SBN Energy Day Full Scale S/4HANA and SAP Ariba Implementation at Dragon Oil
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SBN Energy Day Full Scale S/4HANA and SAP Ariba implementation at Dragon Oil 09.03.2021 Presenters Johannes Wiik Abhisek Pandey Piyush Mistry EMEA Lead Partner for Nordics Lead Partner for Senior Manager Energy, Resources & Industrials Energy, Resources & Industrials Deloitte Middle East © 2021 Deloitte AS 2 Introduction Copyright text 3 Dragon Oil At a glance Dragon Oil is an upstream oil and gas exploration, development and production company. The Group’s headquarters are in Dubai, United Arab Emirates. It is a privately held and wholly owned subsidiary of Emirates National Oil Company (ENOC) L.L.C. Dragon Oil’s operational focus remains clear and consistent in delivering on a three-point strategy: Accelerate the development of Develop opportunities for gas Explore value-enhancing acquisitions the Cheleken Contract Area within diversification strategy © 2021 Deloitte AS 4 Dragon Oil At a glance ▪ Principal producing asset is the Cheleken in the eastern section of the Caspian Sea, offshore Turkmenistan. PRODUCTION BLOCKS ▪ Oil production level of 60,000 -75000 barrels per day. ▪ DO is the Operator for this field. ▪ 100% owned, no Non-operators. ▪ Dragon Oil has interest in other exploration blocks in partnership with other companies which includes: − Onshore in Iraq (Block 9) − Onshore Algeria (Tinrhert Nord Perimeter and Msari Akabli Perimeter) EXPLORATION BLOCKS − East Zeit Bay, offshore the Gulf of Suez, in Egypt − Onshore in Afghanistan (Sanduqli and Mazar-i-Sharif blocks) − Offshore Tunisia (the Bargou Exploration Permit) © 2021 Deloitte AS 5 Business Transformation objectives Achieve enterprise-wide Process standardization by implementing simplified processes aligned to leading practices Industry leading Digital platform to support future innovation Established controls around Turnkey /Capital Project & Expense Management. Enhanced data quality & governance processes across critical master data i.e Material, Suppliers Better Workforce experience with a full roster of HR self-service capabilities © 2021 Deloitte AS 6 Dragon Oil SAP Transformation Implementation scope Capped Customization effort 32 2,500 for Tax, Legal, Compliance and SuccessFactors Companies Employees Enterprise Value Driven Requirements Ariba Concur 600 200+ Pre-Configured Users Processes Solution Upstream Accounting Financials 5 2,400 Inventories Suppliers Material SAP S/4 Human Capital Management HANA Management Plant Maintenance Project Systems 25,000 35,000 Material Master Asset Master Best Practices Records Records © 2021 Deloitte AS 7 Application landscape & Interfaces Landscape Interfaces Geographies SF Recruitment Third party applications / Interfaces SF Onboarding Management Turkmenistan SF Payroll SF Employee Central Bank / Payment SF Performance United Arab Emirates Concur Goals TIME ATTENDANCE Egypt Hana Cloud Hana SAP Ariba Algeria Tunisia SAP Enterprise SAP Finance Asset Management Iraq SAP Materials SAP Controlling Management SAP Joint Venture SAP Warehouse United Kingdom Accounting Management Premise - SAP Project System SAP FIORI On © 2021 Deloitte AS 8 Solution & Process View Finance Supply Chain Management Human Resources Information Management and Apps SAP Finance and Controlling, Joint Venture SAP Material management, SAP HCM, SF Employee SAP internal DMS, SharePoint, O365, Accounting, Project systems Warehouse management, Fiori Central, Payroll , Concur, Fiori On S4 HANA On S4 HANA PMGM, Recruitment & Onboarding Budgeting Taxation Planning Recruitment & Onboarding Reporting Document Management Receivables Management Reporting Sourcing and Procurement Employee Self Service Mobile Apps Inventory management Payables Management Joint Venture Accounting Leave Management Logistics Fixed Assets Management Time sheet management Third Party Applications General Accounting and Warehouse Management Visa & Permit Management Closure Cash Management Loans & Benefits Medical Services & Insurance Enterprise Asset Management SAP Enterprise Asset Management SAP Ariba Training Goal Management Notification creation & Equipment Warranty Supplier Lifecycle processing management Management & Performance Performance Evaluation Maintenance order Management Equipment tagging creation & processing Payroll Management Strategic Sourcing Preventive maintenance Analytics & KPI Travel strategy & planning Ariba Buying Expense Spares Management Commerce Automation © 2021 Deloitte AS 9 Business Outcomes Copyright text 10 Business outcomes Budget control ISSUE ESTIMATED NET ▪ Limited control on budget and expenditure visibility FOR Capex Projects. SAVINGS OF SOLUTION ~25% ▪ SAP IM (Investment Management) and PS (Project System) module ON EPC & INFRA implemented for controlling project CAPEX