Hilal Foods Gains Real-Time Insight to Improve Operations Using SAP on AWS
A Technology-Driven Food Company
Hilal Foods is one of the leading food manufacturing companies in Pakistan. Since its founding in 1957, Hilal Foods has been manufacturing high-quality confectionery and baking products, and beverages with a continuous focus on innovation, food safety, nutrition, and consumer needs. With its head office based in Karachi, the company has presence in more than 20 countries globally and 15 household brands in its portfolio. It is also part of the larger Hilal Group of Companies, comprising Hilal Foods, Hilal Care, Shalimar Foods, and Domino’s Pizza Pakistan.
Over the years, Hilal Foods has continuously invested in modern equipment, technology, and research and development to ensure consistent high-quality standards across its product range. In 2020, the business was recognized as the silver winner in the 2019 SAP MENA (Middle East and North Africa) Quality Awards in the Business Transformation Category, for using digital transformation tools effectively to optimize operations and experiences.
With SAP on AWS connected to our sales and distribution application, we get a constantly updated view of warehouse and in-market stock and can effectively plan for production and deliveries, so distributors don’t run short.”
Group Head of IT & MIS, Hilal Foods
An Accurate View for Better Decision Making
Prior to the SAP MENA Quality Awards recognition—and in line with its digital transformation strategy—Hilal Foods was seeking to replace its legacy on-premises enterprise resource planning (ERP) system. According to Omar Ibad, group head of IT & MIS at Hilal Foods, “There were no real-time updates available in the system. It made our decision making around production, sales, and other areas of the business less than optimal. We wanted a more accurate view of our operations so we could improve performance.”
In addition to replacing its ERP system, the company also wanted to run its system from the cloud. Ibad explains, “We were looking to implement a robust and lean infrastructure with minimal maintenance requirements. Because humidity in Karachi is high, this leads to a higher chance of hardware failure, resulting in potential ERP downtime.” The inability to access data can bring key business processes to a standstill. “When the ERP system isn’t available, people in the warehouse can’t view delivery schedules or issue dispatches and trucks don’t get loaded up for shipments,” Ibad says.
A Cost-Effective ERP System on the Cloud
Hilal Foods looked for a cloud provider to run its SAP S/4HANA with SAP BW/4HANA ERP solution. It engaged Abacus Cambridge Partners—a Consulting Partner in AWS Partner Network (APN) and an AWS Solution Provider—to make recommendations. After a detailed study of Hilal Food’s business needs and challenges, Abacus suggested AWS for its reliability in overcoming hardware and hosting issues. Ibad comments, “After speaking to Abacus, we realized that many businesses globally were running SAP on AWS in a cost-effective way, delivering the real-time insight we were after.”
Hilal Foods collaborated with Abacus and SAP to launch SAP on AWS. The implementation was completed in three key stages. Abacus configured the basic infrastructure, including Amazon Elastic Compute Cloud (Amazon EC2) X1e and R4 instances, with 488 gigabytes of memory and 64 compute cores for the production environment. For security and to optimize service availability, it included an AWS Virtual Private Network (AWS VPN) connected to the AWS US East (N. Virginia) Region. Abacus also built in redundant internet links in order to offer sufficient capacity for all end users. “If we needed any technical support for AWS, we could always count on Abacus. Abacus also trained our IT team to handle operational and management tasks associated with SAP on AWS,” says Ibad.
Gains Significant Cost Savings
Development was completed in three months, and then Abacus worked with Hilal Foods and SAP to launch a quality assurance (QA) environment on AWS for its SAP applications. Once QA was done, Abacus used SUSE Linux Enterprise Server (SLES) for SAP to deliver high availability for Hilal Foods’ SAP production environment. It also incorporated Amazon Elastic Block Store (Amazon EBS) to manage the SAP system’s intensive workloads at scale, and it uses AWS CloudTrail and Amazon CloudWatch for governance, compliance, operational auditing, and performance monitoring.
“By running SAP on AWS, we’ve reduced the IT infrastructure costs of our ERP system by a significant amount,” says Ibad. “Our savings include the capex of refreshing hardware every few years and less management time.” In addition, the business no longer had to allocate multiple IT personnel to administer different parts of the ERP stack, such as infrastructure, software, and network security. Today, one IT administrator oversees the entire SAP on AWS solution, freeing up resources to manage other IT operations and focus on enhancing business productivity.
