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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
zeal. mentor and above all for his encouragement. so as to carry on the project work without any encumbrance.ICFAI Business School. severance. I would like to extend my warm salutations to Professor Ravi Warrior. steadfast determination and most of all encouraging guidance. Ltd. I sincerely thank Mr. Ltd. would be incomplete without the mention of the people who made it possible. Manoj Banshilal Pachouri iii ICFAI Business School . This project would not have been concluded successfully within time without their support and help. Ahmedabad. honorable Promoter and Managing Director of Fairdeal Distributors Pvt. So. Ltd. Rajkumar of Sequel Pvt. Sharad Jobanputra. 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.Acknowledgements The satiation and euphoric that accompany the successful completion of task. he bestowed every possible facility to me. for giving me value suggestions and advice throughout the execution of the project. and my project guide for guiding me as well as providing me the support to conduct this project. 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. Despite his demanding schedule. I thank him for being a constant source of inspiration. undeferred missionary. my Marketing faculty at Bangalore campus and Mr. success is the epitome of hard work. for his guidance and encouragement in getting this project. After all. I would like to express my profound sense of gratitude to Professor Bharat Kantharia . with immense gratitude. I acknowledge all those whose guidance and encouragement served as a “beacon light” and crowned my efforts with success. With a deep sense of gratitude and indebtedness. I sincerely and whole-heartedly thank my fellow colleagues and the staff team at Fairdeal Distribution Services Pvt.
Hemant & Mr. Pravin of Amara Raja Batteries. Late Shri Banshilal Pachouri and Ms. Manoj Banshilal Pachouri 05BS 1741 ICFAI Business School Manoj Banshilal Pachouri iv ICFAI Business School . Mr. Mr. 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. Mr. Narendra of TVS Motors. for bringing me up in a successful environment and teaching me all the basic etiquettes and ethics required for my growth in an organization. and my seniors who provided me with the study material on my project. Ltd. I thank my parents. Aashish of Titan watches. Dhanvanti Devi. Saurabh of Voltas. I take this opportunity to thank all the library members of ICFAI Business School. Last but not the least. friends. Mr. Ahmedabad. Mr. Zankar. Mr. Sunil Patel of Bharati (Motoroala).I would be selfish if I do not mention names of Mr. Vinod of Tata Tea.
Foods and snacks industry. 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. At the Fairdeal. Some of the companies I studied in these industries are Titan. It was always my dream to work on an ERP and BPR project in my SIP and Fairdeal provided me this opportunity. 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. Horology industry. Tanishq.Me @ FAIRDEAL I am among the few professionals who are privileged to get their dream project. Pawas Agarwal. McFills foods. Amara Raja Batteries etc. Manoj Banshilal Pachouri v ICFAI Business School . Bell ceramics. MRF paints. Tata tea. Mr. BPL Sanyo. Though the time was clearly sketched out to me. Electronic home appliances industry. Telecommunications industry and Paint Industry. My Interaction with Area Sales Managers (ASM). Bharati Teletech. Around four month of my work exposure gave me tremendous insights into the companies operations. Fairdeal’s staff was also equally capable with industry experience in range of two to ten years. I was given complete freedom with the style of working. I got the opportunity to understand the supply chain and logistics operations of many industries namely. dealers. Motorola. Automobile industry. MICO Bosch. TVS Motors. Planning Scheduling and deadlines are a part of every working individual and that’s exactly what was expected of me. Voltas. I also got opportunity to spend some time with Mr. Working with the Fairdeal I have been able to understand some of the best logistics and clearing & forwarding industry practices that they follow. Tata tea regional manager for west zone during my project. Fairdeal’s management and staff was not less than a gurukul for me. In a very systematic manner training was offered to me. Apart from external industry exposure.
During entire internship period I was asked to report at the end of every phase that I complete. This will steer me to make myself competent enough and excel in whatever I do. This enhanced my knowledge to great extent and triggered in me the curiosity to know more on the subject. Ltd. it was a knowledge enhancing and curiosity quenching experience that will linger in my heart. The prospectus of association with Fairdeal Distribution Services Pvt. These reports covered my basic understanding of the issue and then methodology that used for the analysis. Manoj Banshilal Pachouri vi ICFAI Business School . is always near to my heart. In short.
