The document contain the ERP implementation and benefits attained by implementing an ERP system in a pharmaceutical company like Sanofi. Specially in Pakistani market.

1. Successful Implementation of Enterprise Resource Planning
(ERP) System in Sanofi Pakistan
Arsalan Humayun, Hammad Tariq, Syed Talha Ahmed, Usama Khan
Institute of Business Management, Department of Supply Chain, Korangi Creek –
Karachi.
Abstract
Over the past few years, organization all over the world have realized the need for an ERP
System as it aims to streamline all Business Function and Business processes that reside within
the functional areas of the organization . But organization need to be careful while implementing
an ERP system was that they must ensure their organization Structure, Business Function and
culture is in line with the ERP system as ERP System by its name implies a certain way of doing
a business consequently, there must a synergy between the organization and ERP System.
This report talks about ERP Module Implementation in Sanofi Genzyme in order to streamline
its Business Processes of Accounting and Finance, Human Resource Sales, and distribution
and Supply chain department. In addition, the report also incorporates details about the benefits
that Sanofi Genzyme has got due to the implementation of ERP. For instance, financial reports
were automatically generated through Accounting and Finance module for internal and external
analysis and cost-cutting mechanism. Similarly, Human Resource Managers were able to
manage their workforce in a more efficient manner by streamlining the Payroll and Performance
Management process. Also, Sales and Supply chain activities were smoothened due to the
implementation of ERP System in Sanofi Genzyme. On a whole, ERP module Implementation
for Sanofi is beneficial for the entire organization in the long run and it's 4 functional areas which
include Accounting and Finance, Human Resource, Marketing and Sales and Supply chain
department as it increases the overall effectiveness and efficiency of Sanofi Genzyme.
Methodology
Our study is based on empirical research based on a case study using interviews. We designed
questionnaires that we discussed with participants in order to determine how the Enterprise
Resource Planning system works at Sanofi Pakistan. The methodology focusses on conducting
interviews with the department heads of finance, human resource, supply chain and sales and
distribution. Based on existing literatures, we found out that the implementation of an ERP
system involves many challenges that a company has to face. However, if a company is careful
and takes certain steps the company is able to implement the system without any hassle.
Introduction
Sanofi came into existence in 1973 as a subsolar of Elf Aquitaine when the company took the
control over a pharmaceutical company called “Labaz Group”. Sanofi is a multinational company
which became the fifth largest pharmaceutical company in 2013 with its headquarter located in
Gentilly, France. In 2004, Sanofi - Synthélabo merged with Aventis and renamed itself to “Sanofi
Aventis”. However, in May 2011 the company changed its name to “Sanofi”. A vital role is
played by the research and development department at Sanofi and manufacturing and
marketing of pharmaceutical drugs primarily in the market of medicines is the core business of
Sanofi. There is an ideology that is followed by Sanofi in the overall organization which are
seizing outdoor expansion opportunities, advancement in research and development and

2. accepting the company’s model to future opportunities. The aim of Sanofi is to accommodate
and help over a population of 7 billion with a healthy lifestyle and doing that with the help of over
110,000 employees placed in over 100 countries.
Sanofi ensures that all of the data of the company on its electronic system that are Electronic
Management System and Electronic Directory Management. It aids them in returning and
retrieving the data in regards of the entire history and information on all of their relevant
customers. The Software that Sanofi is currently using is SAP-Unity which is a global based
ERP system that is functioned from their head office in France. A team from the head office of
Sanofi from France visits Sanofi Pakistan to download and install the software in the local
computers to make sure that they are efficiently active. It took approximately 6months to 1 year
to make the System active because of the fact that the System keep on updating itself. It takes
a sufficient amount of time to ensure that the system is completely operational as numerous
functions are required to be connected to the system on an intervallic basis. ERP System
brought a major Change in the way Sanofi functions as there was a drastic shift from manual
record keeping to computerized software. Although in the initial stages workers were resistant to
change and were in need of excessive training to get familiarity with the software and there was
a fear in employee that they will be replaced by an automated system.
The ERP is an essential requirement for SANOFI as all the data relating to all Functional areas
of their organization are stored in it and all the ERP Modules are integrated for making
extraction of data easier for the employees of the company. The data that is stored in the ERP
System is used to forecast current demand of Medicines by Consumers but the drug regulatory
authority of Pakistan assign's a quota related to Medicine Production which every multi-national
company in Pakistan is allowed and no Pharmaceutical company cannot produce beyond the
assigned Quota. One of the major drugs produced by Sanofi is Haemaccel (DRUG) in which the
Acetone is used to make that product but the amount of Acetone that is used to make
Haemaccel completely is determined by on the current and forecasted demand of consumers.
So ERP system makes it easier for Sanofi to Plan out their Production Process based on the
Demand Forecast created from the data stored in the ERP System and produce according to
the level of Quota assigned to their company.
In Pakistan the quota that is assigned to different companies varies according to the type of
Drug it produces .If the company produces a Generic Drug for Cough flu and Fever Medicines
then a Large quota may be given to such a company by the Authority of Pakistan but if the Drug
is for some Specific Disease like Sugar, Diabetes or some kind of Anti-Biotic then the Quota
given to such companies will be less as compared to a generic drug producer Company.
Therefore, the quota given to Pharmaceutical Companies varies as per their product type.
In addition, SAP Unity ERP System installed in ERP System helps in reducing wastage of Raw
material. Such an ERP System helps in managing purchase of Raw material of Drugs according
to the Quota Specified by Pakistan Authority to the company otherwise there are high chances
that the raw material ordered would be wasted. We can take an example that if Sanofi has
ordered 100 units of raw material for Drug Production but only 20% of the raw material is used
to produce as per the assigned quota then 80% of the raw material would have been wasted.
Therefore, such an ERP System helps the company in managing the purchase of raw material
and reduces wastage of raw material.
Moreover, ERP System in Sanofi has helped them in managing their capacity of their
warehouse. Now the company can order raw material as per the capacity requirement of their
warehouse. We can take an example that if Sanofi’s Warehouse idle capacity is only 70 items
and the warehouse department orders 120 of item as there was previously no electronic system

