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Group 7 - IT

ERP

Management Issues in Implementing SAP @ Tata Motors


Prof. Oscar J DSouza

Group 7
Amol Mankar Sheetal Sabharwal Stafford Trinidade Sushant Kataria Triveni Aggarwal Tushar Malhotra
Group Assignment 1 Management issues in Implementing SAP @ Tata Motors 1

Group 7 - IT

ERP

Introduction
Tata Motors is Indias largest automobile company. Its revenue in 2005-2206 was Rs 24,000 crore (U.S.$ 6.4 billion).It is the leader in commercial vehicles in each segment and the second largest in the passenger vehicles market ,with winning products in compact, mid-size car and utility vehicle segment. The company is the worlds fifth largest medium and heavy commercial vehicle manufacturer and the worlds second-largest medium and heavy bus manufacturer. The companys 29,600 employees are guided by the vision to be best in the manner in which we operate, best in the products we deliver and best in our value system and ethics Established in 1945, Tata Motors presence extends across the length and breath of India. Over 3.5 million Tata vehicles have driven on Indian roads since the first one rolled out on 1954.The companys manufacturing base is spread across multiple plants, supported by a nationwide dealership, sales and services and spare parts network comprising of about 1,200 touch points. The company also has a strong auto finance operation, Tata Motors Finance for supporting customers in purchasing Tata Motors vehicles.

Background
Tata Motors (NYSE:TTM) is a key business of India's Tata Group, a $22 billion (in revenues) conglomerate with primary interests in steel, IT, commercial and passenger automotives, chemicals and telecom. The 140-year old Tata Group, feted by some as India's General Electric, is highly respected not just for its business prowess but also for its various social and educational projects that have contributed immensely to India's development.

Group Assignment 1 Management issues in Implementing SAP @ Tata Motors

Group 7 - IT

ERP

Its holding company, Tata Sons, is 65% owned by charitable trusts, which doled out over a billion rupees last year - and trusts in India are not tax avoiding schemes like in the U.S. Recently, the "Tata" brand was valued at $5.5 billion, and has mindshare with "trust" - a Tata product is considered reliable and a value for money, more than anything else. All group companies pay Tata Sons a fee for using the Tata name. The Tata Group's Chairman, Ratan N. Tata, is recognized as the leading Indian businessman of his generation. Taking over as chairman in 1991 during a time of tumultuous change in India's economic landscape, he undertook a bold restructuring and reorganization of the group, and is widely given credit for the group's transition and success post the economic reforms of 1991 that made the Indian business environment far more competitive. Ratan Tata has repeatedly spoken of targeting what University of Michigan professor, C.K. Prahalad, might call "the bottom of the pyramid" - in other words, the market opportunity offered by the vast and voiceless masses of India. TTM Managing Director Ravi Kant has vast experience in the Indian automotive market, and is a veteran of the company, the right man in the right place at the right time. TTM is key growth business for the Tatas, and currently contributes $4.6 billion or about 20% to the group's total revenue. It manufactured only heavy and light commercial vehicles, and its foray into passenger cars has been driven aggressively by Ratan Tata. Tata trucks dominate the Indian commercial vehicle landscape, having approximately 65% market for medium and heavy commercial vehicles (MCVs and HCVs), and 55%+ share for light commercial vehicles (LCVs). For passenger vehicles, the numbers are less impressive, with teething problems on some of its models (and stiff competition in the Indian passenger car market), such as the Tata Indica (compact car). TTM also offers the Tata Safari SUV and Tata Sumo MUV, and also has a presence in the mid-size car segment, with a slightly modified version of the Indica, called the Indigo. TTM's most ambitious project, the $2200 (Rs. 1 lac) car is due out by CY 2008, and is by far Tata's biggest push into the passenger car segment. There will be no competitor at this price point. The compact car will have a 30 BHP engine, and will seat 4-5 people. The target market is the "bottom of the pyramid" - or the lower middle-class to middle class Indian, who is looking to change to a car from a two-wheeler. With India's burgeoning middle class of over 300 million people, the car has a large market. Its customer is less in cities like Bombay and Calcutta, than the smaller towns and perhaps even villages of India, true to the chairman's vision.

