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Seamless Connectivity: Increasing technology use to create a dynamic sales and distribution network

March 23, 2015
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In a globalised economy characterised by growing competition, changing customer expectations and increasing pressure on margins, a robust sales and distribution network has emerged as a key differentiator for organisations across industries to gain an advantage over competitors. Both large- and small-scale companies are leveraging telecom and IT for building a dynamic, flexible and scalable sales and distribution model.

Typically, the communication set-up for organisations with wide sales and distribution networks consists of a mix of wireline and wireless technologies. To meet basic communication requirements, companies across verticals like FMCG, automobiles and manufacturing use a mix of technologies like optical fibre networks, leaded lines, MPLS, Wi-Fi, VPNs, international private leased circuit technologies, integrated services for digital networks, digital subscriber lines, Ethernet, and very small aperture terminals (VSATs). These technologies help companies achieve seamless connectivity within and outside their operations. They also result in the reduction of operating costs through the realignment of goals and deliverables within the distribution chain, which comprises the company, wholesalers, retailers and end-consumers.

Besides using a core communication network for meeting their connectivity requirements, companies rely on distribution systems enabled by telecom and information and communication technologies. These include the GPS, optimum route system, automated distribution system and virtual organisation system. These systems help organisations collect and analyse vast amounts of data, including information on products and volumes; annual demands for each product using customer location, retailer location, existing warehouses, manufacturing facilities, and suppliers; warehousing costs like labour, inventory carrying charges and fixed costs; shipment sizes and frequencies for customer delivery; and order processing costs. Quick and timely access to data across functions helps sales and distribution divisions within a company make informed decisions for forecasting demand, revising price structures and altering batch sizes while maintaining transportation efficiency. All this helps companies shorten product life cycles, resulting in higher efficiency and lower costs.

The majority of companies have automated their sales and distribution processes after realising the advantages offered by such systems. Automated distribution systems provide companies access to the entire workflow, including the stock available at the warehouse, goods transported to retailers, and the number of goods delivered to customers. They also help sales heads counter the risk of stock pile-ups, stock outs, order pile-ups, etc.

Virtual organisation systems are gaining importance among companies that have a large geographical footprint. Such systems use networks to connect employees and resources with suppliers and customers for distributing products and services, overcoming any limitations presented by the physical location of the company or the consumer. Virtual organisation systems facilitate coordination between different branches or regional offices of a company as well as between various divisions of the company without necessitating physical linkages. Large organisations use such systems to connect teams like product design, assembly and manufacturing, logistics, and sales.

In addition to using various IT-enabled platforms to track the supply chain, companies are relying on sales intelligence solutions to strengthen their sales and distribution functions. The emergence of social media platforms like Facebook and Twitter has significantly changed the perception of consumers towards brands. In such a scenario, it becomes imperative for marketers to look at solutions that would help them gain quick insights into consumer behaviour and accordingly modify their sales strategy. Companies are increasingly relying on sales intelligence solutions to make accurate projections, assess the strengths and weaknesses of competitors, and anticipate changing consumer behaviour to adequately plan and change sales strategy. They are also doing so to ensure that their sales force is equipped with all the information and data that is required for responding adequately to queries posed by dealers and customers. Sales intelligence provides employees with analytical tools to decode the vast amount of information and data that is available. In today’s connected world, it has become imperative that sales professionals have access to the latest market data on the go. Sales intelligence solutions enable teams to carry out the narrow segmentation of consumers to provide more tailored solutions, profile potential customers, identify upselling opportunities, and set a benchmark sales performance against competitors.

With the constant evolution in technology, a large number of companies are supporting their sales and distribution functions by adopting emerging concepts such as cloud solutions. Organisations are increasingly taking up enterprise mobile applications on the public cloud as they prove to be economical. Many companies are also examining the option of developing their own private cloud, which requires investment in server software and hardware. A few organisations, however, are moving towards a hybrid cloud approach, which entails the use of the public cloud for testing and developing applications and the private cloud for hosting and securing company data.

