“Cloud ERP, needs of every enterprise”: Mr Nityananda Rao, CEO, AcTouch – Interview

AcTouch Technologies is one of India’s well known fully-integrated Cloud ERP (Enterprise Resource Planning) platform built for providing end to end SaaS (Software as a service) services to SME’s. Based out of Bengaluru, AcTouch was founded jointly by Mr Nityananda Rao, a Software veteran with more than two decades of industry experience & his partner Sunish Ankolekar, a marketing genius to bridge the gap in the ERP market that merely focussed on accounting solutions & not really addressing the needs of a business owner. Thus began the journey for AcTouch & launched their products in 2014 to provide a holistic approach in assuring true value to the ERP requirements of SME’s.

The product and services offered by AcTouch range from automating key functions of Manufacturing and Trading Businesses like Inventory management, Import and Export, Billing and Invoicing, Manufacturing process like Production, Sub-contracting and Job work with Financials like Payments and Receipts and many more. A recent addition to the list of services is the Mobile Apps for Sales Force and Dealer Management programmes.

The Cloud ERP software by AcTouch enables SME’s to perform day to day business operations by integrating all necessary processes into a single platform.

AcTouch has a client base of 200+ customers and is associated with big names such as IIM Bangalore (MARS Team), URDoorstep.com, Magiccrate.com, RenewIT systems, Energy Efficient Lights, AdPac etc…

In its introduction, the AcTouch further added, it enjoys a market advantage in the Manufacturing segment, as it is one of the very few players to offer customised Cloud-based ERP solutions for the sector. 45% of the customer base is from medium to large manufacturers such as IM Safety Products, Small Motors, Woodmac Industries, Asian Cranes, Good Good Manufacturers, Kelvin Bikes and Champion Extrusion etc…  Furthermore, the AcTouch is confident that 2019 will be the game changer with robust marketing plans in the cards. The company is all set announce Free GST software to tap the 6.8 crores SME market to get maximum traction and brand awareness before the end of the current financial year.

This brief introduction of the AcTouch doesn’t end here. As the Cloud ERP market is not a confined place, lots of foreign and homegrown players keep competing to provide the best possible services to proliferate the reach of small and large enterprises of India. To this context, we had an interaction with one of the founders and CEO of AcTouch technology, Mr Nityananda Rao to know more about the AcTouch and Cloud ERP market.

 

1. Being the supreme head of the AcTouch, how was your experience, so far and what is your vision for it?

We started a SaaS product for SMEs with a clear focus to cater to a customer segment of fewer than 5 Employees with a turnover of USD 5M. So the features that we developed are Sales, Bills, Inventory, Financial and Reports etc.

Soon we realised that this was a wrong model, as the product features and complexity of the business is same across the customers from US$ 1M to US$ 250M as the number of process or steps to follow are all same. Only the volume of work changes, but the complexity of business or process are same. So we had to change our business model and had to enhance the product with more features like Manufacturing, Planning, Quality, Quotes, Online Interface to Marketplace products, Post sales Warranty etc. to meet customer demands.

It’s been a roller coaster ride for the last 6 years as we are still trying to do a Market-Product fitment. The SME market that we are catering is a very diverse set of Businesses. But today we cater to nearly 25 verticals of SME business.

The journey is full of learning and lessons for us to focus on customer needs rather than selling cutting-edge technology. Many are technology averse, but have clarity on what they want and how they want. So it’s a different experience.

We are trying to build the TRUST factor in the SMEs decision-making process with our Cloud ERP or MobileApps such that they can focus to use the application without any issues or concerns.

 

2. Could you please give a brief about AcTouch cloud ERP service & technology and how is it different from others?

As you might be aware, ERP is a RED OCEAN and there are 1000’s of vendors who sell ERPs of all varieties. We have built product features like Sales, Quotes, Billing, Inventory, Payments and Receipts, Manufacturing module with Planning, Work Order, Bill of materials, Subcontracting, Finance, Interface to marketplaces like Amazon, eBay etc and all the financial MIS reports. Most of these are developed with Customers as subject matter experts as we believed in their feedback and simplify the process.

How are we different? We focused on the following and built customer TRUST on us.

1. The solution in Progress (SIP) – These features list are same like many of the existing ERPs like the handling of Invoicing, Billing, Payments, Receipts and Financials etc. However, we focussed on the end users usability and how to simplify the process by studying end users behaviours.

2. Identified problems – These are the problems that are known in the existing products, but no one spending efforts or money to change it. We focused on this segment to win few customers and that helped us to gain more customers.

 

3. Since the inception of AcTouch, what are the transformations, the ERP industry has gone through?

Interesting question. There are many advancements been happening in the ERP Industry with a major focus on the following two areas.

1. Transaction-level changes

2. New technology level Changes

On the transaction level, the SME started changing their focus and moved into Cloud-based Solutions. They started seeing the saving in Money and Resources and move out of old technology as they started questioning ROI of an ERP implementation. Many realised that its good to depend on good vendor rather than manage everything in-house team.

On a technology level, SMEs started adapting to new technologies to simplify their process and increase productivity. It became a Social recognition for SMEs to move into new technologies like Cloud or use Mobile Apps for their Sales Force or Dealers etc.

1. Cloud technologies and deployment models

2. IoT – Internet of things connected to Machines and getting the data directly

3. RFID and other tools to increase productivities

4. People started using Social media as an enabler to get more customers. They started using CRM, Mobile Apps for Sales Forces, Mobile Apps for Dealers to place their order online etc.

In some of the above cases, the old Businesses houses are forced to change themselves and move into Cloud Technologies, as many surrounding solutions are available only on Cloud and their Interfaces like Salesforce Mobile Apps, or Dealer Portal and getting their orders online and update their ERP etc.

