Air India Manages Cultural Change within Organization with Comprehensive

User Training

“If you want training in Oracle technology, you should consider Oracle
University as a first option. There may be external organizations that provide
similar training but they will not have the same depth of knowledge as the
vendor. Our experience with Oracle University has been excellent.” –
Spokesperson, Air India Limited

Air India Limited began operations in 1933 with two planes, one pilot, and a
handful of engineering staff. Its ‘office’ was a palm-thatched shed. Today, Air
India has a fleet of 45 aircraft, including Air India Express, a low-cost airline,
and flies to around 44 destinations worldwide. Headquartered in Mumbai, the
airline made a net profit of US$2 million (Rs.97 million) and increased revenue
by 15% in the 2005 financial year.

In January 2006, Air India implemented a range of Oracle E-Business Suite

applications as the basis of an integrated enterprise resource planning system.
To ensure its business and technical staff could maintain and use the system,
the company sent 40 employees to Oracle University.

The interactive training helped staff understand how an electronic business

management system worked and gave them the knowledge and confidence to
use the applications from the go-live date. The positive experience of staff
promoted a cultural shift in the organization and encouraged management to
consider extending the technology to other areas of its business.

A New Way of Working

Although Air India had used IT packages in the past, this was the first time the
organization had implemented a commercial off-the-shelf enterprise resource
planning solution. Although the concept of multiple users interacting on the
same platform was not new to Air India, usage of a true ERP solution was new
to the organization. In the past, the company had relied on manual, paper-
based processes to manage its inventory, purchasing, and budgetary control
and monitoring.
The airline sent around 40 people to Oracle University for training on Oracle
Inventory and Oracle Purchasing, followed by training on Oracle Financials.
Technical staff received Level 1 and Level 2 system administration training and
attended patch installation courses.

The courses took place at Oracle’s premises in Mumbai and occasionally at Air
India’s offices. The face-to-face classroom training included instruction on how
to use the Oracle applications and basic exercises. Oracle trainers were on
hand to help users when they ran into difficulties or had queries. Training
notes were also provided. Courses ran from three to five days, depending on
the subject.

Staff was happy with the quality and level of the training and instructors. The
airline did not expect them to master the application after one week of
training; the aim was to give them some reassurance on the system so they
had the basic navigational routes and make it possible for them to explore
other options. Training familiarized staff with the application and gave them
the skills and confidence to use the system by themselves.

Without the Oracle University training, the airline believed it would not have
been able to implement and use the Oracle solution effectively.

Air India had engaged an external company to implement the solution and
found that training improved communications. After the training, staff could
talk the same ‘language’ as the implementation partner. Risk was minimized
because both organizations understood what the other was trying to achieve.

A Cultural Shift within the Organization

One of Air India’s objectives when sending users to Oracle University was to
prove that the Oracle solution was workable. The airline believed that every
failed attempt to implement an IT-based solution will make acceptance within
the organization more difficult. People become more skeptical about such
solutions so it was important to ensure that the first lot of trainees had a
positive experience.

The airline reported that those who received training developed a better
understanding of the system. Raising awareness of the system’s capabilities
was a key objective and the organization believed it fulfilled that purpose.
Training has widened Air India’s perspective as to which other areas of the
company can benefit from the Oracle solution. The airline is also considering
rolling out Oracle Human Resources and Oracle Asset Management in the
future.

Reduced Training Costs

Air India used the first group of trainees to tutor their colleagues on the Oracle
system, reducing overall training costs. The staff didn’t just train them on the
actual use of the application but also showed them how the integrated Oracle
ERP solution works. They provided background information on the system that
may not be immediately visible to the end user, satisfying users’ curiosity as to
why certain processes happened in a particular way.

Why Oracle?

Air India was not aware of any other organizations in India that provided the
comprehensive training in Oracle technology that it was looking for. As it was
the first time the airline had used Oracle, it was important to gain a thorough
understanding of the capabilities of the software.