.................................................. 29 ABOUT FAIRDEAL ............. 32 Directors ............................................................................................. 25 Warehousing.......................................................................... 9 Detailed tasks to be performed .......................................................................................................................................................................... 34 Locations....... xi Acronyms and Abbreviations. 6 Scope of the project .................................. 6 Objectives of the Project ............................... 8 Proposed Methodology......................................................................... 19 Third Party Logistics Industry: SWOT Analysis ........................... 37 Manoj Banshilal Pachouri vii ICFAI Business School ............................................................... i DECLARATION ...................... 25 Vendor Owned Inventory Management ............... 15 INDUSTRY ANALYSIS ......................... 31 History ......................Table of Contents CERTIFICATE ........................................................................................................................... iii Me @ FAIRDEAL................................................................................. 16 Legal Issues in Logistics Industry........................................................................... 36 Awards and Achievements ........................................ 16 Logistics Industry ............................ 7 Limitations of the Study................................................. 26 Reverse Logistics (Returns Management) .............................................................................................. 24 In-plant Stores Outsourcing ...................................................................................................................................... x List of Tables.. ii Acknowledgements ..................... 32 Independent Directors ......................................... 18 Third party logistics .......................................................................................................................................................................................... 11 Project Schedule................................................. 1 Executive Summary ................................................................................................. v Table of Contents....................................................................... 33 Business Focus ................................................................................. 35 Distribution Network ....................... 23 Fourth Party Logistics (4PL) Industry..... 26 Material Handling ....... 27 Clearing and Forwarding Agents ................................................................................................................................................................................................... 34 Product Range.. xii Abstract................ Mission and Business Objectives ...................................................................................................................... 3 INTRODUCTION .............................................. vii List of Figures............................ 30 Vision.................................................................................
................................................................................................................................ 99 Cycle Time. 56 Company Wise Processes ............................................................................................................................................. 95 Definition of AS-IS Analysis......................................................... 126 Handling Unsalable Material Process ............ 41 Amara Raja Batteries Limited (ARBL) .......... 123 Transportation Process .. 141 Preparation for Implementing Re-Designed Processes ................................................................... 103 Goods Receiving Process............... 100 Process Matrices [Key Performance Indicators (KPIs)]............................ 54 Organization Structure of Fairdeal....................................... 96 Decide on an approach ................................................................................................................................ 48 Bharti Teletech..... 138 Other Notes from Interviews ..................................................................................... 91 AS-IS ANALYSIS ....... 81 Definition of ABC Analysis .......... 44 Motors Industry Company Limited (MICO).............. 108 Cycle Count Process ................................................................................................................................... 51 PROCESS ANALYSIS ............................................ 57 ABC ANALYSIS ................................................................................................... 37 Voltas ...................................................................................... 104 Storing Material Process .......... 143 Assembling Warehouse Data ................................................................. 118 Invoice/ Bill Printing/ Stock Transfer Process ............. 121 Dispatching Process ................. 87 Transactions Wise ABC Analysis ............ 140 TO-BE ANALYSIS ... 129 Handling Warranty Claims Process ....................................... 54 Sources of Data Collection ..................................................................................... 144 Manoj Banshilal Pachouri viii ICFAI Business School .......................................................................................... 115 Order Approval Process .......... 134 Initial Issues Emerged Out Of AS-IS Analysis.................................................. 43 TVS Motors........ 83 Quantity Wise ABC Analysis.............................................. 143 Warehouse Layout ..............................................................................................Client Companies..................................... 132 Stock Maintenance Process .......................................... 49 MRF Ltd ... 82 Value Wise ABC Analysis......................................................................................................................................... 46 Bell ceramics ............ 112 Order Punching Process ...................... 53 Processes and the Organization ..................................... Wait Time measurements ........ 55 Remuneration claimed by CFA ....................................................................................................... 39 Tata Tea ..................................... 37 Titan Industries ............................................................................................................................................................................................................
..................................... To-Be Warranty Claims & Unsalable Material Process ................... APPENDIX A: Key staff involved in the project ........................................................................................... Import-Export Data To and From WMS ..................................................................................... To-Be Invoice/ Bill Printing/ Stock Transfer Process ............................................................. APPENDIX B: Fairdeal’s Document Formats ... To-Be Cycle Count Process .............. To-Be Goods Receiving Process.................. Synchronize Fairdeal WMS and Principal’s ERP Module .................................................... Project Activity-Time Schedule.... APPENDICES ........................... To-Be Order Approval Process .............................................................Specifying the Replenishment Sequence ... APPENDIX C: Flowcharting Shapes ................. GLOSSARY ............................................................................... To-Be Order Punching Process .................................... SUGGESTIONS AND RECOMMENDATINS... To-Be Transportation Process ............................................................. Bibliography....... Implementing Location Sequencing .. To-Be Dispatching Process ............................................................... Generating Barcode Labels........................ To-Be Storing Material Process .......................................................................... TO-BE Stock Maintenance Process..................................................................................................... REFERENCES ......................................................... Internet Sources..... 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 ................................................. Suggestions and Recommendations..........................................................
