To fuel growth in Egypt’s economy, ERC wanted to move its new refinery into production on time and in budget. ERC chose SAP solutions to support operations—but how could it meet its tight deadlines?
ERC and IBM defined new business processes to help the company act as a globally integrated enterprise, based on comprehensive SAP solutions.
Deliverstransformation and change project on time
Enablesstate-of-the-art business management techniques
Drivescontinued economic growth
Business Challenge Story
Egyptian Refining Company (ERC) is developing a state-of-the-art USD3.7 billion refinery that will provide refined petroleum products such as diesel to Egypt’s domestic market. When construction is complete, the company will have the capacity to produce 4.2 million tons of refined petroleum products every year, and employ more than 700 people—helping fuel vital economic growth.
To bring its construction project in on time and within budget, ERC needed to enable its lean team to manage multi-million dollar resources effectively.
Wael El Oraby, Commercial Director at Egyptian Refining Company, explains: “ERC was founded with a mandate to provide Egypt with the energy resources it needs to drive continued economic growth. As a young company with a lean team, one of the earliest challenges we faced was managing our multi-million dollar resources—including construction materials, supplier contracts and human resources—effectively.
“Fulfilling our role of building the new state-of-the-art refinery requires us to liaise with numerous internal and external stakeholders, including the Egyptian General Petroleum Corporation, regulatory authorities and the contractors responsible for carrying out the construction work.
“Initially, we managed these relationships via phone and email. However, with so many moving parts involved in the project, we wanted to reduce the risk of delays by adopting industry best practices. The aim was to bring a standardized approach to all aspects of our business—from procuring materials for the refinery, to analyzing and evaluating our supplier relationships.”
Building on best practices
To meet its goals, ERC decided to design new processes to manage its business from end to end, supported by SAP® ERP software.
Ramy Harfoush, IT Manager at Egyptian Refining Company, continues: “Prior to our vendor selection process, we did a high-level requirements gathering exercise across the company, and determined the capabilities we needed to enable our business goals. SAP ERP was the only package that met our requirements for the construction project and beyond, and it contained industry-specific solutions for refinery operations. SAP’s years of expertise and substantial market share in the oil and gas industry were key reasons behind our decision to adopt the SAP solution.”
Wael El Oraby adds: “We are effectively building an entirely new business from the ground up, and we wanted to make sure it stood on a solid foundation. By adopting SAP ERP as the template for our new workflows, we were confident in obtaining the secure, scalable platform we needed to help ensure the long-term success of our new refinery.”
With strict deadlines looming, ERC looked for a partner with the skills and experience to help it to implement the new SAP ERP solutions quickly, and selected an expert team from IBM Services.
By combining the IBM’s delivery expertise with pre-assembled SAP Rapid Deployment solutions, ERC realized that it could adopt an assemble-to-order delivery approach to avoid time-consuming customization.
ERC was confident that the close strategic alliance between IBM and SAP would enable it to meet the demanding go-live targets around its SAP application deployment, and felt that IBM’s own considerable experience of SAP deployments worldwide would help it to satisfy its need for high security and dependable availability.
“We evaluated an extensive list of consulting partners in Egypt,” recalls Ramy Harfoush. “In particular, we were looking for partners with proven experience of implementing SAP solutions for oil and gas enterprises. What led us to engage IBM Services was the depth and breadth of their consulting experience, and IBM’s impressive global reach. With IBM Services we had the assurance that we would receive all the skills, resources and people we needed to make our SAP ERP implementation project a success.”
On time, within budget
Working in combination with consultants from IBM Services, ERC configured SAP ERP with applications for Financials, Controlling, Materials Management and Human Capital Management. To enable low-touch, cost-efficient management, ultimately, IBM will manage the entire software stack—including the operating system and SAP application databases.
Wael El Oraby says: “We were extremely impressed with the IBM team’s use of the Ascendant SAP methodology—a proven, standards-based approach to reduce risk and project timelines. At every stage—from requirements collection to quality assurance—the IBM team has thoroughly documented and tracked potential risks, and taken appropriate action to keep our implementation on course.”
Ramy Harfoush adds: “We see particular value in IBM’s commitment to change management. By engaging all stakeholders from the earliest stages of the project, IBM helped all parties to understand and work toward the project objectives.”
Today, ERC is on target to go live with its SAP ERP applications on time and within budget—enabling the business process management capabilities it needs to manage its state-of-the-art refinery project throughout construction and beyond.
Wael El Oraby concludes: “Our SAP ERP applications are the backbone of the business, and thanks to the IBM team, our deployment is going very smoothly. With SAP solutions driving our business processes, we are well placed to deliver the new refinery Egypt needs to drive its continued economic growth.”
About Egyptian Refining Company
Egyptian Refining Company (ERC) was founded in 2007 to address Egypt’s growing domestic need for lighter petroleum products, such as diesel. ERC aims to distil low value fuel oil and deliver it to Cairo, the heart of Egypt’s consumption market, reducing dependency on petroleum imports.
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