'B-class cities are showing positive trends towards EAS software'
the concluding part to the IS 2004 survey on investments in B-class cities,
Nagaraj L. Bhargava, director marketing and alliances, SAP India shares
his perspective on the business potential in these cities with Abhinav Singh
In the IMRB report one clear trend that stands out is,
enterprise application software (especially ERP) is among the top IT priorities
for businesses operating in the B-class cities. In your opinion what is the
business potential in B-class cities and where is the investment expected to
be maximum this fiscal?
We were the first vendor to focus on B-class cities in India, as early as 1998,
and have been doing healthy business in many such cities in the Enterprise Application
Software (EAS) space. Of our 500 odd customers, we have a substantial number
are in the B-class cities. The B-class cities are showing positive trends towards
adopting EAS software. There are number of factors driving this trendone,
businesses wants to achieve operational efficiency to increase time to market
because of heavy competition in India. Two, businesses are looking at the export
marketthis would need businesses to streamline their operations and supply
chain to compete in the global market, and bring faster products to market.
Three, companies are looking at increasing customer experience by tracking their
customer needs and post-sales support. Hence the investment in ERP and CRM will
be high in the current year.
What kind of companies (from B-class cities), opt for
enterprise application software?
Companies that are into discrete, process manufacturing and consumer business
invest in our enterprise class software. Besides this we have had customers
coming in from different industry segments leveraging the business of our software.
For example we have had companies like Hero Cycles, Munjal Shova and the Nahar
Group in the Chandigarh-Ludhiana belt. Then we have customers such as Sunflag
Iron and Steel in Nagpur, Crompton Greaves in Nashik, GTN Textiles in Kochi
and GKB Hi-Tech Lenses Ltd in Goa. They have leveraged, digested and benefited
from our software like many other companies in the B-class cities of India.
How many new installations are you expecting in the B&C
class cities in India in 2004? Which verticals in B&C class cities currently
hot in the market?
In 2003 we had 60 new installations about 30 to 40 percent of them came from
the B&C class cities, which directly suggests this market is realizing the
importance of having an enterprise application to expand and bring transparency
into its business.
It would be difficult to give an exact a number to installations we expect in
the B&C class cities in 2004, but going by the trend we hope to witness
a substantial increase our customer base in the B&C class.
In terms of verticals, textile is currently hot in the country and looks promising.
For instance business interest is coming from the Coimbatore and Ludhiana region
which is the industrial belt-both for automotive and textile.
What are the challenges you face while doing business
in B-class cities of India?
Many companies in the B-class cities exhibit lack of awareness with regard to
the business benefits, which they will derive out of our enterprise application
software. There are a lot of local software developers who have deployed their
software in many companies in the B-class cities. In many B-class cities, where
very few companies have adopted an enterprise class software, there is a lot
of hesitation on their part to go in for our product. However once the companies
in B-class cities decide to go in for our software then there is no looking
back and they go all out to leverage the benefits which our software package
has to offer.
Are there more ERP than SCM implementations in the B-class
Most of the companies in the B-class cities of India to begin with have gone
in for an ERP implementation, and have supplemented it with a SCM or a CRM implementation.
We have seen cases where companies have been using a customized ERP solution
and have freely jumped in from their software to our ERP solution.
What future growth is expected in enterprise application
software in the B-class cities of India?
We would continue to give thrust on expanding our customer base in the B-class
cities. However it needs to be seen that some of the companies in these B-class
cities are not confined to the SME segment. There are sophisticated companies
which are large in size doing world class work. Our endeavor would be to provide
different customized solutions to companies in B-class cities. We hope to increase
the number of local partners in these cities to expand our reach further.
Is there any special marketing strategy required to tap
the huge potential that lies in B-class cities?
We adopt different marketing methodologies to sell our software in the B-class
cities of India. Every year we do 10 to 15 city roadshows to showcase our solutions
to prospective customers. In the past we have gone to cities like Nashik, Kochi,
Chandigarh, Ludhiana, Indore, Vishakapatnam, Vadodara, Bhubaneswar, Lucknow,
Kanpur, Nagpur, and Goa. These roadshows have been instrumental in expanding
our customer base substantially in these cities. During some roadshows we invite
people from companies in these cities who have implemented our software to share
their success stories with them. This really helps instill the confidence level
of our prospective customers in these cities.
Secondly, we advertise extensively in some local newspapers of these cities
and send mailers to some of the prospective customers in the form of physical
letters. If a prospective customer shows interest our team goes and talks consistently
to them in order to get business in these cities. Besides our direct team we
also work with partners like HCL, Wipro and TCS who have a wide representation
in these cities. We also work with some local partners who help us in getting
business in B-class cities of India.
We heard a large turnout for your recently concluded SAP
Summit in Mumbai? Was there business interest or Request for Proposal (RFP)
from B&C class cities?
Yes there was big turnout of customers and prospective customers during the
SAP Summit wherein we saw a healthy participation from B&C class cities.
People had come from places such as Vishakapatnam and Coimbatore to attend our
summit and showed lot of business interest in our enterprise application solutions.