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Issue of May 2006 
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Business Intelligence

Bajaj Auto’s smart move

Faced with tough competition, Bajaj Auto deployed a BI solution

In the late 1990s, Bajaj Auto, the leading scooter manufacturer, faced a crisis. There was a shift from scooters to motorcycles. Urban youth as well as rural markets were patronising the motorcycles, effectively ignoring scooters.

It was a do-or-die situation for Bajaj. It had to quickly adapt to the evolving market or be rendered obsolete. This was when the company went in for major organisational overhaul and restructuring.

Project 110 Percent

In 2000, the company’s business objective was code-named Project 110 percent. The goal was to boost the company’s top-line by 100 percent and the bottom-line by 10 percent. Bajaj Auto aimed at reducing its purchasing cost while increasing retail sales, dealer profits and customer satisfaction. IT became an important element in the overall business strategy.

Since 2002, Bajaj Auto is using the mySAP enterprise suite, which includes ERP, customer relationship management, supply chain management, and product lifecycle management, and is based on a transaction-processing model. SAP-BIW (Business Warehouse) was added as an extension to the enterprise suite to provide BI functionality and to ensure tight integration between the transactions, the system and the BI.

Anil Khopkar, GM, MIS, Bajaj Auto, says that the reason for deploying the SAP BI solution was that SAP also builds and provides India-specific solutions. He states, “The BI deployment was required to meet corporate goals. Every individual had targets to meet. The BI initiative was necessary to monitor and measure target achievements. BI has enabled the organisation to move beyond streamlined business transactions and focus on performance management.”

The Correct Version

Even when the business set-up and processes are exceptionally good, the challenge faced by an organisation is to ensure that the data available is a single irrefutable version of the truth. The data placed in the BI solution must be able to reflect the actual business transaction and measure it against the actual performance.

If the data is unable to correlate the weekly or monthly business transactions or represent the business activities, then it loses the confidence of decision-makers. “Our main concern was to ensure that the data available on an annual, monthly and even daily basis should result in action-orientation on the frontline and facilitate overnight decisions.” recalls Khopkar.

The BI initiative provided the company with tremendous data visibility especially for retail market sales. It also improved quality control and cost structure.

The BI deployment is used to measure all business functions, goals and targets, including marketing top-line, market shares, customer satisfaction index and dealer performance index. The company also has a business scorecard model and a shareholder value system in place. Since there has been a single SAP system for many years, there is tight integration and no compatibility issues.

Khopkar believes that unless you can measure something in business by performance, its targets cannot be achieved. BI has facilitated achieving the company’s business objectives. The achievements are measured, monitored and made action-oriented.

In A Nutshell
  • The organisation: Bajaj Auto is an automotive manufacturer with 20 million vehicles on the road. Its network includes 15 regional offices, 14 warehouses, over 450 dealers, and 1,200-plus outlets across the country.
  • The need: A full-fledged BI system to monitor and measure performance at all levels, and that would offer insights which can be acted upon.
  • The solution: The company implemented SAP-BIW on account of its tight integration with the mySAP business suite.
  • The benefits: The manufacturer is now able to measure the performance of its day-to-day operations. The focus is on improving overall performance including production, manufacturing and marketing.
 
     
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