3. capturing the idle capacity of warehouse. Consequently, 50 of the items ordered will be wasted
due to insufficient space in warehouse. Moreover, Raw material order should be aligned with
the demand of customer and this process became streamlined due to the ERP System which
contains information of customer that is used to derive demand and such information can be
used to order raw material as per demand of the customers. Therefore, Such a System helps
not only in managing Capacity of Warehouse but also helps the company in managing the
demand of the customers for the products of the company.
Furthermore, Sanofi was in need to develop an extensive planning process for producing the
products as per market requirement and also ordering quantities as per the demand of the
customer in the market. Also, Sanofi wanted to identify the potential markets in which their
products can be sold so that they can fill the gap left by the other companies in the
Pharmaceutical industry. Considering the fact that if there is an epidemic of diarrhea in such a
Sanofi will be producing more FLAGYL But if Malaria has spread in the environment, then
Nivaquine-P will be produced. This entire process will either make or break their strategy.
Therefore, ERP System at Sanofi is the best solution for managing their market demand and
production plan of their Products. Also, ERP System helps Sanofi in solving their two main
problems. One of the main problems that Sanofi was facing was that it was unable to meet
demand of their consumers either due to insufficient raw material or wrong machinery used
resulting in a flawed product. Ultimately, the competitors of Sanofi could easily take advantage
of this opportunity. On the other hand, Sanofi at times did not consider the market situation and
demand and overproduced products which ultimately reduced their profits. Consequently, due to
ERP Implementation in Sanofi, they could easily manage the demand and supply mechanism
and were able to satisfy the needs of their customers. Moreover, ERP System have integrated
all the four functional area of operation through a centralized database which has help Sanofi in
streamlining their Business Functions and Processes. Currently in Karachi head office of Sanofi
they have supply chain, finance and accounting departments.
Lastly Collaboration and Coordination is very important while making a forecast of the brand
they are about to produce. Whatever objective sales and marketing departments have, these
objectives are changed into numerical through which backward working is done in order to see
how many units of raw material will be required to produce the product, how many units of the
product will be needed in the market and inspect the shelf life of a product. And these factors
help in developing a comprehensive plan in the production and planning process of Sanofi.
Sanofi want their inventory to be more produced within 15 days. The BOM to produce the
medicine should have a lapse time of 15 days. So that the next batch can be manufactured in
accordance with these raw materials
BOM examples of a Particular medicine:
 Lactose
 Talc
 Magnesium stearate
 Sucrose
 Gelatin
 Shellac
 Glaze
As far as Sanofi different production lines are concerned, the products are prepared through
one Production line and once one product is produced then the same Production line will be
used for producing another Product. We can take an example that if Sanofi wants to
manufacture or produce 100,000 units of Claforan antibiotic then these type of products will be

