Men at the Indian textile supplier Arvind Dyeing & Bleaching Mills sit on a raised floor writing in paper ledger books because computers aren't completely trusted. At the same time, others at the plant use not only computers, but also a cellular phone order management system that dramatically reduces processing time.
Arvind represents the cultural and technological integration of old and new India, with its challenges and innovations.
The company keeps records on both computers and paper because electricity outages are all too common, as I noted in my previous blog about cellphone software in India. Writing with pens and pencils is both inexpensive and traditional.
Nikhil K. Gadhia is an agent for Arvind who maintains paper records with multiple carbon copies. But as he works away from his office two or three days a week, he also uses Nokia's Tej order management software on his cellular phone.
Agents like Gadhia are classic middlemen. They can work with several groups within the textile value chain: suppliers, such as Arvind, who produce yarn and fabrics; wholesalers/dealers who distribute the goods; and retailers.
The agents must evaluate hundreds of fabric and color combinations, a multitude of prices, and different types of packaging from multiple suppliers. Agents negotiate and place orders -- generally with lots of back-and-forth verbal communications to avoid ambiguity. Then all the orders must be tracked
as they are processed and shipped across the country.
Gopal Marda, executive director of Arvind, told me (and Mumbai blogger and market researcher Dina Mehta), that his plant often gets orders more than a week after an agent receives them. Agents travel frequently, and it can be several days before they are at a computer, a fax machine, or a mailbox. Most agents don't have computers, and many orders are mailed.
An agent who uses Tej can receive and place an order, and get a confirmation, in less than a day. Faster order processing also results in faster payments for suppliers and agents. Marda estimates sales have increased roughly 20 percent to 25 percent because of Tej. However, Tej doesn't provide any electronic funds transfer capabilities for even faster payments.
Nokia hosts Tej, which uses SMS and slow GSM GPRS for messaging and database access. The software is designed for the slowest possible cellular coverage. Even so, technology can't replace everything. Wholesalers and retailers still want to see and feel fabric swatches before placing orders. Tej doesn't display photos of fabrics. Also, many agents use CDMA cellphone service, and Tej is for GSM.
Nokia has been developing Tej for several years and is in beta testing with hundreds of suppliers, agents, and salespeople. Commercial deployment is slated for this quarter, and the Finnish company is still deciding on prices.
In the most likely scenario, suppliers, who make the first decision to implement Tej, which they offer to their agents, would pay a monthly fee as well as per-agent fees.
Could Tej lead to changes in India's textile business? The entrenched players -- agents, suppliers, retailers, and, yes, Nokia -- don't want to rock the boat. They just want to make it more efficient. But Tej generates greater enthusiasm from younger textile executives who are more comfortable testing technology.
With agents being able to access huge amounts of data on cellphones, including pricing and availability, could agents become more influential by "playing off" -- albeit delicately -- suppliers against each other?
When I was in India, the few textile executives and Nokia officials with whom I spoke said the business wouldn't much change because of Tej. They emphasized the longstanding tradition of the textile industry that's built on "trust."
But I wonder if trust will be trumped by profits. It's a tough business.
[Disclosure: Alan Reiter is a participant in Nokia's "blogger relations program" and was invited to India to learn about Nokia's new cellphone software and services. Nokia paid Alan's expenses, including transportation, hotels, and meals. He was not paid any fee.]
— Alan Reiter, President, Wireless Internet & Mobile Computing