Case study Sinosteel
Sinosteel Strengthens Business Management with ERP Applications
1. What is the business of Sinosteel, what are its major challenges, and how would an ERP system address the challenges they face?
Sinosteel Corporation is a company submitted to the administration of the State-Owned Assets Supervision and Administration Commission. Its main activity is to develop and process metallurgical mineral resources. In addition, it has a mission of trading and delivering raw materials and services linked to the metallurgical sector. Its main units work on R&D, Trade&Logistics and Equipment Supply Resource.
The major challenges that Sinosteel has are to manage its 76 subsidiaries, among which 53 are in China and 23 abroad. It grew thanks to the absorption of many tiny companies, as well as some medium and bigger ones. As a result, it has many different employees and information systems to deal with. For example, a customer can owe money to one subsidiary and be paid by a second one, making the customer relationship quite messy, and creating information conflicts. Furthermore, the coding is different between subsidiaries, which can potentially lead to delivering a wrong order in the wrong place, to the wrong customer. Finally, managerial regulations are fluctuating from a subsidiary to the other, and there is a pretty high information risk due to a lack of tracking and control of the information.
An ERP system could be the key to unlock this heavy door of difficulties, as it can globally monitor and highly standardize the information to an enterprise scope. Not only can it grant an efficient management of all core business functions, but it also achieves information sharing and thus improves efficiency. In a scattered company like this one, needing a broad general system to enable communication between subsidiaries, an ERP system proves helpful because it consists in building a tool on a whole company scale.
2. Why did Sinosteel pursue the development of