Information Technology background


At Tata IT is seen as an important global function. Organizationally it is incorporated into the management services division. Mitras (CIO) task is primarily to provide each area with IT resources and tools required and to
Group Assignment 1 Management issues in Implementing SAP @ Tata Motors 3

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ERP

analyze whether Tata Motors should implement new technologies and IT solutions. He draws up a three year plan in close cooperation with management and Tata Technologies, a fully owned subsidiary of Tata Motors providing business and IT services. This plan determines the basic IT strategy. The details are finalized in an IT balanced scorecard in which the various projects are defined for the next 12 months and listed in order of priority. Joint teams from IT and business are then charged with executing these plans. In general, a distinction is drawn between project work and maintenance tasks. Tata Technologies is responsible for both. If required, external experts are consulted from relevant areas. Any differences of opinion about the long term perspectives of specific requirements are resolved together with the business team. Mitra sees himself as an arbitrator in this process. The focus is a balance between business benefits and the required corresponding investments. Currently the company has deployed a gigabit backbone network in its Engineering Research Centre and manufacturing plants. Key locations have a high level of redundancy for accessing business critical applications. WAN architecture is a mix of dedicated intercity / intra-city links, VSATs or VPN over service providers' network. LAN and WAN are monitored continuously with monitoring tools such as Cisco Works, Packeteer and other advanced tools.

Reasons For Implementation Of ERP


Tata Motors had its manufacturing plants located in Pune, Jamshedpur, Lucknow. Its R&D centers were located in South Korea, Spain and UK. The corporate office of Tata Motors was located in Mumbai. It had 1,400 in-house engineers and scientists. Its spare part dealer network consisted of 1200 touch points. It has 27 spare part warehouses comprising of over 700,000 unique materials. It has 17 levels of bill of materials. It has 42 regional and sales offices. Given its sheer size and its distributed units there was no online real time data available. To add to this inappropriate real time data led to production loss. The current legacy system was not integrated. The sales, finance and production planning systems were independent of each other hence information flow across the organization was very cumbersome. There existed a need for collaboration between vehicle manufacturers and dealers. Tata Motors use a manual dealer management system, where every dealer managed details. With legacy-based systems, the environment produced inconsistent data, making interpretations difficult and resulting in inefficient planning for capacity and spare parts. Tata motors wanted to scale production and increase its capacity, hence there had to be backward integration of the process. In order to cope up with this increased scale there had to be an improvement in productivity. Tata Motors saw implementation of ERP as a way of achieving these goals.
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Selection of SAP as the ERP package


