ERP IMPLEMENTATIUN AT BPCL

CASE ANALYSIS

ln 1931 Lhe CovernmenL of lndla enLered lnLo an agreemenL wlLh ukbased
8urmah Cll Company and Shell eLroleum Co (8urmahShell) for esLabllshlng
an oll reflnery ln 8ombay
8y november 2001 8haraL eLroleum CorporaLlon LlmlLed (8CL) had become
a leadlng player ln Lhe lndlan peLroleum lndusLry lL had successfully
lmplemenLed an LnLerprlse 8esource lannlng (L8) lmplemenLaLlon began ln
Aprll 2000 afLer Lhe company declded Lo lnLegraLe all lLs acLlvlLles Lhrough Lhe
L8 package SA 8/3
L8 ls sofLware drlven buslness managemenL sysLem LhaL helps Lo lnLegraLe all
funcLlons of a buslness lncludlng plannlng manufacLurlng sales and
markeLlng 1he hlsLory of L8 has lLs rooLs ln Lhe lnvenLory conLrol sysLems
developed ln Lhe 1960s Lo manage lnvenLory accordlng Lo LradlLlonal lnvenLory
concepLs Cver Lhe nexL few decades as buslnesses became lncreaslngly
complex and global companles came under pressure Lo lmprove Lhelr
compeLlLlveness by lowerlng operaLlng cosLs and lmprovlng loglsLlcs
Powever a ma[orlLy of L8 lmplemenLaLlon exerclses ln lndla proved Lo be
fallures 1here were reporLs of smallscale companles even belng drlven Lo
bankrupLcy AnalysLs aLLrlbuLed Lhe fallure Lo poor undersLandlng plannlng
and lmplemenLaLlon of Lhe sysLem and noL Lo Lhe lnherenL problem ln Lhe
sofLware
8CLs successful lmplemenLaLlon of L8 Lhus came as a ma[or rellef Lo L8
vendors and lndusLry waLchers Powever analysLs commenLed LhaL 8CL had
noL lmplemenLed L8 as a sLandalone sysLem buL had lnLegraLed wlLh Lhe
overall l1 lnlLlaLlves whlch lL had lnlLlaLed ln 1996 afLer Lhe resLrucLurlng
8CL dlvlded lLs l1 lnlLlaLlves lnLo a Lhreepronged sLraLegy whereln lL planned
Lo creaLe a communlcaLlon neLwork wlLhln Lhe organlzaLlon Lo creaLe a baslc
lnformaLlon neLwork for Lhe enLlre corporaLlon and Lo process LransacLlons
wlLh cusLomers all over Lhe counLry 1he organlzaLlon was resLrucLured Lo help
focus on speclflc cusLomer segmenLs and address Lhelr lndlvldual needs lor
Lhls 8CL needed a sysLem for speedy and effecLlve communlcaLlon 1o
lmprove communlcaLlon sysLems wlLhln Lhe organlzaLlon 8CL declded Lo
esLabllsh an lnLraneL
8CL also lmplemenLed varlous appllcaLlons Lo faclllLaLe lnformaLlon reLrleval
from corporaLe daLabase lL also lnLroduced Cuery by Mall (C8M) by way of
whlch remoLe users could exLracL buslness LransacLlons from corporaLe
daLabases 1hls sysLem helped conserve Lhe WAn bandwldLh and schedule
daLabase querles aL nlghL
1he L8 lmplemenLaLlon was parL of Lhe companys ro[ecL CuSLC (CusLomer
Servlce and SaLlsfacLlon) whlch had Lo meeL Lhe challenge of an lmbalance
beLween reflnlng and markeLlng 1he company selecLed SA 8/3 as lL was
already successfully belng used by mosL of Lhe ma[or oll companles ln Lhe
world lL was also Lhe only package whlch had an oll lndusLry speclflc package"
and an lndla speclflc package"rr
8CL appolnLed consulLanLs Coopers and Lybrand for Lhe plannlng process of
SA 8/3s lmplemenLaLlon 1he consulLanLs worked ln close coordlnaLlon wlLh
funcLlonal experLs wlLhln Lhe company 1he flrsL phase of Lhe lmplemenLaLlon
began ln Aprll 2000 r1he companys exlsLlng neLwork was redeslgned and
resLrucLured and all lLs branches were llnked Lo a cenLral connecLlvlLy cloud
1hls was done Lhrough rouLers and swlLches whlch were ln Lurn connecLed Lo
servers and worksLaLlons
8CL reallzed LhaL securlLy would deLermlne success of onllne buslness 8CL
ensured securlLy Lhrough Sun ulLra 3 flrewalls 8eal Secure lnLerneL Scanner
lloodgaLe Web 1rend and Web Sense8CL had also seLup a daLa warehouse
wlLh buslness ob[ecLs and querybymall
lrom november 2001 8CL became Lhe flrsL lndlan company ln Lhe oll
lndusLry Lo have lmplemenLed L8 Accordlng Lo analysLs 8CL managed Lo
compleLe Lhe L8 lmplemenLaLlon much ahead of lLs arch rlvals lCC and PCL
malnly because of lLs efforLs Lo sLreamllne lLs l1 lnlLlaLlves
SA 8/3 helped 8CL Lo successfully launch lLs eblz lnlLlaLlves Lhe flrsL of
whlch was Lo allow lC cusLomers Lo Lrack Lhe sLaLus of Lhelr orders onllne
1hls noL only allowed Lhe company Lo reLaln exlsLlng cusLomers buL also
helped ln aLLracLlng new cusLomers Accordlng Lo company sources 8CLs
blggesL advanLage from Lhe L8 lmplemenLaLlon was regardlng Lhe
managemenL of lnvenLory 8efore L8 lmplemenLaLlon Lhe companys pracLlce
of monLhly lnvenLory revlews frequenLly led Lo Llme lag ln processlng orders
Powever afLer L8 Lhls problem was eradlcaLed lL was now posslble for Lhe
company Lo know Lhe deLalls of recelvable of lnvenLorles whlch ln Lurn made
cash managemenL also easler 1he company expecLed Lhe L8 Lo achleve a
payback by 2003
8efore Lhe successful lmplemenLaLlon of SA 8/3 aL 8CL Lhe L8 markeL had
been proclalmed dead by many analysLs because of Lhe number of fallures of
L8 lmplemenLaLlon exerclses LxperLs halled lmplemenLaLlon as Lhe revlval of
Lhe L8 markeL ln lndla
WlLh Lhe successful lmplemenLaLlon 8CL cusLomers could access lnformaLlon
and do buslness onllne whlch enabled 8CL Lo lncrease lLs share of lC
cusLomers from 149 ln 2000 Lo 138 ln 2001 AfLer Lhe L8
lmplemenLaLlon 8CLs revenues grew by 228 ln 200001 even as Lhe
revenues of Lhe peLroleum lndusLry decllned by 34 1hus Lhe
lmplemenLaLlon of L8 helped ln Lhe successful funcLlonlng of 8CL