Mr. Sridhar V, the Managing Director of Enmac Systems speaks about the challenges they encountered while executing HVAC projects, why they decided to implement GrowSmart, how GrowSmart helped them overcome the challenges and his future plans for Enmac Systems.
About Enmac Systems
Leading HVAC solutions provider based out of Chennai and now expanding across South India with projects in Tamil Nadu, Andhra Pradesh, Karnataka and Telangana.
Services rendered in different kinds of Air Conditioning systems like VRF, VMS, HVAC, Chillers specialised for hospital and hotel air conditioning.
Was awarded the “Most Promising Dealer” award by Carrier and the “Best Installation and Service” award from Toshiba.
100+ employees; 23 years of successful journey.
1000 customers and more than 2000 projects executed.
A complete solutions provider for HVAC projects.
Establishing cost control was one of the biggest challenges. Since material procurement was done without a standardised process, finding and plugging inventory leakages and thus ensuring cost control was difficult.
Used 3-4 different software for Accounts, Purchase, Service processes. Lack of an integrated end-to-end platform meant a lack of consolidated data. Hence, the team could not monitor and control different workflows effectively.
Streamlining of operations was another challenge because many processes were manually-driven. This affected the deliverables of both product and services. This in turn affected customer experience.
Improving the “Receivables Turnover Ratio” was another challenge due to lack of coordinated processes across the modules of Services, Projects and Accounts.
Preparing MIS was time-consuming and unreliable because data had to be collected from various sources manually.
Inability to visualise every stage in the Sales, Purchase and Projects workflows because they were not integrated. Frequently encountered delays in submitting bills on time, payment tracking, collecting dues etc.
Key Results with GrowSmart
20-30% increase in productivity.
15-20% increase in profitability.
20-30% costs saved.
About 30% increase in scalability.
90% reduction in customer escalations since proactive systems in place.
Since many manual-driven systems have now been automated, teams can concentrate on and improve customer experience.
Quick and accurate MIS.
Since decisions are data-driven - able to procure materials at lower costs, no more excess ordering and hence no inventory pile-up.
Conducting a month on month P&L analysis is possible with the data.
Improved customer satisfaction since going digital.
Improved ability to plan ahead and execute projects and services efficiently.
Key excerpts from the video
“So cost control for the projects has been really challenging from day one for us. We have been trying various methodologies to get the costs under control. But we were having ad hoc, kind of software. Moreover, for accounting we had Tally, we had service software, for purchase another software. So, we were really not having control over the project.”
“I would say 90% of escalations have been reduced.”
“Currently, we have more than 60 concurrent projects, whereas we were not able to execute more than 20 concurrent projects, while we were in the manual mode.”
“When GrowSmart came with the demo video, it matched with our entire business process. Right from, they told that it will come from Sales to purchase to project to accounts to stores, inventory, service.” - Mr. Sridhar V
Full Video Transcript
Currently, we have more than 60 concurrent projects, whereas we were not able to execute more than 20 concurrent projects, while we were in the manual mode. So, our scalability has definitely increased. We have now migrated to month on month MIS like a corporate. I would say 90% of escalations have been reduced. Definitely, increased our profitability (that is) tangible benefits. A marked performance improvement, I would say, nothing less than about 15 - 25%, in that range it would be. We are happy to say that some of the customers, we were able to reach them on time, do service in the way they would love and then get an appreciation letter from the customer. Something phenomenal in which we have transformed ourself from a so-so company to a professionally organised company. Major plus point is, I am free.
About Enmac Systems
Hi. Enmac is a Chennai based large air conditioning (services) company - a leading provider for HVAC solutions. We are based out of Chennai. And executing a number of projects in Tamil Nadu, Karnataka, Andhra and Telangana. We have more than 100 employees and we do all kinds of air conditioners, including VRF, BMS, HVAC, Chillers Fit-out works, chillers. We really specialize in hospitals and hotels air conditioning. So more than that, we have a good service background. We have more than 100 team members to cater to the customer's needs. And some of the important achievements being - we have got the most promising dealer award from Carrier and the best installation and service award from Toshiba. We have more than a thousand customers with 2000 plus projects executed so far. Well established in the HVAC industry with 23 years of experience in this line. And we have quite the market presence in terms of a complete solution provider.
Before implementing GrowSmart
Yeah, we are a project-based organization. Like we execute a number of HVAC projects. So cost control for the projects has been really challenging from day one for us, we have been trying various methodologies to get the costs under control. But we were having ad hoc, kind of software. Moreover, for accounting we had Tally, we for service we had some software, for purchase another software. So, we were really not having control over the project. So, we were really looking at something which will make our process simple and our life easier.
