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On-the-go-telecom: Tools for multi location enterprises

February 25, 2011
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Enterprises in verticals such as manufacturing, retail, travel and hospitality typically have a wide network with operations across the country at multiple locations. In these segments, ensuring efficient and seamless functioning of the task force across various locations is not always easy. For such large enterprises, even the simplest usable network is a complicated arrangement, while the most elaborate and sophisticated networks have multiple layers of replicated and interlocking functionality. A common challenge faced by all such enterprises has been the need to make the distributed organisation efficient and effective in its use of the networks that keep it connected.

While moving away from islands of information to distributed environments, such companies encounter bottlenecks in applications and data access at remote locations or branch offices. As organisations grow, they need to get closer to their customers, suppliers and partners by opening offices in smaller cities and sometimes even semi-rural locations. Therefore, for the sales and distribution of multi-location enterprises, the dependence on  telecom has been increasing as companies move towards large data usage to support core business processes.

Originally, these companies used telecom for limited business purposes only. For instance, basic applications such as COBOL, Fox Pro and inventory accounting system were popular. However, a serious limitation of such mediums was that the transmission of data had to be done manually, which was time consuming.

Over the past 10 years, however, these companies have been increasingly investing in robust and flexible communication networks. The idea was to increase operating efficiencies, leading to better customer service, lower costs and higher profits.

Today, companies are deploying cutting-edge technologies to improve supply chain management and information availability across the organisation. For example, for their wide area network, technologies such as DLC (local loop and NLD), MPLS, the internet, ISDN and IP-VPNs are the most widely deployed, followed by point-to-point Ethernet. ISDN is typically used for back-up and videoconferencing while MPLS helps connect regional and area offices.

Of course, network security remains the top priority. To meet this requirement, mediums such as Trend Micro ESS, content filtering, spam prevention, firewalls, load balances, email security plans, anti-spam devices and web filters are commonly used.

The use of applications such as enterprise resource planning (ERP) has also become widespread. ERP packages typically help the company automate and link all its business processes. The system helps combine the data of formerly separate applications, thereby synchronising data and information across multiple systems.

Another widespread application is radio frequency identification (RFID) technology, which allows companies to track goods throughout the supply chain. This allows automated identification and tracking of items and real-time visibility, and helps reduce errors in the logistics process.

Business intelligence tools such as data warehousing and geographic information system (GIS) are also being utilised. Data warehousing enhances end-user access to a wide array of data and the company’s decision-makers can use the support system to obtain specific trend reports. For example, the sales figures of a particular product can be traced back three or four years. GIS has helped such companies improve data management and sharing of data securely with business partners and contractors. This, in turn, has allowed streamlining of business processes.

Internet and mobility tools such as personal digital assistants are also making their presence felt. These help enhance efficiency and information flow from the field to the head office. Also, sales executives and distribution personnel do not need to file paper-based reports. Instead, data can be sent to the central server via GPRS or it can be synchronised directly with the central server.

In the future, global data synchronisation service  is expected to come to the fore. This tool will help companies exchange accurate, up-to-date and standards-compliant supply chain information. The basic idea behind data synchronisation is that it enables flawless sharing of information to create value and eliminate waste.

All in all, companies with a large sales and distribution network are pulling out all the stops to deploy a robust telecom infrastructure that would help them respond to evolving market scenarios and customer requirements.

tele.net conducted a survey of 12 companies with a  widespread sales and distribution network to assess their telecom requirements and solutions.

The following questions were asked in the survey:

• What are the organisation’s key technology requirements?

• What mix of service providers and vendors is used for various services?

• What are the key issues and concerns with respect to telecom infrastructure and services?

• What are some of the enterprise and mobility applications being implemented by the organisaton?

•What kinds of redundancies have been built into the organisation’s network?

• Which network security tools have been implemented by the organisation?

•What are some of the new applications that the organisation is looking to implement in the near future?

Key technology requirements 

The results of the survey illustrate that companies with an extensive sales and distribution network opt for a robust set-up in order to establish an agile and responsive distribution chain, increase efficiency, refine internal production processes and reduce unnecessary overheads.

