Feb. 18, 2010: New Holland Fiat India, a wholly owned subsidiary of CNH Global - the world's leading agricultural equipment company - is a majority owned subsidiary of the Fiat Group. Since its inception in 1996, the company had posted robust growth. In 2008, it manufactured over 23,000 tractors for the domestic and global market. Despite the debilitating economic conditions, the organization was able to post 38 percent growth.

Highlights

-- E-Kanban increased delivery reliability by 98 percent. It also increased material availability up to 100 percent.

To keep up that pace, the company wanted to attain faster production speed through improved visibility. "Eliminating stock-outs of critical items was imperative. We wanted to advance our relations with suppliers by giving them the benefits of greater visibility using auto generated e-mails and SMS notifications," says Avinash Arora, director-IS (India & S.E. Asia), New Holland Fiat. The organization also wanted to rationalize costs with better business practices and less clerical tasks.

Arora knew IT could deliver on these business priorities. He resolved to deploy the E-Kanban system (an innovation over Japanese Kanban System). This system can be integrated with an ERP and it allows real-time demand signaling across the supply chain and provides the company with improved visibility. Data extracted from the system can be used to optimize inventory levels by better tracking supplier lead and replenishment times. The system resulted in accurate requirement call outs to the supplier via e-mail and SMS.

Conceiving the idea was easier for Arora than getting the project off the ground. "Convincing stakeholders that IT could play a significant role in speeding up business performance and delivering information on-demand on preferred platform (mobiles, Web services, dashboard reporting and ERP reporting) was a key challenge," he says.

The cost and time for building the E- Kanban system was less than Rs 4 lakh (US$8,667) and 25 man-days of development and deployment. Currently, 187 critical items are covered under the E-Kanban system. Within a year of implementation, the project led to a 15 -20 percent reduction in overall inventory of E-Kanban items. It reduced lead times by 60-65 percent. E-Kanban increased delivery reliability by 98 percent. It also increased material availability up to 100 percent.

Source: http://www.networkworld.com/news/2010/021710-erp-used-to-gain-scalability.html