What were the challenges?
As I told you, Enmac is in the field of projects. And we are a key player in project execution of HVAC. So cost control has been the biggest challenge of the company right from the start. We realize that we are ordering materials on an ad hoc basis. And it was an on-site requirement and people are not going really scientifically. So that was then, we wanted to implement a new software and have a process that will control the project and also monitor the same. So it was that time we wanted to have... our focus, our requirement was a software that would control everything. Right from inventory, project monitoring, project costing, service, service calls, customer management and things like that. So that was our requirement for the software for the overall business.
How did you evaluate the software?
See like, when we were really in the market for the software we did have a lot of research going on like, we did try ZOHO CRM. My friends came up with the ERP software solutions, but nothing really matched the need of what I had. I had a certain kind of requirement in my mind, so nobody could match that kind of requirement in that software. It was all product-related or service-related, or inventory based accounting software. Nothing was an integrated platform. When GrowSmart came with the demo video, it matched with our entire business process. Right from, they told that it will come from Sales to purchase to project to accounts to stores, inventory, service. So, all were integrated into one particular software. So this was the entire thing, which was, I was looking for.
What were your expectations from the software?
One of the key features, which we're looking at by going for software was to have our operations streamlined. The major dealt issue was we didn't have a streamlined (process), it was on an ad-hoc basis. And people were operating in their own way. So, we wanted to have it streamlined. We wanted to have improved deliverables to customers, whether be it a project or be it a service, we want to have improved customer satisfaction. And also we had a challenge in terms of collectables, Accounts Receivables was a big challenge. We wanted to have a lot of improvement in that. And of course, as any businessman would expect higher and better profitability. When you look for software, what we looked at is, what is the value it can give it to you. Whether it will be value for the money? Yes, We thought that this will make value for the money.
How did you go about the implementation?
When we decided to go for this software implementation, we decided to have a deadline first. We wanted to start with say service (module) first. So, we kept a deadline of 3 months because so much data was there that was to be entered. So then we wanted to add modules and it went up to six months and then we wanted to have a complete implementation, which took about roughly nine months, I would say. And last three months we kept for validation of all the data. I would say around three months to one year was our period of implementation. Yes, first we started with the service module. Then we went ahead with purchase then inventory and followed by projects. Finally, Accounts. And Sales was one thing which we implemented at the last, very recently introduced.
Can you throw more light on how did you manage the transition?
Yeah, for service we started afresh. We practically ditched the earlier software and we started creating a new database. We entered the customer database, we entered the equipment masters, so it was a fresh start. We didn't take any copies from the previous system. So, we started fresh with Service. For projects,
what we did is, we started only the new projects in GrowSmart. We didn't take the old projects to GrowSmart. So we continued the old projects in the existing setup itself and all brought only the new projects. So that we were able to take it quicker into GrowSmart and of course inventory we did not merge with accounts in the initial stages. So we didn't have any challenge at that point. And accounts as such we ran parallelly for about six months. Once our auditor gave clearance and he validated it. Once he gave a clear ‘Go Ahead’ signal, only then we went live.
We understand that you stopped using Tally and migrated to GrowSmart?
Exactly, for about six to seven months, we were using Tally and GrowSmart parallelly. So documentation was being duplicated. Once we got everything validated, like the P&L, one year’s P&L we created in GrowSmart, just by entering the data. All of the Vouchers in the Tally were entered in GrowSmart and vice versa. We had the full record and once we were convinced that the accounting process was okay, only then we went live. As anything changes, people are always against it. The team goes against you. But sometimes you have to with an iron hand, take tough decisions. Also, we had some people engaged for data entry alone. This dedication was what I would say was the highlight. With dedicated effort, it really turned out well.
Results: Streamlined Operations
Before implementing this software, we were (the team) working in batches. So, it was a sales operation separate, the purchase will be separate, projects will be separate. With this software, with all in one software, we could merge everything. All the operations came into my laptop or my palm. So I could visualize every project, every state of the activity, every business activity online, I was able to view. And the decisions were immediate. We were really able to move, make faster decisions. Entire operations became a streamlined, payment tracking became easier. We were able to submit bills on time. We were able to collect on time, our billing cycle improved. We were doing all this on Excel, which is always a delay. And somebody will make the excel and somebody will update it. We never believed that what statement last time we studied and what reviewed is the same. Every time, we had a doubt in our mind, ok, there is something missing. From there we migrated to the current review mechanism from which really helped us so. Practically, I would say, all in one the package - the software which gave an end to end business solutions, it helped us a lot in our entire operation also.
