Interview - Digitization: Immense Scope
Coal India Limited (CIL) is planning to go totally digital by end of Dec, 2016. In your opinion, what would be scope of digitization in your organization and its impact on CIL’s business?
Yes, we are geared up for e-office, which is Digital Workplace Solution that replaces the existing manual handling of files and documents with an efficient electronic system. The upside is, it will have a positive impact on operational efficiency, greater transparency and quicker decision making. The process would also bring in greater employee, vendor and consumer satisfaction.
What are the key digital initiatives that CIL has implemented to streamline the value chain - procurement, tendering, auction, marketing amongst others?
Coal India had adopted a host of Information and Communications Technology initiatives to make internal processes IT driven. E-procurement for goods, works and services through e-tendering is already operational in the company in a transparent manner. Procurement of goods of more than INR 2 Lakh value is done through e-tendering. The Reverse Auction on e-procurement platform has been implemented in Coal India and its Subsidiaries since January, 2016 for tender values of INR 1 Crore and above. E-procurement and reverse auction has already yielded above INR 800 Crore saving for the company during last years.
In a step towards consumer friendly approach the company has launched a Web Portal ‘Coal Allocation and Monitoring System’ during FY 16 aimed for the benefit of Small & Medium Sector Consumers.
Coal India has also rolled out linkage auction for non-regulated sector consumers like captive power plants (CPPs), cement plants, Sponge Iron Units, fertilizer, chemical and many other industrial units, not having linkages or whose Fuel Supply Agreements have expired. The benefits include option of choosing specific grade of coal, preferred source of supply, mode of transport etc.
What is the overall scope of digitization in the coal sector? How do you think this will give competitive advantage to the Indian coal industry as compared to global peers?
For the size of a company like Coal India, encompassing expansive and expanded operations, the scope of digitization is immense. The point is to adopt the digitization processes that are best suited to the company, which we are pursuing attentively.
Besides the e-Procurement and e-Auction initiatives, Coal India is leveraging ICT for many other business operations as well. The major CoalNet modules like payroll, finance, material management, personnel, production, sales & marketing have been implemented along with ERP which is rolling ahead on full steam. To prevent pilferage of coal, GPS (Global Positioning System) based Vehicle Tracking System in coal transport has been implemented. Electronic Surveillance through CCTVs at weighbridges and other vulnerable points is on the verge of completion at different subsidiaries of Coal India. To restrict unauthorized coal transport, vehicle weighbridges are being connected through wide area network to use allow RFID (Radio frequency identification) tagged trucks.
The whole idea to widen the consumer base, improve productivity, supply increased quantity with quality, to make grade slippage a thing of the past, reduce the operational cost, decrease the dependency on imported coal. All these efforts, as a naturally corollary, would help gain competitive edge while facing global peers.
CIL operates in a technology intensive sector. In your opinion, what are the policy enablers to accelerate the adoption of digitally enabled global best practices by Indian Public Sector Enterprises?
Like I mentioned earlier, Coal India has rolled out the implementation of ERP as a policy enabler which would be in sync with future needs of the organization to standardize and modernize the business practices, across all its subsidiaries. At the cost of repetition, I assert that, what is important is we are adopting system enabled best practices that are suited to geo-mining conditions of the company.
This will enable improved cycle times, efficient asset management, expense control, inventory reduction, better employee and customer relationship, improved quality of decision making, transparency, compliance, standard and streamlined processes, and business intelligence.
Coal logistics – handling, transport, last mile delivery are rapidly evolving due to process mechanization and online applications. How is CIL aligning with this new paradigm in the coal industry?
I would say in a responsive and responsible manner with a proactive approach. Technology infusion in coal mining operations is a continuous process. Where ever there is need for technology enhancement or modernization the company has always seized the opportunity to implement it for operational ease and efficiency. We are always open to adoption of latest technology and innovations.
How will digital enablers like 3D models of mines and geospatial technology enhance productivity and lower costs for coal extraction and land reclamation?
Digital enablers like 3D Mine modeling tools facilitate a high level economic evaluation of open pit mining operations, or new projects by maintaining versions of the design process to communicate the design details effectively to all stakeholders.
In the process decision making becomes easier, faster and accurate through better interpretation of data with powerful visualization tools and graphical displays. This would help us in lowering our costs.
Mines’ safety is of paramount importance in the coal sector. How is CIL leveraging digital or online solutions in this regard?
Yes, safety of our miners and mines is our foremost concern. We are focused on increased use of digitized interface in perfecting critical processes that have a strong bearing on basics of mine safety. Such as, use of software for mine design, improving accuracy in mine surveying, geo-fencing, communication as well as monitoring conditions of mine site through remote sensing technology.
We are also using several online monitoring systems for analyzing real time conditions of underground mine ambience through use of Environment Tele Monitoring System (ETMS), Local Methane Detectors (LMD), tracking the positions of transport vehicles at different locations inside large opencast mines through GPS based OITDS. One Miner Tracking and Communication system is on trial at one UG mine of Coal India.
With digital interventions, Indian businesses are seeing improvement in customer experience, productivity and turnaround time. In your opinion, what should be the strategic focus – disrupting with new technology or improving existing technology for competitive advantage?
We all like innovations and improvements, especially when they add value to our business processes. We are always on the lookout of opportunities for improvement, whether it is in a product or aligning our operations with latest technologies. Unless we latch on to the tide of new as well as improvements in existing technologies, both of which are important in my opinion, there is a danger of stagnation. From time to time we experience massive technology changes which are disruptive.
Introduction of ERP in CIL is an attempt to bring about Non Disruptive innovation with Disruptive Technology.