S-OIL: Embracing cloud ERP to position the business for future growth and innovation
Driving 40 business process improvements in 10 key functions
S-OIL Corporation is a leading global energy and chemicals provider committed to sustainable growth. To respond to a rapidly changing market environment and support large-scale business expansion, the company undertook a full-scale upgrade of its ERP system by adopting SAP S/4HANA Cloud Private Edition through the RISE with SAP journey. As a result, S-OIL successfully enhanced operational efficiency by delivering roughly 40 improvements in 10 key areas.
| Industry | Region | Company Size | Partner |
| Oil, gas, and energy | Seoul, South Korea | 3,500 employees | Samsung SDS |
improvements realized for business- process efficiency.
(US$3.65 million) in expected savings, based on estimated time savings.
Senior Manager, IT Operation Team, S-OIL Corporation
Optimizing business agility and resources in line with business expansion
Based in South Korea, S-OIL Corporation manufactures oil-refining, lube-oil, and petrochemical products for domestic and international buyers. Its Vision 2035 is this: “To be the most competitive, innovative, and trusted energy and chemical company.” To realize this vision, the company has set strategic goals centered on safety reinforcement, chemical expansion, profitability enhancement, green advancement, and operational excellence.
S-OIL aimed to leverage digital technology and innovation to respond swiftly to changes in the business environment, support continuous business growth, and ensure smoother global operations. Its key goals included enhancing productivity through process automation and optimization and enabling strategic, data-driven decision-making through business intelligence. In addition, the company sought to establish a system for information sharing and collaboration based on standardized processes.
The company had continuously upgraded its IT systems over the years to support the expansion of its polymer business and the establishment of its Singapore subsidiary. However, with the launch of its new overseas entities in Europe and the large-scale expansion of its petrochemical business, S-OIL decided to refine its ERP to reinforce its business agility and resource optimization. It identified approximately 40 company-wide business processes and system tasks that could be improved.
Senior Manager, IT Operation Team, S-OIL Corporation
Transitioning to cloud ERP to strengthen key business areas
S-OIL migrated from SAP ERP Central Component to SAP S/4HANA Cloud Private Edition through the RISE with SAP journey to streamline its key business processes, all hosted on Microsoft Azure. This included sales, logistics, procurement, production, plant maintenance, quality control, finance, treasury management, accounting, and HR. Approximately 3,500 employees and partners currently use the solution in three business areas (refining, lube oil, and petrochemicals) and two overseas subsidiaries. Adopting the SAP HANA database allowed S-OIL to decrease time for certain tasks, which can now be performed in web and mobile environments through functionality in SAP Fiori apps, leading to an overall uptick in productivity. Samsung SDS helped S-OIL with the greenfield rebuild, which involved carrying out a large-scale custom program transition and applying new solution features.
The company also deployed the SAP SuccessFactors HCM portfolio to manage its core HR and talent processes, supporting the development of more than 3,500 employees. The portfolio includes solutions for onboarding, performance and goals, and learning, as well as the opportunity marketplace. The integration of SAP SuccessFactors with S-OIL’s SAP software landscape creates its HR context. This elevates the enterprise by enabling data-driven workforce strategies, enhancing the employee experience, and aligning its talent management with its business goals. See the diagram for the system architecture at S-OIL.
Senior Manager, IT Operation Team, S-OIL Corporation
Driving process standardization, integration, and efficiency
Deploying SAP S/4HANA Cloud Private Edition has allowed S-OIL to simplify its processes, increase efficiency and interorganizational collaboration, integrate enterprise-wide reports and dashboards into a centralized business-intelligence portal, and modernize analytics tools for users. By embracing standard processes supported by cloud ERP software, S-OIL can strengthen the effectiveness, visibility, and integration of its business functions and ramp up its responsiveness to market opportunities. Targeting efficiency improvements in the few-dozen business processes, based on estimated time savings, is expected to yield approximately KRW 5 billion (US$3.65 million) per year.
In the finance and management accounting areas, S-OIL enhanced temporary-voucher processing, established standardized lease-accounting practices, minimized manual input for tax reporting, and automated foreign currency receipt processing, all contributing to greater operational efficiency. Additionally, the company improved its budget management functions and segment accounting for clearer performance tracking by business unit.
For sales and logistics, S-OIL has streamlined processes for trading, product-exchange shipments and settlements, and transportation cost settlements. The company also has integrated warehouse management system functionalities into its ERP system and enhanced visibility in import operations. In the production domain, S-OIL enhanced production planning and execution, routine maintenance, and preventive maintenance tasks. The company also improved the issuance process for shipment certificates, reducing the employee workload. Using SAP Fiori apps further enhanced the working environment by offering faster query and download speeds and access to functionalities through a web-based interface. S-OIL has also strengthened data security by using innovative security technologies, 24x7 monitoring, centralized compliance with regulatory requirements, and standardized security configurations.
Senior Manager, IT Operation Team, S-OIL Corporation
Accelerating business innovation and adoption of AI-based services
Going forward, S-OIL plans to accelerate its business innovation by making use of scalable features, such as the latest AI functionality, in SAP S/4HANA Cloud Private Edition. While there are no immediate plans to apply SAP Business AI to specific business challenges or goals, the company intends to evaluate its potential future use. It’s particularly interested in AI-based capabilities, such as the Joule copilot, that can be used with its cloud ERP.
Featured partner
With 40 years of expertise, Samsung SDS provides IT services based on generative AI and cloud computing, as well as digital logistics. The consultancy is globally recognized for its specialized cloud services that support clients’ digital innovation, including the recently launched Samsung Cloud Platform. Samsung SDS showed a strong understanding of S-OIL’s operations and systems due to its experience with the ERP implementation for the polymer business and Singapore subsidiary.