Saudi Arabian conglomerate Al Osais Group is looking to cut costs by up to a third by deploying SAP’s enterprise resource planning (ERP) software across its companies.
The contract’s value was not disclosed, but executives described the project as a significant one for the group, which expects to turn over 1.2 billion Saudi riyals (US$320million) this year.
For the first phase of the implementation, due to start in June, Al Osais will deploy SAP’s Engineering, Construction and Operations (EC&O) solution in the group’s two largest companies: construction company Al Osais Contracting Company and industrial services company Anabeeb.
This phase will last around eight months, with the ERP suite then rolled out to the group’s other 11 subsidiaries – the whole project lasting around two years.
Fouad Nazmy Fouad, IT group manager for Al Osais Group, told
IT Weekly
the SAP software would replace a mixture of an older system and some tailored applications.
“We cannot continue competing with other companies unless we have a highly integrated ERP solution,” he said.
Switching to SAP would provide cost savings of ‘30% or more’ of the total budget for the group, Fouad said, with other benefits including improved productivity, project control, forecasting and planning.
Using the SAP ERP solution would help to cut costs, he explained, as it would allow the company to control costs and to compare the estimated costs of projects with the actual costs through real-time reporting.
Fouad said the group had also looked at Oracle’s ERP solution but “we found SAP is better than Oracle”.
Another major factor in selecting SAP’s solution rather than Oracle’s, Fouad said, was that the group needed to do a change management or reengineering project during the implementation and felt SAP was the better choice for this.
In a statement announcing the deal, SAP Arabia’s president Essam Enany said: “Al Osais implementation of SAP’s EC&O solutions is a first in the Kingdom and we will witness a growing number of organisations within the same market segment adapting SAP, especially when they hear about the immediate benefits that it will bring to Al Osais Contracting.”
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