Results: Impact on Productivity
Coming from manual working, when we were without the software, we used to take a huge amount of time to issue purchase orders, get the bills, work orders for labour. Everything was very manual driven and used to consume lots of time. And also we didn't have any control over the process. While this software definitely helped us in terms of improving the time, eliminating all the manual documents. We eliminated Delivery Challans, material inward, billing and so everything got removed. We were able to have everything in GrowSmart. Project wise, we have good control. Also now the scalability is available. Like, we are able to expand the project base with the same team. So, the backend office is fully established. So the plus point is that we are able to reach the customer. With the person situated at the customer place and at the backend office, we were able to service the customer well. Earlier the same person used to come to the office, take all the material and manual DC. Everything he has to do manually and then go to the customer. Now, my engineer spends more time with the customer rather than going for this documentation. That’s a plus point what we could achieve through this. Even in the service segment, we are able to tell the difference. In terms of taking the materials out and people wasting time, sitting and making DC and taking the materials. Now, it's quite automated and we are giving ‘float stock’ to the engineers, who are always on the move. So that's the plus point. Definitely, we have improved the productivity of the people. Well, I would say roughly 20 to 30% definitely there's an increase in the productivity of each employee. Because my team is able to handle more projects than earlier. They were bogged down by travelling and they were bogged down by so many internal processes. So the process delay has been eliminated and they're able to focus more on the site. So yes, capabilities have increased. The backend has strengthened and so which gives them the confidence to speak to the customer. So that's also a version of productivity improvement, I would say.
Results: Cost Control and Profitability
This is purely project-based orders. Every project is quite different in nature. The quantities are different, that kind of requirement is not standard. So, every bill of quantities with the order may be totally different than what is required in that site. There is a need to control the cost at every point, from planning to purchase, to execution, to billing. GrowSmart has helped us in terms of evaluating the estimated cost to the purchase cost. So we had really any time comparison between what is actually required for the site and what is actually available in the purchase order. Any such variation will be immediately notified and we will get an alert and we can always raise it with the customer. That is called the proactive kind of cost control. So we do have good control over the cost. Any increase, abnormal increase in the quantities, has to be notified to the customer for a price increase. Some of the mistakes, most of the project companies do is, they do not notify the customer when there is an abnormal increase. And there's a lot of debate at the end of the project, where the customer is not willing to pay the additional amount for the variation or the increase in the quantity, just because he has not been notified. So, after GrowSmart’s implementation, we have been successfully able to inform our customers - that this is the quantity going to increase, this is the cost increase and asks for an amendment or a variation (of an) order. And the mailers are there and we get the approval from the customer. It is quite helpful in controlling the cost, which you will be assuming that you will get at the end of the project, but ultimately most of the clients do not pay if they are not notified of the increase. They do not accept any increase later. So that has really helped us.
And inventory leakage assets, earlier in the manual system we know had ad hoc purchases. The site engineers will intend based on the site needs. He will not go in a scientific type, he may not even compare the BOQ. All those things are quite controlled. We have been able to procure materials that are lower cost, delivered to the project site, just in time inventory kind of thing, when only there is a requirement, we send the materials. So, quite effectively we are able to arrange the materials, what is required in the site. We didn’t order excess material and there were no materials coming back and no loss of revenue. So, you have no inventory pile up. These two things are really controlled now, even if I have to buy a kg of bolt nut, I will be buying just in time for that project. So that's the kind of control which we were trying to achieve. That's really helped us in terms of an increase in profitability.
I think the exact percentage is difficult to tell, but definitely the leakage, the inventory leakage part, the excess material ordering part we could save substantially. I would say, not less than 20 to 30%, we will be saving in overall inventory cost by managing the inventories. Just in time, reduce the additional materials like we used to send additional materials and then take back the materials - so that has definitely come down. We are supplying only what is required. And the effective purchase management in terms of getting the correct materials at the correct price. These three factors, I would say around 20 - 30% definitely there will be cost savings. With a reduced inventory cost, the savings we get on inventory cost reduced purchase cost. So, we were able to reduce the purchase cost, increased productivity with the same manpower. We were able to execute more projects with reduced manpower which reduced cost. The overall increase in project revenue has definitely increased our profitability, as tangible benefits. Remarked performance improvement, I would say. Nothing less than about 15 - 25% in that range it would be. Definitely, we have been able to get and realise the profit. One is unrealised profit and another one is realised profit. What we would say is, we are able to visibly see the profit.