and Provisioned WBS hierarchy; PROJECTS enabled spending control against plan. ▪ Standard SAP reports for planning activities and commitment reports at ~90% Cost element level with possible corrective actions at any time. IN MANUAL EFFORTS OUTCOME ▪ Automatically activated Fiori tiles approach. ▪ Reduced the overall processing time by 50% to complete the process. © 2021 Deloitte AS 11 Business outcomes Supplier qualifications and payments ISSUE ▪ Errors as a result of the supplier invoices and payments being raised and approved outside the system. DIGITAL PLATFORM ENABLING SOLUTION ▪ Deployment of SAP Ariba for Supplier onboarding, Sourcing, Contracting ~90% and Commerce Automation. OF SUPPLIERS TO RAISE INVOICES AND GET PAYMENTS OUTCOME ▪ The digital platform enabling all strategic / registered suppliers to raise invoices and get payment via portal ▪ Ensured audit trail maintained across all transactions. © 2021 Deloitte AS 12 Business outcome Implementation of Warehouse Management module ISSUE ESTIMATED NET ▪ Inefficient storage of materials due to unproperly structured warehouses SAVINGS OF and bins ~60% IN GOODS’ ISSUE SOLUTION PROCESSING TIME ▪ Entire inventory management & warehouse management restructured ▪ Entire material master data streamlined to include all relevant data on storage and material requirement planning. ~10% ▪ An “Auto Stock Transfer” solution implemented IN TRANSIT INVENTORY LOSS OUTCOME ▪ Significantly reduced processing time of goods issue ▪ Minimized inventory loss in transit © 2021 Deloitte AS 13 Business outcome Project specific procurement and materials management ESTIMATED NET ISSUE SAVINGS OF ▪ Missing ability to manage inventory by project. ▪ POs for CAPEX projects issued without any reference to projects resulting ~40% in diminished visibility on inventory consumption. IN INVENTORY CARRYING COST SOLUTION ▪ Separate storage location and warehouse for CAPEX projects created. ~20% ▪ All the Purchase Requisitions / Purchase Orders issued against projects. IN SPARES’ created by referencing project / WBS number. CONSUMPTION AND ▪ A custom FIFO solution implemented. MATERIALS’ WASTAGE OUTCOME ▪ Lower inventory carrying cost due to improved tracking. ▪ Unnecessary consumption of materials / wastage reduced. © 2021 Deloitte AS 14 Project Methodology & Timeline Copyright text 15 Timeline & phases Nov 19 – Dec 19 Dec 19 – Feb 20 Feb 20 – Oct 20 Nov 20 – May 21 Go Live Plan Explore Realize Deploy Run EVD Project Project Business RICEF Integration User Go live Data Issue Register Authorization Plan Charter and Blueprint Test Acceptance readiness Migration Matrix Key Activities Key Controls Test Stage Gate Stage Gate Stage Gate Stage Gate Post Implementation Review Review Review Review Review Quality Assurance © 2021 Deloitte AS 16 An integrated methodology for Continuous improvement We limited customizations to strategic differentiators and managed to build a strong foundation. Oil and gas knowledge, S/4HANA , SF, Tested playbook to adjust your Embedded integration for pipeline lease Commitment to bring the right Ariba qualifications, and cultural fit for solution for future acquisitions management team for project guidance Dragon Oil Support to strengthen your Productive collaboration with other Tax integration that reveals global processes with lessons we’ve vendors like Dragon Oil IT and SAP tax opportunities for Dragon Oil’s learned from past engagements MLP structure Greater program benefits + Reduced risk © 2021 Deloitte AS 17 1 7 Tools & Accelerators Industry Prints Dleaps PMC DCUT ALM Deloitte leading industry Deloitte SAP-certified pre- Provides end-to-end visibility Deloitte Cutover Tool A test management tool that best practice processes configured solution includes into project status automatically identifies tasks helps in managing all phases leading best practices ready to be executed of the application lifecycle • Best practices for key • Built on S/4HANA including • Simplifies program • Automatically identifies tasks • Enables the creation of graphs processes in 30+ industry leading SAP practices management tasks by providing ‘Ready’ to be executed and reports segments a standardized approach • Deloitte’s industry-leading • Automatic Notification of Task • Defines releases and cycles for • The level of detail necessary practices and solutions • Flexibility and control for Readiness for Team Members the application management for process modeling design managing your SAP S/4HANA process • Demonstrates art of the implementation • Cutover Plan Management in MS • Industry-specific process possible with a functioning SAP Project with Built in Sync • Libraries to track changes and flows S/4HANA solution for • Consolidated, secure and reuse entities in a project, or transactional processing and holistic project data • Built in reports and dashboards