The company undertook a digital migration to successfully adopt InTWO’s Microsoft Dynamics ERP solution, for enhanced operational coordination.
The GCC Air Conditioner Market is expected to expand at a CAGR of 7.3% for the five year period between 2017-2023, according to researchandmarkets.com. Major infrastructure development projects in several countries in the region – including metros, airports, high value hospitality properties and malls – are a prominent driver for this anticipated growth. The emerging emphasis on economic diversification and associated government initiatives are another reason for the expected growth in the GCC refrigeration and air-conditioning market. This expansion is in contrast to a brief lull which coincided with the slump in oil prices that began mid 2014, which especially affected sales in Saudi Arabia, Kuwait and Oman most significantly. With a new impetus in activity, enterprises operating in this highly competitive space are responding with a focus on reinforcing process efficiencies, in order to generate operational advantages.
At Fawaz Refrigeration and Air Conditioning Co. we realized that our rapid expansion into new territories needed to be accompanied by enhanced coordination between geographically remote teams. In order to reinforce our competitive edge in this keenly contested business sector, we undertook a company-wide migration to a comprehensive ERP solution. Our business model is driven by a commitment to delivering the highest standards of service and products within the new markets we have entered. Adopting an effective ERP solution was crucial to addressing these challenges and developing the efficiencies required to meet and exceed our goals.
A central motivation for the implementation of an effective ERP ecosystem, for Fawaz Refrigeration and Air-Conditioning Co. was the rapid growth of the company into diverse locations and countries across the Middle East. With operations expanding into Oman, Bahrain, KSA, Kuwait and UAE, the high visibility of group performance metrics, across locations and teams, was a crucial operational ability for the company to achieve.
Post the implementation of the ERP system we are already experiencing a better insight into available resources and expenses, along with better management and tracking of budgets, subcontractors and our entire supply chain. An additional advantage is the system generated comprehensive group financial reporting.
From a customer perspective, in order for the enterprise to deliver the highest standards of service possible, we needed to address a consolidation of data that was previously in discrete silos. As a business we were also aware that some of our most mission critical functions were hamstrung due to the use of obsolete technology. We recognized that some of the software solutions we were using to coordinate and monitor our operations were very rudimentary. A dependence on solutions with limited functionality – such as excel sheets and ad-hoc home grown legacy applications across the business – was resulting in bottlenecks in terms of efficiency. The company’s ambitious growth and our desire to optimize our processes were the key drivers for the ERP solution we chose to implement.
Our commitment to this digital revamp of our operations has been a crucial strategic initiative for the company to take. Having process critical information at our fingertips – in real-time – delivers numerous advantages for the company, our customers at our diverse locations and across our entire value chain. Our vision for Fawaz Refrigeration and Air Conditioning’s future business operations is reflected in our decision to pursue a presence across several countries in the region and we felt that addressing process efficiencies and capacities was key to the success of this initiative.
We are in fact among the first movers in this space to implement the new Dynamics 365 in an enterprise segment. There are some unique requirements that we needed to implement from a contracting perspective. Microsoft provides a highly effective base environment for processes such as accounting, procurement and sales etc. but there is a vertical component pertaining to contracting which we also needed to address as a company. I am glad to say that, having implemented this upgrade, we were able to add significant value to some engagements that are unique to this aspect of our business.
The technologies we were using at a lot of our locations were generating bottlenecks in terms of maintenance and due to the fact that they were inadequate for processes, following our expansion. From a technology perspective the lack of consolidated information was a primary motivator for our decision to move to an ERP system that reflected our recently enhanced operational profile. This was also an essential pre-requisite to eliminating inefficiencies from a planning perspective. In addition to being able to rationalize our business processes across new locations, we also needed to address an expansion of portfolio and services, based on new partnerships and new relationships. An effective ERP system implementation gave us the operational agility to react proactively to new opportunities and environments.
Our vision, for this implementation, was to create the most coherent and internally consistent operations possible, for our organization. Our mission was to create synergies in capacity and efficiency that would deliver a much more future ready business model for the company, along with enhancing current operations. The legacy systems, that were limiting our potential, had been deployed on the basis of localized concerns and short term requirements. Such solutions tend to create limitations in data flow, process efficiencies and compromised quality. While enacting this transformation we invested a great deal of time and effort into identifying very specific business goals and requirements that we needed to optimize.
