How a Robust IT Foundation Helped boAt Achieve 2x GrowthFaster, Higher, Stronger IT Strategy Boosts Growth of boAt Brand in India
To support its business expansion plans, Indian consumer electronics retailer boAt needed an IT infrastructure that would enable robust, digitalized and automated processes. Faster customer response, real-time visibility and process efficiencies were key requirements.
boAt is a lifestyle Indian brand for audio accessories like headphones, earphones and speakers. It also manufactures smartwatches, travel chargers and premium cables. Supported by its three-point IT strategy, its business doubled for two consecutive financial years in 2021 and 2022. boAt's revenue from operations shot up 2.2x to INR 2,873 crore (approximately $348 million) during the fiscal year ending March 2022.
boAt attributes its growth to an ERP solution, a data lake and a customer experience management solution. But a unique IT strategy helped.
Faster, Higher, Stronger
When it set out to revamp its IT infrastructure two years ago, boAt adopted the Olympic tagline Citius, Altius, Fortius (Latin for faster, higher, stronger). This strategy is aimed at achieving three goals:
Stronger - Explaining this strategy, Shashwat Singh, CIO, boAt, said they needed "a very solid and stable technology backend" to facilitate their core processes.
Faster - In a fast-moving consumer electronics industry, where product lifecycles are in weeks, faster customer response is crucial.
"It became crucial to listen to the voice of the customer as customer service is core in our industry. We wanted to react to customer dynamics faster," Singh said.
In its pursuit to revamp the customer experience, boAt implemented a customer experience management tool called Sprinklr.
Higher - boAt also has high aspirations for its top-line and bottom-line improvements, powered by technology.
The first step toward this three-point strategy was to deploy a best-of-breed ERP solution. Before that, boAt used a legacy ERP solution that could not scale to meet the needs of the growing business.
But first, there were some challenges to overcome. A lack of integration across discrete solutions meant the company had to compile financial and inventory reports manually. This was time-consuming and resulted in delays, and the absence of up-to-date figures on areas such as stock availability affected employees’ ability to make timely and informed decisions.
"Our system of accounts and system of inventory were two different systems, and that was the biggest challenge," Singh said. "Further, the ERP used then did not do stock accounting, and the warehousing tool was not integrated with the ERP."
Due to the lack of integration, real-time visibility into stocks and financials was a manual and time-consuming effort.
"The priority for us was to get all our core business processes onto an ERP platform," Singh said. They had to digitize core business processes such as order-to-cash, procure-to-pay and record-to-report - and bring all these together on a single platform.
To address these issues, boAt opted for an enterprise-grade ERP that would provide a robust and scalable digital foundation. In addition, the company wanted guidance on best practices that would enable it to run intelligent and efficient business processes.
Apart from ERP, the boAt IT team also set up a data lake for the enterprise, because it wanted to unlock the entire reporting spectrum, beginning with operational/descriptive reporting. It opted for a tool called Byte Prophecy, a proprietary, full stack data analytics tool from Accenture. The outcomes expected from using this tool would be predictive-prescriptive insights.
After a thorough evaluation process, boAt opted for SAP S/4HANA Cloud through the RISE with SAP solution. A key consideration in this decision was the expertise of the vendor organization. Other important factors were the ability to tailor business processes to boAt's unique requirements, and the flexibility to use any cloud provider with the solution.
"One criteria for choosing SAP was the strong partner ecosystem. We were looking for a partner who is more adaptable and flexible to work with smaller companies. Second, it is a true cloud offering and the infrastructure is managed well with RISE with SAP. That's certainly helpful for smaller organizations that do not have dedicated IT staff to manage the IT infrastructure. Third, the solution had the feature set that we wanted," Singh said.
To help deploy the solution, boAt selected Intellect Bizware Services. The selection criteria being extensive experience with similar implementations and the use of accelerators, which would significantly reduce the deployment time.
While implementing the solution, boAt encountered challenges, though these were not product-related.
"It was more to do with change management and data due to our fragmented processes," Singh said. "The biggest challenge was getting all of this to be able to do a smooth cutover into an ERP."
The new ERP solution was deployed in six months and went live in April 2022. boAt has already realized certain benefits and efficiencies.
Benefits and Efficiencies
The benefits are qualitative but Singh expects these improvements will have a positive impact on its top line and bottom line over time.
With data consolidation and newly introduced process efficiencies, there is now "a single source of the truth."
"Process efficiencies have improved significantly. Overall governance and controls around all of these processes have also improved," Singh said.
The order-to-cash process, procure-to-pay process and record-to-report are fully digitalized and included in a single stack. This provides real-time inventory visibility across channels and warehouses, improving the efficiency of supply chain operations.
"I can see the demand at any point in time vis-à-vis how many purchase orders have been sent to our supplier and how many of these have been converted. I can see how many of these have been sold forward. So there is process transparency. Timelines have also improved," Singh said.
An integrated view of financials and stock positions means teams can no longer bill for stock that is not in the warehouse, lowering the risk of disappointing customers.
Over time, the company anticipates this increased transparency will help it manage inventory more efficiently to reduce stock and working capital.
Reporting processes have also been accelerated, with month-end closing taking just 10 days, down from six weeks, resulting in 60% faster monthly closing. And with employees no longer having to painstakingly reconcile figures across different solutions to generate reports, there is now more time to spend on higher-value tasks, such as analyzing trends.
Automated pricing workflows help ensure greater control as well as consistency across different channels. Meanwhile, automated and fully auditable purchase-order processes with two different levels of approval improve compliance. The added approval checks help ensure purchase requests are made at the correct price and only after the current inventory position has been assessed.
Visibility into the supply chain was also crucial. So boAt started "serializing" all its products by attaching tags or stickers with QR codes. Singh said the purpose was two-fold: they could now track the product as it moved through the supply chain. This also provided "upstream value addition" as they could now ask customers to scan the QR codes on the products they purchased and register for a warranty and provide feedback about the products they purchased.
boAT plans to expand its SAP software landscape by implementing the SAP Extended Warehouse Management and SAP Transportation Management applications. Integrating these solutions with SAP S/4HANA Cloud will increase transparency by putting real-time business information at employees’ fingertips. The company is also considering other SAP solutions to digitize its processes and workflows.