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From Legacy of Dynamics AX to Leading System Edge: Pigeon Indonesia's Upgrade to Dynamics 365 BC for Integrated Production and Costing
25 June 2026
Case Study
Pigeon Corporation is a Japanese company specializing in manufacture, sales, import and export of various child and baby care products, women's care, maternity items, nursing care, and child-minding center operations. It was established on August 15, 1957, in Tokyo, under the name Pigeon Honyuki Honpo, which started off as a nursing bottle manufacturer business. Until 2026, the business expanded worldwide in Americas, Europe, Africa, Middle East, and Asia-Pacific, with an Indonesian subsidiary operating under the name PT Pigeon Indonesia. Pigeon Indonesia was first established in 1995 as a joint venture and became a consolidated subsidiary in 2017, serving as Pigeon's primary product distributor and manufacturer in local scale.
Pigeon Indonesia's journey with NSIDN started in 2019, when NSIDN introduced Microsoft Dynamics 365 Business Central as a modern replacement to Pigeon's pre-existing Microsoft Dynamics AX system. The system upgrade was a part of Pigeon Corporation's agenda for a broader regional rollout from the headquarters to their Southeast Asian branches in Thailand and Indonesia. In this initiative, NSIDN was appointed as Pigeon's system integrator and consultant for their local project in Indonesia.
The initiative is a broader regional rollout agenda from Pigeon Corporation's central headquarters, aimed to upgrade their previous Dynamics AX-based system that had reached their end-of-support. Following the initial contact and proposal in 2019, the Microsoft Dynamics 365 Business Central implementation project first kicked off in March 2020, where the entire project spanned for 18 months, until the finalized go-live in July 2021. The project itself covered several key phases that included initial discussion, basic planning, basic design and development processes. Final products for the initial completion process delivered the core functions of supply chain management, accounting, and costing modules, all deployed within Pigeon's on premise-based environment.
The modules of Microsoft Dynamics 365 Business Central include:
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Supply Chain Management moduleManages the flow of goods and materials throughout the purchasing, inventory and sales-distribution pipeline, allowing Pigeon Indonesia to optimize their stock levels, track goods and items and ensure on-time delivery process.
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Finance and Accounting moduleThis module handles all financial transactions done by the company to ensure accurate records and compliance, including general ledger, account payables, cash management and financial reports.
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Costing moduleEnables tracking and allocation of costs related to production, inventory, and other company operations, allowing Pigeon Indonesia to analyze their profitability, control their expenses, and create faster and better operational decisions.
The design and development process are adjusted according to the Indonesian business compliance needs, including value-added tax (VAT), income tax, withholding tax, and other localized functions.
Prior to the transition, the Dynamics AX-based system was unable to generate the necessary costs, and the costing process was exclusively done manually. Through the upgrade to the new D365 Business Central software, costs are now able to be generated with computer-based system and enhanced the overall business process with automated costing.
After the go-live phase in 2022, the current Business Central-based ERP system is still solidly in use within Pigeon Indonesia's management alongside the regular annual technical services conducted by NSIDN.
In the future, NSIDN and Pigeon Indonesia are planning to expand their existing production system by implementing a new Materials Requirement Planning (MRP) module, which will become a part of the production planning module. This aligns with Pigeon's upcoming business plans to upgrade the quantity and quality of their production process to increase the overall company productivity.
Mr. Hans, part of Pigeon's IT team, stated that the company has utilized Microsoft Dynamics AX (Axapta) since 2006. However, Dynamics AX had slowly fallen out of use in later years due to the lack of maintenance support and neglected database management. For example, calculating material requirement planning would require around 5 to 6 hours per day with the existing system. Afterwards, Pigeon Corporation moved out with the regional rollout agenda from Thailand, requiring Pigeon Indonesia to upgrade its existing system to a new one supported by Microsoft's newer enterprise resource planning software.
Mr. Jauhari, Pigeon's project manager and part of its finance and accounting team, shared that based on his experience, D365 Business Central offers an integrated data experience that spans from the production to finance functions. Prior to implementing D365 BC, each business department and data tend to be separated by functions, and after the implementation, each data can be synced and viewed in real time for smoother business operations. Additionally, it reduces the chance of human errors and time needed for manual inputs, as well as offering clarity.
"With the addition of this new D365 Business Central-based system, our team can generate report in much shorter amount of time. Before the installation of BC, we would usually input our data by the end of the month, but now everything can be inputted and updated in real time, saving our time to create a more accurate reports at the end of the month," said Mr. Jauhari.
Discover how Microsoft Dynamics 365 Business Central can be custom tailored to your industry and explore how it can solve your challenges! For more information about NSIDN's D365 BC implementation and support, you can contact us on 0852-1535-7287 (mobile/WhatsApp) or send us an e-mail to sales@id.nssol.nipponsteel.com.