In the automotive industry today, there is no shortage of challenges. Executives find themselves being pulled in many directions and struggling to do more with less. Stable or declining volumes in mature markets and increased competition from emerging economies are putting pressure on prices and margins, driving shorter product-development cycles, and making asset utilization a critical issue. Mean- while, the cost of everything from raw materials to warranties must be strictly controlled. And customers, of course, have ever-increasing expectations for quality, speed, and flexibility. At the same time, automotive companies face the growing complexity of managing an ecosystem of partners and their own farflung operations which can include both mature markets and areas that hold the promise of new customers and lower labor costs, such as central and eastern Europe, China, and southeast Asia. The resulting complexity is multiplied by a growing number of regulations, such as the TREAD Act, the EUs international material data sheet, and RoHS/WEEE re- quirements for monitoring environmental factors. In response to these challenges, leading automotive companies are pursuing innovative approaches and positioning themselves to thrive in a global industry. They are enabling cross-functional processes to take time and cost out of every aspect of their enterprise from engineering and production to payables, receivables, and purchasing. They are focusing on sales and service operations to strengthen their ability to provide a differentiating, high-quality customer experience. And they are implementing a range of adaptive approaches such as lean enterprise and Six Sigma to ensure that customer requirements drive engineering, manufacturing, and logistics processes. These innovations offer great potential to the industry. However, the challenge lies in approaching them systematically, enabling and supporting them in an integrated fashion. Too often, automotive companies are burdened with fragmented, disparate systems and manual, paper-based processes that create friction in external and internal value chains and lead to disconnects among automotive manufacturers (OEMs), automotive suppliers, and sales and service organizations. This disjointed approach makes it difficult to share information, develop an accurate view of demand, work closely with supply chain partners to understand and reach the customer, and, ultimately, turn innovative ideas into practical realities. SAP helps companies meet their business challenges and capitalize on new opportunities with the SAP for Automotive solution portfolio designed specifically for the automotive industry. Drawing on more than 30 years of working with automotive organizations, SAP enables companies to manage and integrate critical business processes and collaborate with partners across the value network. Today, more than 1,600 automotive companies worldwide rely on SAP solutions. SAP for Automotive supports the entire range of industry processes, including supply chain planning, manufacturing, logistics, sales and marketing, and
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customer service. It provides OEMs with support for everything from research and development to planning, manufacturing, and vehicle end-of-life considerations. It gives suppliers the tools they need to handle product development, quoting, manufacturing, procurement, and logistics processes. And it enables sales and service organizations to manage processes such as vehicle configuration, service-parts logistics, and warranty claims among many others. SAP for Automotive is designed to help automotive companies of virtually any size. In addition to providing the tools and capabilities needed to support fundamental enterprise processes such as finance, regulatory compliance, human capital management, and corporate services. SAP for Automotive solutionshelp companies perform the following activities: Drive adaptive manufacturing and procurement SAP for Automotive supports multiple manufacturing strategies, including repetitive, lean, flow, assemble-to- order, and forecast-driven processes. Companies can plan, execute, analyze, and control manufacturing operations in sequenced-build and just-in-time production environments. It enables them to leverage lean manufacturing and Six Sigma to improve efficiency while reducing the complexity of synchronizing the supply of automotive components and subcomponents. And companies can draw on information about planning, accounting, human resources, materials, warehouse operations, plant maintenance, and quality to keep production in tune with overall business requirements and customer demands. Perform model-option planning SAP for Automotive lets companies manage customized orders and closely align model mix with market demands. The portfolio offers fully integrated solutions for planning, pricing, configuration, order processing, availability checking, production, fulfillment, billing, and financial reporting, giving companies a consistent view of the product in sales orders, production plans, and profitability analyses. Manage the complete vehicle order-to-delivery process Manufacturers, dealers, and importers can collaborate on the full range of activities associated with selling and delivering vehicles. SAP for Automotive gives importers a powerful channel- based tool for procuring, selling, distributing, and tracking vehicles and service parts, while enabling dealers to easily configure, search for, obtain, and track vehicles for their customers. Manufacture and deliver components Suppliers in all tiers can use SAP for Automotive to ensure compliance with customer mandates for receipt of material releases; to synchronize production with demand; for data capture and error-proofing on the shop floor; for packaging, labeling, and shipping; and for generating advance-shipping notifications to maximize operational efficiency and effectiveness
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Handle warranty claims with efficiency and accuracy SAP solutions enable dealers, importers, OEMs, and suppliers to process warranty claims and automate the claims-payment process for increased efficiency. The software facilitates the processing of warranty claims across brands and handles multiple-warranty programs. Companies can use SAP software to examine and report on data from various sources and transform warranty information into additional product knowledge. They can analyze campaigns, components, dealerships, and vehicles to drive strategies based on an understanding of factors such as parts-failure and returned-parts patterns and participation levels for a given recall campaign. Streamline the service-parts process SAP for Automotive lets companies manage todays complex service-parts operations with powerful planning, fulfillment, and logistics tools. They can perform time-phased demand and replenishment planning while handling procurement, warehousing, distribution, and workload scheduling. And it gives them visibility into de- pendent and independent demand, parts inventory, supply, and customer and system fill levels. The service-parts management capability supports re- manufacturing, core management, and entitlement controls. Enhance dealership management The SAP Dealer Business Management solution part of the SAP for Automotive portfolio lets independent, group-owned, and OEM-owned dealers manage their entire business, even when working with multiple brands, franchises, and locations. Using the integrated set of solutions, vehicle retailers can manage everything from procurement of service parts and accessories to sales of new and used vehicle, as well as finance and marketing. SAP Dealer Business Management enables dealers to work seamlessly with their parent group or OEM to boost efficiency and meet customer needs. Collaborate across engineering and design SAP solutions provide tools for internal and external collaboration at every stage of engineering, including design and production start. The software supports collaborative product- development processes involving OEMs and suppliers, such as the Advanced Product Quality Planning (APQP) process and ISO/TS 16949, the globally accepted quality-management system that links customer satisfaction with the measurement and improvement of processes. Strengthen the management of programs and projects SAP solutions provide the tools companies need to plan, manage, and control programs and projects of any size; oversee project structures, timelines, costs, and resources; and optimize re- source allocation across programs and projects. Manage relationships with customers and partners

