AN ERP ANALYSIS OF AIR INDIA

PRABHLEEN KAUR

INTRODUCTION

Air India was founded as Tata Airlines in 1932, a division of Tata Sons Ltd. (now Tata Group) by J. R. D. Tata.

After World War II, regular commercial service was restored in India, Tata Airlines changed its name to Air India and became a public limited company on the 29th of July, 1946. On 11 June 1962, Air India became the world's first all-jet airline.

CONTD….In 2007, the Government of India announced that Indian

Airlines would be merged into Air India. As part of the merger process, a new company called the National Aviation Company of India Limited (now called Air India Limited ) was established, into which both Air India (along with Air India Express) and Indian (along with Alliance Air) would be merged. Once the merger was completed, the airline - called Air India - continued to be headquartered at AIR INDIA BULIDING ,NARIMAN POINT in Mumbai and have a fleet of over 130 aircrafts.

CONTD….After merger of Air India and Indian airlines

V.THULASIDAS was appointed as Air India Chairman and Managing Director Currently MR.ROHIT NANDA is Chairman and Managing Director

Net revenue in 2011 for Air India was Rs. 4467 and in 2012 its Rs.4757 in CRORE’S. Net Revenue has increased by 6.5% despite 17% decrease in capacity because of pilot strike

PRIMARY OBJECTIVE OF THE STUDY

The project has been done with a prime objective of analyzing, understanding & interpreting the dynamic role and working of ENTERPRISE RESOURCE PLANNING in Air India and the main factors behind its dynamic nature, along with its Effect on the over All performance of the Air India.

INTERMEDIATE OBJECTIVE In the process I was focused on intermediate objective

of understanding the amount of revenue earned by Air India from its different dealings and making the necessary Entries with respect to that in ERP.

During the project period as well as in the project report I committed to make some required recommendations (if any) to the organization in order to make the objective of the project a real success.

RESEARCH METHODOLOGY

QUALITATIVE AND QUANTATIVE RESEARCH-

THE TOPIC IS CONCERNED WITH ERP RESEARCH ISSUES AND WORKING .

THIS RESEARCH INCLUDES THE USE OF QUALITATIVE DATA SUCH A DOCUMENTS,INTERVIEWS AND PARTICIPANT'S DATA TO UNDERSTAND AND EXPLAIN GIVEN PHENOMENA IE USAGE OF ERP SOFTWARE AND ITS APPLICATIONS.

ALSO DATA HAS BEEN COLLECTED FROM 100 RESPONDENTS WITH THE HELP OF QUESTIONNAIRES- METHOD OF PRIMARY DATA COLLECTION WITH THE TECHNIQUES OF CONVIENIENCE SAMPLING AND TO DERIVIE MORE INSIGHTS AND ARRIVE AT MORE MEANINGFUL CONCLUSIONS.

RESEARCH DESIGNDESCRIPTIVE RESEARCH DESIGN AS IT

DESCRIBES ERP AS IT EXISTED AND AS IT CURRENTLY EXISTS .IT GIVES MEANING TO THE QUALITY AND STANDING OF FACTS RELATED WITH ERP IMPLEMENTATION AND ITS WORKING

TOOLS FOR DATA COLLECTION1)SURVEY METHOD

Data regarding the study has been gathered through PERSONAL OBSERVATIONS AT WORK PLACE by analyzing the Behaviour of the people that is non verbal and physical Behaviour’s .

In such cases I observed the agents coming to the organization for making payments to the higher authorities of the department.

They also came to take Airway bill stock from the department.

 2) PERSONAL INTERVIEWS 

I USED THIS METHOD TO COLLECT DATA SINCE DEEP INVESTIGATION WAS REQUIRED AND THE RESPONDENTS OFFICIALS WERE NOT WIILING TO PUT THE FACTS IN THR WRITTEN FORM.I ASKED QUESTIONS ABOUT –

WHAT SOFTWARE IS USED FOR ERP THAT IS ORACLE SOFTWARE??

