Kerala-based Synthite Industries, a leading spice ingredient provider, which has a turnover of over $125 million and commands over 30 per cent of the global market share, faced a unique challenge. Though the company had started its computerisation programme in 1987 and had upgraded its systems in 2000, the firm's rapid expansion led to disparate information technology (IT) systems.
“The biggest challenge was we did not have a single view of raw material we were procuring and orders we were getting. This meant the team responsible for planning could not plan ahead of time. This had an impact on profitability,” said Director Aju Jacob.
Synthite executives wanted to increase business control by examining operational and product data and understanding the impacts of financial, product and business decisions. This included establishing end-to-end traceability at any level for product batches, from raw materials to finished goods and scrutinising slow-moving goods against sales and inventory.
Since the company, with the help of IBM, has moved on to a systems, applications and products (SAP) environment, it not only gets a single view of all operations, its inventory management has also improved. “This has also led to better customer services. Our time to delivery has come down to 10 days from three weeks earlier,” said Jacob. He adds within a year of its adopting new IT systems, the company saw 15 per cent growth in volume in 2010-11.
Going ahead, the company is increasing investment in IT. Other than appointing a dedicated information officer, Synthite executives are also looking at analytical tools. “So far, we have data that helps us get the financial details, and understand how the business is performing. But now, we want the sales team to be able to predict things like the consumption level patterns and the product mix,” said Jacob.
IT implementation in any industry segment has been driven either by strict regulatory requirements, or by the need to expand faster. In the case of India's spice industry, both these reasons, together with the diverse nature of spices and the need to follow rigorous quality control, resulted in the industry adopting IT.
