On "Market research and analysis of ERP for SME”

A Project Report

On "Market research and analysis of ERP for SME”
for "IOTA Technologies Ltd”

"Sarang S Sirdeshpande"

Under the guidance of
"Prof Smita Sovani "
Submitted to
"University of Pune"

In partial fulfillment of the requirement for the award of the degree of Master of Business
Administration (MBA)

Vishwakarma Institute of Management


It s a great privilege that I have done my project in such a well
organized and diversified organization. I am grateful to all those who helped
and supported me in completing the project.

First i would like to thank Mr. Shailesh Ghatpande ( Manager Busines solutions) and Mr Milind Patil for giving me an opportunity to work as a summer trainee in IOTA Technologies Ltd. And there by fulfilling the requirement of our MBA course.

I am also thankful to our director, Dr. Sharad Joshi and my project
guide Prof. Sovani and also to Prof. Doke for helping me in completing the project.
Last but not least, I am also thankful to all college staff and my friends for helping me directly or indirectly in project.


SR no Title Page no
1 Executive Summary 1
2 Objectives of the Study 3
3 Company Profile 5
4 Research work 10
5 Critical success factors 24
6 Theoretical framework 29
7 Analysis and interpretation of data 38
8 Findings 46
9 Suggestions & recommendations 49
10 Conclusion 50
11 Annexure 51
12 Bibliography 53

Chapter I
Executive Summary
ERP is no longer taboo for the SME, in fact as management guru C K Pralhad advocates; SME’s are the real case of “Fortune at the bottom of the pyramid” for the ERP Vendors
Since all the major MNC’s have already have an ERP system at place the obvious target market for ERP vendors (both Global and Local) is SME. In the recent past the manufacturing sector in general has seen some good days thanks to
 Effective government policies
 Outsourcing boom
 Strong European connections for technology up gradation ….. etc
This becomes enough justification to chase the manufacturing SMEs for the ERP Implementation by vendors.
With business becoming more competitive by the day, SMEs are looking to leverage technology and business applications. How ever the SME market has been slow to adopt technology, due to various reasons such as …
 Global ERP Vendors’ focus on the large corporations
 Unaffordable solutions by Global ERP Vendors for SMEs.
 Availability of customized applications and packages for different functions for SME, such as accounting or capacity planning etc
This resulted in “islands of information”. These applications could not scale to match the SME’s growth, leading to disillusionment with IT.
The SME , thus find them selves clutches between the age old jaw of price vs. quality .
While the global vendors claim to have “Best Practices” in their kitty they come at considerable price. There are some issues with the global vendor which might not necessarily fit in the limits of SME. At this point global giants like SAP and ORACLE have come up with exclusive suit for SME and claim to be far more cost effective at the SME price band level.
On the other hand Local vendors claim to understand local business practices better than the global vendors. They can offer greater service (perceived to be) and negotiable price within the band of SME. One additional advantage they enjoy due to their flexible offering in customization of product.
With software becoming more and more standardized and the building cost of the software going down, it is functional expertise that will differentiate between successful and failed ERP Implementation. Thus the understanding of Business Processes is the key.
Essential offerings for SME:
 A comprehensive suite of applications tightly integrated with all major ,essential applications.
 Rapid, low-cost implementation critical as delays or long implementation times adversely impact the business .
 Flexible pricing, packaging and deployment options that allow the SME to scale up the business applications implemented as per business requirements .
 Internet and wireless device accessibility - essential given the speed of business and the need for anywhere, anytime access .
 Local consulting /implementation support - critical as SMEs typically do not have enough technical resources.

This project attempts to small and medium scale enterprises. This includes study the potential of SME segment for ERP solution. IOTA TECHNOLOGIES gives me opportunity to study the working of SME and their need to have ERP solutions. I have conducted this survey Pune and nearby industrial estate.

Chapter II
Objective of the Study:
This projects attempts to understand the local ERP market in the geographical region of Pune MIDC in the manufacturing sector. Since the manufacturing industry has seen good days off late , due to various reasons such as strong government support in terms of policy making , out sourcing trends, local manufacturers’ European connections , the sector is going big way in ERP Implementation. Thus it becomes essential to focus the project on manufacturing industry.

As the above diagram suggests, the SME today has a number of business management solutions at its disposal to give it a competitive edge in its industry. However, it needs to critically evaluate the options available on the parameters above to ensure that its IT investment will remain productive in the future too, or else face the prospect of ending up with a drain on its resources in the longer run.

The study entitled “Market Research of ERP” was carried out:
 To assess current market scenario of ERP.
 To identify key competitors in the market.
 To determine potential market for ERP Users.
 To estimate the accessible market for Sixth Sense -ERP.
 To give suggestions if any.
 To compare available ERP package with buyer’s expectations

One important aspect of this project is also to take in to account the ERP Vendors perspective and give it a square view. The vendors in this case are local vendors caterings to SME sector


The scope of the study focuses on the “Market Research conducted in Belgaum Industrial Estate”, for identifying the business opportunities for the iota technologies ltd, Pune.

In this study in depth analysis of the business segment, annual turnover, employee strength and the probability to adapt the ERP package in future is made.

The study also includes identification of probable customers in this area for the ERP package on the basis of standard criteria laid down by the company.

Chapter III


Iota technologies limited is a company involved in development of innovative software solutions and has established its reputation as an intelligent business solutions company in a cross section of industries including manufacturing, sales, distribution and service sector.
Iota is a leading provider of Enterprise Resource Planning (ERP) system for the manufacturing, sales and distribution industries.

Setup –
The software development centre and corporate office is located at Pune. A hundred member team possessing skills in diverse technologies and platforms works under stringent quality requirements.
Internet based project & quality management software handles the complete process of project planning, work distribution, task monitoring, timesheets, quality assurance, release management and defect tracking.
Windows, Linux networks, web servers hosted with various ISPs and dedicated high-speed internet connection cater to application development and testing requirements of various project groups.
The support centers at Mumbai, New Delhi, Nagpur and Chennai understand customer requirements and provide implementation, customization and customer support.

Functional Skills –
Providing end-to-end solutions for manufacturing, sales, and distribution and logistics functions has been iota’s core business since inception.
Many electronics, engineering, auto components, chemical, garments, transport, warehousing, retailing, food, pharmaceutical sector companies have been serviced by iota.

Product Profile

Iota offers technology solutions in three areas;
 Offshore,
 Industrial and
 Business intelligence.

