Electropult plant (Galaktika ERP)

Information on the customer

Prerequisites of the Project

At the end of 2003 the new management of JSC Electropult Plant developed the program of development of the enterprise directed to gaining the leading positions in the energy market of Russia. According to the adopted plan, production volume and implementations had to increase from 400 million rubles in 2003 to 1.5 billion rubles in 2005.

For achievement of an effective objective it was necessary to solve the following problems:

• change a management structure the plant;
• develop new policy of sales and sales pattern;
• upgrade the equipment;
• implement modern information technologies for management of the main business processes of the enterprise.

Implementation of a modern ERP system became one of the main stages of the program of increase in efficiency of activity of the plant.

ERP system choice

"At a stage of the choice of a software package we considered as Russian (""Galaktika ERP"", Parus), and the large western  systems are BAAN (Infor ERP LN), SAP ERP — the president of ROSELECTROPROM HOLDING Gennady Lokotkov noted. — After the analysis of opportunities of these solutions it became obvious that only ""Galaktika ERP"" meets all our requirements: has broad functionality, it is easily configured under specifics of the plant, does not require "withdrawal pains" of the existing business processes. Besides, it is significantly cheaper than the western analogs".

Thus, the ERP system was selected on compliance to the functional requirements imposed by the plant, requirements to flexibility and opportunities of adaptation to the existing conditions of production and also for price criterion.

Project Progress

At the beginning of 2004 "Galaktika ERP" at the enterprise started system implementation the project team consisting of specialists of Northwest department of Galaktika corporation, different services of the enterprise (economical and design departments, accounting, purchasing departments and sales) and the EP-Audit company formed based on IT department of the plant. 

At the first stage of the project of control automation the organization structure of the enterprise and Business Process Management Suite were created and formalized. Were automated by means of the Galaktika ERP system: financial accounting, personnel management, contract management and logistics, payroll, inventory management and production logistics. Factory accounting closed the first quarter 2004 already in a new system. At the same stage there was "Galaktika ERP" was integrated with OrCAD CAD.

Within the second stage based on "Galaktika ERP" at the enterprise the budgeting system was built. The project team prepared the scheme of the movement of financial information, the centers of the financial responsibility are defined and regulations of input and information processing are developed. The rights and obligations of divisions on management of the income and expenses were recorded in regulations on the centers of the financial responsibility and in regulations on budgeting. Also automatic collecting of actual data about budget implementation from records of accounting was organized.

In parallel specialists of EP-Audit company were engaged in production management business process automation. Use "Galaktika ERP" allowed to implement planning and control of finished product output, operational obtaining information on an order status, calculation of need for material, labor, production resources and also to carry out calculation of the production program.

Based on "Galaktika ERP" also the system of controlling solving problems of planning and the actual collecting of costs to order, the analysis of economic evaluation of performance excellence of the production program was constructed. On the basis of production specifications of a product, overhead data calculation of actual costs on production of products for the period was implemented. Thus, the management had an opportunity to keep track of profitability of production and to receive exact answers to questions of compliance to the planned and actual profit, about compliance of the amount of salary to the amount of profit, and on the basis of data retrieveds to make the operational decisions concerning business process optimization or number of staff.

Also during implementation of the second stage of the project at the enterprise  the management system for orders was implemented (with emphasis on sales management). Now the sales department makes out in a system the request which comprises all information on the order and is the basis for inclusion of the order in the production plan. Requests allow to execute preliminary calculation of cost of products. And, knowing structure of a product (specification), raw material prices, cost of normo-hour, a share of overheads, within several minutes it is possible to make the commercial offer for the customer.

Also the Galaktika ERP system was integrated with the Windchill PDM system and the design E-plan system. Thus, it was succeeded to organize uniform data array from a PDM system to the modules ERP systems and also to avoid double entry of information. 

The project was complete by December, 2004.

Project Results

Now at the enterprise the Galaktika ERP system is completely put into commercial operation (160 jobs), the possibility of obtaining information in real time is provided, fundamental standards and algorithms of business processes are created, optimized an organization and functional structure of the enterprise. Warehouse stocks were reduced by 40% – the plant got rid of all "illiquid asset".

The problem of production at the planned cost value is successfully solved in time. Thanks to a system, the management of the enterprise had an opportunity to compare planned and actual cost, to control accomplishment of regulations of profitability. 

Project Features

Acceptance by the management of JSC Electropult Plant the decision on diversification of business of the company and restructuring became the most important feature of the project. This decision was made after end of the first stage of project implementation and had a direct impact on the subsequent its stages. Creation of Roselectroprom holding which included Electropult and two other enterprises in Nizhny Novgorod and Yekaterinburg became result of the announced restructuring. At the same time and from the structure of Electropult several subsidiary companies, in particular "Electropult Metal" and "Electropult the Set" were selected. Besides, within holding the EDS Audit company to which IT specialists of Electropult were transferred, oriented on execution of works on automation of the enterprises of Roselectroprom was created.

Nevertheless, the project was continued and successfully complete, and on its complete implementation less than a year was required