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'CIOs need to well represent the business needs'

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CIOL Bureau
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A very gentle disposition and an unpretentious ardor is the mark of this man,

who has been instrumental in scaling up Hero Honda to the scale of IT where it

stands today. This simple man has helped the largest two-wheeler company in the

world break new ground time and again, making a host of difference to the way

the automobile manufacturing world sees technology.

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SR Balasubramanian's association with Hero Honda has been a long one. His

first stint, which lasted only 2 years, began in 1990 (see personal diary). This

was the time for the big turnaround from the legacy systems and for positive

changes in the employee perception towards IT. But his second stint demanded

more changes and improvements. "When I came back, I found that nothing much

had moved at Hero Honda since I left. What I had put in 1991 as state of art had

become outdated by 1998," he says. We catch up with the man at the helm of

IT affairs at Hero Honda.

Could you tell us about Hero Honda's IT journey?

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I believe that for any radical change in business stewardship, top management

encouragement is a must. When I joined in 1998, Hero Honda depended on legacy
systems. And, the IT infrastructure was not able to support the expansion taking

place in the company.





We realized that a lack of standard integrated business process across the
company was one of the major problems. There was a lot of duplication of work

and redundancy of data/information that existed in the system. Implementing an

enterprise resource planning (ERP) solution with an integrated information

network was the obvious choice.


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The only major problem we faced was managing people's negative perception

of ERP. Most of the people were of the opinion that ERP implementation will
fail. Some of the senior officials in the company were also not comfortable with

the computerisation processes.


However, we managed to change the mindsets and IT has taken off very well,

especially with support from the management. There has also been very good user
support, which helped us in experimenting with new technologies.

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On your existing infrastructure in terms of application, communication



We have chosen SAP's ERP solution. The company went live with SAP solution on
February 2001. We had implemented all major modules including production,

materials, finance, marketing, assets, quality sales and distribution.

Siemens Information Systems was the implementation partner for this roll-out.

Besides, we have also implemented messaging and work flow management solution

from IBM LotusNotes.



The IT infrastructure of the company is connected over three major locations
through a hybrid network: corporate office in New Delhi with two manufacturing

plants (Gurgaon and Dharuhera), and other zonal and marketing offices.


Most of these locations are connected with the corporate office through a

Virtual Private Network (VPN) that consists of Local Area Networks (LANs) and a
Wide Area Network (WAN) using leased lines and VSAT (very small aperture

terminal) connectivity, radio links and dial ups.

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What are your future plans? Are you looking at implementing new applications

and solutions in the near future?


We continue to adopt and implement information technology (IT) systems. We are
currently implementing SAP's Suppliers Relationship System as a 'ramp up

site.' There are only 10 such sites (companies) worldwide that are currently

implementing this solution. Ramp up sites are those that SAP has chosen to

implement its new solution before the market release.



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In this case, SAP works very closely with the customers to provide all

required support in implementation. These sites are used as model sites for
reference to the potential customers.

We will be extending our supply chain in two stages. The first stage will be

self-service based for dealers and suppliers where each partner will be issued a

user ID and password. They will be able to access the information using their

IDs and passwords through an intranet site. The information will be updated

twice a day. In the second phase, MySAP will be connected to dealers and vendors

for transaction processing.

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Could you tell us about your budget plans?



Budget has never been a constraint. We examine every initiative from practical
point of view. We do not get enamoured by technology and focus only on

application of the technology in our business. We do not go overboard while

sizing our equipment but we certainly make sure that we order little extra so

that the IT systems never become a bottleneck in conducting business

What kind of ROI have you been able to achieve so far?



We refrained from working on return on investment (ROI). It is just an academic
exercise. Majority of savings come through processes and not from technology

alone. It entirely depends on willingness of the organization and end users also

play an important role. It was a company wide initiative.

Synchronization of operations was very much important to save cost and

improve efficiencies. There are no duplication of efforts anywhere in the

company anymore. It saved a lot of effort and in turn cost.

Your advise to new CIOs.



A CIO needs to understand the business of the company very well and should be
able to represent the business needs and concerns to the technology world.

He needs to assume the complete responsibility of driving the change in

business processes through technology and understand the domain specific needs.

Besides, CIOs will have to keep themselves abreast on new technologies and

application so that they can judge what is useful for their organization.

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