SMEs Need IT To Achieve Process Standardisation

The SME sector in India has been in the news recently for its bold IT initiatives. It goes without saying that CIOs are the unseen stars of this new evolution. Anil Singh, the CIO of N R Agarwal, a paper-manufacturing group throws some light on how a CIO holds his own against challenges thrown by the SME sector. He has been in the industry for 20 years, having previously worked with Godrej, Famycare, and Associated Capsules; the latter two being SMEs as well.

How different is IT in the paper industry compared to other industries?

It’s different in the sense that the end users in this industry are not very IT savvy. It is a challenge to make them understand the benefits of technology and how it can enable their individual growth as well as the company’s growth. Training plays a very important role in this change management process.

More from Biztech

Future Group - Reliance Retail Deal approved by CCI RBI ban on cryptocurrencies takes effect; prohibition could force investors to tap the black market

In what way did you manage the change, after you implemented mySAP ECC 5.0?

We went live with ECC 5.0 on 1st July 2006, and implemented modules like SD, MM, PP, FICO, QM, PM, PPPI and solution manager. The legacy system was VB Foxpro based, so we had to go through a lot of changes after implementation. Initially, we faced challenges in terms of acceptability and usage of software. We had separate training sessions to tackle this change, right from the top-level management including the MD to down the line operators. Once the employees are aware of the benefits, they understand the importance.

In about 2-3 months, as they started using the technology and services, they realised the benefits. They were able to monitor data going into the system and look at the information. Now, they’re able to analyse the data and get value out of the system. The users were apprehensive before, but now they’ve realised that it’s a positive change.

What are some of the benefits you’ve observed after deploying ERP?

We had a lot of data, which was scattered, but now our master data is refined and we have better control over it. Secondly, our credit limits were haywire and now we’ve standardised them as well. So we’ve been able to fill in gaps that were lacking in our organisation like getting a realistic picture, control on processes, transparency and process standardisation.

What are some of the recent innovations you have made in your company?

Recently, we’ve started sending SMSes and e-mails to our distributors, linked to SAP ‘Business Workplace’ and ‘Netweaver’. The order processing cycle in our industry is very fast. We get the order in the evening and despatch it in the morning; therefore the supply chain has to be strong. The customer needs information about when the truck has left our factory and is going to reach them. As soon as the truck leaves our organisation, we send SMSes and e-mails to dealers and to the end point delivery officers, where the trucks go.

Another thing we are about to launch either in September or early next year is an online order system for our distributors. This will be linked to CRM.

As a CIO of an SME organisation, what challenges you the most?

In India, the SME sector is mostly unorganised, so there are challenges from the management and operations points of view. It’s highly challenging to convince your top management to go for a new technology. We have to forecast benefits, and prove it in a short span of time. In a large organisation, that’s probably not an issue, but in the SME sector, it is.

Tell us about some future implementations and your criterion for choosing an implementation partner?

For the next year, we have scheduled the implementation of BI, CRM and mobile solution for sales. For the software, we will use solutions from SAP for both BI and CRM, since we are already using ERP from SAP and it will be easier to integrate it. With any software, you have to decide what’s the major area and what modules will add value to your business and implement that.

The implementation partner has to have a successful track record in implementing the technology. We are in the process of taking fresh offers and asking for customer references. Based on what value they got out of the particular vendor, we will make our assessment.

What is the budget you have allocated for this?

We haven’t confirmed our budget yet, but that is not a major concern for us. We analyse the value of the deployment vis a vis the value it will bring to our business. And now, since our MD has seen the benefits of our previous deployment, he is clear that IT can add value to the organisation. We are now focused on bringing the best value to the business through IT.