Air India introduces new IT system for materials management

Mumbai: Air India today rolled out the replacement of its paper-based procurement process with an advanced supply chain management solution to simplify its Rs 700 crore procurement of over 30,000 items of inventory that have to be procured or replenished annually.

The roll-out of this Oracle supply chain solution, a module of Oracle ERP application, implemented by Satyam and managed by IBM Global Services, was completed in 10 months.

The new system, implemented a cost of Rs 5 crore, is expected to improve its per-unit procurement cost and also involve the participation of more vendors irrespective of their location. This is essential for a public sector undertaking like Air India, which is required to ensure multi-stage tendering. The tendering process, at times, leads to delay in procurement of key items, resulting in cost and time overruns.

V Thulasidas, chairman and managing director, Air India, says, "Having implemented ERP solution in the Materials Management Department, Air India now proposes to adopt such modern IT solutions across the company in a short and time-bound manner, particularly, as Air India is entering a phase of rapid growth".

Speaking about the implementation of the new system, Mr. Krishan Dhawan, MD, ORACLE India, said "The solution will enable Air India to streamline its essential supply chain processes and help in continuous business process improvement while future-proofing its IT system through the use of standardized IT infrastructure".

The new system will help break some of the barriers that exist in paper-based procurements, like dependence on specific buyers; inability to reach to all vendors regarding AI's requirements and procedural procurement delays.

The new system would also provide real-time information not only to all users within the carrier but also to its vendor companies and regulatory bodies in India and abroad.