Page 299 - DMGT401Business Environment

Business Environment

Notes 4. When the cost of HR is a significant cost of production as in case of the software or service
industry, the new trend is to shift the location of the unit where HR is available in
abundance. This is the reason that more and more software companies are coming to
India.

Case Study Technology and Innovation at Asian Paints

t would be appropriate to undertake a study of Asian Paints in this unit, for its use
of technology through the years to gain a competitive edge in the marketplace. “
IToday, the company has formulated an entire range of decorative coatings through
homegrown technology. It has always given emphasis to R&D and continuously made
investments in this development of Information Technology. It has used IT as a tool to
bring efficiencies and streamline operations. The use of IT and R&D will continue to be
important in the future and Asian Paints will not hesitate in making investments in these
areas to gain advantages for the organization.”
Continuous reconfiguration of activities in the value chain is a key task of all companies
aiming to remain competitive and to achieve the highest value-cost leverages. Given this
requirement, what were the key initiatives taken by Asian Paints during the last 5 years?
In last five years, reconfiguration of value chain activities to increase competitiveness has
been one of the major focus areas for Asian Paints. In fact, Asian Paints has transformed as
an organization. The sales and profit figures will reflect the strong financials of the company.
But most have important have been initiatives undertaken in all areas of operations to
increase efficiencies. Some of the key initiatives undertaken are:

1. Initiatives in manufacturing to reduce losses at factory
2. Sourcing efficiencies
3. Introduction of new technology to boost efficiencies and increase productivity

4. Implementation of a new supply chain solution
5. Implementation of an ERP solution
Besides the above, it has focused on continuously improving environment management
standards at our plants. Today, all Asian Paints manufacturing facilities are accredited
with the ISO 14001 certification for environment management standards. These systems
have enabled the company to reduce effluence from the manufacturing facilities. The
introduction of the new supply chain solution has transformed functions like management
of inventory and forecasting demand. A new solution that helps centralise demand
forecasting has brought significant benefits for the company through reduction of working
capital. It has changed the manner of functioning of the supply chain division.

Question
Critically analyse technological progress at Asian Paints.

Source: Ashwin Dani,Vice Chairman, (Adapted from website of General Management Review) Asian
Paints (India) Limited.

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