ERP POPOSAL FOR HPCL-SAPGroup

Vivek Srivastava

Meethu Mohan

Kalyan Prasad

Prabhu P

Reema G

HISTORY OF SAP

Systems Applications and Products in Data Processing

Founded in 1972 by Wellenreuther, Hopp, Hector, Plattner and Tschira Re named in 1977 Before 1977 : Systems Analysis and Program Development

(German : Systemanalyse und Programmentwicklung)

SAP is both the name of the Company as well as their ERP Product

SAP system comprises of a number of fully integrated modules, which covers virtually every aspect of the business

Three systems developed : R/1, R/2, R/3

ABOUT HPCL

Hindustan Petroleum Corporation Limited (HPCL), whose roots go back to 1952, is today operational in the oil refinery and LPG distribution space.

A Fortune 500 company, HPCL recorded an annual turnover of over Rs 91,448 crores for the financial year ended March 2007.

Currently, the company enjoys a 16 percent refining and marketing share in India and a strong market infrastructure.

2 Refinaries : 3 Million Metric Tonnes per annum 80 regional Offices, 20 terminals, 120 Depots,

8900 retail outlets

OPERATIONAL AREA OF HPCL1) Financial accounting (FI)

2) Asset management (AM)

3) Materials management (MM)

4) Sales and Distribution (SD)

5) Production Planning (PP)

6) Quality management (QM)

7) Plant maintenance (PM) & Customer Service (CS)

8) Human resources (HR)

CURRENT SITUATION

1.Issue in Employee management2.Human right issues, rehabilitation issues3.High Competition from other players Bharat Petroleum 

IOCL Reliance Industries ONGC

4.Improper pricing mechanism

5.Reducing income constraining further investments

6.Increasing competition from private as well as other PSUs

7.Inefficiencies in retailing outlets leading to loss of customer satisfaction

SO WHAT NEXT....

SOLUTION To Problems

ELSE

WHY SAP(HOW DIFFER FROM OTHER ERP) 1. Vast array of modules, with huge spectrum of functionalities

which ARE NOT PROVIDED by other ERP applications. 2. Specific functionalities which are core competencies of SAP while

they are not available in other ERP applications, makes it an obvious choice for some specific industries. Eg. Variant configuration and Automobile industry.

3.SAP knowing the demand for special processes for each industry has come up with industry specific solutions which are unheard of from other applications.

4. Not only on the functionality side, but also on the system architecture and landscape SAP is innovating day by day from R2 to R3 to ECC to SOA, to adopt to the business needs, thus adding immense value to the customers.

5. SAP also gets complimented by most ubiquitous office applications of MS namely MSWord.

  6. Also SAP's market share gives some certainty of business and

hence it is much better than any other smaller ERP applications in terms of career prospects.

BENEFITS OF SAP ERP

SAP ERP delivers a comprehensive set of integrated, cross-functional business processes. With SAP ERP, you can gain the following benefits:

Improve alignment of strategies and operations Improve productivity and insight Reduce costs through increased flexibility Support changing industry requirements Reduce risk Improve financial management and corporate

governance Optimize IT spending Gain higher ROI faster Retain top performers Provide immediate access to enterprise information

PROPOSED SAP MODULES

SAP R/3

FI

WF

PS

PM

WM

PP

MM

SD

HR

AM

CO

QM

PP – Production Planning

WM – Warehouse Management

PM – Plant Maintenance

AM – Asset Management

PS – Project System

MM – Materials Management

SD – Sales and Distribution

QM – Quality Management

WF – Workflow

HR – Human Resources

CO – Controlling

FI – Financial Accounting

MMMaterial Procurement

Inventory ManagementBatch ManagementGoods inspection

Invoice Verification

PPBOM/Work Center/Routing

MRPCapacity Evaluations

Production OrdersQM in production

SDInquiry processing

Sales Order ProcessingDelivery Processing

Billing

FIGeneral Ledger

Accounts PayableAccounts receivableCash management

COCost Center Accounting

Product CostingOrder Contribution Analysis

Module Functionalities for HPCL

SALES AND DISTRIBUTION PROCESSINGM

A T

E R

I A L

S M

A N

A G

E M

E N

T

Sales Order Process(Order-to-Cash)

Sales OrderEntry

Post Goods Issue

Invoice Customer

Pick Materials

Receipt ofCustomer Payment

Pack Materials

Check Availability

Procurement Process (Procure-to-Pay)

Purchase Requisition

Paymentto Vendor

Notify Vendor

VendorShipment

InvoiceReceipt

GoodsReceipt

Purchase Order

MATERIALS MANAGEMENT

Service /spare parts

Material Special stockBatch

Vendor/one-timecustomer

Purchasinginfo record

Servicespecifications

Workflow

Optical archive

TextsMailCommunication

Classification

Documents

Conditions

BASIC DATABASIC DATA

Pu

rch

asin

g i

nfo

rmat

ion

sys

tem

Ven

do

r ev

alu

atio

n

Purchase requisitionPURCHASINGPURCHASING

MRP Direct requisition Release procedures

RFQ/Quotation Material/service Price comparisons Price comparison list

Purchasing Purchase orders Outline agreements Scheduling agreements

Goods receipt/issue Transfer posting Quantities and values Physical inventory Storage bins

Check and post Price update

INVENTORY MANAGEMENTINVENTORY MANAGEMENT

INVOICE VERIFICATIONINVOICE VERIFICATION

SD

PP

PM

QM

FI

AM

CO

PS

Third-partyorder

Requirements

Inspection lot

Fixed assets

Cost center /Budget

Project

G/L accountsCash managementand forecast

Service/ Spare Parts

FI CO HRCostaccounting

Financialaccounting

Humanresources

ProjectNetworks

MaintenanceRepairsPlant maintenance

Inbound Raw Material

Finished Goods

Sales and Operations PlanningDemand management / MPSMaterial requirements planning

Detailed Schedeling and PlanningCapacity planningShop floor controlCostingInformation system

PurchasingWarehouseInvoice verification

SalesShippingBilling

Customers

Vendors

SDPP

SDSD

SDMM SDQM

SDPM

SDPS

PRODUCTION PLANNING

• PS – Project Systems• Support planning, control, & monitoring of long term highly complex projects

with defined goals

• Key elements • Project WBS – Plan• Budget & Monitor• Network Management • Activity monitoring, Material Planning, Milestones, Capacities Scheduling• Project Management Information System

• HR – Human Resource• Key elements

• Recruitment• Payroll & Time management• Travel Expense accounting & Benefits• Workforce planning & Training administration• Organization management

Module PS – Project System & HR – Human Resource