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Wednesday, Mar 03, 2004

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Elgi Equipments' thirst for tech upgradation

L.N. Revathy

Coimbatore , March 2

THE Coimbatore-based Elgi Equipments Ltd (EEL) has never shied away from adopting the latest technology. Its Managing Director, Dr Jairam Varadaraj, has always maintained that the company would rather invest in technology than spend huge sums in market development. And the company is doing just that.

Being one of the early adopters of the ERP (Enterprise Resource Planning) solutions in India, the automotive service station equipment and air compressor manufacturing major has not ceased to explore the business opportunities and integrate the various business processes.

EEL chose to go with SSA Global (then Baan) ERP solution and the project went live seven years back (in 1997). Six months later, it integrated and fine-tuned the data from all its branch offices. The company is now in the process of implementing product lifecycle management (PLM), a shop floor scheduler software.

In a recent interview to Business Line, the Vice-President (Organisation Development), Ms Arathi Varadaraj, said that the company had implemented the Scheduler software on a trial run in one division as it was very critical for EEL's operations. The smooth implementation has prompted the management to extend it to the other divisions as well. "We will probably be able to see the benefit of implementing the Scheduler within the next couple of months. We have three primary objectives for implementing this software - (1) to keep a tab on successful completion of the work order `on time', (2) in reducing the cycle time and (3) optimising the capacity and resource utilisation levels. The ERP does not consider capacity constraints, whereas the Scheduler software does," Ms Varadaraj explained.

She anticipates the manual intervention in the production process to be much more predictable with the Scheduler in place. "This would bring about a significant change in the overall efficiency levels," she said

"However, there will be one issue which will have to be sorted out after we implement Scheduler in all our divisions," Ms Varadaraj said and visualised a situation: "Say, if the shop floor is loaded for the next six months, the customer will get his order only after this period. In the present situation, we are unable to identify the overloaded production centre, as the ERP does not consider capacity constraints. This system will help in reducing the cycle time (from the release date to order execution date) by shifting the burden from an overloaded production to another centre, where capacity utilisation is not optimised," she explained.

She conceded that the ERP system that was in place did generate a number of reports, but that was not the end all for EEL.

Having established a stable system at the backend, EEL, she said was exploring the idea of looking at things based on various attributes. The company is currently doing a pilot implementation of Business Intelligence System, which would define attributes such as sales (regionwise, productwise, per sales person etc), vendor rating, accounts receivable etc. "At the end of the day, it is efficiency that matters," Ms Varadaraj stressed.

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