Furthermore, by using AWS, Hilal Foods has eliminated downtime. “No downtime means no interruptions and a constant flow of data providing further insights across all functions to make better decisions,” says Ibad.
Improves Manufacturing Efficiency
Hilal Foods has also been able to improve efficiency on the factory floor with fast and reliable access to SAP on AWS. This increased efficiency has led to a reduction in production wastage of about 2 percent. “Waste is inherent in any production process,” says Ibad. By tracking real-time data in its SAP on AWS ERP solution, such as raw-material use against output, Hilal Foods can identify where problems in production are causing wastage. “We can see where the variances are and take immediate corrective action,” says Ibad.
Additionally, with accurate, up-to-the-minute information, the company gains greater control of its inventory. “We know how much stock we have at any one time in our warehouse and the age of that stock,” says Ibad. “We can take measures to liquidate slow-moving stock before it expires, reducing stock wastage.”
More Effective Distribution Channel
By running SAP on the AWS Cloud, Hilal Foods can seamlessly integrate its ERP solution with other business applications, enabling the business to work more effectively. For example, the company has linked its SAP on AWS solution with its distributor management application to gain highly accurate data on inventories at distributor sites, which helps avoid shortages. “We have over 500 distributors across Pakistan and 25 percent of them are responsible for about 75 percent of our revenue. It’s important that these distributors are well-stocked with our products and don’t run out because lead times can go up to a week in some cases, owing to the distances and the road networks. With SAP on AWS connected to our sales and distribution application, we get a constantly updated view of warehouse and in-market stock and can effectively plan for production and deliveries, so distributors don’t run short.”
Responding Quickly to a Crisis
When the COVID-19 pandemic hit, Hilal Care—part of the larger Hilal Group providing personal and healthcare-related products—had to respond quickly when it noticed an immediate shortage of hand sanitizers in Pakistan. With SAP on AWS, the IT team at Hilal Foods could quickly onboard Hilal Care’s requirements onto the ERP system, scaling to support the broader group IT needs.
“Running SAP on the AWS Cloud versus on premises meant that we could leverage the scalability of the cloud to support expanded needs, without going through an infrastructure upgrade. Hilal Care used data available in our SAP S/4HANA ERP solution to coordinate deliveries with suppliers for a new hand sanitizer product, and it took just weeks to get the product into market, against an average timeframe of months for product releases,” comments Ibad.
Business Intelligence on the Horizon
Hilal Foods plans to leverage the analytical capabilities of SAP on AWS to support product development. With SAP S/4HANA running on AWS, the company is well positioned to support advanced analytics. Ibad concludes, “Looking ahead, we plan to fully use analytics to reveal new insights so we can plan new products or go-to-market strategies.”
To learn more, visit SAP on AWS.
About Hilal Foods
Hilal Foods is one of the leading food manufacturing companies in Pakistan. Since 1957, Hilal Foods have been manufacturing high-quality confectionery and baking products and beverages. With 15 household brands in its portfolio, Hilal Foods has a global presence in more than 20 countries.
Benefits of AWS
- Eliminates ERP downtime
- Cuts IT costs for ERP system
- Reduces waste with real-time data access
- Lowers stock losses with better insight
- Achieves record time-to-market for new products
- Maintains revenue with more efficient distribution channels
AWS Services Used
Amazon Elastic Compute Cloud
Amazon Elastic Compute Cloud (Amazon EC2) is a web service that provides secure, resizable compute capacity in the cloud. It is designed to make web-scale cloud computing easier for developers.
AWS Virtual Private Network
AWS Virtual Private Network solutions establish secure connections between your on-premises networks, remote offices, client devices, and the AWS global network.
Amazon Elastic Block Store
Amazon Elastic Block Store (EBS) is an easy to use, high performance block storage service designed for use with Amazon Elastic Compute Cloud (EC2) for both throughput and transaction intensive workloads at any scale.
Amazon CloudWatch is a monitoring and observability service built for DevOps engineers, developers, site reliability engineers (SREs), and IT managers.
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