Eveready Boosts Forecast Accuracy with a Simple Mobile App

Summary:

With a distribution network covering 3.3 million, Eveready had a challenging job of keeping a tab on a distributor’s inventory position for timely demand fulfillment. Read how a simple mobile app that links the salespeople with HQ’s servers and their distributors helped Eveready improve forecast accuracy and lower stock pile up.

 

Highlights:

Ideas for a mobile app naturally tend to come from users — which makes scope creep and unreasonable demands a real challenge.Arup Choudhury, Sr. GM-IT, eveready Industries, took ideas from users but had to navigate past impossible requests.

Reader ROI:

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Eveready is known for a lot of things, batteries, flashlights and even CFLs, packet tea, and mosquito repellants (surprise!). What’s less known is that its distribution network covers 3.3 million retail outlets out of a total universe of 7.3 million FMCG outlets – which means they are present in villages with populations as low as 5,000. To keep that network serviced, it needs over 4,000 distributors. That’s a large number of people whose requirements need to be orchestrated. “It was becoming exceedingly important to keep a tab on a distributor’s inventory position for timely demand fulfillment. It was also important to know which distributors were doing well and who were not,” says Arup Choudhury, Sr. GM-IT, Eveready Industries. At the same time, Eveready’s sales force, too, had its set of problems. The company’s sales people are assigned to specific beats and in order to push Eveready products, they needed to be equipped with information of each retailer they visit. Knowing, for instance, at what intervals a retailer orders for batteries and CFLs could go a long way in persuading him to stock more batteries and fewer bulbs.

“We just had to build a small interface to capture the primary, secondary, and forecast information into a data warehouse and use a tool to generate meaningful information from it

But until recently, gathering this information was a manual exercise, which led to human errors and a heavy reliance on an individual sales person’s judgment. That’s when one sales person came up with an idea. Use a mobile phone to link salespeople with HQ’s servers and their distributors. “The project was the brainchild of a sales manager from North India,” remembers Choudhury. That is a common occurrence with mobile projects. Because everyone has one, many consider themselves experts on the technology and its capacities. And as good as it is to gather ideas from the troops (and save yourself much change management headaches), scope creep and just plain dumb ideas need to be shot down quickly and efficiently. That’s a leadership role that says CIO all over it. Choudhury, for example, remembers the amount of discussion and deliberation that went into the ideation of the mobile solution. His first job was to ensure that they were not inundated with ideas, so he made certain that branch managers acted as idea collectors and filters for their sales officers’ ideas. “I met with 15 branch managers,” says Choudhury, “and there were suggestions of empowering the distributor’s sales force with PDAs. We had to strike it down because it just wasn’t feasible to hand out over 5,500 devices and keep track of them. So we started by setting the objectives we hoped to achieve through the implementation and short-listed the ideas on those parameters.” To carry out the project, Choudhury worked with an outsourced provider to develop a mobile interface for its sales reporting system which interacted with their existing database. “We just had to build a small interface to capture the primary, secondary, and forecast information into a data warehouse and use a tool to generate meaningful information from it,” says Choudhury. Now sales agents could just log into their accounts using a Java-enabled mobile and meet retailers well-equipped with information like the past history of that retailer, its stock-keeping history and specific sales. It ensures retailers that Eveready cares and that at the distributor’s end there isn’t an unnecessary pile-up of stock.

“We just had to build a small interface to capture the primary, secondary, and forecast information into a data warehouse and use a tool to generate meaningful information from it

But there was a question of security that needed to be taken care of. What if a sales person lost his phone with market data on it? Choudhury says the risk is insignificant because the mobile phone would only carry data pertaining to a very localized market. Security, however, needed to be tight at the integration point because the entire organization’s data resides in a single database. And Choudhury wanted no short- cuts here. He ensured that data on the central server was encrypted. In collaboration with his mobile provider, they built a system whereby the database can only be decrypted while generating reports and dashboards, through the program itself. “So even if anyone has access to the database, the data will not make any sense until decrypted,” says Choudhury. Also read Forrester:Enterprise Mobility Trends The project, which was first rolled out in India’s eastern region including Kolkata, Patna, Bhubaneswar, and Guwahati in 2008, was fully completed in November of 2009. Choudhury says Eveready put up capital of Rs 25 lakh for the project and pays another Rs 15 lakh every year for hosting charges and reimbursing employees. “Just with the implementation in the eastern region, I think we have attained our ROI,” says Choudhury.

Much of that return has come from the 15 percent increase the company has seen in forecast accuracy and lower stock-out incidents at the retail level. There has also been an increase in the number of inventory turns (a measure of the number of times inventory is sold or used in a given period). It’s also helped the company connect better with their sales employees who can report online. “No more sitting after office hours, filling up excel reports for them,” says Choudhury. “They can spend quality time at home after office hours.” The mobile project, in the meanwhile, is surging forward. There are already plans to integrate market intelligence, capture economic and market population data, add competitor information, etcetera, to the phones to make a more realistic trend accessible to the field force. “We also want to extend this solution to the modern trade business (large format stores), this time with PDAs for order booking and delivery. We will also integrate this with a data mining solution to help us in product placement and marketing strategies,” says Choudhury.