Microsoft Dynamics Customer Solution Case Study
Leading Kuwaiti Manufacturer Increases Operational Efficiencies with Microsoft Dynamics in Early Stages of Solution Rollout
"Even in the early development phase, ACICO has achieved a significant increase in operational efficiencies. Both INC Technologies and Microsoft took the time to understand our business and put together a great solution for us."
Hussam Abu Loghod, Group CFO, ACICO
Aerated Concrete Industries Company (ACICO) is a leading construction, building and concrete manufacturing company with operations throughout the Gulf Co-operative Council (GCC) region. ACICO was established in June 1990 as a Kuwait Shareholding Closed Company under license from Hebel International, Germany. Its various manufacturing plants are located in the State of Kuwait, UAE, Qatar and Saudi Arabia. The organization's operations is split across six vertical companies that cater to different segments. These include ACICO Industrial; ACICO Real Estate; ACICO Hotels; ACICO Construction; ACICO Cement and GAK ACICO.
As the company grew and diversified its businesses, it became increasingly difficult to manage and streamline the processes of 13 companies. ACICO's legacy technology struggled to support the growing business causing internal departments to become isolated from one another. With management processes lacking efficiency, ACICO realized that it needed to implement a modern business management system that could automate and streamline processes across the organization. The company reviewed a wide range of business management solutions before deciding on Microsoft® Dynamics™ AX. Microsoft Dynamics AX has streamlined and simplified business processes throughout ACICO - from order management and supply chain systems to capacity planning and a virtual work environment. ACICO has benefited from increased productivity, improved efficiencies and higher levels of integration.
With six group companies and 13 subsidiaries, it became increasingly tedious for ACICO to manage and run its businesses on different systems. The company used tree disparate accounting software applications, and as a result, ACICO struggled to keep track of manufacturing costs, accurate customer orders and financial management systems that were unable to handle inter-company transactions; logistics processes and flexible and timely reports. With departments working as separate islands, financial reporting and data sharing across business units became time consuming and the management of ACICO were left without a real-time enterprise view of sales performance and financial reports. "We were suffering from disconnected operations as we did not have integrated solution," said Hussam Abu Loghod, Group CFO, ACICO. "We wanted a system that could handle a fast-growing workload cost-effectively and streamline our business processes."
Clearly, ACICO needed to migrate to a more robust business management solution that would accommodate its distributed operations while providing greater visibility into day to day business. ACICO worked with Microsoft's Gold Certified Business Solutions Partner, INC Technologies to conduct a thorough analysis of its operations and compare a number of business management products. Loghod says: "We had some demanding requirements: extensive integration capabilities; automated order and invoice management and user friendly technology as we did not want a complicated system. From day one, we identified a number of functional and technological benefits associated with Microsoft Dynamics AX. Total cost of ownership was 25-30% lower than competing technologies. Other ERP products like Oracle were going to require a huge investment of our time and money. We needed a tier 1 business solution to be implemented in months rather than years."
Prior to the deployment, Microsoft conducted five months of extensive research and pre-sales requirements by meeting key users and putting together proof of concept designs for different schemes and business groups within ACICO. Project managers also visited ACICO's manufacturing plants in Dubai and Kuwait and invested enough time to the analysis of the business and technology requirements. INC Technologies was also able to provide ACICO with a full array of hardware and software requirements making it easier for the organization to work with just one partner. Based on Microsoft's value add, commitment to the project and cost-effective ERP offerings, ACICO deployed Microsoft Dynamics AX in January 2008. Microsoft Dynamics AX also supports multiple languages and multiple currencies which was a plus point for ACICO who does its business across various geographies.
To help speed up the implementation process internally, and ensure a quick user adaptation the management of ACICO announced a financial award to the first company that completes the deployment. Coupled with Microsoft's implementation methodology that capitalizes on best practices such as scheduling and management control, 9 companies are already live and 20 companies are expected to go live by the end of August 2008.
