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A REPORT ON BUSINESS PROCESS REENGINEERING FOR IMPLEMENTING WAREHOUSE MANAGEMENT SYSTEM
Manoj Banshilal Pachouri 05BS 1741 ICFAI Business School Bangalore
A REPORT ON BUSINESS PROCESS REENGINEERING FOR IMPLEMENTING WAREHOUSE MANAGEMENT SYSTEM By
Manoj Banshilal Pachouri ICFAI Business School Bangalore
A report submitted in partial fulfillment of the requirements of MBA program of ICFAI Business School Submitted To Faculty guide Prof. Bharat Kantharia ICFAI Business School Ahmedabad Company Guide Mr. Sharad Jobanputra Fairdeal Distribution Services Pvt. Ltd. Ahmedabad
Fairdeal Distribution Services Pvt. Ltd.
311, Shiromani, Surendra Mangaldas Road, Ahmedabad – 380 015 India Phone: 00 91 79 55215456 (3 Lines) Fax: 00 91 79 26753551 Email: email@example.com Website: www.fairdeal.org May 15, 2006 CERTIFICATE TO WHOMSOEVER IT MAY CONCERN
This is to certify that Mr. Manoj Banshilal Pachouri has successfully completed the Project work, assigned to him at Fairdeal Distribution Services Pvt. Ltd., as part of the requirement in the MBA Curriculum of ICFAI Business School under my guidance and supervision. He has worked on the project titled Business Process Reengineering for Implementing Warehouse Management System during the period February 2006 – May 2006. This project is done for partial fulfillment of the M.B.A. program from the aforesaid institute. I wish him all the best in his future endeavors and career. Yours truly, FAIRDEAL DISTRIBUTION SERVICES PVT. LTD.,
Sharad Jobanputra Managing Director
Manoj Banshilal Pachouri
ICFAI Business School
I declare that the project entitled “BUSINESS PROCESS REENGINEERING FOR IMPLEMENTING WAREHOUSE MANAGEMENT SYSTEM” conducted at Fairdeal Distribution Services Pvt. Limited is a record of independent research work carried out by me during the academic year 2005-06 under the able guidance of my faculty guide Professor Bharat Kantharia of ICFAI Business School, Ahmedabad, and my project guide Mr. Sharad Jobanputra, promoter and Managing Director of Fairdeal Distribution Services Pvt. Ltd. (www.fairdeal.org) I also declare that this project is the result of my effort and has not been submitted to any other University or Institution for the award of any degree, or personal favor whatsoever. All the details and analysis provided in the report hold true to the best of my knowledge.
Place: Ahmedabad Date: 10th May 2006
Manoj Banshilal Pachouri ICFAI Business School
Manoj Banshilal Pachouri
ICFAI Business School
I acknowledge all those whose guidance and encouragement served as a “beacon light” and crowned my efforts with success. I sincerely thank Mr. with immense gratitude. I thank him for being a constant source of inspiration. zeal. Rajkumar of Sequel Pvt. and my company guide for giving me an opportunity to take up this project. His 30 years of experience in Sales and Distribution was itself a great source of knowledge and information for me. After all. severance. he bestowed every possible facility to me. honorable Promoter and Managing Director of Fairdeal Distributors Pvt. Sharad Jobanputra.Acknowledgements The satiation and euphoric that accompany the successful completion of task. Manoj Banshilal Pachouri iii ICFAI Business School . undeferred missionary. So. steadfast determination and most of all encouraging guidance. for giving me value suggestions and advice throughout the execution of the project. I would like to extend my warm salutations to Professor Ravi Warrior. and my project guide for guiding me as well as providing me the support to conduct this project. I sincerely and whole-heartedly thank my fellow colleagues and the staff team at Fairdeal Distribution Services Pvt. would be incomplete without the mention of the people who made it possible. my Marketing faculty at Bangalore campus and Mr. Despite his demanding schedule. so as to carry on the project work without any encumbrance. Ltd. for his guidance and encouragement in getting this project. success is the epitome of hard work. With a deep sense of gratitude and indebtedness. Ltd.ICFAI Business School. I would like to express my profound sense of gratitude to Professor Bharat Kantharia . mentor and above all for his encouragement. Ahmedabad. Ltd. This IIM-A graduate with his more than 20 years of work experience in ERP implementation and Business Process Reengineering has all the tools required to guide a student. This project would not have been concluded successfully within time without their support and help.
I take this opportunity to thank all the library members of ICFAI Business School. Dhanvanti Devi. and my seniors who provided me with the study material on my project. I thank my parents. Mr. Mr. for bringing me up in a successful environment and teaching me all the basic etiquettes and ethics required for my growth in an organization. Mr. Last but not the least. friends. Sunil Patel of Bharati (Motoroala). Ltd.I would be selfish if I do not mention names of Mr. Aashish of Titan watches. Pravin of Amara Raja Batteries. and many other who gave me their valuable time from their busy schedule to help me in studying the business processes at Fairdeal Distribution Services Pvt. Late Shri Banshilal Pachouri and Ms. Mr. Hemant & Mr. Narendra of TVS Motors. Saurabh of Voltas. Ahmedabad. Mr. Manoj Banshilal Pachouri 05BS 1741 ICFAI Business School Manoj Banshilal Pachouri iv ICFAI Business School . Mr. Zankar. Vinod of Tata Tea.
McFills foods. Fairdeal’s staff was also equally capable with industry experience in range of two to ten years. Though the time was clearly sketched out to me. Manoj Banshilal Pachouri v ICFAI Business School . TVS Motors. Telecommunications industry and Paint Industry. MRF paints. dealers.Me @ FAIRDEAL I am among the few professionals who are privileged to get their dream project. BPL Sanyo. Fairdeal’s management and staff was not less than a gurukul for me. Working with the Fairdeal I have been able to understand some of the best logistics and clearing & forwarding industry practices that they follow. Pawas Agarwal. Around four month of my work exposure gave me tremendous insights into the companies operations. branch managers (BM) and other top management of these companies stretched my thinking nerves and gave me new perspective of looking at corporate world’s real time situations. MICO Bosch. At the Fairdeal. Some of the companies I studied in these industries are Titan. Tata tea. Tanishq. Horology industry. Tata tea regional manager for west zone during my project. Foods and snacks industry. Electronic home appliances industry. In a very systematic manner training was offered to me. Motorola. Bharati Teletech. It was always my dream to work on an ERP and BPR project in my SIP and Fairdeal provided me this opportunity. My Interaction with Area Sales Managers (ASM). Planning Scheduling and deadlines are a part of every working individual and that’s exactly what was expected of me. Apart from external industry exposure. I also got opportunity to spend some time with Mr. Sharad Jobanputra’s guidance with more than years of industry experience and his deep knowledge of various fields was more than any business school lecture. I was given complete freedom with the style of working. Automobile industry. I got the opportunity to understand the supply chain and logistics operations of many industries namely. Amara Raja Batteries etc. Bell ceramics. Voltas. Mr.
Ltd. These reports covered my basic understanding of the issue and then methodology that used for the analysis. The prospectus of association with Fairdeal Distribution Services Pvt. Manoj Banshilal Pachouri vi ICFAI Business School . In short. This will steer me to make myself competent enough and excel in whatever I do. it was a knowledge enhancing and curiosity quenching experience that will linger in my heart. This enhanced my knowledge to great extent and triggered in me the curiosity to know more on the subject. is always near to my heart.During entire internship period I was asked to report at the end of every phase that I complete.
................................................ v Table of Contents......................................................................................................................................................................................................... xi Acronyms and Abbreviations... x List of Tables................................................ 25 Vendor Owned Inventory Management ....................................................... 34 Locations.......................... 6 Scope of the project ........................................................................................................................................................................................................... 34 Product Range.......................................................................................................................................................... 7 Limitations of the Study......Table of Contents CERTIFICATE ................................................. 27 Clearing and Forwarding Agents ............................... 8 Proposed Methodology............................................................... 31 History .................................................................... 15 INDUSTRY ANALYSIS ..................................................... 32 Independent Directors .................................. 35 Distribution Network .............................................................................. 9 Detailed tasks to be performed ....... vii List of Figures....................................................................... Mission and Business Objectives ......................... 36 Awards and Achievements ......................... 24 In-plant Stores Outsourcing .................................................................... iii Me @ FAIRDEAL............................ 11 Project Schedule......................................................................................................................................... 33 Business Focus ........................................................................................................... 1 Executive Summary ......................................................................................................................................................... 16 Logistics Industry ................................... 23 Fourth Party Logistics (4PL) Industry............................. 37 Manoj Banshilal Pachouri vii ICFAI Business School .......................................................................... 3 INTRODUCTION ...... i DECLARATION .............................................. 26 Material Handling ........................................................................ 29 ABOUT FAIRDEAL . 25 Warehousing............... 16 Legal Issues in Logistics Industry......................... 26 Reverse Logistics (Returns Management) ........ 6 Objectives of the Project ................................................. 19 Third Party Logistics Industry: SWOT Analysis ...................... 30 Vision.......................................................................... ii Acknowledgements ....... 32 Directors ..................................................... xii Abstract..... 18 Third party logistics .......................................................................................................................................................
.......... 138 Other Notes from Interviews ...................................................................................... 37 Voltas . 81 Definition of ABC Analysis .............................................................. 121 Dispatching Process ........................ 134 Initial Issues Emerged Out Of AS-IS Analysis......................................... 49 MRF Ltd ...................................................... 82 Value Wise ABC Analysis.............................................................................................................................. 41 Amara Raja Batteries Limited (ARBL) ..................... 99 Cycle Time.................................................................................................................. 53 Processes and the Organization ....................................................................................................................................................................... 48 Bharti Teletech...................................................................................................... 140 TO-BE ANALYSIS ......... 83 Quantity Wise ABC Analysis........................................ 126 Handling Unsalable Material Process ............ Wait Time measurements ...... 108 Cycle Count Process ................................................ 46 Bell ceramics ......................................................... 56 Company Wise Processes .................................................................................Client Companies..... 51 PROCESS ANALYSIS ....................................... 129 Handling Warranty Claims Process ........................................... 91 AS-IS ANALYSIS ... 39 Tata Tea ........ 143 Assembling Warehouse Data ............................................... 54 Sources of Data Collection ............... 112 Order Punching Process .................................. 100 Process Matrices [Key Performance Indicators (KPIs)].... 96 Decide on an approach ........................... 141 Preparation for Implementing Re-Designed Processes .................. 87 Transactions Wise ABC Analysis ...................................................... 95 Definition of AS-IS Analysis............................................................................................................................................................................ 37 Titan Industries ................................................................................................................................................................. 55 Remuneration claimed by CFA ................................. 44 Motors Industry Company Limited (MICO)................................................................. 104 Storing Material Process ............................................... 57 ABC ANALYSIS .......... 144 Manoj Banshilal Pachouri viii ICFAI Business School ................................................................................................. 115 Order Approval Process .................. 143 Warehouse Layout ....................................................................... 103 Goods Receiving Process................................................................................... 54 Organization Structure of Fairdeal............................................................ 132 Stock Maintenance Process ................................. 43 TVS Motors.................... 123 Transportation Process ............... 118 Invoice/ Bill Printing/ Stock Transfer Process ..................................................
....Specifying the Replenishment Sequence ............................................... Synchronize Fairdeal WMS and Principal’s ERP Module ... Generating Barcode Labels.................... REFERENCES ............................. APPENDIX C: Flowcharting Shapes .................................. To-Be Warranty Claims & Unsalable Material Process ........................................................................................................................................................................... To-Be Transportation Process . To-Be Storing Material Process .................................. To-Be Goods Receiving Process............... GLOSSARY ..................................... To-Be Invoice/ Bill Printing/ Stock Transfer Process ........................................... To-Be Dispatching Process ... To-Be Order Punching Process ......... APPENDIX B: Fairdeal’s Document Formats ........................ TO-BE Stock Maintenance Process.......... To-Be Order Approval Process ........................................ Internet Sources................................................... Import-Export Data To and From WMS .... Project Activity-Time Schedule... Suggestions and Recommendations...................... To-Be Cycle Count Process ................................. APPENDIX A: Key staff involved in the project .................................................................................................................................................. Bibliography....................................................... Implementing Location Sequencing ................................................................................................................................................................................................................................... Characteristics of an Ideal WMS............................. 146 146 147 147 148 149 152 154 156 157 159 161 163 165 166 169 170 174 182 185 185 186 193 194 194 195 196 Manoj Banshilal Pachouri ix ICFAI Business School ...................................... APPENDICES ...................................... SUGGESTIONS AND RECOMMENDATINS.......................
................ 158 20: Flowchart of TO-BE Invoice/ Stock Transfer Process........ 192 31: Flowcharting Shapes ........................ 137 15: Warehouse Layout ............. 155 19: Flowchart of TO-BE Order Approval Process .. 133 14: Flowchart of Stock Maintenance Process..... 193 Manoj Banshilal Pachouri x ICFAI Business School ............................................. 160 21: Flowchart of TO-BE Dispatching Process ....................................................................... 9 2: Reverse Logistics Cycle ............... 128 12: Flowchart of Handling Unsalable Material Process ......................... 114 7: Flowchart of Order Punching Process ....................... 186 25: Format of Invoice ........................ 153 18: Flowchart of TO-BE Cycle Count Process .................................................. 120 9: Flowchart of Invoice/ Bill Printing/ Stock Transfer Process 122 10: Flowchart of Dispatching Process .... 131 13: Flowchart of Handling Warranty Claims Process........................................................... 164 23: Flowchart of TO-BE Stock Maintenance Process ............. 107 5: Flowchart of Storing Material Process ........... 187 26: Format of Advance Intimation of Warranty Return ............................... 144 16: Flowchart of TO-BE Goods Receiving Process ........................ 162 22: Flowchart of TO-BE Transportation Process......................................... 190 29: Format of Warranty Replacement Delivery Challan .......................... 168 24: Format of Gate Pass of Fairdeal ..... 188 27: Format of Lorry Receipt (LR) of Fairdeal ...................... 55 4: Flowchart of Goods Receiving Process....................List of Figures Figure Figure Figure Figure Figure Figure Figure Figure Figure Figure Figure Figure Figure Figure Figure Figure Figure Figure Figure Figure Figure Figure Figure Figure Figure Figure Figure Figure Figure Figure Figure 1: The Implementation Process Model Project Plan ........... 191 30: Format of Warranty Return Delivery Challan . 151 17: Flowchart of TO-BE Storing Material Process ............................... 28 3: Organization Structure of Fairdeal................. 189 28: Format of Lorry Receipt obtained by Fairdeal ..................................... 117 8: Flowchart of Order Approval Process ................................. 125 11: Flowchart of Transportation Process ............... 111 6: Flowchart of Cycle Count Process .
................... 102 12: Summary of Metrics ............ 103 13: Goods Receiving Process ......................................................... 121 19: Dispatching Process ................................................................................... 130 22: Handling Warranty Claims Process.................................................................. 167 34: Project Activity-Time Schedule........................... 184 37: Key Staff Involved In the Project......................................................................................................Quantity Wise .............. 154 29: TO-BE Order Approval Process ..................... 113 16: Order Punching Process ........................................ 101 10: Ideal Unloading times (with four labors).............................................................. 86 6: ABC Analysis .. 110 15: Cycle Count Process ....Value Wise .................. 100 9: Loading & Unloading times in TVS (With four labors) ...... 136 24: AS-IS Analysis -Important issues with priorities ......................................... 138 25: Example of Location Sequence Numbers . 15 2: SWOT Analysis of 3PL Industry ................... 90 7: ABC Analysis ........................... 34 4: Some examples of Titan watches ......................................................................... 23 3: Product Range of Fairdeal ...................... 152 28: TO-BE Cycle Count Process ............ 146 26: TO-BE Goods Receiving Process ..................................... 161 32: TO-BE Transportation Process............ 119 18: Invoice/ Bill Printing/ Stock Transfer Process ............... 182 35: Gantt chart of Project Activity-time Schedule . 116 17: Order Approval Process.................... 101 11: Fairdeal’s Unloading times.........................................................................List of Tables Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table Table 1: Project Schedule..... 157 30: TO-BE Invoice/ Bill Printing/ Stock Transfer Process........................................................................................... 127 21: Handling Unsalable Material Process ............ 59 5: ABC Analysis .......................................Transaction Wise .................................. 94 8: Unloading times of Transport Vehicles .......................... 183 36: Organizational responsibility .............................. 150 27: TO-BE Storing Material Process .......... 106 14: Storing Material Process.. 132 23: Stock Maintenance Process........................ 124 20: Transportation Process ......................................................................... 163 33: TO-BE Stock Maintenance Process .... 159 31: TO-BE Dispatching Process ........................................... 185 Manoj Banshilal Pachouri xi ICFAI Business School ......................................
Forecasting & Replenishment : Cycle Time Management : Rolling Sales Plan : Vendor Operated Inventory : Stock Keepting Unit SD module : Sales and Distribution Module Manoj Banshilal Pachouri xii ICFAI Business School .Acronyms and Abbreviations BPR ERP WMS WIP GRN STM ASN LR FMCG DD E-ARIMS VAT AGVS AIDC APS ASRS CPFR CTM RSP VOI SKU : Business Process Engineering : Enterprise Resource Planning : Warehouse Management System : Work In Progress : Goods Received Note : Stock Transfer Memo : Advance Shipment Notice : Lorry Receipt : Fast Moving Consumer Goods : Demand Draft of a Bank : electronic – Amara Raja Inventory Management System : Value Added Tax : Automated Guided Vehicle System : Automatic Identification Data Capture : Advanced Planning and Scheduling : Automated Storage & Retrieval System : Collaborative Planning.
At the same time. total eighteen processes and sub-processes were short-listed for detailed study. Transportation. For example: It was found that serial numbers were being scanned at the time of dispatching the material which was delaying both dispatching time as well as order cycle time. Project took off with studying all the processes being carried out at Fairdeal warehouse. out of which. by implementing an Enterprise Resource Planning (ERP) Warehouse Management System (WMS) Module. Dispatching.Abstract More and more organizations worldwide want to develop products for global markets. This is also known as Clearing & Forwarding. Manoj Banshilal Pachouri 1 ICFAI Business School . In the next phase. they need to source material globally to be competitive. Order punching. Cycle Count. Handling unsalable material and Handling warranty claims. ten processes were selected for AS-IS Analysis phase which included Goods receiving. Invoice [refer to format of Invoice in APPENDIX B] printing. These processes were benchmarked with best practices of warehousing and clearing & forwarding industry. TO-BE Analysis was taken up for eight processes which required re-engineering. Result of AS-IS Analysis revealed activities in certain processes were not at par with industry standards and needed improvement. Organizations have developed strategic alliances with 3PL companies all over the world to manage their logistics operations network. After thorough discussions with Fairdeal’s management and on the basis of need analysis. Storing. Order Approval. Ltd. Some activities were acting as bottlenecks and needed restructuring. This project titled “Business Process Reengineering for Implementing Warehouse Management System” aims at improving efficiency of business processes being used at Fairdeal Distribution Services Pvt. These alliances are also known as logistics or supply chain outsourcing and contract logistics. One of today's trends to solve this problem is outsourcing logistics or using third-party logistics (3PL) to manage complex distribution requirements.
This would reduce errors in times of absentees and attritions. location codes and quantity. A detailed process restructuring plan was made and recommendations were given to Fairdeal’s management. Efficiency of processes will increase. I studied during this project are Intelliwms from IntelliTrack etc. • • • It is estimated that these recommendations after being implemented will enhance operations of Fairdeal to a great extent. This pick slip will include item codes. Each employee should have knowledge of at least two softwares. Manoj Banshilal Pachouri 2 ICFAI Business School . Fairdeal’s staff should develop cross-functional and cross-company knowledge of different softwares and packages.Demonstrations of third party warehouse management systems (WMS) were attended to get best industry warehousing practices and interviews were organized to observe the expectations of the end user. Based on industry’s best practices and findings of AS-IS Analysis. Pick slip will be generated at the time of invoice printing which would be helpful in locating material in the warehouse. Pre-plan the arrival of Goods-In-Transit and keep the space ready for arriving material. cycle time of orders will decrease and space utilization will also increase. dependency on specific employee will decrease. Some of the suggestions implemented by Fairdeal are as follows: • Scan barcode numbers at the time of storing the material and not at the time of dispatching. Some of WMS softwares.
org) from February 13th 2006 to May 20th 2006.Executive Summary Hello.fairdeal. Findings and recommendations of this project were very useful during implementation of Warehouse Management System. Profile/ Key Result Area • • • • • • Understanding processes in logistics industry AS-IS Analysis to find out current processes being carried out Interacting with process users to understand their needs TO-BE Analysis to benchmark best processes in logistics industry Pointing out issues and suggesting recommendations Documenting every activity during project Reporting: I reported to Mr. Sharad Jobanputra and faculty guide Mr. Sharad Jobanputra who is founding promoter and managing director of Fairdeal Distribution Services Pvt. Team Constitution: This project was solely undertaken by me under guidance of company guide Mr. This project was so closely related to these two subjects that I had to implement most of my learning in Supply Chain Management. How did I apply my learning at IBS? During this project. Bharat Kantharia as well as top management of the company. I was assigned the task of doing Business Process Re-engineering which helped the company improve efficiency of its business processes. I did my S. Manoj Banshilal Pachouri 3 ICFAI Business School . my learning in classroom. A copy of report was submitted to faculty guide Mr. (www. Enterprise Resource Planning etc.P. with Fairdeal Distribution Services Pvt.I. All the employees and some customers of Fairdeal were indirectly (but very closely) involved. Ltd. I am Manoj Banshilal Pachouri*. especially classes of ITM and Operations Management. Bharat Kantharia. Ltd. proved to be very useful. Cycle times.
0 for writing data on Compact Disk (CD) Adobe Photoshop 6.0 Professional for converting word document into PDF format Adobe Acrobat 5. This project also developed my professional personality by teaching me team building. time management and corporate ethics.0 for editing images Adobe Acrobat 7.0 for archiving files Manoj Banshilal Pachouri 4 ICFAI Business School . Though I had work experience of five years in field of software developing and marketing but this project exposed me to a new field of supply chain management and third party logistics to implement Information Technology in clearing and forwarding and warehouse management industry. business communication skills. negotiation skills.0 for reading PDF documents HP Scanner for scanning documents Microsoft XP Paint for converting bitmap format to picture format Microsoft Notepad for writing notes Microsoft XP Word for documentation Microsoft XP Excel sheets for calculation and charts Microsoft XP Power point for making presentations Internet Explorer 6. I leant Microsoft Visio 2003 to draw flowcharts during AS-IS Analysis phase of this project.0 for surfing internet WinZip 9. group dynamics.This resemblance between SIP project and my learning at IBS helped me completing this project without much hurdles and with in given time limit. Some of the Software packages and tools I used during the course of this project are: • • • • • • • • • • • • • Microsoft Visio 2003 for drawing flowcharts Adobe Nero Express 6. Learning during SIP: This project proved to be my dream project as I learnt a lot of ERP and BPR fundamentals and concepts during this project.
I owe my deep respects and regards to Mr. Sharad Jobanputra (Company Guide) and Mr. Bharat Kantharia (Faculty Guide) who provided me wonderful ambience to learn through out this project. Preparation/ Achievements/ Recognition: I began preparing for the project even before writing my semester II exams (31st Jan 2006 – 04th Feb 2006), that helped a lot. I used to surf supply chain management and logistics websites to understand third party logistics, Clearing & Forwarding and Warehousing industry. I used to discuss intricacies of business processes and BPR with my faculties of Information Technology for Managers and Operations Management. My report was highly appreciated by Fairdeal’s management as well as my Company Guide Mr. Bharat Kantharia. Findings of this project will be used as an important document for developing Warehouse Management System (WMS) for Fairdeal Distribution Services Pvt. Ltd. and documentation of this project would be used to train and equip employees of Fairdeal with best industry practices.
* Manoj Banshilal Pachouri, age 25 years, is a student of class of 2007 at IBS Bangalore. Prior to his MBA he was working as a software developer in Ahmedabad at .NET platform (C#.NET, VB.NET). He wants to be known as an ERP and BPR consultant and is deeply inspired by Mr. Jayant Chawala of SAP Labs who is a famous name in ERP implementation world.
Manoj Banshilal Pachouri
ICFAI Business School
Objectives of the Project
Process Mapping • To find common processes across principal companies. • To find specific processes related to each company. For Example: Orders punched on internet; dispatch strictly on FIFO basis etc. Process Improvement • To compare current processes of Fairdeal Distribution Services Pvt. Ltd. with benchmarked processes. For Example: Automating FIFO (First-In-First-Out); Handling multiple MRP during price revision, Inspection stock etc. To suggest refinement or changes in the processes.
Process Standardization • To standardize processes of Fairdeal Distribution Services Pvt. Ltd. by studying their activities. • To prepare process flow charts and process performing ‘AS-IS’ Analysis and ‘TO-BE’ Analysis. matrices after
Implement Warehouse Management System (WMS) Prepare a blueprint on how to incorporate the various processes into software, which then forms the base document for developing the WMS for Fairdeal Distribution Services Pvt. Ltd.
Manoj Banshilal Pachouri
ICFAI Business School
Scope of the project
The scope of this project extends to learning about latest developments and best practices in Supply Chain Management, Logistics, Sales & Distribution, Warehousing and Material Management practices. It will cover many industries like Automobiles, Watches, Paints, Home Appliances, and Telecommunication etc. • Identifying, mapping, measuring, objectively analyzing and improving business processes and practices within enterprise and across enterprise boundaries with customers, suppliers and business partners. Findings of this project will be used as an important document for developing Warehouse Management System (WMS) for Fairdeal Distribution Services Pvt. Ltd. Documentation of this project would be used to train and equip employees of Fairdeal with best industry practices. All the work done during this project is for the internal purposes of Fairdeal Distribution Services Pvt. Ltd. As all the information is confidential and proprietary, the presentations and reports including process flow maps of company will not be available for public disclosure.
