Rejection of SAP: how the largest Russian companies are switching to domestic ERP

Gazprom changes SAP to 1C

One of the largest SAP users, Gazprom, as a rule, is not distributed in detail about its import substitution projects. And little was known about the transition of Gazprom from SAP, in particular, until recently. However, at the 1C forum in October 2024, some details about this first publicly appeared in the presentation of 1C founder Boris Nuraliev.

Gazprom's projects based on 1C solutions, in particular, include the development of a target architecture on the 1C: Enterprise platform, a single ERP template IUS P 2.0, IUS BUiRG (accounting and gas settlements), EASUP (personnel management), IUS MTP (material and technical resources), IUS Industrial Safety, IUS Environmental Management, Corporate Nutrition.

From Gazprom's purchases, it follows that for services to create an information and management system for an enterprise using domestic software (IUS P 2.0), in particular, the company previously set a maximum price of almost 1.4 billion rubles.

Magnit moves from SAP back to 1C, although it does not quite suit it

Magnit closed the ERP transformation project based on SAP products, which at the time of launch in 2020 was announced as the largest ERP transformation project in retail. Timofey Gorokhov, head of the architectural headquarters of the Magnit IT directorate, told TAdviser about this in September 2024 . At the same time, the company chose not to disclose the details of the introduction of alternatives to the solutions of the German vendor.

From the vacancies of Magnit, published as of October 2024 and earlier at various recruiting sites, it follows that the company is now extensively implementing and using 1C solutions. So, for example, in one of the current vacancies for October - a leading developer in the department for the development of integration flows "1C"^[1] - the 1C:Enterprise 8.3 platform, an atypical configuration, is included in the technology stack. And among the duties of the desired employee is the creation of design solutions and development in an atypical configuration.

Among the solutions mentioned in other vacancies are "1C: Accounting," "1C: ERP," "1C: Document Flow." Also, Magnit is developing information systems for calculating wages on the basis of 1C using the 1C: Payroll and HR Management solution. One of the vacancies in the corresponding team, consisting of about 80 people, states that "1S:ZUP KORP 3.1" is the largest installation, deployed by more than 300 thousand employees. The team is engaged in expanding the current functionality of the RM, creating end-to-end data transfer processes, and at the same time is not limited to only "1C" - it integrates new technologies and develops its own solutions based on "1C" related to many personnel systems.

Our team is actively in contact with the "1C" itself, providing recommendations that become part of the standard release, - says the vacancy of the developer "1C: Payroll and HR Management"[2].

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"Magnet"

On 1C technologies, it is planned to launch a new project of Magnit stores in a franchise. As part of the project, it is planned to introduce "1C ERP," "1C: UT," "1S:RMK" and other configurations based on "1C." "Our plans to implement the largest 1C installation for 20 thousand retail facilities, and we already have a team working with 1000 facilities in one database," says^[3] in one of^[4].

At the same time, Magnit also develops its own solutions for automating some of the main business processes for which SAP was previously intended. For example, in October, the company reported that it was developing its own demand forecasting and order planning system (F&R, Forecasting & Replenishment)^[5].

In 2022, Magnit was still thinking about correcting the SAP implementation program, while indicating that 1C was not entirely suitable for the scale of their company. Due to the growth in demand from large 1C customers, the performance of its ERP 1C:ERP Enterprise Management has recently been "tightened." In early September 2024 , the company told TAdviser that it had successfully conducted load testing of the 1C:ERP Enterprise Management solution for 12 thousand users simultaneously working in a single base on PostgreSQL the OS. Linux Having coped with such a load, 1C has come close to fulfilling one of the key requirements of the largest customers still working for SAP.