.... 191 30: Format of Warranty Return Delivery Challan ..... 192 31: Flowcharting Shapes ................ 117 8: Flowchart of Order Approval Process .............................................. 168 24: Format of Gate Pass of Fairdeal ............. 153 18: Flowchart of TO-BE Cycle Count Process ........... 133 14: Flowchart of Stock Maintenance Process............. 189 28: Format of Lorry Receipt obtained by Fairdeal .......... 190 29: Format of Warranty Replacement Delivery Challan ........................... 131 13: Flowchart of Handling Warranty Claims Process............ 137 15: Warehouse Layout .......... 28 3: Organization Structure of Fairdeal.. 188 27: Format of Lorry Receipt (LR) of Fairdeal .... 114 7: Flowchart of Order Punching Process ...................................................... 111 6: Flowchart of Cycle Count Process ....................... 160 21: Flowchart of TO-BE Dispatching Process ....... 164 23: Flowchart of TO-BE Stock Maintenance Process ...... 9 2: Reverse Logistics Cycle ....... 193 Manoj Banshilal Pachouri x ICFAI Business School ......... 120 9: Flowchart of Invoice/ Bill Printing/ Stock Transfer Process 122 10: Flowchart of Dispatching Process ........ 158 20: Flowchart of TO-BE Invoice/ Stock Transfer Process.. 162 22: Flowchart of TO-BE Transportation Process............................ 107 5: Flowchart of Storing Material Process ...................................... 151 17: Flowchart of TO-BE Storing Material 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 ....................................................................... 155 19: Flowchart of TO-BE Order Approval Process ........... 144 16: Flowchart of TO-BE Goods Receiving Process .................................................................................................. 128 12: Flowchart of Handling Unsalable Material Process ................................................ 187 26: Format of Advance Intimation of Warranty Return ............ 125 11: Flowchart of Transportation Process ........... 55 4: Flowchart of Goods Receiving Process..................................... 186 25: Format of Invoice ....................
.... 100 9: Loading & Unloading times in TVS (With four labors) ................................................................................... 90 7: ABC Analysis ..... 132 23: Stock Maintenance Process... 23 3: Product Range of Fairdeal .............................. 127 21: Handling Unsalable Material Process .................................... 121 19: Dispatching Process ............................................................................. 102 12: Summary of Metrics ........................ 167 34: Project Activity-Time Schedule..................................................................... 103 13: Goods Receiving Process .............................................. 15 2: SWOT Analysis of 3PL Industry ...... 150 27: TO-BE Storing Material Process .................... 116 17: Order Approval Process................... 159 31: TO-BE Dispatching Process .................................... 136 24: AS-IS Analysis -Important issues with priorities ..............Transaction Wise ...................................................................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........................... 119 18: Invoice/ Bill Printing/ Stock Transfer Process ......... 101 11: Fairdeal’s Unloading times.............. 152 28: TO-BE Cycle Count Process .. 130 22: Handling Warranty Claims Process................................................. 59 5: ABC Analysis .. 182 35: Gantt chart of Project Activity-time Schedule ....... 106 14: Storing Material Process................ 161 32: TO-BE Transportation Process........................................ 163 33: TO-BE Stock Maintenance Process ......................................................................................................................... 124 20: Transportation Process ..................... 154 29: TO-BE Order Approval Process ...................... 138 25: Example of Location Sequence Numbers ............................................................. 86 6: ABC Analysis ..............Quantity Wise ................... 94 8: Unloading times of Transport Vehicles .......................... 157 30: TO-BE Invoice/ Bill Printing/ Stock Transfer Process..............Value Wise .................................................... 110 15: Cycle Count Process ................. 113 16: Order Punching Process ............................................................. 184 37: Key Staff Involved In the Project.................. 185 Manoj Banshilal Pachouri xi ICFAI Business School ............................. 146 26: TO-BE Goods Receiving Process ................................... 183 36: Organizational responsibility ..................................... 34 4: Some examples of Titan watches ........................ 101 10: Ideal Unloading times (with four labors).........................................
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.