4. produces via one line of production until they are able to produce enough amount that supplies
for 3 months. Post the production the same production line can be used for another medication
for Tarivid supply for another 3 months. Therefore the production process is continuously based
on one Single Production Line through the effective use of resources and planning strategies.
The production department has an entire planning mechanism based on the type of raw
materials to be used such as the bill of materials (ingredients) for manufacturing medicines and
the packaging material. Through the integrated ERP system the supply chain department is able
to manage its inbound and outbound logistic operations.
Literature Reviews
According to the author Alexandra Kanellou (2012), details about the accounting and
financial benefits achieved by implementing the modern Enterprise resource planning software
over previously used information systems. The major emphasis of the article is to articulate the
major advantages and disadvantages of the accounting and financial module of ERP systems.
Secondly, the aim of the study is to know how finance and IT professionals assess the
advantages of Financial Modules in an organization. The research involved 176 Finance
professionals and 96 IT professionals from 193 companies in Greece. The results which were
obtained from the study portrayed no significant difference in advantages of financial module
implementation for Finance and IT professionals. Furthermore, it was concluded that
by the implementation of Financial and Accounting modules, organizations do work efficiently
which has reduced cost significantly and made it more effective.
According to Ejaz Ali (2015), Large and complex organization are dealing their Business
function and Processes through Enterprise Resource Systems (ERP).Human Resource
Management or Human Capital Management is a core Business function that any organization
requires to fulfill their need or requirement of Human resource practices which is only possible
through an ERP System i.e Human resource Information System (HRIS). HRIS actually
provides them real solution to implement the Human Resource Management (HRM) practices in
an innovative and efficient manner. In addition, Considering the Popularity of HRIS, many Small
and Medium Enterprises are also adopting such ERP System as it helps to solve their Problems
in an effective and efficient manner. As Far as the Role of Human Resource Information System
is concerned, it is not only restricted to managing the workforce within the organization but it
also covers the metrics module that measure the performance of employees and rewards them
on the basis of their performance in form of Compensation. Moreover, Human Resource
Information System also has sub modules of Compensation which includes both intrinsic and
extrinsic reward as every employee need is different and everyone is not motivated by monetary
or non- monetary reward as a result the employees of the company will be motivated to work for
the organization helping the organization achieve a competitive advantage in the market.
Furthermore, one of the most important modules of Human resource Information System is
Recruitment and Selection as Employee or Human resource is one of the major source which
helps an organization in achieving success within the world and competitive edge over
competitors in the market. Hence, from the above it can be concluded ERP Systems helps large
and complex organization in running their Business functions and Processes in a smooth and
efficient manner and earn high profits or returns for the company as it helps in selecting the right
person for the right job, measuring their Job performance and compensating them according to
their performance in the organization. On a whole it can be said that ERP system makes it
easier for organization to manage their workforce in a cost effective manner.
According to Nandini Padiyar (2015), Sales and Distribution (SD) module is the most
important module of SAP. It handles all the processes from order to delivery. In today’s

5. competitive business environment, companies are increasingly being forced to streamline
business processes. In a world where it is no longer enough to simply have the best product,
companies are focusing on core competencies and closer partnerships over the whole supply
chain. SAP SD execute the business processes used in selling, shipping and billing of product
and services. It handles the activities of Sales and Distribution. This module comes with the
comprehensive set of both order and logistics management. Many of the systems are tightly
integrated with the Distribution Requirement Planning (DRP), the engine of the ‘just-in-time’
deliveries. This integration maps the supply of single site or multi-site organization. This system
can also generate replenishment orders by using warehouse requirements. Sale and
Distribution module of ERP consists of all master data, system configuration and transactions to
complete the process of Order to Cash.
Supply chain is outline of the future, Forrester (1958, p. 52), he projected that after a period
of research and growth involving basic logical technique, “there will come general respect of the
advantage enjoyed by the unique administration who have been the first to advance their
understanding of the interrelationships between separate company functions and between the
company and its markets, its industry, and its national economy.” It appears that key
management issues and illustrated the dynamics of factors linked with the experience referred
to in current business literature as Supply Chain Management (SCM). The term supply chain
management has risen to distinction over the past ten years (Cooper 1997). For example, at the
1995 Annual Conference of the Council of Logistics Management, 13.5% of the parallel session
titles contained the words “supply chain.” At the 1997 conference, just two years later, the
number of sessions containing the term rose to 22.4%. Moreover, the term is normally used to
describe administrative tasks in corporations (La Londe 1997). SCM has become such a “hot
topic” that it is difficult to pick up a publication on developed, distribution, marketing, customer
management, or shipping without seeing an article about SCM or SCM-related topics (Ross
1998).

6. A Detailed Analysis of the Modules Implemented at Sanofi Pakistan
Accounting and Finance
General Ledger
The general ledger allows the company to maintain the external accounts. Sanofi ensures that
the data of all of its vendors passes through the general ledger in order to maintain accounts by
providing real time assessment of the accounting and finance module area.
When a sales is recorded by the sales and distribution module, it comes first into the option of
general ledger. This allows the accountants to have an initial record of the transactions as soon
as it notifies him. Moreover if some other expenses like maintenance occurs like purchase of
bulbs or car painter work, it is recorded here and then added into trial balance.
Fixed Assets
Any asset which cannot turn into liquid easily is known as fixed assets. So considering the
Sanofi, it have the following fixed assets:
1. Production machinery.
2. Office building.
3. Factory building.
4. Distribution trucks.
5. Laptops, mobile phones etc.
In ERP there is a concept of cost center. What ERP do is, its A/F module let it make a cost
center of each of the fixed assets. Like there is a cost center of a syrup filling machine called
SFM1.1.2. (S= Syrup, F= filling, M= Machine, 1= location of the plant, 1= floor, 2= room.) So this
cost center will contain and record every cost occurred for this machine like maintenance or
upgradation or repairs or depreciation. So it will let you know what is the real value of that asset,
how much you have invested in the machine and so on.
Accruals
Accruals are basically your liability. This is that you took the services but you didn’t pay for
them. In Sanofi, accruals mostly work on the commission of the sales people. Sales and
distribution records the commission of the sales rep as soon as the sales is recorded. This
record is transferred to the accounts and finance and HR at the end of the month so that they
can prepare the cash and add it into the wage of the sales reps. But sometime Sanofi stops the
commission due to the bad performance in the previous months, so this is added into the
accruals so that when the performance of the sales rep is up to the mark he receives the
amount at that time.
Interest payments
This module part is not implemented in Sanofi as they don’t have to pay any interest. Sanofi is
an all equity based company and investments it uses the internal funds to finance investments.
Sanofi is not in an expansion phase so currently external financial is not required by the
company.
Inventory Costing
This is concept which refers to the calculation of the gains and losses and the cost of
purchasing of an inventory. In Sanofi, they buy the chemicals on regular basis. Like there is a