Group Assignment 1 Management issues in Implementing SAP @ Tata Motors

Group 7 - IT

ERP

SAP for Automotive gives companies the sophisticated customer relationship management tools needed to manage sales and service interactions with all partners in their value network, including dealers, OEM customers, partners, and suppliers. A comprehensive set of marketing, sales, and service tools integrated with vehicle and product data ensures that knowledge-driven interactions improve customer satisfaction and increase collaboration. Deploy enterprise shared services SAP for Automotive enables companies with diverse, geographically distributed operations to adopt and deploy back- office processes through shared-services centers. As a result, companies can leverage enterprise best practices and achieve savings from reduced redundancy and the centralization of transactional information about suppliers and customers Understand and control operations in greater depth Comprehensive tools for analytics, forecasting, and reporting help companies plan, budget, and optimize internal and external processes; improve sales planning and monitoring; and work with a complete picture of operations. Improve the management of enterprise assets Support for enterprise asset management covers the complete asset life cycle, including specification and design, development and procurement, operations, preventive and predictive maintenance, and disposal helping companies reduce operating costs and minimize downtime Ensure compliance with government regulations Comprehensive capabilities address the full range of reporting requirements, including the Sarbanes-Oxley Act; global trade and customs rules; and environment, health, and safety regulations. Companies can track detailed data about quality, materials, components, and products throughout the value chain.

Tata Motors Financials


A developing economy like India craves for financial resources. Often the traditional financial sector is not accessible to the customers at large, thereby creating a need for financial organizations catering to specific industries. The auto industry worldwide has often faced the problem of finding the right funding for its customers. These factors, along with the cyclical nature of the auto industry, has induced automobile companies to think of captive financing arms of the parent companies, which would exclusively fund the parent products and also act as a catalyst in certain areas for promoting the products. Tata Motorfinance (TMF), the auto financing arm for Tata Motors, came into existence in June 2003. This was a common front-end, jointly formed by BHPC (Bureau for Hire Purchase and Credit) of Tata Motors and the asset financing
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arm of Tata Finance. This company was a virtual entity, with both the divisions maintaining their legal identity, and was in the market for exclusively financing Tata Motors vehicles. Subsequently Tata Finance was merged with Tata Motors and in April 2005 TMF became a division of Tata Motors.
Net Sales
In Tens of Millions 25,000.00 20,000.00 15,000.00 10,000.00 5,000.00 0.00
19 97 19 98 19 99 20 00 20 01 20 02 20 03 20 04 20 05 20 06

