Selecting the right solution

The decision to overhaul an entire financial reporting structure is not always easy, however Fastlink says it has made the right move.

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By  Shankar Sharma Published  March 23, 2005

The decision was made in May 2003. Jordanian telecommunications firm Fastlink realised that its old system was no longer sufficient to cope with the growing demands of an expanding business. It had been using Microsoft Great Plains software for five years, but the time had come to replace it with a more robust solution. “We took a decision to simplify, standardise and automate a number of key internal processes in order to reduce operational costs and give Fastlink’s management a consolidated view of our finances and staff resources,” says Omar Said, CFO of Fastlink. Over the ensuing months, Fastlink analysed its business requirements. It reached a conclusion that greater functionality — especially in terms of budget, human resources (HR) and procurement— was of the essence. Third party consultants were approached and a number of offers were presented. After careful deliberation and the taking on board of the experience of other companies, Fastlink opted for Oracle’s e-business suite 11i. “We saw Oracle’s functionality and reliability and decided to go with it,” says Ehab Hafez, project leader and enterprise resource planning (ERP) manager, at Fastlink. Deciding to overhaul a complete financial reporting structure is not always easy, but Fastlink believes it has made the right choice. After going fully live in January 2005, the company is already beginning to reap the rewards. The previous system did not allow for much integration. That is no longer the case. “The procurement functionality was not integrated to budget or funds checking,” says Hafez. “It’s tightly integrated now.” The objectives of the implementation are now met. Current business requirements are accommodated, cycle time reduced, and Fastlink now possess greater capabilities for analysis using the new-chartered accounts. Extensive study of return on investment (ROI) from switching to Oracle has yet to be completed, but Fastlink is already experiencing reductions of up to 30% in procurement cycle. The company has also automated close to 80% of its operations. “All of which makes a considerable difference on Fastlink’s bottom line,” remarks Said. Furthermore, Fastlink now finds that the new system has provided it with greater leeway with chartered accounts. “We plan to change our chartered accounts, which are in nine segments,” Hafez explains. “The old system could only deal with ten segments, which was a limitation, whereas Oracle can account for up to thirty segments.” The implementation was completed in a phased manner. Core team training for implementation commenced in October 2003 and was complete within two months. The first phase covered financial, supply chain and integration to the point of sale. The end user training began in March 2004 and took almost a month. The first phase went fully live in April 2004. The second phase included Oracle training administration, HR, I-recruitment, self-services and payroll services. Any initial doubts from staff resistant to change are quelled by the latter change. Previously, employees (of which Fastlink boast around 1,000) had their pay slips administered manually and the process could take up to a week. Now, that, along with vocational leave and other personal services are all done online— and the workers feel the benefits. Moreover, many are thrilled with being able to cite Oracle training on their CVs. The second phase started in August 2004 and the system went live at the beginning of January 2005. Oracle is also impressed, as Hasam Dajani, vice president, Oracle Middle-East and Africa comments: “Fastlink has embarked on a long-term path to comprehensive enterprise intelligence, delivering for its management a true 360-degree view of the company’s finances, human resources, inventory and other key processes.” A tremendous amount of data migration has taken place — the migration of the opening balances from profit and loss statements for previous years for instance. The new environment is based on the Oracle technology platform, including Oracle Database and Oracle Application Server, which also powers Fastlink’s online portal used to update the companies’s one million-plus subscribers. Some historical data however remains within the old system for standby, as Fastlink deem them unnecessary for integration. “We had major issues with the old data itself,” Hafez points out. “So we decided not to go with the headache of re-consigning old data.” In addition to the data migration, Fastlink underwent major data cleansing as well. Almost 19,000 vendor codes were listed on the old system and the company discovered that a great deal of these were duplicates. An exercise in recoding all company items and assets followed. Despite the drastic re-structuring, the entire implementation process took less time than Fastlink initially envisaged. “The estimated time for the financials was around seven to eight months but we managed it in less,” Hafez tells. “Oracle also advised us that that HR would take longer than we managed, but we put in place our own internal plan which enabled us to go live earlier than expected.” The solution, nevertheless, is an expensive one, amounting to around US$ 900,000 in total. However, this is a considerably lower sum than what a number of Fastlink’s competitors have incurred, which are ten times greater in some cases. The hardware, which was obtained from HP, cost US$ 310,000, while the licence accounted for US$ 338,000. Fastlink set aside US$1 million for consultancy alone, but the figures read US$57,000 for the first phase and US$ 49,000 for the second phase, while HR consulting cost US$ 50,000. Overall, training and consultancy have totaled just US$ 220,000. “We were very dedicated towards the implementation,” Hafez elucidates. “We had the ownership and were responsible, which was an additional incentive for the team. Also, we had support from the top management.” This dedicated ERP team included Hafez himself, accompanied by two others. The trio is responsible for conducting the whole operation as well as completing the application. Documentation and analysis of the process have been ongoing from start to finish, with the ERP team reporting to the financial controller and finance department. Functional business knowledge twinned with IT technical knowledge is essential for such an implementation. These skills are complemented by thorough groundwork prior to the commencement of the entire process. Hafez believes all this is bearing fruition, “I started an awareness campaign before the implementation,” he states. “This planned the concepts, ERP and the data flow between the different modules of business and IT. Now, the IT people have very good business knowledge and vice-versa.” Indeed, the ERP team is now seeking to expand to five members due to an increase in scope, resulting in the covering and supporting of further applications. Knowledge transfer between Oracle and Fastlink is a key component to ensuring the implementation continues as a success story. Oracle specialists trained the core team of implementers, who subsequently trained the end users. Fastlink’s ERP team, however, does not rest on its laurels. They ensure their presence at all Oracle events to see the latest technology and features first hand, as well as attending courses at Oracle University. This enables them to possess the requisite skills to expand and maximise the solution. In turn, with an ever-growing customer base, a robust, scalable online portal to communicate information (including new services) is vital. Said believes his organisation has found the right solution. “The Oracle technology platform and Oracle E-Business Suite provided one ideal, integrated solution to meet these needs,” stats Fastlink’s Said. As for the future, Fastlink envisage yet more benefits, allowing for further leverage on the implementation. In addition to capitalising by implementing advanced modules, it can also keep performance indicators, balance scorecards and business intelligence between the systems. Future IT plans include expanding the integration between the different systems to improve storage space, for enterprise assets management and corrective maintenance for the company assets. Changing the system was therefore essential, as Hafez concludes: “The old system wasn’t stable even for such core processes. We weren’t able to extend or expand.”

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