Helping Dabur India
achieve high performance
Dabur India Limited is the fourth-largest
consumer packaged goods company in India,
offering a wide range of health care, personal
care and food products to customers in more
than 50 countries. Dabur is also the world’s
largest manufacturer of Ayurvedic medicines,
which are based on an ancient Indian system of
health care, and promote natural and holistic
living. The company reported 2007 revenues of
more than US$543 million.
through operational
excellence and
competitive advantage
Business challenge
Consumer packaged goods companies operate in
a global marketplace that is highly competitive
and commoditized. These organizations need to
work smarter, perform better and make faster,
wiser decisions than ever before. Dabur is no
exception.
Nearly five years ago, Dabur clearly identified
these challenges and set out to outpace its
peers in the industry in terms of revenue and
profitability growth. To build a competitive edge,
the company asked Accenture to help identify
specific opportunities that would lead to short-
term advantage and long-term growth. Accenture
was well suited for the task. In addition to its
highly respected business consulting skills and
deep industry insights, Accenture brought a
solid understanding of what companies need to
do to achieve high performance in the
consumer products sector. This under-
standing is based not just on Accenture’s
global experience, but also on its
ongoing research into the character-
istics of high-performance businesses.
Accenture’s research indicates that high-
performance businesses relentlessly
pursue operational excellence. They do
this in a number of ways, including:
• Competing on core competencies,
while outsourcing non-core functions
to trusted third-party providers.
• Viewing information technology
(IT) as a strategic asset that creates
real value—not simply a cost to be
managed.
• Streamlining processes wherever
possible.
Accenture’s recommendations for Dabur
addressed all these drivers of high
performance, focusing on improvements
that would allow the company to work
smarter and generate the greatest and
longest-lasting value.
How Accenture helped
Accenture proposed that Dabur improve
its supply chain management, sales
and distribution capabilities and use
IT as a strategic enabler for its busi-
ness strategy. From an IT perspective,
Accenture recommended a two-pronged
strategy: migration to a nimbler
outsourcing model that would gener-
ate value through agility and support
business initiatives and maintenance
of its SAP enterprise resource planning
(ERP) system. To bring these initiatives
to life, Accenture assembled a team of
highly skilled industry experts, as well as
professionals with extensive SAP design
• Developing a new supply chain
and implementation experience. Working
closely with Dabur, the Accenture team
initiated a number of high-impact
projects, including:
• Implementing a new sales and
distribution strategy. Accenture
helped develop a comprehensive
retail strategy that marked Dabur’s
first significant effort to identify key
customer segments in urban and rural
markets, customize sales programs
for key accounts and reorganize
Dabur’s sales teams by one of four
trade channels (modern trade, rural,
“mom-and-pop” and drugstores).
Accenture supported this business
strategy with a cost-effective IT
solution, developed in-house over
several platforms, which captured
actionable information across the
national footprint of nearly 500
distributors. In the area of product
distribution, the team focused on
bolstering efficiencies and rural
market penetration and designed a
channel-specific strategy for grocers,
chemists, modern trade, wholesalers
and convenience stores.
In developing a more effective sales
program, Accenture paid special at-
tention to how Dabur might improve
service to Indian mega retailers,
which are expected to account for
more than 15 percent of consumer
product sales by 2010. For this group
of customers, the team established a
new operating model that included
a pricing architecture framework
to aid negotiations, an activation
strategy to guide tactical initiatives,
and revised roles and responsibilities
for all members of the trade field
force. In devising this strategy, the
Accenture and Dabur team optimized
the company’s internal logistics
and distribution processes for mega
retail customers, and put metrics and
incentives in place to drive specific
goals such as consistency of sales in
grocery stores, improved service to
drug stores and increased sales via
wholesale channels.
management capability. Accenture’s
research into the characteristics
of high-performance businesses
has shown that leading organiza-
tions reorient their supply chains
based on capability building for
revenue enhancing opportunities.