These alliances are also known as logistics or supply chain outsourcing and contract logistics. total eighteen processes and sub-processes were short-listed for detailed study. ten processes were selected for AS-IS Analysis phase which included Goods receiving. In the next phase. 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. Ltd. Transportation. Order punching. After thorough discussions with Fairdeal’s management and on the basis of need analysis. Storing. Project took off with studying all the processes being carried out at Fairdeal warehouse. Cycle Count. This is also known as Clearing & Forwarding. These processes were benchmarked with best practices of warehousing and clearing & forwarding industry. Organizations have developed strategic alliances with 3PL companies all over the world to manage their logistics operations network. At the same time. Handling unsalable material and Handling warranty claims. by implementing an Enterprise Resource Planning (ERP) Warehouse Management System (WMS) Module. Some activities were acting as bottlenecks and needed restructuring. Invoice [refer to format of Invoice in APPENDIX B] printing. Dispatching. Order Approval. 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. Manoj Banshilal Pachouri 1 ICFAI Business School . TO-BE Analysis was taken up for eight processes which required re-engineering.Abstract More and more organizations worldwide want to develop products for global markets. out of which. One of today's trends to solve this problem is outsourcing logistics or using third-party logistics (3PL) to manage complex distribution requirements. Result of AS-IS Analysis revealed activities in certain processes were not at par with industry standards and needed improvement. they need to source material globally to be competitive.
dependency on specific employee will decrease. I studied during this project are Intelliwms from IntelliTrack etc. A detailed process restructuring plan was made and recommendations were given to Fairdeal’s management. Efficiency of processes will increase. Fairdeal’s staff should develop cross-functional and cross-company knowledge of different softwares and packages. 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. Manoj Banshilal Pachouri 2 ICFAI Business School . Each employee should have knowledge of at least two softwares. Pre-plan the arrival of Goods-In-Transit and keep the space ready for arriving material. location codes and quantity. This would reduce errors in times of absentees and attritions. • • • It is estimated that these recommendations after being implemented will enhance operations of Fairdeal to a great extent. 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.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. Some of WMS softwares. This pick slip will include item codes. cycle time of orders will decrease and space utilization will also increase.
(www. I was assigned the task of doing Business Process Re-engineering which helped the company improve efficiency of its business processes. Ltd. my learning in classroom. with Fairdeal Distribution Services Pvt. Manoj Banshilal Pachouri 3 ICFAI Business School . especially classes of ITM and Operations Management. I am Manoj Banshilal Pachouri*. This project was so closely related to these two subjects that I had to implement most of my learning in Supply Chain Management. Sharad Jobanputra who is founding promoter and managing director of Fairdeal Distribution Services Pvt.P. How did I apply my learning at IBS? During this project. All the employees and some customers of Fairdeal were indirectly (but very closely) involved. Ltd.fairdeal. Team Constitution: This project was solely undertaken by me under guidance of company guide Mr.I.Executive Summary Hello. Findings and recommendations of this project were very useful during implementation of Warehouse Management System. Bharat Kantharia. I did my S.org) from February 13th 2006 to May 20th 2006. proved to be very useful. Cycle times. A copy of report was submitted to faculty guide Mr. Bharat Kantharia as well as top management of the company. Sharad Jobanputra and faculty guide Mr. 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. Enterprise Resource Planning etc.
0 for surfing internet WinZip 9.0 for archiving files Manoj Banshilal Pachouri 4 ICFAI Business School . 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. business communication skills.0 for editing images Adobe Acrobat 7. group dynamics. time management and corporate ethics. This project also developed my professional personality by teaching me team building. 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.0 for writing data on Compact Disk (CD) Adobe Photoshop 6.0 Professional for converting word document into PDF format Adobe Acrobat 5. negotiation skills.This resemblance between SIP project and my learning at IBS helped me completing this project without much hurdles and with in given time limit. 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.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.
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 .
existing process maps. 4. operational plans. measure baseline KPIs. Analyzing. organograms. carry out gap analysis (skills. Put new organizational design in place.These four phases will include Studying. and hand over to line management. draw-up opportunity charts for benefits. carry out training. Mapping. set up Service Level Agreements (SLAs). Redesigning and Implementing the various processes of Fairdeal Distribution Services Pvt. establish benefits targets. develop high-level problem hypotheses. Ltd. Design the "TO-BE" process. 2. benefits tracking). Implement. and develop implementation plans. Document the "AS-IS" process. 3. establish performance measurements (KPIs. revise the process flows and define any additional interventions required. costs). establish Key Performance Indicators (KPIs). refine the problem hypotheses. validate benefits. do micro-organization design. 5. Description of various phases is as follows – 1. do initial data gathering (e. performance measures). define roles and responsibilities (RACI).g. 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. Manoj Banshilal Pachouri 10 ICFAI Business School . Define the process and establish its boundaries.
