CHAPTER 8

Para No. Title (Ctl + Click on Para no.)

801-802 Introduction
803-804 Enterprise Resource Planning (ERP)
805 ERP Infrastructure
806 System Security
807 Training
Information 808
809
E-Library
Implementation of ERP in IR
Technology 810 Areas to be covered under Workshop
ERP application
811 Work Order Computerization
812 Gate Attendance
813 Incentives
814 Supply Management and Stores
Accountal
815 Quality Management
816 Post out turn rejection
817 ERP systems for open line depots and
sheds.
818 Conclusion

Ann. 8.2 ERP Implementation Step by Step

Process

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801. Introduction

In the past, stand-alone IT systems have been set up by individual Repair

Workshops, Locomotive sheds, Coaching and freight car depots and the Production
Units to optimize their manufacturing and maintenance operations. Department
centered systems like MMIS, PMIS, FMIS etc. were also developed concurrently,
mimicking the departmental silo structure of Indian Railways. But these have
limitations in bringing about overall efficiency and provide the management a common
view of the organization at all levels.

802. Hence the need has arisen to evolve an integrated and self contained
management system such as the ERP in each production unit, workshops and LCDs
progressively, duly linking all departments within the unit. Every such ERP system
shall however have a seamless interface not only with other Production Units,
workshops and LCDs, but also already developed systems like FOIS, MMIS etc thus
sharing freely all relevant and pre-determined information across departmental and
other physical remote locations.

803. Enterprise Resource Planning (ERP)

Enterprise Resource Planning (ERP) is an information system designed to

coordinate all the activities, resources and information needed to complete business
processes such as Design, Production Control, Quality Management, Asset
Maintenance, Inventory and Warehouse Management, Project management, Customer
Management, Purchases, Costing, Accounts and HR functions. ERP systems are
centralized and have the capability of integrating with other existing systems in order
to achieve the best optimization. These systems also bring best practices from industry
that need to be adopted with suitable change management to modernize work
practices. Therefore suitable efficient workarounds may be adopted with adequate
consideration to the impacts of changes.
ERP systems should be founded on a common database and a modular
software design and should allow every department of IR to store and retrieve
information in real-time. The information is reliable, accessible, and easily shared. The
modular software design allows the user to select the modules he needs, mix and
match modules from different vendors, and add his own new modules to improve his
organizational performance.

804. ERP systems originated in manufacturing industry and hence, “Production

Planning and Manufacturing” forms still the core of these systems. Production Units
and Workshops on Indian Railways are thus ideally poised to adopt this new
technology. Industry specific versions of the modern ERP systems cover a wide range
of functions such as Human Resources, Supply Chain Management, Customer
Relation Management, Financials, Manufacturing and Warehouse Management,
integrating them into a single unified application.

805. ERP Infrastructure:

In the fast changing world of IT, it is inappropriate for the code to rigidly define
in detail, the infrastructure requirements; and hence an outline is spelt out below:
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 a. Centralized system with no EDP centre at the train care centers.
b. Integration between divisions, zonal headquarters, Railway Board. RDSO
and between sister applications- wise-II, LMS, FMM, PU-ERPs and CMMS
c. Country –wide network connectivity
d. Ease of data entry and automation: kiosks, touch screens, RF-ID card for
man & material, hand-helds for yard work, PDAs, e-pens etc.
e. Web based system which can be accessed from anywhere.
f. Single point access to all managers through a common web portal: ROAMS-
Rolling Asset Management System.
g. IP based local area network built to latest industry standards. Back-bone of
such a network should be rest on optic fiber cabling, with at least two
parallel paths to each shop providing adequate redundancy to cover
damages or outages.
h. LAN for PUs and Train Care Centers treated as a part of basic M&P
infrastructure and kept in view while planning.
i. Connect to outside world with adequate security measures to avoid any
malicious attack at the ERP installation.
j. Internet access should be provided in workshop LAN through a secure
source with appropriate network security infrastructure.
k. Wherever a network is planned for computer aided manufacturing or FMS, it
should be secured from the IP based network installed for the ERP
application.
l. All CNC M&Ps including testing and measuring equipment as far as possible
should be procured with facility for data exchange with ERP system and
capability to integrate with the IP network for on-line access of
manufacturing data from ERP.
m. There should be a CORE team for implementation, change management and
user support in the PU/Workshop with a full time set of officers to look
after the Enterprise Application and Industrial Automation (EA&IA)
functions in the workshops and PUs.
The EA&IA wing in any Production Unit or Train Care Center shall be
responsible for maintaining the local area network through specialized
agency to ensure required uptime to support the applications. This
organization shall be responsible for continued growth and development of
the application, organizing user training, refreshers, change management
trainings and maintain liaison with application hosting agency and the
industry.

