B2B Blockbuster

The country's largest B2B player is a company that few people have even heard of: Tata technologies. The details.

By R. Chandrasekhar

Ever since it was spun off as a separate entity in February, 1997, Tata Technologies Ltd. (TTL), India, has increased its revenue from $4.8 million (1997-98) to $24 million in 1999-2000. Essentially in the business of helping manufacturing companies use infotech wisely, the firm has two streams of revenue: a B2B portal entitled MyValueChain.net, and a Value Chain Management (VCM) software.

A wholly-owned subsidiary of Tata Engineering with a paid up capital of Rs 2 crore, TTL, India, is part of Tata Technologies, a company set up in 1994 by foreign associates of the Tata Group and owned in part by the government of Singapore. The trigger for the formation of Tata Technologies--which has subsidiaries in the US, Singapore, Malaysia, and India--came from a 1993 study conducted by a Tata team. The study threw up three conclusions: much of the GDP growth of countries in the Asia-Pacific region would come from manufacturing; manufacturing would become intensely competitive; and, the only way manufacturers would remain competitive would be through the effective use of infotech. The study also found a lacuna. While a legion of technical institutes and software organisations in the region were churning out programmers who would write code, they were not helping manufacturers improve their competitiveness. That could only be done by someone who could bring in the appropriate domain expertise and combine it with infotech skills, thereby leading to integrated infotech solutions.

Says Patrick McGoldrick, 52, CEO and Managing Director, Tata Technologies (India): ``Our vision is to be the partner of choice for those industry leaders who view the strategic use of infotech as critical to their success.'' As a first step Tata Technologies developed the VCM portal to reduce the direct and indirect costs associated with the supply of automotive sub-assemblies and components. McGoldrick adds:``MyValueChain.net is for the automotive industry and targeted at all automotive suppliers and OEMs. However, the underlying software, VCM, can be used by any discrete manufacturer, or could be modified for other industries.''

Tata Technologies is now moving from automating the supply chain of its clients to creating virtual interfaces with their banks. Explains McGoldrick: ``Cash flow is critical in an intensely competitive industry like the automotive. By connecting to the banks we can crush out inefficiencies in the payment process. This reduces our customers' costs and makes the entire process transparent.'' Where do the revenues come from? TTL charges an annual subscription fee for its clients. McGoldrick says: ``We want to keep our revenue model simple and uncomplicated. The portal is profitable.''

TTL has three different practices with worldwide responsibilities:

* Enterprise Solutions which includes Customer Relationship Management (CRM), Enterprise Resource Planning (ERP), and advanced planning which comprises concept design, Knowledge-Based Engineering (KBE), CAD/CAM/CAE, product lifecycle management, and collaborative product commerce; and,

* Applications Service Provider (ASP) which handles the company's e-Commerce business.

In India TTL proposes to focus on improving three major business processes of its clients: the enterprise process; the engineering automation process; and the value chain process. Explains McGoldrick: "The enterprise process consists of the entire chain of activities that an enterprise carries out: from order to delivery. We improve this process using CRM, ERP, and advanced planning and scheduling techniques. The engineering automation process comprises concept design, engineering, and the transformation of product designs into manufacturing design. The value chain process comprises all the links between a manufacturing company and its business partners. Most importantly, we can integrate these three major processes through workflows, data integration, and knowledge management, so that manufactures can radically improve the way they compete.''

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