Kirloskar embraces SAP R/3 ERP system

PUNE: Pune-based Kirloskar Brothers Ltd. (KBL) has put an ERP system SAP R/3
in place for its marketing and distribution activities.

Chairman and managing director Sanjay Kirloskar said that he expected SAP R/3
to become the backbone of KBL's information and business processes by March
2002. "Today's Internet economy is more customer oriented. To plan,
establish and develop relations profitably, we are looking into the possibility
of employing fully integrated software solutions that cover the entire process
from initial contact through to implementation and service provision," he
explained.

KBL has restructured itself into three strategic business groups - industrial
pumps, project and engineered pumps, valves, machine tools, agriculture and
domestic pumps, printing and anti-corrosion products.

The SAP R/3 system gains significance because of the fact that KBL has bagged
its largest ever order worth Rs 444 crore from Sardar Sarovar Nigam against
stiff competition from Alsthom of France and Power Corporation of Russia.

The Sardar Sarovar order is to bring water to Saurashtra. The second largest
order comes from Nuclear Power Corporation (NPC), which is worth Rs 77 crore.
Both the orders may be executed within three years.

KBL has posted a growth of 12.1 per cent in net sales that went up to Rs
416.2 crore from Rs 371.3 crore in 1999-2000.

Kirloskar said that the company was now in the process of transition from
legacy systems into SAP R/3 system for various strategic business groups.
"We have over 100 users in the system at regional offices, marketing
offices in Pune, plants at Dewas, Shirwal and Kirloskarvadi who are accessing
the system through WAN- Wide Area Network. These users are also connected to the
system through our Intranet," he pointed out.

At KBL's regional offices, sales orders received from customers and dealers
are being created in the SAP R/3 system. The orders are processed through
existing system and delivered to the dispatch department for billing through the
SAP system.

The SAP R/3 system will provide improved information access and management
throughout the organization. "We will be able to provide improved customer
services by faster response to customers," Kirloskar said.

In a market with low growth rates and few new projects, KBL has evolved a
strategy to become a projects management company to harness its capabilities to
the fullest. To meet the technological requirements, the company has upgraded
the Hydraulic Research Center. The center equipped with computerized data
acquisition system, is upgraded for testing of pumps at duty conditions up to
4500 kW and discharge up to 13,800 Ips with closed circuit testing up to 500 kW.

Meanwhile, Kirloskar Silk Industries Ltd. (KSIL), a group company has
established an e-commerce compatible Internet site. The site has begun
attracting potential customers for pure silk products. The transaction security
feature of KSIL web-site will be beefed up this year further allowing increased
traffic of genuine net-customers.