‘Samsung Electronics’ DNA’ began to be transplanted in the financial affiliates of Samsung, such as Samsung Fire & Marine Insurance and Samsung Life Insurance, in earnest. The two financial affiliates will invest hundreds of billions of Korean Won and apply the SAP Core Insurance solution, which was applied to Samsung Electronics ERP. Following Samsung Securities and Samsung Card, Samsung Fire & Marine Insurance and Samsung Life Insurance are carrying out the next-generation project. So Samsung SDS is generating hundreds of billions of Korean Won in revenues in the financial sector even though it withdrew from the external financial system integration (SI) business.
According to financial industry insiders on January 27, Samsung Fire & Marine Insurance invested KRW450 billion, equivalent to 5.6% of its equity capital, and began to implement the SAP ERP-based next-generation insurance system. Samsung Life Insurance will also inject about KRW200 billion to carry out the next-generation project and apply SAP solutions.
The next-generation projects of Samsung Fire & Marine Insurance and Samsung Life Insurance are part of the enhancement project of the Samsung Group. Originally the Samsung Group decided to apply SAP ERP of Samsung Electronics to all its financial affiliates in the belief that they are behind its manufacturing and service affiliates in the enhancement project. Afterwards, Ernst & Young and Deloitte Consulting provided consulting service with focus on applying SAP solutions to the next-generation system.
After long discussions, Samsung Securities and Samsung Card concluded that they could not apply SAP solutions because of local circumstances, and decided to develop their own solutions. Samsung Fire & Marine Insurance and Samsung Life Insurance chose to apply the ERP solutions that have the Core Insurance functions of SAP.
Samsung Fire & Marine Insurance will carry out the next-generation project from this month till the end of February 2017. To reinforce the competitiveness of its global business, it is planning to implement the process innovation and ERP system from the viewpoint of enterprise-wide optimization. A Samsung Fire & Marine Insurance insider said, “This project will focus on implementation of the account system to the exclusion of the information system.”
Samsung Life Insurance is also recently conducting the next-generation project that applies SAP solutions. It activated the next-generation system back in 2011, but is revamping the system by applying SAP as part of the group’s endeavor to enhance its financial affiliates. Samsung Life Insurance is injecting a substantial amount of money amounting to KRW200 billion into its next-generation system. Samsung Securities and Samsung Card developed their own system without applying SAP solutions. Samsung Securities began to run its next-generation system in May 2013, while Samsung Card will complete its next-generation system this coming February.
Thanks to the consecutive next-generation projects of Samsung’s financial affiliates, Samsung SDS is generating more than KRW200 billion in revenues every year. Starting with Samsung Securities’ next-generation project in 2012, Samsung SDS will continue to get involved in the next-generation projects of Samsung Card, Samsung Life Insurance and Samsung Fire & Marine Insurance. It recently entered into an agreement with Samsung Fire & Marine Insurance for developing ERP system packages worth KRW178.6 billion. This agreement is big enough to account for 2.53% of its annual sales. It is slated to sign a contract with Samsung Life Insurance pretty soon.