Soaps wanted to extract more value out of the well-formatted
ERP data it had collected over the years. It implemented data
warehousing and OLAP tools and applications to mine additional
benefits and also paved the path for future e-commerce initiatives.
by Soutiman Das Gupta
the creation of this 'warehouse of possibilities' the company
now can perform a number of contribution analyses, profit
and loss analyses, and sales breakup analyses
1995 Godrej Soaps (now GCPLGodrej Consumer Products
Limited) decided to implement MFG/PRO an ERP package from
QAD Inc. Since its complete roll-out, the company has experienced
numerous benefits. Inventory levels have reduced, workflow
processes are standardized, business processes are more disciplined,
manpower is better planned, and product cost information can
be viewed instantly.
Along with standardized workflow and disciplined business
processes came data in a more or less consistent format. And
this invaluable data was lying idle unless required for an
ERP query or statistic. "We then decided to implement
data warehousing applications and functions to help us extract
the most out of the critical data", said Mani B. Mulki,
General Manager, Information Systems, Godrej Industries Limited
With the creation of this 'warehouse of possibilities' the
company now can perform a number of contribution analyses,
profit and loss analyses, and sales breakup analyses. These
can help enhance product lines, build greater customization,
and favorably impact the bottom line. This combination of
ERP and data warehousing applications has also paved a future
path for GCPL's B2B initiative.
ERPA way of life
When Godrej Soaps decided to implement an ERP to manage its
operations better, it invited Andersen Consulting (now Accenture)
to guide it through the ERP selection and implementation process.
"Together we evaluated SAP, Oracle Financials, and MFG/PRO.
The decision to use MFG/PRO depended on factors like cost,
installed base in India, and the amount of technical support
available. And since Hindustan Lever Limited had already successfully
implemented MFG/PRO we took a cue from it", informed
The entire ERP roll-out in 120 Godrej group companies and
locations was complete in 25 months. The company received
various tangible and intangible benefits from the ERP. There
was substantial reduction in inventory, improvement in customer
service levels, cost tracking was performed online, and workflow
processes were disciplined.
GCPL's employees depend on the ERP for their daily operations.
"The employees have got used to the disciplined workflow
which they are compelled to follow in each department. Using
the ERP system is like a large standardization exercise. Vital
data is collected and collated and used to the company's benefit.
This has increased our dependence on ERP to a level where
we feel that it is vital to us like air and water. It's now
a way of life for us", declared Mani.
Since there's a lot of formatted standardized data in the
system, it makes good business sense to use it to the company's
benefit. "The large amount of data was virtually jailed,
and could have many potential productive uses", said
Mani. GCPL decided to use data warehousing tools from Oracle
to accomplish the task. The range of data warehousing products
includes Oracle Express Server and the OLAP (OnLine Analytical
Processing) client. The system serves as a decision support
platform based on historical sales and cost pattern analysis.
An RDBMS from Progress Software was implemented at the backend
to support the ERP functionality. The company evaluated Oracle
as well as Progress and settled on Progress because it was
a more robust solution at that time.
The ERP and warehousing applications are not linked online.
Data is extracted from the ERP system with the help of extract
routines and uploaded into an Oracle warehouse with the help
of upload routines once at the end of every month. This creates
a separate undisturbed database in the warehouse. This data
is now routinely processed for a few days and results derived
The OLAP draws from the collected database and performs analysis,
calculation, and recalculation to support what-if scenarios
and other strategy-setting aides. The Express Server uses
a caching scheme to store, manage, and analyze relational
Data warehousing implementation in GCPL is nearing completion.
Data warehousing tools are not used for creating operational
reports. It is mostly used for analysis and trends that allow
the company to create short- and long-term strategies and
business problem solutions.
To explain this let us look at an example. A particular product
is manufactured in different factories of the company at different
locations. Ordinary reports will give you the amount of sales
that the product has made (product-wise contribution) and
the amount of profit that a particular customer has generated
for the company (customer-wise contribution). With data warehousing
applications you can calculate the profit contribution of
each factory for the same product and compare the efficiency
of different factories. As a result you can perhaps divert
more production activity to the better performing factory.
can view interesting trends in sales and costs. And if you
like, you can integrate the findings from standard reports
and the warehouse analyses to create strategic advances. The
limit of the capabilities of a warehouse is bound by the creativity
of the end-user", said Mani.
The company can load data like sales figures of goods from
the factory to the distributors (primary sales), from distributors
to retailers (secondary sales), and from retailers to end-users
into a common database in the warehouse. The data warehouse
can now allow you to derive sales and inventory trends.
