Piramal Healthcare Syncs Demand And Supply With SAP

Piramal Healthcare is probably one of the biggest names in the Indian pharmaceutical and a company that holds IT in high stead. This week Biztech2.com takes it readers through the pharma giant’s journey with SAP Advanced Planning &Optimization component (SAP APO), which helped boost its supply chain.

Beginning of the SAP Journey

Piramal Healthcare’s relationship with SAP began a decade ago. With a distribution network in multiple geographies and 12 manufacturing facilities in India, Piramal needed a solution that could support its complex supply chain processes and continued growth while keeping costs down as well.

“Piramal Healthcare has been one of the earliest adopters of IT solutions in India. Amongst the pharma companies, we are at the leading edge with using IT to drive our business. We deployed Sap’s first solution in 2000 and from then we’ve been adapting and using different modules as we have continued to grow as a company,” says Nadini Piramal, Executive Director, Piramal Healthcare.

Roadblocks: Legacy Systems and Manual Processes

As with most established enterprises, Piramal Healthcare had the herculean task of eliminating legacy systems and manual processes. But these seemed to be not the only on the list of challenges.

“We had legacy IT systems and people were used to working with them in a certain way. When you are used to using spreadsheets, you know what you can get, which is a limited amount of analysis. We had the huge task of getting people change their mindset and use SAP APO to its optimum so that they could benefit from the results could be got from it,” explains Nandini.

According to A Balaji, VP-IT, Piramal Healthcare, before SAP APO came into the picture, update master and transaction data took an awful lot of time. From the IT standpoint, the company faced numerous process challenges. “We, as a company are growing both organically and inorganically and have made quite a few acquisitions as well. With so much happening constantly, we have realised that it is better to relook from the business and IT solutions standpoint for smooth functioning of the business and overcoming challenges.”

Implementation

SAP Advanced Planning &Optimization component took six months to be completed with a core team of 15 members. What was unique about this implementation was a large buy-in of the stakeholders.

Piramal Healthcare had a cross-functional team working on this project and it took around six months to deploy it in all its plants. Explains Nandini, “We have been very successful with this implementation in our Baddi plant, which is a formulations plant that services the domestic market. SAP APO takes a little more time to be implemented in a plant where you can manufacture multiple products and multiple lines because. This is so because this solution functions in such a way that the system thinks that you can do only one product or a number of products in just one line. We still have to work our way and see how we can adapt to that.”

“We have named this project, ‘Project Alignment’ because here the alignment had to be made with both the business and IT. We have multiple businesses and we wanted them to be seamlessly integrated. We had approximately 15 core team members from Piramal and around seven members from Bristlecone, our implementation partner involved in this project.”

One of the best practices that team followed in this project was to involve the stakeholders in the whole process.

Benefits

Having been of the earliest adopters of SAP’s solutions among Indian pharma companies, Piramal was sure that SAP Advanced Planning &Optimization component would yield the benefits that they had hoped for. Well, they were right as it did give them the whole gamut of
financial, strategic and operational benefits.

With SAP APO, the net demand generation, advance planning system, detailed distribution system have started functioning more efficiently with a faster response time. Adds Nandini, “We have a very large portfolio of products, some of them with very small runs but very high contribution and SAP APO has helped in better scheduling this. With better scheduling our products are manufactured faster and resulting in a higher contribution.”

SAP APO has also lessened the time for change-over and stock-outs, as well as lessened the inventory base. Piramal Healthcare has now moved from push-distribution to pull-distribution and that’s critical for the business. Concludes Nandini, “The main benefit has been the lessening of stock-outs because we have varied products and therefore the demand across all regions is varied, especially since we supply across India and SAP APO has helped streamline the demand and supply.”