7. chemical called lactose. It cost varies from Rs 280 to Rs 300. Currently its price is Rs 281.35
per KG. So if Sanofi buys it now and by some reason it jumps to Rs 290 per kg, the material
management module will let you know the gain in the inventory. In addition to this the module
will let you have the total cost volume profit analysis of the purchase recorded by supply chain
module.
Account Receivables
This is when you are going to get the money in future. Sanofi’s transactions with its huge
customers Agha Khan on credit. So the module let you record the transaction and starts a timer
like notification that the credit period has started and this much time is left. It also notify the
client that your payment of Rs X is due and you can pay till this date. In addition to this it locks
the client so you cannot make more sales to that customer and make you notify that you should
not make sales to this person as his payment is due.
Account Payable
Account payable is an account that includes the statement and balances of creditors. Sanofi
usually works on a 90 to 120 days credit period. The module allows Sanofi to efficiently manage
its cash payments as the module generates reports and alerts when they payment to any
creditor is due. The accounts payable module includes vendor master record which has all the
purchasing and finance data from the vendor, details of the vendor such as telephone number,
vendor address, details of payments to the vendor, details of creating and managing purchases.
The account also displays vendor balances separately, vendor line items.
Furthermore, the module allows Sanofi to view a report which can be based on a selection
criteria such as Fiscal Year, Period, Date Ranges, Account, Company codes etc.
Financial Statements
Sanofi benefits from SAP in making their Financial Statements. Towards the end of the financial
year Sanofi does now have to close accounts manually as that part of the part is done by SAP
System. The A/F department does not gather data from all the other existing departments
because the data is already integrated and fed into the ERP SAP system. The SAP system
allows Sanofi to generate Income Statements and Balance sheets towards the end of the
financial year as the data is always updated in the database. The system also allows Sanofi to
create specific variants and formats on which the financial statements will be generated.
Internal and External Reporting
This subpart of the Accounting and Finance Module allows Sanofi to generate internal and
external reports. The internal reporting is used by the management and employees who review
the reports to solve the current problems that exist in the company, forecast future budgets as
per the timeline stated. The internal reports include sales report, production report, direct labor
hours report, direct labor hour cost report, operating report, schedule of debtors etc.
The external reports are generated which are more of an interest for the stakeholders that are
not part of the internal management. These include shareholders, investors, government
bodies, regulators, brokers etc. The external reporting includes financial statements, financial
models, auditor’s report, income statement and balance sheets
Chart of Account
This module of chart of account is a list of account of each company with company codes,
company name, account number and account name. It contains information on the company

8. about the company and how the company is controlled. Sanofi uses these chart of accounts to
categories each company with a separate account number. The chart of accounts can be area
specific, city specific or country specific allowing Sanofi to manage its clients efficiently. The
SAP has Chart of Account which is a list of General Ledger Accounts Master records that are
used by the Organization. The Master Chart of Account should be given to each Company
code. Chart of Accounts is defined at Company level.
Types of Chart of Account
1. Operating Chart of Account
The Operating Chart of Accounts in SAP contain the General Ledger Accounts that are used to
post accounts and balances a code of company for everyday activities and used in both
Financial Accounting and Cost Accounting. The user has to assign the Operating Chart of
Accounts to a Company Code.
2. Country Specific Chart of Accounts
The Country Specific Chart of Accounts in SAP contains the General Ledger Accounts needed
to meet the company’s Legal Requirements. The Country Specific Chart of Accounts are
assigned to Company codes and this is optional.
3. Group Chart of Accounts
The Group Chart of Accounts in SAP include the General Ledger Accounts that help the entire
corporate group of the company and this type of Chart of Account is used to consolidate and
gather the reports for the entire corporate group of the company.
Trial Balance
A trial balance is a list of account balances that include debits and credit balances of the
account. It has spilt balances which are categorized as cost centers, profit center, segment and
functional area of the business.
The trial balance allows Sanofi to properly manage each and every debit and credit account
whether it is of debtors, credits, expenses or revenues. These balances are then added to the
financial statement. The SAP allows Sanofi to manage the balances and automate the check
and balance system in the accounting and finance module.
Purchase Order (PO)
A Purchase Order (PO) is a business record and first authority offer issued by a purchaser to a
dealer, showing writes, amounts, and concurred costs for items or administrations. It is utilized
to control the obtaining of items and administrations from outside providers. The accompanying
components of a PO are utilized by Sanofi as a piece of the bookkeeping and back module:
 Vendor name and code
 Purchase organization
 Purchasing group
 Document date
 Order type
 Material type
 Material description
 Quantity
 Delivery date
 Net price
 Currency

