Case Studies

Tsingtao Brewery Prepares for Global Growth with Oracle E-Business Suite

Oracle E-Business Suite not only provides us with an integrated and scalable business platform, but it gives us best-practice methods and guidelines for running a global enterprise.

"The objective of Tsingtao Brewery Co. is to develop into a global company that can meet international requirements for business operations, financial management, and market expansion. Oracle E-Business Suite not only provides us with an integrated and scalable business platform, but it gives us best-practice methods and guidelines for running a global enterprise." -- Liu Yingdi, Director and Deputy General Manager, Tsingtao Brewery Co. Ltd.

China's Leading Brewery Goes Global
After the recent admission of China to the World Trade Organization, competition has intensified in the country's beer market. To stay competitive, Tsingtao Brewing Co. Ltd., the maker of one of the most recognized Chinese brands, decided it needed to modernize its business systems and become a truly global company. Tsingtao introduced Oracle E-Business Suite just in time to accomplish this goal. With Oracle, Tsingtao is now accelerating and integrating the flow of information and capital across the company and laying a solid foundation for successfully competing in global markets.

Oracle E-Business Suite applications will help Tsingtao Brewery implement new customer-centric concepts, such as "freshness management," and manage the company's fast growth. The brewery has been pursuing a "leapfrog" strategy, merging smaller operations in an effort to gain market share. At the same time, Tsingtao Brewery wants to preserve the organizational values that represent the company's core competencies. Tsingtao Brewery's balanced strategy and integrated IT infrastructure will enable the company to become a global organization while preserving its ability to adopt new ideas and make rapid strategic adjustments.

Phased Implementation
Tsingtao Brewery took a phased approach to implementing the Oracle platform. The strategy started with developing a global deployment plan and then followed with launching a pilot project at the company's South China operations. The pilot will form the basis of a model that the brewery will introduce to other divisions in a step-by-step fashion. Where possible, the company plans to standardize the applications to reduce technical risks, decrease costs, and maximize re-usability in other departments.

The E-Business Suite applications implemented in the pilot included Oracle Inventory, Purchasing, Order Management and Financials. Because of Oracle's unified data model and application integration capabilities, Tsingtao Brewery will be able to add new business units easily and gradually eliminate "information islands."

High-Level Project Goals
  • Modernize business operations
  • Lay foundation for successful competition in a global market

Why Oracle?
Tsingtao Brewery chose Oracle E-Business Suite because of its 100% internet architecture and its ability to scale rapidly. Oracle9i Database and Oracle9i Application Server will enable the company to build a central database and integrate business information from each branch operation. Oracle's single-database model will increase system availability and greatly reduce the total cost of ownership.

"There were three deciding factors: first was Oracle's excellent system; secondly, the skilled, experienced implementation team; and lastly, strong support services," said Liu Yingdi, director and deputy general manager for IT deployment at Tsingtao Beer. "Oracle E-Business Suite not only provides us with an integrated and scalable business platform, but it also gives us best-practice methods for running a global enterprise."

Strong Support from Besthelp
Tsingtao Brewery turned to Besthelp Consulting to help implement Oracle's enterprise-resource planning (ERP) system. The firm was chosen because of its deep experience in large-scale IT implementations. Besthelp also had a close relationship with Oracle and innovative ideas about how to best deploy Oracle E-Business Suite across a global technology platform. It was on Besthelp's advice that Tsingtao decided on its phased implementation approach.

Smooth Implementation
Tsingtao Brewery successfully implemented the Oracle pilot project in the South China division headquarters and five of its enterprises (four factories and a sales branch) in late 2002. The company is using the pilot to build up implementation experience, train managers, and refine the system model before rolling the solution out to new divisions. Ultimately, Tsingtao plans to integrate the entire company and its different markets, brands, and capital resources.

Future Growth
Already the Oracle Inventory system has yielded tangible benefits by enabling the company to increase the efficiency of it warehouse operations. As more parts of the company adopt Oracle E-Business Suite, Tsingtao Brewery plans to gain more benefits, including better coordination between the firm's brands and more efficient allocation of financial and other resources. Ultimately, Tsingtao Brewery not only expects to grow in size, but in competitiveness and profitability as well.

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