Parle : Company Background

Challenges facing Parle and competitive advantage using IT

Need for MIS at Parle

MIS in Britannia
Problems in the Existing System Benefits of MIS at Britannia

Challenges to MIS Implementation

Implementation Strategy

Proposed new ERP System

PARLE PRODUCTS PVT. LTD BACKGROUND

Biscuits Brands Sweets

Snacks
Showcased gluco biscuits as alternative after 1947 Began Manufacturing biscuits in 1939 Founded in 1929 Parle as it is today since 1974

Occasions

Ranked 7th in Brand Equitys Most trusted Brand 2012

US $ 1 Billion conglomerate. biscuit baking oven is the largest of its type in Asia.

*Source: Business today

14 manufacturing units for biscuits & 5 for confectionaries.

5 mother units & 31 contract units.

Challenges in front of Parle G

Competitive Advantage IT can give

Profit margin of Parle G decreased from 15% of revenue to 10%.

Customer Relationship Management

E Business

Cannibalization of Parle G with new and similar products

First attempt to increase price from Rs 4 to 4.5 resulted in 40% decline in sales

Employee Advantage

Supply Chain Management

Value for money perception

Increasing input costs

Moving beyond E Mail

Timeliness

NEED FOR MIS AT PARLE

REQUIREMENT FOR MIS

Demand Forecasting

Done by sales department based on projected requirements by whole sellers & retailers Often leads to overcapacity in some areas & stockouts in others Parle has large number of SKUs, difficult to forecast accurately for each of them Parle employs substantial number of contract labor, incorrect forecasts lead to excess manforce
Information Sharing

All the information sharing between the headquarters and production facilities is done via email Each production plant gets monthly production targets via email from Mumbai headquarters Difficult for the HQ to track daily production figures No direct means of communication between different factories, has to go through Mumbai HQ
Standalone Modules

Single piece of information has to be entered into multiple software systems Instances of data inconsistency has in the past led to delivery at wrong locations
Quality Control Quality control and measurement is a completely manual process Inconsistency in the weight of biscuits coming from a particular plant led to significant loss for the company

Distribution Channel

No channel connecting Parles large network of distributors/ whole sellers etc. Difficult to create reports for 45 million retailers

REQUIREMENT FOR MIS

Measurement & Control

Currently there is no system to measure employee productivity No single analysis report is created, Different reports are created for various divisions

MIS AT WORK IN BRITANNIA

PROBLEMS IN THE EXISTING SYSTEM

SALES Secondary sales reporting which was carried out using a third party application, was static whereas dynamic data was required by Britannia. REPORTING The third part reporting was done on a month to date basis whereas the business wanted to do it at day level The reporting was done on pre aggregated data. The requirement was to consider line item level data for reporting Drill down was not possible at detailed level in a single report. Multiple reports were used to analyse the sales on different dimensions while the requirement was for a single report to analyse the secondary sales at various levels.

DATA MINING
Drag & Drop and Slice and Dice of information were not possible.

BENEFITS OF ERP AT BRITANNIA

SUPPLY CHAIN Consistent Data Sharing Increase in efficiency Reduction in operational overheads Better working capital management Increased control over inventory management Realistic production scheduling Effective cost control system Optimal usage of capacity Timely purchasing and efficient vendor management Minimal effort in following regulatory norms because of a strong excise system REPORTING Flexible reporting with multilevel drilldown Offline reporting - save offline reports on desktop Easy access to detailed information in a single report Multi dimensional reporting possible Item level reporting for better analysis MARKETING Single report for Effective Coverage of Outlets (ECO) analysis. This was earlier done using 5 or 6 different reports. ACCESSIBILITY Integration with portal for easy access - Single sign-on

PERCEIVED PROBLEMS AT PARLE

Resistance to Change
New policies and procedures will be created. New job skills must be learned. Individual job roles may change. New reporting structures may affect individuals and whole departments/functions

Politics
Inter-departmental conflict Power-brokering Not embraced at all levels

Resistance to Innovation
Perceived Risk Habit

Poor Management
Lack of Top management involvement in project- restricted to introduction level Choosing inappropriate group for implementation- project failures Unequal representation from relevant departments ERP software selection and implementation process doesnt work for everyone Insufficient training to user Selecting an inexperienced vendor No Project Management

IMPLEMENTATION STRATEGY

ERP Implementation Strategy

A Phased Transition Strategy should be implemented at Parle

Why Phased?
Each business unit can have its own instances of ERP

Reduces risk of installation, customization and operation

Interface programs help bridge gap

Often used in situations that do not have strong centralized synchronization

PROPOSED NEW ERP SYSTEM

Functional Modules
Finance PLM SCM

CRM

HCM

WMS

Inventory

Order

Project

BUSINESS INSIGHTS AND ANALYSIS

Financial Analytics

Customer Analytics

Supply Chain Analytics

Operations Analytics

Sales and Marketing Analysis

Distribution Channel Analysis

Profitability Analysis

Working Capital Optimization (C2C Cycle)

Trade Promotion Analytics

Supply Chain Performance

Divisional Sales Analysis

Plant Performance Management

Channel Analysis Product Cost & Profitability Analysis Sales Order Performance Analysis

Efficiency of Distribution Network

Evaluate Competition

Treasury Cash Analysis Integrated Customer Demand

Impact on Customer Satisfaction Region Wise Analysis MES Analytics

Analyze Risk Trends

Operational Planning Efficiency

Debtor/Payab les Analytics

Market Performance Visibility

Supply Network Efficiency

Product Sales Performance

Impact on Inventory, Sales

Forecast Profitability