Therefore, a mix of wireless and wireline technologies is being used. For example, for WAN connectivity, DLC (local loop and NLD), MPLS, the internet, ISDN, IP-VPNs and point-to-point Ethernet are used. In most cases, ISDN is used for back-up and videoconferencing while MPLS provides a secure, scalable and cost-effective solution for inter-branch connectivity. Manufacturing major Moser Baer, for instance, uses leased lines and MPLS. Many of the company’s offices are connected through 12 MB point-to-point leased lines. This, according to the respondent, affords the company always- on connectivity, which supports bandwidth-hungry applications, and helps trim overheads as it is a cost-effective connectivity option.

To connect its remote and branch offices, the manufacturing major has opted for an MPLS-VPN set-up. This medium was chosen due to its reliability, cost effectiveness, security and the fact that it is flexible enough to accommodate any required network expansion.

Simmtronics Semiconductors Limited (SSL), on the other hand, has a 4 Mbps ISDN infrastructure that aids videoconferencing and a 4 Mbps IPLC connectivity, which affords the company several advantages including quick installation, low initial investment, etc. The company’s current internet set-up is of 1 GB.

Interestingly, travel major Yatra Online also uses an MPLS cloud. According to Manish Amin, CIO, “This has provided us with a cost-effective medium of communication. It also offers increased response time as compared to other mediums, along with improved application performance.” The company makes use of two MPLS clouds, sourced from Tata Communications and Reliance Communications (RCOM).

For last mile connectivity, optic fibre is most widely used, followed by DSL. The surveyed companies are using wireless, primarily in the form of radio frequency and Wi-Fi, in conjunction with either DSL or optic fibre to connect their sites in remote areas and for back-up.

Apart from standard mediums of communication, software applications and other telecom-centric set-ups are also widely used, including enterprise resource planning (ERP), customer relationship management (CRM) and business intelligence (BI). A case in point is Domino’s Pizza, which has opted for ERP. This package contains several modules that simplify the company’s production processes and make the supply chain more transparent. Moreover, ERP helps it optimise procurement and dispatch of inventory to outlets spread across multiple cities.  The company’s inventory is centralised region-wise where the commissary (equivalent to a factory or warehouse) of a particular region procures and supplies all items needed by the outlets according to predetermined dispatch plans. The outlets forward their requirements list to the commissary, based on which the items are procured or produced and supplied to the outlets. The inventory position is constantly monitored using ERP and the purchase and manufacture of items is based on it.

Yatra Online, on the other hand, uses the CRM tool. CRM helps the company track and organise its contacts with its current and prospective customers. The company can systematically enter, store and access information about customers and customer interactions in different company departments. The basic goal is to improve the services provided to customers and use customer contact information for targeted marketing.

Mumbai-based garments major Globus Stores makes use of an interesting medium, the remote infrastructure management system (RIMS). The main aim of this system is to set up a network operations centre (NOC) within the company premises, says the company respondent. RIMS’ scope extends to taking care of six different levels of management: server management, network management, desktop management, application management, data back-up management and vendor management. The company feels that establishing an NOC helps it foster a holistic approach since it allows them to track the quality of the business service and relate it to critical network, system and application performance.

A few companies make use of data centres as well. SSL’s data centre, for instance, performs several functions, including ensuring server uptime, data recovery and back-up, storage management, hardware and network operations, and operations and end-user support.

Barista Lavazza too has a data centre in place, which serves similar functions, apart from archiving data, which is done on a weekly or monthly basis.

Service providers and vendors 

Since the day-to-day business of such companies is extremely complex in nature, their emphasis essentially is on reliability when it comes to opting for service providers.

The survey shows that the services of RCOM, Bharti airtel, BSNL, Tata Communications, Mahanagar Telephone Nigam Limited (MTNL), Tulip, Sify Technologies and AT&T are mostly used for WAN technologies.

With regard to last mile connectivity, the preferred service providers are Bharti airtel (for DSL, optic fibre and metro Ethernet); Tata Communications (for metro Ethernet) and Tulip (for wireless).