At the same time, large customers can have tens of thousands of simultaneous users, and in addition to the load, there are a number of other factors that affect the import substitution of SAP for "1C" in large organizations. According to Timofey Gorokhov, the main factors are in the zone of non-functional requirements and are associated with the "very outdated platform architecture," namely:

• No multithreading, dynamic scale-out, and dynamic clustering and scrolling;
• Lack of a caching layer between DBMS and business logic to reduce the number of requests to the database, lack of in-memory calculations;
• High processor speed requirements that limit the ability to use high-load computing in the cloud;
• The lack of integration through ETL/ELT class tools caused by the presence of a document-oriented add-in over a relational database in the platform architecture;
• High complexity of administration of uninterrupted operation in highload mode on several servers, low reliability and unpredictability of server behavior;
• Inefficient mechanisms for synchronizing distributed databases, integrating and replicating data;
• Limited analytical capabilities of the platform, lack of built-in BI tools;
• Poor UX/UI out of the box, low user interface friendliness, outdated graphics design, suboptimal interface performance under high loads;
• Focus on small and medium-sized businesses, lack of interest from the vendor in solving problems of large customers.

Recall that by the time Magnit began its digital transformation based on SAP, it had been collaborating with 1C for about 25 years, but with the growth of the company's business, other solutions were needed to automate the main business processes. At the same time, in 2019, Magnit entered into a strategic cooperation agreement with 1C.

Rosseti creates a system for recording the state of 10 thousand fuel and energy complex facilities on the basis of 1C

As TAdviser discovered, Rosseti decided to create an automated information system for recording the state of the company's fuel and energy complex facilities. In September 2024, it announced a corresponding purchase with a maximum contract price of 96 million rubles^[6]

This purchase is carried out to ensure the safety of power grid facilities, - said TAdviser in Rosseti. - The system will be developed, implemented and supported exclusively by Russian companies using domestic software and equipment.

The software and hardware complex, which will be created, is designed to automate the activities of employees of the security unit of the executive apparatus, branches and subsidiaries of Rosseti, who organize and monitor the implementation of requirements for ensuring comprehensive security and eliminating incidents at the facilities of the Rosseti fuel and energy complex, is indicated in the terms of reference for the competition published on the Procurement portal of the EIS.

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"Rosseti"

It also provides data that Rosseti, one of the world's largest power grid holdings, includes 43 subsidiaries and affiliates, including 16 distribution grid companies. And the Rosseti security unit is responsible for organizing and ensuring physical security of about 10 thousand fuel and energy complex facilities, developing and implementing systems and technologies to protect facilities from illegal entry, threats and impacts.

According to Rosseti standards published in the public domain, the company's fuel and energy complex facilities include various types of power plants, substations, heat and power plants, backup power supplies, diesel generator plants, network management centers, dispatch centers, etc.

Within the framework of the software and hardware complex implementation, the following processes should be automated:

• Accounting and updating of passports of fuel and energy complex facilities;
• Accounting and control of elimination of comments from regulators regarding fuel and energy facilities;
• Interaction with branches and subsidiaries in terms of monitoring the state of fuel and energy facilities and elimination of comments;
• Collection of operational information on acts of illegal interference;
• Secure interaction in terms of meeting the requirements for ensuring the integrated safety of fuel and energy facilities;
• Operational support from the emergency and recovery repair (transfer switch) security services.

It is assumed that the hardware and software complex will be implemented on the basis of the software product "1C: Production safety. Industrial Safety "with maximum use of typical functionality.

The boundaries of the project include 4 subsystems: accounting for fuel and energy complex facilities, incident control, system technical infrastructure, ensuring the security of confidential information, as well as the development/refinement of a mobile solution and integration with 1C: Bus.

The mobile application of the employee of the security unit branch/subsidiary should provide a variety of functions. Among them: the ability to log into the system from mobile devices by participants of operational groups responsible for collecting information about the incident; creating an incident card containing the necessary list of data about it, and editing it; downloading media files of recording (photo, video) of incident data; indication of the responsible person at the scene of the incident, including his contact details; incident status management, etc.

The mobile application for the task force should be implemented for the Android platform, follows from the terms of reference. It will have access to the hardware and software complex from the Internet over a secure channel (VPN, mTLS).

Moreover, the requirements stipulate that the mobile application of an employee of the task force should be installed on personal Android devices.