• • • • • 3. • • • • • 4. • • • • 2. • • • • 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.
• • • • • • • 7. queue time. 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. • • • • 8. process time. 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. • • • • 6.5. and wait time • Identifying value-adding activities Manoj Banshilal Pachouri 12 ICFAI Business School .
9. Process maps and the level of detail • Macro level flow chart • Functional-activity level flow chart • Task and procedural level 11. • • • • • • 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. 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. 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 .
Preparing a document which will capture all the processes of Logistics. Integrating all the data collected and preparing a knowledge bank. Warehousing and Material Management.To complete above mentioned tasks other activities that will be performed will include Collecting the artifacts regarding the Logistic and Warehousing. Preparing process flowcharts and maps and finding out processes that need to be redesigned. Proposing recommendations based on the findings of the project. Personal interviews with warehouse staff. Manoj Banshilal Pachouri 14 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. 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 .
INDUSTRY ANALYSIS Logistics Industry Logistics is a part of supply chain and is defined as "the process of planning. effective flow and storage of raw materials. 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 . in-process inventory. implementing and controlling the efficient. Logistics is also defined as time related positioning of resources. 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. out bound. internal and external movements) in order to satisfy customer's requirements. services and related information right from the point of origin to the point of consumption (including inbound. 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 . in all the case the architecture of the chain would include the following three elements . In all the activities there is a flow of goods whether it is raw materials or WIP or semifinished goods or finished goods.System. Logistics plays a significant role in the management of entire supply chain. For example: In a manufacturing industry. 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. Relations. Technology.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. But.
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. Local Taxes: These taxes include local sales taxes. Also. minimum of 8. Material can be insured against fire up to dealer’s point or up to CFA point. Fire Act: Insurance claims and damages due to fire come under Fire act.33 % of annual salary of worker has to be awarded as bonus. Sanctions from appropriate bodies: There are many central and local bodies whose permission is required to carry out logistics operations. road taxes etc. Logistics. every logistics provider will have to comply with distribution and transportation industry regulations. This tax varies on product to product basis. Warehousing and Clearing & Forwarding. 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 . Octoroi taxes. Municipal Corporation are some of the examples. Labor Acts: According to these acts. not pollute the • • • • • Industry Act: Being in distribution and transportation industry.Legal Issues in Logistics Industry There are some legal issues involved with the operations of Supply Chain. Transporter’s unions. minimum wage has to be given to every labor under Wages Act. Pollution Act: Logistics activities should environment which may harm social set up.
in which transportation is a major element in the entire chain. services and related information.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. • • Manoj Banshilal Pachouri 19 ICFAI Business School . 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. 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. implementing and controlling the efficient. finished goods. in-process inventory. with no long term contracts and no bonding between the 3PL and the outsourcing company. Strategic Outsourcing: Based on long-term relationships with successful outcomes. Third party logistics Third party logistics is the activity of outsourcing activities related to Logistics and Distribution. The 3PL industry includes Logistics Solution Providers (LSPs) and the shippers whose business processes they support. 3PL companies become partners in supply chain management and establish transactional transparency. Level of outsourcing of in-plant logistics and third party logistics is mainly of following types: Levels of Outsourcing • Transactional Outsourcing: Based on transactions. effective flow and storage of raw materials.
supply chain expertise and economies of scale. To Share Responsibility: 3PL companies can share responsibility for managing global supply chains. keeping customers and stores properly stocked. Sales tax filing. 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. For more professional and scientific approach to logistical problems: Logistics outsourcing reduces problems arisen of truck accidents. and delivering the perfect order every time. 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. reverse logistics etc which can be handled by 3PL very efficiently. transportation. Insurance claims. another organization within the supply chain may be able to do it better.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. Resource constraints: In-house logistics and supply chain management requires heavy investment in infrastructure. warehousing and IT resources which might not be possible for a medium sized or small sized company. • • • • • • Manoj Banshilal Pachouri 20 ICFAI Business School . 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. simply because its relative position in the supply chain. Because Someone Else Can do it Better: Even if you have resources available. 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.