Manoj Banshilal Pachouri
ICFAI Business School
Limitations of the Study
Third party logistics (3PL) is an emerging area in India and hence not much secondary data for Indian scenario is available for research purpose. • There is no ideal format of warehousing practices as they keep changing from company to company and are dependent on certain other parameters like type of goods handled, frequency of transactions, mode of transport etc also. Employees at Fairdeal Distribution Services Pvt. Ltd. remain busy in their daily chores and hence it is difficult to get their time for understanding processes they are handling. Since this project involves interacting with labors and store keepers who are relatively less aware of research projects, it is time consuming to convince them to participate and cooperate in surveys and interviews of the project. Some processes are carried out, partially or fully, at different locations like unloading goods, marking labels and storing goods are performed simultaneously. Hence it is not practically possible to go through entire process in one go. Some activities like receiving goods and scanning material are dependent on external factors like goods can be received only when lorry comes to depot. These external factors might increase time to analyze processes.
Manoj Banshilal Pachouri
ICFAI Business School
Proposed Methodology Figure 1: The Implementation Process Model Project Plan This project will be carried out in four phases namely – AS-IS Analysis TO-BE Analysis Process Mapping and Findings and Recommendations Manoj Banshilal Pachouri 9 ICFAI Business School .
revise the process flows and define any additional interventions required. performance measures). establish benefits targets. Put new organizational design in place. draw-up opportunity charts for benefits. Implement. carry out gap analysis (skills.These four phases will include Studying. do initial data gathering (e. 5. establish Key Performance Indicators (KPIs). 4. measure baseline KPIs. Analyzing. existing process maps. Redesigning and Implementing the various processes of Fairdeal Distribution Services Pvt. benefits tracking). organograms. carry out training. 2. Mapping. Ltd. and hand over to line management. develop high-level problem hypotheses. Description of various phases is as follows – 1. 3. Design the "TO-BE" process. Document the "AS-IS" process. Manoj Banshilal Pachouri 10 ICFAI Business School . refine the problem hypotheses. Run a pilot implementation where there are significant uncertainties about aspects of the new process or the organizational design. use this to adjust process flows. do micro-organization design. validate benefits. costs). define roles and responsibilities (RACI). Define the process and establish its boundaries. establish performance measurements (KPIs. set up Service Level Agreements (SLAs). and develop implementation plans.g. operational plans.
• • • • • 4. • • • • • 3. • • • • What are organizations People Process Controls Structure Processes and Organizations The functional decomposition Relating processes and organizations Identifying who does the work Relating people to processes Assessing the impact of various types of automation Processes And Documents The document flow concept Document flow techniques Measuring document flows The process context of documents The document context of processes Processes and Locations The location model Identifying where the work is done Relating people to processes Assessing the impact of location change Manoj Banshilal Pachouri 11 ICFAI Business School .Detailed tasks to be performed 1. • • • • 2.
• • • • 8. resource utilization Process quality and measures Measures and best practices Workflows Workflow concepts Workflow techniques Measuring workflows Building complex workflows Using the Time Lens • Gathering cycle time. and wait time • Identifying value-adding activities Manoj Banshilal Pachouri 12 ICFAI Business School . Processes and Technology The technology model and architecture Relating processes and technology Relating technology to processes Assessing the impact of technology change Process Measurement Types of measures Matching the measures with flow types Measures and maps ‘AS IS’ and ‘TO BE’ measurement Measure cycle time. • • • • 6.5. • • • • • • • 7. queue time. process time.
9. • • • • • • The ‘AS IS’ Process Suite Identifying the core processes Identifying opportunities for improvement Identifying new process opportunities Defining key process requirements Organizing the ‘As Is’ document Preparing the ‘To Be’ input 10. Migration and Transformation • • • • • Identifying the process transformations Assessing the migration of enablers Identifying sensitivities Assessing alternatives Preparing the migration plan Manoj Banshilal Pachouri 13 ICFAI Business School . Process maps and the level of detail • Macro level flow chart • Functional-activity level flow chart • Task and procedural level 11. The ‘TO BE’ Process Suite • • • • • • Designing new processes Revising old processes The integration method and process Integrating multiple processes Vertical and horizontal integration Integrating across business partners 12.
Integrating all the data collected and preparing a knowledge bank. Manoj Banshilal Pachouri 14 ICFAI Business School .To complete above mentioned tasks other activities that will be performed will include Collecting the artifacts regarding the Logistic and Warehousing. Personal interviews with warehouse staff. Proposing recommendations based on the findings of the project. Preparing a document which will capture all the processes of Logistics. Preparing process flowcharts and maps and finding out processes that need to be redesigned. Warehousing and Material Management.
and wait time 08-03-06 Complete process matrices 18-03-06 Complete “AS-IS” Analysis 25-03-06 Point out the processes which need improvement 02-04-06 Finish personal interviews with warehouse staff 04-04-06 Design new processes 10-04-06 Integrate multiple processes 21-04-06 Complete “To-Bo” Analysis 25-04-06 Identifying Process Gaps 10-05-06 Complete Industry Interaction to get best practices 15-05-06 Document all the findings of the project Manoj Banshilal Pachouri 15 ICFAI Business School .Project Schedule Table 1: Project Schedule Date Description 16-02-06 Learning Processes and Organization 18-02-06 Introduction with warehouse and its staff 20-02-06 Learning Processes and Technology 21-02-06 Process Measurement 21-02-06 Understanding Workflows 28-02-06 Gathering cycle time. process time.
The whole concept of Logistics is based on 7 R's which are:• • • • • • • Right Right Right Right Right Right Right Place Time Quantity Quality Price Condition Customer Logistics activities.INDUSTRY ANALYSIS Logistics Industry Logistics is a part of supply chain and is defined as "the process of planning. in-process inventory. as a part of Supply Chain Management comprises of the following: • • • • • • • • • • Purchase and Supply Material Handling Production Planning Production Control Transportation Storage Distribution Product Management Installation and Servicing Strategic Management Manoj Banshilal Pachouri 16 ICFAI Business School . internal and external movements) in order to satisfy customer's requirements. implementing and controlling the efficient. Logistics is also defined as time related positioning of resources. finished goods. services and related information right from the point of origin to the point of consumption (including inbound. effective flow and storage of raw materials. out bound.
System.A well designed Logistics chain is expected to support the strategic objectives of: • • • • • • Reduced Costs Shorter Lead Time Flexibility Enhanced Service Better Product Availability Better Product Reliability The best configuration of the chain will vary from individual chain to chain and individual organization to organization. For example: In a manufacturing industry. Logistics plays a significant role in the management of entire supply chain. In all the activities there is a flow of goods whether it is raw materials or WIP or semifinished goods or finished goods. Technology. Logistics plays a key role in Supply Chain Management as there is a strong inter-play of activities starting from raw materials till the finished goods. The pre-requisite infrastructure required to provide logistics solutions are: • • • • • • • Land and Building (Warehouse) Trained Manpower Material Handling Equipments Hardware and Software Transport Network Vendors Consultants Manoj Banshilal Pachouri 17 ICFAI Business School . Relations. in all the case the architecture of the chain would include the following three elements . But.
Fire Act: Insurance claims and damages due to fire come under Fire act. Pollution Act: Logistics activities should environment which may harm social set up. This tax varies on product to product basis. not pollute the • • • • • Industry Act: Being in distribution and transportation industry. Logistics. Municipal Corporation are some of the examples. Also. Excise Duty: This is the tax payable at the factory location on the value of products manufactured by the company. • • Manoj Banshilal Pachouri 18 ICFAI Business School . Local Taxes: These taxes include local sales taxes. Transporter’s unions. Sanctions from appropriate bodies: There are many central and local bodies whose permission is required to carry out logistics operations. Labor Acts: According to these acts. every logistics provider will have to comply with distribution and transportation industry regulations. road taxes etc. minimum of 8.33 % of annual salary of worker has to be awarded as bonus. Material can be insured against fire up to dealer’s point or up to CFA point. Warehousing and Clearing & Forwarding. Octoroi taxes.Legal Issues in Logistics Industry There are some legal issues involved with the operations of Supply Chain. minimum wage has to be given to every labor under Wages Act. Some of the legal issues involved are: • Conforming and non-conforming areas: Warehouses and transport locations can not be set up in residential areas and are not permitted by law.
Strategic Outsourcing: Based on long-term relationships with successful outcomes. services and related information. in which transportation is a major element in the entire chain. implementing and controlling the efficient. with no long term contracts and no bonding between the 3PL and the outsourcing company. Third Party Logistics (3PL) companies or Clearing & Forwarding Agents (C&FA) all over the world have become important channel in Supply Chain Management (SCM) and Sales & Distribution (SD) to manage logistics operations network. Level of outsourcing of in-plant logistics and third party logistics is mainly of following types: Levels of Outsourcing • Transactional Outsourcing: Based on transactions. finished goods. effective flow and storage of raw materials. 3PL companies become partners in supply chain management and establish transactional transparency. in-process inventory. Tactical Outsourcing: Outsourcing on a long term basis with negotiated contacts and integrated IT systems to facilitate free information flow and create supply chain visibility. Third party logistics Third party logistics is the activity of outsourcing activities related to Logistics and Distribution. • • Manoj Banshilal Pachouri 19 ICFAI Business School .How is logistics different from transportation? Transportation is physical movement of goods (inbound and outbound) as well as picking up of products as per customers order and delivering it to the ultimate user whereas Logistics encompasses several activities related to supply chain management such as planning. The 3PL industry includes Logistics Solution Providers (LSPs) and the shippers whose business processes they support.
Some other reasons companies opt for Third Party Logistics are following: • • To Save Time: Outsourcing the Logistics function can free up resources to focus on core competencies. Cost saving/ cost optimization: Economies of scale and supply chain and logistics expertise of dedicated third party logistics provider may reduce the cost of logistics. another organization within the supply chain may be able to do it better. supply chain expertise and economies of scale. For more professional and scientific approach to logistical problems: Logistics outsourcing reduces problems arisen of truck accidents. Efficient management of inventory resulting in better utilization of working capital: finished goods can be transferred from one clearing & forwarding agent to other through stock transfer for better movement of goods and hence better inventory management. To Share Responsibility: 3PL companies can share responsibility for managing global supply chains. keeping customers and stores properly stocked. Insurance claims. simply because its relative position in the supply chain. Because Someone Else Can do it Better: Even if you have resources available. warehousing and IT resources which might not be possible for a medium sized or small sized company. transportation. reverse logistics etc which can be handled by 3PL very efficiently. • • • • • • Manoj Banshilal Pachouri 20 ICFAI Business School . Octoroi claims. To Re-Engineer Distribution Networks: Logistics outsourcing can be a quick way to re-engineer distribution networks to meet global market demands and gain a competitive edge. and delivering the perfect order every time. Resource constraints: In-house logistics and supply chain management requires heavy investment in infrastructure.Why Use Third Party Logistics? Main reason for outsourcing Logistics or Clearing & Forwarding operations to third parties is that it allows manufacturing company to concentrate on their core competencies. Sales tax filing.
with more than half the goods in India being moved by road. such as transportation of clinical samples for pathological labs and medical institutions and reverse logistics that involve movement of defective products from the dealers back to the factory.46 billion in 2003. increasing global trade and MNCs investments in India. Third party logistics service providers in India are gearing up to meet the growth demand.4 per cent during the next five years. cement and textiles were identified as the top five contributors to the revenues of the logistics industry. by 2020. with the market likely to grow at a CAGR of 6. competitive pressure. The transportation cost accounts for nearly 40 per cent of the cost of production. FMCG. and manufacturing and FMCG sectors are increasingly opting to outsource their logistic requirements to specialized service providers. Chemicals. According to industry sources. IT hardware and FMCG companies are the major users of 3PL services. this industry is expected to represent almost 30 per cent of the global air cargo with an average annual growth rate of 10 per cent. For example: Gati is planning to add new services in its portfolio. In fact. In India the logistics costs are still higher than in the developed markets — it is estimated to be around 13 per cent of GDP. Industry analysts say that the key drivers for logistics outsourcing are the corporate trend of focus on core operations. incorporating value-addition in their services and customizing their supply chain management solutions. Indeed. the trend in the industry is towards the third party logistics (3PL) concept — the market size for this category of service was estimated at $250 million in 2003. The market for 3PL services is likely to grow at a CAGR of 20. At present. especially in the automotive.2 per cent during the next five years. with the growth being fuelled by the entry of MNCs and export focus of Indian companies. against 9 per cent of GDP in the US. metal.3PL Is Growing THE Indian logistics industry is poised for a significant growth in the coming years as new companies. a recent study on the logistics market by Frost & Sullivan has estimated that the revenue of the logistics industry from the manufacturing sector alone was $13. Manoj Banshilal Pachouri 21 ICFAI Business School . the automotive. pharmaceutical.
the retail industry is expected to jump into the 3PL bandwagon. labeling and packaging. only a few 3PL companies achieve strategic status with their customers. with such large retailers as Shoppers Stop and RPG expanding to smaller cities.One sector that is increasingly looking for outsourcing logistics is textiles. They do it by constantly innovating and maintaining operational integrity. 3PL service providers are expanding their basket of services as companies are now looking for more than just transportation of their products and raw materials. especially as it is facing the challenges of exacting delivery requirements and multiple export markets. The logistics firms are also focusing on related services such as customer clearing and forwarding. Source: The Hindu Business Line Achieving Strategic Outsourcing Unfortunately. Also. Manoj Banshilal Pachouri 22 ICFAI Business School . Some use an open-book costing method to demonstrate their system's transparency. inbound warehousing. Realizing the potential in the outsourced logistics market. fleet management. this sector is bound to outsource logistics in the coming years. order picking and inventory management. Analysts say that with large retailers such as Wal-Mart and Target seriously evaluating new suppliers for textiles in India.
Lesser co-ordination between branch offices and 3PL agency. • • • • • Manoj Banshilal Pachouri 23 ICFAI Business School . Threat of leakage of operational competencies to competitors. Poor transportation infrastructure of India might lower the profit margin E-Commerce is emerging as a primary threat to 3PL industry. Lack of proper set of skilled man power Forged bills and claims by 3PL provider agency.Third Party Logistics Industry: SWOT Analysis Table 2: SWOT Analysis of 3PL Industry STRENGTHS • • • • Quick way to re-engineer distribution networks Enhanced distribution and transportation Service Time Saving in servicing customer Flexibility in restructuring distribution networks and expansion plans Economies of scale in distribution OPPORTUNITIES • • Better utilization of working capital Fast expansion of principal’s business without investing in infrastructure and transportation resources Cost optimization as a result of fast and efficient processes Concentration on core competencies • • • • • • WEAKNESSES Lesser control over outsourced third party activities. Difficult to switch 3PL provider agency. • THREATS Value Added Tax (VAT) might effect 3PL industry as distribution channels would be trimmed.
customer support and supply chain technology. Manoj Banshilal Pachouri 24 ICFAI Business School . capabilities. with the aid of process and organizational changes. information technology. taking special care to consider the dimension of human resources and organizational change. distribution management. A standard 4PL supply chain solution involves four distinct steps: Step I: Reinvention At this level. Step II: Transformation Here the focus is on coordinating specific supply chain functions such as sales and operations planning.Fourth Party Logistics (4PL) Industry Fourth party logistics provider is a supply chain integrator that assembles and manages the resources. the overall business strategy is aligned with supply chain strategy to reengineer the supply chain of the participants. etc. and technology of its own organization with those of complementary service providers to deliver a comprehensive supply chain solution to the client. Step IV: Execution A 4PL provider's scope of responsibility also includes operational responsibility for numerous supply chain functions. as applicable. besides the traditional transportation management and warehousing operations logistics outsourcing. T&D. Step III: Implementation The implementation is done on the basis of recommendations made at the earlier two levels and the transition is put across to the 4PL delivery team. procurement strategy.
and avoid last minute urgent shipments Replenishment model at the VOI warehouse helps supplier plan his production in a better way Manoj Banshilal Pachouri 25 ICFAI Business School . as the supplier holds the stock for the principal company With the stock point in the vicinity of the manufacturer. leads to improved efficiency Increased control on service levels and inventory accuracy. Design & Development etc. with clear & measurable objectives and targets. where the stock ownership to manufacturer happens only when it is required to be produced. Some of the benefits of In-plant stores outsourcing are: • • • Focused & dedicated approach to stores function by skilled & experienced warehouse personnel. as it is directly linked to 3PL’s revenue Specialized labor management model gives substantial cost reduction in terms of labor cost. VOI works on a pull based system. timely feeding to the production line can be done Your Supplier benefits by reducing his warehousing space. along with tremendous flexibility and improved efficiency Manufacturers can then focus and allocate their resources on specialized areas like production. Some of its benefits are: • • • • Reduced inventory holding cost. it is becoming increasing costly for manufacturers to ensure timely inputs to production lines. • Vendor Owned Inventory Management With multiple supplier having different locations and lead times.In-plant Stores Outsourcing The in-house/in-plant stores activity is managed by a 3rd party logistics provider (3PL).
materials handling is very important to outbound logistics. locating stock. value-adding competitive tool. and rapidly preparing orders for shipment to customers. The proximity of market-oriented warehousing to the customer allows a firm to serve the customer with shorter lead times. Firms need to integrate materials handling requirements not only for the company's departmental needs. semi-finished goods. In inbound logistics terms. Material Handling has four dimensions: • • • • Movement Time Quantity Space Material Handling improves efficiency by making the logistics system respond quickly and effectively to plant and customer requirements. Material Handling Material Handling is the process of efficient short-distance movement of goods that usually takes place within the confines of a building such as a plant or a warehouse or between a building and a transportation agency. or finished goods for varying periods of time. accurately filling orders.Warehousing A warehouse is a point in the logistics system where a firm stores or holds raw materials. It creates time utility for raw materials. Manoj Banshilal Pachouri 26 ICFAI Business School . There are as many as 700 organizations in India engaged in the business of clearing and forwarding. materials handling serves company plants in the same way. industrial goods and finished products. but also for meeting their customers' needs. For efficient movement of goods into the warehouse. This warehousing function continues to be increasingly important as companies and industries use customer services as a dynamic.
in-process inventory. where soft drink bottles are returned and reused repeatedly The Council of Logistics Management defined reverse supply chain as "The process of planning. leave them to a third party or destroy them. Efficient reverse supply chains bring many benefits to the companies.Reverse Logistics (Returns Management) Companies spend more time and money in fine-tuning their forward supply chains while ignoring their backward supply chains. cost effective flow of raw materials. implementing and controlling the efficient. known as reverse supply chain or backward supply chain. A common example of reverse supply chain is the soft drinks bottles pickup and delivery system. companies have long ignored this part of the supply chain. re-sell them. However. But companies are more likely to benefit if they can also make use of the information that comes back with returned merchandise. Manoj Banshilal Pachouri 27 ICFAI Business School . finished goods and related information from the point of consumption to the point of origin for the purpose of recapturing value or proper disposal. in today's competitive business environment when there is both external and internal pressure. companies can no longer ignore reverse supply chains. However." As far as managing the returns are concerned companies re-use them. reverse supply chains are different from forward supply chains and most of the existing forward supply chains are not designed to handle reverse supply chains. Though reuse of products and materials is a common phenomenon.
processing returned merchandize due to damage. seasonal inventory. and asset recovery.Figure 2: Reverse Logistics Cycle Reverse logistics also includes remanufacturing and refurbishing activities. recalls. restock. hazardous material programs. salvage. Manoj Banshilal Pachouri 28 ICFAI Business School . excess inventory and recycling programs. obsolete equipment disposition.
either directly or indirectly. (d) Arranging dispatch of goods as per the directions of the principal by engaging transport on his own or through the authorized transporters of the principal.Clearing and Forwarding Agents "Clearing and forwarding agent" has been defined as "any person. (c) Receiving dispatch orders from the principal. (e) Maintaining records of the receipt and dispatch of goods and the stock available at the warehouse. A clearing and Forwarding agent normally undertakes the following activities(a) Receiving the goods from the factories or premises of the principal or his agents. (b) Warehousing these goods. This is usually given as a percentage of the turnover. For their services rendered. the C&F agent receives commission or remuneration which usually consists of two components: o Minimum commission on a flat rate or turnover basis depending on the packages/consignments handled. who is engaged in providing any service. in any manner to any other person and includes a consigning agent. (f) Preparing invoices on behalf of the principal. connected with clearing and forwarding operations. o The above two constitute the remuneration or commission paid to the C&F agent by the principal. Manoj Banshilal Pachouri 29 ICFAI Business School . there is a contract between the principal and the clearing and forwarding agent detailing the terms and conditions and also indicating the commission or remuneration to which the C&F agent is entitled. A variable commission based on performance which is computed on the performance indicators agreed upon between the agent and the principal." Normally.
BPL Sanyo. technical know-how. Hosur (Tamilnadu) and Dehradun (Uttaranchal) to Sequel Logistics. unless repugnant to the context or meaning thereof. Keeping in mind the globalization of the industry and international trends. efficient and reliable services. Titan Industries outsourced In-plant Logistics to both their plants. TVS Motor. Fairdeal has invested heavily in infrastructure . shall mean and include its successors and permitted assigns). Fairdeal manages over 40. 3000 Crores and has employee strength of over 300 and also handles secondary movement for which have over 25 dedicated vehicles. infrastructure and intellectual property for the management. 1956 and having its Registered Office at 431. Ltd. Today. well laid warehouse of over 50000 sq ft at Sharkhej in Ahmedabad. For this purpose Sequel Logistics Pvt. Fairdeal has a modern. it was decided in March 2004 to widen the scope of service offering and move up in value chain. Republic of India (hereinafter referred to as ‘Fairdeal’ which expression.000 SKUs at 5 different locations. Gujarat.. Ahmedabad. a company incorporated and registered in 1975 under the Companies Act. in addition to Watch Division of Titan Industries. and Precision Engineering Division of Titan Industries. Bopal-Ghuma Road. 380058. Ltd.ABOUT FAIRDEAL Fairdeal Distribution Services Pvt.to provide effective. maintenance and administration of all operations in Supply Chain Management Industry. Currently. experience. And today our client list includes Ashok Leyland. Gujarat. Manoj Banshilal Pachouri 30 ICFAI Business School . 2004. Madura Garments. expertise. It has a dominating presence as a ‘Clearing & Forwarding Agent’. Material handled by the group is valued at over Rs. resources. On 1st April. Chetan Society. Fairdeal has represented that it has the requisite knowledge. was established.warehouses and vehicles . It is handling inbound logistics for diamond for Titan Industries from Surat.
order management and related IT solutions • To deliver high Operational Efficiency and superior Customer Service by: o Constantly upgrading and adhering to World Class Systems & Processes o Placing emphasis on being Information / Data driven o Emphasis on Technology (IT & Others) o Being Customer focused. comprehensive and customized solutions and services Business Objective • To build and offer World Class Supply Chain services in the areas of warehousing & distribution. build and deliver superior supply chain solutions. to achieve highest level of efficiency. by offering innovative.Vision. inventory management. Transparent & Ethical Manoj Banshilal Pachouri 31 ICFAI Business School . Mission and Business Objectives Vision To constantly innovate. speed and profits Mission To be the most preferred Supply Chain Solution Provider in India.
Diversification came in 1987 by taking up 'Clearing & Forwarding Agency' of TITAN. • Zankar Jobanputra He is a science graduate in mathematics and has 10 years experience in C&F business. It also manages secondary freight for the clients. The firms were into retail distribution of 'Fast Moving Consumer Goods' for many years.History The first Group firm was established in 1975 and was carrying out business in office equipments.. In 1978. Since then Fairdeal has grown to become a major 'Logistics Service Provider' in Gujarat and represents over twelve clients in the state of Gujarat. He has worked in Supply Chain Department of Titan Industries and worked with Madura Garment as Supply Chain Manager. Ltd. Directors • Sharad Jobanputra He is a science graduate in microbiology and has 30 years of experience in various businesses and founder of Fairdeal Group. Colgate-Palmolive etc. the firm started FMCG distribution and was associated with The Tata Oil Mills Co. Manoj Banshilal Pachouri 32 ICFAI Business School . • S Rajkumar He is a mechanical engineer and has done MBA from IIM-C.
Reliance Retail from June 2006. Dabur and currently he is Managing Director of Bombay Dyeing. He has a very wide experience of working with Colgate-Palmolive. He teaches Operation Research in IIMA and has special interests in Supply Chain & Logistics. India & China. an MBA from IIMA and a doctorate from Kellogg School of Management. Japan & Nigeria. Manoj Banshilal Pachouri 33 ICFAI Business School .Independent Directors • Ninu Khanna He is a science graduate and an MBA from IIM-C. Procter & Gamble. He is also a visiting faculty to national and international business schools. India. Indian Hotels. • Jamshed Daboo He is a mechanical engineer and an MBA from XLRI. Jamshedpur. Madras. These independent directors will give Fairdeal group outside view as Fairdeal grows in terms of geographical scope and physical scale. He has wide experience of working with Titan Industries and Tata Quality Management Services and currently he is COO – Business Hotels. • G Raghuram He is an electronics engineer from IIT. He will be CEO-FMCG Vertical. He has published several books and papers in national and international publications.
Automobile Lubricants. Domestic Appliances. Some of its fields of operation are: • In-plant logistics • • • • • • • Reverse logistics Third Party Logistics Manufacturing Logistics Manufacturer to Consumer (M2C) Logistics Warehousing Clearing and Forwarding Agents Transportation Product Range Table 3: Product Range of Fairdeal Consumer products Automotive Parts Tea. Telecommunication. Consumer Electronics. Industrial Electricals. Video. Processed Food Products. Vegetable Oils.Business Focus Fairdeal Distribution Services Pvt. Auto Electricals. Lighting. Mobile Audio Systems. Coffee. Industries Paints and other Coating Products. Spark Plugs. Auto Batteries. Auto Filters. Watches. Power Transmission Systems. Jewelry Ceramic Tiles . provides complete Supply Chain solutions to its clients. Auto Bulbs. Breakfast Cereals. Audio. Vanaspati.Floor & Wall Consumer Durables Construction Material Manoj Banshilal Pachouri 34 ICFAI Business School . Ltd.