Besides cloud solutions, companies are opting for enterprise application stores (EASs) in their bid to strengthen their sales and distribution networks. According to Gartner, 25 per cent of companies worldwide will have their own EASs by 2017. An EAS gives an organisation greater control over the IT applications being used by its workforce. Companies either source specific applications required by their workforce from established vendors or make significant investments in building in-house applications for their EASs. A large number of enterprises are developing device-agnostic applications for their sales and distribution teams, giving them easy access to relevant information and data even when they are in the field.

Going forward, with the fast changing technology landscape, companies will be expected to leverage cloud, mobility and analytics to streamline and reinforce their sales and distribution functions.

tele.net conducted a survey of various organisations with wide sales and distribution networks to assess their telecom requirements and solutions. The survey comprised the following questions:

  • What are the organisation’s key technology requirements?
  • What is the mix of service providers and vendors that is employed?
  • What are the biggest concerns with respect to telecom infrastructure?
  • What are some of the mobility and enterprise applications adopted by the organisation?
  • What kinds of network security tools are being used?
  • What kinds of redundancy tools are being used?
  • Which new product or service is the most relevant for the organisation?

Key technology requirements

The survey results indicate that organisations that have a large footprint and a strong sales and distribution network need a highly robust and scalable communication network. To aid this, the sales and distribution segments of these companies have witnessed the introduction of the latest technologies and enterprise applications.

A large number of players bank on a mix of technologies for meeting their internal and external communication requirements. The majority of them have established wide area networks (WANs) for achieving seamless connectivity, with some of the most popularly used technologies being leased line networks, integrated services digital networks (ISDNs), Ethernet, VSATs and IP-VPNs. For example, Videocon Mobiles uses an intranet-based communications infrastructure connected to the active directory system on Microsoft Exchange, which serves as a centralised database system for the company. The company’s mail server is also hosted on an intranet network. Meanwhile, Unique Infoways, which manufactures and distributes electronics goods, has set up a WAN for meeting its telecom requirements, which provides the company seamless and on-the-go connectivity at its headquarters, co-location sites and other offices.

Considering the fact that sales teams have to handle huge amounts of data on a daily, weekly and monthly basis, companies opt for ISDNs to provide faster connectivity and higher bandwidth. Ethernet, on the other hand, is an economical option for scaling up existing networks, depending on future requirements. Apart from these, the survey results show that VSATs are a popular medium of connectivity for FMCG companies and automobile companies, which typically have a large number of regional offices and a wide network of distributors and retailers. VSATs allow players to establish connectivity between the headquarters and the regional offices. The medium also facilitates easy migration from legacy systems and the addition of new network applications. Many companies are also opting for optical fibre and wireless solutions (primarily radio frequency) for achieving last mile connectivity.

Apart from the above, mobile and enterprise applications have also gained popularity over the years. The most widely used among them are VoIP, audio- and videoconferencing, webconferencing, mobile email and corporate intranet.

Service providers and vendors

For meeting connectivity requirements, companies with a wide sales and distribution network rely on multiple service providers and vendors like Bharat Sanchar Nigam Limited, Mahanagar Telephone Nigam Limited, Bharti Airtel, Reliance Communications, Vodafone India and Idea Cellular. They also seek high bandwidth services from service providers like Sify Technologies, Tikona Broadband and Tata Communications. The key players providing hardware and software products and solutions include Cisco, Juniper Networks, SAP AG, BlackBerry, Symantec and Check Point Software Technologies Limited.

Mobile applications

The survey shows that companies are increasingly adopting enterprise and mobility solutions for streamlining oper-ations and increasing efficiency across the entire value chain. The kind of solution employed depends on a company’s specialisation, area of operation, network footprint and employee strength. Such applications reduce communication and delivery times, and also aid in customer satisfaction and company growth.