For Dabur, Accenture proposed
strengthening demand forecasting
capabilities, which would result in
greater operational efficiencies and
lower inventory costs. The team also
focused on bringing a market-driven
perspective to the new supply chain
and building collaboration skills,
which are vital for engaging partners
across functional areas throughout
the company and across the supply
chain. Accenture helped Dabur create
capabilities to facilitate the launch
of new initiatives, products and trade
promotions. This effort entailed
putting complex metrics into place
via the IT landscape. Accenture then
instituted a plan to leverage SAP by
automating Dabur’s material resource
planning processes across the
complex manufacturing arena. The
new approach allowed employees to
shift their focus from simple transac-
tions to more strategic procurement
efforts such as cost management.
• Optimizing Dabur’s ERP capabilities.
Accenture’s research indicates that
high-performance businesses invest
in state-of-the-art information
technology infrastructure, especially
ERP software, and are, more impor-
tantly, able to leverage it for strategic
cost management and collaboration
with customers and suppliers. While
Dabur had deployed a SAP ERP system
to link its corporate headquarters,
12 manufacturing plants and more
than 30 distribution centers, the
company was not using the system
to its maximum potential. Accenture
launched a three-phase ERP improve-
ment program that involved:
— Correcting the transactional and
management information systems.
— Conducting change management
and synchronizing Dabur’s business
processes with realities in an ERP
context.
— Developing value realization
projects.
Once the system was collecting
accurate and timely data, Accenture
identified key performance indicators
and created management dashboards
to improve and speed executive
decision making.
“Accenture’s role is like
any other department in
this organization. They
are like my extended IT
arm. That is, after all, the
spirit of outsourcing.”
—Anil Garg
• Leveraging IT for business initiatives.
In addition to revitalizing Dabur’s
ERP system, Accenture applied its
deep technical skills to create entirely
new IT capabilities. For example,
Accenture designed a Web-based
demand planning and trade promo-
tion forecasting tool, and installed
point-of-sale software at select
retail and wholesale sites. This latter
initiative allowed Dabur to integrate
key customers into its IT network and
gather real-time market information
that would drive better sales and
distribution decisions.
• Outsourcing IT operations. Dabur
realized the significant commitment
of resources and time that the
ongoing management of its IT opera-
tions, including its core ERP system
would entail. Given the success of
Accenture’s strategy and implementa-
tion efforts to date, coupled with
the strong reputation Accenture
has achieved in the application and
infrastructure outsourcing markets,
the company decided to outsource
its IT management to Accenture for
10 years—marking one of the first
IT outsourcing agreements to be
forged by an Indian company. In its
capacity as IT outsourcing provider,
Accenture delivered industrialized
and cost-effective skills that would
allow Dabur to remain at the leading
edge of IT delivery. Plus, Dabur gained
the flexibility of being able to focus
on its core capabilities while realizing
increased value and lower costs
through improved performance.
According to Anil Garg, assistant general
manager of IT at Dabur, “Accenture’s
role is like any other department in this
organization. They are like my extended
IT arm. That is, after all, the spirit of
outsourcing.” He goes further saying,
“Today, my CEO will not approve a
new IT project unless I can tell him the
impact it will have on the bottom line.
These questions were not asked of me
three years back; they were asked of
the functional heads. If I was on the IT
operations side, I would not have been
able to do all this.”
In addition to managing the client’s
information technologies, Accenture
continues to be involved in helping
Dabur achieve operational excellence in
a number of areas. The two companies
are collaborating to extend ERP
implementations in new geographies to
support international growth. They are
jointly examining strategic opportunities
such as mergers and acquisitions. And
they are working together to explore the
creation of even greater value through
the development of business cases and
diagnostic capability assessments.
High performance delivered
With Accenture’s help, Dabur has
implemented strategic and operational
changes that have led to a much higher
level of performance. Dabur is now one
of India’s fastest-growing companies.
Annual sales are up by 17 percent. Year-
over-year profits have increased by 40
percent. The company’s new sales force
structure has significantly enhanced
channel throughput and productivity.
Further, the new sales and distribution
strategy has enabled the company
to expand distribution by 19 percent
and add approximately 80,000 sales
outlets, bringing its total to 630,000.
This expansion has had a direct effect
on Dabur’s bottom line. Dabur estimates
that six percent of its 14 percent
revenue growth in 2007 is due to the
new retail strategy alone. Analyst HSBC
estimates that about 30 percent of the
revenue growth was due to increased
distribution reach.1
The successes to date have laid a
foundation for continued excellence. By
year-end, Dabur expects to install point-
of-sale software to support faster and
more accurate decisions on everything
from inventory levels to new product
roll-outs at 500 additional customers.
