IOCL

Introductions
Brow Frowed and J.K Puri {the executive director of

optimizations} sat back in his New Delhi office to take
stock of the complexity of the issues he faced.
That is….
• Deregulated oil and gas sector in INDIA.
• Unfamiliar with competitive environment.
• Not used IT in proper way.
Introduction contd……
Implement Project MANTHAN.

It had been planned in two phases
• The first involving 99 sites.
• The second in over 500 sites.
Problems in Project MANTHAN

Public sector undertaking & DEREGULATION :
After independence in 1947…

the 1950s & 1960s saw the emergence in India of
several public sector undertakings & govt. control in
core industry sector…..
from micro electronics to aircraft manufacture.
Problems in PSUs…..
In 1992, the Indian govt.-as part of a decisive move to
stimulate the economy of INDIA…
Oil industry deregulation :
Since 1976, the oil industry had operated under the

government-controlled administered price
mechanism {APM} for petroleum products.
A strategic planning group set by the Indian govt..
with the commission of the Jamnagar refinery by
Reliance Industries in the late 1990s.
Indian oil corporation ltd….
Indian Oil Company Ltd. merged with Indian

Refineries Ltd to from Indian Oil Corporation Ltd.
(IOCL).
In fiscal year 2002, it was ranked 191.
Ranked 500 in Fortune Global.
IOCL had a divisional structure based on business
lines that reflected the individual companies
before merger.
Information technology at IOCL:
• EDP was introduced in 1966.

• In 1986 Personal computers (PCs) was introduced.
• The first online transaction processing program was
implemented in 1989.
• TDM for marketing department.
• FMS for finance department.
• MMS for material management system.
• OMNIS for online maintenance & inspection
system.
Problems in it system:
• Technology gap.
• Y2K .
PROJECT MANTHAN
Project Manthan was an opportunity to ‘integrate ’ the

company using an IT-enabled system.
To initiate the process of IT-based re-engineering,

workshops were conducted by the functional expertise
resource group with about 300 representatives from
different areas of the IOCL business.
SCOPES
• To develop a corporate IT strategy, taking the available technology and capability
into account.
• To define the “deliverables” from the corporate integrated information system,
considering the “best practices” followed worldwide, especially in the petroleum
industry.
• To determine the needs for upgrade and addition of hardware and software.
• To examine the availability of in-house skills as well as the current systems set-up
and to recommend the structure and the skills required for operating,
maintaining, and upgrading the proposed corporate system.
• To design the system with open architecture so that the continuing
advancements in technology for hardware, software, and communications can be
seamlessly assimilated without disrupting the totality of the process.
• To carry out trial implementation, de-bugging, and stabilization of the system .
• To continue the association for the purposes of post-implementation system and

process maintenance, upgrades, and modification, training, education, and
support in general, including continuous updating of the “best practices”
database.
OBJECTIVES
• Seamless integration of business processes and information flow
• Centralized control with decentralized customer response
• Standard, accurate, real time data to support decision-making
• Extensive ‘drill-down’ reporting capabilities for analysis of trends
• High degree of reliability and security
• Communication connectivity across the Corporation

In April 1997, Price Waterhouse Associates (now PwC) was
assigned the task of conceptualizing, designing and
implementing an integrated information processing system
across IOCL..
In July 1998, PWC submitted the conceptual technology plan.

• In October 1999, IOCL selected the internationally-reputed
ERP package, SAP R/3. The system would be accessed
company-wide over a hybrid wide area network.
• The project was to be completed in four stages:

• (1) conceptual design,
• (2) detailed design,
• (3) construction, and
• (4) implementation.
• One of the biggest challenges to adopting the new IT system
was the level of computer proficiency in the organization.
• Nearly 9,500 employees in executive and supervisory roles, a

large proportion had little experience with computers.
• Apart from launching IT-based training, in 1999-2000, IOCL

provided personal computers for home use to all 9,500
executives and supervisors as a means to enhance overall
computer literacy and skills
Going live…….
R&D become first to go-live site on 31 August 2001

22 pilot site were to go-live on 1 September 2001
Core team favored the R&D as it offer advantage
1. Transaction opportunities for most SAP modules
2. Proximity to head office & project Manthan team
 Gurgaon, become second to go live on SAP
R/3software on 31October 2001
Cont…..
 A dozen locations were short-listed
1. Panipat
2. Faliure of communication link: VSAT
3. Go back to leagacy system and roll back SAP
implementation
 The data generated at the central site from all
location of IOCL will be backbone for
customized portal
The Response Time Issue
 V.N.K Reddy, manager of basis team pointed

out:-
1. Designed response time-2000ms
2. During the first weeks of March & April system slow down
 P.S.Negi pointed out:-
1. The bijwasan terminal is life line for Delhi
2. During the first weeks of March & April system slow down
Problems
• Response time
• Hardware configuration and installation
• Database design and installation
• Nature of the processes as well as their loads
• Communication bandwidth limitation
Alternative
• Schedule all reporting and batch jobs after

hours when the transaction load was light but
was unsure how end-user would responds to
this deferral
• To remove reporting load from the database
server and shift to a business warehouse
server
The Future Course…..
 Puri replaced the decentralized system by the

centralized SAP R/3 system.
 Puri was confident that IS personnel from the

various locations could be retrained in the
new technology so that IOCL would have the
capabilities to roll the system out to the
remaining sites under Phase II.
 He was also unsure about how IS personnel at the
various divisions would respond to their changing
roles and responsibilities and to new management
expectations.
 Puri realised that poor response time was the

biggest issue.
 Any successful resolution had to address not only

the 66 sites currently on SAP R/3 but also had to
ensure that events such as the ones they had faced
did not occur when the load from the remaining
500+sites was on the new system

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Introductions

Brow Frowed and J.K Puri {the executive director of

Implement Project MANTHAN.

Problems in Project MANTHAN

After independence in 1947…

Since 1976, the oil industry had operated under the

Indian Oil Company Ltd. merged with Indian

• EDP was introduced in 1966.

Project Manthan was an opportunity to ‘integrate ’ the

To initiate the process of IT-based re-engineering,

• To continue the association for the purposes of post-implementation system and

• Seamless integration of business processes and information flow

• Centralized control with decentralized customer response

• Standard, accurate, real time data to support decision-making

• Extensive ‘drill-down’ reporting capabilities for analysis of trends

• High degree of reliability and security

• Communication connectivity across the Corporation

In July 1998, PWC submitted the conceptual technology plan.

• The project was to be completed in four stages:

• Nearly 9,500 employees in executive and supervisory roles, a

• Apart from launching IT-based training, in 1999-2000, IOCL

R&D become first to go-live site on 31 August 2001

 V.N.K Reddy, manager of basis team pointed

• Schedule all reporting and batch jobs after

 Puri replaced the decentralized system by the

 Puri was confident that IS personnel from the

 Puri realised that poor response time was the

 Any successful resolution had to address not only

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