So these are some of the changes the industry has seen in the recent past.

 

4. How do AcTouch Software solutions help enterprises in growing their customers?

As I explained earlier, we focused on two areas ‘Solution In progress” and “Identified Problems” and found a way to solve them. There were cases, where the problems been identified, but no vendor took the initiative to fix them.

As the competition is increasing the business owners profit margin is shrinking and he is forced to use the technology and use the existing resources to fulfil his process and improve customer relations.

What we do is simplify the business process with controls and measures that help Business owners to develop a good relationship with his customers by on-time product deliveries with fewer defects and good quality.

This process simplification and controls helps Enterprises to manage more customers, but need not increase the Overhead and Resource Costs.

 

5. What kind of role is playing by the artificial intelligence and learning in ERP?

Please note that a typical ERP is a Transaction based system that stores all the data from Sales, Purchase, Inventory, Production and Finance etc. It is more of a control system to collect the right amount of quality data that helps the management with few reports that indicate WHAT HAS HAPPENED.

It is not an analytics system. There are attempts been made to integrate an ERP with other business intelligence tools to arrive at some decision making process. Again these are sort of “Postmortem reports” and not a real-time report.

This is where the AI kind of features comes into effect. One of the important roles played by an AI tool is towards the analysis of historical data and project the futuristic situation. But this is not easy except that AI requires a huge amount of input data to analyse and self-learn from different situations. To be effective even for an AI tool to requires data of the last 2 to 3 years.

Typically, it looks good to say, we use AI, but how much its effective and what value addition it does to business will take time.

 

6. Core differences between the AcTouch ERP solution package for SMEs and larger enterprises?

We focus on the “Solutions in Progress” and “Identified Problems”. The first set helps us to compete with other vendors by simplifying the application usage process, the second part helps us to build and win the niche customer segments. We have developed an interface to Amazon Seller Central, developed data interfaces to many other Marketplace products, developed open API for anyone to interface to our ERP by mobile apps etc.

Today we don’t see any differences between SMEs and Large Enterprises, as the process and complexity of business activities are the same across both. Except for the volume and the number of people remaining parameters are same. Today we have customers ranging from a turnover of USD 100K to USD 50 Million with more than 100 users etc. But the features and functionalities remain same.

 

7. What are your future plans with AcTouch?

Some robust business plans are on the cards to grow AcTouch in India. We have identified a business opportunity where the 50M+ SMEs don’t have access to Computers to install base software. Addressing this challenge, we have a major announcement coming shortly that will revolutionise the operations of SMEs in a big way. They have currently released the beta version of the product, it will be soon available for customers to use.

We built multiple revenue playbooks around this product and it has seamless integration with our Cloud ERP, in case the customer decides to move to large ERP products. (We will share the news of the new product with H2S in a month’s time)

Apart from that, we have identified a few niche areas like Dealer Management, Sales Force Apps etc where the data is tightly integrated with ERP solutions and we see the demand.

 

8. What are the challenges of enterprises facing while migrating from traditional platforms to cloud ERP?

There are multiple issues

1. Employee’s Internal resistance to change. Many SME employees are averse to technology and they are always scared of losing their “Power” in the company that they built over the years. So they don’t want any changes.

2. Internal IT manager, who could be losing his power and job if the company decides to move to Cloud Solutions.

3. Change in the internal process that’s been built due to the lack of features of Accounting software or some other customised one.

4. Customisations in the local software wouldn’t be available when Enterprises moves to new Cloud ERP software.

5. Commitment from Business Owners with a timeline.

6. Mismatch in available Data and expectation across the stakeholders. Many employees think that all of their existing problems would be resolved as the new ERP comes into play.

7. Fear of data losing and loosing of Internet connectivity. There are few instances where the network in India is missing for days and this could be a genuine case for the business to decide to move to 100% cloud-based solutions.

 

9. Should enterprises adopt a Hybrid ERP model or completely move to Cloud ERP?

This depends on each Business and their need for the data to analyse and process. From a business perspective, a business can move to a Hybrid Deployment model (where the data is kept at both local machine as well as on Cloud Server), if

1. They want a copy of data that’s made available LOCAL for security reasons

2. They have an intermittent Internet and stability issues. So they want to work offline mode and reconcile the data when the Internet is back.

3. They want to use these data for some other analysis that’s not available in Cloud Solutions.

However the Hybrid solution has its own problems and it will not solve the current problems of having more resources, network or data accuracy issues. It could multiply the issues.

Personally, I recommend going for 100% cloud as there is NO data at local machine and all are available 100% at Cloud and is safe.

 

10. ERP social media integration began to make a comeback in 2018… What is your take on this?

Today a traditional ERP do not need a Social media interface and we have not seen many SMEs demanding this. Typically social media is used for Marketing, Leads generation, prospecting, closing deals etc. There are CRM tools that are available to handle them and you don’t need an ERP for this.

Earlier days, there were many information those were confidential like price lists, Inventory stock available etc. and they were not freely available. Now a day due to social media, its ability to reach out to many people at less cost has made many ERP vendors to sit-up and monitor on “what is happening” there.

Today a business owner wants to have a 360 degrees view of his customers, what they do and what they like etc. So it is important to know my customer personally and that could help me to build my business and sell more. For example, a customer who buys Steel Materials from me has stopped purchasing from me, but I see that he is asking for more details in our Business group or requesting details in FB pages.

This is an alarming situation and would be interested to meet the customer and see what went wrong from our end. This could resolve the issues and generate more business.

So integrating some details of Social Media would make a difference to Business owners. So ERP is an enterprise solution this interface could help.

 

11. Would you like to give us a glance of AcTouch market share?

We are at a small number today but have the right intention to capture at least 5% market share in 5 years.