Throughout the three decades of its existence, Pakistan State Oil has appeared as one of the largest and most profitable companies of the country. It has time and again proved to be a non-change-hesitant company in a very dynamic industry. The story of PSO’s Information Systems department is similar; the IS department keeping abreast with the changing scenarios, new technologies and ever-increasing user requirements.

The Information Systems Department was established in 1976, the year PSO was formed. For a long time the IS Department was perceived merely as a data processing center. However, during the last few years, the top management has thought proactively as to how the company can harness the potential of a modern enabling-IT-department. This meant investments in technological resources and IT infrastructure. IS was envisioned to become a strategic business unit rather than just a technical support function.

The last three to four years have observed an exponential growth in the users’ demands on the Information Systems department at PSO. Just a few years ago a personal computer was a novelty, and now almost every management employee uses a desktop PC. Not only has this increased the general computer literacy of the whole company but coupled with new management and new ideas pouring into the organization, has resulted in increased demands on the IS department.

The new systems relied heavily on another development – the establishment of a Local Area Network. The project started in mid 2001 and was completed by 2002. The Rs. 7mn project resulted in total connectivity of all the computers on each floor of PSO House. The total connectivity included the mail server, ISA Server (proxy server and the firewall for security), Semantec Server (Anti Virus Server), NNM (Network Node Manager) and all the personal computers at PSO house, linked using cascaded manageable switches. Fiber optic connectivity was provided in the back plane. Around 600 nodes using Ethernet, with backup connectivity, were ‘upped’ providing 99.9% uptimes. Formal security and network monitoring policies were also drafted after the successful implementation of LAN at PSO House.

The next logical step was the setup of a Wide Area Network. In terms of investment it was about nine times the LAN project and the aim was to connect all the locations of PSO all over the country to the head office and amongst each other for seamless information exchange. Before this connectivity between PSO Head Office and remote locations was restricted to telephone lines and surface mail.  Not only the setup of WAN avoided delay in processing and disseminating information to the users, it also laid down the road needed for any integrated solution to drive on.

Fifty-three locations were connected to the head office via an IP cloud whereas thirty- one locations via VSAT connections. Dial back modems are at each site providing for backup connections. Each remote site was provided with state of the art servers, firewalls, UPS’s for maintaining full uptimes. Each remote site has a 100 Mbps Ethernet LAN using cascaded management switches, and at least 8 nodes. VPN multimedia Channel Service has also been rented, which would reduce the lion’s share of huge communication expenses of PSO.

While the communication technologies kept on improving day in day out, the stand-alone software solutions kept mushrooming. This meant loads of databases and redundant data. Envisioning the potential problems in future, if the state of the affair continued, PSO management embarked on the road to implement an integrated solution for the whole company. The solution would amalgamate all departments and functions across a company onto a single computer system and a single database, integrating people, processes and systems. 

In February 2002, Sidat Hyder Morshed Associates (SHMA) was engaged to assist PSO in achieving these objectives. From the existing systems study and review of PSO’s business and technical requirements, an Information Systems Strategic Plan (ISSP) was evolved that suggested, amongst other steps, implementation of a company-wide Enterprise Resource Planning (ERP) system.  A comparison of such systems available in Pakistan was made after which the Oil & Gas solution of SAP R/3 was selected and Siemens Engineering Company (Siemens) was hired for its implementation.  PSO has purchased eleven modules of SAP to cover all aspects of its business, making this the most comprehensive SAP implementation within Pakistan.

The modules included Finance and Controlling, Sales Distribution and TD (transportation and distribution), Material management (supports material management functions and processes), Project System (used as a project-monitoring tool), Plant Maintenance (a solution for all maintenance activities performed), Human Resource (to manage all aspects of modern personnel administration), Quality Management (integrating quality management functions into other applications like Materials Management, Production, Sales & Distribution, and cost accounting), Production Planning (made up of resources, master recipes, process orders, process management etc.), Silo Management (part of Oil and Gas SAP solution for managing oil products inventory), TSW (for stock projection and for planning and scheduling bulk shipments using nominations), and Business Information Warehouse (for integrating external databases with internal databases and providing for extremely flexible reporting requirements).
The new system meant that we had to shift from AS/400 e620, a mid range server, to high-end servers. No longer would the 8 Gb RAM, and 17.2 GB HD of AS/400 e620 be sufficient. A hardware solution was the need of the moment to provide the processing power required for a mass scale integrated solution. Once again, PSO did not refrain from further investment and a Rs. 40 mn solution was procured from Hewlett Packard. It comprises of a clustered solution of 64-bit Unix based Servers with support of 16 processors on a single machine. PSO has procured Hp9000 rp7420 and two Hp9000 rp4440’s for the primary site and another rp7420 for the Disaster Recovery (DR) site. The DR site is designed such that the changes at the primary site are transferred online to the DR site. For this purpose a connectivity of 128 Kbps has been established between the primary and the DR site. HP Storage Works EVA 5000 would fulfill the storage requirements at both the primary and the DR site, in a SAN (Storage Area Network) environment, providing low cost - high capacity and high performance storage. Online storage has the capacity of up to 2.8 terabytes while offline storage uses tape library.
 
1st January 2005 witnessed the Go Live & Support Phase. There was a successful farewell to the legacy system. Rigorous user training by the IS department and joint efforts of all the departments finally made it possible to accomplish this seemingly impossible task of SAP successful implementation.

 All in all, the vision of every employee harnessing the maximum out of information systems department is a reality now. They have one of the most advanced and modern ERP solutions at their disposal and are able to view and analyze real-time data from the length and breadth of PSO’s operations.