Accenture’s ongoing management of
Dabur’s IT operations has also generated
significant benefits. Most notably,
it is allowing Dabur to leverage IT
as a strategic asset and is ensuring
a constant availability of IT talent,
regardless of business demands. For
example, during Dabur’s acquisition of
Balsara (a manufacturer of cosmetics,
hygiene products and home products),
the outsourcing team provided the deep
skills necessary to carry out the phased
merger of the two companies’ core
enterprise systems. Equally important,
the outsourcing arrangement has freed
Dabur’s IT professionals to focus on
more strategic issues such as aligning
IT initiatives to business goals. The
Balsara acquisition provides evidence of
1HSBC Securities and Capital Markets (India), 15 June 2007.
2HSBC Securities and Capital Markets (India), 15 June 2007.
3Citigroup Investment Research, 23 July 2007.
this greater utilization of resources, as
well. Because Accenture was managing
the company’s IT operations, Dabur’s IT
leadership was available to be involved
in early discussions about the pending
acquisition. This leadership team was
also able to tap Accenture’s expertise
to determine the best way forward.
This early involvement and access to
Accenture’s expertise allowed Dabur to
carefully consider the IT ramifications
of the merger and develop a phased
implementation plan that corresponded
and supported the acquisition strategy.
With all of these efforts aimed at
achieving operational excellence,
Dabur is poised to realize its aggressive
revenue growth target. Analysts are
taking notice of Dabur’s ambitions, and
its new capabilities that will bring these
ambitions to life. HSBC has reported,
“We believe Dabur plays the focused
differentiator to perfection. It thrives
on identifying opportunities based on
consumer needs, tailoring products for
that audience and expanding with the
segment, while retaining its overall
leadership position.”2 And crediting
major distribution and sales force
improvements and new products,
Citigroup notes that Dabur is best
positioned among India’s consumer
goods companies to deliver consistent
sales and earnings growth.3 The
expectation is that Dabur will outpace
its peers. Dabur is not surprised by
such reports. After all, outpacing the
competition to enable high performance
is exactly what Dabur and Accenture set
out to do.
About Accenture Supply
Chain Management
The Accenture Supply Chain
Management service line works
with clients across a broad range of
industries to develop and execute
operational strategies that enable
profitable growth in new and existing
markets. Committed to helping clients
achieve high performance through
supply chain mastery, we combine
global industry expertise and skills in
supply chain strategy, sourcing and
procurement, supply chain planning,
manufacturing and design, fulfillment,
and service management to help
organizations transform their supply
chain capabilities. We collaborate
with clients to implement innovative
consulting and outsourcing solutions
that align operating models to support
business strategies, optimize global
operations, enable profitable product
launches, and enhance the skills
and capabilities of the supply chain
workforce. For more information, visit
www.accenture.com/supplychain.
About Accenture
Application Outsourcing
For over 15 years, Accenture has
worked with senior executives around
the world to address their most
critical business imperatives through
application outsourcing. Accenture's
application outsourcing approach
transforms application development and
maintenance to help clients achieve
high performance. Accenture offers
a full life-cycle service in application
software. We can design, build and run
an entire solution or provide point of
needs solutions in areas like testing,
software development, enterprise
software (e.g., SAP) support and much
more. Accenture has the people,
processes and global service network
to deliver the business results clients
need. For more information, visit www.
accenture.com/ao.
About Accenture
Infrastructure Outsourcing
Accenture is a leading global
infrastructure outsourcing service
provider. We have more than 10,000
people worldwide serving more than
160 clients daily. Drawing on unbiased
technology solutions, our infrastructure
outsourcing services offer executives
more control over their IT value chains,
performance and investment focus. We
offer a flexible set of services—from
totally transforming the client service
delivery model to simply addressing a
specific cost or performance issue with
fully integrated remote and on-site
delivery. To enable client’s businesses
to achieve high performance, they need
the right infrastructure at the right
cost to support critical applications
and business processes. For more
information, visit www.accenture.com/io.

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