Locations Ahmedabad Bangalore Dehradun Hosur Surat • • • • • • Clearing & Forwarding at Ahmedabad Warehousing at Attibele o TVS Motor Company Limited In-plant Logistics at Bommasandra o Titan Industries Limited-Precision Engineering Division Supply Chain Management at Bangalore o Madura Garments In-plant Logistics at Dehradun o Titan Industries Limited-Watch Division In-plant Logistics at Hosur o Ashok Leyland Limited-Plant-2 o Titan Industries Limited-Watch Division • • Clearing & Forwarding at Hosur o BPL Sanyo Limited Inward Logistics at Surat o Titan Industries Limited-Jewellery Division Manoj Banshilal Pachouri 35 ICFAI Business School .
and Sai transport Agency. DTDC. Local orders are dispatched through company’s own vehicles and up-country orders are dispatched through its business partner carriers and courier services. Patel roadways. It has its own transport vehicles as well as it has business contract with other transport carriers also. At present Fairdeal Distribution Services Pvt. Indo Arya Central Transport Ltd. AS Transport. is handling logistics operations of various industries which include: • Automobiles Industry • Paint Industry • Watches Industry • Branded Jewellery Industry • Snacks & Food products Industry • Electronic home appliances industry • Telecommunications Industry • Tea Industry Manoj Banshilal Pachouri 36 ICFAI Business School .. BlueDart. Shivraj Roadlines.Distribution Network Fairdeal has a strong distribution network all over India. Unifreight. Ltd. Transport Corporation of India. prasanna cargo. Logisys India Limited. Some of transporters and courier service providers carrying dispatching orders of Fairdeal are Gati.
mining and construction. Manoj Banshilal Pachouri 37 ICFAI Business School . Client Companies Fairdeal Distribution Services Pvt. Largest projects exporter in Mechanical. Voltas is: Leader in air conditioning projects. Ltd. Electrical and Public Health works. All these capabilities are ISO 9001-2000 certified. pollution control and chemicals. two brand in air conditioners. refrigeration. Leader in textile machinery. No. installation and servicing of technology based systems. and in being a representative of global technology leaders. ventilation and air conditioning. Leader in forklift trucks. Premier Player in machine tools. It offers engineering solutions for a wide spectrum of industries in areas such as heating. the management and execution of airconditioning and public work projects. Voltas is India's premier air conditioning and engineering services provider.Lighting Trophy by Philips India Limited.Awards and Achievements • • Awarded Model Warehouse status by Hindustan Lever Limited. materials handling. is Clearing & Forwarding Agent for following companies whose brief corporate profile is given below: Voltas Established in 1954. textile machinery. machine tools. building management systems. Most trusted name in mining and construction equipment. Awarded Best Run Depot of the Country trophy and Best Customer Service . climate control. the procurement. water management. The company's strengths lie in the design and manufacture of industrial equipment.
and Sanathnagar (Andhra Pradesh). Voltas has factories at Thane (Maharashtra). Kolkata. Bangalore. freezers. commercial refrigerators.Areas of business Operations Voltas' operations are organized specific clusters: air conditioning international operations business group and engineering products divisions has independent facilities servicing. Jamshedpur.. It has territorial offices in Ahmedabad. Chandigarh.com/ voltas/media/index. These products bear the stamp of state-of-the-art automated manufacturing plants. high-quality refrigerators and room air conditioners.tata. forklift trucks and large water supply pumps. Hyderabad. resulting in consistently high quality and reduced costs. Hong Kong and Singapore. Lucknow. water coolers.voltas.htm Manoj Banshilal Pachouri 38 ICFAI Business School . Location Voltas has its head office in Mumbai and zonal headquarters in Mumbai. Sources: http://www. for 'manufacture only' alliances producing low-cost. unitary products business business group.com/ http://www. the union territory of Dadra. viz. while the overseas offices are located in Abu Dhabi (UAE).htm http://www. Pune and Kochi.tata. New Delhi and Chennai. Voltas has partnered with international companies. air conditioners. LG Electronics of Korea and Fedders International of USA.com/voltas/index. Each of these for market coverage and customer Manufacturing Voltas manufactures industrial air conditioning and refrigeration equipment. group. into four independent businessand refrigeration business group.
Further. the company transformed the Indian watch market. Areas of business Titan manufactures over 7 million watches per annum and has a customer base of over 65 million. Titan leveraged its manufacturing competencies and branched into precision engineering products and machine building in 2003. manufactured at its state-of-the-art factory at Hosur. Established in 1984 as a joint venture between the Tata Group and the Tamilnadu Industrial Development Corporation. Manoj Banshilal Pachouri 39 ICFAI Business School . Notable among them are: Titan Edge – the world’s slimmest watch. Dehradun and Himachal Pradesh. offering quartz technology with international styling. Titan for the premium segment and Sonata for the below-$25 category. Tamilnadu. Titan has also diversified into fashion eyewear with its Fastrack Eye Gear sunglasses. and Fastrack in the sporty casual category. the company launched a second independent watch brand — Sonata — as a value brand to those seeking to buy functionally styled watches at affordable prices. Nebula – in solid gold and precious stones. Flip – India’s first and only reversible watch with two movements and dial faces. the company diversified into jewellery under the brand Tanishq. each of which is a leader in its segment.Titan Industries Titan Industries is India’s leading manufacturer of watches and jewellery and the world’s sixth largest manufacturer brand of watches. The Titan brand architecture comprises several brands. In 1995. the Gold and Steel collection. The company has manufacturing and assembly operations at Hosur. It also entered the segment of premium fashion watches by acquiring a license for global brands such as Tommy Hilfiger. Raga 9 to 5 – for the woman achiever. Its main products are: Watches: Titan manufactures two main brands viz. Leveraging its understanding of different segments in the watch market.
com/comp/titan/ http://www.htm http://www. in the Consumer Durables category.Today. Its exclusive retail showroom chain – World of Titan – is amongst the largest in its category. Achievements Titan Industries has been awarded the following: • • • • • The President of India’s Award for employing the disabled. Friends of BIL Award for employing the handicapped.htm Sources: Manoj Banshilal Pachouri 40 ICFAI Business School . http://www. The Titan Design team received 7 accreditations at the NID — Business World Awards. including the 'Young Design Entrepreneur of the Year'. Titan retained it ranking as the 'No 1 Brand' in the Brand Equity Survey.titanworld. Platinum jewellery and designer silverware are also a part of the product range.com/titan/media/index.com/ http://www. Spain.indiainfoline. Titan has over 60 per cent of the domestic market share in the organized watch market.com/titan/index.300 cities and internationally in over 30 countries including the UK.tata. Tanishq has 75 boutiques in 55 cities across the country with a premium range of gold jewellery studded with diamonds or colored gems and a wide range in 22kt pure gold.000 outlets in over 2. It also supplies precision components to the avionics and the automotive industry. Tanishq is one of India’s largest specialty retailers and is transforming the jewellery market in India.tata. Jewellery: Tanishq is India’s largest and fastest growing jewellery brand. Titan and Tanishq were adjudged 'Most Admired Brands' as well as 'Retailer of the Year' by Images Fashion Forum. Greece and countries in the Middle East and Asia Pacific. Precision engineering: The Company’s precision engineering division manufactures dashboard clocks as OEM to car manufacturers in Europe and America. Titan watches are sold through over 9.
and 51 tea estates in the states of Assam. Among India's first multinational companies. Manoj Banshilal Pachouri 41 ICFAI Business School . The unit's product is made from a unique process. the Tata Tea Group of Companies. Kanan Devan. Overseas business The Tata Tea and Tetley portfolios of branded offerings sourced from the India based JV. Chakra Gold and Gemini — catering to all major consumer segments for tea. of extraction from tea leaves. Poland. giving it a distinctive liquoring and taste profile.500 hectares under tea cultivation. This is independent of the manufacturing and supply operations of its Tetley and other subsidiary companies. and investment income. developed in-house. coffee. Tata Tea produces around 60 million kg of black tea annually. North Africa. With an area of 26. The company has its headquarters in Kolkata.350 Stockists caters to over 1. Tamilnadu and Kerala and one coffee estate in Tamilnadu. Russia and Kazakhstan markets.Tata Tea Set up in 1964 as a joint venture with UK-based James Finlay and Company to develop valued-added tea. West Bengal. which includes Tata Tea and the UK-based Tetley Group. iced tea mixes and in the preparation of ready-to-drink (RTD) beverages. The consolidated worldwide branded tea business of the Tata Tea Group contributes to around 86 per cent of its consolidated turnover with the remaining 14 per cent coming from bulk tea. Middle East. West Asia. today represent the world's second largest global branded tea operation with product and brand presence in 40 countries. Tetley. Products and brands The company has five major brands in the Indian market — Tata Tea. Instant tea is used for light density 100 per cent teas. Tata Tea's distribution network in the country with 38 C&F agents and 2. caters specifically to the Australian. the operations of Tata Tea and its subsidiaries focus on branded product offerings in tea but with a significant presence in plantation activity in India and Sri Lanka.7 million retail outlets (ORG Marg Retail Audit) in India. Kerala. The company has a 100 per cent export-oriented unit (KOSHER & HACCP certified) manufacturing instant tea in Munnar. which is the largest such facility outside the United States.
Tata-Tetley is a Kochi-based EOU which services the branded business of specific Tetley and Tata Tea markets outside India. The Tetley Group headquartered in Great Britain. R&D capability and plantation assets of around 8000 hectares. is a leading international tea company selling over 60 Tetley branded products to over 40 countries world-wide. based on sourcing of Instant Tea products out of Munnar. Sources: http://www. Australia.tata.htm Manoj Banshilal Pachouri 42 ICFAI Business School . Kerala. producing over 9000 MT of coffee annually.com/ tata_tea/media/index. Tata Coffee with instant coffee manufacturing facilities.com/ http://www. Tetley is the second largest tea bag brand in the world.Subsidiaries Tata Tea has subsidiaries in Great Britain.tata.tatatea. Tata Tea Inc in the United States processes and markets instant tea from its facility in Florida.htm http://www. United States and India.com/ tata_tea/index. Poland and France. is the largest coffee plantation company in Asia. it is the number one tea bag brand in Great Britain and Canada and has significant market shares in the United States.
oil & gas. an Amara Raja-Johnson Controls Company with 26% equity from Johnson Controls is the technology leader in the Indian storage battery industry and the leading player in standby VRLA batteries.com/ Manoj Banshilal Pachouri 43 ICFAI Business School . and is part of its global alliance. Sources: http://www. Amara Raja Batteries Limited (ARBL). NSE and HSE. a little dream…a dream realized by Mr. The ARBL scrip is actively traded on BSE. and preferentially to Hindustan Motors. like anything else. an NRI who incorporated the company in 1985 with a vision to transform the business. General Motors. Mahindra & Mahindra and Ashok Leyland. Inc. In India ARBL supplies automotive batteries exclusively to Ford. DOT.amararaja.Amara Raja Batteries Limited (ARBL) Before it became one of the leading battery makers in India. power. Amara Raja has joined hands in a strategic partnership with Johnson Controls. Ramachandra N Galla. Indian Railways. etc. besides a host of companies in segments like UPS systems. Amara Raja was. DaimlerChrysler. ARBL is also a preferred supplier to major telecom MNCs.. Amara Raja and Johnson Controls both share a commitment to excellence and innovation and work towards exceeding customer expectations.
TVS commands a strong presence in manufacturing of two-wheelers. the flagship company of the USD 2. As one of India’s largest industrial entities it epitomizes Trust. The year 1980 is one to be remembered for the Indian two-wheeler industry. expansion and diversification.TVS Motors TVS Group was established in 1911 by Shri. there are over thirty companies in the TVS Group. TVS foresees to have profitable operations overseas.2 billion TVS Group. technology and marketing. Today. employing more than 40. especially in Asian markets. With steady growth. finance and insurance.2 billion. It also has vibrant businesses in the distribution of heavy commercial vehicles passenger cars. For the Indian Automobile sector. V. is the third largest two-wheeler manufacturer in India and among the top ten in the world. T. TVS Motor Company Limited. auto components and computer peripherals. with an annual turnover of over USD 650 million.000 people worldwide and with a turnover in excess of USD 2. capitalizing on their expertise in the areas of manufacturing. TVS Motor Company is the first two-wheeler manufacturer in the world to be honored with the hallmark of Japanese Quality – The Deming Prize for Total Quality Management. with the roll out of TVS 50. Future Focus TVS Motor Company wants to be one among the top two 2-wheeler companies in India and one among the top five 2-wheeler companies in Asia. it was a breakthrough to be etched in history. Manoj Banshilal Pachouri 44 ICFAI Business School . Value and Service. India's first two-seater moped that ushered in an era of affordable personal transportation. Sundaram Iyengar. The Company aims to hone and sustain its cutting edge of technology by constant benchmarking against international leaders.
tvsmotors. Launched India's first 5-speed motorcycle. India’s first fully indigenously designed and manufactured motorcycle. Launched TVS Victor. in August 2001.Many firsts of TVS Motors India’s first two seater 50 cc Moped TVS 50. Sources: http://www. 4-stroke 110 cc motorcycles. Launched TVS Victor. 4 stroke motorcycles in April 2000. TVS Scooty in June 1994. First Indian Company to motorcycles in Sept 1984. a 100 cc motorcycle which is ideal for rough terrain. Launched TVS Star in Sept 2004. Launched TVS Fiero. the 110cc Shogun in Dec 1996. introduce 100cc Indo-Japanese (sub-100 cc Launched India's first indigenous Scooterette variomatic scooters). Launched TVS Centra in January 2004. India’s first 150 cc. Introduced India's first catalytic converter enabled motorcycle. a world-class 4-stroke 100 cc motorcycle with the revolutionary VT-i Engines for bestin-class mileage. launched in August 1980. the Shaolin in Oct 1997. in February 2005.com/ Manoj Banshilal Pachouri 45 ICFAI Business School . 4-stroke 125 cc motorcycle.
MICO has strong presence in the Indian automotive components business with a virtual monopoly in the Diesel Fuel Injection Equipment. Auto-Electricals. machine tools accessories etc began in 1987. with its registered office at Madras. The company has since its 50th year embarked on a share buyback pursuant to its allowance by the Government. Blaupunkt Car Audio Systems. Robert Bosch’s other business interests include consumer goods. MICO manufactures nozzles & nozzle holders. Its other products include large number of automotive accessories as well as Special Purpose Machines. In 1986 it began manufacture of mini spark plug (extension of its spark plugs range) for motor cycles. MICO embarked on manufacture of starter motors.5% subsidiary of Robert Bosch. a global leader in the field of auto components. Robert Bosch. Gear Pumps for tractor applications and Packaging Machines. communication technology and capital goods. alternators. hydraulic products and auto Electricals including spark plugs. FIPs. Manufacture of special purpose machines. Electric Power Tools. the Mysore Branch of the Central Bank of India Ltd. which was later shifted to Bangalore in 1953. Parent company MICO is a 60. Spark Plugs segments and also in the Electric Power Tools segment. hydraulic and pneumatic equipment etc in 1989-90. which was till then being imported. Industrial Equipment. In 1969. Germany. Manoj Banshilal Pachouri 46 ICFAI Business School . has presence in more than 130 countries.Motors Industry Company Limited (MICO) MICO was incorporated in 1951 as a subsidiary of Rober Bosch. offered for sale 22000 shares of the Company to the public at a premium of Rs70 per share. The Company has continuously modernized and upgraded product range.
Company's operating profit was at Rs2. The operating profit declined by 20% from Rs 745 mn to Rs 594 mn in Q1 2002.bosch. Other income increased by 23% from Rs71 mn in Q1 2001 to Rs87 mn. Net profit declined to Rs 257 mn in Q1 2002 from Rs 269 mn in Q1 2001. Sources: http://www.micoweb.5 bn. The Nashik plant achieved new milestone in producing the 50 millionth nozzle holder assemblies. emission and greater safety of the end users.9 bn in Q1 2001 to Rs 3. innovation and keep customer satisfied. Plant locations MICO has 3 plants.com/ http://www.in. one at Nashik for nozzles and nozzle holders. another at Bangalore for FIPs and hydraulic products and the third at Naganathapuram for auto Electricals including spark plugs.Quality.com/ Manoj Banshilal Pachouri 47 ICFAI Business School .MICO has adopted the Bosch guiding principle of BeQIK. innovation and continuous improvement to enhance customer satisfaction.6 bn.micobosch. The company has over 4000 sales and service outlets countrywide. company’s total sales decreased by 8%. Motor Industries Software Ltd and Motor Industries Trading Private Ltd. In Q1 2002.5bn and net profit was Rs 817mn for F12/01. The Bangalore plant achieved international quality levels in Single Cylinder Pumps. The company also has its own vocational training centers at Bangalore and Nashik imparting training in the state of the art technology to its workforce. In F12/01. The company plans to continue innovating by designing and developing diesel fuel injection systems taking cognizance of fuel consumption. The BeQIK philosophy has helped the company in achieving world-class quality. Subsidiaries MICO has two 100% subsidiaries. MICO's net sales were at Rs 14. from Rs3.
mtrs per day. New Zealand. Western India. sizes. Kenya and many more Awards and achievements: Felicitated by many awards including award from President of India for “Excellent Export Performance. Bell has tie ups with many international players for tiles manufacturing technology. strategically located near major Indian markets with production capacity of 30.000 sq.000 sq. dealers and retailers which are nationally connected through world class ERP software. which is environment friendly and energy efficient. has production capacity of 10. has an installed capacity of 20. Saudi Arabia. Singapore.bellceramics. Mauritius. mtrs of floor tiles per day. UAE. Philippines. The second plant located at Hoskote (Bangalore). Kuwait. clearing & forwarding agents. It has wide spread distribution network. The plant makes use of the world-renowned multi-line dry process technology. patterns and shades. mt/ per day which manufacture floor tiles and wall tiles in wide range of products. Qatar.com/ Manoj Banshilal Pachouri 48 ICFAI Business School . The plant located at Dora (near Baroda) in Gujarat. Export Markets: Australia. with Italian collaboration. South Africa. It has two plants.” Sources: http://www. Both plants are ISO 9001-2000 & 14001 certified. It was established with the objective to manufacture world class ceramic glazed floor and wall tiles for domestic and international markets.Bell ceramics Bell Ceramics was established in 1985. Sultanate of Oman. of Monoporossa Wall tiles & Floor tiles. Southern India. research and development. Bahrain.000 sq. comprising depots. Bangladesh. Manufacturing at plants is according to COMITEE EUROPEAN DE NORMALISATION (CEN).
comprising of over 40 models spanning the basic. Established in 1985. Its list of credits also includes a contract with France telecom for supplies of our products for their worldwide requirement as well as supplies to Telefonica. An in-house Centre for Excellence with industrial and engineering design capability and equipped with facility for product reliability and life tests ensures a quality standard that compares with the best internationally. feature-rich and cordless telephone categories. under the Beetel brand. The new initiatives of the company under the ‘Beetel’ brand include Broadband Products and Set Top Box – a hi-growth market in India. Both are focus areas for the company Manoj Banshilal Pachouri 49 ICFAI Business School . Bharti Teletech entered into a technical collaboration with Siemens AG. Bharti plans to double its exports in 05-06 over last year. Peru. Beetel commands a market share of over 40% in the retail market. the German technological giant and set up a plant in Ludhiana to manufacture telephones. Bharti Teletech has a tie-up with Atlinks (No. 95% in the PSP business and 60% in the tender market. including the PTT markets. In 1985. Bharti Teletech produces a comprehensive basket of customer premise equipments. The company has been in the forefront of growing the open retail market by providing feature-rich and world-class telephone products at affordable prices. Bharti Teletech currently exports to 30 countries in five continents.a Bharti enterprise.Bharti Teletech Bharti Teletech .1 in home and office telephony worldwide) for marketing of GE telephones in India and neighboring countries as well as exports. is India’s leading telephone instrument manufacturing company and one of the largest in the globe. the company’s manufacturing operations are spread across ISO-9000 certified plants in Mapusa (Goa) and Ludhiana (Punjab) with an installed capacity of 6 mn telephone units annually upgradable to 10 mn units.
bharti. came ISO 9001-2000 accreditations for the manufacturing units . Success came on both fronts and fast. Beetel became 'India's Favorite Phone'. Seamless mobility harnesses the power of technology convergence and enables smarter. Beetel manufactured phones for 'Sprint'. Shortly after.com/ http://www. anytime. Sources: http://www. the first to cross the 10 million unit mark and thereafter 20 million mark.In 1991. faster. anywhere. the only Indian telephone company to be present in 30 countries mapping 5 continents.motorola. Motorola had sales of US $31. Cornering a third of the Indian market.com/ Manoj Banshilal Pachouri 50 ICFAI Business School . the American telecom mammoth. And in a short span of time. In your home. in 1993-94. seamless mobility means you can reach the people. one of the largest telephone manufacturers across the globe. at Gurgaon and Ludhiana. embedded systems and wireless networks. The first telephone instrument to get ISO accreditations. Beetel was already the market leader. things and information you need. About Motorola Motorola is a Fortune 100 global communications leader that provides seamless mobility products and solutions across broadband.by this time two in numbers.3 billion in 2004. workplace and all spaces in between. auto. A brand present in every second Indian home. India's first EPBT phone. cost-effective and flexible communication.
chemicals. The revolutionary 100% polyurethane finishes are available in formulations for application to metal. abrasion. MRF Glasscoat: MRF Glasscoat is glass coating transparent. paper. The coatings have been developed for color and gloss retention. They guard against abrasion. In radial tyres. corrosion. that offers It is used Manoj Banshilal Pachouri 51 ICFAI Business School . extensively in the packaging industry. bus bodies. Tyres are basically of two types . In cross-ply tyres. grills and outdoor metal structures. bad weather and ultra-violet radiation and are virtually maintenance free. polyester. It is also extensively used in chemical plants.cross-ply and radial. PAINT & SPECIALITY COATINGS MRF Paints is division of MRF which deals in paint and specialty coatings. moisture and domestic spills. tread rubber and precured treads. nylon or rayon tyre cords are arranged diagonally across. MRF manufactures specialty coatings for wide range of applications. They are long lasting and have lower incidence of flats. strong adhesion and durability. textiles. tubes. ceramics and glass. metal furniture. wood. vinyl. metallic and frosted finishes. protecting it against the wearing effects of the weather. fiberglass or steel cords are arranged perpendicular to the circumference. opaque. Some of products from MRF Paints are: MRF Metalcoat: MRF Metalcoat is the ideal surface finish for any metal. MRF Woodcoat: MRF Woodcoat is a lasting surface finish for application on any kind of wood.MRF Ltd MRF manufactures automobile tyres. It is used extensively in to paint machinery. plastics. Radial technology is an improvement over cross ply and radial tyres are priced at (of 25-30%) premium. nylon. grills.
prevents MRF Autocoat: MRF Autocoat is a 100% polyurethane car finish that adds beauty and life to your car. glass. plastics. corrosion. A catalyst in vapor form accelerates the curing of paints and coatings and eliminates the need for temperature baking of industrial paint finishes. wood. thereby reducing the labor of frequent polishing. chemicals and ultraviolet radiation.MRF Vapocure: MRF Vapocure is used in surface coatings for wide range of applications of manufactured items such as metals. MRF Brasscoat: This clear coating for brass items tarnishing. Source: http://www. It offers high resistance to abrasion.com/ Manoj Banshilal Pachouri 52 ICFAI Business School .mrf. ceramics and paper.
PROCESS ANALYSIS Processes and Organization Manoj Banshilal Pachouri 53 ICFAI Business School .
handles more than twelve companies in various industries. I started interacting with Fairdeal’s staff. For instance. Internet. I also used to observe processes and activities to collect data. Fairdeal. Sources of Data Collection Primary Data: Primary data (or fresh data) was collected by me from Fairdeal’s staff and manager through person interaction. order taking. Business magazines. It was important to understand the working culture and environment of the company to understand its processes better. as a clearing & forwarding agent. I collected storing material information by tracking Titan watches in Titan store which are stored code wise. physical verification and many other processes myself. dispatch orders and scan barcode serial numbers of Motorola mobile sets in Bharti Teletech. Industry specific Journals. managers and store keepers. accept orders.Processes and the Organization This phase kicked off with understanding the processes of organization. To get a better insight of activities. Since different industries and different companies have their own rules and regulations of operations. Articles. order punching. ICFAI Business School’s study materials and from other variety of sources. Data for ABC Analysis was collected from companies’ individual ERP Modules and Inbound & Outbound Registers. I could punch data. Secondary Data: Secondary data (or published data) was collected from Company documents. Manoj Banshilal Pachouri 54 ICFAI Business School . I participated in Goods receiving. it was a challenge to study the processes of these companies by framing them in a common frame.
Organization Structure of Fairdeal Figure 3: Organization Structure of Fairdeal Manoj Banshilal Pachouri 55 ICFAI Business School .
loading/ unloading 3. Remuneration claimed by CFA There are three components of charges claimed by CFA: 1.I started with basic questions like ‘why warehousing and third party logistics for that reason is important at all’? Some of reasons that came forward in subsequent discussions are given below. 2. Variable charges E.: Labor charges. b. Fixed charges E.5 – 5 Rs per square feet) occupied by the company. Remuneration as service provider a. Fixed amount – Titan Volume or tonnage based Units per piece Manoj Banshilal Pachouri 56 ICFAI Business School . The reasons why a warehouse is required are: Have all the data in one place Easy storage Fast retrieval Simple to change information Security esp. freight.g. Rent based on square feet of area (4.: Hardware installation charges. c. Stationary. with multiple users Recovery from failures Advantages of a warehouse: Reduces redundancy Reduces inconsistency Sharing of data becomes possible Enables security restrictions Allows data independent applications.g.
146 660. Anal. storing. handling warranty claims. Carton is checked for any physical damage and pilferage. Komal Ooty. Dehradun.Company Wise Processes Fairdeal group is carrying out Supply Chain operations of more than twelve companies valued at Rs 3000 Crores.996. transporting. TITAN Watches Process Owner Website Store Incharge Computer operations Factory location Company Divisions Other Brands distributed Billing points Quantity handled Value Transactions No of dealers Mr. re-packing.InvDocPrn/ Mr. These operations consist of goods receiving. carton can be opened in presence of courier boy itself. cross-docking. Manoj Banshilal Pachouri 57 ICFAI Business School . reverse logistics etc.733 211 (Includes Tanishq. Ms. Sonata watches Tomy Hillfigure and Fastrack eyegear Ludhiyana. handling goods returns and unsalable material. Here is a brief overview of processes being carried out for each principal company handled by Fairdeal. Hemant http://trswamd/servlet/til.watches. Delhi and Bangalore 366. re-labeling. Fastrack and Hillfigure) Watches come from Ooty factory through courier services mainly Gati.trs. Goa. order accepting on behalf of principal. collecting cash. BlueDart and Unifreight.00 5. If weight doesn’t match. Sonata.350. Aashish Ms. weighted in the warehouse to check uniformity of cartons. pay sales tax and Octoroi etc. and Hosur Tanishq jewellery. stock maintenance. Noida. dispatching.
