Published on 13-Oct-2009
The IBM® Cognos® solution was a flexible tool that could be integrated easily with KJO’s other software, and had the ease of use and local representation the company was looking for.
The need to modernise the financial reporting technology for improved performance.
An IBM Cognos 8 BI system that provides integrated, error-free financial reporting for shareholders and staff throughout the business, with exponential time saving in month-end reporting and business plan creation.
Improved accountability, efficiency and production through implementation of blue-chip practices; effective information sharing; accurate reports; software updates that take place seamlessly.
Al-Khafji Joint Operations (KJO) is a joint venture for oil and gas exploration and production between Aramco Gulf Operations Company (AGOC) and Kuwait Gulf Oil Company (KGOC). As a united oil and gas operation in the Gulf, the organisation needs to perform all activities in a competitive and responsible way.
In order to provide timely and accurate information to its business operations and its shareholders, KJO needed to invest in updating its technology. The functionality and ease of use offered by IBM Cognos software, and strong local representation to ensure smooth implementation, provided KJO with both the technology and support the company was looking for.
KJO needed to identify, implement and use up-to-the minute technology throughout its business to streamline internal processes and drive business efficiency. In addition, the company needed to ensure that the information demands of its shareholders were being met both accurately and quickly.
However, at the time, KJO was under severe pressure due to its existing IT assets. The year prior to the end of concession was one of minimal investment on IT projects and, as a result, the newly formed company needed to take steps to modernise. For example, the company didn’t have email in place until 2004, and the PC network wasn’t completed until early 2005.
“We needed a solution that would give us a single version of the truth in a user-friendly format,” explains Mutlaq Al-Khodhair, Manager of Corporate Planning at KJO. “With so much at stake, we had to ensure we were delivering accurate information to our shareholders. We wanted to introduce a tool that would provide integrated reporting and cut down on the time it took to provide shareholders with information. In some instances this could take up to three months.”
By working closely with its partners, Aramco and KGOC, the company recognised it needed to invest heavily to solve these issues. A key area of focus was within the finance department, as financial reporting involved lengthy and resource-intensive manual processes.
The company also needed to drastically improve how reports were delivered to its shareholders. “This was a technology leap for the business. Previously, we used Microsoft® Excel® spreadsheets. However, with people working in a number of versions of spreadsheets, this resulted in errors,” says Al-Khodhair. “It was tedious to produce plans linking together hundreds of spreadsheets, and missing information could lead to costly mistakes. We needed to introduce performance software that could integrate easily into the business, while also helping us to improve the accuracy of our reporting. This, in turn, would also help us deliver the results quickly to our shareholders.”
The company began the process of reviewing some of the business intelligence offerings on the market, including Hyperion, Business Objects CMCS and IBM Cognos technology. After a lengthy review process and demonstrations of all solutions, KJO selected IBM Cognos 8 BI as the technology that could meet its needs best, because of the core functionality of its BI and planning technology, local representation and ease-of-use.
“The IBM Cognos technology stood out, as we could see immediately how it would meet our needs,” says Al-Khodhair. “It is a flexible tool that can integrate easily with other packages, while any software updates take place seamlessly.”
The project was managed at KJO by the IBM Cognos Middle East strategic partner, Performance Systems. “As we’re situated in a remote location we needed to make sure we had support during the implementation,” says Al-Khodhair. “We forged a close working relationship with Performance Systems early on and this continues today right up to a senior management level.”
Since going live with IBM Cognos 8 BI, KJO has been able to improve the way in which it delivers information required by management and shareholders greatly.
“Through the adoption of the IBM Cognos system, we’ve started to drive change and internal processes have improved dramatically. We are now seeing the standardisation of data throughout the business and our staff is becoming more disciplined about reporting. Throughout the business, we have little pockets of expertise that are now linked together due to the introduction of IBM Cognos technology. That means information can be shared more effectively with shareholders,” says Al-Khodhair.
“The changes, however, are not only process-driven. We have seen a cognitive change in the way our stakeholders view the business. We’re not a profit centre, we’re actually a cost centre. By implementing this technology we’ve driven many blue-chip practices you don’t usually see in national oil companies. There is now an element of accountability that may have not been there before and means that the business runs more efficiently and more productively.”
When reports were done manually, they could take around eight to ten weeks to produce and compile, but now this process takes 22 days. “In the past it took much longer to develop our annual business plan. Since implementing IBM Cognos 8 BI, we have saved four weeks in man-hours in creating our business plan. Prior to introducing the IBM Cognos system, the plan would be finalised by 31 July, however due to inconsistencies between spreadsheets the plan would be severely delayed. Using the IBM Cognos system, we finalised the business plan on 3 July and were free to release reports to shareholders at the end of the month.”
The company now expects this technology to improve further when it’s linked with Microsoft® PowerPoint®. “This will allow us to deliver monthly reports the day after month-end to the shareholders. This currently takes a week to collate information and will again have an impactupon improving staff productivity.”
According to Al-Khodhair, “Our ability to collate information quickly is comparable to the performance of blue-chip companies and unheard of in the oil industry. Following the implementation of IBM Cognos technology, the business has more accurate information available to shareholders, while also helping staff improve how they deliver these results.”
About IBM Cognos BI and Performance Management
IBM Cognos business intelligence (BI) and performance management solutions deliver world-leading enterprise planning, consolidation and BI software, support and services to help companies plan, understand and manage financial and operational performance. IBM Cognos solutions bring together technology, analytical applications, best practices, and a broad network of partners to give customers an open, adaptive and complete performance solution. Over 23,000 customers in more than 135 countries around the world choose IBM Cognos solutions.
Products and services used
IBM products and services that were used in this case study.
Cognos 8 Business Intelligence
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