ACG teams up with HP to make internal business processes more easier to operate and transparent

ACG Worldwide is a 40-year-old company that provides the complete package of solutions for the pharmaceutical industry, from empty capsules to granulation and coating, to capsule filling, packaging films, blister packing and carton packing. Over the years, thanks to constant innovations and improvements, ACG has grown manifold and is today one of the largest manufacturers of hard gelatine capsules worldwide. In fact, the company has some of the world’s biggest players in the pharmaceutical industry as its customers -- Glaxo, Ranbaxy, Pfzier and Aventis being some of them -- while on the packaging side, ACG counts HLL and Colgate as its customers.

All the hard work has paid off. Today, ACG Worldwide comprises 10 group companies, including two subsidiaries — one in the US and one in Indonesia, and nine factories in India with a staff strength of over 1,200. It has registered a healthy growth rate of 25-30% in the last five years, and the gross company turnover was Rs 600 crore in 2004-05.



As with any organisation of such wide reach, ACG started feeling the need for an enterprise resource planning (ERP) package in the late nineties. Its requirements arose out of the fact that there were several processes in the company that needed to be accessible by as many departments and people. Says Nitin J Parekh, General Manager IT - Corporate, ACG Worldwide, “We had a number of legacy systems that were not integrated. In addition, we were spending a lot of time in modification of systems, generating MIS and other reports.”



ACG opted for a package by Ramco Marshall in 1997, and this system went live in 1999. However, ACG realised the limitations of the Ramco package as it did not address all of the company’s long-term requirements. “Also, because we supply to pharmaceutical companies all over the world, including the US, our systems had to be compliant with the Food and Drug Administration (FDA) norms,” adds Parikh. This condition was not met by the Ramco package. ACG decided to upgrade its ERP system to international standards, so that it could cater to its customers’ requirements. The company then implemented an ERP package from SAP. Implementation started in mid-Nov 2004 and the system went live on May 1, 2005

The Choices

The company’s IT team of eight, headed by its director Karan Singh, then had to decide on the vendor and platform, and they narrowed ACG’s choices down to two companies. Says Parekh: “There are a lot of issues involved when choosing a system, in terms of security and viruses. We brought it down to IBM and HP.” The ACG IT team’s top priorities were upgradation, migration from one platform to another and availability of server through the year, 24x7, 365 days a year. Each member of the IT team graded the companies on the criteria set out, and in the end, the company with most points was chosen (see table below).

Further, the IT team listed the number of customers IBM and HP had, then interviewed them for their reasons for opting for a particular company, and finally, asked for feedback on how their chosen systems were doing.

HP — The Chosen One

“HP was the clear winner,” says Parikh. “HP has a titanium server that offers easy migration and easy product portability, whereas IBM has a proprietary architecture — the I-Series — which is pretty useless as it does not offer easy upgradation. We, therefore, chose HP for its easy upgradation and migration capabilities.” The HP 9000 series was chosen as the platform (see table below).

“Besides, our implementation partner also recommended that we opt for HP. It is in our contract with the implementation partner that we should be in agreement on the vendor and the platform, as both should have the expertise to implement it,” he adds.



Today, Parikh is satisfied that ACG opted for the right vendor. “The installation process was extremely smooth. We called Bangalore and the next day an engineer was here. The installation took just one hour — there were no blockages and whenever there was an issue, support was provided immediately.” ACG also realised that HP scored over its competitors with regards to monitoring or creating of devices, as all of these processes were possible online.



As expected, ACG has benefited immensely from the implementation. “Our customer ledgers, vendor ledgers, daily production reports — all these are very accurate and clear. Earlier, if the accounts department wanted to see what the production numbers of a particular product were, it would have to go to that particular department to see the physical records. Today, it is all online,” says Parikh, adding, “Systems are now easier and more transparent.”



He sums it up by saying that HP “partnered us in our requirement and was not simply a supplier”.