Tech Shines Virally

IT, like the goods it deals with, has been a fast moving thing for Amway. The
progress has been fast, the lapses too came out quickly and the learnings have
been fast too.

With 175 points of presence across the country, connected through various
MPLS or wireless networks, keeping an electronic tab on the company was
certainly no mean task. However, the first step towards simplification was a
data center, which is based in Noida now.

With expansion and time, the requirements increased and in order to meet
those, layers of IT were added to manage and monitor the organization. A
significant milestone towards a sophisticated IT infrastructure perhaps for
Amway came when the company deployed a homegrown ERP across the country.

According to Sanjay Malhotra, India CIO for Amway, "This ERP is a homegrown
system that takes care of things like automation, vendor management, and
distribution."

Once the ERP came along, it sort of formed the backbone, and from there on,
Malhotra has experimented with a lot of things.

The Virtual Moolah

One of the most successful projects for Amway has been the growth and the
evolution of its e-commerce platform. Malhotra admits that though they embarked
on the e-commerce path back in 2004, it did not go too well initially.

"Typically, in our business, 30% of the business transactions happen in the
last three days of the month. Our older infrastructure couldnt support that
kind of load," says Malhotra. It was then that the idea of a new platform
started mushrooming. However, this time one thing was clear; this one had to be
a radical shift from the earlier model that they were following.

Our older infrastructure couldnt support bulk business transactions that happen in the last three days of the month	Sanjay Malhotra, India CIO, Amway

So Malhotra put together a cross-functional team encompassing all departments
and even some customers. Malhotra says that bringing in the customers voice
right at the very beginning of the process was something that worked well for
them.

Another thing that acted as an advantage was the fact that Amway, like most
distribution companies, boasts of a captive audience. Thus, the task of
spreading awareness was limited to a set of chosen people. They embarked on a
training drive, and trained some 20,000 members.

However, acceptance for them came only gradually, and the results have
started showing only off late. While the e-commerce part was contributing less
than 1% to the business back in 2004, it now contributes a significant 13%. The
new platform took an investment of almost Rs 1 mn.

Challenging Game

For any CIO, according to Malhotra, one of the biggest challenges is the
skill-set availability. And, he says that despite the fact that he deployed a
homegrown ERP. However, he adds that as the business advances, the shift to a
vendor ERP might also be on the cards.

Managing expectations and communicating value is the next challenge on
Malhotras list. He says that since tech has fewer takers it needs more
convincing for adoption. However, he is of the view that all these issues can be
managed by spreading awareness and communicating what IT can do for you. Funds,
luckily have so far not been a major challenge.

The other thing that Amway is working on is to further develop its mobile
ordering platform which was flagged off in December 2009. Going forward,
Malhotra aims to deploy a CRM system, streamline Amways home delivery process,
and look more closely at the customer information security tools.

Mehak Chawla

mehakc@cybermedia.co.in