Commissioning of the system is scheduled for the second quarter of 2025. And they plan to sum up the results of the competition for the choice of the Rosseti performer in mid-October 2024.

RusHydro changes SAP to 1C

On September 10, 2024, the company RusHydro"" announced TAdviser the implementation of the to import substitution system project. SAP The project has been implemented since February 2024 together with the Holding. " T1 Work is underway on the development of the accounting system platform "."1C

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"RusHydro"

"The transition to the domestic 1C platform was an important step for us in the implementation of the digital transformation strategy. The project is designed to ensure technological independence from foreign suppliers, increase the level of information security and create a single integrated management system. In the future, we plan to use the experience gained together with Nota to implement new joint projects, "said Alexander Charikov, Deputy General Director of RusHydro.

According to RusHydro representatives, import substitution of a foreign ERP system for a large energy company is a difficult and large-scale task that requires an in-depth analysis of existing business processes and the development of an effective information architecture.

Within the framework of the project, T1 specialists need to create a unified information environment that can integrate key functional blocks to optimize resource management, increase transparency of financial transactions and improve decision-making. The terms of cooperation also provide for the integration of the created platform with the Tax-3 AIS.

Among the main functional units of the system: reporting under RAS and IFRS, tax accounting, tax monitoring, transfer pricing, budgeting, analytical reporting, etc.

The successful implementation of the project will allow RusHydro to maintain and improve management efficiency, control over financial flows, as well as ensure compliance with modern accounting requirements. As conceived by the company, a systematic approach will ensure the integrity and interaction of all elements, creating a solid foundation for the further development of RusHydro in a rapidly changing market.

As Kirill Bulgakov, Managing Director of Nota, Deputy General Director of T1 Holding, clarified, the project implies a comprehensive modernization of the company's financial management, taking into account industry specifics and new rules for business interaction with the state.

In the future, partners plan to expand interaction. In particular, RusHydro and the vendor of the domestic software Nota (Holding T1) entered into a cooperation agreement. The partners plan to implement a number of projects in the field of import substitution of information technologies in order to improve the reliability of the digital infrastructure of the energy company.

As part of the RusHydro Group's digital transformation strategy for 2022-2024. with the prospect of 2030, a number of projects are envisaged to improve the efficiency of core activities while maintaining the reliability and safety of energy facilities. The program focuses on import substitution, in particular the use of Russian software and the use of artificial intelligence technologies.

Petersburg Metro removes SAP software and switches to Galaktika ERP

On August 6, 2024, Petersburg Metro"" announced a tender for the implementation of a corporate information management system (KISU) based on domestic. software We are talking about import substitution, software SAP instead of which the platform "" will be used.Galaktika ERP

2.38 billion rubles are allocated for the implementation of the project. The terms of reference say that KISU should be built on the basis of a set of software solutions for a single platform of Galaxy products, which are adapted to the specifics of the business processes of the St. Petersburg Metro, as well as the existing local information systems of the customer, integrated with the main platform. In particular, it is planned to deploy the products "Galaktika ERP.CORP RP," "Galaktika EAM.WEB EB" and "Galaxy AMM.WEB."

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Freepik

MMD is implemented as a set of modules - these are specialized configurations with their own databases, logically connected and integrated with each other. Each module must operate according to the principle of a three-link architecture: workplace - application server - database server. Automatic monitoring and diagnostics of malfunctions of all structural components of MMD shall be provided. The main goals of the project are:

• Creating conditions for further effective automation and digital transformation of the enterprise's business processes, including using promising end-to-end digital technologies (big data, artificial intelligence, new production technologies, industrial Internet of Things and others);
• Providing managers of various levels with complete, up-to-date, visual information on the effectiveness of business processes to develop optimal and effective management decisions;
• Ensuring compliance of the created ISU with the requirements of the legislation of the Russian Federation.^[7]

Rosseti decided to accelerate the abandonment of SAP and attracted 1C to import substitution

On June 6, 2024, Rosseti entered into an agreement with 1C aimed at developing partnerships to create effective management systems using domestic solutions. The companies intend to work together to develop a targeted IT architecture of 1C solutions applicable to power grid companies, as well as performance and compatibility testing, maintenance and quality control when creating information systems.