Carton contains packing slip containing number of pieces and codes. 999999xx99x or. Order Taking: Orders are taken by Titan salespersons or directly placed at Shiromani office by dealers and then bill comes to warehouse for dispatching watches directly to dealers. This packing slip is validated against Stock Transfer Memo in which number of pieces and price of each watch is given along with trade discount and sales tax. Last alphabet in titan watch might be K which shows that leather strap is brown. Alphabets may be: Y: Yellow (Gold Plated) N: Neutral G: Gold (18 caret) M: Metal S: Steel P: Plastic L: Leather B: Bi-Metal (Gold Plated and Steel) For example: 1233YM09K code of a particular watch means: 1233 is watch case code YM means watch is Yellow case (gold plated) and Metallic strap. 09 is code for dial type K means that the strap of the watch is brown. 9999xx99x or. Note: For paired watches case code is 6 or 8 digit number. Manoj Banshilal Pachouri 58 ICFAI Business School . Coding system of watches: 999xx99x or. 99999999xx99x Where 9 stands for a digit and x stands for an alphabet First set of digits is either 3 digits or 4 digits and denotes case code followed by two alphabets (First alphabet for case type and second for strap type) and then two digit dial code.
Table 4: Some examples of Titan watches Code 1348BM01 1044YM01 1184SL01 19262926YM02 Price INR (As on 21st Feb 2006) 5995/6750/6895/7500/- Storing Goods: Watches are stored in the warehouse in numeric order of Case Codes. Barcode reader may be useful to track watches in warehouse Billing can also be done through barcodes • • Manoj Banshilal Pachouri 59 ICFAI Business School . If new watches come in front. FIFO is violated. Billing and dispatching should be done at the same place. stacking is used in which new watches are placed behind old watches.Goods Receiving: Titan and sonata comes in 1800 models and variants. Purchasing Cycle in Titan: Salesperson goes to dealer Dealer fills order form to purchase watches Salesperson gives order form at Shiromani office Bill is raised at Shiromani office and dispatching order along with bill sent to warehouse Material dispatched from warehouse directly to dealers Recommendations for Titan: • Billing is done at city office and dispatching is done at warehouse which increases cycle time and wait time. For example watches with codes 1044YM01 would be placed in racks before watches with codes 1348BM01 To maintain FIFO.
bhartiteletech. Raman SDNet (Sales and Distribution Network) [http://www. Set Top Boxes Motorola mobile sets 146. Goa. Vinod Mr.888 211. J2EE. Manoj Banshilal Pachouri 60 ICFAI Business School . Sunil Patel Mr.743.611 9 Order taking: Dealer places order via phone/letter or punches it into SDNet. Inet crystal clear for reporting Beetel telephone instruments. Delhi and Bangalore http://www.jsp.538. Noida. order has to be punched into SDNet manually by warehouse personnel’s.Bharti Teletech Factory location (Billing points) Company website Process owner Computer operator Store keeper SD Module Languages and software Brands Other Brands distributed and sold Quantity handled Value Transactions No of dealers Ludhiyana.com Mr.29 1. dispatch order placed on SDNet (dispatched order may be partial dispatch or short close in case there is less stock) Enter PIN and IMEI number (for Motorola only) through scanner Print invoice and IMEI details (for Motorola only) FIFO: It was found that no particular method is followed in Bharti Teletech to ascertain FIFO.com:9080/ . Purchasing order cycle for Bharti: Dealer Punches order or Sales person collects orders from dealers Order accepted by Carrying and forwarding agent (warehouse) Accepted order verified by regional sales officer at Mumbai Once approved.beetel-india. If order placed via phone.
Manoj Banshilal Pachouri 61 ICFAI Business School .Recommendations for Bharti Teletech: All Motorola cases have to be brought to SDNet terminal to scan their IMEI numbers. For example: if one employee is absent or quits his job. It has been seen that some employees lack courtesy and communication skills. if not more. Employees should be motivated. in handling absent employees work. Training to operators: No formal training is given to SDNet operators. This consumes manpower as well as time in moving the cases. For example: uploading IMEI number using text files was there from beginning but operator at Fairdeal learnt it by trail and error only after one year of his tenure. encouraged and trained to behave courteously with channel partners (Example Area Sales officer and Logistic peoples like truck drivers etc) as well as dealers and Stockists. Multiple company handing: Employees should be encouraged to learn handling multiple (at least two) companies’ distribution channels like SAP of TATA Tea and SDNet of Bharti. This will ensure smooth operations even in case of absenteeism and job vacancies. New employees will learn better than those who have been working for a long time on single SD network. IMEI numbers can be scanned in Notepad in the beetel warehouse at the time of receiving mobile phone containers and then this text file can be sent to SDNet terminal for uploading IMEI numbers. Employees can be allotted to one company’s operations and one secondary companies working can be taught to him at the time of joining. there should be another employee in Fairdeal who is at least 80% efficient. They have learnt it by R&D and trail and error methods.
98 4. Delhi 58.NET application (E-application) 5. 2. local software without internet support). Pune.960.amararaja. Indore. Manoj Banshilal Pachouri 62 ICFAI Business School .900. Shabbir Amaron batteries Bhiwandi. RKM (old). Amara raja e-ARIMS (VB and crystal report. Amara raja E-application (http://localhost/bs/. integrated with . Ghaziabad. uses ASP. Bangalore.560 112.136 8 Jaipur.net and web services) 4. Warehouse terminal data is synchronized with company data via dial up virtual private network (VPN).com Mr. Pravin Mr. Software used: 1.Amara raja Batteries Factory location Corporate office Company website Process owner Computer operator Store keeper Brands Stock transfer from Quantity handled Value Transactions No of dealers Tirupati Chennai http://www. 3. Vinod Mr. BsApp Software.
Sai transport (from Bhiwandi) Goods Receiving: Once batteries arrives the warehouse. transporters handover packing slips to store Incharge which contain serial number of batteries. Manoj Banshilal Pachouri 63 ICFAI Business School . type of battery. Batteries are then physically checked for damage. Patel roadways (from Bhiwandi). Receiving Orders: Dealers place order at Premium House.Data Synchronization: Connect Internet connection Symantac Enterprise VPN client connects to company data for synchronization connect to VPN open BsApp press “synchronize data” button System uploads and downloads data to and from central server and number of records uploaded and downloaded is displayed. IBD: Industrial Battery Division IBDs are used for Invertors and UPS systems. approval from Mumbai is required. Cycle Count: Book stock and physical stock is validated daily morning. Shivraj Roadlines (from Pune). barcode and plastic wrapping before storing them in warehouse. For dispatching IBDs. After receiving material. upload receiving status on E-application and a mail is also sent to Chennai and Mumbai SCMs. Invoice cum delivery challan is raised by branch office. embossing. Movement of batteries is based on serial numbers basically.. prasanna cargo (from Pune). Transporters: Indo Arya Central Transport Ltd. 4 Volt cells are used for Idea and Hutch towers. TCI. Gandhigram branch office which is then forwarded to warehouse for dispatching via telephone. AS Transport.
Weekly stock report has to be made code wise which is taken from reports generated in BsApp. Hoardings. fly up stand etc. Free placement: < 12 months Prorata replacement: > 12 Months but less than 38 Months (Price decided based on chart) Regular: > 48 Months Amara raja warranty claim cycle: Service engineer checks battery and advance intimation Service engineer validates document and battery Battery comes to warehouse with delivery challan Advance intimation received after battery and delivery challan is received New battery with delivery challan sent to dealer (if stock available) [In case of free replacement and prorate replacement] Sign on Invoice and delivery challan received from dealers. caps. service engineer checks battery at dealer’s place and if satisfied. Batteries of previous lots are dispatched first. Manoj Banshilal Pachouri ICFAI Business School 64 . This method resembles Kanban Japanese practice.POP (Product of Promotions): Advertising material is also dispatched from warehouse against instructions from branch office. sends battery for replacement to C&FA. These reports are generated dealer wise which are then added separately code wise and punched into Excel sheet. Reverse Logistics: Delivery challan or warranty replacement (3 copies – yellow. Reporting: Weekly report is sent to branch office every Thursday. Labels are stuck to batteries of one lot containing receiving date and quantity with serial numbers. For FIFO: Batteries come in lots. T-shirts. green and white warranty sheets) are prepared out of which two copies are sent to customer (one of which comes back with signature) and one copy remains with Fairdeal. feature charts. Handling Warranty Claims: In case of warranty claim.
weight noted. Company has provided with a charger which can charge 32 batteries at one time.per kg. OEM battery is of white color Lead price is Rs 33/. Notes: • Battery must be charged every 40 days even in warehouse. (As in Feb 2006) Total Transaction: 6789 batteries sold in Jan 06 (Including prorata) • • • Recommendations for Amara Raja: • • Cordless scanner might be useful for scanning barcodes of batteries and in stock transfers also. Serial number is destroyed to avoid re-claims and a hole is made into battery. Serial number is noted. Manoj Banshilal Pachouri 65 ICFAI Business School .Handling Scrap Batteries: Scrap batteries (returned in free and prorata replacements) are stored in scrap warehouse. DD is then sent to Head Office in the name of Amara Raja. Indore who is All India contractor for purchasing battery scraps of Amara raja. permission taken from SCM and then handed over to Ganapati Metals. Cordless scanner would eliminate physical checking of serial numbers and then punching them into terminal.
Orders are then punched into data entry module of FAS. Bharat DOS based FAS (financial Accounting system) Snacks. Material comes from Ahmedabad factory in medium sized trucks. batch number.471.McFills Foods Factory location Company website Process owner Computer operator Store keeper Software used Products Quantity handled Value Transactions No of dealers Sharkhej.33 1233 129 Indent form is filled in . FIFO: stack card is labeled to boxes containing manufacturing date. Ahmedabad http://www. Hemant Thakkar Mr. Orders from dealers are obtained by phone (sales officer) or dealer in writing with DD.com Mr. Wafers.salable product like air-leaked packs. damaged packs. Bharat Mr. material with earlier manufacturing date is dispatched earlier. Material comes next day with Transporters LR (Lorry Receipt) and cash memo.003.mcfills. price code etc. Potato Chips 67.764 20.xls format and attached to email to McFills Company. Non. Stock transfer is not done in McFills division of Fairdeal till date. It is verified for pilferages and stored in warehouse. Manoj Banshilal Pachouri ICFAI Business School 66 . McFills are using 2500 sq ft of space in the warehouse (As in Feb 2006). This material is then sent back to McFills factory. bill is printed and material is dispatched by handing over material to transporter with printed bill. expired packs etc are brought back to warehouse along with written approval of sales officer and party’s letter containing material details from dealers after getting approval from sales manager.
This activity can be annulled. Quantity of unsalable material returned from dealers is very large compared to other companies.Recommendations for McFills: • Indent form preparing is responsibility of branch manager and not of CFA personnel. • • Manoj Banshilal Pachouri 67 ICFAI Business School . This is a bottleneck as a lot of time is consumed in maintaining non-moving and unsalable material. Though transaction volume is comparatively lower it is creating problems for customers as computer operator is not available when he is in store. Single person is handling computer operations as well as store for McFills.
Mr. It uses lotus notes. defreezer (for ice-creams. receipt is given to transporter and received details are punched into SAP module. material is unloaded.130. milk etc). Saurabh Mashruwala Mr.Voltas Factory location Company website Dadar. Amrit SAP R/3 Refrigerator. Mr. Targets are decided in MBRM (Monthly Business Review meeting of Voltas) held for area sales managers. Logistics Incharge Voltas. Receiving Goods: When truck comes to warehouse.9/ private website for mails and communication with C & FA and dealers. cassette evaporating unit Mini magic (made in China) 14. vesicular (Glassed door for storing cold drinks). water cooler (Mfg in Hyderabad) and mini magic water dispenser (made in china). Manoj Banshilal Pachouri 68 ICFAI Business School . Dharmesh is intimated. window and split AC.929 15 Process owner Computer operator F & C (Finance & Control) Incharge Store keeper Software used Products Spare parts Quantity handled Value Transactions No of dealers Mr.66 5. Khanpur Branch Ahmedabad gives orders to Head office. Address of Fairdeal is checked in documents.435 177. Hyderabad http://192.385. Dharmesh joshi. Saurabh Mashruwala Ms Shreedevi srinivasan Mr. Fairdeal comes to know only when goods come to warehouse.730.168.
VL 01 N: Create outbound delivery with order reference number Shipping point: 259 (for Fairdeal) Order number: from VA 03 Module GR/ GI Slip: vehicle number Bill of land: Collecting mode e. Schedule line Message tick is to be removed from SAP module only then outbound of material is permitted. orders not approved by local F&C go into ‘Escalated orders’] VA 03: Display Sales Order (displays sales order party name wise with dispatch address and order number) This order number is noted down manually into long book. Operating cordless scanner: VDS -> goods received -> scan barcode from Voltas products Mr. transporter etc Goto Goto Goto Header Header overview Loading options Number of packages Post Goods Issue (PGI) .g.SPT 1800 communication software (written in VB) is used for goods received and Barcode scanning. Select one number and click save button which will generate Invoice number. Voltas SAP Module: VL 10 C: Sales orders Items (for Pending orders and current orders punched by dealers) [Only orders approved by F&C are displayed in this module.outbound delivery number is generated in status bar which comes in VF 01 VF 01: Create billing document All outbound delivery numbers are displayed here. Cordless Barcode scanner is imported from Singapore. Manoj Banshilal Pachouri ICFAI Business School 69 . Dharmesh is intimated again so that he can punch orders of dealers into SAP module.
Quantity. where. After material is dispatched received receipt is collected back. VA 03 choose Environment changes execute [click watch icon] - Manoj Banshilal Pachouri 70 ICFAI Business School . To prints bills of specified invoice numbers.Inbound procedure: Transporter gives invoice to warehouse from which delivery number is putted in SAP module to get all details and all serial numbers. VF 31: To print Invoice Tick invoice lists and lists from [Inv no] to [Inv no]. Orders manually noted down in long book from VL 10C i. /N MIGO/ GR: Goods received outbound delivery /N: for switching transactions Delivery note: Invoice ID Bill of landing: LR (Lorry receipt) number Header text: transporter name Tab panes in page: Material.e. Outbound Process: Invoice or bill is given to transporter who dispatches the material. serial numbers Click check box named ‘Item OK’ and click post button. sales order items with order number. Message: Material document number 9999 posted is displayed To get time any order was approved: Follow the following procedure in SAP R/3 application to get the time when any order was approved.
There should be preplanned arrangement of labors and storing space to avoid wait time. Amul. Vadilal. Gokul have agreement with VOLTAS to supply their sticker putted products. Recommendations for Voltas: • Voltas trucks have to wait for unloading material in absence of required number of labors. Training for SAP module is given at Mumbai for 3 days.8 ton split ACs imported from china. Pepsi.6 ton window AC and 0. Inwards from Hyderabad have to be done using scanner as SAP is not implemented there.Notes: • • • • 0. Manoj Banshilal Pachouri 71 ICFAI Business School .6 & 0. Dadar material is not required to be scanned as delivery number can be used in SAP module to get all serial numbers.
Batteries. Hemant Mr. Mr.926 7 • • • • Material comes through courier/ Transport Material is stored at primary as well as secondary locations. Automobile spare parts 4.072. Bhavasar is notified MAN (Metropolitan Area Network) is being used to print pick slips by branch office at Fairdeal warehouse. gate pass are made in triplet.00 31. 1 copy with Fairdeal. Padali branch office.000. filters. Salim Mr. Overhauling kits.MICO Factory location Company website Process owner Computer operator Store Incharge Store keeper Software used Products Spare parts Quantity handled Value Transactions No of dealers Nashik.Rally for AS/ 400 Automobile spare parts.com Mr. Rajesh Mr. Pune. LR. Pramod IN4VANCFA .mico. • • • • Manoj Banshilal Pachouri 72 ICFAI Business School . Pick slip is then validated against IN4VANCFA software module (Menu 1. Chennai. Option 9) DC (Delivery Challan) is then printed by warehouse people. Spark plugs.625 531. Secundarabad. DC. Bangalore and Nepal http://www. Engine oils.918. 1 copy with MICO branch office and 1 copy with transporter are maintained.
FIFO: Colored codes with month number are labeled to bulk items. Computer operator has to wait for a long time after entering a command. Manoj Banshilal Pachouri 73 ICFAI Business School . It should be replaced with some advanced software like SAP R/3. Loose material (less quantity) Recommendations for MICO: Rally for AS/ 400 Software used in MICO is very old and due to lack of proper maintenance speed of system is very slow.
It is also checked for any physical damage or scratches. Mohan SAP R/3 TVS Victor. Store keeper then goes to warehouse and writes down serial numbers of ordered brands. Store keepers get confused between digits 8 & 3 and 0 & 8. bikes are stored in scrap warehouse. trucks are unloaded. TVS Star TVS bikes spare parts 46. TVS Pep. there are problems in noting down serial numbers. Orders are taken by branch office and conveyed to computer operator of Fairdeal via telephone.464. After verifying documents.82 2. At the time of unloading. Narendra Mr. Mitesh Shah Mr.in/ Mr. Trucks come to warehouse from factory location. Manoj Banshilal Pachouri 74 ICFAI Business School . bikes are checked for Key.057 34 Operations in TVS Motor are purely clearing & forwarding.532. Computer operator then validates it against SAP R/3 by entering order number. These numbers are used to prepare bill. Tamilnadu and Mysore http://www.668 1. Rearview mirror. TVS Centra. If scratches or damages are found. Tool box and other accessories. Battery.co.tvsmotor.980. Due to scratches on barcode labels or lack of proper lights. TVS Apache. After inspection bikes are stored brand wise and lorry number is noted down on the seats of bikes.TVS Motors Factory location Company website Process owner Computer operator Store keeper Software used Brands Spare parts Quantity handled Value Transactions No of dealers Hosur.
TVS should ask SAP R/3 to provide them with integrating software which can transfer data to and from cordless barcode scanner and SAP R/3 module. Transporters should be encouraged to intimate Fairdeal in advance about their arrival. At present bikes received first are dispatched first but this rule is not followed strictly. one for SAP R/3 operations and other for assistant works. Physical stock sometimes does not tally with book value.FIFO: Manufacturing weak number is present on number plate of bikes with Engine numbers and frame numbers.e. In case of cross-dispatching. Recommendations to TVS: • TVS division has two computers. This error occurs due to labor picking wrong bikes or error in noting down serial numbers. This will help Fairdeal in arranging for bikes space and avoid parallel unloading. data has to be transferred using Floppy disks from one machine to another. This will reduce human errors as well as increase efficiency of receiving and dispatching also. As of now. i. These computers should be connected to each other through network connection. Cordless barcode scanner can be used to scan serial numbers instead of doing it manually. • • • Manoj Banshilal Pachouri 75 ICFAI Business School . Notes: • • • 5000 bikes dispatched per month all over Gujarat. Bill has to be made in Excel sheet. bikes billed for one dealer are dispatched to other dealers. Some times there is error of Cross-Dispatching.
or less. damage is claimed from transporter. At present. invoice is printed and material is dispatched with gate pass and LR copies. no order will be made. Hemant Thakkar MFG Pro wall and floor tiles 250. Hoskote near http//www. Wall tiles are manufactured at Dora and Hoskote plant manufactures floor tiles only.Bell Ceramics Factory location Company website Branch Manager Dora near Bangalore Baroda. dealers have to keep pre-signed cheques with depot.843. Manoj Banshilal Pachouri 76 ICFAI Business School . If cheques are present. Data in MFG Pro software is uploaded by emailing Microsoft Excel (. Tiles are checked for physical damages and If damages are up to Rs 4000/.bellceramics. Order is taken on phone by Fairdeal.426.xls) sheets. 300X300 mm. If cheques of dealer are not present.127.464 100 Bell ceramics has tiles in 200X300 mm.96 4.93 47. 397X397 mm and 400X400 mm categories. Ramesh Desai [Ahmedabad@bellceramic. Hemant Thakkar Mr. else it is claimed from insurance company.com/ Mr.com] Process owner Computer operator Software used Products Quantity handled (Sq mts) Value (INR) Transactions No of dealers Mr.
Further. Recommendations for Bell Ceramics: All orders in bell ceramics are placed either via telephone or written order is sent to depot. Manoj Banshilal Pachouri 77 ICFAI Business School . Fairdeal should negotiate with Bell management to provide them with better infrastructure to operate its activities better.Notes: • Tile Shades vary every batch. This increases Fairdeal’s work as orders have to be punched manually by Fairdeal staff. this company does not have any branch office in Gujarat and Area Sales Manager Mr. Ramesh Desai works from Fairdeal premises itself. There is at least 2% to 3% variation in shade for every batch change.
3 8. Aashish Mr.93 2. MRF Paints Factory location Head Office Branch Manager Process owner Computer operator Software used Products Quantity handled Value (INR) Transactions No of dealers Chennai Mumbai Mr.000 10.072. Maniyar Mr. Aashish Noida 502. Himanshu P. Tushar MS Dos based InvMenu.605 65 Manoj Banshilal Pachouri 78 ICFAI Business School . IMS and Bill Printing Paint products and speciality coatings 33.IM Technologies Process Owner Store Incharge Factory location Quantity handled Value (INR) Transactions No of dealers Mr.599. Vinod Mr.368. Carton is checked at time of receiving and stored at ground floor itself from where it is dispatched to Idea Cellular.396.500.00 19 1 SIM cards come from Noida (imported from abroad) through courier. Gandhinagar.
Its softwares are almost obsolete and many of its modules are either out of date or not upgraded. Manoj Banshilal Pachouri 79 ICFAI Business School .Notes: RCB Menu: Software for taking payment from party SRCN: Expired material coming back to depot IBTA: Stock transfer (Inter depot) DSO: Direct Sales Order IMS: Inventory Management System Recommendations to MRF: • MRF paint is using very primitive softwares and need immediate attention towards this field.
driver’s name. loading or unloading. of the project. Truck daily register records vehicle number. Party name (transporter or dealer’s name). Inward and outward registers are maintained company wise and day wise also. Fairdeal has eight security guards. Out time. In time. Godown keeper and truck driver and signed by all three also. ABC Analysis and AS-IS Analysis phases. Ram Prakash Singh Kushwah • • Material is loaded in presence of security guard. security guard’s sign At Main warehouse. Ltd Process Owner: Mr.Security at Fairdeal Distribution Services Pvt. • • • • These company wise processes study in this phase will make the basis for further research in next phases. Gate pass is checked for quantity (short or excess both) and validated against physical goods at the time of dispatching at main gate. Manoj Banshilal Pachouri 80 ICFAI Business School . Staffs register tracks In and Out time of employees.
ABC ANALYSIS Value Wise and Quantity Wise Manoj Banshilal Pachouri 81 ICFAI Business School .
freight claim registers etc. inbound registers. outbound registers. invoices. operations of all client companies have to be categorized in A. ABC Analysis for client companies would be done value wise and quantity wise to get a better picture of companies’ operations as a company which constitutes major part in terms of value might be dealing in precious items like jewellery but it might not have large volume. This is most valuable category and most attention should be given to this category. With this information. Manoj Banshilal Pachouri 82 ICFAI Business School . items are classified into three categories which are as follows: Category A: This category consists of 10% of items by Units of Measure (UOM) i. B or C groups to get the information about which companies constitute the major part in Fairdeal’s turnover.Definition of ABC Analysis ABC Analysis: ABC Analysis is an inventory management tool based on the tenets of Pareto Analysis.e. This category items are less profitable than category A items but more profitable than category C items. Data Collection Data for all companies was collected either from their ERP applications or I had to search the data from reimbursement registers. This is least valuable category and least profitable as well. It categorizes inventory by its highest value and greatest volume. In this phase. quantity and 70% by value. Category C: This category consists of 70% of items by Units of Measure (UOM) and 10% by value. like Rally for AS/400 in MICO. did not have any modules for sales figures in which case help of management was taken to provide the relevant data. Some software packages. inventory managers can focus on increasing those inventory SKUs with the greatest potential positive return for the organization. In this analysis. Category B: This category consists of 20% of items by Units of Measure (UOM) and 20% by value.
498.84 777.279.70 8.980.114.556.07 533.78 LANTERN GAS TABLE Manoj Banshilal Pachouri 83 ICFAI Business School .141.489.350.182.599.00 69.48 613.Value Wise ABC Analysis Note: All values are in INR (Indian Rupees) MRF Data Value Apr-05 May-05 Jun-05 Jul-05 Aug-05 Sep-05 Oct-05 Nov-05 Dec-05 Jan-06 Feb-06 Mar-06 Total 534.11 614.70 978.78 217.017.710.227.632.01 730.00 16.363.394.93 TVS Motor Data TVS Motors Value (INR) Total 1.799.00 0.597.82 BPL Techno Vision Data BPL Sanyo AUDIO Product DVD 124A PICNIC SANGEETH A3 SPORTY RLF 650 RED RLF 750 BLUE RLT 210 D YELLOW 7100 P (SS) 7300 P (SS) TOTAL Value 575.532.082.04 707.40 734.098.262.249.640.00 2.41 725.464.00 1.29 628.00 35.88 791.00 10.368.127.00 91.
102.00 Sonata 118.752.00 Tata Tea Data Tata Tea Value (INR) Total 32.076.996.33 IM Technology Data IM Technology Value (INR) Total 10.98 Manoj Banshilal Pachouri 84 ICFAI Business School .00 Tommy Hilfiger 9.072.00 TANISHQ 248.003.264.003.220.687.500.789.31 Bell Ceramics Data Bell Ceramics Value (INR) Total 47.00 TOTAL 248.350.00 Gold Plain UCP Jewellery 4.00 Gold Studded 66.719.780.492.624.863.00 SOLITAIRE 150.286.789.000.00 Amara Raja Data Amara Raja Value (INR) Total 112.00 TOTAL 660.073.900.214.127.471.00 Value (INR) Value (INR) PLAIN JEWELLERY WITH STONES 29.96 McFills Data McFills Value (INR) Total 20.220.653.056.00 Fastrack Sunglass 12.00 Silver Coins 578.446.960.850.727.932.00 Silver 259.00 Tanishq Jewellery Data Gold Plain 119.485.800.843.00 Platinum 241.365.00 Gold Coins 27.Titan Industries Data Titan Value (INR) 271.