The airline believes any organization that wants training in Oracle technology
should consider Oracle University as a first option. It said external
organizations may provide similar training but they will not have the same
depth of knowledge as the vendor, adding that its experience with Oracle
University has been excellent.

Advice from Air India

Provide training before deploying any new systems. This will give staff a basic
understanding of the technology so they can use and maintain the system as
soon as it goes live.

Invite Oracle University personnel to review the system you have set up,
especially those areas in which the application has been tailored to your needs.
This will enable them to provide more focused training in the applications.

Ensure you receive technical training in live problem situations, so that your
staff is aware of methods to solve them, based on Oracle’s knowledge bank.
 INTRODUCTION TO ERP
ERP, which is an abbreviation for Enterprise Resource Planning, is principally an
integration of business management practices and modern technology.
Information Technology (IT) integrates with the core business processes of a
corporate house to streamline and accomplish specific business objectives.
Consequently, ERP is an amalgamation of three most important components;
Business Management Practices, Information Technology and Specific Business
Objectives.

In simpler words, an ERP is a massive software architecture that supports the

streaming and distribution of geographically scattered enterprise wide
information across all the functional units of a business house. It provides the
business management executives with a comprehensive overview of the
complete business execution which in turn influences their decisions in a
productiveway.

At the core of ERP is a well managed centralized data repository which

acquires information from and supply information into the fragmented
applications operating on a universal computing platform.
Information in large business organizations is accumulated on various servers
across many functional units and sometimes separated by geographical
boundaries. Such information islands can possibly service individual
organizational units but fail to enhance enterprise wide performance, speed
and competence.

The term ERP originally referred to the way a large organization planned to use
its organizational wide resources. Formerly, ERP systems were used in larger
and more industrial types of companies. However, the use of ERP has changed
radically over a period of few years. Today the term can be applied to any type
of company, operating in any kind of field and of any magnitude.

Today's ERP software architecture can possibly envelop a broad range of

enterprise wide functions and integrate them into a single unified database
repository. For instance, functions such as Human Resources, Supply Chain
Management, Customer Relationship Management, Finance, Manufacturing
Warehouse Management and Logistics were all previously stand alone
software applications, generally housed with their own applications, database
and network, but today, they can all work under a single umbrella - the ERP
architecture.
In order for a software system to be considered ERP, it must provide a business
with wide collection of functionalities supported by features like flexibility,
modularity & openness, widespread, finest business processes and global
focus.

Integration is Key to ERP Systems

Integration is an exceptionally significant ingredient to ERP systems. The

integration between business processes helps develop communication and
information distribution, leading to remarkable increase in productivity, speed
and performance.

The key objective of an ERP system is to integrate information and processes

from all functional divisions of an organization and merge it for effortless
access and structured workflow. The integration is typically accomplished by
constructing a single database repository that communicates with multiple
software applications providing different divisions of an organization with
various business statistics and information.

Although the perfect configuration would be a single ERP system for an entire
organization, but many larger organizations usually deploy a single functional
system and slowly interface it with other functional divisions. This type of
deployment can really be time-consuming and expensive.

The Ideal ERP System

An ERP system would qualify as the best model for enterprise wide solution
architecture, if it chains all the below organizational processes together with a
central database repository and a fused computing platform.

Manufacturing

Engineering, resource & capacity planning, material planning, workflow

management, shop floor management, quality control, bills of material,
manufacturing process, etc.