9.  Conditions of the PO
 Purchase order history
Good Receipt for Purchase Order for Sanofi
Good Receipt for Purchase Order is a process which make sure that the goods dispatched by
the creditor has reached on time to the company and in accordance with the necessary quality.
 Material short text
 Quantity
 Batch
 Valuation
 Stock type
 Vendor details
 Document information
Invoice Overview for Sanofi
An Invoice is a document issued by the business to its customer, detailing out the services
and/or products sold to them. It creates an obligation for the buyer to pay. It lists the items sold,
their quantities, and the amount payable for each of them. An invoice typically provides the
following details:
 Details of the seller
 Details of the buyer
 Items sold, the corresponding quantity and unit price of each item
 Taxes or discounts
 Net amount payable by the buyer
 Gross amount
Human Resource Management
Every company has a certain set of objectives which it aims to achieve through efficient
management and utilization of its workforce through some Automated System or Software.
Consequently, Sanofi being one of the successful Pharmaceutical Company consist of of a
system that has a complete planning process of the employees working in the organization. The
Planning process functions in accordance with the aims and objectives of the Company. In
order to achieve the objectives set by the Company, the employees will enter a set of agenda in
the System they aim to achieve that include no of doctors to be catered , therapeutic area to
target and the man power that is required to execute the plan but all these agendas must
aligned with the objective of the company.
In addition, talking about Sanofi’s Commercial team considering if a person in marketing is
required; then the departmental head will describe the job description (JD), then describe the
reason for performing the job, the objectives of the job and in the end the need of the
department is defined, which is the complete requirements of the marketing department to hire
the individual. Moreover, The Departmental Head must give some concrete evidence and
reason for the hiring of the worker as hiring of an individual is costly process as well as it is an
investment that is made on the new recruits in form of different training and workshops.
Therefore, It is clear that Sanofi gives very much importance to Human Capital as it believes

10. that these individuals play an important role within the organization and helps the company in
achieving its goals.
As far as the ERP system at Sanofi is concerned, it consists of complete details regarding the
employees in the company. It includes detail regarding the rationale behind hiring an individual,
existing field and work force within the company, employees retired or retiring from the company
and from which division or province the employee is retiring. Considering the example that if we
have a team of 600 employees and 6 of these individuals quit from Sanofi- 3 from Sindh and 3
from Punjab, then the HR department updates such information regarding the resignation of
employees on the ERP system and the ERP system shows a red indicator that is a signal for
the firm to realize the vacancy need. Therefore, the ERP System at Sanofi shows that the job
availability and man power requirement at Sanofi along with the detail of the Division or City for
which the company requires an employee.
Furthermore, Human Resource Module at Sanofi helps in managing Human Resource
Allocation .We can the example that if in Islamabad there is a team of personnel required for a
particular task then the HR department can assign such employees or personnel to Islamabad
from Rawalpindi or Lahore as the travelling cost will be lower instead of sending employees
from Karachi. Also, Employee Relocation to different areas such as Karachi, Lahore or
Islamabad is Possible only if it is backed by proper justification. Also, the employees travelling
and personnel costs vary but these costs must be justified in a proper manner so that resources
are allocated effectively.
Payroll Management System
As far as the Payroll Management System is concerned there is an electronic system for the
payroll at Sanofi that helps the company in estimating the Total Salary Package of an employee
on the basis of the four components mentioned below:
 Gross Compensation – Includes Base Salary, Over-Time and Bonuses
 Recurring items – Includes Allowance, Loan Payments and Subsidized benefits which
includes Dental and Healthcare Benefits and Gym Memberships etc
 Ad-hoc items – Includes Medical and Sick Leaves Reimbursement of Expenses and
Expenses allocated to Employees for example fuel cost, mobile bills etc.
 Government Taxes etc...
Performance Appraisal and Promotion Criteria
Sanofi’s ERP System has the capability to evaluate the performance of employee on basis of
certain metrics in comparison to the standard set by the company. It also has the ability to
forecast the retention of an employee within the organization Consider an employee who has
been working at Sanofi for the last 3 years, all of the data pertaining to the employee
performance will be available on the system and the employee is then promoted on the basis on
such information stored in the system.
In addition, Consider an employee who stayed in the company for the last 2 years and the
company has not done any investment on him, the ERP system contains all relevant
information regarding to such employee with the aim to smoothen their the training, increment
and bonus giving process. All Such information that is stored on the system moves in a cross
functional way to disseminate the information among all the Departments of the Organization
.The ERP system maintains a complete HR record file which has complete detail of their
employee regarding their training and development, appraisals etc.

