See how this diversified energy company used SAP Best Practices and the SAP for Utilities solution set of software and services to automate processes, eliminate inefficiencies, and reduce costs.
ENERGEN
SAP BUSINESS TRANSFORMATION STUDY
AT A GLANCE Energen Corporation is a diversified energy holding company Industry Utilities, oil and gas with headquarters in Birmingham, Alabama. Its two lines of Revenue US$1,394 million business are 1) the acquisition and development of domestic, Employees 1,500 onshore natural gas, oil, and natural gas liquids reserves; Location Birmingham, Alabama and 2) natural gas distribution in central and north Alabama. Web Site www.energen.com Energen Resources Corporation has proved reserves of 1.7 SAP® Solution and SAP® R/3® (functionality trillion cubic feet. Alagasco provides clean-burning, energy-Services now available in SAP ERP) efficient natural gas to approximately 450,000 Alabama homes, Implementation Partner PricewaterhouseCoopers businesses, and industries.
Key Challenges Why SAP Was Selected„ Handwritten work orders and manual scheduling „ Industry-specific functionality„ Manual project approval and review process „ Professional sales process„ Cumbersome inventory management „ Positive analyst recommendations„ Manual bid process „ Ease of integration„ Significant effort in processing POs„ Labor-intensive data retrieval, dependent on IT
Implementation Best Practices Low Total Cost of Ownership„ Committed executive management support „ 9-month implementation„ Business-led and -driven implementation team „ On-time, on-budget implementation„ Process experience of Energen project team „ 30-45 days of initial training„ Effective project management office„ Use of SAP® best practices„ Strong implementation partner
Financial and Strategic Benefits Operational Benefits„ Fully integrated system „ Time required for project approval reduced from 2-4 weeks „ Real-time visibility to accurate cost information to a few hours„ „Automated approval of purchase requisitions Storeroom costs reduced by 50% for 2 locations„ „Streamlined payment process for vendors Significant reduction in communication with vendors on PO status„ Automated scheduling of routine maintenance functions „ Improvement in PO efficiency by 50%-70%„ Enhanced project tracking „ Estimated 10%-20% improvement in certain spend areas„ Improved buyer and spend analysis„ Automated contracts
0066__1188995555__EEnneerrggeenn__PPMM__BBTTSS__SShhoorrtt..iinn11 11 33//2277//22000077 11::2200::0044 PPMMwww.sap.com/contactsap
"With SAP software, we are able to get project "After the SAP implementation, we are doing much approvals within a few hours. Earlier, at each approval more in purchasing with less. We did not need to hire step, employees would need to review paper maps and more people as our business has grown." typewritten forms." Regina Hinton, Supervisor, Purchasing, AlagascoJoe Wheeler, Vice President, Operations, Alagasco
Making Technology a Differentiator Training on the plant maintenance and project systems Energen wrestles with the volatility of energy prices and functionality presented a key challenge. Some users in the field their effect on operations on a daily basis. The company's were unfamiliar with PC use, and entering significant amounts of key challenges included reducing operating costs, improving data was a major change in the way they had done their jobs for business process efficiency, and maximizing shareholder many years. value. Traditionally, all tasks related to plant maintenance and project systems were handled manually. Employees Change for the Bettergenerated handwritten orders. The review process was manual Energen realized immediate benefits in the plant maintenance, and involved paper records. Getting project approvals was project systems, and supply chain management areas, where an involved task requiring 6 to 12 steps and review of paper the shift to automated processes resulted in significant efficiency maps and typewritten forms at each step. Manual purchasing improvements. For example, project approvals come through operations were equally cumbersome and afforded limited within a few hours and approvers can go over the project outline visibility into spending patterns or support for vendor analysis. rather than deal with paper maps and forms. The integrated Energen undertook a comprehensive proposal review process software provides real-time cost visibility for projects, thereby involving SAP, Oracle, PeopleSoft, and J.D. Edwards and found enabling better-informed decision making. Scheduling ... [download for more]
