Sundaram Clayton Migrates Existing ERP To SAP

by Amit Tripathi    Oct 13, 2004

TVS group’s Sundaram Clayton, a player in the automobile component market, has migrated from its existing ERP system to SAP. The reason? The company is striving to build a uniform system across all the businesses of its parent organization.

Speaking to CXOtoday, T.G. Dhandapani, CIO, Sundaram Clayton, explained, “We went live on SAP ERP on April 1st 2004. Since 2000 we had been using a different ERP. The latest decision to opt for a new ERP made more strategical sense, given the fact that our parent group, TVS Motors had already implemented SAP. We therefore decided to purchase the same to have a uniform application and analysis of business processes across the group.”

Speaking about the challenges encountered in the implementation process, Dhandapani said, “The migration from the earlier ERP to SAP along with other legacy systems was a challenge in itself. Moreover, since, the two distinct divisions of Sundaram Clayton, namely, dye casting and brakes have totally different manufacturing processes. Therefore rolling out a uniform application was a tough task. Even interfacing the modules on Just-In-Time (JIT), the Total Productive Maintenance (TPM) and others also posed substantial challenges.”

The enterprise has purchased 150 user licenses of SAP that interacts with an Oracle 9i database on HP-UX (Unix) servers with Windows 2003 at the desktop level. The migration and implementation was carried out by Caritor to all its four locations on a 256 Kbps leased line (for Hosur & Chennai) and 2 Mbps for its corporate office.

Among the major advantages that SAP provides, Dhandapani points out that the dealers and suppliers are now connected online through the SAP Business Connector. As a result, the suppliers can look at manufacturing schedules through the web and receive and respond to JIT calls. Secondly, the pull system in the new ERP, which is based on customer requirements, activates the production trigger that sets of the operation process. This in turn triggers the process for warehouse replenishment. As a facilitator for JIT manufacturing, the Evaluated Receipt Settlement (ERS) in SAP triggers bill settlement once a change is induced in the manufacturing process. The third major advantage according to Dhandapani is the digitization of the TPM process.

Dhandapani added, “We had allocated a budget of Rs. 4 crore for the complete initiative and we expect to achieve the return on investment (ROI) within 18 to 24 months.”

Apart from Sundaram Clayton, enterprises like Tata Teleservices, and MindTree Consulting have also recently migrated from their existing ERP solution to SAP. Elaborating on this new migration trend, Alan Sedghi, president and managing director, SAP India Sub-Continent, said, “With the existing momentum and the vibrancy in the Indian economy, organizations across verticals are finding themselves on a high growth path. Recognizing technology as one of the key business enablers, enterprises look for a technology platform that will help them manage their business as well as leverage these emerging opportunities.”

Dhandapani did not wish to disclose the name of the earlier ERP used by Sundaram Clayton.

Tags: ERP