11. Talent development Program
Sanofi also has a complete talent development program on their ERP system where the
employees are required to fill information relating to their training and development every year.
Such information is constantly updated pertaining to the employees and the employees are
required to mention their aspirations, objectives, and where the employee wants to see himself
in future. Once the employee has entered all the relevant information, the management is now
responsible to decide about their future plans based on the information provided on the ERP
System about their Performance. On the basis of such information, managers are then required
to distinguish the employees based on the departments that are suitable to them and the best
role for them within the Department. The last part of Talent Development Program consists of
developing an action plan which they are required to follow for the term in order to help them
achieve their goals.
From the above Discussion, It can be said that Sanofi has an ERP System which is of great use
to the company personnel as such a system provides all information at one click and information
is readily available to all the employees of the organization whether it pertains to Payroll
Management, Performance Appraisal Metrics and Criteria or Training development of Particular
Employee. In addition, it reduces redundancy and manual effort of labor as the information is
readily available on the ERP System .Moreover the best Part of such an ERP System is that
information is not only stored but its locked and cannot be changed but it only can be extracted
for some useful purpose. Furthermore, Sanofi stores all such information on a centralized server
so that the company can recover the information if the system crashes and with the aim of
keeping organization’s information safe and secure.
Also, the information that is available for the employees of the organization is also stored in the
ERP system and the server can only be accessed by authorized users. In addition, there is a
locking system to prevent unauthorized personnel from accessing such information and
manipulating or changing the information. Consider the Performance Appraisal of an employee
who is awarded a particular grade on their performance and they are given Training and
development accordingly and all such information regarding to the employee performance is
stored and locked in the ERP System. Moreover, the employees can see their progress related
information anytime and anywhere which is the core benefit of having an integrated system.
Attendance Management System
Attendance management process works through card system where the data is locked when
every employee enters their particular card number and their attendance is marked for that
particular day and it is an everyday process which needs to be done to ensure their attendance.
In addition, Consider If an employee had taken an off for 10 days but claims that he only took 7
days off , then the ERP system will display the information regarding the attendance of the
employee and state that he had taken three extra holidays that is 10 not 7 days holidays. Also,
the leave application option shows the remaining leaves that an employee generally has that
are 20 annual leave days and out of which in this case 10 leaves have been availed by the
employee and 10 leaves are left. Therefore, attendance management system at Sanofi is done
electronically to make sure that there is solid evidence regarding the annual leaves of all
employees and with the aim of streamlining the attendance management process.
In addition, considering the terms and conditions of an employee’s leave application or the
travelling program of an employee that is based on a business trip, all such information is
recorded in the ERP system. The travel plan for all the employees is recorded in the system
ticket costs after the Management Board gives the approval .They also have an Electronic
Business Travel Authorization (EBTA) for carrying out and keeping a record of all travelling
plans cost and expenses. Furthermore, An Electronic Request Facilitation (ERF) form is

12. available for filling out and getting authorization from the Top hierarchy for travel plans. Hence
all approvals and details are electronic and processed through the ERP System.
Importance of EBTA and ERF as an Electronic System
All the Business processes are processed in an electronic way. We can an example of a
manager who has a plan on starting a program, the agreement or refusal is usually given within
3 days based on the hierarchy Structure of Sanofi. Once plans passes through middle level
management and it is approved by middle level, then the last one to approve the plan is Top
level Management before the Plan is commenced. After Approval, the plan is extracted and
stored as data in the system which is purely for the internal investigation purpose in case of a
situation or inquiry related to HR Department pertaining to HR travelling expenses and the
different activities that are carried out in the HR Department which is show through the ERP
system in different electronic form such as EBTA and ERF as a proof for the plans that were
approved and the rationale behind the expenses.
Therefore, ERP system installed in Sanofi is a safe and secured system where all the data is
stored and any employee within the organization can easily access information related to them.
For instance, an employee can view all of his/hers performance during the year on the ERP
System. Such information pertaining to the employees can also be accessed by the global team
and the comments of senior management based on the performance of the employee can also
be viewed by the employees. Ultimately, the global team bases their decision of shortlisting or
promoting the employee on the basis of the comments by Senior Management, they have seen
on the ERP System regarding employee performance. In addition, they can also view the talent
development program for suggesting appropriate action plans for such employees and help
them in availing the opportunity prevailing within the organization.
Mind Map for Human Resource Management
Human
Resource
Management
Travelling
Expenses
Departments
Management
Training
Recruiting
Challenges Performance
Evaluation
Payroll Incentives

