Case Studies

Changan Automobile Speeds Management Decisions with Integrated Enterprise Resource Planning Data

flexibility, modularity, scalability, and expansion capability of Oracle's software suite will be of great help in the development and further improvement of our information system in the future.

"Oracle provides a whole package of solutions, ranging from a database platform to the complete Oracle E-Business Suite. The flexibility, modularity, scalability, and expansion capability of Oracle's software suite will be of great help in the development and further improvement of our information system in the future." -- Ma Jun, Information Supervisor, Changan Automobile (Group) Liability Co. Ltd.

Roadblock to the Future: A Lack of Data Integration
China's automobile industry faces many new challenges now that the country is part of the World Trade Organization (WTO). In response to the gradual tariff cuts it faces, Changan Automobile Co. Ltd., owned by Changan Group, constantly seeks advanced management ideas and information technologies for continued development, to help maintain a competitive edge.

With over 140 years of history, Changan Automobile Liability Co. Ltd (known as Changan Group) has grown into one of China's major automobile manufacturing bases. Changan holds a leading position in China's mini-vehicle industry, with a market share of 31% and production volume of more than 1 million units. Over the past 20 years, Changan Group has been active in adopting a variety of computer technology and applications. These included 38 local area networks and information systems that serve diverse divisions within Changan including production, supply chain, marketing, human resources, financial and material management; and more.

The problem: the many diverse areas within Changan, with their different platforms and formats, had developed into "information islands," lacking any central way of accessing and sharing the wealth of information and data within each isolated application. This made analyses difficult, hampered the decision-making process, and restricted Changan's ability to respond efficiently to a volatile market.

Changan recognized the need to streamline and coordinate its data. The Group determined to set up an online exchange for Changan mini-vehicles, ultimately developing it into one of China's largest automobile e-business trading platforms. To accomplish this goal, it partnered with Oracle.

High-Level Project Goals
  • Integrate previously self-developed independent application systems
  • Establish an enterprise resource planning (ERP) system to coordinate partners, suppliers, distributors, and maintenance service providers

Why Oracle?
Changan studied solutions in use by other automobile manufacturers, including a successful Oracle supply chain solution. Oracle's advanced technology, rich product lines, integrated systems, modular structure, and successful experience in e-business platform deployment are the main factors that lead Changan to chose Oracle. "Compared to other vendors, Oracle products offer the multiple organizational structures, modularity, and flexibility we need as we develop our information system platform for the future," said Ma Jun, information supervisor for Changan Group.

In June 2001, Changan Group began working with Oracle to revise its technology and information strategies. This ultimately led to the introduction of a complete product suite from Oracle, including Oracle9i Database and Oracle E-Business Suite. Changan uses modules of Oracle E-Business Suite to automate ERP, customer-relationship management (CRM), and supply-chain management (SCM).

A Clear Highway to Efficient Information Sharing
Taking the first step towards its strategic objectives, Changan implemented ERP in December, 2001, focusing first on financial management. Then, throughout 2002, it implemented additional Oracle modules to manage financial, sales, and manufacturing functions. To help guarantee a smooth implementation, Changan Group set up a three-level organization: decision-making, management, and implementation. Then, Oracle assigned project managers with experience in automobile manufacturing as on-site project supervisors.

Using Oracle E-Business Suite and Oracle9i Database, Changan Group has integrated its formerly independent application systems. Fuller access to shared information through the new ERP system has already enabled Changan staff to realize notable benefits in working efficiency and management accuracy. "Currently, the new system is running quite smoothly. Where once it took more than one hour to run a main production plan, it now takes only 20 minutes, greatly improving our productivity," Ma Jun said. With Oracle in place, Changan Group can optimize control over its flow of information, materials, and cash.

Future Plans
Changan Group has already completed Phase One of four phases of its Oracle E-Business Suite implementation. In Phase Two, it will set up a company-oriented marketing management system, customer service system, and human resources management system. Phase Three aims to further improve internal production and procurement management, while Phase Four targets marketing, procurement, and internal ERP management for Changan's mini-vehicle industry.

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