806. System Security:

The system should provide for adequate security such as user Identification
Numbers (User-ID), passwords, biometric identification protocols, codified smart
cards, provisions for using digital signatures to ensure that only the authorized
personnel can have access to data, stored in the system. Where a person is authorized
only to access data without modification rights, his/her access rights should be
correspondingly restricted. Where a person is to be authorized to enter fresh data,
access stored data and modify the same including deletion of the data, provision
should be available to give the person all rights in regard to the data. Only the system
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administrator and his/her assistants required to access the data bases and programs
should be given corresponding access rights. The system should provide for recording
the identification detail of the person who accessed the system to view data, enter,
modify or deleted a data for investigation purposes if required. The system should also
have a built in login register in the form of computer files to have a record of the log-in
and log-off time of all the persons who have been given the access rights of various
levels, for investigation purposes where required. The computer files containing the
log-in and log-off details should be preserved for as many years as applicable to any
other vital office records. The system also needs to cater to exigencies of data breach,
denial of service, protocols to address security breaches and mechanisms /
procedures that may be initiated in case of such breach of the system.

807. Training:

Training and continued retraining are essential to develop IT temper amongst

workshop personnel. Compulsory courses should be introduced for freshly inducted
personnel of Group-C and D for all categories. Workshop training centre should be
developed to undertake such trainings. Standard course modules should be developed
in consultation with ERP experts. There should be a provision of refresher courses
after every two years. In addition, the EA&IA team should be trained in appropriate
IT technologies for both network and application related areas through OEMs and
certified training agencies on need basis. There should be an annual “Enterprise
Group Conference” (EGC) for interaction and exchange of IT development issues at all
India Railway level in the same lines as done in the Maintenance group meetings
(WMG, DMG etc.). In order to ensure continued development and IT enablement of
workshops and production infrastructure, EGC meetings should be conducted under
guidance of the Railway Board. And as part of standing EGC agenda, periodicity and
course content of the training courses should be reviewed.

808. E-Library

Production units and train Care centers shall develop an E-Library of their own,
which should, inter alia, ready access to documents and drawings as relevant to all
the users in the unit, subject to copyright/patent right / intellectual property/pricing
restrictions.

809. Implementation of ERP in IR

An integrated and self contained management system (such as the ERP) has to
be evolved in each Production unit and workshops and open line sheds and depots
train care center, duly linking all departments within the unit.

Once the implementation is done, the EA&IA group, should ensure an in-house
support system by way of trained employees and tie-up with external software and
hardware support vendors are put in place at all times to ensure continuity in the
usage and further improvement with the change in technology. The post
implementation Organisational structure in PU/Workshops will need a different set of

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roles and skills than those dealing with less integrated kind of systems, which shall be
defined at the level of Board.

810. Areas to be covered under Workshop ERP application:

The following modules can be available in a ERP based workshop management

system:
a. Production planning and control
b. Workshop Inventory management
c. Work in progress management
d. Machinery and plant maintenance management
e. Inprocess Inspection and quality control
f. Supply and Vendor management (Integration with MMIS and e procurement)
g. Monitoring and progress
h. Business intelligence for Reports and analysis
i. Document handling and E-library system
j. Workshop General management
k. Attendance management system
l. Need based Integration with legacy applications including purchase,
personnel and accounts applications
m. Need based integration with production infrastructure.
n. Use of automation devices at user interface to minimize use key board at
shop floor
The above list is illustrative and not exhaustive

ERP Sub-systems:

811. Work Order Computerization

Work order is the first stage and also the basic unit of activity in a production
shop. This comprises of product identification, batch size, work process, bill of
materials-manufactured items, bill of materials- bought outs, job cards containing
allowed time etc. Every step has to be part of one integrated sequential action /
process. Data entry should only be through swipe cards / work station key board.
There should be no provision for data alteration without digital authorization. Work
order closure will occur on elapse of allowed time or by foreclosure. Short produced
quantities have to be entered into the data base to work out revised allowed time and
material issued left out. Surplus material drawn will require suitable entries to be
made and acknowledgement from the Store keeper to be recorded in the data base.
Provision should exist to cross verify the workers job execution with gate attendance –
by data base integration and connectivity.

812. Gate Attendance:

Gate attendance will be through a smart card based on bio-metric

identification. The attendance card has to be used as authentication for making any
data entry in connection with work order or job cards; this will ensure that the
nominated worker only executes the job, and entries are made by him. Reconciliation
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of gate attendance hours and hours logged on job will be automatic. Accountal of
overtime/saved time becomes error free.

813. Incentives:

As discussed in Chapter 5, IT based systems help in establishing linkages

between attendance and related accounting/managerial reports:
By this, linkage of incentive payment with shop out turn as well as group performance
becomes automatic. Excess material drawn gets listed out automatically.

814. Supply Management and Stores Accountal:

This subject is covered in the Stores Code and the MMIS which drives Material
management functions in the Railways.

The IT system can be modeled on same platform as proposed ERP based

integrated MMIS. All data entry and retrieval will be from the same data base which
will be managed by a data base management system which in turn will be part of the
ERP system.

815. Quality Management:

Data entry should be mandatory for every rejection against a work order, to
facilitate accountal of actual hours as well as materials used or wasted. This data will
incorporate job card number, worker ticket number, Supervisor particulars and
Inspector’s name.