with the market likely to grow at a CAGR of 6. incorporating value-addition in their services and customizing their supply chain management solutions. At present. especially in the automotive. by 2020. 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. 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 $13.2 per cent during the next five years. metal.46 billion in 2003. In fact. According to industry sources. competitive pressure. 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. with more than half the goods in India being moved by road. IT hardware and FMCG companies are the major users of 3PL services.4 per cent during the next five years. against 9 per cent of GDP in the US. cement and textiles were identified as the top five contributors to the revenues of the logistics industry. Chemicals. The transportation cost accounts for nearly 40 per cent of the cost of production. For example: Gati is planning to add new services in its portfolio. Indeed. with the growth being fuelled by the entry of MNCs and export focus of Indian companies. the automotive. The market for 3PL services is likely to grow at a CAGR of 20. FMCG. 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 2003.3PL Is Growing THE Indian logistics industry is poised for a significant growth in the coming years as new companies. pharmaceutical. and manufacturing and FMCG sectors are increasingly opting to outsource their logistic requirements to specialized service providers. Industry analysts say that the key drivers for logistics outsourcing are the corporate trend of focus on core operations. increasing global trade and MNCs investments in India. In India the logistics costs are still higher than in the developed markets — it is estimated to be around 13 per cent of GDP. Third party logistics service providers in India are gearing up to meet the growth demand. Manoj Banshilal Pachouri 21 ICFAI Business School .
inbound warehousing. especially as it is facing the challenges of exacting delivery requirements and multiple export markets. Manoj Banshilal Pachouri 22 ICFAI Business School . Realizing the potential in the outsourced logistics market. the retail industry is expected to jump into the 3PL bandwagon. fleet management. labeling and packaging. 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. The logistics firms are also focusing on related services such as customer clearing and forwarding. Also. Analysts say that with large retailers such as Wal-Mart and Target seriously evaluating new suppliers for textiles in India. order picking and inventory management. Source: The Hindu Business Line Achieving Strategic Outsourcing Unfortunately.One sector that is increasingly looking for outsourcing logistics is textiles. this sector is bound to outsource logistics in the coming years. only a few 3PL companies achieve strategic status with their customers. Some use an open-book costing method to demonstrate their system's transparency. with such large retailers as Shoppers Stop and RPG expanding to smaller cities. They do it by constantly innovating and maintaining operational integrity.
• • • • • Manoj Banshilal Pachouri 23 ICFAI Business School . Threat of leakage of operational competencies to competitors. • THREATS Value Added Tax (VAT) might effect 3PL industry as distribution channels would be trimmed. Poor transportation infrastructure of India might lower the profit margin E-Commerce is emerging as a primary threat to 3PL industry. Lesser co-ordination between branch offices and 3PL agency. Difficult to switch 3PL provider agency. 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.
taking special care to consider the dimension of human resources and organizational change. customer support and supply chain technology. T&D. the overall business strategy is aligned with supply chain strategy to reengineer the supply chain of the participants. Step II: Transformation Here the focus is on coordinating specific supply chain functions such as sales and operations planning. etc. Step IV: Execution A 4PL provider's scope of responsibility also includes operational responsibility for numerous supply chain functions. distribution management. A standard 4PL supply chain solution involves four distinct steps: Step I: Reinvention At this level. 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. Manoj Banshilal Pachouri 24 ICFAI Business School . as applicable. capabilities. with the aid of process and organizational changes. procurement strategy.Fourth Party Logistics (4PL) Industry Fourth party logistics provider is a supply chain integrator that assembles and manages the resources. information technology. besides the traditional transportation management and warehousing operations logistics outsourcing. and technology of its own organization with those of complementary service providers to deliver a comprehensive supply chain solution to the client.
• Vendor Owned Inventory Management With multiple supplier having different locations and lead times. VOI works on a pull based system. along with tremendous flexibility and improved efficiency Manufacturers can then focus and allocate their resources on specialized areas like production. Some of the benefits of In-plant stores outsourcing are: • • • Focused & dedicated approach to stores function by skilled & experienced warehouse personnel.In-plant Stores Outsourcing The in-house/in-plant stores activity is managed by a 3rd party logistics provider (3PL). timely feeding to the production line can be done Your Supplier benefits by reducing his warehousing space. Some of its benefits are: • • • • Reduced inventory holding cost. with clear & measurable objectives and targets. as it is directly linked to 3PL’s revenue Specialized labor management model gives substantial cost reduction in terms of labor cost. 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 . where the stock ownership to manufacturer happens only when it is required to be produced. it is becoming increasing costly for manufacturers to ensure timely inputs to production lines. Design & Development etc. 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.