13. Human Resource Management with SAP
Sanofi has an ERP system managed by the head office in France through SAP Unity; which is
very similar to the ERP-SAP System we have used while studying in class. There are numerous
modules in an enterprise within the SAP system which comprises of HRM module. It is
associated with different modules and it allows all to perform all kinds of HRM related functions
and tasked which can be easily saved and accessed on a centralized database. On overall it is
an automated System which manages all Human resource related information and has the
following components.
Employee Management
Payroll Management
• Gross Compensation – Includes Base Salary, Over-Time and Bonuses
• Recurring items – Includes Allowance, Loan Payments and Subsidized benefits
which includes Dental and Healthcare Benefits and Gym Memberships etc
• Ad-hoc items – Includes Medical and Sick Leaves Reimbursement of Expenses
and Expenses allocated to Employees for example fuel cost, mobile bills etc.
• Government Taxes etc...
Attendance Management
 Card System Entry
 Leave Management
 Rules and Regulations
 Training Needs
 Recruitment and Hiring Needs
 Monitoring and Reporting
Sales and Distribution
Inquiries and Quotes
This module is integrated with the IM software which a sales rep have in its iPad. It have all the
information like what price to be quoted for which medicine and upon how much order plus let
the sales rep generate the inquiry for why the medicine is not available in the market or in his
area.
Sales order
This is the main task of the SD module. It let you convert the order or requirement of the
customer in to a document which contain the information like who is the customer. To whom it
will be shipped. When the delivery can take place and so on.
Sales return:
Sales return is also an important module of SD module. The reason is that it let the company
know that why the order is returned and how much order is returned. Like in Sanofi, the chances
of the order return is very low as the orders are made and received every day. But the main
reasons why order can be returned can be as follows:
 Poor packaging.
 Open celling.
 Syrup leakage.

14. Contracts
In pharmaceutical company or in any industry, when you are selling your product through third
party place you make a contract with them. This let you set the following:
Selling price range Here you set a prices and its ranges like: Sanofi has a product called Flygel. So
if Agha khan orders 2000 units per order it will cost Rs 10/unit. It orders 4000
units per order it will cost Rs 8/unit.
Credit days A company has its own credit policy but the contract with between medical
store and pharma company allows to have a flexible range of credit limit.
Example Agha khan’s credit day limit is 120 days while times medico’s credit
day limit is 45 days.
Credit memo
Credit memo tells the company which customer has paid the payment and who have to pay and
the time limit he have to pay. At Sanofi this is a crucial matter as a pharma company have made
sales to hundreds of medical stores and doctors and dispensaries and hospitals so keeping the
record of which customer has to pay and the amount to pay is the key here. It also locks the
order which is from a customer who has to pay its dues.
How SD module is integrated with other departments and make a business
process?
The SD module is linked with Supply chain management, Accounting and finance and sub
connected with inventory management and production management. The following diagram
shows the complex business process of what happens when a customer makes an order and
how and which business processes get linked in a pharmaceutical company.
Benefits received:
 Getting the information flow of sales streamline and right across the
concerned departments
The way SD module connects SCM, IM, P&P and A/F, it make the information flow to and fro in
the company very easy. When an order comes it automatically generates the necessary
documents to be sent to SCM or to A/F or even to IM or P&P.
 Real time view of the order
It allows the sales people and SCM people the order status in the real time. Like if the order has
been cancelled they will get to know it immediately. Or if the order is updated.
 Auto check of the customer and stops you if the customer is a defaulter
It automatically check about the customer’s payment history and if the previous payment is due,
it locks the order and only accounts department can open the lock. This order is than manually
entered into the system.
 Keep linked with the inventory
It keep the inventory of finished goods in linked with the sales. Like if there are 1000 units in
finished goods but a sales order is generated of 1500 units, the system will automatically notify

15. the sales department, inventory department and production department their respective jobs.
Like for sales the job will be to tell the customer that order of 1000 units will be available in 2
days but for 500 more units you will have to wait for 3 additional days. Accordingly to inventory
management that make order to the production department that the order of 500 extra units
have been registered so start making it. Production will start making the additional 500 units and
update the FG inventory.
 Provide constant data for the forecasting of the upcoming year/quarter
Constant linkage with the production planning will make the SOP module to make forecast of
the coming month/quarter/year and will try to make as accurate as possible.
Supply Chain Management
Sanofi SAP
Sanofi uses SAP unity as its latest Enterprise Resource Planning software which helps the
enterprise in various business activities. Most important business function Supply Chain &
logistics is being handled by the same said software which helps the company in managing
supply & logistics. Sanofi’s Supply chain and Logistics module consists of production planning,
Inventory Management, Material requirement Planning, Demand Management, Sales
forecasting, Detailed Scheduling, Purchasing and Delivery/ Shipment.
ERP systems are very necessary for Sanofi as it has to store all the aggregate data and use it
for its business functions which can further help Sanofi in managing its business. The collective
data is even important as the Government of Pakistan assigns a quota for products for MNC.
Furthermore the data collected even includes the demand and sales for the desired products.
Sanofi further uses the data to forecast its sales and produce accordingly, secondly the
company has a system which helps them managing the distributors all over the nation. For
example a product X is high in demand in Punjab then Sindh then the Software will plan the
distribution of the product X accordingly to the demand function.
The software of the company manages sales rep even all the relevant data to the person is
associated to the person data and even the commission of the reps are directly linked to the
sales the person has catered.
Sanofi nearly caters to around 24000 doctors, so the SAP software computed in the company
makes sure that the product required by doctors are readily available in the nearby pharmacies
and their hospitals. Hence the SAP unity of Sanofi manages the distribution of the products in
the most effective method. Furthermore the SAP is even capable of managing the credit limits of
each customers respectively for example if any customer exceeds the credit limit or defaults in
making payments then the software restricts the customer for making any further orders, in
order to make further purchases the customers are required to make payments. This can be
override by few selected officials within the organizations.
The problem of an integrated system is that if the system crashes then the entire system within
the organization crashes disabling all the employees from work, this halts the business
operations. This happened with Sanofi once, the system breakdown was for the whole day
which halted the business operations and a designated team from France visited to make the
system function.
Furthermore the Supply chain & logistics module of Sanofi consists of inventory management as
well which is very useful as it manages all the supplies and inventory of the company. The raw

