You Never Chicken Out With IT

With IT, fighting the bird flu virus may be a tad easier!

Rather than being a great crisis management tool, IT can

actually come in handy at pre-empting its spread, rushing vaccines on time,

saving thousands of chickens and huge investments. Panicky poultry businesses

better take technology seriously, like Suguna did.

Suguna Poultry Farm spread across eight states in the

country, took IT seriously for 12 years. The benefits were in terms of

productivity increase, greater and better networking, sustained business growth,

and now, peace of mind.

MD, B Soundararajan, remains as cool as cucumber, even as

culling operations pick up speed elsewhere and chicken rates crash. He has

substantial business interest in Maharashtra, India's first bird flu affected

state. According to industry sources 30% market share and a farm located just

120 km from ground zero are reasons enough for concern. But IT has, to an extent

at least, alleviated all fears.

Here's how: The company's Oracle ERP system captures

everything from production rates to mortality figures. Mortality includes

natural deaths and Suguna has a percentage for that-for every 1000 chicks, one

death per day is okay-anything beyond 0.1% is warning bells. This is then

captured as a separate report and communicated back to the corporate office

where scientists analyze the reasons for the deaths and therefore, priorities

are set. In case of medication or vaccination requirements, the consignment

reaches the destination the very next morning of receiving the report.

The enormity of the task can be appreciated when one

considers Suguna's geographical spread-its last farm in the south of the country

is located at Kanyakumari; the furthest is at Siliguri in West Bengal. It has

11,000 farmers, 100 plus production centers and 2000 customers. Mining data from

everywhere would have been a logistical nightmare without technology aid. As a

routine now, all data and reports land up at the corporate office in Coimbatore

every evening at 7. So if a vaccination program is to be carried out and has

been ignored by farmers, the system shoots off an alert.

Soundararajan's investment of over a decade has therefore

led to greater customer satisfaction and building of trust, key elements in any

business, particularly the poultry industry now, torn as it is between bird flu

worries, government charges and industry counter charges.

It is also heartening to see a first generation

businessman, with only a school level education, believing in IT as an integral

part of his business strategy and growth. Started in 1984, Suguna Poultry had a

turnover that exceeded Rs 813 crore in 2004-05.  In the first half of 2005-06,

Suguna had sales of Rs 508 crore-an increase of 41% growth over the

corresponding period previous year. It has aggressive targets still. “By 2010,

we should have 30,000 farmers, around 8,000 employees (it has 3,000 now), and

5,000 customers. Our turnover is likely to reach Rs. 3,000 cr,” the MD says.

IT, he hopes, will help him here; lend a hand in reaching

his business goals. So from a homegrown ERP, the company has now switched to an

Oracle application last year. It had chosen IBM to implement Oracle e-Business

Suite, the implementation being based on IBM POWER 5 servers that is expected to

support Suguna's growth plans by driving business efficiencies, improving

employee productivity, and managing its growth.

IBM Business Consulting Services is implementing Oracle

applications at nine divisions at Suguna across seven states in India. The

implementation is likely to become the first of its kind in the Indian poultry

farming sector. Involving Suguna's corporate office, seven regional offices and

74 branch offices, six grandparent poultry farms, 126 breeder farms, 35

hatcheries, 10,000 broiler farms, 30 feed mills, and five transportation

offices. Modules being implemented include ERP, advanced pricing, enterprise

asset management, self-service work request, incentive compensation, advanced

supply chain planning, and constraint based optimization. On completion, the

solution will support Suguna's entire integrated poultry business, from the

management of the poultry breeding process right up to the packaging and

marketing of the end product.

Managing its processes at an uptime of more than 99% is

necessary because Suguna's offices run 24/7. “During the day, the chicken

production happens. At night, dispatch functions take place. There is therefore

just too much dependability on IT,” Soundararajan tells. Technology provides him

with a good network, as his 100 plus locations are now connected with V-Sat or

leased line. His IT department maintains all records of his 11,000 farmers, and

a team of 18 manages the database. It is again not an easy task to monitor

manually because every week, the feed and the chicks have to be dispatched; and

medication schedules are to be managed.

The MD's expectations in terms of productivity benefits

have also frutified, as the company has now been able to classify the best and

poor performers. Production performances are easy to monitor and the customer

accounts are managed deftly-the credit checks, sales analysis etc.-on a

day-to-day basis. “My expectation was in terms of cost control too. IT is

helping us by not allowing any expenditure or production cost deviation,” he

says.

Technology as a great employee control tool has also been

realized by the company, which is currently hiring at a pace of 700 hands every

year. And with the right push from the top, more and more employees are

leveraging IT. Around a thousand of Suguna's 3,000 employees now access IT to

run operations smoothly. A CRM deployment is likely to happen soon to strengthen

customer relationships even more and Soundararajan has no reservations about

putting his money in the right places for future needs. That will include an

innovative blend of streamlined business processes and enhanced technology

infrastructure.

Goutam Das, Bangalore





goutamd@cybermedia.co.in