Cloud over HPCL upgrade of ERP software
Uday Shankar shows no signs of letting up on his corruption allegations against state-owned companies.
This time, the former Hindustan Petroleum Management Staff Association working president is focused on HPCL's decision to upgrade its Enterprise Resource Planning (ERP) software to handle daily business operations. Shankar sent a complaint to the CBI director Praveen Sood on March 4 (2024), copied to Narendra Modi, oil minister Hardeep Puri, the chief vigilance commissioner and the Public Sector Enterprises Board chairman.
"I wish to bring to your attention the widespread corruption prevalent in HPCL," he writes. "I have been raising several issues of corruption in the Maharatna PSU, but no one ever heard me or took cognisance of my complaints; even CVC has not taken cognisance of my complaints to date."
Shankar alleges a major "scam" is behind HPCL's decision to purchase ERP software in 2023 from Germany's SAP Software. He stresses that HPCL decided to use Oracle's JD Edwards ERP software in 2002 even though BPCL and IndianOil chose SAP's software then.
"At the time it was decided JD Edwards was better suited to HPCL's needs," writes Shankar. He tells this report that "sometime in October-November 2023, the HPCL board decided to scrap the JD Edwards software and purchase SAP software for over Rs500cr ($60.3m)."
Shankar's CBI complaint claims Oracle's JD Edwards ERP software was "stable, was working well and was running smoothly and seamlessly." In contrast, he alleges that after implementing the SAP software "the state of affairs in HPCL is extremely bad, no system is working; it is extremely difficult to carry out day-to-day tasks, business is severely affected."
He alleges supply and distribution officers, retail and direct sales officers, packed and bulk transporters, and dealers are "facing acute problems due to this substandard ERP package which has been implemented in equally lethargic and bad manner (sic)." Shankar's complaint stressed the previous JD Edwards software "was totally customised to the needs of HPCL, the implementation started in 2002 and got completed by 2008-09 and then was working absolutely fine."
According to Shankar's complaint, an investigation is needed into the procurement procedure, why approval for the SAP purchase was sanctioned and by whom, any irregularities in the procedure and CAG (Comptroller and Auditor General - the government's audit watchdog) and other audit observations on the purchase.