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Being in midst of business expansion, segregated business processes were posing a challenge for Avon Cycles. To solve this dilemma it deployed SAP Business All-in-One. By Jasmine Desai
It was in the wake of expansion that Punjab-based Avon Cycles, India’s largest bicycle exporter supplying the global market with a turnover of $89.4 million, decided to opt for SAP Business All-in-One. Avon’s growth had occurred despite a visible lack of integration in its business processes. It was time for the company to integrate these processes by deploying an ERP solution.
Making the leap
Kuljeet Sethi, Chief Information Officer, Avon Cycles, commented, “We were sure that the business processes would be affected by this deployment.” The company had to eliminate existing systems that operated independently. It had to facilitate information sharing and decision making through improved data. It was also necessary to introduce an integrated information system to capture all key processes and to keep pace with changing business needs with a reliable and robust IT framework.
Avon Cycles evaluated vendors based on criteria that the ERP system had to be flexible enough to adapt to the demanding production needs. The bicycle industry has to cater to the constantly changing requirements of end users with variations that include type of model, geography-wise features, seasonal changes etc. “SAP was chosen because it gives us the capability to customize it as per our requirement while keeping the integration fabric intact,” said Sethi.
SAP’s partner, Vcentric Technologies, collaborated on the implementation. The project was mapped according to SAP Best Practices packages that are localized for the Indian business environment. Avon’s core project team consisted of functional users; department heads formed an owners’ team to oversee progress. Twice-weekly reviews were conducted with full management support guided by the Vcentric Technologies team. This structure ensured that all functional change requirements would be met, along with the needs of end users, as each business process was integrated.
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Sethi added, “The implementation process was rapid as defined by SAP and we were the first in the region to implement this software through Solution Manager—SAP’s project management tool.” The hardware systems are IBM p Series in cluster mode, SAN storage and a tape library for automated backup. The operating system is AIX and the database is Oracle 10g. The SAP implementation has been done at Avon’s data center located in Ludhiana.
Any implementation requires a certain amount of change management. At Avon, there were two aspects to this. There had to be changes in the requirements. The business processes also had to change. Sethi elaborated, “While the first aspect was handled with proper documentation and approval systems, the second was addressed by conducting training for the core team members who, in turn, gave necessary training to end users.”
Benefits galore with plans ahead
Post-implementation, 75 users responsible for business processes in 10 functional areas were given access. A greatly improved system of material tracking empowered staff across the stores, production and sales departments. Avon quickly realized a return on investment. Sales improved as employees could now service the market more effectively within shorter time frames. Costing became more accurate and the contributions of individual products were more tightly assessed. Numerous manual processes were eliminated, as was duplication of many time consuming functions.
A measurable improvement emerged in the complete cycle from procurement to customer account settlement. Equally important for the big financial picture was the fact that Avon Cycles no longer carried the risk inherent in outdated, poorly supported systems.
In spite of such a smooth transition, the implementation would still not be the same if Avon had to do it again. As Sethi put it, “If we were to do the implementation again, we will rethink on the configurable finished goods configuration to meet all of our requirements.” After implementing SAP Business All-in-One the company was planning to go ahead with the implementation of workflows, Adobe Forms, Business Intelligence (BI) and Supplier Relation Management (SRM). It has already implemented workflows, Adobe forms, and BI. Going forward, it has plans to implement SRM.
Sethi summed up, “We not only have the technology to extract critical information more rapidly and more reliably, we also have a team that embraces the software for the possibilities that it creates.”
Looking ahead, Avon will build on this success and the solution’s capacity for further integration, such as adding the supply chain management functionality of the SAP Advanced Planning & Optimization component.
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