Winner

RIL’s Petro-portal

Reliance Industries needed a single-point entry system for its order management process. It was becoming difficult to handle huge orders manually. The e-commerce portal eliminated manual intervention, resulting in reduction of costs and errors, as well as increase in efficiency and speed. The value-addition in the entire project is the vehicle-tracking system integrated in the e-commerce portal, that helps customers track their consignments from dispatch to receipt

The mode of conducting business at Reliance Industries was by issuing manual orders, that amounted to more than one million, to all its businesses, resulting in a loss of Rs 8 crore every year. As their business grew, the errors also increased resulting in return of delivery and huge loss of materials. Obviously, no company could take such huge loss, thus automating manual processses was considered as the best solution for the problem.

Automating manual order process was not an easy task. The challenge was to integrate external agencies with internal systems for order life-cycle management. To achieve this it was necessary to re-engineer the entire order life-cycle management process eliminating manual intervention.

Says Ashish Chauhan, CIO, Reliance Industries, “We were planning for SAP CRM to overcome the order management problem. After evaluating aspects like cost, time, RoI, and manpower we found that the cost of SAP CRM implementation was reaching Rs 23 crore and duration for the entire process to complete would take too much of time, which was not viable for us. And that was the time when we actually thought, why couldn’t we go for an in-house solution?”

“We had evaluated SAP thoroughly and it was an urge to follow best practices by implementing the SAP solution and at the same time we wanted to cut down the cost and time involved. Hence, we went for an in-house development for our back portion and linked it with SAP ERP to get benefits at desired cost and time,” adds Chauhan.

Earlier, the company had different order mechanism to facilitate faxing and e-mail processes in its order management process. After automation, that mechanism had to be replaced with new one. The challenge was to integrate all the automated processes and centralise it to SAP ERP.

Implementation process

The first phase of deploying the B2B e-commerce portal was carried out in Reliance Polymer and was then spread across its various businesses like polyester, chemicals, and petroleum. Each time the project was implemented in each of its businesses, it was termed as next phase of the project.

“Our key focus area was that the process should be robust and there should not be an error of even 0.1 percent. Our business volumes are high and we get large orders every day. Even a single error meant loss of crores of rupees for us. All these points were considered before implementing the project. We are glad that all these points are met carefully after project implementation,” says Chauhan.

Company deployed three-tier architecture for this e-commerce portal. The bottom most layer is the SAP database, which communicates with the next layer of SQL database, which stores the online orders and after authentication checks, it updates the SAP database. Third layer is the application layer, which is Web-based and can be accessed directly through the Reliance Corporate Web site.

Customer focus

Reliance wanted its customers to benefit from the project too. Hence, it introduced the vehicle tracking system that is integrated to the e-commerce portal, which helps their customers in tracking their consignments from dispatch to receipt over the Internet. This technology was developed by Reliance using CDMA technology.

A CDMA GSM phone is attached to a device on the vehicle. Information such as vehicle number, and cell location is captured and fed to the tracking page that can be accessed over the Internet.

“Today, everything has been automated. Customer satisfaction has gone up substantially. From the employee perspective, they only need to supervise how things are going and focus on more challenging tasks.”

Paresh Pujara, VP, IT Systems, Reliance Industries, who was involved into decision making process, planning and system building says, “We get a huge number of orders every year. In 2005-06, we got 1.2 million orders. Each order needs to be executed in a time frame of 5-6 to a hundred hours. The earlier systems were not capable of delivering orders on time. Therefore we built a system that eliminates this problem.”

Three pre-requisites were decided upon before the roll out. First, the system should be simple to operate. Second, both agents and customers should have a clear idea of their business and orders and third, they should have know how to use Word or Excel.

“We built systems that are simple and required a knowledge of Word or Excel. Hence no training was required. We wanted support to be minimal. We have two people to support the system and in most cases support is given for problems like a hard disk crashing or loss of connection,” adds Pujara.

Says, Rajeev Bhaskar Sahi, President, Petroleum Retail Business,Reliance Industries, “The reality of the petroleum retail business is that locations are spread across the country and most pumps are situated in remote areas. Hence, communication with each location presents a problem. If you want to send a small document to one location, it becomes a complex task. We thought of a solution like an ATM machine, where the customer doesn’t have to go to the bank every time for getting information.”

Now, the company has a centralised logistic optimisation system that helps control activities from a single location. “The chances of errors is zero. Earlier in the manual process there were loopholes and opportunities for miscommunication to occur. Also, the customer used to call our office every half hour to get information, resulting in frustrated employees and harassed customers. Now, he can log on to the portal at any time,” adds Sahi.

The deployment of an e-commerce portal has resulted in less work, and 100 percent accuracy.

“Most important of all, none of the locations can go dry. For us, more than losing an order, loss of reputation or brand name should not happen,” concludes Sahi.

Uniqueness of the project

The end user is able to do multiple things through this portal in near real time. These are operations that earlier were not possible or took a lot of time. Some of them are:

• Order booking for any product with delivery option.
• Order tracking through the Vehicle Tracking System.
• Proof of delivery
• Order history and MIS
• Facility of rate negotiations for exports.

At the SAP backend, the portal has:

• Direct order updation to the SAP system after complete checks with minimal lag after an order is booked.
• Online movement of the order through SAP to various plants located across the country to facilitate timely order fulfilment.
• Online updation of the portal through SAP regarding order status to keep customers informed.
• Various MIS reports are generated regarding order and supply management.

Six months later

“We had decided that the project implementation in each of our businesses gets completed in three to four months of time frame. We are glad that the project got completed before time in each of our business across verticals saving our cost and time,” says Chauhan.

Within six months of the project launch, Reliance moved all 75,000 customers on to the e-commerce portal. Cost benefit obtained (about Rs 2 crore in salary) and elimination of the errors (Rs 8 crore in direct loss) saved RIL more than Rs 10 crore per annum.

For 2006-07, this portal is poised to clock more than Rs 30,000 crore of business, up from Rs 26,000 crore in 2005-06. It is expected to cross the Rs 50,000 crore mark by 2009-10.

Ramakrishnan Rajaram, Sr.Executive VP, Polyster, Reliance Industries says, “We have experienced a dramatic difference after the roll out of the e-commerce portal. Prior to the implementation, we use to collect orders manually, feed it into Excel, send trucks to dispatch orders, etc, which led to delays.

Roadmap

The company is looking forward to make regular updates in the project. Subsequently, petrol and diesel pumps and allied businesses have also started using this portal for their business. Aviation fuel retailing business, which is Reliance’s latest petroleum retail expansion, would be next on their list.