Results: MIS and data-driven decision making
Before this software, we had only mind data. The data was stored in our mind. We used to work based on whatever numbers we used to carry with us. We used to ask for the numbers with our team, they used to take one or two days to get me the data. If I had to get the ledger of one particular customer, it used to not happen within one minute or ten minutes. It will take one day to get a ledger data for a particular customer. So we were in that kind of a situation. From there we have migrated to something like an automatic system. I don't have to ask anybody. I had to just see the ledger from the customer in GrowSmart. And it is all live and today all my records are up to date and on date, like any bill which has come today has been recorded. That way I'm very confident that all my data are validated. As well as, this data helps me in analyzing how the project is moving whether it's cash flow, whether it is a profitability or the project billing cycle. So, everything I'm able to evaluate through a single source data. Overall, month over month, it is helping me realize ‘What is the P&L?’. P&L we never used to do on a month on month basis. Whereas, we have now migrated to a month on month MIS like a corporate, which we were never able to do on a manual methodology. That is one major feature, which we are able to do.
We are able to discuss and review in our team meetings with the data. Like, ‘What is the sales of this month?’ ‘How much each person has contributed?’. Data like that was never available to us. Now, data is available. We are able to focus our attention to segmentation also. We are able to provide, ‘okay, this segment is giving us more business, so let us focus there’ or ‘This segment we are losing, so let us focus more to get more from that segment’. These are the decisions, we were able to arrive based on the data provided by GrowSmart. That's quite a helpful feature. Review mechanism, I would say it's one of the best outcomes of GrowSmart. Which we have been now successfully doing on a regular basis. The review mechanism has improved tremendously, which we were not able to do manually. Because we didn't have data at all and additionally what I would say is, this review has also resulted in better payment cycles. The billing cycle has improved, the payment, average, credit period has reduced. A lot of advantages. We are able to streamline our payment terms with the customer. Yes, this is the payment term which is viable. That way we are able to control our projects. One of the great features. Some of the tools which were connected on the dashboard are very helpful. Like we are able to see what is outstanding on a date? What are the collectables on the day? What is the payment due to the vendors? Those are the features which even in sales, with projects. So, engineer wise, we are able to evaluate. That helps us in improving day to day basis.
Another one of the major features, what are the advantage of the data. That we could really evaluate when we started the estimation of our tenders and in quotes. We had all the prices practically ready with past history. So that gave us a lot of confidence in terms of quoting. Whether to back the job or whether to quote the whatever margin we wanted. So, we were sure of our costing and gave us a lot of confidence in the market. We could kind of refuse some of the jobs, which will below cost. We were able to take up some jobs with a low margin but knowing our real costs. The data is like as our Senthil says, ‘Information is Money’. With the information available on your palm, we were able to convert it as a saleable proposition to the customer, giving the value for the money. That was one of the major important factors - the advantage of the backup. Another one in the service, lots of customers used to come back earlier telling that we did not carry out the planned services. Whenever we used to approach them for the maintenance contracts, they used to tell us that you didn't do the service. Now, we have the real data, we have the records, we have the copies of the information logged into the system. And not only that, we didn't have to come back to the office to take that. Our service engineer showed on the spot to the customer that ‘here is the data, here is the date where you signed, and this is your sign’. So that really helped us in converting the AMC orders really fast. So we were able to convert the revenue in terms of renewal contracts of the maintenance very fast. So the service side also the data, again, was very valuable for us. Not only that the costs involved in service. A 2000 rupees may be the service. We really did not know how much we really spent earlier. In the manual case, we never knew how much we spent. Now we know how much exactly we spent. Because even the visit of an engineer is recorded. And we know how many visits he did for years’ period. Based on, that we were able to make decisions on whether to continue the contract, give a discount or increase the price. These are the various parameters, which we evaluate to make good decisions for the betterment of the company.
Results: Impact on people dependency
Any company needs people for operations definitely. People's dependency is there. Since we are online always like the work is done. It's not that people are keeping the work pending. The bills and the process, everything is updated on a regular basis on a day-to-day basis. I don't have to really depend upon somebody, if I have to get some information for a particular customer or if I want to say, ’check a stock’, I don't have to go to stores and do a physical check. I just need to check my stock statement. Suppose, I need to get a customer’s ledger, I don't need to ask anybody,I have it on my mobile. So these are definitely my dependence on my team is reduced definitely.