At the spearhead is the Business Intelligence Group which services a wide range of customers both in India and abroad.
The Sixth Sense: A Business Solutions Suite
As business issues are becoming increasingly complex, more and more decision makers today, require a tool that increases their ability to make the right decisions to meet their business goals.

Built to understand and combat the potential effects of the complexities faced by an enterprise, Business Solutions from iota remain aligned with the primary goal of the organization; help achieve more profits now and in the future.

The Sixth Sense suite of Business Solutions is a family of Information Technology based solutions that enable manufacturing, sales and distribution organizations take complete control of their operations.

The solution delivery approach includes application of scientific methods to understand and structure complex business problems and deliver practical solutions through:

Business Process Analysis:
It brings the technical and functional feasibility of the solutions to customers as they consider new technologies and look for industry-specific IT solutions. In this early phase of the IT cycle, the focus is on deciding the critical areas requiring IT investments and how to maximize value from information technology.

Business Intelligence Solutions:
It determines how best to develop the software from iota’s pool of business components, integrate new and existing technologies and implement the right solution. The solutions put emphasis on transforming the selected functions and technologies into long-term business value.

The methodology ensures that the system is put to use quickly and smoothly. It ensures that the enterprise gets the benefits of the best practices that have been embedded in the system.

Support Services:
The focus is on the IT phase in which customers need to keep their mission-critical systems operating smoothly. Support services assist in the long-term support of our customers’ systems, with varying levels according to specific needs. These services help customers maximize the investment they've previously made in their systems.

Some of the leading customers

Name of the Company Area of Operations
• Sansui Electronics Pvt. Limited Weighing Scales
• Schenectady Beck India Limited Chemicals
• Vanaz Engineering Gas dispensing Machines/ Kit
• Ador powetron Lte HCR/HVR
• MRC India Limited Transport
• Kishor Pumps Pumps
• Syngenta India Limited (Novartis Group) Seed Division
• Foods on Net Pvt. Limited Application Service Provider
• Rajratan Gustav Wolf Limited Special Steel Wires
• Proline Exports Limited Garments
• Shamrock B. V. (Netherlands) Garment Manufacturer for FILA
• SAR Silicon Systems Pvt. Ltd. Sales and Distribution
• DGP Hinoday Auto Components
• Luminous India Limited Home power appliances
• Pune Metagraph Auto components
• Minilec industries Industrial products

Chapter IV
Research work
What is ERP?
Enterprise resource planning software, or ERP, doesn't live up to its acronym. Forget about planning—it doesn't do much of that—and forget about resource, a throwaway term. But remember the enterprise part. This is ERP's true ambition. It attempts to integrate all departments and functions across a company onto a single computer system that can serve all those different departments' particular needs.
That is a tall order, building a single software program that serves the needs of people in finance as well as it does the people in human resources and in the warehouse. Each of those departments typically has its own computer system optimized for the particular ways that the department does its work. But ERP combines them all together into a single, integrated software program that runs off a single database so that the various departments can more easily share information and communicate with each other.
That integrated approach can have a tremendous payback if companies install the software correctly.
Take a customer order, for example. Typically, when a customer places an order, that order begins a mostly paper-based journey from in-basket to in-basket around the company, often being keyed and re keyed into different departments' computer systems along the way. All that lounging around in in-baskets causes delays and lost orders, and all the keying into different computer systems invites errors. Meanwhile, no one in the company truly knows what the status of the order is at any given point because there is no way for the finance department, for example, to get into the warehouse's computer system to see whether the item has been shipped. "You'll have to call the warehouse" is the familiar refrain heard by frustrated customers.
ERP vanquishes the old standalone computer systems in finance, HR, manufacturing and the warehouse, and replaces them with a single unified software program divided into software modules that roughly approximate the old standalone systems. Finance, manufacturing and the warehouse all still get their own software, except now the software is linked together so that someone in finance can look into the warehouse software to see if an order has been shipped. Most vendors' ERP software is flexible enough that you can install some modules without buying the whole package. Many companies, for example, will just install an ERP finance or HR module and leave the rest of the functions for another day.

How can ERP improve a company's business performance?
ERP's best hope for demonstrating value is as a sort of battering ram for improving the way your company takes a customer order and processes it into an invoice and revenue—otherwise known as the order fulfillment process. That is why ERP is often referred to as back-office software. It doesn't handle the up-front selling process (although most ERP vendors have recently developed CRM software to do this); rather, ERP takes a customer order and provides a software road map for automating the different steps along the path to fulfilling it. When a customer service representative enters a customer order into an ERP system, he has all the information necessary to complete the order (the customer's credit rating and order history from the finance module, the company's inventory levels from the warehouse module and the shipping dock's trucking schedule from the logistics module, for example).
People in these different departments all see the same information and can update it. When one department finishes with the order it is automatically routed via the ERP system to the next department. To find out where the order is at any point, you need only log in to the ERP system and track it down. With luck, the order process moves like a bolt of lightning through the organization, and customers get their orders faster and with fewer errors than before. ERP can apply that same magic to the other major business processes, such as employee benefits or financial reporting.
That, at least, is the dream of ERP. The reality is much harsher.

The diagram bellow states the ERP’s role in an Organization in inter connectivity of the functions.

Let's go back to those inboxes for a minute. That process may not have been efficient, but it was simple. Finance did its job, the warehouse did its job, and if anything went wrong outside of the department's walls, it was somebody else's problem. Not anymore. With ERP, the customer service representatives are no longer just typists entering someone's name into a computer and hitting the return key. The ERP screen makes them businesspeople. It flickers with the customer's credit rating from the finance department and the product inventory levels from the warehouse. Will the customer pay on time? Will we be able to ship the order on time? These are decisions that customer service representatives have never had to make before, and the answers affect the customer and every other department in the company. But it's not just the customer service representatives who have to wake up. People in the warehouse who used to keep inventory in their heads or on scraps of paper now need to put that information online. If they don't, customer service reps will see low inventory levels on their screens and tell customers that their requested item is not in stock. Accountability, responsibility and communication have never been tested like this before.
People don't like to change, and ERP asks them to change how they do their jobs. That is why the value of ERP is so hard to pin down. The software is less important than the changes companies make in the ways they do business. If you use ERP to improve the ways your people take orders, manufacture goods, ship them and bill for them, you will see value from the software. If you simply install the software without changing the ways people do their jobs, you may not see any value at all—indeed, the new software could slow you down by simply replacing the old software that everyone knew with new software that no one does.