Series1 Series2

Year

Critical Success Factors


Some of the CSFs that Tata Motors took into consideration while implementing mySAP are : Improved Sales Revenue Cost Reduction Reduced Inventory Improved Production Scheduling Improved Productivity Enhanced organization-wide communication

ERP Implementation Methodology

Group Assignment 1 Management issues in Implementing SAP @ Tata Motors

Group 7 - IT

ERP

SAP implementation at Tata Motors started in 1997 when SAP version 3.4 was implemented . It was upgraded to version 4.6 in 2003 and the integration is still going on with production planning and HR functions still to be completely integrated.Inventory cost has greatly reduced as real time info is available . Production bottleneck is reduced as scheduling is very good and Vendor end system has been integrated with VCM ( the legacy system) which is yet to be incorporated within SAP. Processes have been standardized across plants at various locations. Tata Motors followed a phased roll out approach.This implementation was to be one of the largest SAP Implementations in India.In other words it was one of the largest Integration Project in India with five Servers converged to single server. SAP Go-Live paved way forward for Business Transformation at Tata Motors and Information support for Business Excellence. Present Implementation lays foundation for implementation of SAP Industry Vertical Solution for Automobile Companies i.e. IS Auto , Supply Chain Management and Advance Planner and Optimizer. SAP Product Implementation at Tata Motors encompasses Functional and Technical Consulting for implementation of mySAP portfolio of products - SAP R/3 Implementations including Industry Specific Solutions - BIW, CRM, SRM, APO, SCM, Enterprise Portals Change Management SAP Implmentation Audit Identification of Risk Factors Risk mitigation Planning Solution / System Optimization System Operations Plan

ERP Implementation Process


mySAP SRM 40 Implementation at Tata Motors has been christened as Project VECTOR:Value Enhancement by Collaboration through Technology and Operational Restructuring Project VECTOR Mission Revolutionize the supply chain by uncovering the hidden value through technology driven Sourcing and collaborative Purchasing The ultimate goal of project vector is stated in bullet points below: Bring global Spend visibility to maximize negotiation power Enhance Supplier capability through catalogue content management Supplier evaluation to support Supplier rationalization Parts rationalization through spend analysis Competitive price through live auctions
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Streamline procurement process across locations Automate procurement process Quick sourcing through live auctions Centralized sourcing and decentralize procurement Bring in an Organization change Empower buyers, remove non value added processes Drastic reduction in follow up efforts through supplier collaboration Clear visibility of supplies and payments status to suppliers through portal. Harness state of the art technology Netweaver,Web enabled collaboration

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Project Scope
Phase 1 Pilot implementation covering: four locations for selected product categories and four vendors each for direct and indirect materials. Phase 2 Rollout of mySAP for Direct and Indirect Materials for balance Product Categories and Vendors covering all locations. Also implement Service Procurement, Confirmation, Invoice entry and Approval Modules. Phase 1 of mySAP implementation was primed by SAP Consulting. Phase 2 was primed by Tata Technologies Limited 1997 : SAP version 3.4 was implemented Constrained by the WAN architecture in the country their first implementation was a decentralized one. They had four servers: 3 for their manufacturing plants at Jamshedpur, Lucknow and Pune 1 for their sales and corporate services at Mumbai. 2003 : upgraded to version 4.6 migrated to single server architecture Triggered by need to consolidate operations at Daewoo,Korea and the Pune operations. 3000 users, and the company implemented over twenty modules of SAP. The range of SAP functionality used is perhaps one of the largest and successful in the automobile industry worldwide Disaster Recovery infrastructure to blend with ERP System Seamless integration with Enterprise Applications like PLM and CRM Customization: Enhanced automatic Invoice Verification: 12000 invoices a day Automated payment and recoveries for transporters: 4,50,000 vehicles annually Participants: Suppliers, Dealers, Sales & Service Centers and even Bankers The entire SAP implementation process is headed by the Steering committee thats includes the CEO,CIO and functional heads.
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SAPs Commitment to the Project


