Well, it depends upon what you define as success. ERP always meant integrating various functions within an organisation. Thus we could unite departments and they could communicate with each other more effectively. In essence, information did not have to be recaptured or re-entered into the system. For example, data already present with the financial department systems do not have re-entered for use in sales, HR, and other functions.

So, I wouldn't agree that ERP has failed companies. Success depends on various factors---and technology is just one of them. As far as putting into place the right processes is concerned, it was definitely a success; maybe in other ways it was not. There are companies that have saved money by eliminating multiple systems. And the planning needs to be linked to execution also.

First, it needs to be ascertained whether it is in the companies best interest to maintain inventories, and if so, then how much. Zero inventory may not always be the best policy. The tech is there to help them achieve zero inventory but do they want it is the question. Like the paper industry; even internationally, many players want to want to keep some inventory handy, given the volatile nature of the industry and this is part of their business strategy.

Solutions are multifold: to start off with, we need a good forecast which is part of demand-planning; then, there’s the ability to come up with a deployment strategy----how do we get rid of this inventory; and thirdly the question of how to automate and get early warnings of any potential inventory pile-ups. Obviously, all the processes need to be synchronised with others like forecasting when chalking out a deployment strategy. So when we talk about supply chain management we're talking about supply chain planning, execution, event management, performance measurement & collaboration.

Actually, in many cases this did happen. Manufacturing and distribution functions have become a lot more efficient due to ERP. Take the case of Compaq. They operate in international markets that are very volatile. We've been working with them---implementing our solutions in phases. Generally a big-bang implementation takes time and thus corporates prefer modules. Already their inventory holding costs have come down by double-digit percentage. In India, Mahindra & Mahindra have reduced inventory costs by as much as 40 per cent, BPCL says its saved close to Rs 40 crore while others like Tisco have saved Rs 33 crore, all this thanks to intelligent ERP deployment.

Technology is just a piece in the entire supply chain management process. What people often don't realise is that there are a lot of general management issues involved. I mean we're talking about relationships and interactions with suppliers and distributors. Issues like trust and long-term strategies play a vital par here. Technology is not a magic solution. Also when we're considering issues like redesigning---closing down some units, starting some new ones----redeployment of resources becomes a top management issue and the choices are made accordingly. Theoretically technology may hold the solution, but for its ultimate success, planning and implementation are equally important.

I feel there is too much analysis being done today about what the current situation is and what the future holds. Instead of just trying to fail-proof their affairs, companies need to step out into the market place. Maybe embark on pilot projects with limited scales if they don't want to make major commitments given the economic scenario. So they may proceed with caution but they should proceed all the same. They should act now and then use the experience and feedback to improve and fine tune their systems and processes. But the critical thing is to act now and not wait till the next upturn to build up capacities.