BYOD is a Reality & Organizations Will Have to Learn to Deal With it: LG India CIO
The consumer durables industry is known to experience a seasonal swing in the uptake of products. How do you help your business in identifying these trends and work with them to capitalize on it?
We had realized quite early that in order to predict and meet the seasonal swing of the products, the overall product planning has to be accurate. So we put in IT practices that have helped us improve our sales forecast. Our entire supply chain is divided into multiple elements like planning, aggregating demand, production requirements, procurement of raw materials etc. and we have brought in efficiencies in each of those segments. We are also bringing out products based on consumer insight derived from our latest engagement initiatives. These are the areas where IT has provided a fundamental support to the business. We also monitor our performance as an organization and our forecast accuracy has gone up and this is helping us. Even during those seasonal spikes we are able to meet the demand and this has been made possible by enhancing the accuracy of the forecast with the help of IT.
How do you then overcome challenges like supply chain issues of distribution and infrastructure?
Today we operate with 46 branch offices across India and have over 70 area offices which act as a touch points with our trade partners. We plan our strategy based on inputs from these partners and the map the production schedule for the 2 plants. The procurement of complete business units from overseas and third party manufacturers is also accounted for in this plan. We then share this with our partners and are able to procure on time.
LG is seen to be engaging with its customers in the online space. How much of this is IT enabled or do you believe customer engagement is purely marketing play?
I have always been a strong advocate of IT being a strategic support to the business. I beg to differ with people who claim that IT drives the organization. Let’s accept the reality. If we talk about purely functional initiatives, the best IT can and should do is go hand-in-hand. Synergy needs to exist. It’s all about working closely with the business and helping it with the latest technologies. The needs are changing rapidly. It is the role of the CIO to be aware of the latest tech trends and marry the business requirements with these solutions rather than hoping to run the marketing initiatives. Today there is social media where the feedback from consumers as well as products is used to develop products with features they will like. We capture this feedback in a structured manner and also conduct on-field as well as online research and survey. This gets integrated and creates a single view of the consumer. In terms of customer engagement we also have our service network. We interact with customers on two fronts- through demo request calls and after-sales support calls. These interactions are captured and tracked with the help of IT systems and the entire lifecycle of the consumer is retained. This flow of information is analyzed to come up with the pulse of the consumer and offer them products that they like. This also enables us to quickly gauge the performance of our products once they are introduced.
This need for analysis take us to your use of Kautilya- a BI tool. You seem to be unbiased towards indigenous products and solutions. How do you back yourself and your team while going for such made-in-India products?
When we went for Kautilya the field of consumer durables was seeing continuous evolution. It was getting difficult to capture what exactly the business wanted. We needed a product that would show the flexibility but we did not want to incur a lot of cost on it either. As an early adopter of ERP in 2000 we had utilized a home-grown product called millennium system. We came up with it because our business requirements were changing at a rapid and unpredictable pace. So a standard ERP wouldn’t give us the desired flexibility. We wanted to standardize our practices and match them to industry standards over the course of a few years and only in 2005 we decided to go with Oracle ERP. We follow such a maturity cycle at LG. We have a lot of flavor in the BI segment also. Kautilya caters to certain niche areas of the business. But overall there is a mix of other solutions like Business Objects and analytical tools on top of it as well. What really matters is the end result and not necessarily the tools used to achieve it.
While your business promotes mobile communications, how much of that percolates down in to your organization?
As a policy we have taken a deliberate call on not being very open to BYOD. We want to achieve a certain level of our maturity before we roll it out. We are supporting it at the very senior level. By end of this year, top management will be allowed certain devices that can connect to the corporate network. We will like to standardize before we go all out with BYOD.
Is there a lack of sync between the Indian business mentality and the aspirations of its largely young workforce when it comes to new age concepts like BYOD?
BYOD is a reality and organizations will have to learn to deal with it. It is only a matter of time and we definitely need to plan for it. But just because something is available doesn’t mean you consume it. It is all about the organization’s DNA. At LG, we sensitize our employees on the security aspects of such an initiative. We respect that they have an exposure of multiple tools but as an employee their first responsibility is to protect the company IP. We have generated a level of ownership among the employees and hence we haven’t received many requests for employee-owned devices.
Which are some of the other next generation technologies that excite you?
Some of the latest technologies that we are trying out today are Big Data, Enterprise Mobility, and Social Media. Cloud for us came long back and we have achieved a fair bit of maturity with it.
When we talk of newer technologies there inevitably comes up the point of skills gap. Be it cloud or now big data, how do you bridge this?
We have addressed this issue partly by means of outsourcing and partly by structuring our internal team in such a way that we have an operational support team and another team that works on the latest trends. Even when we outsource, the ownership remains with us because we believe that while they might be able to help with the latest technology, they would have very little understanding of our business.
What are some of the projects that you and your team are currently working on?
Due to the recent economic uncertainties, organizations are revisiting and rethinking some of the priorities they had decided on not too long ago. Checks and tweaks are being made to ensure everything is working as planned and bring the business up to speed with the current scenario. In our case we have seen that many of our product categories are doing quite well in most of the pan-India markets that we operate in. But we would like to further strengthen our position in the market and develop capabilities to get consumer insights. This will also help place our products in a better perspective and lend some competitive advantage to the business. The focus is primarily on the customer relationship management and trade partner relationship management. We call this initiative the ‘Sell Out Management System’ (SOMS) wherein we target our end-consumers through the channel and trade partners. We hope to engage ourselves with the customers. This was launched last year in the brand shops (exclusive LG product vendors) and is now being extended to our distributors. We will enhance it to include multi-brand outlets and regional specialty stores. These customer-centric initiatives also include a layer of social networking media and business intelligence which we hope will help us with some business advantages.