HOW ARE THESE AIRWAY BILLS ENTRIES MADE IN THE SYSTEM??

WHAT ARE THE NAME OF THE AGENTS AIR INDIA DEALS WITH??

SOME OF GOVT PARTIES NAMES LIKE MINISTRY OF EXTERNAL AFFAIRS,DEPARTMENT OF TOURISM ETC

IN ERP WHY DO WE MAKE TRANSACTIONS AND RECEIPT AND CREDIT MEMO AND DEBIT MEMO ENTRIES SEPERATELY ??

WHAT IS THE ID THAT IS USED TO START ERP SYSTEM SPECIFICALLY FOR THAT DEPARTMENT AND THE ID WAS ‘172.16.7.4’

FROM HOW MANY YEARS ERP IS BEING USED IN AIR INDIA???ITS BEING USED FOR THREE TO FOUR YEARS IN THE PARTICULAT DEPARTMENT

THESE QUESTIONS WERE ANSWERED PERSONALLY AS WELL AS TELEPHONIC CONVERSATIONS BY THE RESPONDENTS

3) QUESTIONNAIRE METHOD

  This method was used to gather first hand

information from 100 respondents with the help of sampling techniques like Random and Convenience sampling personally in order to avoid ambiguity and confusion on part of the respondents and to collect true and standardized data to access how satisfied and Easy there tasks have become after ERP software Implementation.

DEFINING ERPERP is the acronym of Enterprise Resource Planning. ERP

utilizes ERP software applications to improve the performance of organizations' resource planning, management control and operational control.

ERP software is multi-module application software that integrates activities across functional departments, from product planning, parts purchasing, inventory control, product distribution, to order tracking.

ERP software may include application modules for the finance, accounting and human resources aspects of a business.

ADVANTAGES OF ERP SYSTEMS

There are many advantages of implementing an EPR system. A few of them are listed below:

A perfectly integrated system chaining all the functional areas together

The capability to streamline different organizational processes and workflows

The ability to effortlessly communicate information across various departments

Improved efficiency, performance and productivity levelsEnhanced tracking and forecastingImproved customer service and satisfaction

DISADVANTAGES OF ERP SYSTEMS

While advantages usually outweigh disadvantages for most organizations implementing an ERP system, here are some of the most common obstacles experienced:

The scope of customization is limited in several circumstances

The present business processes have to be rethought to make them synchronize with the ERP

ERP systems can be extremely expensive to implementThere could be lack of continuous technical support ERP

systems may be too rigid for specific organizations that are either new or want to move in a new direction

ERP IMPLEMENTATION IN AIR INDIA

The airline sent around 40 people to Oracle University for training on Oracle Inventory and Oracle Purchasing, followed by training on Oracle Financials. Technical staff received Level 1 and Level 2 system administration training and attended patch installation courses before the implementation of this software.

STEPS IN ERP FOR CONDUCTING AGENT TRANSACTIONS

 

STEP A- WHEN THE TRANSACTION IS ENTERED

GATHER THE LIST OF AGENTS WITH THEIR NAMES AND AGENT CODES

COMPUTE THE NET AMOUNT AFTER DEDUCTIONS THAT HAS TO BE EARNED FROM AGENTS

IN ERP GO TO TRANSACTIONS PRESS F11 WRITE THE AGENT CODE AND NUMBER WRITE THE DATE - ACTUAL DATE OF TRANSACTION WRITE THE GL DATE - CURRENT DATE WHEN TRANSACTION IS

