How can you transform at speed to build value that lasts?
IJM shared several objectives for their digital transformation journey:
- Group harmonization and standardisation of business processes,
- Planning and operations optimization through making data-driven decisions,
- Procurement transformation,
- Enabling technology for a digital world, and
- Enhancing the employee experience
One of the company's key objectives is to become more data-led, leveraging data analytics to gain a holistic view of their businesses. By doing so, they can improve decision-making, increase operational efficiency, and respond quickly to market changes and opportunities.
The digital transformation aligns IJM with the industry trend towards leveraging data analytics to drive business growth and innovation.
“We want to help IJM with their procurement spend analysis across all their business divisions” – said Anderson Ding, Partner, Technology Consulting
“This ranges from answering their queries on how much IJM spends on A4 paper across the group to helping IJM make a real-time decision without waiting for two weeks for a group report to be extracted,” he added.
The transformation of IJM’s procurement processes is also on the radar which can result in cost savings, process efficiencies, and better relationship with their suppliers. This transformation is crucial as procurement processes can be taxing leading to inefficiencies and higher costs. Digitizing the process can help IJM achieve better control, transparency, and cost management while improving their collaboration with suppliers.
Enabling technology is also part of IJM’s digital transformation journey to drive growth, reduce costs, and improve customer experience.
The company aims to integrate their backend systems, standardize processes, and move towards a single system for finance, Chart Of Accounts, consolidation, payment, and cash flow. By doing so, they can achieve real-time visibility of their financial performance and make informed decisions.
Lastly, IJM aims to enhance employee experience by creating a cohesive culture across their different divisions. They understand that a strong culture is critical to attracting and retaining top talent. By investing in employee engagement initiatives and creating a good employer of choice branding, they aim to become a destination employer for the best talent.
IJM Group embarks on a digital transformation journey
Once bitten, twice shy. Despite their aspirations, IJM was understandably hesitant about investing in IT projects, given that many of such projects had failed them in the past. However, as digital transformation is critical for their survival and growth, they are willing to once again invest in the right technologies and partners to make it happen. With the right strategy, implementation, and support shown by EY,they are optimistic about achieving their digital transformation goals and reaping the benefits.
“The EY team helped to drive the harmonisation and standardisation of the group’s processes across accounting operations and reporting, core logistics operations, manufacturing operations and talent processes. We also helped IJM to realise quantifiable benefits from the transformation of their procurement systems. “said Tan Kee Huat, Partner, Technology Consulting,
Team EY assessed their readiness from the inside-out, including evaluating their people's preparedness for change and IT readiness. As they did not have the skill sets, we implemented our design for transformation, which included group design and standardisation, harmonisation of Chart of Accounts (COA), and utilizing SAP as the baseline solution for all divisions, except for their plantation and property divisions. We successfully consolidated over 20 systems into a single platfom, leveraging our expertise in SAP and change management from EY People Advisory Services team.
Business benefits that IJM realized from the transformation included :
1. Group and division dashboards
a. Enterprise visibility into the Group’s financial performance and the respective business KPIs
b. Drilldown capabilities and real-time analytics from the finance system to the dashboards
c. Management by exception
2. Finance
a. Record to report processes is standardised and harmonised across all the business divisions
b. Ensure that all the divisions comply to the Group business processes
c. Faster financial closing as all the information/data are in SAP S/4HANA
3. Procurement and Sourcing
a. Visibility into spend analytics which provides the foundation for vendor management strategy
b. Provide buyer-supplier matching services and instantly connect with suppliers
c. Digitalized collaboration with suppliers on the sourcing platform ensures efficient Source to Contract process with proper governance
4. Sales
a. Quote to Cash scenario is integrated which provides Availability to Promise to clients
b. Visibility into the revenue recognition
c. Credit limit checks reduces financial exposure
5. Manufacturing
a. Plan to Produce is integrated from manufacturing to procurement to finance
b. Reduces inventory as production is based on planned orders
6. Plant Maintenance
a. Reduces the Mean Time to Repair (MTTR) and Mean Time Between Repair (MTBR)
b. Increase asset utilization
7. Employee Engagement
We then mobilized our team and delivered results within 22 months. Subsequently, we scaled up the implementation, rolling it out to various groups. The next division to adopt the solution was the toll division, which added on to the existing system and transitioned to implementation. We standardized their processes and migrated them to SAP. Going forward, if they acquire other businesses, they can easily integrate them into SAP, ensuring harmonization across the organization.
“ I would like to express my utmost appreciation for the outstanding project implementation services provided by your team. The level of professionalism and expertise demonstrated throughout the project was truly remarkable. Your team's efforts were instrumental in helping our company standardize and harmonize our group system across 5 divisions and the holding company seamlessly within 22-month period.
From the initial planning phase to the final execution, your team worked diligently to ensure that all project milestones were met within budget and with just a reasonable few months delay due to lockdown. As a result of your team's efforts, we were able to achieve cost savings in the multi-million ringgit savings by the second year of implementation. The level of communication and transparency provided throughout the project was also noteworthy, allowing us to remain informed and make well-informed decisions throughout the process.
Overall, I am highly satisfied with the project implementation services provided by EY and would strongly recommend your team to anyone seeking a committed partner that delivers the highest quality results.”
– Chee Yih Tzuen, Chief Information Officer of IJM Corporation Berhad
Ability to weather the Covid-19 and emerge stronger and better
2019 is a memorable year for almost everyone in the world, so do IJM. As Covid-19 hits the world, Creating a sustainable value for our client were part of our transformation strategy.
Despite their existing strong team, we closely collaborated with them to implement changes in their system. We began by building a baseline and template, and then empowered them to independently roll out these changes to multiple countries. Our approach was centered on leaving a lasting legacy, rather than just completing a project, so that IJM could continue driving the transformation autonomously in the future.
IJM believes that adopting modern procurement practices with an agile digital mindset is crucial in prioritizing streamlined supplier data management, automated procurement experiences, and comprehensive vendor portals. These initiatives aim to enhance vendor satisfaction and foster stronger customer relationships, by leveraging technology to optimize procurement processes and enable more efficient interactions with suppliers.
It is crucial to recognize why leaders like IJM need to adopt a digital innovation mindset in the post-Covid-19 world. The pandemic has prompted organizations to embrace new technologies and rapidly advance their digital maturity by several years in a short span of time. IJM has been proactive in adopting digital initiatives, which have helped them navigate through the challenging times and make necessary adjustments to reimagine and reinvent their future in order to not just survive but thrive in today's fast-paced business landscape
