CIOIN

Mohit Agarwal,

CIO, HT Media

Executive summary

HT Media's warehouses were full of money. If HT could slash its paper inventory, it could free up funds for expansion. A virtualization technology used for SAP, provided a formal system of inventory management. Project Light changed things around. HT media.

Money is just paper. Nowhere is that saying more true than in the newspaper business. Of the 15 million readers who pick up one of the 2.25 million copies of Hindustan Times, few know that 80 percent of the cost of producing that paper is the paper itself. But it's a figure that weighs heavily on the minds of HT Media's management. Mainly because they have millions of rupees worth of paper sitting around in their warehouses. Five years ago, HT Media's inventory of paper was worth Rs 150 crore - and they were making about Rs 550 crore. With such a large chunk of their funds wasting away in warehouses gathering dust, no picture of 'dead' money could have been more accurate.

The challenge before HT Media was to give its advertisers an audience that was spread out across multiple geographies and mediums. To do that, HT Media needed a lot of money. So it turned to the market. "In terms of asset management we were very poor. The controls were mainly manual, or local accounting packages used in different locations. We had no formal system of indenting, purchase order (PO), or GRN (goods removal note), which could give us a complete trail, the location, or the capitalization of fixed assets and transactions with the market," says Goel. There was a solution to all these problems: upgrading their ERP system. Going from SAP R/3 4.6C to SAP ECC6.0 would create accurate data, bring the organization on the same page and give it the sleek streamline of a professional enterprise.

But Sharad Saxena, executive director, operations & HR, HT Media, knew it was going to be a big move. The plan was to upgrade to SAP ECC 6.0 and extend the ERP's coverage from a few finance apps and media planning to the entire business.

So the upgrade, nicknamed Project Light, was kicked off in June 2006, with a team of 22 people from all the paper's departments and 23 members of SISL. "We have deployed a unique Fujitsu Netapps Flexframe architecture. It's basically a virtualization technology used for SAP. Project Light makes us the first media house in India to be on SAP ECC 6.0 deployed on SAP certified Flexframe 4.0. It's also the first major deployment of Flexframe 4.0 in the world," says Agarwal.

Most important on the implementation team's agenda was to identify alternate - even manual - processes for the 72 hours. At the same time, Agarwal and his team carried out dry runs of the changeover so that when the moment of actual change took place, it would take off uneventfully. D-Day came on 23 June 2007. And, it went by smoothly.

Today, SAP 6.0 binds 17 locations and 30 sales offices. The upgrade covers basically every module that was planned. Project Light took out multiple business problems. Inventory and procurement were among the biggest beneficiaries of the new, streamlined system. The new system has added hugely to process efficiency, thus driving intangible benefits in terms of reduction in wastage. Importantly, the media house has reduced its paper inventory to 30 days. It has also injected more grease into its presses. It made the department less cluttered and its staff more productive. It's also become easier to control the assets of the Rs 800 crore enterprise. And the IPO raised Rs 400 crore for the organization. HR too has reduced the number of days it takes to create payroll.