How iGate Solved Its ERP Challenge after the Patni Acquisition

Summary:

The much talked about merger of Patni and iGate in 2011 posed a challenge for iGate’s CIO who had to choose between the two disparate ERPs. Here’s what he did and how he did it.

iGate Solutions’ (a Nasdaq-listed IT company) $1.2 billion acquisition of Patni Computer Systems—a former IT services and business solution provider—in January 2011 was touted as the largest M&A deal in the Indian IT industry. But such large deals come with equally large challenges. The CIO of the now merged organizations had to integrate two disparate ERPs—that of Patni’s, PeopleSoft 9.0, and iGate’s PeopleSoft 8.x which they planned to migrate to a new SAP system later. “Originally, we had invested in a new ERP solution in December 2010. We were working towards migrating our existing PeopleSoft application and data to the new SAP system by January 2012,” says Chella Namasivayam, CIO, iGate. The company had earmarked the entire month of February, 2012 to train all its 8,700 users on the new SAP system before the news of acquisition broke out. Challenges The merger basically meant that even if Namasivayam were to continue the deployment, he would still have to migrate the entire fleet of Patni employees who were on PeopleSoft 9.0 to the new ERP which was still untested in the production environment. And he would have to execute two change management processes which would ensure that the 8,700 existing users, along with the 18,000 new users understand the interface, the working of the application, and reporting among other aspects. But Namasivayam had another option too.  If he were to maintain two separate ERP systems, all iGate users on the new SAP and Patni’s on PeopleSoft, he would need a business intelligence layer to consolidate reports as well as important business-enabling functions such as sales, support, and management. But this wouldn’t give the desired results. For instance, if a resource management group wanted to know the number of resources with specific skill-sets available in the company, it would need to wait for 24 hours to avail the report. And that’s just an operational bottleneck. The other reason was, as Namasivayam, who spearheaded the entire project, explains, “it would have been an expensive option from a product licensing and maintenance perspective.” If an ERP implementation is in itself a common bully, integrating two disparate ones would be a nightmare for the CIO. But Namasivayam decided to keep a cool head in an environment where a lot of things were about to change.

A lot of companies today look at it from the perspective that if the release management process is strong, the adoption rate will be high.

Implementation In the end, Namasivayam and his team decided to invest in neither of the two. He chose Patni’s PeopleSoft 9.0 as the standard ERP for the newly merged iGate-Patni. He and his team spent a mere six months for the entire ERP rollout: Two-three months to migrate all the data and applications, two months of user acceptance test, and one month of training. The best and easiest option was to migrate iGate’s earlier ERP, PeopleSoft 8.x, to PeopleSoft 9.0, and train only the 8,700 users of iGate. This way, only a minor change management process was required. Since Patni’s 18,000 employees were already familiar with 9.0, the amount of new learning required by Employee Self-Service and Management Self-Service users was very limited. Benefits: Now, not only are both the companies on the same PeopleSoft ERP, the newly merged company also has abundant resources to take care of ERP migration and consolidation. “ERP can be very resource-hungry, both from an infrastructure as well as a human resource perspective. Earlier, we would have required 110 people to handle two ERP systems. Now, we are doing it with only 30-odd people,” says Namasivayam. Additionally, there has been a 30 percent hike in user efficiency since the implementation. The new ERP system is easy to use from an end-user’s perspective, and its infrastructural requirement is only one-fourth of SAP’s for a given set of users. “Out of 100, only 50-60 percent is about the ERP implementation itself. The rest is about adoption by the organization. A lot of companies today look at it from the perspective that if the release management process is strong, the adoption rate will be high. And if the adoption rate is great, there would be less number of problems to deal with,” concludes Namasivayam. Shubhra Rishi is a correspondent for CIO India and ComputerWorld India. Send your feedback to shubhra_rishi@idgindia.com. Follow Shubhra on Twitter at @ShubhraRishi

A lot of companies today look at it from the perspective that if the release management process is strong, the adoption rate will be high.