Suppose primary sales have increased over a period of time
and secondary sales have decreased. This can lead to 'dumping'
or excess inventory. The trend analysis can thus help avoid
a situation like this and maintain a consistent flow of inventory.
can't just launch and immediately commission a data warehouse
tool in an enterprise. You need to have a mature group of
users who understand and appreciate the value of such tools.
The habit has to be cultivated. ERP can be forcefully injected
into a system and you cannot survive without it today. But
data warehousing cannot be injected by force. It has to be
accompanied with a lot of education to the end user. A user
should have the capability to extract useful business intelligence
from the warehouse. Thankfully, the personnel in my company
are very IT-savy and have been able to embrace the warehouse
initiative rather well", said Mani.
The company had started the warehouse implementation around
three years ago. Its usage has recently picked up and may
emerge as a driving factor for business in the near future.
There are plans to allow access to the warehouse on the Web.
July 2001 the management at Godrej decided to implement an
e-commerce solution to manage the supply chain better and
an e-CRM package to foster better ties with its distributors.
A detailed RFP (Request For Proposal) was made which clearly
stated the business needs. After going though a long list
of vendors and consultants, Godrej selected BroadVision as
the provider and Satyam Infoway as the implementer.
With this initiative, GCPL expects to perform better collaborative
planning and replenishment with its distributors. By doing
this, the inventory can become more efficient at the distributors
will set up inventory norms for all the products at the distributor
level and our systems will interact
with systems at the distributor's end. We can extract figures
like the closing stock and factory dispatch volumes. The system
can make suggestions like the amount of inventory to order
next week and the minimum inventory to maintain. The current
level of inventory is between 40 to 45 days at the distributor
level. In the first phase of e-commerce implementation, we
hope to bring the level down by at least 50 percent,
The company will also implement an e-CRM package from BroadVision.
It includes BroadVision One-To-One Enterprise, and its related
modules like retail and finance.
The idea is to provide distributors/customers a large number
of value added services over the Web. This will motivate the
customer to stick to the company's services and not switch
The customer can be proactively provided information regarding
dispatch and quality of goods. He/she can key in complaints
and suggestions. And based on purchasing history, the company
can forecast orders, offer replacements in case of non-availability,
cross sell, and up sell.
Consumer Products Limited
Godrej Soaps Ltd (now Godrej Consumer Products Limited)
is the flagship company of the Mumbai-based Godrej Group.
The company manufactures consumer products like soaps,
detergents, and hair care solutions. The group has 18
factories and 120 locations all over India.
A lot of ERP data in a standardized format was lying
idle in the company's servers. It would be a good idea
to use the data for other intelligent applications that
can enhance business productivity.
The company decided to implement data warehousing applications
and functions to help extract maximum usefulness from
the data. A range of tools from Oracle were used to
make this possible.
The company now can perform a number of contribution
analyses, profit and loss analyses, and sales breakup
analyses from the data in the warehouse. The applications
have also paved way for future e-commerce initiatives.
SAP, MFG/PRO does not demand a centralized database. SAP's
centralized database architecture demands that all sites need
to be online all the time with VSATs or any terrestrial link.
MFG/PRO gives you the option to maintain separate databases
at each location and centralize them periodically, said
But in order to offer e-commerce solutions the data needs
to be online and available on a real-time basis.
have started a parallel process of centralizing the distributed
databases. Soon we will have a monolith MFG/PRO central database.
All the different locations will handshake two or three times
a day with this centralized database and allow relevant data
to be extracted and uploaded. The e-commerce applications
can now talk to the centralized database. When this operation
becomes regular, in the next three years, we will go completely
online. We can then do away with the separate databases at
each location. And users will log in to a single centralized
database", explained Mani.
The 120 sites of Godrej companies are linked through VSAT.
Leased lines and dial-ups function as backup links. Regional
offices and factories use HP Unix servers and the ERP runs
on Windows-based servers. The company uses Satyam Infoway
for its IDC (Internet Data Center) needs. It will use the
services of Reliance Infotech's IDC for the BroadVision and
database centralization processes and plans to host seven
new servers for the initiative.
GCPL is also likely to use enterprise storage systems in the
The CRM initiative will go live in April 2002 and will cost
around one and a half crore rupees. The data warehousing suite
of products cost around 10 lakh rupees. And the ERP package
for four associate Godrej companies cost 13 crore rupees.
This includes consultancy fee, hardware costs, and implementation
costs. This amount was spent over a period of four years.
There were no technology hurdles in implementing the system.
The real hurdle was to change the cultural mindset of the
users. Users had to be trained and motivated to use the solutions
till they realized its actual benefits. And now the benefits
are showing and the people are happy. A good approach
is to make IT projects more driven by users than IT Heads",
Das Gupta can be reached at email@example.com