Some popular mobility and enterprise applications include sales force automation, customer services management, order taking, real-time location tracking, mobile point of sale, barcode, stock inventory and business intelligence on mobile. Sales force automation provides the sales team and management with real-time information on company products, discount schemes and inventory. At the click of a mouse, the management can access information related to orders, sales and delivery, locations and field force. The application also helps the company and sales team exchange data while on the move and assists in the instant tracking of transactions made by the sales team.

Another widely deployed enterprise application is the distribution management system, which allows sales teams to raise invoices and trace payment collection. Organisations also use the customer relationship management (CRM) application with the aim of ensuring the speedy resolution of customer complaints and improving consumer experience. Using this, the sales force can access information related to existing and potential clients on hand-held devices, as well as the requests and complaints of new and existing customers. Companies can also track the real-time location of their sales force as well as the status of complaints and customer feedback through mobile devices. A further use of the CRM application is to generate invoices and print them at customer locations through mobile devices. Payment transactions and product delivery can also be tracked. Usha International Limited is among the companies using software applications like CRM, a vendor portal, business process management, a document management system, and SMS gateway tools.

Data centres

Data centres are key elements in the business and IT strategies of companies across industries. All the surveyed companies have established data centres for running their day-to-day operations and supporting key functions. These serve as a centralised repository for the storage, management and dissemination of data and are facilities for housing computer systems and auxiliary components like those related to telecommunication and storage. Hardware like servers, rack and storage area networks, and multilevel firewalls are stored here, apart from the centre being used for hosting a number of IT applications. For instance, as part of its communications infrastructure, Delhi Transco Limited has an in-house Tier III corporate data centre at its Delhi office, which hosts more than 30 operational servers on a 24x7 basis.

Network redundancy

Uninterrupted connectivity is a key priority for companies that have a large sales force across the country. To cope with disruptions, companies rely on ISDN links and dual networks as backup, with some even using two backup systems. To address downtime issues, companies at large set up an MPLS parallel to the VPN. In case one fails, the other takes over immediately.

Network security

There are multiple mediums used by companies to secure their networks, with the most widely used tools being firewalls, antivirus and anti-spam tools, and the gateway load balancer platform. A lot of companies also use multilayered internal access systems that prevent unauthorised users from accessing the network by alerting the concerned official via SMS if any such attempts are made. Thereafter, the official has to send another SMS to the system to block the intruder.

Issues and concerns

Technology obsolescence in a constantly evolving landscape is the biggest challenge facing organisations. Despite earmarking a considerable budget for upgrading their telecom and IT set-ups, companies find it difficult to keep pace with new developments. They also have to ensure that their personnel are well trained if the maximum benefits are to be derived from the technology being used.

Companies also face issues like downtime, latency and data theft with regard to their telecom networks. Moreover, those with strong sales and distribution networks are also dealing with challenges related to the integration of all telecom systems on a single platform, access to reliable and secure information across locations, and the lack of connectivity in certain areas. For instance, the main issues for Antec, Inc. one of the surveyed companies, are identifying an appropriate technology roadmap, keeping pace with technological advances and installing a user access network for each of its offices.

The way forward

These days, companies are increasingly introducing mobile devices at the workplace for their sales force and also considering the adoption of cloud computing. One of the biggest advantages of cloud computing is the flexibility it provides an organisation when it comes to granting its field force wider access to the firm’s telecom and IT resources. A lot of companies plan to make significant investments in cloud systems to extend their software applications to the workforce beyond the desktop and office location. Cloud ensures the efficient use of time and business resources while linking various stakeholders in the sales and distribution chain.

Apart from increasing cloud uptake, companies with large sales and distribution networks are increasingly realising the benefits offered by big data and are becoming inclined to leverage it for better decision-making. According to industry reports, big data is becoming a priority investment for chief investment officers (CIOs) who are deciding their IT budgets. CIOs are discovering that it helps the workforce go through vast amounts of data, and also assists in identifying changing consumer behaviour and developing new selling and distribution models. In sum, companies at large are well placed to adopt cutting-edge technology and telecom tools to upgrade their existing communications infrastructure and strengthen their sales and distribution networks.

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