Severstal and SAP announce long-term partnership

Severstal launches an ERP (Enterprise Resource Planning) project across the company to implement SAP software. As part of the partnership programme a €15.6 million contract has been signed. A fully functional ERP solution is planned to be rolled out over the next 24 months.

“The ERP implementation project will allow Severstal to review and increase the efficiency of its key business processes, from production, purchasing and sales to administration and corporate governance. This project will help us to bring together key business processes at Severstal, speed up the closure of the financial reporting process, reduce costs and significantly increase operational efficiency”, said Alexey Mordashov, Severstal CEO.

A pilot SAP ERP implementation project began in Vorkutaugol, Severstal’s mining division, in 2007. The project enabled Severstal to optimise a number of major processes in finance and purchasing. In 2009, to create consistent, high-quality and low-cost service standards a project to create shared services in finance and HRM areas was launched.

As a result of SAP’s rich expertise in the metal industry and established track record in innovation, Severstal will be better able to balance costs and the need to invest in strategic technology upgrades.