And similarly, for my team, dependence on other people is much reduced because everybody's doing their job and it's all integrated at one front called GrowSmart. So, that really helps. I would say that we have realised that we are practical in auto mode. The company operates with or without anybody else. That's the scenario after implementing and let the system run from the last two, three years. It's practically an auto mode. It's system-driven again, except for the approval here and there. The major plus point is, ‘I am free’. I can go anywhere. I don't have to wait in the office and I'm waiting for the kind of approvals to be given, purchase order to be signed. So nothing is required. (The need for) my presence in the office is totally eliminated. So, I'm redundant!
Results: Customer experience
Like any other company, when the world was moving to digital, yes, we also moved. Definitely, with the help of GrowSmart, lots of things we could change. For example, sales, quotations which we didn't have a standard format. We did standardized templates on GrowSmart. Our team was able to send an offer by mail on GrowSmart on the go. So we didn't have much delay in terms of sending quotations. Similarly, in terms of service estimates, we are able to send it through the software itself, to the customer, get the approval on the mail and start the service.
Similarly, accounting bills - the digital thing. Accounting bills is been sent on the mail, the statement of accounting bills is being sent through GrowSmart itself.
A lot of activities we have been able to achieve digitally and thereby eradicating the complete use of manual DCs. Overall, I would say, we had an everyday firefighting situation. Every day, we need to wait, today we have to do this, today we have to do that. It used to be a firefighting exercise, we were never able to plan. Now, we have got additional time to plan for things. Now, we are into advanced stages. Advance planning - we plan for the service for the next day. Things are in our control. So, the software brought us to a stage where we are in control of things. Earlier, it was not in our control. It was in god’s control. Now we have the situation in our control. The escalations have come down, the client escalations have come down. We are able to arrest it at the level one itself. It has been dramatically reduced. Also, we have got a lot of testimonials from our customers on the way we are approaching them. We've got more time to do all these things. So definitely the customer experience has been a good one and we have got testimonials from various customers on that. And also the market is aware that this company is taking up the projects in a kind of a process that is required to execute the projects. So they know that this is a professional company, which is going in an ordered way. It's not a kind of a company which only runs on owner based decisions. They have a process set up. It helps us to convince the customers that this is a professionally organized company. Due to improved service reach out, outreach to the customers we are able to reduce escalations, I would say 90% escalations have been reduced. It doesn't come any higher up. It is just getting closed at the lowest level. So we handle only possibly a few customers who get escalated. Those calls get escalated. We are happy to say that some of the customers we were able to reach on time, do service in the way they would love it. And then get an appreciation letter from the customer. Something phenomenal where we have transformed ourself from a so-so company to a professionally organized company. Thanks to GrowSmart for the same.
Results: Revenue growth and expansion
We were at the time of implementation, about 2,800 square feet of office area. Today we are about 8,000 square feet of an office area. A much larger working space, with more team members. Currently, we have more than 60 concurrent projects, whereas we were not able to execute more than 20 concurrent projects, while we were operating manually. So, our scalability has definitely increased. And also with this support system at the back end, we are quite confident of expanding our business. Enmac plans to have its own trading center, to develop the skill of the people who are getting out of the college or from ITI. We plan to upgrade the scale for employability. And we also give them kind of employment over here. So that's another thing which we have got the time and patience and energy to think about such projects.
Also, we plan to expand all the three southern states like Andhra, Telangana, Karnataka, beyond Chennai. Now, we are looking beyond Chennai. We are already executing a number of jobs from Chennai at places like Hyderabad, Vizag, Bangalore, Chittoor, Thirupathi so on and so forth. Our scalability has definitely improved with possibly the same manpower. I don't need another accountant sitting in Hyderabad or Bangalore. So that has been definitely a plus point. Also, as I told the market perception has definitely improved a lot because our capabilities have increased and we have scaled up our operations.
About GrowSmart Support
Across all our service providers, GrowSmart has the best support that we’ve had. For example, your promptness to listen to our queries and resolve them very quickly. So that's one of the features that we've been looking to implement in our service. And that is, to be frank, that is the benchmark that every company in our industry, looks to implement.
There is always someone to rely on to provide the clarity of our issues or resolve our issues. So to name a few ones is Varsha, Shiv Sagar, Dhamotharan. They are always there to take up ownership and resolve the issues in a very structured manner, as quickly as possible. So that is an experience, which we would like to implement in our business. And we hope to do it one day.