semi-finished goods. In inbound logistics terms. Manoj Banshilal Pachouri 26 ICFAI Business School . value-adding competitive tool. 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. materials handling serves company plants in the same way. Firms need to integrate materials handling requirements not only for the company's departmental needs. but also for meeting their customers' needs. For efficient movement of goods into the warehouse. or finished goods for varying periods of time. accurately filling orders. materials handling is very important to outbound logistics. This warehousing function continues to be increasingly important as companies and industries use customer services as a dynamic. industrial goods and finished products. locating stock. There are as many as 700 organizations in India engaged in the business of clearing and forwarding. and rapidly preparing orders for shipment to customers. 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. It creates time utility for raw materials.Warehousing A warehouse is a point in the logistics system where a firm stores or holds raw materials. The proximity of market-oriented warehousing to the customer allows a firm to serve the customer with shorter lead times.
in-process inventory." As far as managing the returns are concerned companies re-use them. finished goods and related information from the point of consumption to the point of origin for the purpose of recapturing value or proper disposal. Though reuse of products and materials is a common phenomenon. However. re-sell them. But companies are more likely to benefit if they can also make use of the information that comes back with returned merchandise. 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. known as reverse supply chain or backward supply chain. Efficient reverse supply chains bring many benefits to the companies. where soft drink bottles are returned and reused repeatedly The Council of Logistics Management defined reverse supply chain as "The process of planning. implementing and controlling the efficient. Manoj Banshilal Pachouri 27 ICFAI Business School . cost effective flow of raw materials. However.Reverse Logistics (Returns Management) Companies spend more time and money in fine-tuning their forward supply chains while ignoring their backward supply chains. leave them to a third party or destroy them. companies can no longer ignore reverse supply chains. in today's competitive business environment when there is both external and internal pressure. 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.
obsolete equipment disposition. restock. excess inventory and recycling programs. recalls. salvage. processing returned merchandize due to damage. Manoj Banshilal Pachouri 28 ICFAI Business School .Figure 2: Reverse Logistics Cycle Reverse logistics also includes remanufacturing and refurbishing activities. hazardous material programs. and asset recovery. seasonal inventory.
(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." Normally. 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. 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. o The above two constitute the remuneration or commission paid to the C&F agent by the principal. either directly or indirectly. This is usually given as a percentage of the turnover. who is engaged in providing any service. in any manner to any other person and includes a consigning agent. (e) Maintaining records of the receipt and dispatch of goods and the stock available at the warehouse. (f) Preparing invoices on behalf of the principal. 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. connected with clearing and forwarding operations.Clearing and Forwarding Agents "Clearing and forwarding agent" has been defined as "any person. A variable commission based on performance which is computed on the performance indicators agreed upon between the agent and the principal. (c) Receiving dispatch orders from the principal. For their services rendered. (b) Warehousing these goods. Manoj Banshilal Pachouri 29 ICFAI Business School .
infrastructure and intellectual property for the management. Republic of India (hereinafter referred to as ‘Fairdeal’ which expression. it was decided in March 2004 to widen the scope of service offering and move up in value chain. Currently..warehouses and vehicles . expertise. well laid warehouse of over 50000 sq ft at Sharkhej in Ahmedabad. experience. Gujarat. Fairdeal has a modern. 3000 Crores and has employee strength of over 300 and also handles secondary movement for which have over 25 dedicated vehicles. 2004. efficient and reliable services. Ahmedabad. Bopal-Ghuma Road. in addition to Watch Division of Titan Industries.to provide effective. Ltd. Hosur (Tamilnadu) and Dehradun (Uttaranchal) to Sequel Logistics. was established. Fairdeal has represented that it has the requisite knowledge. a company incorporated and registered in 1975 under the Companies Act. On 1st April. Keeping in mind the globalization of the industry and international trends. Today. 1956 and having its Registered Office at 431. Fairdeal has invested heavily in infrastructure . TVS Motor. Madura Garments. and Precision Engineering Division of Titan Industries. Manoj Banshilal Pachouri 30 ICFAI Business School . Ltd.ABOUT FAIRDEAL Fairdeal Distribution Services Pvt.000 SKUs at 5 different locations. Fairdeal manages over 40. For this purpose Sequel Logistics Pvt. maintenance and administration of all operations in Supply Chain Management Industry. Gujarat. resources. Material handled by the group is valued at over Rs. unless repugnant to the context or meaning thereof. It is handling inbound logistics for diamond for Titan Industries from Surat. 380058. It has a dominating presence as a ‘Clearing & Forwarding Agent’. BPL Sanyo. shall mean and include its successors and permitted assigns). technical know-how. Titan Industries outsourced In-plant Logistics to both their plants. And today our client list includes Ashok Leyland. Chetan Society.
