Ranbaxy Utilizes In-house Team for ERP

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A case study on ERP in Pharmaceuticals
CIO TEAM
Reader ROI

 Maximum CPU utilization levels at the database server dipped from about 100 percent to 40
percent
 The maximum RAM utilization level at the server slid from 74 percent to 48 percent

Executive Summary
When Ranbaxy realized that the ERP needed an upgrade, the inherent consulting costs and
hordes of subject matter experts, were a major cause of concern. But with the help from
SAP and Microsoft, David Briskman led a team took care of the entire technical and
functional upgrade of SAP, database and OS onto the newer 64-bit architecture.

India's largest pharmaceutical company, the Rs 7,300-crore Ranbaxy is present in 125

countries, all of which run off a single instance of SAP. The company has also witnessed
double-digit growth for several years which reflected on its 2.25TB database: it expands at
about 45GB a month.

Case Study Highlights

 The cost of consultancy usually makes up between 60 and 70 percent of the total cost of the
project. The rest largely goes in procuring hardware and software

 By handling it all in-house, Ranbaxy lowered the total price of the project and reversed that ratio

All of these factors put tremendous stress on its ERP. The average response time on its
SAP servers was over 1,200 milliseconds and about 1,000 milliseconds on its DB server.
Ranbaxy also regularly hit 90 to 100 percent capacity utilization levels on its database
server. "We applied plenty of band-aids but systems began to crawl and impact the
business," says David Briskman, VP & CIO, Ranbaxy Laboratories.

To avoid an imminent crisis, Ranbaxy strategically decided to sync a SAP environment

upgrade with a hardware refresh. An ERP upgrade on this scale would have left most
organizations scampering to find the closest consultant, and hordes of subject matter
experts - immaterial of the price. But Briskman, who maintains a SAP center of excellence,
decided to leverage his internal team to carry out the project. With help from SAP and
Microsoft and led by Briskman, this team took care of the entire technical and functional
upgrade of SAP, database and OS onto the newer 64-bit architecture.
Doing the upgrade internally saved Ranbaxy plenty. "When organizations enlist consultants
for such high-level projects, the cost of consultancy usually makes up between 60 and 70
percent of the total cost of the project. The rest largely goes in procuring hardware and
software," says Briskman. By handling it all in-house, Ranbaxy lowered the total price of the
project and reversed that ratio. "In our case, 70 percent of the costs we incurred were billed
for hardware and software. That gives you a sense of how little consulting we used," says
Briskman.

Post the upgrade, maximum CPU utilization levels at the database server dipped from
about 100 percent to 40 percent, bringing life back to the sluggish servers. Similarly, the
maximum RAM utilization level at the server slid from 74 percent to 48 percent and the
average response time for an application to respond improved from about 1,000
milliseconds to just 350 milliseconds. The upgrade also reduced costs by 18 percent.