Key issues and concerns 

Connectivity, uptime, network vulnerability, service provider and vendor performance, and cost of telecom equipment and services are the main areas of concern for companies in the sales and distribution vertical.

Yatra Online’s Amin, for instance, says, “Relying on the operator to provide the necessary product within the stipulated time frame can sometimes prove to be a hurdle.”

Bata India faces a similar concern. According to the respondent, last mile access, service and bandwidth availability are sometimes uncertain.

Lack of adequate connectivity in rural areas is another issue. Says the respondent from Koutons Retail India, “We find it difficult to connect with our outlets in rural areas as internet connectivity is not adequate. We are fully dependent on our client. Only when they connect to the internet or the server can we obtain crucial data. This is a serious issue.”

The cost of telecom equipment is a concern for Shoppers Stop. So far, the company has been selective about adopting new technology solutions. The respondent feels that though most new solutions are promising, the overall costs can be prohibitive at times. Weighing the cost of these solutions against the benefits is a key consideration for the company’s IT team while deciding on investments. Identifying the appropriate technology partner may also present a challenge and so, the internal team follows stringent processes while selecting partners for such deployments.

Mobile and enterprise applications 

A host of enterprise applications is being used. These include bandwidth-hungry applications such as audio- and videoconferencing, toll-free services, instant messaging, web conferencing and VOIP.

The survey findings indicate extensive deployment of mobile applications, with most of the surveyed organisations using mobile email, mobile data connectivity and corporate intranet. Other popular applications that are in use include personal information management, conferencing on the mobile, push alerts, sales force automation and vehicle tracking systems.

SSL, for instance, uses mobile email, mobile data connectivity and conferencing facilities to stay connected while on the move. According to the respondent, the company’s sales personnel are equipped with data cards provided by RCOM, through which they are able to access the company’s corporate intranet and any other relevant data even from remote locations. The company’s senior executives, on the other hand, use BlackBerry devices for the same purpose.

Network redundancies 

Most of the companies in this space have a relatively simple redundancy set-up. They typically utilise a mix of infrastructure such as leased lines, ISDN lines, UPSs, VSATs, network switches, routers, data back-ups and applications such as data archiving and recovery. SSL uses individual back-up drives, which, according to the respondent, are very reliable and cost effective.

Network security 

A secure network is the topmost IT priority for these companies. In most cases, a multi-tiered infrastructure is in place. For example, Moser Baer India uses Trend Micro ESS, content filtering and spam prevention to secure its network. Yatra Online utilises firewalls, load balances, email security plans, anti-spam devices and web filters sourced from Cisco. Moreover, these safeguards are installed at different levels so as to keep access to applications and data being transferred through the devices secure.

The road ahead… 

The survey results show that each of these companies has a clear picture of what kind of technology or product it is likely to deploy in the near future.

For example, Barista Lavazza is looking to implement a one-stop solution that would offer voice and data connectivity on a single platform. In addition, to further streamline connectivity between its offices, it is considering implementing VPNs. This, the company hopes, will provide support and remote access, and simplify updation of records. Web-based the applications are another area of interest for Barista. Besides this, the company wants to implement audio- and videoconferencing in its corporate offices.

Travel and hospitality player Taj Hotels Resorts and Palaces has a multi-point agenda. The company plans to continue rolling out MPLS across all its sites, since it is a cost-effective medium that provides easy access to remote sites. Taj also plans to enable high speed internet lines for both its guests and employees, provide integrated voice and data services, and deploy digital fibre-based technology to connect and supply technology to the guest rooms.

Manufacturing major Sterlite Technologies Limited (STL) plans to focus on three specific areas: business intelligence, customer collaboration and continuous improvement. A key priority is to provide intelligent and analytical data, which is one of the key IT objectives of its business. In 2009-10, the company implemented the SAP BI/BPC system for its finance and marketing functions. Through 2010-11, STL intends to extend this to areas like operations and human resources. 

To conclude, it is evident that a robust and streamlined communications infrastructure has gone a long way  in helping companies with a vast sales and distribution network to stay up to date and meet market challenges and competition head-on.

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