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IT Case Study Mitsui O.S.K. Lines, Ltd. Looking into new systems for more sophisticated operations Mitsui O.S.K. Lines, which has just celebrated its 130th anniversary, is one of the largest players worldwide in the area of shipping. While operat- ing a wide range of different types of vessels, the company is working to strengthen its management base. In 2009 the company began to rebuild its “headquarters accounting system” and the “core front office system,” which is used to manage voyage profitability, vessel movements (operation status), charter contracts, and fuel. The profitability of the international shipping business is drastically affected by rising fuel costs. Under these circum- stances, the company was looking to build new systems that would let users from various different departments assess data about charters, fuel costs, and vessel movements in real time so that the profitability of each shipping voyage could be quickly and accurately reflected in the balance sheet. Utilizing NSSOL’s standard AP architecture and the cloud NS Solutions(NSSOL) proceeded to provide comprehensive support extend- ing from building the applications and IT infrastructure through the entire deployment process to actual operation. Because of the large scale of the project, MOL Information Systems, which acted as coordinator, divided the development work into two phases. In phase 1, NSSOL started up the head- quarters accounting system using Oracle E-Business Suite R12 in April 2012. In phase 2, it developed a core front office system from scratch; this system has been operating since April 2014. For developing the core front office system, NSSOL employed its standard AP architecture “AmiNavire,” which is based on the .NET Framework. This served to improve both qual- ity and productivity. The IT infrastructure for both systems is the managed cloud service known as “absonne Enterprise Cloud Service.” New IT systems accelerate management upgrading The new system, called “Minerva,” reflect the extensive know-how of Mit- sui O.S.K. Lines. With regard to tramp vessels operating on an irregular schedule in particular, it enables assessment of the profitability of the vessel for each voyage in close to real time. Through integration with the core front office system, it reduces data re-entry operations and improves data consis- tency, as well as the efficiency of the settlement process. Building English- language support into the user interface also allows easy deployment at group member companies overseas. The use of AmiNavire and the absonne Enterprise Cloud Service with their proven track record ensures high stabil- ity of the system core. NSSOL services for system operations, covering the entire range of applications and the cloud IT infrastructure, made it possible to establish a framework that reliably supports 24x7 uptime. Strengthening Competitiveness of Operations by Rebuilding Headquarters IT Systems NSSOL provides AP, infrastructure/development, and operation Minerva internal modules (used company-wide) Minerva internal modules (for tramp vessels) Systems running on absonne Enterprise Cloud Service Oracle EBS: Oracle E-Business Suite Main external systems Interface to external systems Common management/ Non-specialized AC Voyage profitability Movement update Fuel Charter vessels Oracle EBS R11 Fixed assets EPOCH ACE Fuel MAX Charter vessels Port terminals Container assets management Port terminals Labor costs Container assets management Labor costs E-STEP (General name for collection of individual systems) Minerva (Comprehensive system) Oracle EBS R12 ProPlus [Fixed assets] Accounts settlement Old system New system ■Outline of Minerva system deployed for Mitsui O.S.K. Lines E-STEP and Minerva are internal names for systems of Mitsui O.S.K. Lines Mitsui O.S.K. Lines, Ltd. Head Office: Toranomon 2-1-1, Minato-ku, Tokyo Established: 1884 Capital: 65.4 billion yen (as of March 31, 2014) Net sales: 1,729.4 billion yen consolidated (fiscal year ended March 2014) Number of employees: 10,289 consolidated (as of March 31, 2014) Yoshiki Kimura General Manager Systems Consultation & Development Department (A), Systems Consultation & Development Department (C) MOL Information Systems, Ltd. Takuji Deguchi Assistant Manager Application Control Team (A) Systems Consultation & Development Department (A) MOL Information Systems, Ltd. Junko Sakamoto Manager Infrastructure Administration & Technical Support Team (A) Network Service Department MOL Information Systems, Ltd. Solutions Background Outlook Mitsui O.S.K. Lines successfully estab- lished a high-quality operations on a global level. Profitability for each voyage can be assessed in close to real time, and management of receivables and payables information has been strengthened. NS Solutions was selected as an IT part- ner . The company was to provide com- prehensive support, including applica- tion development, moving the IT infrastructure to the cloud, application and IT infrastructure operation. The aim was to realize more sophisticated operations by rebuilding the IT system. While strengthening interal control and IFRS support, users from a wide range of departments were to be given the ability to perform operations on a global level. ■Core technologies ERP, AmiNavire, Visual Basic .NET, managed cloud services, operation outsourcing ■System outline • Cloud service: absonne Enterprise Cloud Service • Applications: Oracle E-Business Suite, developed from scratch using .NET Key to Success The reason why Mitsui O.S.K. Lines wanted to rebuild its headquarters ac- counting system and core front office system was to achieve more sophis- ticated internal business operations in keeping with a changed business environment. Mr. Yoshiki Kimura of MOL Infor- mation Systems, who served as proj- ect manager of the current project, commented as follows: “Discussions started when we were looking toward strengthening our internal integration and IFRS support. Eventually, with a view toward the future, we decided to thoroughly overhaul our entire sys- tem. By building specific know-how about voyage profitability and move- ment control, as well as fuel manage- ment and charter vessel management, into the system, we wanted to ensure that a wide range of people from dif- ferent departments would be able to perform high-level management and control tasks.” Another issue was the fact that the existing systems had succumbed to individual optimization. Mr. Takuji Deguchi of MOL Information Sys- tems, recalls, “Previously the mod- ules for voyage profitability, move- ment control, fuel management, and charter vessel management had been developed using different architec- tures, which often led to the need for data re-entry.” NSSOL was the IT partner selected by MOL Information Systems for the development of Minerva, a new system designed to overcome these issues. Because of the large scale of the system, deployment was divided into separate phases for the head- quarters accounting system and the core front office system. During 2011, when phase 1 for deployment of the headquarters accounting system was underway, it was decided to also go ahead with moving the IT infrastruc- ture into the cloud. Ms. Junko Sakamoto of MOL In- formation Systems, explains how this decision came about: “At the time, the performance of the IA servers was improving rapidly, and cloud services were becoming more widespread. They offered the significant advan- tage of freeing us from the burden of operating and maintaining the infra- structure. We felt that they definitely had a future.” NSSOL used cloud distributed development environment Due to the large scale of the project, there were also a significant number of hurdles that had to be overcome. As Mr. Deguchi recollects, “Espe- cially in phase 2, delays in defining all the requirements and conditions led to shifts in the schedule for test- ing and implementation, which were sometimes hard to control. The sup- port from NSSOL was an important factor enabling us to carry on with the project over a period of four and a half years.” Mr. Kimura adds, “Although the schedule was tight, NSSOL made full use of its cloud-based distributed system development environment and its unique AP architecture, and they impressed us by developing high- quality applications within short periods of time. I feel that the appli- cations have been put on a solid base, and the stability of the cloud services that are the backbone of the system is excellent.” In April 2014 phase 2 of Minerva was completed, and the entire system went into full operation. NSSOL is still in charge of operations as well, covering the entire scope from ap- plications to the IT infrastructure. As Ms. Sakamoto puts it, “The NSSOL operators examine the content of ev- ery alert and notify us only of signifi- cant ones. Response is always very quick, and even late at night problems are addressed swiftly.” Mr. Kimura concludes, “We now have a new business operations base that incorporates the full know-how of Mitsui O.S.K. Lines. With the aim of becoming even more cost competi- tive, we will make use of this tool to enable us to act swiftly on a global scale.”
