Sudesh Jain, Senior Vice President (IT), Transport Corporation of India (TCI) Group, talked to KTP Radhika about the drivers of technology adoption in the Indian logistics sector and the major IT projects that the company had taken up in the recent past
The logistics industry in India is evolving rapidly. The penetration of IT at Indian companies in the logistics sector is relatively low in comparison to that of foreign players. However, Indian players are realizing the importance of technology and are increasingly investing in it. IT enabled technologies will streamline business processes and lead to customer satisfaction. Technology allows these companies to operate from anywhere and, at the same time, maintain visibility and control. With the rapid entry of global players, Indian third-party logistics (3PL) service providers will have to adopt technology in order to sustain and innovative technology will help them remain competent. Also, to meet the service standards set by large multinational companies in this sector, there is no option for the smaller players but to adopt technology for them to survive and excel in such a business environment. Today’s logistics players have increasingly started investing in IT. By deploying, the latest technological processes, logistics companies are able to deliver result-oriented solutions, which allows them to increase service efficiency and reduce overall costs. Moreover, it also helps them in integrating their operations with partners and customers.
What are the main challenges that this industry segment faces when it comes to technology adoption?
With many small and mid level players, the fragmented and unorganized nature of this industry sector is a big challenge. Small players are unable to adopt IT for things beyond basic services such as order processing, customer support, etc. The day-to-day operational expenditure, costs involved in compliance and varying documentation, toll taxes etc. form a major part of their expenses and, therefore, the focus on technology is missing. Also, the industry lacks trained and skilled personnel to handle these operations.
What are the IT policies of TCI? How important is IT to your business?
In TCI, IT is the backbone of each and every business process and we are constantly expanding our IT services. Here, we do not follow any manual process and all of our processes and functions are interlinked through IT. We have deployed a customer-centric delivery model, which encourages the adoption of new services and technology in order to ensure customer satisfaction. At TCI, we have a technology-enabled warehousing system, one that helps ensure better asset management. We have integrated processes through the supply chain to share valuable information including demand signals, forecasts, inventory and transportation as well as to facilitate collaboration with all of our stakeholders. Apart from this, ERP has been initiated for improving service delivery and tracking service level agreements. We have integrated our in-house ERP with our customers’ systems. We have also set up an integrated supply chain management system, which enables real-time visibility of material requirement and inventory throughout the value chain, and provides decision support at all stages of operations.
Apart from this, we impart regular IT training programs to all of our people across the country through our dedicated training centers.
As a head of IT, what are the projects/innovations that you are currently spearheading?
There are several projects that are on-going and a key one under execution is the Contract Master Form (CMF). The IT team of TCI developed the system in house to get all billing business through CMF and it is being implemented
Give us an overview of the IT projects that you have brought to a conclusion.
TCI has undergone various changes in technology over the last decade. To make the payment system systematic and as per schedule, the IT/accounts department provided an option for centralized payment to different types of vendors. Here, the system automatically generates the date-wise liability against respective documents and credits the respective vendor/associate. Subsequently, the corporate office makes the payment as per schedule. It made our payment process much faster and fund management more effective.
Do you feel that Cloud computing and virtualization will have a significant impact upon this sector?
With Cloud computing, the organization accesses software on its vendor’s server via the Internet. In logistics, Cloud computing is available in three domains: supply chain execution, mobile resource management and global trade compliance. The Cloud and virtualization will help save cost. However, it will take time for these concepts to mature in the logistics industry for big players. The small players can opt for this process to save on the high initial cost of acquiring technology.