BEING ENTERED IN THE SYSTEM OF ERP

CLICK THE OPTION OF LINE ITEMS

ENTER THE AMOUNT OF FREIGHT,DUE CARRIER,COMMISSION CHARGED BY THE AGENTS,TDS,OTHER INCENTIVES AND ROUNDING OFF

CLICK THE OPTION OF DISTRIBUTIONS

CLICK ON THE CLASS

AIR INDIA ACCOUNTING FLEXFIELD BOX WILL APPEAR IN FRONT OF YOU

STEP B- MAKING ENTRIES OF RECEIPT OF THE PAYMENT DUE FROM AGENTS IN THE ERP SYSTEM OF AIR INDIA

ENTER THE INVOICE NUMBER DERIVED FROM THE PREVIOUS STEP

WRITE IN "PAYMENT METHOD " HEADING-772 (STATION CODE)-C-AGENTCODE-BANK NAME TO WHICH AMOUNT IS CREDITED-AND THE RECEIVED AMOUNT IN TOTAL IN INR TERMS

WRITE THE INVOICE NUMBER TOO THAT WAS DERIVED FROM STEP A

CLICK THE BUTTON OF CONFIRM IN ERP

THE RECEIPT ENTRY ONCE APPLIE IN ERP IS COMPLETE AND INDICATES THE AMOUNT ACTUALLY RECEIVED FROM THE PARTICULAR AGENT ON A SPECIFIC DATE.

STEP C -FOR MAKING ERP ENTRIES OF CREDIT MEMO/NOTE

OPEN TRANSACTIONS AND PRESS F11 AND AT SOURCE WRITE 772-MANUAL-CM,WHERE 772 IMPLIES STATION

CODE OG DELHI IGI AIRPORT,MANUAL IS MANUALLY DONE AND CM REFERS TO CREDIT MEMO

ALSO ENTER THE RECEIPT NUMBER DERIVED IN THE PREVIOUS STEP IN CLASS OPTION ENTER CREDIT MEMO IN TYPE OPTION ENTER 772-C CORRECTION CM ENTER THE DATE ALONG WITH GL DATE GO TO LINE ITEMS IN THE DESCRIPTION HEADING WRITE THE AMOUNT OF TDS CHARGED

FOR THIS PARTICULAR AGENT ALONG WITH THEIR ACTUAL INVOICE NUMBER NOT THE TRANSACTION NUMBER

ENTER THE UNIT PRICE IN NEGATIVE (-) TERMS IN ORDER TO ZERO THE AMOUNT APPLIED AS TDS IN ERP WHILE MAKING THIS CREDIT MEMO ENTRY

CLICK ON DISTRIBUTIONS

CLICK ON THE CLASS ENTERED

ENTIRE AIR INDIA ACCOUNTING FLEXFEILD WILL APPEAR AS EARLIER ALONG WITH THE SAME HEADINGS

PRESS ENTER AFTER FILLING ALL THE VALUES REQUIRED IN THIS ACCOUNTING FLEXFIELD BOX

GO TO THE FIRST PAGE AND CLICK THE BUTTON OF COMPLETE IN THE EXTREME RIGHT CORNER

THE CREDIT MEMO IS MADE

BALANCE DUE FROM THE PARTICULA AGENTS EQUALS TO ZERO AND THE ENTIRE AMOUNT IS NIL

AND THE ENTRY PROCESS FROM THE AGENT IS COMPLETED IN ERP SYSTEM

DIFFERENCES IN DEALINGS WITH AGENTS AND WITH GOVT .OF INDIA  

In Government party transactions under the heading type we fill 772-C BO CR SALE.

In agent transactions under Type heading we fill -772-C AGENTS SALE IN

In Government party transactions REFRENCE NUMBER has to be filled without which the transaction cannot be complete.

In agent transactions there is no such requirement

  In Govt party dealings THE CODE USED IS GI along with

station code and last 5 digits of the Reference number

In Agent deals THE CODE USED IS AG along with station code and last 5 digits of the agents number

CONTD…..In government party transactions COMMISSION is not

charged and thus is not shown in the line items

  But in case of agents COMMISSION is charged by the agents and so it has to be shown in the line items.

