ONGC Case Study

Deriving business benefits from IT is not new to ONGC. Company is using SAP R/3 ERP since 1996 for finance function and in 2004 extended SAP for HR function and administration. ONGC used a PC-based legacy system for material management, project monitoring and maintenance planning. Information is as valuable as oil for ONGC and sometimes, hard to locate. Due to multiple IT systems, holding same data, it was difficult to identify the correct information and take a correct decision.

However such piecemeal implementations were never going to be enough, said Subir Raha, the chairman and MD (CMD). With an intent on integrating all functions of the company under one umbrella, he started a project to implement SAP at enterprise level, with the motto One Data One System. Raha had his reasons. Despite the earlier implementations, the company suffered from lack of availability of real-time information. Monthly reports generated were not enough to take forward looking managerial decisions.

ONGC felt the need for a solution using IT to streamline the business process and integrate all information along the business process of enterprise core business. Thus the project ICE (information for consolidation and efficiency) was born. A six-month study, undertaken by software major SAP, recommended that all operations and offshore business operations of ONGC had to be integrated into a single SAP system by implementing mySAP.com e-business solutions covering five regions and 8500 users of ONGC. The move towards an ERP package was to enable the availability of information on a real-time basis and eliminate duplicate activities across the organization. Keeping this as an imperative, ONGC aims to take maximum advantage of the state-of-the-art technology for leveraging productivity and thereby profits. It covered solutions for financials, business intelligence, supplier relationship management, enterprise portals (for workplace), HR management, CRM, SRM, strategic enterprise management and product life cycle management. With the e-business suite in place, suppliers were able to transact with ONGC at any time and from any place, beginning from enquiry stage till payment is received, while customers were happy as they spent less time in identifying the stock, tracking their order and making timely payments. Looking at the benefits derived by SAP implementation, ONGC added the ESS (employee self-service) module covering 36,000 employees, making it one of the largest ESS implementations in India. ONGC gained in a big way by maintaining optimum inventory and ensuring suppliers were paid on right time. Information was available to management at finger tips, at any time when required; to make decisions at all levels.

Use the case analysis framework given below to present your proposal and in the process cover these points: why CMD had to come up with the motto of One Data One System and examine mySAP.com e-business has helped in improved CRM and SRM and ONGC at large.

a) Executive Summary of case analysis

b) Problem Statement

c) Alternatives

d) Criteria for evaluating alternatives

e) Evaluation of alternatives (on basis of listed criteria)

f) Recommended Solution

g) Contingency Plan (if recommended solution doesnt work out)

h) Learnings from the case