The VNC Group is a $450 million conglomerate based in Karur, Tamil Nadu that manufactures welding electrodes and steel products. Through timely adoption of technology and focus on quality, the company has grown from a small room in 1983 into a large multi-business group. The implementation of an ERP system recently integrated all the group's companies and provided benefits like consolidated reporting, inventory tracking, and process standardization. The ERP system and continued technology usage will help VNC sustain its goal of consistent rapid growth across various business sectors in the future.

1. Management
Technology Helps VNC
Sustain Continuous Growth
Headquartered in Karur, Tamil Nadu, the VNC Group is an excellent
example to emulate for all those companies that may be small today but
aspire to make it big!
“T
he only way to do timely adoption of technology and and to systematically organise the
business is to grow, uncompromising focus on product industrial products sector, which
grow, and grow even quality, the VNC Group has grown was a highly unorganised sector in
more…” It is this philosophy that into a dynamic multi-business the early 1980s.
steered the VNC Group from a company, reveals B Gokul, chief Gokul recapitulates a few
modest 6 x 6 sq m room in Karur in manager, Strategy and Performance decisions that were instrumental
1983, to becoming a Rs 450 crore Improvement, VNC Group. in adding momentum to the
group that includes VNC Electrodes, growth story of the group, “The
VNC Steels, VNC Steel Distributors The turning point strategic moves that helped the
and VNC Investments, with 12 The journey of the VNC Group company accelerate its pace of
offices across south India. began with the foundation of the growth mainly comprise its entry
The group manufactures general flagship company, VNC Electrodes into steel wire manufacture and
purpose manual wielding electrodes, by V N Chokkalingam. The founder’s its association with Tata Steel
binding wire, and fencing products. vision was to provide high quality and Lincoln Electric for the
Because of its prudent strategies, industrial products to customers, distribution of their products.”
Vandana Sharma | BenefIT Bureau
www.consultbenefit.com • BenefIT • September 2011• 45

2. Management
A server that runs the ERP solution
The group flourishes with the timely adoption of technology
Recently, the company won the operational transparency and
'Best Distributor of Tata Tiscon in
Retail’ award for the financial year
We are in an age efficiency across the board and
also tightly integrate the disparate
2010-11 by Tata Steel Limited. when it is only operations of its various companies.
relevant to ask Hence, the company decided to
Technology: The key ally! how effectively switch to the Ramco OnDemand
For the VNC Group, the timely we can use ERP (RODE) solution. The
adoption of technology tools
has always been of paramount
technology to implementation started in November
2009 and VNC went live with the
importance. Technology has been one grow. RODE solution in January 2010. The
of the key factors that has propelled implementation process took eight
the group forward, reports Gokul. chain and management processes, weeks, reports Mahaboob Ahmed N,
Underlining the relevance of the group has also recently manager, Projects, Ramco Systems.
technology adoption for growing deployed a customer relationship The decision to opt for the
businesses, he further adds: “Gone management solution. A few Ramco ERP solution was taken after
are the days when one questioned the servers have been deployed to run exercising due diligence, says Gokul.
necessity of technology. We are in an these business applications. The “We explored solutions from the likes
age when it is only relevant to ask how group also has a search engine of SAP Kennovation, Oracle and a few
,
effectively we can use technology to optimised website. others. RODE was chosen because of
grow. Besides, it has always been the VNC has a 5-member IT the minimal customisation required
group’s ambitious growth plans that team, which develops tools to when compared to other solutions,
have prompted it to adopt relevant render support to the existing IT and the value for money that the
technology solutions.” infrastructure. solution offered.”
Therefore, at the VNC Group, the The company opted for an
emphasis is not only on investing The leap towards ERP on-premise ERP model, where the
in technology but also putting it to One of the notable IT organisational data captured is
effective and optimum use. Apart implementations for the group has stored in the company's own servers.
from the ERP system implemented been its ERP suite, which integrates The decision to opt for this model
across its companies and units to all the group companies. was made due to the huge volume of
integrate its production, supply The group wanted to achieve transactions, informs Gokul.
46 • September 2011 • BenefIT • www.consultbenefit.com

3. Management
Making an ERP
implementation effective
Talking about the best practices that
were adopted before and after the
ERP implementation, Gokul says:
“The pre- and post-implementation B Gokul,
Mahaboob Ahmed N Chief manager,
stages require two different attitudes Manager, Projects Strategy & Performance Improvement,
Ramco Systems VNC Group
towards ERP. While efficiency has
to be the most important aspect in
mapping the business processes “With the “Because of prudent
during the pre-implementation implementation of strategies, timely
phase, using the new system the ERP solution, all adoption of technology
effectively needs to be the focal
point post-implementation. In other
the group companies and uncompromising
words, the ERP solution needs to be got integrated into focus on product
structured with respect to the vision one entity.” quality, our Group
that the organisation has for its has grown into a
operations in the future, and not in in the legacy system, each sales office
accordance with its current practices. (branch) was configured as a separate
dynamic multi-business
This in itself serves as the foundation finance book and then consolidation company.”
to translate the vision into reality.” was done. But now, all offices are
To achieve this, extensive training grouped under a single organisational and has defined standards.”
was given to all the end users to unit. Hence, the tracking of stock has Another important return
make them independent and help become easy. By using the production is the easy access to data that is
them to use the system with ease, module of the ERP system, they are essential for any kind of analysis.
informs Ahmed. able to track the stock at each stage The organisation now possesses the
of production, and also establish strategic advantage to launch any
The benefits derived controlled quality check measures. new initiatives or functions, which
Ahmed shares his observations The system has made it possible will be part of its intangible ROI,
related to the pre- and post- to establish effective controls over affirms Gokul.
implementation scenario in the VNC processes by enabling SMS alerts.”
Group: “Earlier, each company of the The system can also generate What does the future hold?
group was operating individually. But consolidated MIS reports at the Going forward, on the IT
with the implementation of the ERP click of a mouse. These reports infrastructure front, the company
solution, all the group companies got are used comprehensively by the plans to continue with its strategy to
integrated into one entity. The RODE VNC Group for strategic as well as focus on leveraging the most out of
solution has also addressed the operational decision making and its ERP and CRM implementations
group’s need to capture its purchase, future strategic planning. by building sub-systems (such as
production, sales and finance customised MIS reporting) over the
functions in a single application so The RoI next few years.
that the end-to-end business related Assessing the return on investment At the organisation level, the
MIS (management information that the company has got from the VNC Group is already proactively
system) reports can be viewed by ERP implementation, Gokul says: exploring diverse interests such
the management. It also provides “The tangible ROI that the group is as manufacturing, distribution,
consolidated inventory and financial enjoying is by virtue of its integrated agriculture, mining, wind power and
statements at the group level.” operations as we have brought all logistics—exploring new vistas to
Ahmed illustrates a few more the group companies onto the same continue growing consistently and
benefits that the ERP solution is platform. Every process and function rapidly. And, in this pursuit, we wish
delivering to the company: “Earlier, is now tightly controlled, systematic, the group all the very best! 
www.consultbenefit.com • BenefIT • September 2011• 47