KT Corp: Driving Innovation in Business Processes by Running the SAP ERP Application in the Cloud

Transcription

1 2013 SAP AG. All rights reserved. KT Corp: Driving Innovation in Business Processes by Running the SAP ERP Application in the Cloud After a significant merger, KT Corp, Korea s largest telecom company, selected the SAP ERP application to integrate its many disparate work processes. The company s internal IT team opted to run the new application on a cloud-based server, a pioneering experiment that yielded great success. KT Corp now has innovative business systems capable of handling today s work process requirements and that will continue to do so well into the future.

2 Company KT Corp Headquarters Seongnam City, South Korea Industry Telecommunications Products and Services Land and wireless communication services Employees 32,000 Revenue trillion won (US$18.97 billion) (2011) Web Site Partners Accenture KT DS Business Transformation The company s top objectives Simplify, standardize, and systemize work processes across the enterprise Create a global system for supply demand and inventory management Enable information innovation for quick and consistent business decisions The resolution Integrated disparate IT systems with the SAP ERP application Leveraged an internal cloud platform and in-house technical expertise to significantly reduce implementation costs Created innovation synergies between KT Corp systems and SAP ERP, shortening setup and stabilization time The key benefits Enables strict cost accounting and profitability analysis through more precise asset management Increases confidence in business information and process efficiency Provides momentum to expand into the market of cloud-based enterprise resource planning (ERP) implementations Read more SAP ERP was the right choice for integrating disparate ERP systems at KT. The previous ERP systems were run separately. Instead of restructuring the previous ERP system, KT set up the world s first cloud-based proprietary ERP system for a large telecommunications company. Lee Jae, Head of Business Information Transformation, KT Corp Top Benefits Achieved 237% Improvement in the ability to subdivide asset management for more detailed analysis 22% Increase in process efficiency 68% Savings on hardware setup costs See more metrics 2 / 6

3 SAP Business Transformation Study Industry KT Corp Innovating to maintain sustainable growth KT Corp is a world-class telecommunications service company operating out of South Korea. Since its start as a state-run telecommunications operator for landlines, KT Corp has experienced explosive growth in user numbers, offering new services for mobile and wireless devices like smartphones. Rapid expansion necessitated the transformation of business organizations across the company, but legacy systems, including the old enterprise resource planning (ERP) systems, were difficult to update and integrate with new service models. The previous ERP system at KT Corp was only used for accounting and finance. All the other tasks, including personnel, purchasing, asset management, inventory, and strategy for enterprise-wide management, were run using separate systems. It took so much time and effort to compile data and run reports, strategic decisions and action items were often delayed. To meet the challenge, KT Corp needed an innovative plan. The company launched its business and information system transformation (BIT) project with the goal of integrating disparate ERP systems into one and establishing new, more efficient business processes instead of simply modifying existing ones. The company employed globally tested tools and industry best practices to minimize development time and costs through improved efficiencies and a strict system of governance. The goal was to establish a best-in-class organizational structure worthy of a world-leading telecommunications company and use the experience to expand KT Corp s business model in the future. 3 / 6

4 Pioneering with an ERP system implementation on a cloud-based server KT Corp was running a number of separate ERP systems for different tasks as was KTF, with which they would eventually merge. Neither company was prepared for the challenge posed by combining business processes using disparate IT systems. Rather than attempt to update and merge existing systems, KT Corp ultimately turned to the SAP ERP application and moved for a speedy implementation. Instead of adopting a UNIX server, the standard choice for most large corporations, KT Corp opted to run the application on a cloud-based server developed by its own internal IT experts. This was a pioneering experiment in the use of cloud servers and allowed KT Corp to secure high performance and reliability from its new system. Initially, external consultants were skeptical about the experiment of building an ERP system with a cloud-based infrastructure, which was the first of its kind in the world. But KT Corp quickly proved the endeavor a success, going live after just 14 months. Not only was the implementation a learning experience that could be leveraged for future projects, but it also ended up providing significant cost savings. The use of the cloud server was a success and promises to benefit KT Corp by helping to ensure even more reliable services for its customers. 4 / 6

5 Improving process efficiency by 22% With a single, integrated ERP system, data processing is precise, reliable, and efficient. Tasks and roles are standardized for every staff member and every project across the enterprise. The application can accurately monitor who has performed a task under a given service or business model. The profitability of even the lowest level model can be analyzed, enabling quick decisions and more productive management. The expertise the IT team at KT Corp gained through the establishment of the cloud-based server was so significant that the company was awarded certifications from SAP for hosting and cloud services, which are valuable assets for future business endeavors. In fact, KT Networks, a subsidiary of KT Corp, completed an upgrade of the cloud-based ERP project with support from SAP. And KT Corp plans to sign strategic partnership deals with other major domestic and international consulting firms to help clients implement the SAP ERP application using cloud-based servers. Key benefits 237% Improvement in the ability to subdivide asset management for more detailed analysis 68% Savings on hardware setup costs 22% Increase in process efficiency 90% Reduction in the number of ERP systems 214% Improvement in the ability to subdivide profitability analyses by operational area 5 / 6

6 KT Corp Planning to streamline billing and data management With the recent receipt of certifications for hosting and cloud services, KT Corp is ready to expand into a partnership with SAP and domestic and international consulting firms as a provider of cloud-based servers on which corporate consultants can run the SAP ERP application. Following completion of a business support system and the implementation of the SAP NetWeaver Business Warehouse application, KT Corp will focus on fine-tuning its IT landscape overall, increasing its reliability and operational excellence. CMP24612 (13/04) 6 / 6

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