We enlisted the services of a consulting partner who provided the company with crucial advice in identifying challenges and opportunities within our processes and organizational structure. The consulting partner did an RFP and an assessment of multiple vendors followed by a full evaluation of process and a final award of contract. About eight months into the implementation there was a second leg of our engagement with them, during the course of which they assisted us in assessing the ongoing results of our upgrade. In terms of the speed with which the adoption of Dynamics 365 was undertaken, especially taking into account such a large and diversified environment, this was probably one of the most ambitious and unique implementations of this nature in the Middle East.
As an ERP solution, Microsoft Dynamics reconciles user friendly simplicity with a very powerful solution that integrates process specific efficiencies with macro business goals, across numerous operational teams and locations. The implementation of our transformation process was greatly simplified by the intuitive nature of the solution and the ease with which we were able to address our requirements as well as skilling our stakeholders in the solution.
One of the notable benefits of the implementation of Microsoft Dynamics 365 was the reduction of manpower costs by nearly 33% across the departments.
I cannot speak highly enough of the result invested and hands-on partnership that Intwo provided us, in the course of what was a very challenging and ambitious process. For an ERP vendor to deliver results their ability to understand the needs of a client, and their industry at large, can be even more critical to success than product expertise. During the course of our engagement with Intwo we found their highly qualified team to be not only extremely thorough in their knowledge of their product, but also very proficient in addressing our specific concerns and requirements.
Intwo were able to comprehensively demonstrate the suitability of the MS Dynamics solution to our needs in highly specific and exhaustive detail. They proved to be a very capable partner who assisted us in every step of this challenging journey. I believe ‘s ability to communicate and collaborate effectively was even more crucial to the success of this transformation than their highly qualified and capable domain expertise. This entire process was a highly ambitious undertaking that required highly focused attention to detail and I believe our partnership with Intwo was central to the positive outcome we were able to achieve.
The most positive part of our adaptation to the technology upgrade was the much quicker than usual implementation. The training of end users was undertaken very successfully, because of which the integration of the new system with our business processes was excellent. Intwo’s experience in the contracting industry from previous implementations and overall footprint in the region underscored their credibility, along with the evaluation of our consulting partner. There are a lot of challenges to such an implementation, with teething issues being common. However, Intwo was able to assist us in overcoming such upgrade stabilization issues very competently.
Organizations expanding on an international scale need the support of technologies that consolidate data and allow full visibility of operations carried out in different locations. Microsoft and Intwo have helped us take the next step in our digital transformation journey by optimizing operations.
As a company we needed to decide whether to go for an initial roll out across all locations or whether to wait for an upgrade at one location and then a go for a broader implementation. We chose the latter option and it was helpful in focusing the efforts towards the upskilling of users. After monitoring the initial upgrade we were able to implement a second roll out in Kuwait within nine months. The roll out in KSA will also be implemented over the coming months. We are one of the very few companies to have gone live with an upgrade in the region and the speed and effectiveness with which it was implemented is quite impressive and unprecedented, in my opinion.
Our experience so far, in the course of our partnership with Microsoft and Intwo, has been extremely gratifying. Incorporating technology enhancements and operational solutions can have a very defining impact on business prospects. We at Fawaz Refrigeration and Air-Conditioning Co. can confidently claim to have executed an ERP implementation with the highest standards of process integrity and positive business outcomes.
Fawaz Refrigeration and Air-conditioning Co. WLL (Head Office) was established on 30th May 1973 as an Electro-Mechanical contracting company in Kuwait. The company has now expanded its services into Saudi Arabia, UAE, Qatar, Bahrain, Yemen Oman and Iraq. Over the years Fawaz Refrigeration and Air-Conditioning has developed into a diversified multinational business enterprise with engineering, contracting, planning & control, installation, operation & maintenance, manufacturing & trading operations. The projects executed by the company include airports, mixed use, commercial, residential and industrial buildings, along with power plants, mosques, sports facilities and healthcare venues. Fawaz Group employs a total of 3600 Staff members and 1500 skilled workers across the Middle East.
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