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IT-backed enterprise resource planning (ERP) helps companies manage resources more efficiently. Introduction of such solutions no more makes news in corporate India, including most central public sector enterprises. Coal India, however, is an exception.
The listed state-owned miner that grossed over ₹74,000 crore in sales revenue for 2014-15, orders spares without knowing if it already has enough lying in different mines.
It has no method of scheduling maintenance of costly machines. They are attended to only in case of break down.
Last but not the least, the miner doesn’t have enough data on approximately 3.27 lakh employees, spread over seven mining subsidiaries that operate 429 mines across all coal bearing States in the nation except Telengana.
Lacks IT backbone“CIL’s management practices are outdated by 50 years,” says Mahadeo Jaiswal of Gurgaon-based Management Development Institute (MDI).
The autonomous non-profit organisation, set up by the Indian government, was recently asked by CIL to evaluate the IT system of the miner and help it migrate to ERP.
Incidentally, this is not the first attempt. In end-2009, the company announced plans for introduction of ERP solutions at approximately ₹1,000 crore. The proposal got stuck in tendering logjam.
Jaiswal, however, says the migration to ERP wouldn’t be easy for CIL as it doesn’t have the basic infrastructure – the IT backbone. Large numbers of mines, located in remote areas, enjoy little data connectivity. MDI will therefore first map the basic IT requirement. The options include radio link, V-SAT, and leased line networks. CIL has already inclined RailTel to create the IT backbone at its mines in Jharkhand. But company sources report slow pace of implementation.
Jaiswal says if everything goes on time, they will target migration of two subsidiaries to ERP by end-2018.
CIL has to codify all spares and consumables as well as vendors, in a uniform manner to fit IT systems. Singrauli-based Northern Coalfields, it is learnt, has made some progress in this regard. Sambalpur-based Mahanadi Coalfields and Dhanbad-based Bharat Coking Coal too, have done some groundwork.
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