16. materials are noted down as it enters the warehouse which are used by the production
department. The finished good inventory is recorded as it reaches the warehouse which is used
by the sales and distribution department. The ERP system even lets us know how much of
inventory is left and when to order and it even notifies the concern departments of low levels of
inventory. The distribution and production is being planned by referring to the available
inventory. Furthermore the deliveries of the goods are planned accordingly. The record of driver,
vehicle used and inventory to be delivered is properly tracked to through the software.
Training of employees
After Implementation of ERP systems in Sanofi, the employees of the company were trained
both manually and digitally. As training is very necessary for employees so that they can get
familiar with the systems and can work on the systems easily without any hindrance in the work
flow of the company. The training was held under the supervision of software experts so that if
any acquaintance is required they can provide on the spot easily.
Sanofi Database
Sanofi has on site database and on cloud which makes the data more secured and accessible.
As the data of the company is very important so it is important to keep the data is secured and
protective environment. The IT department of the company has the access to all the data
available and the data is protected via passwords which are known by few officials only.

17. Conclusion and Recommendation
Human Resource Module in SAP helps in the development of your human capital Management
(HCM) as it joins all HRM applications with the respective departments. Workers and managers
are able to easily ability access data from the HR Module installed in the company. We can take
the example of different planning programs, bonus schemes given to employees overtime,
worker capability etc. Several other actions are associated with the HRM module in order to
deal with the workforce in a competent manner. For example the finance module is a functional
area that administers the wage rate of workers. In addition, there are various different
procedures that include figure outing the wage rate and tasks of the workers along with the task
of monitoring the retirement plans and wage rate of the retired workers. Moreover, Training and
Development need for a particular employee is identified through the HRM module which stores
complete detail of employee’s performance. Statistical information can therefore be found on the
ERP System to support the workforce and the employees are given rewards in view of their
performance information stored on the System. In this way SAP can also be used to provide
these functions to Sanofi to smoothen their Human resource operation although the current
ERP system is working effectively for Sanofi.
Sanofi is one of the largest pharmaceutical company operating in Pakistan, ranked on 7 th by IMS. This is
evident that how information management is important. Because in today’s competitive environment
information related to customers is an unmatchable competitive advantage which is handled by SD
module as it let you to record every transaction you do with the customer linked with CRM software.
Generating the invoice, keeping customer records, generating delivery clearance papers, pricing the
product and much more are the common features which SD module uses to give the company
competitive advantage in this competitive environment.
Sanofi Aventis being one of the largest pharmaceutical company in Pakistan which also working globally
uses one of the SAP latest software known as SAP Unity. SAP Unity helps the company cater almost
around 24000 doctors nationwide distributing its products efficiently nationwide. The SAP Unity
provides the company with latest features and modules. The supply chain & logistic department being
one of the main department of the company is being efficiently automated by SAP Unity software which
gives the company some important features such as planning, Inventory Management, Material
requirement Planning, Demand Management, Sales forecasting, Detailed Scheduling, Purchasing and
Delivery/ Shipment. These are the few features which are being used by the company which helps
company manage its resources efficiently.
Sanofi has implemented SAP-ERP in the company in almost all of the departments. One of the
Lacking that we found in the Human Resource module is that the module lacks the
organizational hierarchy element. SAP allows an organization to display the list of hierarchical
structure along with symbols that display the head of the department and supervisors. Sanofi
should include that module in the HR module in order to gain benefit by listing the
organizational structure.
As far as the accounting and finance module is concerned, Sanofi should improve the credit
period for its debtors and also improve the controls that are placed in the module. Sanofi
should reduce the manual and paper work in order to reduce costing and increase profitability.
One of the element in SAP is the generation of profitability analysis which we identified is
lacking in Sanofi. The SAP can help Sanofi improve its profitability by identifying the cost centers

18. that have high cost and identify products of which their profit margins can be increased. For a
company it is important to maintain the industry profitability margins and return on investment
margins. Sanofi can increase its margin by using SAP-ERP as the software is developed to reduce
inventory for a company.
The table below shows the profitability analysis for Sanofi Pakistan from 2010 to 2015. Some of
the margins have reduced over time which shows that Sanofi has an opportunity to increase
margins by efficiently using the SAP-ERP module.