Venky’s Develops ERP for the Poultry Business on Open Source

Summary:

Processed food giant Venky’s uses Open Source technology to tailor an ERP for its poultry business, thus enhancing operational capabilities and boosting transparency.

The Organization: Established in 1971, Venkateswara Hatcheries (VH Group) is today a $1 billion (about Rs 6,000 crore) conglomerate and the largest fully-integrated poultry group in Asia. Its founder, Late Padmashree Dr. B.V. Rao is often referred to as “the Father of the Indian Poultry Industry”. With such a grand legacy and subsequent accrual of relevant expertise in the poultry industry, the company’s operation encompasses all the aspects necessary for successful poultry farming.   VH Group’s Rs 1,000 crore business wing—Uttara Foods and Feeds (UFFL) is a leading manufacturer of quality poultry feed. Venky’s Feed, and the company’s flagship brand Venky’s Chicken are among the forerunners in their respective markets. This profitable business unit also has production plants spread across eight different locations in India. In fact, the company is so profitable that it went on to buy an English football club, the Blackburn Rovers, for £23 million (about Rs 209.3 crore) in late 2010.

The Business Case: “The needs of the livestock industry are very different from those of others,” claims B. Venkatesh Rao, managing director, UFFL. And that’s the reason you don’t, everyday, find a hatchery that uses an ERP system. Unlike other ERPs, which monitor inanimate objects, the ERP for poultry business has to be more dynamic because the industry requires high levels of manual monitoring. Until 2012, UFFL was running an in-house IT solution . With the gradual expansion and resultant globalization of business, this no-frills solution was soon found to be wanting. Most importantly, around 2010, UFFL got proposals for poultry seed farming in Bangladesh and Vietnam, but the old outdated system stood as a stumbling block. Poor infrastructure in these countries prevented the company from laying its own corporate lease lines, and privacy concerns ruled out cloud or public domain as an option. Also, language and local tax conditions posed challenges as well. Thus UFFL realized there was a burning need for a new and effective solution.

The Project: The IT team at UFFL consists of people well-versed and experienced at Open Source technology—the reason they chose OpenBravo, an Open Source ERP vendor. The choice to go Open Source was unanimous, says Rao. “We wanted an open platform that gives us the flexibility of customization.” The Open Source solution gave the IT team at UFFL the opportunity to experiment with new ideas and build new capabilities, but they first diligently studied the OpenBravo platform. In collaboration with solution architects from OpenBravo, UFFL’s IT team engineered a state-of-the-art ERP solution.

ALSO READ: Is Open Source the Answer to ERP?

The Solution: UFFL went live with the new ERP in early 2011. One of the noteworthy features of OpenBravo was its localization pack, which allows it to operate in 64 different languages; a feature soon put to use, given their expansion to Bangladesh and Vietnam. However, what made the system more effective was its Web service.

In the world of increasing mobility, Web service answered UFFL’s twin needs of protecting data and enabling mobility. The company has also developed a mobile application which its sales force can use to place purchase and transaction orders. The challenge with the new solution, though, surfaced when it was time to hand the system over to users. With the new solution, UFFL standardized on a number of things; mainly, its reporting structure. However, users were very used to seeing reports in a certain format. Therefore, a change management drive was needed. The company launched a massive awareness and training exercise to educate users about the merits of the new system and turned their reluctance into approval.

The Benefits: Today, UFFL has more than 250 users on the OpenBravo system. The biggest benefit, according to Rao, has been the increase in transparency. “The system has made live updates in the livestock business a reality. ” The system has also uncovered capabilities hitherto considered impossible. For instance, they’ve developed a new desktop application that allows employees working from remote areas with poor Internet connectivity access an offline module to continue work uninterrupted. The Web service functions can auto-synchronize any incremental work as soon as connectivity is established. Venky’s can now confidently consider expanding their business in remote areas. Send feedback to varsha_chidambaram@idgindia.com. Follow her on Twitter @Varsha_IDG.

B. Venkatesh Rao, MD, UFFL, and his IT team made effective use of Open Source technology to create an ERP system that addresses the unique requirements of the poultry business.