In its first phase, Microsoft Dynamics AX has been able to deliver streamlined processes in finance and logistics to boost productivity and tightly integrate business processes. With integrated financial management systems, ACICO is now able to control letter of guarantee (LG) and letter of credit (LC), which was crucial for ACICO, while empowering users with document management features to enable better accountability of tasks. The enterprise solution features along with the features of Microsoft Active Directory have improved security and privacy and provides greater administrative control over sensitive business data. "Even in the early development phase, the business has achieved a significant increase in operational efficiency. Both INC Technologies and Microsoft took the time to understand our business and put together a great solution for us," remarks Loghod.
Microsoft also removed all third party applications and placed one single centralized management solution that runs on a server in Kuwait. All IT maintenance is now conducted centrally, reducing IT administration costs by 30% percent. The availability of value based add-ons such as Total Quality Control Management (TQCM) and process manufacturing have resulted in improved production reporting, streamlined logistics operations and increased operational efficiency throughout the organization. Samir Akel, Sales and Marketing Director, INC Technologies says, "With Microsoft Dynamics AX, deployment was relatively easy and quickly accomplished. After a short period, users were trained on the new system and implementation followed. If there were problems, we could act quickly. After implementing Dynamics, the different companies of ACICO now have one integrated system. This has given them greater flexibility and adaptability, has cut IT costs and vastly improved inter-company collaboration enabling them to act as one unified entity."
The success of the first implementation phase has paved the way for a host of new benefits.
Integrated Infrastructure Improves Workflow and Supports Informed Business Decisions
Previously, ACICO relied on disparate systems to manage complex information. This business model resulted in different departments and offices having to separately manage processes such as accounting and ordering. Now, users can access consolidated business data and manage processes across the enterprise. Employees have increased control and insight using new functionalities and can now plan and compile sales orders and financial reports more accurately. Due to the availability of information across the organization, managers at ACICO have the visibility and can now rapidly respond to changing market demands. With the aid of real-time information, they can now make confident management decisions, keeping the business operating seamlessly and minimizing the cost of inefficiency.
Scalable System Accommodates and Fuels Business Growth
A scalable infrastructure to support the organization's rapid growth was vital to the business. "ACICO has grown significantly in both employment levels and customers," says Abu Loghod. "We need solutions that don't just grow with us, but one that fuels this growth. Microsoft Dynamics AX can scale to our needs and help us continue to expand in the future. Following the implementation, we have been able to acquire and add three new companies to our business portfolio," he added.
Centralized Operation Saves Time for HR and Employees
The HR department no longer works on a standalone system. INC Technologies has deployed a separate HR application that allows employees to access, share and distribute information. This allows users to update employee information and add performance-based insight to employee records. Employees can also enable a virtual work environment by using the Microsoft SharePoint Enterprise Portal to access their network and applications from outside the office. Loghod says, "Microsoft Dynamics AX gives us a complete and flexible platform for enhancing the management and operation of our business. It is technologically superior to our previous systems and able to deliver a more efficient cost-benefit equation."
About Microsoft Dynamics
Microsoft Dynamics is a line of integrated, adaptable business management solutions that enables you and your people to make business decisions with greater confidence. Microsoft Dynamics works like familiar Microsoft software such as Microsoft Office, which means less of a learning curve for your people, so they can get up and running quickly and focus on what’s most important. And because it is from Microsoft, it easily works with the systems your company already has implemented. By automating and streamlining financial, customer relationship and supply chain processes, Microsoft Dynamics brings together people, processes and technologies, increasing the productivity and effectiveness of your business and helping you drive business success.
For more information about Microsoft Dynamics, go to www.microsoft.com/dynamics
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Country/Region: Kuwait, GCC
Aerated Concrete Industries Company (ACICO) is a leading construction, building and concrete manufacturing company with operations throughout the Gulf Co-operative Council (GCC) region.
ACICO needed a more robust, integrated business management solution that would support the company’s rapid growth; complex internal business processes and distributed operations.
With the help of INC Technologies, ACICO deployed Microsoft Dynamics AX, which streamlined processes, empowered employees with easy-to-use tools and integrated disparate systems.
- Controlled financial management systems
- Improved business processes with automation
- Flexible, easy-to-use technology infrastructure with anytime, anywhere access
Software & Services
Microsoft Dynamics AX; Windows Server 2008; SQL Server 2005; Windows Terminal Server; Exchange 2003; Active Directory and Domain Controller 2003.