How long will an ERP project take?
Companies that install ERP do not have an easy time of it. Don't be fooled when ERP vendors tell you about a three or six month average implementation time. Those short (that's right, six months is short) implementations all have a catch of one kind or another: The company was small, or the implementation was limited to a small area of the company, or the company used only the financial pieces of the ERP system (in which case the ERP system is nothing more than a very expensive accounting system). To do ERP right, the ways you do business will need to change and the ways people do their jobs will need to change too. And that kind of change doesn't come without pain. Unless, of course, your ways of doing business are working extremely well (orders all shipped on time, productivity higher than all your competitors, customers completely satisfied), in which case there is no reason to even consider ERP.
The important thing is not to focus on how long it will take—real transformational ERP efforts usually run between one and three years, on average—but rather to understand why you need it and how you will use it to improve your business.

What will ERP fix in my business?
There are five major reasons why companies undertake ERP.
1. Integrate financial information—As the CEO tries to understand the company's overall performance, he may find many different versions of the truth. Finance has its own set of revenue numbers, sales has another version, and the different business units may each have their own version of how much they contributed to revenues. ERP creates a single version of the truth that cannot be questioned because everyone is using the same system.
2. Integrate customer order information—ERP systems can become the place where the customer order lives from the time a customer service representative receives it until the loading dock ships the merchandise and finance sends an invoice. By having this information in one software system, rather than scattered among many different systems that can't communicate with one another, companies can keep track of orders more easily, and coordinate manufacturing, inventory and shipping among many different locations at the same time.
3. Standardize and speed up manufacturing processes—Manufacturing companies—especially those with an appetite for mergers and acquisitions—often find that multiple business units across the company make the same widget using different methods and computer systems. ERP systems come with standard methods for automating some of the steps of a manufacturing process. Standardizing those processes and using a single, integrated computer system can save time, increase productivity and reduce head count.
4. Reduce inventory—ERP helps the manufacturing process flow more smoothly, and it improves visibility of the order fulfillment process inside the company. That can lead to reduced inventories of the stuff used to make products (work-in-progress inventory), and it can help users better plan deliveries to customers, reducing the finished good inventory at the warehouses and shipping docks. To really improve the flow of your supply chain, you need supply chain software, but ERP helps too.
5. Standardize HR information— especially in companies with multiple business units, HR may not have a unified, simple method for tracking employees' time and communicating with them about benefits and services. ERP can fix that.
In the race to fix these problems, companies often lose sight of the fact that ERP packages are nothing more than generic representations of the ways a typical company does business. While most packages are exhaustively comprehensive, each industry has its quirks that make it unique. Most ERP systems were designed to be used by discrete manufacturing companies (that make physical things that can be counted), which immediately left all the process manufacturers (oil, chemical and utility companies that measure their products by flow rather than individual units) out in the cold. Each of these industries has struggled with the different ERP vendors to modify core ERP programs to their needs.

What are the hidden costs of ERP?
Although different companies will find different land mines in the budgeting process, those who have implemented ERP packages agree that certain costs are more commonly overlooked or underestimated than others. Armed with insights from across the business, ERP pros vote the following areas as most likely to result in budget overrun.
1. Training - Training is the near-unanimous choice of experienced ERP implementers as the most underestimated budget item. Training expenses are high because workers almost invariably have to learn a new set of processes, not just a new software interface. Worse, outside training companies may not be able to help you. They are focused on telling people how to use software, not on educating people about the particular ways you do business. Prepare to develop a curriculum yourself that identifies and explains the different business processes that will be affected by the ERP system. One enterprising CIO hired staff from a local business school to help him develop and teach the ERP business-training course to employees. Remember that with ERP, finance people will be using the same software as warehouse people and they will both be entering information that affects the other. To do this accurately, they have to have a much broader understanding of how others in the company do their jobs than they did before ERP came along. Ultimately, it will be up to your IT and businesspeople to provide that training. So take whatever you have budgeted for ERP training and double or triple it up front. It will be the best ERP investment you ever make.
2. Integration and testing - Testing the links between ERP packages and other corporate software links that have to be built on a case-by-case basis is another often-underestimated cost. A typical manufacturing company may have add-on applications from the major—e-commerce and supply chain—to the minor—sales tax computation and bar coding. All require integration links to ERP. If you can buy add-ons from the ERP vendor that is pre-integrated, you're better off. If you need to build the links yourself, expect things to get ugly. As with training, testing ERP integration has to be done from a process-oriented perspective. Veterans recommend that instead of plugging in dummy data and moving it from one application to the next, run a real purchase order through the system, from order entry through shipping and receipt of payment—the whole order-to-cash banana—preferably with the participation of the employees who will eventually do those jobs.
3. Customization - Add-ons are only the beginning of the integration costs of ERP. Much more costly, and something to be avoided if at all possible, is actual customization of the core ERP software itself. This happens when the ERP software can't handle one of your business processes and you decide to mess with the software to make it do what you want. You're playing with fire. The customizations can affect every module of the ERP system because they are all so tightly linked together. Upgrading the ERP package—no walk in the park under the best of circumstances—becomes a nightmare because you'll have to do the customization all over again in the new version. Maybe it will work, maybe it won't. No matter what, the vendor will not be there to support you. You will have to hire extra staffers to do the customization work, and keep them on for good to maintain it.
4. Data conversion - It costs money to move corporate information, such as customer and supplier records, product design data and the like, from old systems to new ERP homes. Although few CIOs will admit it, most data in most legacy systems is of little use. Companies often deny their data is dirty until they actually have to move it to the new client/server setups that popular ERP packages require. Consequently, those companies are more likely to underestimate the cost of the move. But even clean data may demand some overhaul to match process modifications necessitated—or inspired—by the ERP implementation.
5. Data analysis - Often, the data from the ERP system must be combined with data from external systems for analysis purposes. Users with heavy analysis needs should include the cost of a data warehouse in the ERP budget—and they should expect to do quite a bit of work to make it run smoothly. Users are in a pickle here: Refreshing all the ERP data every day in a big corporate data warehouse is difficult, and ERP systems do a poor job of indicating which information has changed from day to day, making selective warehouse updates tough. One expensive solution is custom programming. The upshot is that the wise will check all their data analysis needs before signing off on the budget.
6. Consultants ad infinitum - When users fail to plan for disengagement, consulting fees run wild. To avoid this, companies should identify objectives for which its consulting partners must aim when training internal staff. Include metrics in the consultants' contract; for example, a specific number of the user company's staff should be able to pass a project-management leadership test—similar to what Big Five consultants have to pass to lead an ERP engagement.
7. Replacing your best and brightest - It is accepted wisdom that ERP success depends on staffing the project with the best and brightest from the business and IS divisions. The software is too complex and the business changes too dramatic to trust the project to just anyone. The bad news is a company must be prepared to replace many of those people when the project is over. Though the ERP market is not as hot as it once was, consultancies and other companies that have lost their best people will be hounding yours with higher salaries and bonus offers than you can afford—or that your HR policies permit. Huddle with HR early on to develop a retention bonus program and create new salary strata for ERP veterans. If you let them go, you'll wind up hiring them—or someone like them—back as consultants for twice what you paid them in salaries.
8. Implementation teams can never stop - Most companies intend to treat their ERP implementation as they would any other software project. Once the software is installed, they figure the team will be scuttled and everyone will go back to his or her day job. But after ERP, you can't go home again. The implementers are too valuable. Because they have worked intimately with ERP, they know more about the sales process than the salespeople and more about the manufacturing process than the manufacturing people. Companies can't afford to send their project people back into the business because there's so much to do after the ERP software is installed. Just writing reports to pull information out of the new ERP system will keep the project team busy for a year at least. And it is in analysis—and, one hopes, insight—that companies make their money back on an ERP implementation. Unfortunately, few IS departments plan for the frenzy of post-ERP installation activity, and fewer still build it into their budgets when they start their ERP projects. Many are forced to beg for more money and staff immediately after the go-live date, long before the ERP project has demonstrated any benefit.
9. Waiting for ROI - One of the most misleading legacies of traditional software project management is that the company expects to gain value from the application as soon as it is installed, while the project team expects a break and maybe a pat on the back. Neither expectation applies to ERP. Most of the systems don't reveal their value until after companies have had them running for some time and can concentrate on making improvements in the business processes that are affected by the system. And the project team is not going to be rewarded until their efforts pay off.
10. Post-ERP depression - ERP systems often wreak cause havoc in the companies that install them. In a recent Deloitte Consulting survey of 64 Fortune 500 companies, one in four admitted that they suffered a drop in performance when their ERP system went live. The true percentage is undoubtedly much higher. The most common reason for the performance problems is that everything looks and works differently from the way it did before. When people can't do their jobs in the familiar way and haven't yet mastered the new way, they panic, and the business goes into spasms.

