Sonata's SAP business: Helping companies define value proposition

The implementation of SAP software is a huge operation that requires efficiency and experience. Among some of the best IT consulting and services companies that provides these is Bangalore headquartered Sonata Software, and at the helm of Sonata's growing and successful SAP business is Ram Subramanya, a veteran with over 20 years experience in the industry. Siliconindia caught up with Ram, who spoke on the current landscape for SAP implementation.

SI: Sonata has been into the ERP arena for quite a few years now. It has been servicing the SAP clients in the Indian subcontinent for a while now. What are the current trends that you see in the ERP arena?

RS: If you look at the businesses as such today, what they are looking at is that how they can get some kind of operational excellence in their operations - to be at the same time profitable, and operate it in their own lines. Businesses revolve around how efficiently they can respond to their customers, how efficiently they can respond to their suppliers so that they can benefit, or how they can consolidate all the requirements, and buy them together rather than buying it every day one piece at a time. So that's where Sonata comes in. Based on our talent in terms of understanding the best practices for an industry which is incorporated into the ERP, we help our customers drive transformational changes in how they do business.

What we also see is that our customer needs have changed too. They are more knowledgeable today, and they take active interest in ERP related activities. Today they know what they need, and hence we can see more ownership from the management teams.

SI: One of the key advantages of choosing Software-as-a-Service (SaaS) is that companies can save huge amounts of money by not having to provide the on-premise IT support infrastructure. For half the fee, companies can avail of the software faster. The market for ERP applications delivered through the SaaS model is set to grow to $193 million by 2012 in the Asia-Pacific excluding Japan region, according to a survey by Springboard Research. What are your views on the SaaS ERP system?

RS: As far as ERP and SaaS are concerned, they are like two edged swords. Most importantly companies are not keen on sharing confidential data when it comes to ERP. Their salary information might be in the ERP. So definitely it is a challenge in implementing SaaS on a ERP cycle. Also, because the software is hosted remotely and likely used by many different customers, you can't tweak the functions to suit your business.

But, ultimately companies might shift to this model. From the current capital expenditure to implement an ERP, it might move to operational expenditure, with the infrastructure housed in datacenters. Cost benefit is passed on, but it is still not truly cloud, since the data security, and authorization security, might be controlled, by specific hosting in a datacenter.

As far as SaaS ERP is concerned, I think India has ways to go. Currently Sonata is trying to work on a new model, which we will be implementing in six months or one year.

SI: ERP failure cannot be tolerated by organizations as it involves great money. And developing and installing an ERP system is among the most daunting tasks, especially in manufacturing today. What should companies keep in mind before going for an ERP today?

RS: Companies look for solutions through which they can serve their customers better. So it is very critical that they pick the right vendors or consultants. But before evaluating vendors, consultants or software options, the customer must understand, in detail, what the system requirements are and what options will be needed in the future.

What you are really doing when you decide to move to a new and more efficient IT and ERP system is agreeing to re-engineer your management processes. The typical lifecycle of an ERP is eight years. So, when you move to a new system or upgrade your existing system, you may be changing the managerial procedures and techniques of your whole company.