Recently I heard an interesting story about how the work in a unit of Scooters India Ltd came to a standstill because the unit had run out of washers.Now washers may seem like minor components; made out of rubber, they cost about a rupee. But they are there to perform the important task of protecting two components that are in constant touch with each other. Without washers, the work can? go on.
By Anoop Verma
The stock of washers could not be replenished in time as Scooters India maintains its inventory manually. The record register showed that there were close to 60000 washers in stock, in reality there were none. If the company had a proper Inventory Management System, it would have received a timely alert that the factory is about to run out of washers and the stocks could have been restored well in advance. Scooters India Ltd has initiated the process for getting an ERP solution, but the final implementation will take some time.
On the other hand there is the PSU called BHEL, which is India? largest engineering and manufacturing company of its kind. The company? investment in R&D is amongst the highest in corporate India and it files almost one patent per day. Such achievement is not possible unless the organisation is making optimal use of Information Technology. The core functions in most units of BHEL are integrated through ERP. The company deploys an impressive array of IT solutions to bring efficiency and transparency in almost every area of its operations.
The global advisory firm, Zinnov, has released a report on the PSU sector. The report states that the PSUs are on an average spending 2% of their revenues on IT. The maximum IT investment in the PSU space is happening in the BFSI and energy verticals. In FY 2012, the total IT investment by Indian PSUs is estimated by Zinnov to be in the range of $8.5 billion.
The IT heads in the PSU sector show lot of personal interest in the IT solutions like Cloud, Big Data Analytics, Mobility, etc. If interest is there, then why can? the Public Sector reap the benefits of these technologies? The problem lies in the process by which new technologies are procured and implemented in the PSU sector. The process is too complicated and IT projects often get mired in delays. This is why the operations in many PSUs continue to be manual, even though tremendous strides have been made in ERP during the last decade.
The technical challenges of implementing IT in Public Sector are small compared with the human challenges. In fact, majority of the PSUs where systems continue to be manual are those where the human side of the equation is failing because the management or the workers are not fully convinced about the efficacy of IT systems. The IT implementations can be highly complex, visible and vital to the success of the business. It is easy for such complex projects to get entangled in endless coils of bureaucratic red tape.