonis

Context: From brick-and-mortar retailer to digital B2B giant

German Electronics retailer Conrad Electronics underwent a massive transformation in recent years, with resounding success.

Once an established brick-and-mortar competitor to electronics retail giants, the family-owned company has completely repositioned itself in the past five years, building a partner marketplace and shifting its focus towards online retail and B2B customers.

“We want to become Europe's leading B2B procurement platform,“ said Jörg Frenzel, Director of Operational Excellence at Conrad Electronics SE, during his presentation at the Celonis World Tour 2023 in Munich.

His team’s mission is to “simplify and automate complex, repetitive tasks, effectively use our resources, and provide our customers and partners with the best service possible.“

Challenge: Growth creates complexity for Conrad Electronics

A mammoth task given the size of the company: Conrad offers nine million products from over 6,000 brands, sells to roughly 21 million customers per year, and deals with a process landscape that has evolved over 100 years.

“Trying to map and analyze this with manual methods was simply impossible,“ said Frenzel. With process mining vendor Celonis, they found a better way.

Starting their Celonis journey in 2020, Frenzel's team initially focused on Order Management. The goals: reduce late deliveries and the order cancellations that resulted from them. With Celonis, Frenzel and his team brought some long-needed transparency to the table. 

“Celonis provides a wealth of information. No one could have described the true complexity of our process to the level Celonis does."

“And it doesn't stop there. Before Celonis, we couldn't drill down into customer or material groups.” As a result, Conrad could neither see why delivery delays were occurring, nor what steps they needed to take to prevent them. Celonis changed that.

Solution: Better customer service, reduced costs

Today, Conrad’s Order Management is on a whole other level. The team uses intelligent automations, dubbed Action Flows, that automatically notify employees about orders at risk.

At the same time, Celonis gives them intelligent recommendations on what to do next (e.g., resolving an order block for a customer with a spotless credit history) and visualizes how their delivery delays are trending over time.

This enables the order team to prioritize urgent orders, meet logistical cut-off times, and thus deliver on customer promises.

The results are impressive. In Order Management, Conrad:

• Realized over €500,000 in cash impact on earnings,

• Increased the automation rate from 51% to 79%, 

• Cut one hour in rework, 

• Reduced blocked orders by 30%, and

• Lowered the order rejection rate from 2.5% to 1.8%.

“More than ever, our customers are getting their packages on-time. That’s an incredible success for us.”

Reason enough for the electronics retailer to enter into a strategic partnership with Celonis in 2022. Today, Conrad uses Celonis enterprise-wide in areas such as  Order-to-Cash, Procure-to-Pay, Customer Communications, and Inventory Management, and has saved more than €2M.

For Frenzel, the secret to success primarily lies in strategically involving process owners and executives from the very start. “Processes need to be radically changed,” says Frenzel, “and that requires support and understanding.”

Fueled by these early successes, Process mining has become a top priority for the management board: The Director of Operational Excellence and his team constantly seek and prioritize new value potentials with Celonis, transform them into business cases, and regularly share these with the board.

At the same time, they boost awareness and user acceptance by using Celopoly - a board game that explains process mining in a playful way. Backed by Conrad’s executive board and teams across Conrad, Frenzel and his team have ambitious plans for the future.

Vision: From improving processes to re-inventing them 

Currently, over 100 Conrad employees are working with Celonis. By the end of 2023, Frenzel hopes, this number will double.

Additionally, Frenzel's team aims to double-down on their success in Order Management and Procurement, with the goal of unlocking at least €4M by the end of 2023.

And Conrad wouldn't be Conrad if the focus wasn't on continuous optimization. “Transformation is never done,” says Frenzel.

Together with his team and the different process owners, he plans to tap into value potentials in other areas such as Logistics and Fulfillment, Offer Management, as well as Billing & Collection.

“We don't just want to improve processes even further; we want to rethink and redesign them.”

Conrad's process transformation with Celonis is far from over.

Intrigued? Find out why Celonis is the market leader in process mining.