Why do ERP projects fail so often?
At its simplest level, ERP is a set of best practices for performing different duties in your company, including finance, manufacturing and the warehouse. To get the most from the software, you have to get people inside your company to adopt the work methods outlined in the software. If the people in the different departments that will use ERP don't agree that the work methods embedded in the software are better than the ones they currently use, they will resist using the software or will want IT to change the software to match the ways they currently do things. This is where ERP projects break down. Political fights break out over how—or even whether—the software will be installed. IT gets bogged down in long, expensive customization efforts to modify the ERP software to fit with powerful business barons' wishes. Customizations make the software more unstable and harder to maintain when it finally does come to life. The horror stories you hear in the press about ERP can usually be traced to the changes the company made in the core ERP software to fit its own work methods. Because ERP covers so much of what a business does, a failure in the software can bring a company to a halt, literally.
But IT can fix the bugs pretty quickly in most cases, and besides, few big companies can avoid customizing ERP in some fashion—every business is different and is bound to have unique work methods that a vendor cannot account for when developing its software. The mistake companies make is assuming that changing people's habits will be easier than customizing the software. It's not. Getting people inside your company to use the software to improve the ways they do their jobs is by far the harder challenge. If your company is resistant to change, then your ERP project is more likely to fail.
How does ERP fit with e-commerce?
ERP vendors were not prepared for the onslaught of e-commerce. ERP is complex and not intended for public consumption. It assumes that the only people handling order information will be your employees, who are highly trained and comfortable with the tech jargon embedded in the software. But now customers and suppliers are demanding access to the same information your employees get through the ERP system—things like order status, inventory levels and invoice reconciliation—except they want to get all this information simply, without all the ERP software jargon, through your website.
E-commerce means IT departments need to build two new channels of access in to ERP systems—one for customers (otherwise known as business-to-consumer) and one for suppliers and partners (business-to-business). These two audiences want two different types of information from your ERP system. Consumers want order status and billing information, and suppliers and partners want just about everything else.
Traditional ERP vendors are having a hard time building the links between the Web and their software, though they certainly all realize that they must do it and have been hard at work at it for years. The bottom line, however, is that companies with e-commerce ambitions face a lot of hard integration work to make their ERP systems available over the Web. For those companies that were smart—or lucky—enough to have bought their ERP systems from a vendor experienced in developing e-commerce wares, adding easily integrated applications from that same vendor can be a money-saving option. For those companies whose ERP systems came from vendors that are less experienced with e-commerce development, the best—and possibly only—option might be to have a combination of internal staff and consultants hack through a custom integration.
But no matter what the details are, solving the difficult problem of integrating ERP and e-commerce requires careful planning, which is key to getting integration off on the right track.
One of the most difficult aspects of ERP and e-commerce integration is that the Internet never stops. ERP applications are big and complex and require maintenance. The choice is stark if ERP is linked directly to the Web—take down your ERP system for maintenance and you take down your website. Most e-commerce veterans will build flexibility into the ERP and e-commerce links so that they can keep the new e-commerce applications running on the Web while they shut down ERP for upgrades and fixes.
The difficulty of getting ERP and e-commerce applications to work together—not to mention the other applications that demand ERP information such as supply chain and CRM software—has led companies to consider software known alternately as middleware and EAI software. These applications act as software translators that take information from ERP and convert it into a format that e-commerce and other applications can understand. Middleware has improved dramatically in recent years, and though it is difficult to sell and prove ROI on the software with business leaders—it is invisible to computer users—it can help solve many of the biggest integration woes that plague IT these days.