33 10.538.31 20.003.960.66 Annual sales for the financial year 2005-06 for Gujarat state were tabulated in descending order of their turnovers as follows: Companies in descending order of turnovers Company TVS Motor Titan MICO Bharti Voltas Amara Raja Bell Tata Tea McFills IM Tech MRF Paints BPL Sanyo Value (INR) 1.072.00 8.730.500.00 211.286.980.127.743.599.843.471.93 1.850.96 32.385.350.000.072.730.29 177.385.538.072.464.00 531.66 112.597.00 Bharti Teletech Data Bharti Teletech Value (INR) Total 211.743.82 660.996.017.368.29 Voltas Data Voltas Value (INR) Total 177.98 47.MICO Data MICO Value (INR) Total 531.900.000.532.78 Manoj Banshilal Pachouri 85 ICFAI Business School .
03% 100. C Category It is evident from table that contribution of TVS motor is largest with 44.072. Manoj Banshilal Pachouri 86 ICFAI Business School .532.368.98 47.500.900.45% 5.49% 92. Cumulative percentage < 70% => A Category Else if.41% 3.127.597.00 8.41% 99. cumulative percentage is calculated for companies sorted in descending order of values.78% 98.69% 64.69% 20.05 % of total value 44.996.78% 99.730.00 211.960.03% 87.44% 1.843.980.743.34% 97.385.00% Category A A B B C C C C C C C C Total of all values was calculated which was used to calculate percentage of total value contributed by each company as follows: Percentage of total value = Turnover of company ---------------------------------Total turnover of companies After this.000.Value Wise Company TVS Motor Titan MICO Bharti Voltas Amara Raja Bell Tata Tea McFills IM Tech MRF Paints BPL Sanyo TOTAL Value (INR) 1.350.850.278.97% 100.599.31% 0.93 1.286.33 10.072.017.00% Cumulative % 44. B and C categories using formula.14% 16. Cumulative percentage > 70% but < 90% => B Category Else.90% 96.538.69% and that of BPL Sanyo is least with 0.20% 6.29 177.471.78 3.31 20.003.Table 5: ABC Analysis . If.62% 0.71% 99.82 660. These cumulative percentages are used to categorize companies in A.196.03%.735.83% 81.26% 0.96 32.66 112.00 531.464.45% 1.00% 0.
3 TVS Motor Data TVS Motors Quantity Total (bikes) 46668 BPL Techno Vision Data BPL Sanyo AUDIO Product DVD 124A PICNIC SANGEETH A3 SPORTY LANTERN RLF 650 RED RLF 750 BLUE RLT 210 D YELLOW GAS TABLE 7100 P (SS) 7300 P (SS) TOTAL Quantity (pcs) 189 60 110 24 230 10 10 11 0 644 Manoj Banshilal Pachouri 87 ICFAI Business School .75 732 611 1183.8 737.5 790.4 1181.8 747.8 1206.25 506 318 343 416 1400.5 33396.25 Qty 2 614 456.5 1167.5 875 813.Quantity Wise ABC Analysis MRF Data in Litres Qty 1 Apr-05 May-05 Jun-05 Jul-05 Aug-05 Sep-05 Oct-05 Nov-05 Dec-05 Jan-06 Feb-06 Mar-06 Total 503.5 703 589.5 1513 1485 1010.5 613.7 918.75 1735 1600 847.3 935 1531.2 1367.5 1218.5 360 Qty 3 1218.8 1145.
635 Gold Coins 4.560 Manoj Banshilal Pachouri 88 ICFAI Business School .440 TOTAL 366.440 Tata Tea Data Tata Tea Quantity (Kg) Total 277.000 Amara Raja Data Amara Raja Quantity (pcs) Total 58.851 Fastrack Sunglass 11.340.790 Gold Studded 4.426.55 Bell Ceramics Data Bell Ceramics Quantity (sq mts) Total 250.93 McFills Data McFills Quantity (boxes) Total 67.Titan Industries Data Titan Quantity (pcs) 155.016 Gold Plain UCP Jewellery 995 SOLITAIRE 19 TOTAL 26.153 Sonata 171.234 Platinum 17 Quantity (pcs) Quantity (pcs) PLAIN JEWELLERY WITH STONES 1.764 IM Technology Data IM Technology Quantity (pcs) Total 502.146 Tanishq Jewellery Data Gold Plain 10.650 Silver 84 Silver Coins 4.644 TANISHQ 26.058 Tommy Hilfiger 1.
625 502.427 146.435 Total quantities dispatched for the financial year 2005-06 for Gujarat state were tabulated in descending order of their quantities as follows: Companies in descending order of quantities Company MICO (pcs) IM Tech (cards) Titan (pcs) Tata Tea (kg) Bell (sq. mts) Bharti (pcs) McFills (boxes) Amara Raja TVS Motor (bikes) MRF Paints (ltr) Voltas (pcs) BPL Sanyo (pcs) Quantity 4.625 Bharti Teletech Data Bharti Teletech Quantity (pcs) Total 146.146 277.341 250.435 644 Manoj Banshilal Pachouri 89 ICFAI Business School .MICO Data MICO Quantity (pcs) Total 4.560 46.888 Voltas Data Voltas Quantity (pcs) Total 14.918.668 33.764 58.918.000 366.396 14.888 67.
15% 3.01%.668 33.146 277.99% 100.888 67.Quantity Wise Company MICO (pcs) IM Tech (cards) Titan (pcs) Tata Tea (kg) Bell (sq.58% 99.11% 86.50% 0.20% 1. Manoj Banshilal Pachouri 90 ICFAI Business School .01% 100.894 % of total Quantity 73.49% 96.00% Category A B B B C C C C C C C C Method for categorizing companies in A.77% 99.427 146.625 502.22% 0. mts) Bharti (pcs) McFills (boxes) Amara Raja TVS Motor (bikes) MRF Paints (ltr) Voltas (pcs) BPL Sanyo (pcs) TOTAL Quantity 4.01% 0.396 14. It is evident from table that contribution of MICO is largest with 73.00% Cumulative % 73.682.Table 6: ABC Analysis .27% 99.560 46.435 644 6.51% 5.75% 2.918.59% 90.60% 7.74% 94.88% 0.69% 97.6% and that of BPL Sanyo is least with 0.48% 4.70% 98.000 366.70% 0. B and C categories is same as that used in aforesaid value wise ABC Analysis.764 58.341 250.60% 81.
057 BPL Techno Vision Data BPL Sanyo AUDIO Product DVD 124A PICNIC SANGEETH A3 SPORTY LANTERN RLF 650 RED RLF 750 BLUE RLT 210 D YELLOW GAS TABLE 7100 P (SS) 7300 P (SS) TOTAL Transactions 22 8 14 3 9 1 1 1 0 59 Manoj Banshilal Pachouri 91 ICFAI Business School .Transactions Wise ABC Analysis MRF Data Transactions Apr-05 May-05 Jun-05 Jul-05 Aug-05 Sep-05 Oct-05 Nov-05 Dec-05 Jan-06 Feb-06 Mar-06 Total 228 241 215 231 222 268 192 224 193 239 185 167 2605 TVS Motor Data TVS Motors Transactions (No) Total 2.
764 IM Technology Data IM Technology Transactions (No) Total 19 Amara Raja Data Amara Raja Transactions (No) Total 4.Titan Industries Data Titan Transactions 2.733 Tanishq Jewellery Data Gold Plain Transactions 335 Gold Studded 323 Gold Coins 159 Silver 9 Silver Coins 11 Platinum 13 Transactions PLAIN JEWELLERY WITH STONES 199 Gold Plain UCP Jewellery 128 SOLITAIRE TOTAL 6 1.806 Bell Ceramics Data Bell Ceramics Transactions (No) Total 4464 McFills Data McFills Transactions (No) Total 67.103 Fastrack Sunglass 357 Tommy Hilfiger 206 TANISHQ 1.183 TOTAL 5.136 Manoj Banshilal Pachouri 92 ICFAI Business School .183 Tata Tea Data Tata Tea Transactions (No) Total 1.884 Sonata 1.
611 1.233 59 19 Manoj Banshilal Pachouri 93 ICFAI Business School .926 Bharti Teletech Data Bharti Teletech Transactions (No) Total 1611 Voltas Data Voltas Transactions (No) Total 5.605 2.464 4.929 5.057 1.136 2.733 4.926 5.MICO Data MICO Transactions (No) Total 31.929 Total transactions done by company to dispatch aforesaid quantity for the financial year 2005-06 for Gujarat state were tabulated in descending order of their transactions as follows: Companies in descending order of transactions Company MICO Voltas Titan Bell Amara Raja MRF Paints TVS Motor Tata Tea Bharti McFills BPL Sanyo IM Tech Transactions 31.806 1.
32% 95.98% 92.34% 2.62% 2.605 2.85% 9.136 2.47% 70.85% and that of IM Technology is least with 0.87% 99. Manoj Banshilal Pachouri 94 ICFAI Business School . It is evident from table that contribution of MICO is largest with 51.233 59 19 61.Transaction Wise Company MICO Voltas Titan Bell Amara Raja MRF Paints TVS Motor Tata Tea Bharti McFills BPL Sanyo IM Tech TOTAL No of Transactions 31.75% 88.464 4.23% 3.057 1.611 1.93% 2.03%.25% 6.03% 100.00% Cumulative % 51.10% 0.25% 97.578 % of total Transactions 51.63% 9.72% 4.Table 7: ABC Analysis .00% 0.87% 99.733 4.929 5.79% 78.926 5.31% 7.03% 84.85% 61.00% Category A A A B B B C C C C C C Method for categorizing companies in A.806 1.97% 100. B and C categories is same as that used in aforesaid value wise ABC Analysis.
AS-IS ANALYSIS Process Matrices Manoj Banshilal Pachouri 95 ICFAI Business School .
my next objective was to measure all the important processes. Update stock register Manoj Banshilal Pachouri 96 ICFAI Business School . This phase of project report summarizes the notes. Make shortage-claim or Damages-claim 7. Update goods in transit and current stock modules 13. Intimate shortage claim or damages claim to branch office 8. Store material according to companies stacking norms 12.Definition of AS-IS Analysis As-Is Analysis phase of BPR is aimed specifically at identifying disconnects within existing business processes and their specified intent. Receiving Goods 3. Bharat Kantharia (Faculty Guide).g. For this. flowcharting and TO-BE Analysis section. Give acknowledgement to transporter 4. Sharad Jobanputra (Company Guide) and Mr. Ltd. The material was collected. Scan barcode serial numbers 6.. Unload inbound material 9. My Mechanism: After understanding the workings and processes of Fairdeal during Organization and Processes phase. facts and findings of the current business processes at Fairdeal Distribution Services Pvt. all the relevant documents are gathered and all the processes and sub-processes studies in previous phase are listed out which are: 1. inconsistency between the functions of a process that cause failings of the existing process to achieve its intent) Steps taken to describe the AS-IS process also includes documentation of the sequence in which activities are performed. Verify goods against Goods In Transit 2. and presented by me to Mr. analyzed. Disconnects mean anything that prevents the process from achieving desired results (e. This section is intended to serve as input to the process mapping. Arrange for bitumen sheets or pallets 11. Physical inspection of inbound material 5. Segregate material in brands and shades 10.
Receive warranty returns 38. Generate weekly and monthly reports 41. Stock Maintenance 19. Dispatch goods 33. Verify ordered quantity against invoice 31. Print invoice 29. Make pending orders 27. Receive orders from customers 20. Intimate principal about scrap material 40. Pay Octoroi if applicable 36. Prepare Gate pass 30. Load material on vehicle 32. Check availability of customer’s checks with Fairdeal 25. Receive stock transfer requests 21. Receive ‘goods received’ acknowledgement from customers 35. Receive unsalable material 37. if required 17. Claim transport charges from company Manoj Banshilal Pachouri 97 ICFAI Business School . Collect cheques from customers 23. Intimate customers about insufficient cash 26. Check stock in warehouse after dispatching 34. Place stack cards on goods 16. Make stack cards 15. Claim Octoroi claims from company 42. Punch orders 22. Re-labeling of goods 18. Check availability of ordered goods 24. Intimate principal about warranty claims 39. Short close orders in case of shortage of goods 28.14. Re-pack material.
process owners. 3. 6. Manoj Banshilal Pachouri 98 ICFAI Business School . Process Matrix contains activities that are undertaken in every process. managers. 8. store keepers. eleven most vital procedures were shortlisted as main processes for further analysis and remaining out of 42 were classified as sub-processes of these main processes. 7.All the processes and sub-processes mentioned here are not under control of Fairdeal. Goods Receiving Storing Material Cycle Count Order Punching Order Approval Invoice/ Bill Printing/ Stock Transfer Dispatching Transportation Handling Unsalable Material 10. clerks. and directors of Fairdeal. The main processes are: 1. Some processes are initiated outside Fairdeal and some are partially or fully controlled by outside sources like dealers and branch offices. 4. All the process matrices are shown graphically also which are drawn using Microsoft Visio 2003. 9. All activities might not be followed in the process and some activities are alternate activities. Handling Warranty Claims 11. This phase also includes main issues with related priorities and excerpts from interview of warehouse labours. These processes were then again studied and process matrices were prepared for each process. security guards. Ltd. 5. Those Processes which are specific to a particular company are indicated by company name in the parentheses. Out of these procedures and sub-procedures. Stock Maintenance These processes are general processes common to all companies handled by Fairdeal Distribution Services Pvt. 2.
but specific improvements are possible. the issues were elsewhere (e.Decide on an approach Analysis of every process and its activity steps will decide the future of the process. Manoj Banshilal Pachouri 99 ICFAI Business School . i. • Leave as is: The process is fine. this has been the choice for generic. whether it will be redesigned or leaved as it.e. • Improve: The basic structure of the process is okay.g. There are five possible courses of action: • Drop/abandon: This process is not necessary. • Redesign: The process should be fully redesigned.. infrastructure activities such as cleaning and catering. or training is needed). • Outsource: It would be a more effective use of resources to have a supplier carry out the process. no one follows the process. or the benefit will never justify the cost. Traditionally.
Following are the in and out times of some of the companies whose material come through transport vehicles. and Working time of various processes. difference etc. Wait Time measurements To measure Wait time. In and out time of trucks were noted down. Table 8: Unloading times of Transport Vehicles IN Beetel 13:30 12:20 16:30 12:30 11:45 13:00 12:15 13:50 11:45 Voltas 18:30 17:00 15:00 16:15 15:15 11:15 21:15 10:45 12:45 14:15 13:00 OUT 14:30 13:15 17:00 13:45 12:15 13:30 12:45 14:20 12:15 19:10 18:15 16:45 17:00 16:45 13:00 22:00 12:15 13:45 15:30 14:00 Tata Tea 10:25 13:45 12:45 16:45 McFills 16:30 17:15 17:45 18:45 Bell 10:30 10:00 10:00 10:45 11:10 11:45 14:00 15:00 13:45 12:15 15:20 12:15 ARBL IN 10:25 10:00 10:00 8:15 10:00 18:00 OUT 12:45 13:30 10:45 13:30 12:00 19:30 Manoj Banshilal Pachouri 100 ICFAI Business School . Cycle time. Work time and other measures. These times would be compared with industry’s ideal loading and unloading times to measure Cycle time. Note: These tables are drawn in Excel sheets and imported to word document after doing all calculations like Average.Cycle Time. Wait time.
56 Bikes) IN OUT Loading Time (Hrs) Unloading Time 10:15 14:24 15:15 12:00 13:30 14:20 16:45 18:20 18:30 18:45 12:30 18:00 18:45 13:45 16:35 17:45 18:30 14:40 16:35 18:00 18:20 18:55 13:00 16:15 17:00 13:10 14:15 16:30 18:15 19:30 19:45 19:00 14:00 20:00 20:00 14:45 18:00 18:30 19:45 16:50 18:05 19:10 19:25 19:10 10:35 12:10 13:10 15:30 7:50 10:30 15:45 15:30 10:00 11:20 11:30 12:50 14:45 16:00 16:30 10:45 11:30 10:00 10:30 18:10 10:00 11:10 12:05 13:05 15:10 17:15 8:50 12:15 15:00 18:00 11:10 12:55 12:45 14:15 16:00 17:45 18:00 12:00 13:30 11:00 11:40 19:20 11:00 13:30 Avg. Time 2:45 1:51 1:45 1:10 0:45 2:10 1:30 1:10 1:15 0:15 1:30 2:00 1:15 1:00 1:25 0:45 1:15 2:10 1:30 1:10 1:05 0:15 1:21 1:30 0:55 2:00 1:45 1:00 1:45 1:15 2:30 1:10 1:35 1:15 1:25 1:15 1:45 1:30 1:15 2:00 1:00 1:10 1:10 1:00 2:20 1:28 Table 10: Ideal Unloading times (with four labors) Industry Automobile (TVS) Food & Snacks (McFills) Batteries (Amara Raja) Home appliances (Voltas) Telecommunications (Bharti) Tiles (Bell Ceramics) Ideal Unloading Times 1 hour 30 Min 2 hours (Due to security check for acids) 1 hours 30 minutes 2 hours Manoj Banshilal Pachouri 101 ICFAI Business School .Table 9: Loading & Unloading times in TVS (With four labors) TVS Motors Loading (20 .26 Bikes) IN OUT Unloading (50 .
Lack of sufficient labours 3.04 hours It is clearly visible from above tables that Cycle time and Wait time of Fairdeal’s unloading activities are far more than ideal industry measures.13 hours 41 minutes 3.28 hours 1.22 Min 2. Lack of space to unload material 2. Delay in issuing material received acknowledgement Moving and Non-moving materials Average cycle time of processes can not be calculated because almost all companies have fast moving.Table 11: Fairdeal’s Unloading times Industry Automobile (TVS) Food & Snacks (McFills) Batteries (Amara Raja) Home appliances (Voltas) Telecommunications (Bharti) Tiles (Bell Ceramics) Fairdeal’s Average Unloading Times 1. Cycle times of individual products or brands only can be calculated which is out of scope of this project. Some of the reasons for deviations in these measures are as follows: 1.33 hours 1. slow moving and non-moving goods categories. Physical inspection of material 5. I would calculate Cycle times of individual products if time permits after completion of this project. Security checks at gate 4. Manoj Banshilal Pachouri 102 ICFAI Business School .
give a feel for the dynamics of the process before diving into the assessment. Metrics provide useful guidance to focus efforts and requirements.Process Matrices [Key Performance Indicators (KPIs)] Metrics. or key performance indicators (KPIs). Table 12: Summary of Metrics Summary of Metrics Executing Time Cycle time Work time Time worked Queue time Idle time Waiting Time Idle Transit Queue Setup Involvement People Departments Dealers Stockists Labor Locations Languages Branch Office Transporters Efficiency Attritions Rework Training Errors Iterations Delay Complaints Cost Unloading costs Loading costs Storing costs Maintenance costs Re-packing costs Octoroi charges VAT charges Damage costs Transportation costs Manoj Banshilal Pachouri 103 ICFAI Business School .
Physical inspection of inbound material To enforce security at a warehouse. rather than for general stock and also for goods which will be issued directly to users without being entered into normal stock records and which are received only occasionally (as in IM Technology case where goods are directly dispatched to Idea Cellular). Any damage or shortage has to be mentioned in the document. Manoj Banshilal Pachouri 104 ICFAI Business School . They can also be specially printed on labels by a dot matrix. This applies to both suppliers' and the warehouse's own vehicles. This Gate Officer is responsible for: • Completing meticulous records about vehicles entering or leaving the warehouse area. Some of the main activities in this process are: Verify goods against Goods in Transit Goods are checked to see that they comply with the specifications laid down in the order form.Goods Receiving Process Goods Receiving process is initiated by either transporter or courier service provider when material is brought to Fairdeal warehouse. Drivers employed by external suppliers are supervised all the time they are inside the warehouse security area. Scan barcode serial numbers A Bar code is a series of wide and narrow bands and spaces which represent numbers and letters. These bar codes. vehicles to ensure they contain no • • Give acknowledgement to transporter Acknowledgement of goods received is given to transporter either by signing on copy of LR or by issuing a separate document. In the record is each vehicle's registration number. can be printed on package labels or cases. Searching departing unauthorized load. details of the delivery note. ink-jet or full character impact printer. the name of the supplier and the times of arrival and departure. like POP or promotional goods. This process ends with accepting the material for storing it into warehouse. in machine-readable format. Giving all drivers clear directions. This is particularly important for goods which have been ordered for a specific purpose. a duty officer mans a Gate Office.
it is notified to the supplier straight away. Supply Chain Manager (SCM) and transporter. This is the responsibility of the Store Incharge to sign for the receipt of the consignment. Manoj Banshilal Pachouri 105 ICFAI Business School . In TVS motors. the contents are checked carefully. He can then make a claim against the carrier. Make shortage-claim or Damages-claim If some items are found to be missing or damaged. Once the loss or damage has been verified. adjusting records of stock levels automatically.The codes are read by a light pen or a fixed-beam reader scanner. The transporter's representative then countersigns the endorsement. or other parties. he has been instructed to qualify his signature on the delivery note by writing a comment. Generally two to four labors are used to off-load material in Fairdeal. Intimate shortage claim or damages claim to branch office If the full complement of items ordered is not received (shortage) or if goods arrive damaged. Storage claim or damages claim are intimated to Area Sales Manager (ASM). material is scanned (if applicable as in Voltas) for barcode serial numbers and off-loaded from the lorry. the first thing done is to segregate the defective unit or packages. compensation has to be claimed from the insurance company according to company norms. Unload inbound material After inspection of material is complete. The Depot Incharge may choose to send the goods back. The readers are interpreted by a micro-processor decoder. Where packages are obviously damaged on the outside. tool kit etc at the time of off-loading. They are linked to a computer which updates the inventory control data base. accessories. Bikes are checked for battery. Alternatively. Decoders are used to record and identify goods received and goods issued.
In case of physical damage or short supply: • Supply Chain Manger is informed.277 pieces per day (300 working days) Material status from Goods in transit Module Invoice cum delivery challan. 1. LR receipt Material received notified to branch office through mail Material received receipt given to transporter Monthly report generated Current Inventory Status Current stock in warehouse STM should match goods in transit Manoj Banshilal Pachouri 106 ICFAI Business School .5 Material unloaded from Lorry.4. [Amara raja batteries] Responsibility People Involved Location Frequency Input Output Reports Dataflow Documents Dataflow Documents Statutory MIS Existing Integrations Controls Godown Keeper 6 Persons Warehouse 22.6 E. 1.2 Area branch office is notified about arrival of material.8 Serial numbers are scanned using cordless barcode scanner. [Voltas] STM is received from transporter or courier person containing GRN and 1.10 Material is stored in warehouse.1 against printed weight on carton. rear view mirror and battery is attached with bike. In case of courier service. Material is manually inspected for any physical damage and accessories 1. SDNet.4. • Damage claim or Shortage claim is prepared.11 Upload receiving status on applications like SAP R/3. [Titan watches] If weight of carton does not match with printed weight.12 Mail is sent to Supply Chain Managers. [Titan watches] Docket wise Cartons are opened and watches are checked with packing 1.7 • Local ASO (Area Sales Officer) is informed. TVS bikes are checked for whether key and tool kit is with bike or not.1 Transfers.2 opened before courier person.3 outbound number. Carton will be 1. MFG Pro 1.4. 1. [Voltas] 1.9 Goods received acknowledgement given to logistics person.Table 13: Goods Receiving Process Process 1 Goods Receiving Goods arrive from factory locations or other locations in case of StockActivities 1. 1.3 slips which are inside the carton. Individual carton is weighed and verified 1. 1.g. [Titan watches] 1.
Figure 4: Flowchart of Goods Receiving Process Manoj Banshilal Pachouri 107 ICFAI Business School .
They are also marked with any information about restriction of issue. This ensures tracking of material on daily basis.Storing Material Process This process is initiated by goods receiving process and ends with storing material into scrap warehouse or finished goods warehouse. Goods in transit module is updated and material in goods in transit module then shifts to current stock with CFA module. Update stock register Physical stock register is updated once material is received or dispatched from the warehouse. Update goods in transit and current stock modules After goods are received. All pallet loads are properly strapped. Manoj Banshilal Pachouri 108 ICFAI Business School . Bell ceramics tiles are stacked batch wise and shade wise. Batteries in Amara Raja are stored on pallets according to batch to ensure FIFO. Stock register is helpful at the time of order punching when it is verified for stock availability. banded and fastened to the pallet according to the type of product. Arrange for bitumen sheets or pallets Pallet loads are first checked to see that they are secure. Some of the main activities in this process are: Segregate material in brands and shades Packages or individual items are clearly marked with identification codes or descriptions. Store material according to companies stacking norms Tata tea bags and cartons are stacked in a honey comb pattern. according to the stock control system prescribed by the principal company.
name of brand. If material is stored on pallets. They are also used tat the time of safety measures and cycle count. Stack card contains name of product. they are placed on goods as follows: • • • If material is stored in racks. Manoj Banshilal Pachouri 109 ICFAI Business School . manufactured date etc. batch number.Make stack cards Stack cards are prepared to ensure proper maintenance and delivery of material. number of quantity. stack card is pasted on rack. If material is putted on bitumen sheets. Place stack cards on goods After stack cards are prepared. stack card is putted on it. Stack cards can be substituted by barcode labels for better efficiency. stack card is placed in box.