The use of Russian software is especially important for such a strategically important industry as the electric power industry. The implementation of the planned measures will lead to the unification of the landscape of operated IT systems and will allow creating corporate templates that will speed up the transition to domestic software, "said Konstantin Kravchenko.

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"Rosseti"

To implement the agreements reached with 1C, a competence center is being developed on the basis of Rosseti Digital, the IT integrator of Rosseti. According to the HH recruiting portal, as of June, this company is actively recruiting 1C specialists. Among the open vacancies are 1C developers, 1C technical architect, 1C maintenance project managers, etc.

Rosseti notes that they already have experience in successfully solving import substitution problems with 1C. As an example, the holding cites the launch in the fall of 2023 of a software complex for automating business processes for human resources management in a network complex. It is certified "1C," included in the register of domestic software and is designed to automate the business processes of the personnel and settlement circuit on the scale of the entire Rosseti group. Earlier, in 2022, Rosseti Tsifa received the status of 1C: Competence Center for Personnel Management.

The holding could not answer TAdviser's questions about the timing of the transition to 1C and other details of the refusal of the German vendor's software.

Back in 2022, Rosseti said that they were working on the issue of abandoning SAP in subsidiaries, and that the holding had many companies using its solutions, including the largest, FGC UES (since 2023, the Federal Grid Company - Rosseti).

Since that time, a number of projects have been initiated in the holding to transfer certain business processes from SAP to 1C. So, for example, in April 2024, Rosseti Moscow Region (formerly MOESK) decided to transfer accounting and tax accounting with SAP to a domestic decision, announcing the corresponding purchase with an initial price of about 400 million rubles. In August 2023, Rosseti also began to import replace the production asset management system based on SAP solutions.

The provision of services for the implementation of "1C:ERP" is in the procurement plan for November 2024 from the company "Rosseti Mobile Gas Turbine Electric Stations" ^[8]].

SAP in a number of companies that are now part of Rosseti has been implemented since the 90s, covering more and more business processes. So, for example, IDGC of Center (now Rosseti Center) back in 1998 opted for SAP^[9] products^[10]. Cooperation with the German vendor continued to expand until recent years. For example, in 2017, SAP and Tyumenenergo, part of Rosseti, signed a memorandum from the opening of an innovation center for energy in Surgut .

Russian industrialists look towards "Galaxy"

Russian industrial enterprises plan to consolidate efforts to develop ERP based on the solutions of the Galactica Corporation. Representatives of the country's largest industrial holdings agreed on this on May 22 at a closed meeting of the working group on the development of digital technologies for the industry of the Russian Federation, which was held as part of a TsIPR-2024 in Nizhny Novgorod.

It was discussed, among other things, the possibility of launching five pilot projects at enterprises by the end of 2025. According to their results, it will be possible to make decisions on the transition to new systems.

One of the companies that entered into an exclusive agreement with the Galaxy is UltimaTech. The company did this, as they are confident that it is "blasphemy" to develop the existing functionality again, especially for such conservative systems as ERP, in the face of a severe shortage of IT personnel.

I remember very well the 2010s, when metallurgists, miners and chemists actively switched to SAP, where I worked then, from disparate applications. We were in the thick of it. And now we know what to do. At CIPR, we held the first meeting of the working group on replacing SAP/Oracle with domestic products. It includes companies that want not only to switch to the Russian "Galaktika ERP," but are thinking about how to do this with business benefits and with a positive economic effect, "said Pavel Rastopshin, CEO of UltimaTek.

The Galaxy believes that now the time has come for cooperation and the use of all the expertise available to the company and 30 years of experience in working with Russian enterprises.

To improve our decisions and make them meet all the needs of heavy industry is the main goal of our joint work, "said Anton Malkov, Chairman of the Board of Directors of Galactica.

