Work in progress

The UAE's Al Shirawi Group has just started its Oracle ERP project. ACN spoke to its IT head to get an insight into the decision-making and planning processes around the deployment.

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By  Eliot Beer Published  June 17, 2007

|~|chaturvedi200x.jpg|~|Chaturvedi: The board had a feeling that our systems were not able to deliver on the business’s requirements.|~|The Al Shirawi Group in the UAE is in an enviable position – it found itself needing a new ERP system, to cope with the dramatic growth its divisions were seeing.

In the Middle East’s booming economies, more and more companies are being forced to scale their systems to meet new business requirements, and Al Shirawi Group’s eight companies – each with several business units – is a good exemplar.

“There is a very wide variety of business types across the companies, a very broad spectrum of industries,” says M Chaturvedi, director of IT for Al Shirawi. “These industries consist of manufacturing, trading, projects, air conditioning.”

He says the impetus for the ERP project came from the group’s board of directors. They felt the group needed a more cohesive approach to data and information from its companies – the current systems deliver company data in a rather different format to that desired by the directors.

“The board of directors wanted to consolidate everything on one system,” explains Chaturvedi. “They had a feeling that the business was growing, and our systems were not able to deliver on the business’s increasing requirements.

“There were a couple of factors which drove the need for the E-Business Suite, but the main factor was that our growth rate is very high. Our existing ERP application, running on Informix, was age-old, and failing; we needed a scaleable application, so we had to use state-of-the-art systems – we needed to make the business more competitive,” he adds.

Once the decision had been made to go ahead with the ERP project, Chaturvedi and his team set out the parameters for the project, and some processes for making vendor and partner decisions.

“We decided on a high-end ERP system which would fit our requirements – we did not consider any mid-sized systems, as we knew our growth was extremely high, and we needed to look to our requirements for the next five years,” he says.

“We shortlisted the ERP applications which would fulfil our needs – we shortlisted Oracle and SAP, and then opted for Oracle E-Business Suite.”

The Al Shirawi IT team then selected the hardware platform for the new systems, shortlisting HP, IBM and Sun servers.

Chaturvedi set out a number of factors, including issues such as reliability, fitness of purpose, support quality, and the viability of the vendor and its local partners – each factor was weighted according to its importance to the group’s needs.

“We had eight factors in total, all weighted – each system’s factors were given a score by at least ten people,” says Chaturvedi. “We voted, and we worked out a final investment criteria – after this, HP came out top. There was quite a big margin between HP and the second-placed vendor – HP scored pretty well, over 80%. IBM was around 72%, in comparison.”

Chaturvedi’s other main decision was which partner to choose for the implementation. His final choice – L&T Infotech – came from a number of factors, but primarily L&T’s understanding of Al Shirawi’s core businesses and industries.

“The main reason for selecting L&T Infotech was their knowledge of our industries – we are largely in the manufacturing and projects business, and they are in a similar business,” Chaturvedi says. “There was a synergy between our industry profiles.

“The second reason is that Infotech drives out a lot of technology from its own parent company. That company provides a lot of input on standards to L&T Infotech – these standards will transfer to us. This is one of the major factors we took into consideration.”

Chaturvedi and his team were also impressed by a visit to L&T’s Bangalore operations centre, where the integrator has around 1,000 Oracle-trained personnel.

Having made the key decisions as to vendors and partners, the Al Shirawi IT department began the project itself in April 2007. The team completed the requirement definition phase last month, and is now working on the solutioning phase.

“We will then go to a build-up phase, followed by testing, and then we will go live,” says Chaturvedi. “Everything is on schedule, and we expect to go live by December this year, after completing the build-up phase by September.”

The company has opted for a two-phase approach to the ERP project – once the current phase one is complete at the end of the year, covering around half of the group’s companies and business units, phase two will start in January 2008, expecting to conclude in September or October that year.

This will enable the group to learn from the initial Oracle implementation, hopefully ensuring the second phase is even smoother than the first.

Aside from data, Al Shirawi will be taking no technology from its existing Informix-based systems, according to Chaturvedi: “When we do the migration, we will go completely to the Oracle suite. The data migration process is well-defined – when we start this, we are also considering using a data cleansing service, so we transfer completely clean data to the new system.”

The major challenge Chaturvedi expects is not on the technology side, but with the group’s employees – 500 of the 5,500 total staff members will be using E-Business Suite when it goes live, rising to 800 as the company expands its businesses in the coming months and years.

“The main challenge we will be facing is our users’ acceptance of the new system – it will be totally different compared to our old system,” he says. “User acceptance, user training, and user perception – these are the challenges, and the process is slow.

“We are expecting the implementation to finish on time, but we don’t know how long it will take the users to get used to the system – so we are planning a lot of hand-holding and training exercises after the implementation is complete.”

The Al Shirawi project is a work-in-progress: ACN will be revisting the implementation when its first phase is complete in 2008. This is a new approach for ACN case studies - email us with your comments:||**||

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