Capital Gains

DQI Bureau
New Update

It's the maker of brands like BoroPlus, Sonachandi Chyawanprash, and Navratna

Oil-names that the Indian middle class swears by. Set up in 1974, Emami-the

flagship company of the Rs 2,200 crore Emami Group-has grown into a leading

player of healthcare, beauty, and personal care products with over thirty brands

in its kitty.


IT has definitely played a key role in managing its multiple product lines,

separate locations and an ever-expanding supply chain. As Vikram Saxena, senior

GM, IT, Emami points out, "IT as a function is completely mixed with our

business. It has been implemented in a way to support all aspects of the

business." Considering this, the company went for SAP ECC 5.0 ERP implementation

in 2006. Unlike a majority of companies that played safe by deploying IT in a

phased manner, Emami took the big leap and implemented the system across its

entire operations at one go. "It took us almost a year and by January 2007, we

had fully integrated our functions with SAP," recalls Saxena. Today, it's

controlling the entire business cycle and enabling visibility of stock. Modules

that come under the SAP package include materials management, sales and

distribution, quality, finance, accounts, etc.

Taking a look at its supply chain, Saxena says, "Our FMCG business includes

suppliers, seven manufacturing units, thirty-two depots, distributors, and

retailers. SAP covers the entire supply chain internally. Also, 50% of

distributors have been integrated with the system." Now the company is targeting

to extend its ERP to external partners which will include distributors and


'50% of our distributors have been

integrated with the system'
Vikram Saxena, senior GM, IT, Emami

Among the biggest benefits, the SAP implementation has improved demand

forecasting mechanism, which in turn has improved working capital management.

Earlier, the demand was forecast by the sales to customers and distributors, and

not on the basis of consumer demand. SAP tool has helped in collating data on

stock turnover at the distributors, retail, and retail stock positions;

utilizing past trends; hence, enabling accurate estimates and lower demand

variations. Moreover with real-time information available, inventory management

has improved, thus reducing turnaround time and increasing customer

satisfaction. Also, instant availability of sales statistics has enabled the

sales team with a better control on pricing, schemes, discounts, credit checks,

and customer outstanding.

Commenting on the challenges, Saxena recalls, "Non-adaptability was one of

the major issues we faced initially. SAP implementation meant there was no scope

for backlog. As all functions were integrated, backlog at one stage got

reflected on the entire cycle. However, our employees had to be trained, not

only with IT skills, but also to bring about an attitudinal shift."

Looking forward, Saxena informs that Emami will set up a disaster recovery

site at Kolkata soon. Once operational, it will guarantee 100% uptime of SAP,

which has a current uptime of 99%. It is also planning to implement a host of

new applications with channel partners. These include human capital management (HCM),

employee self service (ESS), business information warehouse, and business

informatics among others. These apart, the Emami Group is also working on

end-to-end SAP implementation in two other sister companies, namely-Emami

Biotech and Emami Paper Mills-by the end of this year.

Monalisa Das