Case Study

Ambuja Cements
ERP Masonry Connecting 200 locations, training 2,500 end-users, and migrating data from 8
different legacy systems onto the ERP all in 14 months flat.

One of Indias largest cement manufacturing companies, Ambuja Cements has taken many IT
initiatives to integrate the latest technologies into its operational systems, so as to reap business
benefits at every level of the supply chain. The IT team at Ambuja has always been forthcoming
in experimenting new technologies. For eg, in 2001 the cement company was one of the first to
deploy Red Hat Linux at remote sites for critical business applications.

Trend-setter
Last year, Ambuja Cements launched Connect India Plus, which has proved to be one of the
most significant, large scale IT deployment within the company so far. As the company’s
manufacturing plants are located in remote areas where the scope of connectivity was minimal,
the resources, namely hardware, software and people were located at plant sites. The overall
integration of data was transferred and carried out in batches. During 2006, Ambuja decided to
go for SAP as it is a standard system for all group companies.

Within two years, Ambuja rolled out Connect India Plus that was conceived as an ERP
implementation program for installing SAP with all its modules at 200 locations across India and
2,500 users with a single instance on a server in Mumbai. The project kicked off on June 1, 2007
and went live on August 1, 2008a period of just
fourteen months.

One of the prime reasons for deploying this ERP was

to have a uniform, standard, and ubiquitous system
across the organization not only in India but abroad,
so that Ambuja Cement could easily align with other
group company processes, says Bihag Lalaji, CIO,
Ambuja Cement. The project also promised a
reduction in cost of operations and maintenance of the
IT system. It would also enable Ambuja Cements to Bihag Lalaji, CIO, Ambuja Cement
respond quickly to changes in the business  Deployed Connect India Plusan SAP
environment. ERP implementation program across
200 locations to connect 2,500 users
Challenges  The enterprise wide ERP went live in
However, the IT team faced immense challenges a period of just 14 months and
helped Ambuja easily align with
while implementing this enterprise-wide ERP. Since other group company processes
the company had multiple plants, each with their own
computer systems and processes, there was a need to
create a single business blueprint across the organization. On the people front, there was a need
to integrate individuals with diverse background to be able to work as a focused team.

Besides the core team consisting of 75 members, there were 150 people involved indirectly or
directly for data migration, training, etc. All this required enormous amount of man-management

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skills. Infrastructure refreshes was another critical challenge as the IT team took on the task of
setting up an adequate and reliable WAN using MPLS and VSATS, connecting 200 locations
including factories, bulk cement terminals, grinding units, regional offices and warehouses.

Data migration was another major challenge since data had to be imported from eight different
legacy systems. The standard master data codes had to be mapped with the legacy codes and data
had to be updated at one go. We had a dedicated team and full support of business users from
various locations, who worked relentlessly to achieve this mammoth task, says Lalaji.

After the successful implementation of SAP, the company has been exploring some cutting edge
technologies to improve supply chain. It has implemented a sophisticated smart-card based
vehicle tracking system to improve operational efficiency in terms of cycle-time monitoring and
fleet management. This has helped the company determine the exact cycle for a vehicle carrying
cement from the factory to a destination and carrying raw material as a return load back to the
factory. The information is dispatched to customers via SMS.

Case Study Questions

1. What are the challenges companies’ experiences in implementing ERP systems?

2. What are several key things companies should do to avoid ERP systems failures? Explain
the reasons for your proposals.

3. Why do you think ERP systems in particular are often cited as examples of failures in IT
systems development, implementation, or management?

Prof. Prasad Desai Page 2