SUPPLY CHAIN MANAGEMENT

1. SUPPLY CHAIN MANAGEMENT • Supply chain management is the management of all the activities related to sourcing, procurement, conversion and logistic management to deliver the right product or services to the customers at right time at acceptable cost • Organization in supply chain includes suppliers , intermediaries, transportation and logistics providers

2. Supply chain drivers • A number of forces or Drivers have played the a role in the evolution of the supply chain management strategies few of them are given below 1- Technology - two technological developments that have influenced the structure and operations are Information & communication technology

3. Competitive factors • The major competitive factors for supply chain relate to cost and availability factors • Organizations that focus on managing the inventories end up with reduced inventory related cost and improved stock out performance due to faster market access and improved process improvements

4. Business & Social Environment • Competition is severe. It has been recognised That instead of competition between organisation .competition is between supply chains now supply chains are more receptive to collaboration

5. Policy and regulation • Many policy and regulatory acts have a direct Effect on supply chain initiative e,g phasing out Of central tax replacing it with value added Tax Will have impact on distribution & retailing strategies of Companies including warehousing locations

6. Move from Producer centric to customer centric • Earliest supply chain were trading supply chain .It involved producing goods in one location and moving to another location where they were sold or exchanged • Customer centric area is an era of global competition. Tools & Techniques used in customer- centric are totally different from that are used in producer centric supply chain

7. Supply Chain Stages Supplier Manufacturer Distributor Distributor Retailer Customer

8. Value Chain in a Company Finance, Accounting , Information , Human Resource , Technology Service Distribution New product development Marketing & Sales Operation

9. Supply chain effectiveness • Supply chain effectiveness depends upon • Short Lead Time • Ability to handle large variety of products • Ability to meet high service level • Handle supply uncertainty • To respond to wide range of quantities demanded

10. continued • Responsiveness comes at a cost which can be understood by the below mentioned graph High Responsiveness low Cost High Low

11. Demand flow strategy collaborationstrategy Supply chain Strategy framework Customer service strategy Technologyintegration strategy

12. Competitive Strategy Supply chain strategy Marketing& sales strategy Product Development strategy

13. Competitive strategy Supply chain strategy Effieciency Responsiveness Facilities Inventory Transportation Information

14. Facilities • Facilities in supply chain stands for the locations to or from which the inventory is transported. Facilities and their corresponding capacities to perform their functions are key driver Centralization increases the efficiency. Locating the facilities near the customer may increase number of facilities hence responsiveness can be increased

15. Components of facilities Decision Following are the components of facilities Decision 1-Location 2-Capacity 3- Operation methodology • Product wise • Function wise

16. Logistical Infrastructure in India India has vast network of Roads ,Railway lines, Air cargo shipment system and vast coastal line Road— 1- National Highways-65569 KM 2-State Highways- 1,31,899 KM 3- District level roads- 467763KM 4-Village& other roads- 2650000 KM

17. Important highlights In India we are able to cover 300km on per day basis in west & Europe it is 600km/day Government has taken initiative to establish N .H.A .I Golden Quadrilateral has initiated and it is in advance stage- 5846 km NS-EW (North south &East west corridor is also on the anvil – 7300 km Existing Drawbacks- Slow speed Traffic &congestion

18. Rail Network – Biggest in Asia68% of revenue of railways comes from Freight,89% of freight is made of transporting Coal , Cement , Fertilizer , petroleum products , Food Grains ,Iron oreFinished steels and Raw Materials for steel plants

19. SEA PORT NETWORK India has a costal line 7517 KMS India has 12 major ports 95% of trade is by volume and 75% by value Government has taken initiative to allow 100% FDI Government has setup National Maritime Development Plan

20. Out Sourcing • Manufacturing Industries are normally faced with situation where they have to decide to make the parts in-house i,e by themself or it be given to some other manufacturer to make it. Such course of action is termed as Outsourcing. • Outsourcing decision is taken on two important Parameters 1) cost saving 2) capacity constraint In the context of supply chain Management ,in bound Logistic can be out sourced another party to carryout the related job

21. Third Party logistics • A manufacturing Firm may take a decision to purchase trucks for ensuring the dispatch of goods/final product to customer . How ever when business volume increases ,company may have to purchase more no of trucks. At one point of time company may decide to engage out side parties i,e logistic companies who have variety of trucks & tempos, Go down & Warehouse at their disposal

22. Logistics • This term was used in Military for deployment of armaments and troops. However it is widely used for movements of Raw material semi-finished and final products from manufacturer to warehouse or distributor and finally to customer. Logistic is broadly classified as Inbound logistic & outward logistic. Inbound implies that suppliers are arranging the dispatch of raw materials from their end to manufacturer

23. Logistics-cntd • In our country many traders & manufacturer patronized Railway goods train as well the parcel van of passenger trains to move their products after packing them in gunny bags & wooden boxes and crates. However parties/users have to go to railway’s goods shed/parcel room to get the cargo release and bring it their premises. It was cumbersome

24. continued • Transportation of products manufactured by industries was also managed by using Trucks and tempos depending upon Tonnage &, dimensions as well distance to be travelled. we see many trucks carrying goods and travelling more than 2000 KM also. we can also observe that construction of truck Bodies are also modified to suit the requirment

25. Logistic-continued • Some big business organization like T.C.I, ABC road lines, South Eastern road line have owned large no trucks or took trucks on hire basis from individuals. • Logistic companies have following facilities at their disposal 1 Fleet of Truck, Trailer and LCVs

26. continued 2- Godowns 3- Material handling equipments like pallet- lifters, fork lifts, Scissor lifts etc 4- Racks & Pallets for storage of goods 5- requisite manpower to perform following functions – a) Receiving /collection of goods and issue necessary receipt normally called GRN

27. continued • 2- after receiving the good it is to be stored in safe location having location number so that one can retrieve the consignment when ever it is to be dispatched . 3- Load planning and routing another important function is to asses the load whether load has become full load meaning thereby full truck load for that destination otherwise routing has to be worked out

28. Operational objectives • Logistic Management has following major objectives • 1- To deliver the consignment in committed time • 2- to deliver the consignment in safe condition i,e without any damage • 3- total cost of delivering the product should be to the satisfaction of customer

29. Continued • There should not be any shortage or pilferage in the consignment • Communication with respect to delivery date and time to be sent to consignee for his/her availability to receive the consignment