Presented by: Megha Dhammi

University Business School, Panjab University 2

3  Established in Bombay in 1953  One of the largest manufacturers of floor tiles in India.  NITCO Tiles is a well-known brand in the glazed tiles industry and is a major manufacturer and importer of a wide variety of tiles.  Turnover of Rs 311 crores[in March 2010].

University Business School, Panjab University 4  NITCO Tiles was using a legacy application built in Power Builder with Sybase as the backend database, which was customised by a third party.  Moreover the company wanted to go in for an IPO and get listed on the BSE and the NSE in the aftermath of said IPO.  The legacy system catered solely to business areas such as accounting, purchase and billing and there was no integration of these business areas with the company’s manufacturing plants.  With disparate legacy systems, integrating all functions, departments and processes getting complete visibility and control of operations was proving to be a difficult task for the company.  The company was also considering rationalising organisation-wide role definition and fixing of accountability.  It also wanted to re-engineer key processes and decentralise decision making while introducing the right checks and validations to ensure seamless operations.

University Business School, Panjab University 5  NITCO Tiles conducted a thorough evaluation and SAP, Oracle, JD Edwards and PeopleSoft were evaluated.  The company finally zeroed in on SAP due to its comprehensive nature, scalability and expertise in SMB implementations.  SAP had a strong focus on R&D and it also had a strong reference customer in the tiles industry.  The package also had a good proven track record, including localisation aspects.  The package had strong capabilities in financial integration and logistics and production control.  The evaluation exercise, which began in Jan 2005, was completed in four months.  SAP ECC 5.0 ERP went live in January 2006 with seven modules—Sales and Distribution, Materials Management, Production Planning, Quality Management, Plant Maintenance, Finance and Inventory.  Coconut Software was the implementation partner for this project

University Business School, Panjab University 6 1. Tile is manufactured in different stages and it is important to know the tile inventory by the quality grades and then the MRP is planned following which the discounting schemes are finalised. This required heavy customisation as the ERP package did not have a standard process to manage this. 2. the cost of transporting tiles is high as the product is bulky. Freight costing had to be done in real-time as it meant that the company could get its profitability online after the transportation cost was taken into account. 3. Data migration from the legacy to the new system was another challenge as it was tedious and time consuming. 4. Training people on the new system was also challenging.

University Business School, Panjab University 7 1. Faster Account closure 2. Visibility into product costing and faster settlements. 3. Reducing order cycle.

University Business School, Panjab University 8

9  As old as 200 years.  one of the fastest-growing branded apparel companies in India, with a CAGR of 30 percent.  Handling as it does some of India’s leading brands including Peter England, Allen Solly, Van Heusen and Louis Philippe, the company has eight factories and a warehouse.  It also has a network of 120 exclusive franchisee showrooms, 15 agents, 22 distributors and 3,500 retail outlets

University Business School, Panjab University 10  A bunch of home-grown applications created using diverse platforms such as COBOL, Ingres and FoxPro had created islands of information that were scattered willy-nilly across different departments.  The natural fallout of this was that islands of information attached to these legacy applications such as the warehouse application written in COBOL made it impossible to get any kind of meaningful information in real time.  It took more than five days to compile an MIS report for the management.  Up-to-date information was unavailable due to non-integrated systems, and modifying existing systems to address new information needs related to product development was a daunting task.  The presence of multiple technologies was making integration and modification of its IT set-up cumbersome, and the company was incurring considerable expense in maintaining its IT infrastructure.

University Business School, Panjab University 11  35 vendors who had a textile and apparel solution were identified, including SAP, Oracle and Accenture.  SAP R/3 AFS was selected after a thorough evaluation of the functional fit of the product to Madura’s requirements.  Madura formed a project team comprising consultants from PricewaterhouseCoopers. Apart from this, a joint team was formed with SAP India. A 30-member core team of 15 consultants and an equal number of professionals from Madura was formed to oversee the implementation.  After each milestone we did a quality audit to avoid cost overruns. The audit was conducted by a representative from SAP Germany.  The implementation kicked off in August 2001, and it went live in July The modules that were implemented included production planning, materials management, sales and distribution, finance and control.

University Business School, Panjab University 12  In the process, the company has reduced its response time to both internal and external customers.  Order execution has increased from 75 percent to 92 percent, and lead-time from WO to FG has reduced from 22 days to 14. Similarly, dormancy (six-month- old-stock) has been cut from 4.23 percent to 3.65 percent, which means wastage has reduced.  Profitability assessment for each showroom, brand and customer can be done in the system.  efficient co-ordination between demand, supply and production in the company.  order fulfillment rates have increased, while stocks have been reduced to a minimum.