Established in 1943, Karam Chand Thapar (Coal Sales) Ltd. (KCT) is the largest coal logistics, sales, and services provider in India. A subsidiary of Thapar Group, KCT moves more than 70 million metric tons of coal annually. Customers include state electricity boards, steel plants, paper mills, and sugar mills. The company recently added coal importing––from Southeast Asia, South Africa, and Australia––to its portfolio of business activities.
With coal sales and logistics operations spread across 40 locations and the majority of India’s 28 states, KCT needed a flexible enterprise resource planning (ERP) systems to replace its time-consuming manual business processes. In 2011, the company implemented Oracle E-Business Suite Release 12.1 for its manufacturing unit, Indicon Enterprises Ltd., and automated business processes across the division.
In July 2012, KCT rolled out the second stage of its ERP system and implemented Oracle Financials, Oracle Inventory, Oracle Order Management, and Oracle Purchasing for its imported coal division to improve data visibility and achieve an enterprise view of coal sales and logistics business operations. The company reduced sales quote preparation time by 40%, cut inventory costs by 25%, and increased customer and user satisfaction.
As KCT’s customers include some of India’s largest coal-fired power stations and manufacturers, it was critical the company provide accurate sales quotes and timely order delivery. Developing quotes and delivery timelines in the manual legacy system was time-consuming and error-prone.
Using Oracle E-Business Suite Release 12.1 applications, sales team members can now quickly and easily access real-time coal landing costs––including purchase price, freight, insurance, and taxes–– on their laptop or desktop from any location to prepare quotes 40% faster and improve customer service.
“With a consolidated view of ERP data across financials, inventory, order management, and procurement, our customers are happier because they can receive accurate order details from sales representatives, which allows them to commit to their own customers’ expectations,” said Kunal Mukherjee, senior manager, department of information technology, Karam Chand Thapar & Bros. (Coal Sales) Ltd.
KCT also gained better visibility into accounts receivable and accounts payable through financial data integration across the imported coal division. The company accelerated the manufacturing unit’s monthly accounts closure by 40% and expects to close accounts 50% faster in the coal division. Integrated data from Oracle Purchasing and Oracle Order Management also improved visibility across the entire purchasing and customer order cycle and greatly improved cash flow management.
“Staff members can now quickly dispatch purchase order information to the finance department after an order is booked. This allows the finance department to debit the purchase order amount against the company’s cash position when the coal arrives at the plant in India. We then know exactly when we have to pay to our suppliers and when to expect payment from the customer. We improved cash flow management and gained insight into purchasing lead time, which streamlines production planning,” Mukherjee said.
As a logistics company with segregated business processes and coal stock that might be in-transit, in receiving, in storage, staged for shipping, or consigned to a customer, KCT needed to improve visibility into its inventory status for imported coal.
“Like many other companies, we wanted to keep our inventory level to a minimum and reduce our carrying costs. Oracle Inventory Management creates an automated alert when stocks dip below preset reorder levels. Being able to sustain our targets has reduced our inventory holding costs by 25% and improved cash flow,” Mukherjee said.
The easy-to-use Oracle E-Business Suite Release 12.1 system facilitated user adoption which has improved data accuracy across the enterprise.
“We have 40 staff members using Oracle E-Business Suite, and all are committed to using the system effectively. They know they are using a reputable global ERP platform, which is deployed by many other organizations, increasing their overall skill level,” Mukherjee said.
After implementing Oracle E-Business Suite Release 12.1 in its manufacturing and coal import divisions, KCT is planning to roll out the ERP system to other divisions to achieve a consolidated view of the company’s financial position and support future changes in organizational structure. KCT is also refining Indian tax calculation and dashboard capabilities to provide senior management with a single view of the profit and loss statement and balance sheet.
KCT considered other vendors but decided that the flexibility and scalability of Oracle E-Business Suite Release 12.1, combined with its ease of use, offered the best option.
“Oracle Financials offers unique benefits of data integration and allows us to gain a consolidated view of group financial statements for our future reporting requirements,” Mukherjee said.
After the ERP system went live in KCT’s manufacturing unit, Indicon Enterprises, in January 2011, the company began to implement Oracle E-Business Suite Release 12.1 for its imported coal division in July 2012. The new system went live—on time and on budget—in January 2013.
KCT worked with Oracle partner Conacent Consulting Pvt. Ltd. to manage the Oracle E-Business Suite implementation in the imported coal division.
“Conacent Consulting is very flexible and has an experienced team with expertise in ERP systems. They are also committed to the timely delivery of the project and enabled our imported coal division to realize the benefits of using an integrated ERP system,” Mukherjee said.