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Glaxo Smith Kline India Ltd

Glaxo Smith Kline India Ltd

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Published by: nikhil mehrotra123 on Jan 18, 2010
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Glaxo Smith Kline India Ltd.
Glaxo Smith Kline India Ltd. is one of the most important and growing parts of thepharmaceutical manufacturing giant Glaxo Smith Kline, UK (known as GSK,worldwide).Glaxo Smith Kline India Ltd. manufactures medicines and vaccines for Indiandomesticmarket. It has more than 20% of the market share of pharmaceutical products inIndia. GlaxoSmith Kline India Ltd. has its own 4 manufacturing units and rest of itsmanufacturing is outsourced to 23 partner pharmaceutical manufacturing companies throughoutIndia. It has 5warehouses strategically located to cater to distributors (CFAs) who are locatedin widelyscattered geography of India. The total number of distributors (CFAs) is 31.Almost all of the sales of GSK India is done indirectly through these CFAs.Primarily there are 2 groups of products:Product1: Medicine

Fast moving Medicine

Slow moving MedicineProduct2: VaccinesIn all Glaxo Smith Kline India Ltd. produces more than 550 differentpharmaceutical products. Transportation part of the whole distribution system is outsourced to manyindependent privategoods carriers. These carriers are grouped as trucking (with varying carryingcapacities of 32 Ton, 17 Ton, 9 Ton, 3.5 Ton); railroad, surface couriers and air couriers. Thelead-time variesfrom 15 days for a railroad connection from the western part of India to the fareastern part of India to 5 – 7 days for most road connections for trucks to 2 days for air courier.Glaxo Smith Kline India Ltd. had implemented ERP system from vendor JDEdwards.While this system has been proving very useful for there manufacturingprocesses, they did nothad a satisfactory solution for their product transportation and distributionprocesses.
Glaxo Smith Kline India Ltd.
1. Planning used to take at least 2 weeks and required input from many people.A lot of effort was required to make these plans.2. By the time the plan was made, it became obsolete as initial requirementsgot changed.When any change in plan was required, it was impossible to incorporate thesechanges
 
in the plan.3. The whole product distribution system was inefficient.4. Service levels were very low.5. Stock outs were occurring.6. There were many under fill movements of trucks.7. No visibility across the whole distribution system.8. Very difficult to Control distribution system.9. Late orders were creating a lot of problems.10. Solution should be able to consolidate orders, regional forecasts, andadditional orders.1. When Optimization Engine is implemented in an organization where there isalready animplementation of any ERP system, Optimization Engine works as the brainsbehind thebusiness operations whereas the ERP system works as the business enabler.
2.
Our Optimization Engine software takes care of all sales orders and sale sforecasts. Itconsolidates all sales demand forecasts made by different sales units as well asthepurchase orders; the company receives. Based on this consolidated figure, thecompanycan do any supply chain related planning.3. Our Optimization Engine Software is based on Genetic Algorithm basedcomputation. The plan it generates is the most optimal solution for the given scenario and noothersolution can easily beat it.4. Optimization Engine software takes into account stock out cost (loss of orderdue tounavailability of stock), inventory cost and transportation cost, raw materialcosts,human resources costs, inventory costs, machine change over costs and itgenerates aplan to minimize all of these costs. User has a choice to assign weight age andthesoftware generates the most optimal plan accordingly.5. Optimization Engine software takes into account lead time and otherconstraints. Ittakes them into account completely when it generates the most optimal plan.
6.
Optimization Engine takes into account service levels for items, businessunits, clientsand orders. User has a choice to give weight age to these services levelsindividually andthe software generates the most optimal plan accordingly.7. Our experience shows that even at places like big and reputed multinationalcompanies;the efficiency of their business processes is not optimal even after goodimplementation
 
of ERP systems. In most cases our software can improve their businessprocesses by atleast 10% and it can go even to 300%. This translates to corresponding costsavings forthe company.

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