  Lastly in Government party transactions Account code is

71513 and Sub account Account code is 1204

  But in case of agents the account code is 14308 and sub account code is given by DEFAULT.

ANALYSIS & FINDINGS 

MY ANALYSIS WAS IN THE FORM OF QUESTIONNARES ,THAT WERE FILLED BY 100 RESPONDENTS AND THERE VIEWS WERE RECORDED DIFFERENTLY FOR EACH QUESTION.

SOME OF THEM ARE EXPLAINED AS FOLLOWS :-

Which Technology Related To ERP In Your Opinion Is The Most Beneficial?

Oracle Databases Blue ERP SQL Unix SQR Any Other

A1 ERP BLUE ERP ERP 5 ERP NEXT OPEN ERP TRYTON ANY OTHER0%

10%

20%

30%

40%

50%

60%

WHICH ERP SOFTWARE IS USED IN YOUR INSTITUTE ??

Here the responses was quite partial and on leveled basis 5 % opted for A1 ERP,10% each for ERP5 and NEXT,

Among the options best response was in Favour of BLUE ERP Software(50%) Its a double entry accounting application and is preferred the most as per my survey, and others opted for any other software either because they were not having complete knowledge of these software's or due their own preference 

Do You Think ERP Software Is Essential For Every Organization Whether School Or Colleges?

Strongly Agree Agree Neutral Disagree Strongly Disagree

STRONGLY AGREEAGREE

NUETRALDISAGREE

STRONGLY DISAGREE

0%

10%

20%

30%

40%

50%

60%

70%

80%

IS ERP SOFTWARE ESSENTIAL FOR EVERY ORGAN-ISATION ??

ERP SOFTWARE is the important requirement for all the organizations whether businesses ,colleges, schools or any other institutions as it improves the performance and efficiency thereby strengthening the relations prevailing in the organizations .so 75/100 respondents agree that its essential part of the system but not "THE MUST ONE ".

IT OFFERS VARIOUS BENEFITS AND THUS IS CRUCIAL :-

 CentralizationImproves EfficiencyPerformance And Productivity LevelsEnhanced Tracking And ForecastingImproves Customer Service And SatisfactionWeb Based Application That Can Be Accessed From

Anywhere In The World

 

How Important Is ERP in Today's Scenario?

Very Important Especially For Developing And Large Organizations

Not Relevant

85%

15%

HOW IMPORTANT IS ERP IN TODAY'S SCENARIO ??

HIGHLY RELAVANT FOR DEVLOPING AND LARGE INSTITUTESNOT RELEVANT

ERP SOFTWARE is of crucial importance in today's scenario as per 85% of the respondents interviewed whether Its to combat the competition, Ensure quality information flow or integration of various operations as well as for maintaining healthy customer relations for overall improvement and thus highly negligible that is only 15% of respondents considered it to be less useful and essential   

Do You Think That The Field Of ERP Software Development Will Grow Or Shrink In The

Future?

GROWSHRINKCANT SAY  

90%

5%

5%

ERP WILL GROW OR SHRINK IN THE FUTURE ??

CONTD….

ERP SOFTWARE development will surely grow in future because there are always new requirements, new innovations and upgrades in Technology.

It replaces existing legacy systems in order to make processes more efficient.

After the success of key players in ERP market SAP,ORACLE AND MICROSOFT the future of ERP is certainly bright and thus 90% of respondents gave a positive response For the growth of this software

“SO OVERALL CONCLUSION GOES WITH THE FACT THAT  INSPITE OF FEW FLAWS OF THIS SOFTWARE ,ITS NECESSITY IN TERMS OF PERFORMANCE IMPROVEMENT ,RELATIONSHIP BULIDING AND OTHER AREAS CANT’ BE NEGLETED AT ALL “ 

  

SUGGESTIONS & RECOMMENDATIONS

  