[Tata Tea] Titan products are stored code wise. [Amara raja] Physical stock is verified against book value on daily basis. Same company goods are stored product wise. Stacking is done according to stacking norms of company. Newer Titan products are stacked behind older one to ensure FIFO.1.1. If it is damaged material is stored separately in scrap warehouse. Material is checked for damage.9 2.4 2. Engine number and frame number are also noted down.2.2.2 2.3. and received date to ensure FIFO.1 2.4 2. Godown Incharge 4 Persons Warehouse 22.1 2.7 2. FMCG products are stored to ascertain FEFO. Yellow lines are marked on the floor of warehouse and material has to be stored within those lines only.: nine items per stack). (e.6 2.10 Storing Material Separate locations are allotted for product of different companies.3.2.g.2 2.2 2. Tiles in Bell Ceramics are stored batch wise as shades change every batch. Bitumen set or pallets are used to store material as par the policy of company. Stacking always is honey comb. [McFills] Batteries are charged every 40 days. batch number.2.277 pieces per day (300 working days) Responsibility People Involved Location Frequency Input Output Reports Dataflow Documents Dataflow Documents Statutory MIS Invoice cum delivery challan Soft copy of stock sent to branch office [Amara raja batteries] Physical stock register updated Monthly report generated Order receiving modules Location of scrap and finished goods must be different Existing Integrations Controls Manoj Banshilal Pachouri 110 ICFAI Business School .8 2.5 2.Table 14: Storing Material Process Process Activities 2 2. Lorry number is noted down on seats of TVS bikes and stored brand wise. Stack cards are placed on lots containing manufacturing date.3 2.1 2.
Figure 5: Flowchart of Storing Material Process Manoj Banshilal Pachouri 111 ICFAI Business School .
If material is stocked on pallets. • • • • Manoj Banshilal Pachouri 112 ICFAI Business School . If material is stored in cartons. count the number of cartons or cases of base and multiply it by number of cartons or cases above it. If material is loose.Cycle Count Process This process is carried out regularly at fixed intervals. cycle count in TVS Motor and Amara Raja is done on daily basis while in Titan there is no scheduled time for it. count the number of cartons and multiply the number of items per carton to get the quantity. count all materials. Time interval varies from company to company ranging from one day to fifteen days. Very small accessories like screws are measured by weight. count the number of pallets and multiply the number of items per pallet to get the quantity. For instance. Store keeper counts the physical stock as per the following rules: • If material is staked on bitumen sheets. Then multiply this number with number of pieces per carton or case to get the total quantity.
6 3. Amara Raja batteries are counted pallet wise or item wise daily. Godown keeper 10 Persons Warehouse Company specific ( varies from daily to fortnightly) Book value register ASM notified Update physical value register for date and quantity Differences report Physical stock and Book value stock reports generated daily Storing Material.5 3.7 3. FMCG goods in McFills are counted packs wise and carton wise weekly. Accessory items are counted piece wise or weight wise Titan watches are not counted physically. Stock Maintenance Physical stock must be exactly equal to book value Dataflow Documents Dataflow Documents Statutory MIS Existing Integrations Controls Manoj Banshilal Pachouri 113 ICFAI Business School . Bell ceramic tiles are counted on fortnightly basis.1 3.Table 15: Cycle Count Process Process Activities 3 3. Voltas home appliances are counted item wise weekly.8 Responsibility People Involved Location Frequency Input Output Reports Cycle Count Bikes in TVS Motor are counted brand wise and variant wise daily.4 3. IM Technology SIM card pieces are not counted as they are crossdocked the same day.2 3.3 3.
Figure 6: Flowchart of Cycle Count Process Manoj Banshilal Pachouri 114 ICFAI Business School .
McFills. when written or telephonic order is placed with Fairdeal. This process is not controlled by Fairdeal other wise procedures of this process are similar to goods receiving process. When customer places an order. it is ascertained before punching the order that the cheques of respective customers are present with Fairdeal. Intimate customers about insufficient cash It is initialed when sufficient cash is not present in customer’s account or customer’s advance cheques are not present with the depot. These cheques are then submitted in the account of the respective principal company. Check availability of ordered goods When a customer places an order. Collect cheques from customers This process is in use in Bharti Teletech. Check availability of customer’s checks with Fairdeal Some principal companies like Tata tea. McFills and Bell ceramics require customers to keep advance cheques with Fairdeal. Some of the main activities in this process are: Receive stock transfer requests Stock transfer request process is initiated either by local ASM or ASM of requesting depot to transfer material from one depot to other.Order Punching Process Order punching process is initiated either by dealer or branch office. This process ends with computer operator accepting or rejecting the order. To do so. Bell Ceramics and Tata tea where cheques are collected from dealers on behalf of principal companies. Computer may alert insufficient cash message if customer has placed order of value greater than his credit limit. physical stock register is checked and verified against book value. it is ensured that the ordered quantity is available in warehouse. Manoj Banshilal Pachouri 115 ICFAI Business School . which includes Stock Transfer requests also.
2 4. order can not be punched into SAP R/3 Module. or via phone. Tata Tea. Amara Raja. Dealers can also place orders in E-Applications namely. [Voltas] NOTE: Orders are punched into Titan. Financial Accounting System (FAS) Storing Material. Check whether signed blank cheques of concerned dealer are available with Fairdeal or not. SAP R/3. SAP R/3 and SDNet. Bharti and McFills Manoj Banshilal Pachouri 116 ICFAI Business School . If not.6 Responsibility People Involved Location Frequency Input Output Reports Order Punching Orders are taken by sales officer along with DD or in writing by sending DD to Fairdeal. [Voltas.5 4.1. [Tata Tea.4 4. Bell Ceramics.1. Tata Tea] If order placed via phone it has to be punched into SDNet manually by warehouse personnel. [Tata Tea. inform the concerned dealer. DD details punched into order received form. Stock is checked for availability in warehouse/ depot even before punching the order as SAP R/3 does not allow order punching (though pending order can be made) if stock is not present. Though pending orders can be made. McFills Foods] Dataflow Documents Dataflow Documents Statutory MIS Existing Integrations Controls • If stock is not present. Physical Stock Register • Order entry not done if signed blank cheques of dealers are not with Fairdeal.2 4.1 4. Bell Ceramics and McFills] If company is using SAP R/3. Computer Operator 4 persons Shiromani office and warehouse 60 orders per day (300 working days) Order details in e-application Demand Draft or Cheques from dealer Order number generated Pending orders report SDNet. MRF Paints.3 4.Table 16: Order Punching Process Process Activities 4 4. Bell. TVS Motor. [Bharti] DD is submitted in Bank and deposit receipt obtained.
Figure 7: Flowchart of Order Punching Process Manoj Banshilal Pachouri 117 ICFAI Business School .
Short close orders in case of shortage of goods If ample quantity of ordered material is not present in the warehouse. computer operator modifies the order and changes the number of quantities ordered from modify order module. Manoj Banshilal Pachouri 118 ICFAI Business School . this order will remain pending till the ordered material with ample quantity is received in warehouse from factory location or through stock transfer.Order Approval Process Order approval process is initiated either by computer operator after an order is placed with Fairdeal. Some of the main activities in this process are: Make pending orders If ordered material is not present in the warehouse. This process ends with generating invoice number.
If stock is present order is approved. TVS Motor. Tata Tea.4 5.6 5. Check physical stock for threshold stock.2 5. Order is sent for verification by regional sales officer Once approved. Notification sent to dealer. Bell.7 5.10 Order Approval Stock is checked for availability in warehouse/ depot. [Bharti Teletech] Responsibility People Involved Location Frequency Input Output Reports Dataflow Documents Dataflow Documents Statutory MIS Existing Integrations Controls NOTE: Orders are approved in Titan. Manoj Banshilal Pachouri 119 ICFAI Business School . place order at company head office.5 5. Financial Accounting System (FAS) Storing Material. If stock is below threshold value. Physical Stock Register DD details are must for order approving.3 5. Amara Raja.1 5. dispatch order is generated on SDNet. [Bharti] If stock is not present. Computer operator 8 persons Shiromani office and Admin office at warehouse 73 orders per day (300 working days) Order details from ERP module Demand Draft or Cheque from dealer Dispatching order Invoice SDNet. order can be partial dispatched or short closed. MRF Paints.Table 17: Order Approval Process Process Activities 5 5. Update book stock value Stock is checked for availability in warehouse/ depot.8 5.9 5. Bharti and McFills Ltd. SAP R/3.
Figure 8: Flowchart of Order Approval Process Manoj Banshilal Pachouri 120 ICFAI Business School .
Stock transfer order is then forwarded to nearest C &FA depending on availability of stock.5 6. No sales tax or VAT is applicable on stock transfers as ownership of material does not change.2 6. If SAP R/3 or any other ERP package is not being used.Invoice/ Bill Printing/ Stock Transfer Process This process is initiated at the time of dispatching and ends with printing invoice or stock transfer memo in case of stock transfer. SAP R/3. bill is printed manually. Stock transfer document is printed from ‘Stock Transfer’ menu Stock transfer decision is taken by regional sales manager. Computer Operator 8 Persons Shiromani office and Admin office at warehouse 205 invoices per day (300 working days) Invoice number e-application Dispatching order Invoice Printout SDNet.3 6. raja e-ARIMS Order Punching. Invoice contains product specifications along with product value.7 Invoice/ Bill Printing/ Stock Transfer If SAP R/3 or any other ERP package is being used invoice is printed directly from ‘Print Invoice’ menu by entering order number. Invoice is printed in triplet either on company provided pre-printed stationery or on blank papers.1 6. Physical Stock Register Material movement out of warehouse Responsibility People Involved Location Frequency Input Output Reports Dataflow Documents Dataflow Documents Statutory MIS Existing Integrations Controls Manoj Banshilal Pachouri 121 ICFAI Business School .6 6.4 6. Table 18: Invoice/ Bill Printing/ Stock Transfer Process Process Activities 6 6.
Figure 9: Flowchart of Invoice/ Bill Printing/ Stock Transfer Process Manoj Banshilal Pachouri 122 ICFAI Business School .
Gate pass is then prepared and material is loaded on vehicle or handed over to courier person.Dispatching Process Pick slip is generated and sent to warehouse for picking material. Load material on vehicle At this stage. Check stock in warehouse after dispatching It is initiated by store Incharge at the time of loading material. When an order is received in warehouse. store Incharge intimates process manager who in turn will notify ASM and SCM. being dispatched. ordered items are picked from pallets. Manoj Banshilal Pachouri 123 ICFAI Business School . it is checked for the correct signature. This material will be indented to factory location for replenishment. bitumen sheets. Here they are packed. If material. Some of the main activities in this process are: Verify ordered quantity against invoice Issues are only made against orders which have been properly authorized. is found to be below a threshold value. marked and loaded onto trucks for delivery or handed direct to waiting customers. Sample signatures and initials of all authorized signatories must are made available to warehouse staff so that they can verify orders. shelves or racks and assembled in the goods-out area. Every dispatch order and is signed by process manager.
2 7.4 7.200 pieces per day (300 working days) Dispatching details in e-application Material specification from computer operator Dispatching number Acknowledgement SDNet.7 Dispatching Take material from warehouse on the basis of FIFO or FEFO.6 7. Delivery challan. Tiles are dispatched according to batch.5 7.1 7. Gate pass signed by authorized person. Bring material from secondary location to primary location. Material is Loaded on vehicle. Gate pass is made to allow goods outside warehouse. Depot Incharge 15 persons warehouse 22. LR. Responsibility People Involved Location Frequency Input Output Reports Dataflow Documents Dataflow Documents Statutory MIS Existing Integrations Controls Manoj Banshilal Pachouri 124 ICFAI Business School . gate pass and two copies of invoice are given to transporter.3 7. Financial Accounting System (FAS) Storing Material. Transport vehicle is checked for gate pass and physical goods. Physical Stock Register No order can be dispatched without proper documents like Invoice. SAP R/3.Table 19: Dispatching Process Process Activities 7 7.
Figure 10: Flowchart of Dispatching Process Manoj Banshilal Pachouri 125 ICFAI Business School .
Transportation Process This process is extension of dispatching process and is carried out after material is loaded on the vehicle. Fairdeal pays Octoroi on behalf of its principal which it claims later. Receive ‘goods received’ acknowledgement from customers When material is supplied to a customer. Purpose of this document is to keep track of the outbound material leaving the warehouse. This document is given back to remains with transporter which is used reimbursement. received acknowledgement from customer delivery. if applicable Octoroi is payable in select cities decided by state governments. There is no obligation to pay Octoroi when customers take the delivery at warehouse premises since ownership changes at warehouse in this case. transporter takes goods as a proof of correct Fairdeal and one copy at the time of freight Manoj Banshilal Pachouri 126 ICFAI Business School . Claim Octoroi claims from company As mentioned in Pay Octoroi sub process. Octoroi is paid on the material which is transported through its own vehicles or contracted vehicles. Fairdeal pays Octoroi on behalf of its principal which it claims later. Fairdeal provides transportation to local orders where as outsourced carriers and courier service providers provide transportation to upcountry orders. Some of the main activities in this process are: Prepare Gate pass Gate pass [refer to format of gate pass in APPENDIX B] is prepared after material is loaded into lorry or handed over to courier person in the presence of security Incharge. store keeper and transporter. It ranges from 4% to 5% of invoice value depending on the type of the product and city in which Octoroi is payable. Pay Octoroi.
Transportation Incharge 10 persons warehouse 22. Acknowledgement copy of invoice given back to Fairdeal. goods in transit Storing Material No order can be dispatched without proper documents like Invoice. Gate pass signed by authorized person. Octoroi charges are claimed from concerned company.Table 20: Transportation Process Process Activities 8 8. Up-country orders are dispatched through transport or courier services. Delivery challan.200 pieces per day (300 working days) Responsibility People Involved Location Frequency Input Output Reports Dataflow Documents Dataflow Documents Statutory MIS Gate pass from store Incharge Goods Received Acknowledgement Freight reimbursement report Current stock.2 8. Material is unloaded at dealer’s place.1 8.3 8.4 8. Dealer returns back one signed copy of invoice as acknowledgement of goods received. Existing Integrations Controls Manoj Banshilal Pachouri 127 ICFAI Business School .6 Transportation Local orders are dispatched through Fairdeal’s own vehicles or dealers collect their order from warehouse directly.5 8.2 8.1.1. Octoroi is paid in metropolitan cities.
Figure 11: Flowchart of Transportation Process Manoj Banshilal Pachouri 128 ICFAI Business School .
Manoj Banshilal Pachouri 129 ICFAI Business School . For instance. Slow-moving and unsalable material categories. change in technology. company is notified about its removal. Some of the main activities in this process are: Intimate principal about scrap material Fairdeal works closely with its principal companies so that there is a constant information exchange about stock requirements and stock levels. its spares will become obsolete. introduction of new brands. damage or any other reason. Dealers or Stockists initiate this process when material becomes unsalable because of expiry of date.Handling Unsalable Material Process Material is classified into Non-moving. Similarly. Fairdeal pays freight charges on behalf of principal company which it claims from them later. Transport claims includes loading and off-loading charges which vary product to product accordingly. if TVS motor decides to discontinue a vehicle. obsoleteness. Claim scrap transport charges from company Fairdeal has its own dedicated vehicles to deliver local orders to customers. when scrap material piles up above its threshold limit. When scrap material dispatched to principal company through its own vehicles or contracted vehicles. Scrap items are kept separate from new items in scrap warehouse.
11 Handling Unsalable/ Non Moving/ Slow Moving Material Dealer claims material as Unsalable. Manoj Banshilal Pachouri 130 ICFAI Business School . sales officer recommends it to area sales manager. After enough stock piles up. Sales officer inspects material. Area sales manager approves material as Unsalable.8 9. Store Incharge 12 persons warehouse 150 Cartons per month Responsibility People Involved Location Frequency Input Output Reports Dataflow Documents Dataflow Documents Statutory MIS Existing Integrations Controls Specification of unsalable material sent by dealer to Fairdeal DD details and scrap details mailed to SCM.6 9. Unsalable material is stored in scrap warehouse at different location. notification is sent to company Company approves removal of unsalable material Transporter is sent to collect the material Total quantity is verified against book value Material is loaded on vehicle and sent to company locations. Specification of unsalable material sent by Fairdeal to Company Monthly scrap material report Financial Accounting System (FAS) Physical Stock Register Scrap can be sold to company contracted scrap dealer only.9 9.2 9. Material is brought back to Fairdeal warehouse along with written approval of sales officer and dealer’s letter containing material details. If material is found unsalable.1 9.Table 21: Handling Unsalable Material Process Process Activities 9 9.7 9.5 9.4 9.3 9.10 9.
Figure 12: Flowchart of Handling Unsalable Material Process Manoj Banshilal Pachouri 131 ICFAI Business School .
After enough stock piles up.5 10.Handling Warranty Claims Process This process is only partially controlled by Fairdeal as most of the activities are handled either by dealer or by branch offices. If satisfied.13 10. If material is unrepairable it is considered as scrap Serial numbers of scrap material are destroyed to avoid re-claims. Dealer notifies service engineer about warranty claim. Table 22: Handling Warranty Claims Process Process Activities 10 10. Stock is sent to company if it can be repaired or serviced.14 10. service engineer approves warranty claim.2 10. Defected product is stored in scrap warehouse.12 10.9 10.16 Handling Warranty Claims Customer claims product replacement under warranty from dealer. New product is dispatched to dealer to replace defected one. Company is notified about warranty claim.6 10.4 10.3 10.15 10.8 10. Product comes to Fairdeal warehouse with product specification and warranty letter signed by service engineer. Customers initiate this process when material they purchased have any prepurchase defects or is damaged under warranty period. Store Incharge 4 persons warehouse 100 pieces per month Warranty claim details in SD module Warranty claim letter Electronic notification to company Invoice of replaced product Monthly Free replacement report Amara raja E-application (http://localhost/bs/) Scrap Stock Register Service Engineer must approve warranty claim Responsibility People Involved Location Frequency Input Output Reports Dataflow Documents Dataflow Documents Statutory MIS Existing Integrations Controls Manoj Banshilal Pachouri 132 ICFAI Business School . Scrap material sold to company’s scrap dealer DD of scrap material sent to company Head Office.11 10.7 10. Service engineer inspects product. notification is sent to company Company approves removal of defected stock.1 10.
Figure 13: Flowchart of Handling Warranty Claims Process Manoj Banshilal Pachouri 133 ICFAI Business School .
Moisture is regulated in warehouse by building stacks which are hollow inside so that air can circulate and by turning products over periodically. For instance. Others may need more specific care. particularly food products like McFills foods and snacks and sunfill oil from Coca Cola.Stock Maintenance Process Fairdeal is responsible for maintaining principal company’s stock in good marketable condition failing to which. Protection of material McFills products being consumable products are protected against moisture. Any that has been damaged or have been opened for checking are promptly repacked and sealed. Brass fire nozzles and foam mixer fittings are also cleaned. Fairdeal will have to pay for the damages occurred to the stock. by ensuring safety measures and by providing value added services like re-labeling. Regular checks are done for spillage and waste. Stock is maintained by doing physical inspection. warehouse is disinfested at regular intervals. Any rubbish or waste paper is a fire risk and is removed. Physical inspection is also done to ensure that all packages in stock are kept in good condition. Fire extinguishers are serviced but their schedule is not fixed. reporting etc. TVS motorbikes which are stored on roof remain in direct sunlight for a long time. Manoj Banshilal Pachouri 134 ICFAI Business School . Some products need special periodic attention like batteries in Amara Raja have to be checked for any leakages as they contain acids. Depot Incharge inspects material on fortnightly basis by checking stack cards of material. Slow-moving and Non-moving goods have to be inspected properly. Some of the main activities in this process are: Physical Inspection Fast moving goods are relatively less inspected as they are mostly fresh. repacking. Rodent preventive measures are also taken to avoid damage to warehouse stock. Furthermore. rodents and other hazardous products.
Re-pack material. tracking. Apart from these. In this process. Octoroi claims. Fairdeal provides with the labors who will stick new labels provided by company to the material. Manoj Banshilal Pachouri 135 ICFAI Business School . inspecting and reimbursement. Re-labeling is done when a new promotional scheme is launched or a new labeling is required due to price change or seasonal scheme has to be given. Freight claims. company provided tape and seal are applied to it. Fairdeal claims the labeling charges as value added services later with reimbursements. these reports are also used to track inventory and movement of goods. value added services claims and Clearing & Forwarding Agent reimbursements are charged on the basis of these reports. if required If packing or carton of material is found damaged or material is required to repack for distribution. Generate Reports Weekly and monthly reports are generated for the purpose of controlling. Re-labeling of goods This is value added service provided by Fairdeal to its principal companies.
9 Responsibility People Involved Location Frequency Input Output Reports Protecting Material Slow-moving and Non-moving goods are inspected by checking its stack cards or batch number and manufactured date Bikes are inspected for scratches and damages. micro organisms. expiry dates.8 11. Cycle count Rodents.4 11. FMCG goods are protected against moisture.6 11.3 11. inspecting and reimbursement of stock maintenance Depot Incharge 2 Person Warehouse No strict schedule followed Check last date from Maintenance register No of pieces destroyed notified to ASM Update maintenance register Maintenance reimbursement report when asked by management Storing Material. tracking. contamination.Table 23: Stock Maintenance Process Process Activities 11 11. Moisture content is controlled depending on products Fire extinguishers maintained for emergency situations Re-pack material packing or cases. theft Dataflow Documents Dataflow Documents Statutory MIS Existing Integrations Controls Manoj Banshilal Pachouri 136 ICFAI Business School . Batteries are charged every 40 days in warehouse.1 11. if pilferaged during storing Re-label packs or glue stickers to packs for promotional schemes under value added services Generate reports for the purpose of controlling.2 11.7 11.5 11. rodents.
Figure 14: Flowchart of Stock Maintenance Process Manoj Banshilal Pachouri 137 ICFAI Business School .
No clear plan to manage the involvement of other participants in the processes who will be impacted. Enter PIN and IMEI number (for Motorola only) using barcode scanner. In McFills Foods. weighted in the warehouse to check uniformity of cartons. In Amara Raja batteries. FIFO is violated. Warehouse terminal data is synchronized with company data via dial up virtual private network (VPN). To maintain FIFO. Serial number is destroyed from batteries to avoid re-claims and a hole is made into battery.Initial Issues Emerged Out Of AS-IS Analysis Table 24: AS-IS Analysis -Important issues with priorities Issues/Observations In Titan watches division Carton is checked for any physical damage and pilferage. To scan PIN and IMEI number. If weight doesn’t match. Indent form is filled in Microsoft Excel (. Inwards from Hyderabad have to be done using scanner as SAP R/3 is still not implemented there. Dadra material is not required to be scanned as delivery number can be used in SAP R/3 module to get all serial numbers. Company has provided with a charger which can charge 32 batteries at one time. Battery must be charged every 40 days even in warehouse. This process can be simplified if cordless barcode scanner is used. staff time. Employees should be encouraged to learn multiple (at least two) companies’ operations like SAP R/3 of Tata Tea and SDNet of Bharti Teletech. In Titan watches division Carton contains packing slip containing number of pieces and codes. carton can be opened in presence of courier boy itself. This packing slip is validated against stock transfer memo in which number of pieces and price of each watch is given along with trade discount and sales tax. If new watches come in front. Common tasks might be handled more efficiently by coordinating among each other. This will ensure smooth operations of Fairdeal even in case of absenteeism or job vacancies. Priority (High/ Medium/Low) High High Medium High High Low Medium High High Medium Low Medium High High Manoj Banshilal Pachouri 138 ICFAI Business School . Lack of group dynamics among employees. This consumes labour hours. Motorola cartons have to be brought upstairs near computer attached barcode scanner. They are still using very primitive softwares. stacking is used in which new watches are placed behind old watches. Current technology does not provide basic/fundamental warehouse stock information required by management. increases waiting time and hence cycle time.xls) format and attached to email to Company. In Voltas.
listening skills. Gate pass is mandatory for taking goods outside warehouse.Issues/Observations Some employees need HR training to motivate them and to develop their business communication skills. Attrition of employees is hindering smooth operations Principal companies co-operation to implement barcode readers Salary structure of employees Priority (High/ Medium/Low) Medium High High Medium Medium Manoj Banshilal Pachouri 139 ICFAI Business School .
pallet or bitumen sheets etc. are using very primitive software packages which should be upgraded to better ones to increase efficiency and speed of transactions. For example: MRF Paints and McFills Foods Pvt. To inspect for inverted cases. This person’s duty would be to take care of material of all companies and not specific to a particular company as being followed at present. Computer operators complain about the lack of meaningful management information system like slow speed internet services. Ltd. • • Data gathered during this phase would make basis for research in next phase. These connections should be upgraded to broadband connections to improve speed and quality of information sharing. There should be a separate person whose duty would be: To inspect physical location of material. TO-BE Analysis. To take physical stock. To check method of stacking material. To inspect whether material is stored according to FIFO norms. There are issues of transferring large business data through internet because of slow speed of internet connections. Manoj Banshilal Pachouri 140 ICFAI Business School .Other Notes from Interviews These are excerpts from interviews with senior and middle level managers in the organization: • Many companies are using very primitive application software packages which should be upgraded to better ones.
TO-BE ANALYSIS Manoj Banshilal Pachouri 141 ICFAI Business School .
this plan could not materialize. This phase was aimed at detailed documentation of activities being carried out in each and every process. Sharad Jobanputra about benchmarking processes. It was also planned to visit some other warehouses nearby so as to study their processes. Cubing and many other warehousing concepts. processes were studied from various Warehouse Management Systems. Furthermore. I discussed all the processes with process owners and process users of every company handled by Fairdeal. AS-IS Analysis phase of this project highlighted the processes which needed either modification or re-engineering. Zankar Jobanputra and Mr. I download 300 mb WinZip version of IntelliTrack’s Intelliwms and studied it thoroughly after installing it. Manoj Banshilal Pachouri 142 ICFAI Business School . To achieve this. But due to lack of time during year-end operations in March and implementation of VAT in Gujarat from April 2006 afterwards.Definition of TO-BE Analysis The goal of To-Be Analysis design is to produce one or more alternatives to the current situation. To compensate this. dispatching process was benchmarked against Hindustan Lever Limited (HLL)’s dispatching process. it was planned to take demos of some four or five warehouse management systems to get best practices from them. I also discussed the issues with Mr. They provided me with many suggestions and their usefulness about how efficiency of Fairdeal can be improved. Some of the processes were benchmarked against other companies’ processes. Waves. TO-BE phase aims at benchmarking processes being carried out against best industry practices. which satisfy goals of the enterprise as stated in the business case analysis and which satisfy the change-requirements. For instance. This demo version gave me a lot of inputs about Kitting. Initially.
proper preparations should be done like creating warehouse layout. and shipped. This may include zones. In order for the warehouse to operate efficiently.Preparation for Implementing Re-Designed Processes Before designing TO-BE processes. • Material Flow in the Warehouse After the usable warehouse space and item size have been determined. Warehouse must be capable enough to implement them. valuable. • Items Define the items the warehouse handles. • Available Space (to support the Cubing feature) Calculate the space available for item storage to support the cubing feature. material storage and warehouse layout should be planned based upon how the goods and materials are received. including the boundaries that separate them. aisles. rows. material flow). following areas of warehouse operation should be reviewed: • Storage Locations All of the storage locations within the warehouse should be clearly defined. implementing barcode scanning. identify the process by which material is moved through the warehouse (i. since a Warehouse operates within a dynamic environment in which material moves from receiving to storage to shipping. or temperature controlled materials. shapes and sizes that are required. stored. These items can be defined in SKUs (Stock Keepting Units). Manoj Banshilal Pachouri 143 ICFAI Business School . sequencing the replenishment and picking processes etc. For this. picked.e. Also determine whether these locations accommodate all the item types. and storage areas in a controlled environment for storing hazardous.. Assembling Warehouse Data To assemble warehouse data.