SAP and Tata Group is a growing partnership.Since Tata Motors a key Auto player in Indian Market,the success of the current Implementation project is key to SAP to ensure dominance in SRM segment.As a part of commitment SAP has agreed to Lead manage the Implementation project, Involve its Top Management in project monitoring Involve Expertise in the region and Ensure adequate knowledge transfer to the TML / TTIL team for self sustenance after they go-live. The various SAP modules that have been implemented so far are: Materials Management Sales and Distribution Production Planning Quality Management Finance and Controlling Plant Maintenance Project Systems Asset Management External Service Management Real Estate Human Resources Warehouse Management

Tata Motors Project: Overview


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Tata Motors has been the first Customer to Implement and Use all Scenarios of SRM.These comprise of the following: Self Service procurement. Catalog and Content Management. Strategic Purchasing Scenario: Spend Analysis, Contract Monitoring. Sourcing Scenario: Rfq, Rfx. Supplier Self Registration Module. Live Auction Cockpit Order Collaboration Scenario with full support for Goods Movement. Contract Re-Negotiation Scenario for Retrospective Price Amendments. Usage of SAP Netweaver: People Integration, Process Integration and Information Integration The following componets were used: SRM 40 with EBP 50, Bidding Engine 30, Live Auction Cockpit 20, Supplier Self Service 30, Catalog and Content Management 10 SAP Netweaver 2004 with Exchange Infrastructure 3.0, Enterprise Portal 6.0, Business Information Warehouse 3.5 and WAS 640 for LAC.

Benefits Accrued
SRM Supplier Collaboration
for Closed Loop Procurement Process
Feature

SUS Supplier self Service


PO / SA new and amendments Delivery schedule ASN creation at supplier Excise Invoice capture E mail and chat Bulletin board

Business Benifit Provides suppliers with a streamlined order management system, along with a friendly interface and comprehensive search options make the job easy. Reduce latency Reduce manual efforts of excise invoice capture. Efficient Goods Movement Tracking. Reduce efforts in short listing vendors for sourcing a part. Easy capturing of new vendors capability. Easy accessibility for all buyers

Suppliers Registration and Information Repository

SRM Operational Procurement


for Cost Reduction, Better Spend Control & Contract Compliance
Feature

EBP Enterprise Buyer Professional

Business benefit Compress cycle time Reduce transaction cost


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Group Assignment 1 Management issues in Implementing SAP @ Tata Motors

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ERP

New part development


Interface with Denis Shopping cart creation. Create Contract or PO in R/3 Bid approval Invitation and processing till Create contract or PO

CCM Catalogue Content Management


Users can buy directly from source based on prices fixed by empowered person May be used for production resources and MRO items

Electronic data storage - Quick retrieval. Tracking of development items status Time saved for review. Integrated Procurement Process with Backend R/3 MM. Ease of procurement Reduce inventories Reduce cycle time Reduce storage.

SRM Strategic Sourcing


for Improved Supplier Selection, Reduced Cycle Time Feature Business benefit Closed Loop Sourcing Cycle. Bidding Engine Category based Sourcing Cockpit gives Supplier rationalization and more control and ease of use for prequalification buyers. Supplier selection efficiency Data Integration between Requirement, Automated Contract creation or Sourcing and Fulfillment Process Change avoids manual data entry and increases efficiency. Online Bid Submission Reduces Cycle Time and reduces cost for suppliers. Online Bid Evaluation Analytics for Improved Supplier Selection. Integrated Contract Management Specifically developed for TML Maker / checker facility in real sense. Price change of existing contract from Improve data accuracy bid invitation to approval and amendment