Salient features of ERP as observed in diff companies:
1. Inter companies integration
2. Inter departmental integration
3. Effective utilization of available resources
4. Lower costs incurred due to better planning ( e.g. inventory caring cost going down because of planning)
5. Customer satisfaction due to correct delivery schedule
6. Avoiding duplicity of work
7. Increased efficiency due to simple and fast work
8. Process standardization
9. Less person specific work and more system oriented work
10. Grater control in terms of rules and methodologies to be followed
11. Wide acceptance
12. Knowledge of world class best practices and new direction to it
13. Covering firm’s value chain
14. Industry specific
15. Bringing new perspective in terms of web based interaction with client
16. e-biz orientation

1. Availability skilled work force
2. Availability of adequate training budget
3. High cost of package and implementation and post implementation service or maintenance
4. Usual delay in implementation
5. Attrition
6. Change in age old business practice
7. Mind set issues of employee
8. Difficulty in adapting to new system (‘weakest link’ problem)
9. Extra amount of work that had to be done in the initial phase
10. Change in organizational structure , hierarchy
11. Service (dependability on the vendor for solving even small problems )
12. Data migration from legacy to contemporary system ( compatibility issues)
13. High switching costs

Project Risk factors:
 Project Size
 Experience with technology
 Project structure
 Stability of implementation group
 Strategic relevance of the system to be deployed
 No of new users to the system

Critical Success Factors

As the above graph suggests the productivity may dip during the initial period of implementation but at the later time instance it gradually stabilizes at the higher productivity.
Thus the key factors and relatively important to ERP implementation for the client companies are as follows
 Cost of the product ( TCO)
 Process mapping
 Business Process Reengineering ( BPR)
 Consultancy for selection of hard ware and connectivity solution
 Feed back from vendors , suppliers , clients
 Service
 Implementation period



Research means scientific and systematic search for pertinent information on a specific topic. Research comprises of defining and redefining problems, formulating hypotheses, collecting, organizing and evaluating data, making deductions and reaching conclusions. The last step could involve carefully deductions and reaching conclusions. The last step could involve carefully testing the conclusions to determine whether they fit the formulated hypothesis.

After going through a short interactive program about the product, the problem areas & the desired objectives of the study were identified; the research methodology was prepared based on the questionnaire provided.

Research methodology is a way to systematically solve the research problems. It may understand as a science of studying how research is done scientifically. In it we study the various steps that are generally adopted by researcher in studying his research problem along with logic behind him.

There are several ways of collecting the data, which differ considerably in context of money, time and other resources at the disposal of researcher.

There are mainly two types of data: -

a) Primary Data.
b) Secondary Data

Primary Data: -
The primary data is that data that is collected as fresh and for the first time and thus happens to be original in nature. In order to achieve the above set of objectives the researcher for collecting the data uses “Survey Method”.
A market survey was conducted in the Pune & near by industrial Estate for collecting the data by administrating a structured questionnaire, personal interviews and in some cases telephonic interviews were also conducted.
For the purpose of conducting interviews an interview Guide was prepared, which made it quite easier for the interviewer to collect all relevant information needed for the researcher.
The structure and the contents of this interview Guide are as follows: -

Interview Guide: -
The first four fields in the SIF viz.
• Name of the company
• Address
• Tel. No. And
• Email and website are imperative and should be enquired about, preferably, at the Reception/ Security and not from the concerned person.
The field Name of the contact person and his designation are leads that convert our cold call to warm one. It should be emphasized here, that availability of the Name of the concerned person, saves lot of time and effort while perusing the cold call, in the sense that we get a clear picture of the status of organization as regards to ERP in one shot.

Building Company profile

 Is there EDP department in the firm?
 Who is the person responsible for software/ computer related issues?
 Who looks after the Accounts or Purchase department?
 To get to the concerned person
 What is the end product?
 What are the operations involved?

The business segment can be decided based on the end product and operations involved.

 What is the type of manufacturing?
 Work center based, processes, assembly, job work etc. will help gauging the requirements of the firm for manufacturing and its sub modules.
 What are the other departments in the firm?
 What are the software’s used in Purchase/ Inventory/ Manufacturing etc. departments?
 How invoicing is carried out?
 What are the other operations, which are still carried manually?

To identify the decision taker, if the firm holds the need and capacity to buy an ERP.
 What is the overall attitude of the company towards automation/ IT/ computers?
 Will explain the present level of automation, and help in tracing the attitude of the organization towards automation and IT related requirements in future
 How is the performance of the software’s used?
 Do the existing systems satisfy your needs?
 Will it make a change if systems are integrated?
 If you are to make an IT related investment, who is the decision maker?
 Who needs to be contacted to know whether you would go for an ERP system or not?

Will help in estimating the magnitude of the organization.

 Whom do you supply to?
 What is the mode of distribution of product?
 Through distribution network, suppliers to a single firm etc.
 What is the number of employees?

Parameters that will partly decide their capacity to buy/ invest in IT related products/ services.

 What are the locations of other units, if any?
 Use of Net sync.
 Who is in charge of other units? What is the group turn over?
 What is the annual turn over/ range of turnover of the firm?

Competitor’s information

 What is the profile of the vendor who supplies/ ed the present software?
 What are the software/ automation requirements of the firm in future?

Secondary Data: -
The secondary data is that which already exists and has been collected and analyzed by someone else for some other purpose but it is also useful for our present study.
Here the secondary data is collected through the literature available from the company records, websites ands by referring magazines, reference books, journals etc.

Research process:
The marketing research process that was used involves following processes: -
1. Define the research objectives and problem areas
2. Develop the Research Plan
3. Collect the information
4. Analyze the information
5. Present the findings
6. Make the recommendations and conclusion



Marketing research are the collection, analysis and interpretation of facts and figures pertaining to marketing management. The management must exercise a prudent judgment in formulating courses of action based on the above research. is the systematic objective and exhaustive search for the study of facts relevant to any problem in the field of marketing. Marketing research is considered all persuasive, as its utility has been in all areas of management. It uses scientific methods of gathering, recording, analyzing reporting of facts and figures relating to the flow of goods and services from producer to consumers.
Marketing research provides intelligence, analysis and information of the marketing mix and its environments. It covers the entire management process and is not concentrated only on the market. The marketing mix e.g. price, product, promotion and distribution are internal factors, which are the basis of marketing research. The economic environment, competitive and technological environment, political and legal environment, cultural and social environment are analyzed in the objectively of intended resources and objectives of firms to find out suitable measures and to manage firms effectively to get the objectives fulfilled.