Locations are then added to each site. yellow lines can be marked on the floor to specify storing space. Further. Locations reside within a ‘Site’ and are added to a site at the Locations form in WMS. REC 02 etc. Each site should be coded accordingly. When locations are created for a site. and must be entered in the Locations form in WMS: Manoj Banshilal Pachouri 144 ICFAI Business School . and Dispatching site can be coded as D-01. D-02 etc to locate it easily.Warehouse Layout Figure 15: Warehouse Layout Warehouse should be divided into in to different sites like Receiving site. Dispatching site. The following information is required to add a location. Bulk storing site can be coded as A-01. the warehouse space is divided into specific sites. Scrap site etc. For instance receiving site can be coded as REC 01. A-02 etc.
• • • •
Site: the warehouse/facility where this location resides. Location Identifier: a unique system identifier that you create for this location, entered in the Location cell. Description: a description of the location (i.e., forward pick, staging, receiving, picking, storage). Cube Size: The cubic size of a location represents the storage space available in that location, it may be an exact number, or a close estimate, depending on storage requirements and WMS objectives. For example, a location with a cubic size of one hundred can hold one hundred items with a cubic size of one or it can hold two items with a cubic size of fifty. Pick sequence: assign the location travel sequence when picking items (picking process) in this cell Put away sequence: assign the location travel sequence for putting away items (receiving process) in this cell.
NOTES: When location sequencing is implemented, the sequence number directs the user, with an RF portable, to a predefined location when picking and/ or putting away order items. (WMS sorts line items into the sequence defined and presents the line item in sequential order.) This reduces the travel time when putting away and picking orders. Before establishing a location sequencing for picking orders, putting away orders, and replenishing stock, it is a good idea to identify the process by which material is moved through warehouse (i.e., material flow), in order to determine the most efficient travel sequences. A good starting point would be the movement of the top twenty percent of inventory.
Manoj Banshilal Pachouri
ICFAI Business School
Specifying the Replenishment Sequence When a forward pick (or prime) location is restocked, it is possible to use a replenishment sequence to guide in the put away process. The replenishment sequence is an inventory move based on the pick sequence of the bulk storage location. When replenishing a forward pick location, an item location may be specified. If replenishment is implemented: • WMS sorts items requiring restock in a sequence based on locations where the bulk stock resides and the pick sequence assigned to that location. WMS guides the picker to the lowest picking sequence location for the first item requiring restock.
Implementing Location Sequencing To implement location sequencing, a pick and/or put away sequence number is assigned to a location. (The lower the location sequence number, the higher it’s priority as a pick or put away location.) Often, a location with the lowest primary pick sequence number will have the highest put away sequence number. The table below highlights a typical location number sequence.
Table 25: Example of Location Sequence Numbers Location FP-001 FP-002 REC SHP1 01-A-01 01-A-02 Description Forward Pick Forward Pick Receiving Staging Bulk Storage Bulk Storage Pick Sequence 1 1 0 0 9 8 Put Away Sequence 8 8 0 0 1 2
Locations REC and SHP1 have a pick and put away sequence number of zero, which is outside the sequence number range; hence these locations are excluded from location sequencing.
Manoj Banshilal Pachouri
ICFAI Business School
Generating Barcode Labels WMS should be able to generate barcode labels for material stored in the warehouse. Barcode printing should be integrated with company specific ERP modules so that material specifications can be directly imported from these modules. Other facilities that are required for barcode generation are as follows: • • • • • Label Printing Setting Label Characteristics Creating Sequential Number Label Creating Custom Data Label Adding a Customized Label Format
Import-Export Data To and From WMS The Import-Export Utility allows for the importing of data into WMS and exporting of data from WMS through the following interfaces:
Data Interfaces Host Picking Host Receiving Inventory Export Inventory Import Item Export Item Import Location Export Location Import Picking Export Picking Import Receiving Export Receiving Import Description Communicates picking order activity back to a host system. Communicates receiving order activity back to a host system. Exports specified inventory data to a specified text file. Imports inventory data from a specified text file into the WMS database. Exports specified item data to a specified text file. Imports item data from a specified text file into the WMS database. Exports specified location data to a specified text file. Imports location data from a specified text file into the WMS database. Exports specified picking data to a specified text file. Imports picking data from a specified text file into the WMS database. Exports specified receiving data to a specified text file. Imports receiving data from a specified text file into the WMS database.
Manoj Banshilal Pachouri
ICFAI Business School
Synchronize Fairdeal WMS and Principal’s ERP Module To ensure smooth and errorless flow of data from principal company’s ERP module to Fairdeal’s WMS and vice-versa, some integrating software should be used with the help of principal company. Trying to insert data manually in either of ERP module or WMS will increase chances of erroneous entries which would defeat the purpose of automating Fairdeal’s operations. Once both the software packages are integrated, Import-Export interfaces could be used for transferring data to and from one system to another. Though convincing every principal company to provide with integrating software package is not an easy task and it will take a fairly good amount of time before this concept comes to reality; but it is also certain that if data of WMS and ERP module can be synchronized, operations of Fairdeal will become very easy to execute and maintain.
Manoj Banshilal Pachouri
ICFAI Business School
At this stage. dealers and other staff members are also involved in it. proper documents with quantity and service engineer’s sign should accompany the material. advance intimation will allow Fairdeal staff to prepare for the coming consignment. This will save time at the time of dispatching and hence efficiency of dispatching process will increase. Once material comes to warehouse. This will save time spent in uploading barcode serial numbers in Voltas. Material will then be checked for any physical damages and weight of cases will be taken if any possibility of pilferage is seen. Branch office. In case material is warranty claim or goods return under unsalable material.To-Be Goods Receiving Process Goods receiving process should be redesigned in such a manner that it takes shortest possible time. barcode serial numbers should be scanned to verify that the correct material is received. Vehicle details will be noted down along with the company’s name for which material has come. whichever is applicable. TVS Motors and Bharti Teletech. It is because this process is not totally internal to Fairdeal and Transporter. Gate keeper will check the material and intimate Godown keeper and process owner who will verify documents given by transporter. Head office. Moreover. Manoj Banshilal Pachouri 149 ICFAI Business School . Fairdeal should get softcopy of Stock Transfer Memo (STM) or transfer cum delivery challan.
Goods Storing.1 1.g. Documents received from transporter or courier person containing material specification.2 1. Transporter copy of STM acknowledged. Damages report. Material stored in warehouse.1 1.9 1. Inventory stock Can Fairdeal convince its clients to provide with integrating software? SAP and WMS data synchronized with each other.3 1. Inventory report Activities Process Steps 1.7 1. carton will be opened in presence of courier person.6. In case of mismatch. Goods arrive from factory locations or other locations in case of StockTransfers and Goods Returns. Goods Return Note Dataflow Update Goods-in-Transit module of ERP Documents Acknowledgement to transporter Reports Stock receipt report. • Local ASO (Area Sales Officer) is informed. Material unloaded from vehicle.6.8 1. In case of Titan.5 1. shortage report if material found damaged or short respectively Manoj Banshilal Pachouri 150 ICFAI Business School . tool kit. Upload Goods-In-Transit module Synchronize data of ERP module and Fairdeal WMS Main Godown Keeper WMS. In case of physical damage or short supply: • Supply Chain Manger is informed.4 1. If space or labor is not sufficient. • Damage claim or Shortage claim is prepared. Lorry or Courier vehicle entry made in Gate Register at main gate.6. make arrangements for coming material.3 1. Material manually inspected for any physical damage and accessories E. TVS bikes are checked for key.10 Process Owner Integration Points of Concern Wish List Additional Notes Plan labor and space required for material. rear view mirror and battery. Individual carton is weighed and verified against printed weight on carton.Table 26: TO-BE Goods Receiving Process Process ID Objective Function Input Output 1 Goods Receiving Receive Goods at Warehouse Clearing and Forwarding Dataflow Soft copy of Stock Transfer Memo (STM) Documents Invoice cum delivery challan.2 1. LR receipt.
Figure 16: Flowchart of TO-BE Goods Receiving Process Manoj Banshilal Pachouri 151 ICFAI Business School .
pallet wise.1 2.g.e. E. Goods receiving.5 Scan serial numbers of finished goods and transfer them to WMS. product wise 2. it is sorted accordingly.To-Be Storing Material Process After material is received in warehouse. 2. as applicable Store goods at their allotted locations according to company specified 2. Table 27: TO-BE Storing Material Process Process ID Objective Function Input Output 2 Storing Material Store goods in warehouse Warehousing Dataflow Material specification imported from SAP module. apply taping and other fixes.7 Stick barcode labels to goods or locations.6 or batch wise. as required 2. Documents Copy of STM with material serial numbers and specifications Dataflow Barcode labels Documents Reports Physical stock register updated Current stock report. If it needs repacking 2. Inventory report Activities Process Steps Process Owner Integration Points of Concern Wish List Additional Notes Decide the site of material i.3 or taping.4 Update goods specifications in WMS inventory module 2.8 regulations. scrap site or finished goods site Sort the material product wise as applicable Check material for packing and physical damage.2 Manoj Banshilal Pachouri 152 ICFAI Business School . Inventory stock Care to be taken while sticking barcode labels so that mismatch does not occur RFID could be used to locate and quantify the stock Additional physical stock register can be maintained for use of physical verification 2. home appliances and tiles are stored on pallets where as watches are stored in racks Depot Incharge ERP module. Material received under warranty claims and goods returns is stored in scrap warehouse where as fresh material received from factory locations or through stock transfer is stored in finished goods warehouse. Generate barcode labels for goods lot wise. Batteries.
Figure 17: Flowchart of TO-BE Storing Material Process Manoj Banshilal Pachouri 153 ICFAI Business School .
weighted in the warehouse to check uniformity of cartons. damages. Titan Carton checked for any physical damage and pilferage. rodents. Battery must be charged every 40 days in warehouse. temperature. barcode and plastic wrapping. Bikes inspected for scratches. damages and Engine number slips. Process Owner Integration Points of Concern Wish List Additional Notes Store keeper Current Inventory stock It is practically not possible to take physical stock of small products like watches and spare parts frequently RFID could be used to verify physical stock smoothly Specialists may be hired for checking micro-organism level in food products location Manoj Banshilal Pachouri 154 ICFAI Business School .1 3. embossing. FMCG goods checked for air-leaks. physical stock might be taken on twice a week basis. type of battery. For instance.3 3. expired dates.7 Sites inspected for moisture level. where as checking for micro-organism level in foods storing location can be done monthly or quarterly. Frequency of different types of checking can differ accordingly.2 3. Table 28: TO-BE Cycle Count Process Process ID Objective Function Input 3 Cycle Count Finding any discrepancy in physical stock against book value Stock keeping Dataflow Cycle count alert displayed to depot Incharge on set day Documents Printout of current stock from WMS Inspection date updated in WMS Physical stock register updated Differences report Activities Output Dataflow Documents Reports Process Steps 3.To-Be Cycle Count Process Material should be regularly inspected for matching physical stock against book value and to find any probable harm to sensitive goods like food products.5 3. Batteries physically checked for damage.4 3. infestation and security issues.
Figure 18: Flowchart of TO-BE Cycle Count Process Manoj Banshilal Pachouri 155 ICFAI Business School .
nor do dealers have sufficient IT competency and investment options to place orders online. In India. This process lies either with dealer/ distributor or Branch office of the principal company.To-Be Order Punching Process Detailed study of supply chain and logistics industry revealed that order punching process does not lie within operations of Clearing & Forwarding agent. Clearing & Forwarding agents have to bear the burden of order taking / order punching process because of lack of proper IT infrastructure and insufficient IT skills of dealers. Manoj Banshilal Pachouri 156 ICFAI Business School . Apart form these reasons. which are then punched into ERP modules by Clearing & Forwarding agents. dealers place their orders either on phone or in writing. Hence ideally. this process should not be there in Clearing & Forwarding Agent’s operations. In light of reasons mentioned above. broadband connections in India are just coming up and most of the internet connections used are dial up connections which does not provide enough speed to perform online transactions. Most of the companies in India do not have centralized internet based order placing systems.
To-Be Order Approval Process Order approval process is executed according to rules and regulations of principal company. order is accepted and approved else order can be partial dispatched or short closed. this process is only partially controlled by Fairdeal. Dispatching. Invoice number generated Monthly sales report.2 5.7 5. place order at company head office.3 5. Current stock available All dealers might not be capable of placing orders online ASM might ask to approve orders to fulfill his targets All order placing should be automated without any paper work Credit cards be used to replace Demand drafts and Cheques If material is not present in warehouse.8 Process Owner Integration Points of Concern Wish List Additional Notes Stock is checked for availability in warehouse/ depot If stock is present in required quantity. Once approved.6 5. Even in the case of companies whose order approval processes are undertaken by Fairdeal. If company is Bharti Teletech. Pick slip is generated from approved order Pick slip sent to store Incharge Check inventory stock for threshold value If stock is below threshold value. whereas others have delegated it to Fairdeal. Some companies’ order approval process resides with branch office of the company itself. Manoj Banshilal Pachouri 157 ICFAI Business School .1 5. order should not be accepted by ERP package when dealers place it. Cash report.4 5. Current stock report Activities Output Dataflow Documents Reports Process Steps 5.5 5. Credit limits of dealers. order is sent for verification by regional sales officer. Table 29: TO-BE Order Approval Process Process ID Objective Function Input 5 Order Approval Approving orders placed by dealers Order verification and dispatching Dataflow Order punched by dealer Documents Cheque or Demand draft for order placed Order approved or rejected. Synchronize order approval data on WMS and ERP modules Computer Operator Pending orders.
Figure 19: Flowchart of TO-BE Order Approval Process Manoj Banshilal Pachouri 158 ICFAI Business School .
Pending orders Invoice will not generate if barcode serial numbers or other data is wrongly punched Companies replace their legacy IT systems with modern ERP packages If material is not present in warehouse. Table 30: TO-BE Invoice/ Bill Printing/ Stock Transfer Process Process ID Objective Function Input 6 Invoice/ Bill Printing/ Stock Transfer Issue a document as a proof of change of ownership Invoice / Bill/ Stock transfer memo printing for handing it over to transporter Dataflow Invoice number generated during order approval Documents Material ready to be issued acknowledgement form store keeper Order completed notification Invoice/ Stock transfer memo printout Total transactions report Activities Output Dataflow Documents Reports Process Steps 6. VAT and sales tax payments.3 Process Owner Integration Points of Concern Wish List Additional Notes Invoice printed directly from ‘Print Invoice’ menu of ERP package by entering invoice number. It is printed in triplet for the purpose of Octoroi taxes.1 6. Manoj Banshilal Pachouri 159 ICFAI Business School . Print stock transfer memo from ‘Stock Transfer’ menu Hand over the printed document to transporter Computer Operator Dispatching. order should not be accepted by ERP package when dealers place it. Stock transfer decision is taken by regional sales manager.2 6. Also. stock transfer document is similar to invoice except that it is addressed to another Clearing & Forwarding agent.To-Be Invoice/ Bill Printing/ Stock Transfer Process Invoice is printed at the time of dispatching fresh material or replacing warranty claims.
Figure 20: Flowchart of TO-BE Invoice/ Stock Transfer Process Manoj Banshilal Pachouri 160 ICFAI Business School .
Octoroi amount given to transporter to be paid at toll tax point. Gate pass made to allow goods outside warehouse. Depot Incharge Current stock.6 7. security personnel and driver of vehicle.3 7.2 7. LR. RFID could be used to locate and pick ordered material easily Copy of signatures of all authorized persons should reside with security team at main gate to verify gate pass signatures. Transport vehicle checked for physical goods at main gate Process Owner Integration Points of Concern Wish List Additional Notes Check dispatched material after picking. Delivery challan. Material loaded on vehicle in presence of store keeper. If sufficient quantity is not present at primary location. gate pass and two copies of invoice given to transporter.8 Pick slip comes to Store keeper Material picked from locations based on predefined picking sequence or kit.1 7.7 7.5 7. Labor Incharge.4 7. Manoj Banshilal Pachouri 161 ICFAI Business School . bring material from secondary location to primary location. If order is local.To-Be Dispatching Process As mentioned in AS-IS Analysis phase. Local orders are dispatched through Fairdeal’s own vehicles and Octoroi charges are also bore by Fairdeal. Table 31: TO-BE Dispatching Process Process ID Objective Function Input 7 Dispatching Transfer ordered quantity from warehouse to dealer’s place Picking material from warehouse and load it on transporter vehicle Dataflow Dispatching details in e-application Documents Pick slip Notification sent to dealer and branch office Gate pass and LR Monthly current inventory report Activities Output Dataflow Documents Reports Process Steps 7. Security checking at main gate No order should be dispatched without proper documents like Invoice. Upcountry orders are dispatched via contracted transporters and these transporters pay Octoroi charges which they claim monthly at the time of freight reimbursement. Gate pass signed by authorized person as breech in security check can prove fatal for operations of Fairdeal.
Figure 21: Flowchart of TO-BE Dispatching Process Manoj Banshilal Pachouri 162 ICFAI Business School .
3 8.4 8. Table 32: TO-BE Transportation Process Process ID Objective Function Input 8 Transportation Transport ordered quantity to dealer’s place Transporting Dataflow Documents Gate pass from store Incharge Mail to dealer about goods in transit Goods Received Acknowledgement from Dealer Monthly freight reimbursement reports Activities Output Dataflow Documents Reports Process Steps 8.5 8. Security checking at main gate No lorry should leave warehouse without proper security checks.6 8. Fairdeal’s own vehicle are provided additional amount for fuel and maintenance while contracted vehicles charge freight charges on monthly basis Manoj Banshilal Pachouri 163 ICFAI Business School . Local orders are dispatched through Fairdeal’s own vehicles and Octoroi charges are also bore by Fairdeal. use Fairdeal’s own vehicles else use outsourced carrier.2 8. if applicable Material off-loaded at dealer’s place Dealer returns back one signed copy of invoice as acknowledgement of goods received Acknowledgement copy of invoice given back to Fairdeal. Upcountry orders are dispatched via contracted transporters and these transporters pay Octoroi charges which they claim monthly at the time of freight reimbursement. Loaded vehicle leaves warehouse after security check Octoroi paid in metropolitan cities. Octoroi charges and freight charges claimed from concerned company Process Owner Integration Points of Concern Wish List Additional Notes Transportation Incharge Labor Incharge.1 8.7 If order is local.To-Be Transportation Process As mentioned in AS-IS Analysis phase.
Figure 22: Flowchart of TO-BE Transportation Process Manoj Banshilal Pachouri 164 ICFAI Business School .
Though. if time permits. Hence. and hence. Both the processes are initiated by dealers or customers and Fairdeal comes to know about it only when material comes to warehouse as goods returned. Manoj Banshilal Pachouri 165 ICFAI Business School .To-Be Warranty Claims & Unsalable Material Process Handling Unsalable Material process and Handling Warranty Claims process which were explained in detail in AS-IS Analysis phase are not controlled by Fairdeal. TO-BE processes for these two aforesaid processes are not inside purview of this study. These processes are handled on behalf of principal companies. are controlled by them. I would work on these processes after my main study is complete.
Furthermore. Moisture can be regulated in warehouse by proper ventilation so that air can circulate and by turning over product bags periodically depending on product needs. Rodent preventive measures could be taken on quarterly basis. warehouse must be disinfested on monthly basis. Furthermore. If the level of moisture is allowed to exceed the stated safety limit for storing a product. TVS motorbikes must not remain in direct sunlight for a long time as their seats may rip apart. there is a risk of damage by microorganisms. Details of packing and re-labeling should be conveyed by the warehouse Incharge about type of packaging required and the dimensions needed for both individual packages and outer container. Depot Incharge should inspect material on fortnightly basis by checking barcode labels of material to determine slow-moving material and unsalable material. To preserve the quality of stored goods. adding to it. Manoj Banshilal Pachouri 166 ICFAI Business School . the moisture content should be controlled. This process is important as many a delay has been caused because the name and location of the receiver had not been marked clearly or correctly.TO-BE Stock Maintenance Process Many measures can be taken to maintain stock at Fairdeal in a better way than maintenance measures in practice at present. McFills food bags must be kept at a certain relative humidity and temperature. unambiguous instructions must be given to packing team about how the packages should be marked.
5 Moisture content is controlled depending on products 11. micro organisms. 11.7 Re-pack material packing or cases.3 contamination. 11.9 and reimbursement of stock maintenance Depot Incharge Current Stock module No lorry should leave warehouse without proper security checks. FMCG goods are protected against moisture.6 Fire extinguishers maintained for emergency situations 11. Fairdeal’s own vehicle are provided additional amount for fuel and maintenance while contracted vehicles charge freight charges on monthly basis 11.4 Batteries are charged every 40 days in warehouse. 11.1 11. rodents.Table 33: TO-BE Stock Maintenance Process Process ID Objective Function Input Output 11 Stock Maintenance To maintain stock safety Inventory Management Dataflow Reminder alerted by WMS on set day Documents Check last date from Maintenance register Dataflow No of pieces destroyed. inspecting 11. tracking. if pilferaged during storing Re-label packs or glue stickers to packs for promotional schemes 11. measures taken notified to Depot Incharge Documents Update maintenance register Reports Monthly maintenance reimbursement report Activities Process Steps Process Owner Integration Points of Concern Wish List Additional Notes Proper shading for items stored outside or on roof.2 Manoj Banshilal Pachouri 167 ICFAI Business School . Bikes are inspected for scratches and damages.8 under value added services Generate reports for the purpose of controlling.
Figure 23: Flowchart of TO-BE Stock Maintenance Process Manoj Banshilal Pachouri 168 ICFAI Business School .
SUGGESTIONS AND RECOMMENDATINS Manoj Banshilal Pachouri 169 ICFAI Business School .
A modern WMS should have powerful computational tools. Bangalore.Characteristics of an Ideal WMS As ultimate objective of this project is to analyze. Replication is simply the process of sharing data between databases in different locations. it means that information is all accurate and up-to-date in every location. combined with an extensive array of international management features. In other words. Fairdeal can use this option as has operations in Ahmedabad. euro & dollar support. to manage a global enterprise while complying with a wide variety of national accounting standards worldwide is also required. to make the data available to all the institution locations or entities. it would be relevant here to discuss characteristics of an ideal WMS. document and report to management the merits and demerits of implementing warehouse management system in Fairdeal. reliable information management. Multi-branch support WMS should support remote multi-branch operations and help sharing information between the Head Office and the institution’s branches. Fully Integrated WMS should be totally linked to all financial modules. Therefore. performance integrity. management of receivables from clients and payments to suppliers on pre-defined due dates will be easier with Accounts Receivable and Accounts Payable modules. it is planning to have pan India presence and is expanding. support for value-added taxes. LAN or WAN networks can be used to provide multi-branch support. To attain the aforesaid capabilities it should have: Multinational Support WMS should satisfy the most demanding international requirements. Manoj Banshilal Pachouri ICFAI Business School 170 . operational flexibility and strong back up and safety measures to avoid any misuse and loss of data. Dehradun. Also. Multi-currency support with main local currencies. like the customers and financial information. from consolidation routines to automatic generation of inter-company transactions. WMS should replicate data. Hosur and Surat.
They provide an important feature to streamline cash flow process and help saving money. Manoj Banshilal Pachouri ICFAI Business School 171 .Third Party Catalog Third party accounts (Customers. where required. contact information. It simplifies the management of enterprise-wide information by using one central database. Information should be consolidated in the same place and made available to all modules. Forwarders and Shipping Agencies) should be created as contacts in the address book. a contact should be identified as a supplier. Credit Limits & Payment Terms A well planned WMS should provide a flexible definition of the credit conditions. Third Party Information Third parties should be classified by categories. Depending on the business relation with the organization. This direct entry facilitates the management and tracking per container and per client of single and consolidated shipments. This option eliminates redundant data entry and reduces errors. Bill of Lading A quality WMS should have features to allow an easy creation and printing of the Bill of Lading. main business. The system should also be flexible to create a Clearing file from each Bill and should allow the addition of the related expenses to each file and to generate invoices for the rendered Forwarding/Clearing services. a vendor or both at the same time. like the credit limit or payment terms. Contact name. The client credit limit should be controlled when preparing a sales order or a direct invoice. full address including the default dealing currency help in answering the information needs and improving the vital relationship with the third party’s organization. Debit limit and terms of payments are defined per supplier. This feature is important for segregation in order to provide exceptional reporting flexibility. Salesmen/Collectors. to accommodate with a diverse customer and vendor base. Shippers.
