By Matthew Southwell
Saudi Arabian healthcare organisation aims to improve operational efficiency by implementing Sage ERP.
|~||~||~|Saudi Arabian healthcare organisation, Ebrahim Almana & Bros., has implemented Sage’s enterprise resource planning (ERP) offering as it attempts to improve the operational efficiency of its hospital supplies and medical equipment division.
Through the centralised system, the company will be able to track orders and manage its inventory levels more efficiently, resulting in improved customer service levels.
Until January this year, the company ran its financials on an AS/400 application and its distribution cycle on locally developed, proprietary software.
“Prior to implementing Sage we had one software running inventory and receivables, while another ran payables and general ledger,” says Adil Shah, finance manager for Ebrahim Almana & Bros.
“The management felt that it was not getting the correct information. Therefore, we decided to implement an ERP system that would integrate our operational activities and ensure that information flows from one department to another,” he explains.
Najeeb Almana, managing director of Ebrahim Almana & Bros., explains that the healthcare organisation opted for Sage over market rivals, such as Great Plains and ACCPAC, for a number of reasons.
“Firstly, it best suited our functional requirements. Second, Sage is the preferred vendor of 3M, our major principal for hospital and medical supplies and equipment. Thirdly, we wanted a solution that offered a low cost of ownership and could be implemented quickly,” he says.
All sales information is hosted in the Sage system and accessible in real time by the company’s numerous offices. Each branch accesses the centrally hosted application via a Frame Relay connection provided by local ISP, Noornet.
Shah explains that Frame Relay was the best option available to the company as Saudi’s Internet infrastructure is neither reliable nor secure enough to ensure the seamless transfer of business critical data.
“We evaluated the wide area network (WAN) set up and found that in the Kingdom communications was the bottleneck. However, after looking around we found that Frame Relay is good enough to run the Sage application on,” he says.
The ERP application is already delivering a number of benefits to the Saudi company. For example, Ebrahim Almana & Bros. can track its inventory more effectively, which in turn allows it to deliver up-to-date information to its customers.
“We get a lot of orders from customers and if you don’t fulfil them they deduct payment. We found that [prior to the Sage deployment] a lot of things were coming back to our office, which obviously costs a lot of money,” Shah says.
Improved information availability also helps the company better service its government contracts, as it is able to fit into its buying cycles more effectively.
“Straight away we can monitor our pending orders. As we have many government clients it helps us fit in with their schedules,” explains Shah.
This streamlining of operations will, Shah hopes, eventually help Ebrahim Almana & Bros. cut costs.
“Our first objective was to get the system up and running. We will look at the decision support tools and the inventory management features because that will save on warehouse space and help the team sell better,” he says.
This cost cutting drive will be helped by the integration road map the company is following. A number of customers are already putting pressure on the healthcare organisation to integrate its ERP system with their own applications, while 3M is making similar demands. “One of our key customers is Aramco. They are forcing us to have a system that can talk to their system. This has not happened yet though because they are still implementing their SAP programme. Once that is running there will be scope for integration. Also, 3M is pushing us to integrate our systems with theirs through some sort of EDI so that we can exchange information more easily,” he says.
Although a web-based system would be the easiest way to achieve this integration, Shah explains that such an initiative is not possible until the standard of Internet communications within the Kingdom improves.
“Once Internet services are more stable and more secure in the Kingdom then we could possibly move to the Internet. However this is a long term vision that we have and will work towards,” he comments.
Internally, the company also has plans to make better use of the information that the Sage ERP is collecting. The company is currently looking for a third party vendor to provide an application that will integrate with Sage and deliver improved content management and data analysis for its 200 plus government and private sector accounts. This improved decision support will in turn boost the company’s competitive advantage.
“We sell a lot of equipment and we need to maintain records on what we have sold, where we have sold it and who we have sold it to. Sage does not allow us to do this so we are looking for third party software that can be integrated with Sage to fulfil our requirements in this area,” says Shah.||**||