According to Cundiff & Still, “ Marketing Research is the systematic gathering, recording and analysis of data about marketing problems to facilitate decision making.”

According to Philip Kotler, “ Marketing Research is the systematic design, collection, analysis and reporting of data and findings relevant to a specific marketing situation facing the company.”

The American Marketing Associations has defined marketing research as the, “ Systematic gathering, recording and analyzing of data about problems relating to the marketing goods services.”

The nature of marketing research is analyzed in relation to its objectives.
Objectives: -
Marketing research as an integral part of the marketing information system is used in decision-making process.
1. Planning: - Marketing research is used for the formulation and evaluation of planning and its customers.
2. Minimizing costs: - The marketing costs, particularly selling, advertising and the promotion and distribution cost can be reduced with the help of marketing research. Research brings market closer to the consumers and reduces several costs of distribution.
3. Problem solving: -The main purpose of marketing research is to solve problems relating to product, price, promotion, competition and distribution of goods and services.
4. Survival and Growth: - Marketing research is used for the growth and survival of firms. It assesses competitive strength and policies, estimates potential buying power, a firm’s share of the market, and provides suitable information for appropriate decisions.
5. Assess the Marketing: - Marketing research finds out the actual position of marketing and the present trend of management. It assesses the present and probable volume of future sales.
6. Introduction to New Product: -Before introducing a new product, the market research is used to find out suitable avenues and place of the new products. It reveals the various opportunities of new markets and reveals the methods to reach the markets.
7. Market Orientation: -The objective of marketing research is to enable the firms to produce the goods and services acceptable to the customers. It sees the goods and services must reach the market easily, quickly, cheaply and profitably. The right course of action to approach and sustain the market is possible with the suitable marketing research.


The main characteristics are as follows: -
1. Application of Scientific Methods: - Marketing research will be useful and effective if scientific methods are applied for collection, analysis and interpretation of data. Mario Bunge has suggested eight steps of scientific methods in research: -
• Ask well-formulated and likely fruitful questions.
• Devise hypothesis both grounded and testable to answer the questions.
• State the assumptions.
• Derive logical consequences of the assumptions.
• Design techniques to test the assumptions.
• Test the techniques for the relevance and reliability.
• Execute the tests and interpret their results.
• Evaluate the truth claims of the assumptions and of the techniques.
2. Research Creating: - The marketing research is limited not only to mere description of the facts and figures, but goes beyond that to explain the cause and consequences. It suggests some suitable measures to minimize the problems or to avoid problems. It should create additional facts, which have favorable consequences on the market.

3. Cost And Benefits: -The cost of marketing research must not exceed the benefits derived from the use of the findings of marketing research. The cost benefit analysis of various types of marketing research will determine which type of research project should be used to conduct the research for the benefits of marketing management.

4. Use of Models and Data: -Statistical methods are used to analyze the information. Good marketing research uses the statistical bank and model bank. The statistical bank is a collection of statistical procedures for extracting meaningful information from data and model bank is a collection of models and data makes the marketing research fruitful and purposive research.
5. Alternative Courses Of Action: -Sound marketing research finds out several alternative courses of action. The best course of action is applied in marketing management to attain the target. The validity of each course of action is evaluated before its application to marketing management. When a marketing manager chooses courses of action he can rarely be certain of the consequences of each course of action. Good marketing research comes to his rescue and suggests the best course of action from the angle of the objectivity of the management.

6. Uses of Specialist Services: - Sound marketing research uses the services of research specialists. The specialist may be from within the business or from outside. The line management has neither sufficient time nor expertise to acquire marketing research. This is the reason the management employs experts in the area of marketing research for its management decisions. The specialists will use scientific methods in all areas of marketing management.

7. Precautions in Marketing Research: -Sound marketing research makes use of some precautions to make the research findings as fruitful and relevant for marketing management decisions. The researcher avoids intruding his own bias and asking for irrelevant information. He has to apply different technical knowledge and expertise, spirit of research, relevant sample, right variables, required accuracy in collections and analysis and interpretation of data. He has to avoid ascribing beliefs and emotions in the procedures, methods and techniques of marketing.

Effective Marketing Research involves the five steps which are as follows: -
1. Defining the problem and research objectives.
2. Developing the research plan.
3. Collecting the information.
4. Analyzing the information.
5. Presenting the findings.


The first step of marketing research is to define the problem carefully & agree on the research objectives.
A well-defined problem is half solved. The problem must be defined in an appropriate manner. It should not be defined too broadly or too narrowly. After defining the problem, the objectives should be specified.

There are three types of research projects: -
A. Exploratory Research Project: - To gather preliminary data to enlighten the real nature of the problems and also suggest possible statements.

B. Descriptive Research: - To gather information about certain magnitudes of the problem.
C. Casuals Research: - to test the cause & its relationship in the problem.


The second stage of marketing research is developing the most efficient plan for gathering the needed information.
The researcher needs to posses the skills to design the research approach. Thorough knowledge about the causes is essential to evaluate the research plan & its findings.

Designing a research plan calls for decisions on the following: -

1. Data Sources.
2. Research Approaches.
3. Research Instruments.
4. Sampling Plan.
5. Contact Methods.

A] Data Sources: -

The research plan can call for gathering primary data. Primary data consists of original information gathering for the specific purpose.
Secondary data consists of information that already exists somewhere, having been collected for another purpose.
Researchers usually start their investigation by examining secondary data, to see whether the problem can be partly or wholly solved out, as collecting primary data is time consuming and costly process.
Secondary data provides a starting point for the research and has the advantage of low cost & ready availably.

If this secondary data doesn’t exists, or the existing data Is out-dated, inaccurate, incomplete or unreliable, then it is essential to collect primary data even at the greater cost for more relevancy & accuracy.

B] Research Approaches: -

Primary data can be collected in four ways: -

I] Observational Research: -

Fresh data can be gathered by observing the relevant facts. Observation helps to collect more relevant accurate information, which can helps to decide useful hypothesis.

II] Focus- Group Research: -

A focus group is a gathering of 6 to 10 persons who are invited to spend a few hours can skilled moderator to discuss a product, service, organization or other marketing activities. This moderator needs objective, knowledge of the issue, knowledge of the consumer attitudes this gathering is conducted in a pleasant surrounding.
The moderator encourages free and easy discussion, easy exchange of views.
This type of research is a useful to exploratory steps to take a large-scale survey.

