With Internet, the costs incurred in communication will be marginalized

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We cannot deny the fact that China is the world's manufacturing hub, but stalwarts like Ceat have contributed to India's entry in the league of top manufacturing destinations. And like in all the other verticals, IT and communications are playing a significant role in manufacturing as well.

Tom Thomas, executive director, projects, Ceat is looking into the ICT setup of the organization. With as much as thirty-one years of experience in the tyre industry he has undertaken some daring tasks to make the flagship company of the $2 bn RPG group even stronger. Talking to VOICE&DATA, he shares his experiences and the major implementations within the organization. Excerpts

Tell us about the ICT infrastructure implemented at Ceat?
Ceat has been one of the pioneers to have had an IT and communications infrastructure in place way back in the 1970s. Since then, till as recent as last year, we have been using the MAMIS based system. We migrated to SAP then.

Tom Thomas, executive director, projects, Ceat

Our communications front, we is designed on the MPLS platform networking. We have also looked into and deployed the bandwidth enabler through which we can switch bandwidth depending on the business needs at that point of time. Different periods of a month see different data flow levels. Through the enabler we can step up/down the bandwidth.

Why did the company make a shift to a new infrastructure?
MAMIS was not giving us enough scalability and the service for it was not available. It was not very cost-effective, as we had to maintain an extra team to update and upgrade it. It also did not fall in parallel lines to our business needs.

What percent of your revenue goes to IT? How big is your team?
We spend around Rs 10 crore and also have a running cost of around Rs 3-4 crore on top of it. And this year we are making around Rs 2,800 crore.

We are just around twenty people in the core group. Only to look after IT and communications there are close to fourteen people, and others lend a hand when needed.

What are some of the ICT implementations that you are aiming at?
We are looking at strengthening our network over the MPLS platform. Another area of change is to put our mail server on MS Exchange throughout the country. We are also looking at optimization considering the Cluster Server technology. If one server is out of order it helps continuous workflow through the other one, thereby ensuring regular flow of work. Six months back, before putting the Cluster Server in place, there were major concerns. Apart from all this we are looking at first level production planning. At present, this is not coming to us from the SAP platform.

What are the other technical implementations that Ceat has invested in?
At Ceat we have just implemented the business intelligence module. This has increased the profitability of the company. Manufacturing scheduling is not getting into the process control part. We should have a different approach towards it and we are planning that in our coming projects.

What are your investment plans for the same?
We are at a new facility, so the ICT investment definitely would be shooting up quite a bit. We are looking at something between Rs 5 to 6 crore for the infrastructure. We will introduce new technologies like MES (Manufacturing Enterprise Solution). It would allow us to collect data from machines all over, be it utility or electronic functions. We will also have the new Factory Talk Integrator at the new facility. All this would get integrated with SAP.

How important is RFID and SaaS to the manufacturing industry?
In RFID we are looking towards product racing. But if you look at the cost-it comes across as an expensive implementation, and has not grown much in the tyre industry. Adapting the technology to the tyre industry is still a problem. But in 7-8 years from now, it would be a dominant technology.

SaaS also has not taken off. But how fool proof it is and its visibility to the customer and supplier is still not known. It may grow in the recent future, but the integrities have to be much more streamlined.

What new technolgoies are evolving in the manufacturing industry?
In the communications sphere there will be a lot happening. Things are going to be much more cost-effective. With the use of the Internet the costs incurred in communication will be marginalized.

On the IT side MES and SAP will take much of the space, but even SAP has quite a few shortfalls. SAP cannot handle the manufacturing processes completely. This is a place where we are seeing new technologies, especially in complex process which can be integrated with SAP. Complex processes are still in the developing stage and not many vendors are offering them at this point of time. Most of the times they are custom made. This is a big emerging field in the manufacturing segment.

What are the barriers to growth in the ICT segment?
In the current times, I personally feel that costs will be the biggest concern. Investment will be the biggest barrier to growth. Investments in ICT will have lesser priority in comparison with day-to-day business needs.

On the software front, industry-specific architecture would find more inroads. Applications like Complex Process Manufacturing would have more weightage than Single Process Manufacturing. In the coming times a lot of custom-based softwares would find visibility in the market which will address and cater to the needs very specific to the industry and processes. And top of this would be integration of the entire architecture with the supply chain to give perfect visibility to all the attributes.

Sunny Sen
sunnys@cybermedia.co.in