) and others that cannot (i. the file could be re-opened or an amendment file should be created. parent or child) or for a parent file and all its amendments. The user can create an unlimited number of user-defined cost elements. Cost/profitability reports should also be generated later on for any file (i.User Defined Cost Elements In Clearing and Forwarding. water or any unforeseen natural calamity. Security WMS should ensure that the right to use all crucial business processes is secure. Once all Forwarding and Clearing expenses are processed and invoiced. one for the expenses that cannot be invoiced and the other for the ones to invoice. the Client File could be closed. Groups can be assigned different authority levels that filter the rights of each user belonging to a group. insurance. Invoicing The system should allow the option to print two separate invoices. Data Backup There should be proper data backup functionalities in any good Warehouse Management System to ensure unstopped and smooth operations during unexpected system failures due to earth quakes.). Backed up data should not be stored at the same premise where WMS is installed because there is danger of loss of both WMS data and backed up data at the time of damage to this premise. the cost elements can be classified into items that can be invoiced (i. fire. Effective tools must be provided to manage security and provide users with a secure access to Clearing & Forwarding.e. should not affect the Expenses and Revenues Ledgers. is also available. Manoj Banshilal Pachouri 172 ICFAI Business School . duties etc.e. When posted to the Financial Systems.e. If additional expenses need to be added to a closed file. freight etc. Security groups can be created to restrict access to specific functions. items that cannot be invoiced and are billed at cost. customs. and thus should not influence the turnover of the company.
like ASCII. Furthermore. periodic analysis reports: • • • • • • • • Tracking of expenses by date. per file Total sales by salesman Manoj Banshilal Pachouri 173 ICFAI Business School . invoice status. for a specific client and a specific shipment. List of invoices filtered by date.Reports A well integrated WMS should provide the required flexibility to produce effective reports and enable the users to export all report data to an external file. utilizing most of the standard supported data types. Rtf or Excel. collector and currency Statistics of containers detailed by commodity Statistics of containers Expected cargo List of client shipments per vessel List of customs per client. inclusive but not exhaustive. customer. the system should be able to generate the following.
Suggestions and Recommendations Detailed study of operations of Fairdeal during Process Analysis. every employee will meet them and there will be no utility of setting variable salary. Some of the issues which need management attention are discussed below with possible suggestions and recommendations. Salaries are decided based on designation and years of work experience of employee. Manoj Banshilal Pachouri 174 ICFAI Business School . Current Status: This issue has already been taken up by management and it is planned to implement variable salaries from year 2006. ABC Analysis. It will be important to notice here that since Fairdeal has to deal with less educated employees who are just matriculate or preuniversity pass-outs. there are many issues that should be taken care of to improve its efficiency. Salary Structure of Employees Presently. ASIS Analysis and TO-BE Analysis revealed that though procedures being used at Fairdeal are more mature compared to other Clearing & Forwarding agents operating in Gujarat. and if targets are too difficult to achieve they will not motivate employees to work hard and objective of variable salary to motivate employees will be lost. it is difficult to implement all HR practices for them. Recommendations: Salary structure should be modified to variable salary structure in which one component should be fixed and other should be kept variable as incentives and bonuses. Also it is not possible to give increments in salary regularly to them because in such case Cost to Company (CTC) of Employee will increase marginal productivity of Labor (MPL) which will be against interests of Fairdeal. salary structure of employees is fixed salary structure in which employees are paid a fixed amount per month. Clearly measurable targets should be defined and communicated to employees which would be basis for deciding incentives and bonuses of individual employee. These targets can be defined in such a way that neither they are too impractical to achieve nor they are too easy to achieve because if target are too easy.
The operations which were handled by him alone could not be handled by Manoj Banshilal Pachouri 175 ICFAI Business School . They have learnt it by R&D and trail and error methods. Recently in April 2006. Training to Computer Operators No formal training is given to SDNet operators in Bharti Teletech. Zankar Jobanputra. Recommendations: IMEI numbers can be scanned in Notepad in the Motorola warehouse at the time of receiving mobile phone containers and then this text file can be sent to SDNet terminal for uploading IMEI numbers. Current Status: Pending Multi-company operations Fairdeal’s employees are specialized in one company operations only. Since there is only one computer operator and one Godown keeper in most of the companies. smooth operations of Fairdeal are disturbed when computer operator of Godown keeper is at leave. this issue was highlighted in Bharti Teletech when its computer operator Mr. Current Status: This suggestion has been partially accepted as scanning in beta testing phase has been done in Godown itself but scanning at time of receiving is still to be implemented. This consumes manpower as well as time in carrying the cases from one place to other. Recommendation: Formal training sessions should be arranged by experienced trainers arranged either by Bharti Teletech or Fairdeal.Location of barcode scanning in Bharti Teletech All Motorola cases have to be brought to SDNet terminal upstairs from Godown to scan their IMEI numbers. These sessions should be off-the job type as well as on-the job type. Sunil Patel resigned from the job. For example: uploading IMEI number using text files was there from beginning but operator at Fairdeal learnt it by trail and error only after one year of his tenure. Operations in such situations are handled either by process owner or by Mr. COO of Fairdeal.
encouraged and trained to behave courteously with channel partners (e. COO. Employees can be allotted to one company’s operations and one secondary companies working can be taught to him at the time of joining. Noting down serial numbers of bikes in TVS Motor When serial numbers and frame numbers of TVS bikes are noted down manually. Sales officer of Bharti Teletech and even Mr. Recommendations: Employees should be encouraged to learn handling multiple (at least two) companies’ distribution channels like SAP R/3 of TATA Tea and SDNet of Bharti. Employees should be motivated. Recommendation: Cordless barcode scanner can be used to scan serial numbers instead of doing it manually. in handling absent employee’s work. This will reduce human errors as well as increase efficiency of receiving and dispatching also.g. Sharad Jobanputra had to scan serial numbers himself. Manoj Banshilal Pachouri 176 ICFAI Business School .process owner. there are human errors in noting down numbers because of confusion in 0 & 8. New employees will learn better than those who have been working for a long time on single SD network. Current Status: Initiatives have been taken to impart multi-operational skills in employees. 3 & 8 which look similar when printed by dot matrix printer. This also happens because of scratches on barcode labels or insufficient lighting. there should be another employee in Fairdeal who is at least 80% efficient. For example: if one employee is absent or quits his job. if not more. TVS should ask SAP R/3 to provide them with integrating software which can transfer data to and from cordless barcode scanner and SAP R/3 module. This will ensure smooth operations even in case of absenteeism and job vacancies. Area Sales officer and Logistic peoples like truck drivers etc) as well as dealers and Stockists. Investing COO time or process owner’s time in such activities is not advisable for development of a company. Current Status: This issue has been communicated to TVS head office at Hosur and barcode scanners are soon to be implemented. Also. It has been seen that some employees lack courtesy and communication skills.
Also it does not have any protection grill which adds fuel to fire and bikes may fall anytime at time of taking them downstairs or upstairs. It is to be noted that this stairway. It is a time consuming process and costs Fairdeal in form of money and labor hours. bikes are brought downstairs when space is available.Damages in TVS Motor at time of Loading In TVS Motor. To prevent these damages. Company regulations of vehicle loading must be strictly followed according to which bikes are loaded by dragging them from handle. Further. Though these damages were sometimes claimed from outsourced labor contractor. Recommendation: To ensure proper loading of vehicles. a bike fell off the loading track and there was severe damage to both labor and bike. there are instances of damages to bikes at the time of loading. Recommendation: This Roof should have tin or cement shading which will ensure time saving in taking vehicle down and bikes will be secure against heat and water during rainy season. Current Status: Waiting for management’s approval Shading of TVS Godown Roof TVS Godown roof does not have any shading and vehicles are lying in direct sunlight even in scorching heat of Ahmedabad summers. is constructed at right angle. in TVS Godown. During one such loading. It is noted that sometimes bikes are loaded on transport vehicles by riding them. Direct heat in summer damage seats of bikes and shining of paint fades away. Recommendation: A new straight stairway should be constructed which should be properly grilled to avoid any accident. Current Status: Waiting for management’s approval Bring down TVS bikes from roof Stairway is used when bikes are required to bring down from roof or when it is required to take them to store on roof. measures should be taken to avoid these types of human errors. a lift can be used to substitute stairway. Current Status: Waiting for management’s approval Manoj Banshilal Pachouri 177 ICFAI Business School .
Hence if transporters can intimate 24 hours before arriving warehouse. Fairdeal can get arriving consignment from goods in transit module of SAP R/3. Suggestion: Transporters should be encouraged to intimate Fairdeal in advance about their arrival. Recommendation: These computers should be connected to each other through network connection. This will help Fairdeal in arranging for bikes space and avoid parallel unloading. Seniors are afraid of sharing information with juniors because they are afraid of loosing referent power over juniors. Preparation for space for goods in transit in TVS Motor Many a times. Current Status: Status quo Lack of group dynamics There is no group dynamics and feeling of team work among employees working for different companies. one for SAP R/3 operations and other for assistant works.Interconnectivity of computers in TVS Motor TVS division has two computers. it is not possible to get the exact date and time of arrival. My personal interview with warehouse staff and computer operators revealed that juniors are not getting co-operation form seniors. it will be beneficial for both transporter and Fairdeal. Current Status: Matter forwarded to management Manoj Banshilal Pachouri 178 ICFAI Business School . Bikes are only unloaded when some bikes are dispatched to dealers and space is created. it does not have any adverse effect on Fairdeal’s operations. Though. Lorries have to wait for a long time to unload bikes as there is no space in warehouse to store them. Suggestions: Information sharing should be encouraged in Fairdeal. Current Status: Both computers have been connected through LAN. it consumes transporter’s time and resources. As of now. data has to be transferred using Floppy disks from one machine to another. Although.
Moreover. chances of human errors are also there in taking down incorrect code. storing and maintaining it. This is a bottleneck as a lot of time is consumed in maintaining non-moving and unsalable material. Adding to it. Single person is handling computer operations as well as store for McFills. these scanned barcodes could be used at time of billing because presently computer operator has to punch all material codes manually at time of billing. This is a time consuming process as sometimes more than 10. these boxes are then opened and watches are verified for number of pieces per code.000 pieces are received in a single transaction. Current Status: Status quo Manoj Banshilal Pachouri 179 ICFAI Business School .Goods Receiving in Titan When material is received in Titan. boxes are weighted and verified against printed weights on boxes. This material consumes time in segregating material. Suggestions: Sales returns and unsalable material should be sent back to company as soon as possible. Also. Current Status: Discussions in progress with management Goods Returns in McFills There are more sales returns in McFills compared to any other company. Note: This is already being practiced in Bharti Teletech for Motorola mobiles. Recommendation: Box must not be opened and barcode scanner should be used to scan barcode labels which are printed on box itself. If weights are found normal. Though transaction volume is comparatively lower it is creating problems for customers as computer operator is not available when he is in store. These barcode labels will get the number of watches code wise.
Current Status: Status quo Speed of Internet Connections Bell Ceramics. Current Status: Discussions going on with principal companies Material Indentation in McFills Material is indented by Mr. At such times. MICO. It is not in position to implement VAT through its software. Suggestions: Fairdeal should ask these companies to implement broad band connections. There is severe problem in sending attachments to company administration also as uploading speed of internet is slow.Obsolete softwares in McFills and MRF Paints McFills and MRF Paints are using very primitive software which has erroneous entries. McFills data cannot be audited from software as most of the quantities are showing negative stock. Current Status: Status quo Manoj Banshilal Pachouri 180 ICFAI Business School . Though type of software to be used is decided by principal company’s management but since Fairdeal is paying for computer operators. computer operator has to wait for off-time when internet connection speed is relatively more. there is problem of uploading these files. cost of any erroneous transaction is bore by Fairdeal. Apart from that. For example: when file attachments of more than 2 mb are to be sent to McFills head office. Their online portals use utilities which require high speed broadband connection. Bharat in McFills which is responsibility of Area Sales Manager and not of CFA personnel. Recommendations: Fairdeal should communicate this issue with its principal companies. McFills and MRF paints are using dial up connections for information sharing. Suggestions: This activity can be annulled.
This process can be annulled if WMS can be implemented as most of the reports can be generated from it directly. It will reduce paper costs and processing times as well. Current Status: Management has taken up this issue with utmost priority and negotiations are in progress with WMS vendors.Unloading in Voltas and TVS Motors Voltas and TVS Motor trucks have to wait for unloading material in absence of required number of labors. Demo of WMS have been seen and WMS that fulfills company requirements would be implemented in 2006. this WMS can be extended to other locations of Fairdeal like Surat. In long run. Current Status: Mater forwarded to labor Incharge Implementing Warehouse Management System (WMS) Most of the operations of Fairdeal are executed manually which consume a lot of time and money. labor charges etc are prepared into Microsoft Excel sheets and printed. Recommendations: WMS should be implemented as soon as possible as it will automate most of the processes. Hosur. Dehradun and Bangalore also. Octoroi claims. Voltas and TVS Motor products require more than one labor for a single item. failing to which material can not be unloaded. a minimum number of labors are required to unload the truck. Moreover. Paper work is major mode of communication with dealers and principal companies which is again a time consuming and costlier process. re-packing. All divisions will be integrated and it will be possible to use data of one division in another. Recommendations: There should be preplanned arrangement of labors and storing space to avoid wait time. freight charges. processes of all principal companies are handled separately and there is no link between them because of which employees know operations of one company only. Reports of reimbursements for value added services like re-labeling. Manoj Banshilal Pachouri 181 ICFAI Business School . Since. Warehouse rents.
structure and processes Understanding process workflows Draw process matrices “AS-IS” Analysis Personal interviews of warehouse staff Complete “TOBE” Analysis Identifying Process Gaps Document findings of the project 01 Code of Immediate Predecessor Activity Start Date 13-02-06 Activity End Date 25-02-06 Deliverable work product Project Proposal Workflow notes Matrix charts Interim Report Interview Document Person Responsible Manoj Pachouri Manoj Pachouri Manoj Pachouri Manoj Pachouri Manoj Pachouri 02 20-02-06 27-03-06 03 04 05 02 01 01 21-03-06 26-02-06 08-03-06 28-03-06 03-04-06 10-04-06 06 07 08 04 04 01 03-04-06 12-04-06 27-02-06 02-05-06 06-05-06 07-05-06 Flowchart & Matrix Process Report Final Report Manoj Pachouri Manoj Pachouri Manoj Pachouri Manoj Banshilal Pachouri 182 ICFAI Business School .Project Activity-Time Schedule Table 34: Project Activity-Time Schedule Activity Code 01 Activity Description Study org.
Table 35: Gantt chart of Project Activity-time Schedule Activity Code 01 Week number 1 2 3 4 5 6 7 8 9 10 11 12 13 14 02 03 04 05 06 07 08 Manoj Banshilal Pachouri 183 ICFAI Business School .
Table 36: Organizational responsibility Activity Description Study organization structure and processes Understanding process workflows Draw process matrices Fairdeal Provided relevant documents None ICFAI Provided Basic Facility like Internet. Library. transportation Provided Suggestion Provided Guidelines Provided Microsoft Visio 2003 Provided AS-IS Analysis formats None Complete “AS-IS” Analysis Provided Relevant Data Personal interviews of warehouse staff Complete “TO-BE” Analysis Provided Employee Time Provided Inputs about benchmarked processes None Provided TO-BE Analysis formats None Identifying Process Gaps Document findings of the project Provided printing facility None Manoj Banshilal Pachouri 184 ICFAI Business School .
Raman Mr. Bharat Mr. Singh Mr. Anal Ms. Shabbir Mr. Sunil Patel Mr. R. Stuti Designation Chief Operating Officer (COO) Process Owner Process Owner Process Owner Process Owner Chief Accountant Computer Operator Computer Operator Computer Operator & Store Incharge Computer Operator Computer Operator Computer Operator Computer Operator Computer Operator Security Incharge Store Incharge Store Incharge Store keeper Security Guard Receptionist Manoj Banshilal Pachouri 185 ICFAI Business School . Hemant Thakkar Mr. Praveen Mr. Komal Mr. Vinod Ms. Mitesh Shah Mr.APPENDICES APPENDIX A: Key staff involved in the project Table 37: Key Staff Involved In the Project Contact Mr. Devadutt Mr. P. Vinod Mr. Mohan Mr. Narendra Mr. Tushar Mr. Zankar Mr. Saurabh Mr. Santosh Ms.
APPENDIX B: Fairdeal’s Document Formats Figure 24: Format of Gate Pass of Fairdeal Manoj Banshilal Pachouri 186 ICFAI Business School .
Figure 25: Format of Invoice
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Figure 26: Format of Advance Intimation of Warranty Return
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Figure 27: Format of Lorry Receipt (LR) of Fairdeal
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Figure 28: Format of Lorry Receipt obtained by Fairdeal
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Figure 29: Format of Warranty Replacement Delivery Challan
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Figure 30: Format of Warranty Return Delivery Challan
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APPENDIX C: Flowcharting Shapes Figure 31: Flowcharting Shapes Manoj Banshilal Pachouri 193 ICFAI Business School .
Sales and Distribution by Tata McGraw Hills publication 5. White paper DELIVERING RESULTS: EVOLVING BPR FROM ART TO 7.in) 2. 10. Mar 01.pdf: A Survey of the Third-Party Logistics (3PL) Service Providers in India by Subrata Mitra (subrata@iimcal. Fairdeal Distribution Services Pvt.The Hindu Business Line.berkeley. ENGINEERING by Richard J. White paper Business Process Analysis  by Bob Glushko (glushko@sims. 3PL is Growing . documents and manuals 3. Associate Professor of Department of Industrial Engineering Texas A&M University.D. Ph. iimcal_paper. SAP R/3 – Material Management by Tata McGraw Hills publication 6. Mayer. SAP R/3 .ac.REFERENCES Bibliography 1. Monday.. ICFAI Business School SAP R/3 study material 4. User manuals & catalogs of IntelliTrack Warehouse Management System software. 2004 Manoj Banshilal Pachouri 194 ICFAI Business School . Ltd. 8.edu) 9.
voltas. http://www. http://en. 5.com http://www.uct.com/ http://www. http://www. 7.pdf 21. 6.com.com/ 19.za/ 15.beetel-india.uk/pharma/docs/sup_chain/03_Phase% 202%20Report%201pasav2.htm http://www.com/ 20.tata.htm 10. 9.org. http://www. 3.uct.Internet Sources 1. 2.net/ 17. http://www.uk/webfiles/national/projects/Ryogen http://www.tatatea. http://www.gov.doh.com 11.com/ http://www. http://www.bestwms.localegovnp.org http://www.org/wiki/Warehouse_management_system/ 16.fairdeal.informationweek. 8.com http://www.ac. http://www.wikipedia.fairdealdistribution.pasa.web.logisticsfocus.com/titan/index. 4. http://www.titanworld.com/ 18. http://localhost/bs/ 14.1.lb Manoj Banshilal Pachouri 195 ICFAI Business School .mrf.com:9080/ 13.tata.intelliTrack.com 22.logisticsfocus. http://www.softwaredesign. http://www.com/voltas/index.com 12. http://web.about.ac. http://www.za/ http://www.
invoice is raised in case of credit purchase Business process: A business process is simply the series of steps or activities needed to convert some ‘input’ into the required ‘output’. Business Process Reengineering: It is a methodology for either significant improvement to a business process. It categorizes inventory by its highest value and greatest volume. Activity Based Costing: An accounting method that enables a business to better understand how and where it makes a profit. Barcode Scanner: An instrument used to decode information coded in parallel bars format and labeled to products. As-Is Analysis: As-Is Analysis phase of BPR is aimed specifically at identifying disconnects within existing business processes and their specified intent. With this information. inconsistency between the functions of a process that cause failings of the existing process to achieve its intent. inventory managers can focus on increasing those inventory SKUs with the greatest potential positive return for the organization. Manoj Banshilal Pachouri 196 ICFAI Business School . Only difference between invoice and bill is that while bill is raised in case of cash purchase.GLOSSARY ABC Analysis: ABC Analysis is an inventory management tool based on the tenets of Pareto Analysis. we mean anything that prevents the process from achieving desired results (e. or complete replacement of.) The steps taken to describe the AS-IS process also includes a documentation of the sequence in which activities are performed. Bar Code Labels: Labels that use bar code symbols to capture inventory information.. such a process. Bill: It is a printed document like Invoice which contains product specification along with its value. or for radical change in. By disconnects. These labels can be created within the WMS application or a separate bar code application.g.
It is generally raised when goods are sold on credit or when instant money transfer is not involved. Cross Docking: Cross docking enables an operator to place newly received inventory directly into a staging area. because it is the time that would pass on the calendar or clock on the wall during the cycle.Central Warehousing Corporation (CWC): CWC is under the Ministry of Food and Civil Supplies. or wall-clock time for shorter cycles. Cycle time: It is the total elapsed time. goods or articles utilizing the service of a person. Challan: Challan is a printed document containing description of products sold or transferred. to carry or accompany such documents. It is a stacking practice in warehousing non-durable products which aims at ensuring that material that is expiring first is dispatched first. good or articles. It is sometimes called calendar time. Enterprise Resource Planning (ERP): ERP Facilitates company wide information system covering all functional areas and performs core corporate activities and increases customer service augmenting corporate image. either directly or indirectly. Together. end to end. Courier agency: It is a commercial concern engaged in the door-todoor transportation of time-sensitive documents. It attempts to maximize productivity through restructuring and reorganizing the different divisions and departments in the organization FEFO: Abbreviation of First Expiry First Out.515 warehouses which are spread all over the country. from the time the cycle starts or is triggered until the cycle completes with all results accomplished. Manoj Banshilal Pachouri 197 ICFAI Business School . Cycle Count: It is regularly scheduled inventory count that cycle through inventory. Computerized Truck Routing: method of using computers to generate truck routes based on stop locations. as opposed to putting the item into a storage location. delivery appointments and backhauls. the CWC and the SWC have a monopoly in overseeing a network of 1. It is complemented by 16 State Warehousing Corporations (SWC).
predetermined items that are part of a kit are picked from inventory when the kit item number is selected as part of a pick order. Kitting: A ‘kit’ represents a preset group of items. It is a stacking practice in warehousing which aims at ensuring that material that is stored first is dispatched first. pallets improve inventory tracking and control efficiency when moving large amounts of material (same or unlike items) around the warehouse. product expired etc. Octoroi: It is a tax levied by Municipal Corporations of Metropolitan cities on goods purchased or used inside Municipal Corporation region. Pallet: Pallets provide an alternate storage area for inventory. if pallets are used. of varying quantities. or just because the process is designed that way. The work item is ready to go on. partially finished goods will stack up before a bottleneck machine during queue time. Invoice: Invoice is a printed document containing description of products sold along with their value. Manoj Banshilal Pachouri 198 ICFAI Business School . or because it has not been routed expeditiously. Because they are portable. perhaps because the work is not on a critical path. It is raised after challan and contains value of product also.FIFO: Abbreviation of First In First Out. it is possible to move large amounts of inventory at once. When the kitting process is used in the warehouse management system. Non Moving Material: Non moving material is that material which is not being demanded by dealers for various reasons including product becoming obsolete or out-of-date. These materials occupy a significant amount of space in the warehouse. Idle time: During idle time. In a manufacturing environment. the process is just waiting. but is waiting for the resources for the next step to get to it. Queue time: It is the time an item is lined up before a critical or bottleneck resource. Additionally.
Supply Chain Management: Supply Chain Management may be defined as "the integrated management of all linkages and value added activities from the supplier's supplier to the customer's customer in such a way that enhanced customer value is achieved at lower costs. Stock Transfer Memo: This document is used in transferring material from one location to another when change of ownership is not involved. it is a relatively new technology which uses chips embedded in products in conjunction with transmitters located across a logistics chain to determine the exact location of merchandise anywhere in the world. Staging Area: Area in the warehouse from which goods are shipped. manufacture. planning. Setup time: It is the time required for a resource to switch from one type of task to another. sales and disposal’. Slow Moving Material: slow moving material is that material which is in less demand in the market and inventory stock in warehouse is more than budged stock. Manoj Banshilal Pachouri 199 ICFAI Business School . When an item having RFID tag passes through electromagnetic zone of RFID. Invoice is used in transferring material when change of ownership is involved. distribution and purchases with the entire manufacturing process. distribution. Stock-Transfer: This is inter .distributor or inter – depot transfer of material in case of shortage of stock at one location to supply material to customers at time. This is also most obvious in a manufacturing situation—the operator might need to mount a different bit on a milling machine before beginning work on a new lot of a different product type. Supply Chain: supply chain may be defined as ‘Flow of materials through procurement. Supply Chain Management is interplay of all the functions and integrates marketing.Radio Frequency Identification: Known as RFID in short. an antenna captures the information from this tag and passes this information to central computer.
that is a step in itself. but no other value is being added other than transport. expired packets etc. damaged packets.SWOT Analysis: It is an analysis tool that forces decision makers to look their strengths. bundle. weaknesses. Warehousing: It is the part of materials management concerned with the storage of the kind and quantity of goods that consumers and users require. Its goal is to increase retail inventory turns and reduce stock outs. Vendor Managed Inventory: The practice of retailers making suppliers responsible for determining order size and timing usually based on receipt of retail POS and inventory data. Units of measure define a base unit of measurement such as each. work time and time worked are the same. Time worked: Time worked counts the actual work hours of work expended on the process. If only one person at a time works on the process. WIP: Work In Progress. which satisfy goals of the enterprise as stated in the business case analysis and which satisfy the change-requirements. Manoj Banshilal Pachouri 200 ICFAI Business School . To-Be Analysis: The goal of To-Be Analysis design is to produce one or more alternatives to the current situation. when the work is being moved. Strictly speaking. This term is used in manufacturing industry where raw material is in under the process of converting to the finished goods but is not yet completed. Unit of Measure: A unit of measure (UOM) allows measuring the amount of an item in a structured and distinct unit. Transit Time: It is the time spent in transit between steps. opportunities and threats associated with their business environments. Unsalable Material: This term unsalable material is widely used in FMCG goods and non durable goods. and then higher increments of the base unit such as carton. It consists of air-leaked packets. Sometimes more than one person (or other resource) is working on the process at a time: this measure would be the total hours paid for if workers are the resource being measured. and case.
Workflow: Workflow integrates the entire organization with flexible assignment of tasks and responsibilities to locations. cycle time and work time would be the same. if all this non-productive time could be eliminated. jobs. groups. or individuals. It integrates every employee in the 'value chain' by providing a versatile inbox (universal inbox) at his or her workplace. Work time: It is the time the process is actually being worked on. which can be configured individually.END OF REPORT --- Manoj Banshilal Pachouri 201 ICFAI Business School . --. positions. Most processes have at least some time during which processes are waiting and not being worked on.
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