SRM Live Auction Cockpit


for Better Savings and ROI through Supplier Competition Feature Business benefit In line with existing LAC engine of Ariba LAC Live Auction Cockpit with added benefit of Integrated Procurement Process that Streamlines the process flow through seamless top-to-bottom integration with multiple SRM components and backend systems. Self hosted engine reduce
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dependence on external service provider. Integrated to Procurement Process Reduces Manual Data entry. Electronic Workflow Approval Process that increases efficiency

SAP Netweaver :
Central Platform for Electronic Commerce Feature Business benefit Easy Navigation to all systems thus Enterprise Portal Single sign enabling Seamless Integration to on. different Applications and Processes. Rolebased and provides unified, secure access to supplier related information, transactions and services based on authorizations associated with a particular role E-learning which is quite convenient KM Knowledge Management and faster Knowledge sharing Repository of all training material FAQs Centralized Process Integration Model. Exchange Infrastructure Can be used in future for Non-SAP Integration and for B2B Communication

SRM Analytics
Proactive Monitoring and Control Feature

BW Business Information Warehouse - Analytical reports


Spend analysis Vendor Evaluation SOB Vendor database Bid comparison Shopping cart tracking Rejections Masop material supplies and balance GR status and Payment details

Business benefit Operation support Decision support Strategy development support

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Overall Integration of the departments Finance, Sales, Production etc. On Demand Decision making data Backward Demand Integration Reduction in inventory cost as real time info is available Reduction in production bottleneck with better scheduling Seamless integration across the Supply Chain Standardization of processes across plants at various locations Reduction in manual efforts of Invoice Capture Reduction in Transaction Cost & Compress Cycle time

Tata Motors took the first important step toward a modern IT landscape in 1998 by implementing SAP R/3 for the basic business processes, following an internal reengineering project. Implementing SAP helped the various sites improve automation and created a basis for integrated processes. Although the effects of the implementation were noticeable, they were not farreaching. Improvements - such as a more efficient way to access information or a more precisely defined workflow - could not be felt at the transaction level. Because of the required process volume, Tata Motors had to make a number of changes to the systems to meet performance requirements. With up to 15,000
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goods receipt notes per day, you can imagine the kind of data volume were talking about, says Mitra. If system performance is bad, thats a problem. Everyone learned a great deal. For internal reasons, Tata Motors had to take a decentralized approach . After SAP R/3 4.6C was implemented in 2003 and enterprise resource planning was founded on a single server for the enterprise, the company profited from significant advantages, particularly for financials, logistics, and sales. Five systems were consolidated on one server with one database and the company stayed as close to the standard version as possible. Both the business as a whole and developers are now much more involved. Since the implementation, the IT division of Tata Motors has been run according to the principle of controlled programming. Wide range of improvements results from a combination of centralized data retention and higher-quality software. Improvements have been identified in general costs, purchasing, resource planning, logistics, and the process for providing important financial information (such as for Sarbanes-Oxley compliance). Processes have been tightened, and synergies found on all levels. Production locations are finally able to see the data of other factories. Users are also more disciplined and receptive to rationalized processes across the manufacturing plants. Over 3,000 Tata Motors users now work with SAP solutions. In the automotive industry worldwide, Tata Motors claims to have the widest range of SAP functionality of any SAP installation. With the exception of product life-cycle management and customer relationship management, the company uses, or plans to use, SAP applications for all typical IT applications in its business portfolio. The introduction of SAP Advanced Planning & Optimization (SAP APO) will be essential in improving supply chain management. Mitra plans to have Tata Motors upgrade to SAP R/3 Enterprise this year. An ever-increasing number of business requirements will have to be incorporated into the system. More industry-specific best practices, he adds, will put the company in a better position to face coming challenges and support the CIO in his decision-making process. Mitra hopes that SAP will play a significant role in this project. All in all, the SAP infrastructure provides a strong IT infrastructure to support Tata Motors aggressive globalization plans. We are well prepared for the challenges ahead, says Mitra.. The pressure on companies is not easing. Those that can only react in their own markets will soon be left in their competitors dust.

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References

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