Watertight processes

Saudi Arabia’s Saline Water Conversion Corporation (SWCC) has completed the first phase of a massive enterprise software implementation.

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By  Matthew Southwell Published  June 3, 2004

|~|swcc_m.jpg|~|“The biggest challenge we faced was changing the whole culture,” says Loay Bin Ahmed Al-Musallam, deputy minister for planning & development at the Ministy of Water & Electricity.|~|Saudi Arabia’s Saline Water Conversion Corporation (SWCC) has completed the first phase of a massive enterprise software implementation that will eventually see the government body roll out the entire Oracle E-Business Suite and Datastream 7i at 30 desalination plants across the Kingdom. The enterprise resource planning (ERP) application and asset management solution have already been deployed at SWCC plants in Jeddah and Al Khobar, and at its Riyadh headquarters. They were rolled out in just six months by an inhouse team, consultants from Ernst & Young and representatives from both Datastream and Oracle. SWCC’s IT investments replace a smattering of legacy applications and hundreds of manual processes. For example, asset management at the Jeddah plant was carried out using a CMMS system while Al Khobar used Excel spreadsheets. Such a set up was unable to help the government body reduce the cost of producing water, nor give SWCC the financial control it requires as it prepares for privatisation. “SWCC is the biggest in the world in terms of water production and number of employees, of which there are approximately 10,000. We have plants scattered across the Kingdom and we produce more than three million cubic metres of water per day. Although we had some small IT initiatives here and there, these were isolated islands and there was no integration,” explains Loay Bin Ahmed Al-Musallam, deputy minister for planning & development at the Ministry of Water & Electricity and head of the SWCC ERP team. “As the organisation gets bigger it would have become a bottleneck and we had to find a radical solution otherwise the plant, the employees and SWCC itself would suffer,” he continues. The accelerated implementation was achieved through effective planning ahead of the September 2003 start date. This period saw SWCC complete a business process-reengineering project, which meant it was able to roll out both solutions with little customisation. “We were able to implement the solution so quickly because we planned properly and spent time reengineering our business processes and streamlining them,” says Al-Musallam. “We also implemented the Oracle E-Business Suite and Datastream as it was with minimum customisation and we conducted a lot of training programmes while we were reengineering our processes.” While Al-Musallam reports that the Riyadh, Jeddah and Al Khobar implementations were relatively simple due to the groundwork carried out, the biggest challenge for SWCC was the change management aspect of the project. “The biggest challenge we faced was changing the whole culture of the organisation,” confirms Al-Musallam. “It is very important to change the culture otherwise you will fail. The challenge was doubled in our organisation because it is a government one, where you have to take staff who have been carrying out manual processes for 15 years and put them in a totally automated environment,” he adds.||**|||~||~||~|To ensure staff buy in, SWCC created a 150-strong cross-functional team of senior employees from across the Kingdom. This team worked with the consultants and was involved in the decision making process. It was also responsible for championing the project within the user community and building the trust required to make the switch to automation a successful one. “From the beginning we involved the employees, especially the head of departments and management. We asked them whether they wanted to be part of the change, whether they wanted to develop and whether they wanted to get something out of the change. Although there were some obstacles, we always found solutions and created and managed the complete change management process,” says Al-Musallam. “Although we also had a lot of workshops, seminars and a newsletter, change management is about more than memos. It is about delivering the message that motivates the staff and delivers objectives,” he adds. Prior to the ERP and asset management roll out, SWCC also established a GE Global eXchange Services electronic data interchange (EDI) network through which to interact with suppliers. Although it will eventually migrate to e-procurement once the E-Business Suite is live across the organisation, seven companies — two from Saudi and five from abroad — are already using EDI to transact with SWCC. Concurrent to the introduction of EDI, the government body also introduced blanket buying and reduced its supplier base from 9000 to 2000. As a result, it has increased its buying power and improved efficiency. Contracts now spell out the product quantity SWCC will consume over a two year period, which company will supply it and the price charged. “It cuts the purchasing cost by around 12% and it reduces the purchasing time significantly as it removes the need to go to different suppliers,” says Al-Musallam. “Also, it used to take up to 200 days to bring spare parts to the plant but using EDI we have reduced it to around 35 days and this will become even quicker when we move to e-procurement,” he adds. SWCC is already experiencing a number of other business benefits from its IT investments. Datastream 7i, for instance, allows SWCC to manage its assets and over 280,000 spare parts more effectively. It also allows the government body to create preventative maintenance plans and accelerate the execution of maintenance tasks. In turn, this reduces the manpower needed, which means staff can be redirected to value add projects. As for the E-Business Suite, it is availing SWCC of the benefits typically associated with successful ERP projects, such as improved financial control, greater corporate visibility and accelerated data access. “Having the system helps us speed up our maintenance and reduce costs. It also allows our management to get the information they need to make decisions,” says Al-Musallam. As these benefits will only increase as SWCC’s remaining plants go live, Al-Musallam is confident the government body will generate a huge return on investment (ROI) on its IT spend. “The pay back period for the system is, on average, eight months and the ROI will be around US$69 million,” he predicts. Furthermore, Al-Musallam believes the success of SWCC’s project will act as a reference point for other public bodies, thus helping Saudi accelerate its entry to the wider knowledge economy. “We have a success story now, so whatever obstacles are keeping other government organisations from taking a similar step can be overcome,” he says.||**||

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