816. Post out turn rejection

Zonal Railways may encounter problems on new stock as well as stock turned
out after maintenance. Basic record of new stock has to be in one data base, into
which all subsequent repairs, IOHs, POHs etc have to be entered. Data relating to all
failures also will be entered here – directly by the Railway- where failure occurred.
These will be thrown up as exception reports at the workshops where manufacture /
repairs were done.

817. ERP systems for open line depots and sheds.

All open line sheds and depots shall have HR modules. In addition to this, open
line units shall digitize the functions as relevant to the type of rolling stock dealt
therein like integration with Operating Information Systems pertaining to maintenance
of rolling stock, performance parameters for maintenance, budget/expenditure
management etc.

818. Conclusion

Suitable productivity tests must be done in order to assess the impact of

implementation of ERP systems. Generally, answers in the affirmative to the following
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questions will determine the effectiveness of ERP systems and whether real benefits
are being derived from it:
a. Has cost accountal and analysis become dependable?
b. Are verifications and actions shifting to the system from manual dependence?
c. Wherever manual dependence is unavoidable does the system act as a deterrent
and provide alerts or exception reports to the top management?
d. Are the managers getting expenditure statements in real time?
e. Does the system ensure that no failures and detachments go unreported and
f. Trace the defect to the shop or shed where it originated from and to get in real
time the cause-wise failures in the descending order
g. Does the system generate data to support procurement decisions on “life cycle
costs”, at least for A category items
h. Total expenditure on maintenance annually for each type of rolling stock
i. Cost of POH, cost of maintenance for each type of rolling stock and each
painted number as juxtaposed to the utilization
j. Ensure a much higher compliance ratio with lower inventories
k. Is the higher management able to compare at a glance on a daily basis,
i. best practices between shops and sheds and adopt them
ii. Able to weed out money guzzling rolling stock
iii. Cost of manufacture between PUs and regulate ordering
iv. Cost of POH between workshops
v. Timings for various activities between shops and adopt the best practices

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 Annexure 8.1

ERP Implementation Step by Step Process

1. What is the ERP life cycle?

ERP lifecycle is one which highlights the different stages in implementation of

an ERP. There are different stages of the ERP implementation as given below:

 Pre evaluation Screening

 Evaluation Package
 Project Planning
 GAP analysis
 Reengineering
 Team training
 Testing
 Post implementation

2. Pre evaluation Screening

Once the organization has decided to go for the ERP system, the search for the
package must start, as there are hundreds of packages it is always better to do a
through and detailed evaluation of a smaller number of packages, then doing analysis
of dozens of packages. This stage will be useful in eliminating those packages that are
not suitable for the business process.

3. Evaluation Package

This stage is considered an important phase of the ERP implementation, as the

package that one selects will decide the success or failure of the project.
Implementation of an ERP involves huge investments and it is not easy to switch
between different packages, so the right thing is ‘do it right the first time’. Once the
packages to be evaluated are identified, the next stage is to develop selection criteria
that permit the evaluation of all the available packages on the same scale.

4. Project Planning

This is the phase that designs the implementation process. It is in this phase
that the details of how to go about the implementation are decided. Time schedules,
deadlines, etc for the project are arrived at. The plan is developed, roles are identified
and responsibilities are assigned. It will also decide when to begin the project, how to
do it and its completion. A committee comprising team leaders of each implementation
group usually does such a planning.

5. GAP analysis

This is considered the most crucial phase for the success of ERP
implementation. This is the process through which the organizations create a complete

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model of where they are now, and in which direction will they opt in the future. It has
been estimated that even the best packages will only meet 50% of the organization’s
requirements. The remaining 20% presents problematic issues for reengineering.

6. Reengineering

It is the phase that human factors are taken into consideration. While every
implementation is going to involve a significant change in number of employees and
their job responsibilities, as the process becomes more automated and efficient, it is
best to treat ERP as an investment as well as a cost cutting measure.

7. Team training

Training is also an important phase in implementation, which takes place along

with the process of implementation. This is the phase where the organization trains its
employees to implement and later, run the system. Thus, it is vital for the organization
to choose the right employee who has the right attitude- people who are willing to
change, learn new things and are not afraid of technology and have a good functional
knowledge.

8. Testing

This is the phase where one tries to break the system. One has reached a point
where the organization is testing the real case scenarios. The system is configured and
now you must come up with extreme cases like system overloads, multiple users
logging on at the same time, users entering invalid data, hackers trying to access
restricted areas and so on. This phase is performed to find the weak links so that it
can be rectified before its implementation.

9. Post implementation

Once the implementation is over, the vendor and the hired consultants will go.
To reap the fruits of the implementation, it is very important that the system has wide
acceptance. There should be enough employees who are trained to handle problems
that crop up time to time. The system must be updated with the change in technology.
The post implementation will need a different set of roles and skills than those with
less integrated kind of systems.

However, maximum value of these inputs can be realized if the system is

successfully adopted and effectively used.

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