III] Survey Research: -

Survey research stands between observational and focus group research, on the other hand experimental research is a totally new concept. Survey researches are best suited for descriptive research. Surveys are generally conducted to learn about people’s knowledge, beliefs, preferences, satisfaction & so on to measure the magnitude in the consumer population.

IV] Experimental Research: -

The most scientifically valid research is experimental research, Experimental research calls for the selecting matched groups of subjects, which need to be handled for different treatment and checking whether observed response differences are statistically significant. The main purpose of experimental research is to capture cause and effect relationship.

C] Research Instruments: -

Primary data can be collected with the help of two main research instruments:-

1) Questionnaires: - The questionnaire is the most common instrument in collecting primary data. A questionnaire consists of a set of relevant questions sent to respondents for their answers. Questionnaires need to be carefully developed, tested & prepared before hand & before administrating on large scale. The form of questions can influence the response. Questions are generally of two types: -

A) Closed- end Questions: Which have all possible answers & respondents make choice among them.
B) Open-end Questions: Which allows the respondents to answer in their words. Those questions get better response and useful exploratory stage.

2) Mechanical Instruments: - Mechanical Instruments are frequently used in marketing research. These are used to study the approach, impact or sequence of questions. For exa. Galvanometer measures subject interest and emotions. Audiometer detects the tuning of the voice.
D) Sampling plans: -
Meaning of sampling plan is essential to take three important decisions:-
• Sampling Units: - This answers, “ who is to be surveyed?” The marketing researcher must define the target population that will be sampled.

• Sampling Size: - This answers, “ How many people should be surveyed?” A large sample gives more reliable results than small samples. Samples size of less than 1 % of the entire population can provide good reliable results.
• Sampling Procedure: - This answers, “ How should respondent to be chosen?”

E) Contact Methods: -

This answers the question, “ How should the subject be contacted?” The choices are: -
• The mail questionnaires: - This is the best way to reach individuals who would not give personal interviews. Response rate is usually low or slow.
• Telephone interviewing: - This is the best way of gathering information quickly. Response rate is high.
• Personal interviewing: - It is the most versatile of the three methods. The interviewer can ask more questions and is very expensive method and requires planning.


The researcher must collect the data. This stage is most expensive and most possible to error. In case of surveys major problems arise: -

• Some respondents may not be at home, must be re-contacted.
• Respondents may refuse to cooperate.
• Some may give biased answers.
• Interviewers may be biased.

In case of experimental research, the researcher has to worry about matching the experimental and control groups not by influencing the participants by their presence how by giving uniform treatment.


The next step in the marketing research process is to extract findings from the data. The researcher tabulates the data and develops one way and two-way frequency distances. Researcher also applies some advanced statistical techniques and decision models to discover additional information and findings.


The researcher should not over power the management with lots of numbers of facts and findings. Only major findings need to be presented which are relevant to the major marketing decision.

Presentation Analysis & Interpretation of Data
Table no 1

Market Segmentation
Segment name Represented by No. of Companies Percentage
Auto Components A 94 58%
Electrical & electron B 14 9%
Project Type C 1 1%
Equipment Mfg D 17 11%
Others E 34 21%
TOTAL 160 100%

From the above table it is clear that, majority of companies considered for the purpose of the survey belong to automobile sector i.e.58%, followed by ‘others’ i.e.21%, equipment manufacturing i.e.11%,electrical and electronic cos i.e.9% and project type manufacturer is only1%
This clearly gives an indication that there are good business opportunities in automobile sector for The ERP package



Auto Components Electronic component Project Type Equipment Manufacturer Others
0-5 crs 35 5 - 3 2
5-10 crs 25 3 - 4 15
10-25 crs 23 2 1 4 9
Above 25 crs 11 4 - 6 9
Total 94 14 1 17 34

From the above table it is seen that, majority of the companies under survey have an annual turnover in the slab of 5-10 crore which are 47 in out of the total companies, this is followed by those who belong to the slab of 0-5 crore which are 45 in number. The number of companies belonging to the slab where the annual turnover is between 10 crore to 25 crores are 39 and above 25crs are 30 companies.

Table no3
Companies using ERP package
Sr no Opinion No of companies percentage
1 YES 25 16%
2 NO 135 84%
Total 160 100%

From the above table it is clear that, 25 companies are using ERP whereas 135 companies are not using it. So there is a huge scope for ERP products and also for IOTA to grab this potential market.

Table no 4

Segment wise usage of ERP package
Auto comp Electronic Project Equipment others Total
ERP user 9 2 1 5 8 25
Non ERP user 85 12 - 12 26 135
Total 94 14 1 17 34 160

The above graph indicates that automobile sector has huge potential for ERP the sector has 85 companies which have not any ERP product, in electronic segment there are 12 companies which haven’t installed nay ERP package, out of 17 equipment manufacturing companies only 5 companies having ERP software 12 companies may be in need of ERP product, in other segment also there are 26 companies which don’t have any ERP system. 
Table no 5



No. Of Companies
1 Reasonable 40 25
2 High 92 57
3 Non-Decisive 28 18
Total 160 100

From the above table it is observed that, 28 companies are not able to decide about the price or the cost of the Iota’s ERP package, whereas 92 companies feel it to be high and 40 companies feel it to be reasonable. So IOTA has to think on their ERP package price or else adopt some other strategy to tab potential customers.

The above chart and table shows the category wise segmentation of different companies. In this the companies are divided in to different categories according to the information collected from the survey. The categories are decided upon the availability of the information. The basis on which the categories are decided are as follows:

Categorization Details

Category Name Explanation
A These are the companies having no potential for ERP
B These are the companies who’s are from can’t say category
C These are very small companies, they don’t required ERP
L These are the companies which have local ERP product
E These are companies which have branded ERP product

Based on this the above table (category wise segmentation) is prepared. From the chart it is clear that the no. of companies are maximum in C category, and the no. of ERP implementations are very less compared to no. of companies. So it’s obvious that the scope in this category is more compared to any other category. Where as category E itself tells that all the different companies form different segments in this category have already implemented ERP. So there is no further scope. Where as is category A the implementations are less in number, but we shouldn’t forget that the no. of companies are few in number. And category B is self explanatory since some information of that company from that segment is missing. If that information is available it will be merged in some other category, and the percentage of that category will go up by some percentage.


