Kenya Tea Development Agency rolls out SAP technology to improve efficiency

KENYA – The Kenya Tea Development Agency (KTDA) has rolled out an SAP technology across all its factories in a bid to improve the efficiency and technological dynamism of the tea industry.

According to the agency, implementation of SAP has provided analytical tools for better decision-making while facilitating efficient and rapid payment for farmers’ green leaves.

Additionally, it has greatly increased end-to-end visibility and payment processing for better controls and security measures.

KTDA CEO Wilson Muthaura highlighted that they desired a solution that would improve every aspect of their operations, from production planning and quality management to sales, distribution, and payroll.

“This was no mean feat since there are more than 600,000 farmers paid every month for green leaf supplied, as well as over 10,000 employees working across the organization.

“However, following this successful rollout, all farmers are now paid through our SAP system, reducing processing time by more than 80 percent,” he said.

A fully owned farmer firm, KTDA Holdings Ltd., has invested in a number of subsidiary businesses along Kenya’s tea value chain.

The 71 factories’ operations are efficiently managed by the KTDA Management Services organization, and SAP has been helpful in boosting operational efficiencies with a view to boosting transparency and profitability in the enterprises.

Seven of the Agency’s subsidiaries and a Foundation offer specialized services along the entire tea value chain, including factory management, engineering, insurance, tea trade and warehousing, credit provision, and power generation.

The system also allows the Agency to easily incorporate other items like loans and inputs like fertilizer issued to the payment process allowing for easy and seamless recoveries.

“We worked with an experienced SAP partner, OneConnect Technologies, to implement SAP ERP Central Component and Business Intelligence, covering end-to-end processes across KTDA’s operations,” said Martin Mwarangu, Group General Manager for ICT Services at KTDA.

Besides payment processing, different modules of SAP have delivered multiple benefits including production planning and management and full visibility of tea sales.

“SAP has digitally transformed the KTDA business and made it technologically ready to adopt any future solutions that would further enhance business efficiencies.

“The wealth of data generated is important in decision making and forecasting,” says Julius Onguso, Managing Director, KTDA Management Services

KTDA has also launched a sales and distribution module that enables all tea selling operations, including sales order generation, tea dispatch, and revenue management, to be carried out on a single system.

The SAP solution creates a ton of data and includes business analytical tools that produce reports and dashboards that are frequently utilized by decision-makers to gain understanding and make better business decisions.

The SAP system is currently being used by 32 KTDA-managed factories, simplifying reporting and intercompany integration.

Its implementation also results in consistency and uniformity in the management of each factory.

“Facing inefficiency and a lack of visibility over critical business processes, KTDA embraced the benefits of the latest technology to completely transform their end-to-end business functions.

“As KTDA continues to play a vital role in the broader Kenyan economy as well as directly in the lives of smallholder farmers, having real-time visibility over the entire organization’s processes will bring vast improvements to its operations benefitting all stakeholders,” said Hardeep Sound, Regional Sales Director for East Africa at SAP, a German multinational software company.

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