Rosseti Moscow Region returns accounting to 1C after 12 years of using SAP. Project price - about 400 million rubles

As TAdviser found out, Rosseti Moscow Region (formerly MOESK) decided to transfer accounting and tax accounting from SAP to a domestic solution. The company announced a tender to determine the contractor for these works with an initial price of about 400 million rubles in April 2024^[11]

Currently, automated management of accounting and tax accounting and reporting is carried out on the basis of the SAP ERP software product, according to the published terms of reference for the competition. It is necessary to organize automated control of these processes based on the software product included in the register of domestic software.

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Official website of the Mayor of Moscow

It follows from the technical assignment that 1C is seen as a new platform for themselves in Rosseti Moscow Region. The project requires a contractor who has specialists in the team who have been trained in the direction of "1C: Specialist. Accounting Department 8, "" 1C: Specialist "for the development and modification of applied solutions for" 1C:Enterprise 8.3, "as well as a certified project manager for" 1C. "

Among the transition from SAP to a domestic solution, there is also an exception to the risks of sanctions pressure, savings on the acquisition of licenses, a decrease in operating costs for system support, etc.

Migration of accounting for the new solution will cover the executive apparatus of Rosseti Moscow Region and its branches: Moscow Cable Networks, Moscow High-Voltage Networks, Southern Electric Networks, Western Electric Networks, Northern Electric Networks, Eastern Electric Networks, New Moscow, "" Energy Accounting. "

The total deadline for the work is 24 months from the date of signing the contract with the contractor.

Rosseti Moscow Region, we recall, is one of the largest distribution power grid companies in Russia. Its main activities are the provision of services for the transfer of electric energy and the technological connection of consumers to power grids in Moscow and the Moscow region. The company also provides additional services for technological connection and others.

While still MOESK, in 2011 the company announced an ongoing project for the integrated implementation of SAP, designed for three years. First of all, then it was planned to transfer the entire accounting department from the 1C platform to SAP. The mass commissioning of SAP was planned for January 2012^[12].

The transfer of accounting and tax accounting back to 1C is not the only project of Rosseti Moscow Region on migration from the solutions of the German vendor. So, for example, in April 2024, following the results of the competition, the company entered into a state contract with a volume of about 371 million rubles for the creation of an automated control system for the provision of technological connection services on a domestic platform. SAP is now also used for this.

In addition, in April, Rosseti Moscow Region published the purchase of work on the creation of an automated system for managing corporate finance and contracts on a domestic platform with an initial price of about 136 million rubles. This process is now also carried out in SAP.

VK plans to transfer accounting and treasury from import solutions to 1C. Project budget - 1 billion rubles

As TAdviser found out in February 2024, VK has planned a major project to switch to 1C products. The company published the selection of proposals for the right to conclude an agreement for services for the implementation of automated accounting systems, treasury, management of NSI on the basis of "1C" with an initial price of more than 1 billion rubles^[13].

The project is being implemented within the framework of the import substitution program and involves a phased transition from foreign systems and software to domestic counterparts. At this stage, we are choosing a supplier (integrator) to implement the selected solutions, - said TAdviser in VK.

The company has not yet disclosed the technical details of the project. The terms of reference for the purchase of services are published only for participants who signed the terms of confidentiality with an electronic signature.

In February, VK also opened the vacancy of the Project Manager for Accounting Automation 1C^[14]. Its description says that the new employee will have to manage the project for the development and implementation of an automated accounting information system on the 1C: Holding Management platform as part of the project program for transforming the processes of the financial function (accounting, treasury, budgeting, document management, NSI management).

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TAdviser

From the description of other vacancies, including those already closed, it follows that VK uses solutions based on SAP ERP for financial processes, in particular. Also in VK, for example, SAP HCM is used to manage personnel processes.

I must say that earlier Mail.ru Group widely used 1C solutions, but in 2010-2012. the company headed for the implementation of SAP, and at that time the products of the German vendor were chosen "as the least evil."

Author: Natalia Lavrentieva

Notes