Financials

Accounts payable, accounts receivable, fixed assets, general ledger, cash

management, and billing (contract/service)
Human Resource

Recruitment, benefits, compensations, training, payroll, time and attendance,

labour rules, people management

Supply Chain Management

Inventory management, supply chain planning, supplier scheduling, claim

processing, sales order administration, procurement planning, transportation
and distribution

Projects

Costing, billing, activity management, time and expense

Customer Relationship Management

Sales and marketing, service, commissions, customer contact and after sales
support

Data Warehouse

Generally, this is an information storehouse that can be accessed by

organizations, customers, suppliers and employees for their learning and
orientation

ERP Systems Improve Productivity, Speed and Performance

Prior to evolution of the ERP model, each department in an enterprise had

their own isolated software application which did not interface with any other
system. Such isolated framework could not synchronize the inter-department
processes and hence hampered the productivity, speed and performance of
the overall organization. These led to issues such as incompatible exchange
standards, lack of synchronization, incomplete understanding of the enterprise
functioning, unproductive decisions and many more.

For example: The financials could not coordinate with the procurement team
to plan out purchases as per the availability of money.
Hence, deploying a comprehensive ERP system across an organization leads to
performance increase, workflow synchronization, standardized information
exchange formats, complete overview of the enterprise functioning, global
decision optimization, speed enhancement and much more.

Implementation of an ERP System

Implementing an ERP system in an organization is an extremely complex

process. It takes lot of systematic planning, expert consultation and well
structured approach. Due to its extensive scope it may even take years to
implement in a large organization. Implementing an ERP system will eventually
necessitate significant changes on staff and work processes. While it may seem
practical for an in-house IT administration to head the project, it is commonly
advised that special ERP implementation experts be consulted, since they are
specially trained in deploying these kinds of systems.

Organizations generally use ERP vendors or consulting companies to

implement their customized ERP system. There are three types of professional
services that are provided when implementing an ERP system, they are
Consulting, Customization and Support.

 Consulting Services - are responsible for the initial stages of ERP

implementation where they help an organization go live with their new
system, with product training, workflow, improve ERP's use in the
specific organization, etc.
 Customization Services - work by extending the use of the new ERP
system or changing its use by creating customized interfaces and/or
underlying application code. While ERP systems are made for many core
routines, there are still some needs that need to be built or customized
for a particular organization.
 Support Services - include both support and maintenance of ERP
systems. For instance, trouble shooting and assistance with ERP issues.

The ERP implementation process goes through five major stages which are
Structured Planning, Process Assessment, Data Compilation & Cleanup,
Education & Testing and Usage & Evaluation.

1. Structured Planning: is the foremost and the most crucial stage where an
capable project team is selected, present business processes are
studied, information flow within and outside the organization is
 scrutinized, vital objectives are set and a comprehensive implementation
plan is formulated.
2. Process Assessment: is the next important stage where the prospective
software capabilities are examined, manual business processes are
recognized and standard working procedures are constructed.
3. Data Compilation & Cleanup: helps in identifying data which is to be
converted and the new information that would be needed. The compiled
data is then analyzed for accuracy and completeness, throwing away the
worthless/unwanted information.
4. Education & Testing: aids in proofing the system and educating the users
with ERP mechanisms. The complete database is tested and verified by
the project team using multiple testing methods and processes. A broad
in-house training is held where all the concerned users are oriented with
the functioning of the new ERP system.
5. Usage & Evaluation: is the final and an ongoing stage for the ERP. The
lately implemented ERP is deployed live within the organization and is
regularly checked by the project team for any flaw or error detection.

Advantages of ERP Systems

There are many advantages of implementing an EPR system. A few of them are
listed below:

 A perfectly integrated system chaining all the functional areas together

 The capability to streamline different organizational processes and
workflows
 The ability to effortlessly communicate information across various
departments\
 Improved efficiency, performance and productivity levels
 Enhanced tracking and forecasting
 Improved customer service and satisfaction
Disadvantages of ERP Systems

While advantages usually outweigh disadvantages for most organizations

implementing an ERP system, here are some of the most common obstacles
experienced:

 The scope of customization is limited in several circumstances

 The present business processes have to be rethought to make them
synchronize with the ERP
 ERP systems can be extremely expensive to implement
 There could be lack of continuous technical support
 ERP systems may be too rigid for specific organizations that are either
new or want to move in a new direction in the near future.