Climbing the Growth Curve
MICRO SUPREME AUTO INDUSTRIES needed to replace the outdated system that ran its auto components business. The vendor implemented SAP solution to boost productivity, cut costs, and continue its aggressive growth
Established in 1984, Micro Supreme today has emerged as an ambitious enterprise which has witnessed a positive growth trend in the last couple of years. Micro Supreme is engaged in design, development and production with 3 divisions, which includes automotive and precision engineering division (Precision mechanical components & assemblies being used in automotive engine, gearbox, power steering systems as well as power generation, shipping & precision engineering industries), testing systems division (environmental testing systems, laboratory testing systems, customized testing systems being used in automotive, chemical, electrical & electronics industry, etc.) and measuring instruments division (manufacture measuring instruments, relation gauges, jigs and fixtures). The company primarily deals and supplies components to tier 1 companies like Tata motors, Mahindra and Mahindra and many more.
Need of the hour
Micro Supreme outgrew its legacy business software disjointed applications that required repetitive, labor-intensive, error-prone data entry. Generating reports was slow and cumbersome, making it difficult for management to keep Micro Supreme on its growth curve. Hence, there was a need to have an efficient ERP system to induce efficiency into the existing eco system.
There were certain critical areas which definitely needed an upgrade. Like for instance, the company faced the challenges prevailing due to Single data entry. Vinayak Kulkarni, Chief Financial Officer, Micro Supreme Auto India said, “Before SAP we are doing data entry in various excel sheets. E.g. we are printing our invoices in Tally but not able to get the division wise sales report from it. So to get that report we need to maintain the excel sheet and re-enter the invoice figures like net value, taxes and gross value in excel.”
He further added, “Similarly at receiving end, we need to maintain the register book for goods receipt and re-enter the data in excel file, so that we can search the various goods receipt data efficiently. In case of purchase orders, we are using excel file to save all Purchase orders. In case of purchase requisitions, we are maintaining pre-printed books, and all sanctioning activities were done on them, with physical movement of the requisition book.”
Other areas include Inventory control wherein the company used to take the physical stock count of material as and when required to decide about the schedules to be given to the vendors. Furthermore, cost control is another area which was managed manually. Kulkarni said, “Before we never used to have the real time cost of the material. Now we can get the plan vs. actual cost of production order and up-to-date prices of raw material, bought material and semi-finished materials.”
Micro Supreme after stringent evaluation of solutions available in the market finally decided to go with SAP. Commenting on this, Kulkarni said, “Post analysis of available solutions, we decided that MySAP ERP/ Business All in One is the most ideal solution for us. SAP R/3 All In One is one of the best ERP in the world for automotive industry and most of the automotive industries are using SAP successfully.” He further added, “Our existing customers as well as prospective customers are using SAP. Above all, SAP offers us highly integrated modules and scalable as per business needs, which is primarily the key factor impacting our decision.”
To implement the required solution, the vendor roped in KPIT Cummins to understand and deploy the required SAP based solution at the company. Adding to this, Kulkarni said, “We had requirement that the deployment partner should be easily accessible i.e. should have support center in Pune. KPITCummins was easily accessible within Pune. Almost all the con-
sultants working on project had good communication skills in local language.”
KPIT Cummins was given two major tasks wherein the first one was to deploy an integrated system to avoid duplication of data entry work at various points. Secondly, it was to provide solution through which the company could fulfill its need to monitor the profitability of its three individual profit segments that includes engineering, tool room and instrumentation within Micro Supreme. Furthermore, solution was required for product costing for quoting the finished goods selling prices to its clients.
Micro Supreme was also looking to gear up the organization for business expansions and lay down standard procedures for the same and make its systems ready for audits such as TS16949 certification audit and financial audit.
KPIT Cummins developed and deployed Autodash for Micro Supreme. However, these tasks came with its set of challenges. The foremost challenge was meet customer expectation to get each and every process (current) in SAP including MSA, APQP, Document Control and more. KPIT Cummins spokesperson said, “User and core team members’ ERP readiness was not upto the mark. Hence, we were preparing for extensive training for these teams.”
In total, the companies had decided to deploy 120 standard Autodash scenarios and 4 Delta processes. Lot of detailing was required in terms of product costing methods with different array of overhead rates used in it. For the first time, Micro Supreme was enabling process re-engineering in logistics as material movements procedures did not exist before SAP was deployed.
At operational level, different modules were developed for different divisions as different planning procedures were involved like make-to-stock and maketo-order. Another challenging aspect was to develop module for TS16949 as huge reporting requirements were to be fulfilled.
“Finally, the time period was very limited timeline of 75 Days for implementation keeping view of project cost,” states KPIT Cummins spokesperson.
Post Deployment take-aways
KPIT Cummins executed the project within the given timeframe and went live within 70 days. Post that, they conducted training at Micro Supreme which also included pre deployment master data training.
With its business running with SAP software, Micro Supreme has improved operations in many respects. Since all business information is in one place and reporting tools are robust, generating reports for executives is much faster and easier, enabling them to make timely decisions that keep the company on its growth trajectory.
Post deployment, Micro Supreme has a fully integrated system across entire organization for all processes. Kulkarni said, “With new system in place, there are no duplication of work. Now, we have real time transaction reporting resulting in increase in manpower efficiency and real time inventory reporting. This has definitely provided us with the right ammunition to take the right decision at the right time.”
Now, the system can be easily accessible from anywhere. Also, uUser can go up to the root level by clicking the transaction. Adding to this, Kulkarni said, “If we are checking expenses ledger by clicking the transactions we can go up to the P O and G R level. Above all, one of the best advantage of SAP for FI is Open Item Management system in AP / AR / GL.” He further added, “In case of AR, we can easily get receivable amount from customers at any particular date. While, in case of AP, we can easily get payable amount to vendors at any particular date.”
Financial benefits include that the company officials can now enter different type of currency for different transactions. This will provide the user with easy information on export sale in foreign currency. In addition, manual cheque preparation is avoided through Lot Run F110. Thru F110, one can take out multiple vendor payment cheques. Above all, twiice bill booking is avoided in SAP.