A)WORKING ON SAP 1)SAP IS THE LARGEST PROVIDER OF ERP SOLUTIONS WORLD WIDE AND HAS BEEN PREFERRED BY MORE THAN 115 AIRLINES 2)SAP SOLUTIONS SUPPORT THE CORE BUSINESS OF AIRLINES IN PASSENGER SERVICE PLANNING AND DEVLOPMENT AND ALSO MRO(MAINTENANCE,REPAIR AND OVERHAUL) FUNCTIONS. 3)THE IMPLEMENTATION OF SAP ERP PACKAGE WOULD HELP AIR INDIA IN STRATEGIC DECISION MAKING,MONITORING AND CONTROL SYSTEMS

     

 4)BESIDES INTEGRATION OF KEY BUSINESS FUNCTIONS IN THE ERSTWHILE INDIAN AIRLINES AND AIR INDIA ,THE PACKAGE WILL ALSO HELP IN INTEGRATION WITH OTHER SYSTEMS AND ENSURING AVAILIBILTY AND CONSOLIDATION OF CRITICAL DATA AND INFORMATION. 5)AT THE SAME TIME AIRLINE CAN VOUCH FOR IMPROVED PROFITABILITY BY AVAILABILITY OF REAL TIME INFORMATION ON ROUTE NETWORK AND PROFITABILITY 6) THUS SAP IMPLEMENTATION SHOULD BE MADE IN AIR INDIA AS SOON AS POSSIBLE

  

B)PREPARATION OF PROPER SCHEDULE TO KEEP THE COMPANY'S PROJECT'S FROM GOING OVER BUDGET AND SPLLILING OVER ITS LIMITS ,THERE IS REQUIREMENT TO MAKE A DETAILED ITIENERARY AND DOING BEST EFFORTS ON STICKING TO IT TO MAKE ERP IMPLEMENTATION MORE SUCCESSFUL AND RESULT BEARING 

c) CONTINUOUS TRAINING ON ERP AND ITS WORKING TO THE OFFICIALS

ERP USERS NEED TO BE TRAINED PROPERLY IN AIR INDIA IN ORDER TO ACQUIRE NECESSARY SKILLS FOR USING THE FUNCTINALITIES RELAVANT TO THEIR ROLES.THEY NEED TO BE FAMILIAR WITH BASIC CONCEPTS AND ACTIVITIES RELATED TO THE WORKING OF THE SOFTWRE.

SELECTED PEOPLE APART FROM HIGHER LEVEL AUTHORITIES SHOULD BE GIVEN SPECIFIC TECHNICAL TRAINING SO THAT THEY CAN DESIGN DATABASES , WRITE SCRIPTS, MANAGE USERS, GENERATE THE REPORTS AND QUERY THE DATABASES FOR THE SPECIFIC REQUIREMENTS.

THE SYSTEM ADMINISTRATORS IN AIR INDIA OF ERP ARE ABLE TO SET AND MAINTAIN IT VERY EFFICIENTLY. BUT THEY STILL REQUIRE IN DEPTH AND CONFIDENTIAL INFORMATION FOR PROPERLY HANDLING SYSTEM SECURITY AND DEALING AND SOLVING SOME MORE TECHNICAL PROBLEMS RELATED WITH THE SOFTWARE WORKING. 

C)CONTINUOUS TRAINING ON ERP AND ITS WORKING TO THE OFFICIALS 1)ERP USERS NEED TO BE TRAINED PROPERLY IN AIR INDIA IN ORDER TO ACQUIRE NECESSARY SKILLS FOR USING THE FUNCTINALITIES RELAVANT TO THEIR  2)SELECTED PEOPLE APART FROM HIGHER LEVEL AUTHORITIES SHOULD BE GIVEN SPECIFIC TECHNICAL TRAINING SO THAT THEY CAN DESIGN DATABASES , WRITE SCRIPTS, MANAGE USERS, GENERATE THE REPORTS AND QUERY THE DATABASES FOR THE SPECIFIC REQUIREMENTS.

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