Category for ERP potential
Sr no Category No of companies percentage
1 A 51 32%
2 B 30 19%
3 C 54 34%
4 L 10 6%
5 E 15 9%
TOTAL 160 100%

The above table indicates the probable suspect customer categories for the ERP packages in near future.

Only 25 companies are using the ERP package at present wherein 10companies are using local ERP product where as 15 companies are using branded ERP product. 54 companies are not eligible for the category for any ERP product. 32% companies i.e. 51 companies have potential to buy ERP product so here is the opportunity for IOTA to tab this potential market. The rest of 30 companies are not clear about there policy regarding ERP product or else there could be unavailability of decision making regarding ERP product. So in a nutshell this gives us the idea of the scope of ERP in Pune industrial area.

Table no7

Category for ERP potential
Sr no Requirement status No of companies Percentage
1 Immediate Requirement 18 11%
2 ERP in near Future 27 17%
3 May go for ERP system 38 24%
4 No policy laid 77 48%
TOTAL 160 100%

From the above table it is clear that, 18 companies have an immediate requirement for ERP, 27 companies have requirement in near future, 38 companies may go for ERP whereas 77 companies have not laid any policy at present. Hence IOTA can have these 18 companies as potential customers which can convert in to real customers

Chapter VI

 Expectations of companies from the ERP vendors
 Building less expensive software
 Keeping pace with business dynamics and changing scenario
 Giving more business insight
 Leverage on investments
 Building a simple , easy to use , robust system
 Maintaining the resources to match skill set
 Less configuring complexities
 Fast deployment of entire system with all functional modules
 Easy up gradation as the business demands
 Low cost real value addition in terms of contribution to the bottom line of the company
Some of the findings from research work. . .
 Considering the total no of companies covered in Pune & nearby Pune, 58% of the companies belong to Auto component segment, 9% of the companies belong to Electrical & Electronics segment, 1% of the companies to Project type segment ,11% of the companies belongs to Equipment manufacturing segment and 21 % of the companies belong to others category.
 The survey indicates majority of the companies under survey have an annual turnover in the slab of 5-10 crore which are 47 in out of the total companies, this is followed by those who belong to the slab of 0-5 crore which are 45 in number. The number of companies belonging to the slab where the annual turnover is between 10 crore to 25 crores are 39 and above 25crs are 30 companies.
 From the survey it is clear that, 25 companies are using ERP whereas 135 companies are not using it. So there is a huge scope for ERP products.

 The survey indicates that automobile sector has huge potential for ERP the sector has 85 companies which have not any ERP product, in electronic segment there are 12 companies which haven’t installed nay ERP package, out of 17 equipment manufacturing companies only 5 companies having ERP software 12 companies may be in need of ERP product, in other segment also there are 26 companies which don’t have any ERP system.

 Out of 160 companies only 25 companies are using the ERP package at present wherein 10companies are using local ERP product where as 15 companies are using branded ERP product. 54 companies are not eligible for the category for any ERP product. 32% companies i.e. 51 companies have potential to buy ERP product. The rest of 30 companies are not clear about there policy regarding ERP product or else there could be unavailability of decision making regarding ERP product. So in a nutshell this gives us the idea of the scope of ERP in Pune industrial area.

 The survey indicates that, 18 companies have an immediate requirement for ERP, 27 companies have requirement in near future, 38 companies may go for ERP whereas 77 companies have not laid any policy at present.

Chapter VII


 SME customers are demanding that ERP solutions should match with their own business, which means that they want customized ERP solutions. But what they don’t understand is packaged ERP solutions are designed from best practices and therefore if they go for customization, the whole idea of implementing an ERP solution gets defeated.
 For the SME segment the success factor lies in being able to put oneself in the SME organization’s shoes and think like them.
 Since the no. of companies in B category are maximum i.e. their turnover is in the range of 5-10 crore, so concentration should be on this category since there is huge market.
 More focus should be given on interaction with prospective customer.
 Response time should be reduced.
 As 135 companies under survey are currently using various software packages, there is a business opportunity for the ERP package of the IOTA technologies.
 The company can develop relationship with 65 companies as future clients. Since they felt necessity of the ERP package in near future.
 As majority of the companies having the low turnover slab i.e0-5 crores, so that the company have to reduce the price of ERP package or it can develop another low price package for this class organization.

 The vendors should keep in mind all the time that they have to
 Keep pace with technology
 Build systems on robust platform
 Competition with global giants as well as local vendors
 Increased awareness in customers
 Can not take client for a ride
 Customization is the crux of the local market



IOTA Technologies Ltd is a leading provider of Enterprise Resource Planning (ERP) system for the manufacturing, sales, and distribution industries. It offers software solutions in ERP, SCM, logistics and industrial automation. Internet based project and quality management software handles. The complete process of project planning, work distribution, task monitoring, time sheets, quality assurance, release management and defect tracking. Windows, Linux networks, Web servers hosted with various IPS’s and dedicated high-speed Internet connection cater to application development and testing requirement of various project groups in the company.
The overall geographical area of PUNE Industrial Estate is supposed to have a large number of companies which is an indicated of good business prospects for the company.
As per the study the availability of ERP in the market is known to every organization but majority of them are not aware of the ERP concept, it’s uses and benefits. Only few companies are using the ERP and some are ready to shift from their old software packages to this new one. The product is supposed to be quite technically sound in nature; therefore it needs technical support from the company before and after the implementation. The company should concentrate on those companies, which are eligible for ERP package as their prospect customer. Which will be helpful for the company in the near future, for their growth and development.



Iota Technologies Limited
Suspect Information Form (SIF)

Prepared By: ____________________________________ Date: ___________________

Name of the Company /
Attach visiting Card

Telephone & FAX
(With Std Code)
Email and Website

Contact Person &

Mobile Number &

Business Segment

Product & Services

Annual turnover

Number of Employees

CEO / Director
Name :___________________________________________
Email: ___________________________________________
Name: ___________________________________________
Email: ___________________________________________

Current package used Yes / No
Future requirement Yes / No
Source of Information

Qualify to Prospect Stage Yes / No

Chapter IX

• Marketing Management Philip Kotler
• Marketing Management Ramaswamy & Namakumari
• Marketing Research David J Luck / Ronald S Rubin
• Marketing Research Ronald F Bush.
• Marketing Research Aaker Kumar/Kumar/Das

• Network Magazine India
• Express Computers

Internet www.iotasoft.com

Company Records : Product Manual
Training Booklet