IT IN CORE INDUSTRIES

The GoP must make computer financing mandatory for financial institutions and tell them to allocate larger amount under this head

By SHABBIR H. KAZMI
June 30 - July 06, 2003

Using computer for managing information system in the office is not the only use of Information Technology (IT). Many of the services people use daily are entered, retrieved, processed and stored at servers located at remote locations. Microprocessor, brain of a computer, is also used in many process industries to achieve higher level of automation, not to make people redundant but to optimize cost and improve the quality of life.

Thanks to the developments in communication technology, Internet has become part of daily life. People remain in contact with their near and dears on a touch of a few keys and do not have to wait for days to get the replies to their letters. The uses of ATMs and phone banking have made banking 24-hours a day possible, even on holidays. Convergence combining computing with communication has brought revolution in the way people work. Yet another addition is mobile communication, using laptops and mobile telephony.

The GoP policies have made computer affordable, increased computer population and Internet penetration. Computer population is growing in double digits in the country. Availability of "building blocs" technology allows the computer users to improve capabilities of computers with the growth of their business. As the world is fast adopting e-commerce, as norm, data warehousing needs are growing. However, to develop efficient database the business entities are still not using computers in the best possible manner. First they have to computerize their record keeping and then only they can interact with all other stakeholders.

Many people are still reluctant to use computers fearing that their data would not be secure. However, the experts say that very often the data is available but not accessible when most needed. Business managers often make imprudent decisions due to limited availability of information that often add to losses. If the crucial data is kept and accessible productivity will increased and result in higher profit margins.

With the advent of process of globalization, competition is getting fiercer. Manufacturers often cannot charge the price they desire because market forces determine the prices. Therefore, the available option is to optimize costs and not to follow the cost cutting approach. Costs can only be optimized when production and productivity are improved and wastage is reduced.

Most of the economies thrive mainly because of comparative advantage they enjoy. Pakistan's textile industry has grown because of availability of cotton at lower prices, quota regime and protection. However, none of these advantages will be available after December 31, 2004 due to integration of textile trade under the World Trade Organization (WTO) regime. Therefore, it is imperative for the textile industry to make the best use of IT for maintaining competitiveness in the global markets.

With the advent of Internet buying habits of international buyers have changed drastically. While exporters from other countries are promoting their goods and services through websites, Pakistani manufacturers are not making use of this tool. Websites of large number of local companies hardly give details about their capabilities, performance and strengths. It is almost impossible to undertake e-commerce through these websites.  

There are two generic options available, i.e. SAP and ERP. Each has its own advantages and limitations. Yet another option is go for tailor-made software. The key advantage of SAP and ERP are that they have been tried and tested globally. These applications can be altered to suit the user's needs.

Some entrepreneurs believe that creating a paperless organization or e-organization is almost impossible in Pakistan. Experts say that it is not impossible but certainly not easy. To get hands on the clients should first of all stop considering IT a function of finance department. It needs immediate attention of CEOs. The CEOs or key decision-makers in any organization need certain information for crucial decision making. First of all such critical data must be made available and easily accessible. Therefore, the solution may be to deploy the technology first in the areas that are more sensitive.

A common complaint in Pakistan is that computer hardware and software are still not affordable. The large influx of second-hand computers has made computers affordable. However, buying the computers, based on latest innovations, is still not affordable. It is a little disappointing that financial institutions are underwriting leases of hundreds of cars every month, but hardly consider computer worth financing under their consumer financing schemes.

While it may not be fair to stop inflow of branded computers into Pakistan, the GoP must discourage import of completely build units (CBUs). Multinational hardware marketing companies should be allowed to import only CKD units into the country and assemble them in Pakistan. This will create new job opportunities in the country and also facilitate transfer of technology.