to achieve highest level of efficiency.Vision. inventory management. 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. by offering innovative. Mission and Business Objectives Vision To constantly innovate. build and deliver superior supply chain solutions. Transparent & Ethical Manoj Banshilal Pachouri 31 ICFAI Business School . speed and profits Mission To be the most preferred Supply Chain Solution Provider in India.
• S Rajkumar He is a mechanical engineer and has done MBA from IIM-C. the firm started FMCG distribution and was associated with The Tata Oil Mills Co. 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. He has worked in Supply Chain Department of Titan Industries and worked with Madura Garment as Supply Chain Manager.. The firms were into retail distribution of 'Fast Moving Consumer Goods' for many years. Directors • Sharad Jobanputra He is a science graduate in microbiology and has 30 years of experience in various businesses and founder of Fairdeal Group.History The first Group firm was established in 1975 and was carrying out business in office equipments. In 1978. Manoj Banshilal Pachouri 32 ICFAI Business School . Ltd. Since then Fairdeal has grown to become a major 'Logistics Service Provider' in Gujarat and represents over twelve clients in the state of Gujarat. It also manages secondary freight for the clients. Colgate-Palmolive etc.
He has published several books and papers in national and international publications. India & China. Madras. • Jamshed Daboo He is a mechanical engineer and an MBA from XLRI. Japan & Nigeria. Jamshedpur. India. He will be CEO-FMCG Vertical. He is also a visiting faculty to national and international business schools. Manoj Banshilal Pachouri 33 ICFAI Business School . He has wide experience of working with Titan Industries and Tata Quality Management Services and currently he is COO – Business Hotels. Indian Hotels. He teaches Operation Research in IIMA and has special interests in Supply Chain & Logistics. Reliance Retail from June 2006. These independent directors will give Fairdeal group outside view as Fairdeal grows in terms of geographical scope and physical scale. an MBA from IIMA and a doctorate from Kellogg School of Management. Procter & Gamble.Independent Directors • Ninu Khanna He is a science graduate and an MBA from IIM-C. Dabur and currently he is Managing Director of Bombay Dyeing. • G Raghuram He is an electronics engineer from IIT. He has a very wide experience of working with Colgate-Palmolive.
Auto Batteries. Industries Paints and other Coating Products. Audio. Video. Auto Filters. Telecommunication. Coffee. Processed Food Products. Consumer Electronics. 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. Breakfast Cereals.Floor & Wall Consumer Durables Construction Material Manoj Banshilal Pachouri 34 ICFAI Business School . Vegetable Oils. provides complete Supply Chain solutions to its clients. Vanaspati. Power Transmission Systems. Ltd. Watches. Auto Electricals. Auto Bulbs. Industrial Electricals. Jewelry Ceramic Tiles . Spark Plugs.Business Focus Fairdeal Distribution Services Pvt. Mobile Audio Systems. Domestic Appliances. Automobile Lubricants. Lighting.
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 .
DTDC. Patel roadways. Shivraj Roadlines. 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 . Transport Corporation of India. Indo Arya Central Transport Ltd. Logisys India Limited. At present Fairdeal Distribution Services Pvt. Local orders are dispatched through company’s own vehicles and up-country orders are dispatched through its business partner carriers and courier services. AS Transport. Some of transporters and courier service providers carrying dispatching orders of Fairdeal are Gati. and Sai transport Agency.Distribution Network Fairdeal has a strong distribution network all over India. It has its own transport vehicles as well as it has business contract with other transport carriers also. Ltd. BlueDart. Unifreight.. prasanna cargo.
Lighting Trophy by Philips India Limited. ventilation and air conditioning. installation and servicing of technology based systems. Most trusted name in mining and construction equipment. Client Companies Fairdeal Distribution Services Pvt. two brand in air conditioners. Manoj Banshilal Pachouri 37 ICFAI Business School . refrigeration. Premier Player in machine tools. is Clearing & Forwarding Agent for following companies whose brief corporate profile is given below: Voltas Established in 1954. building management systems. The company's strengths lie in the design and manufacture of industrial equipment. textile machinery.Awards and Achievements • • Awarded Model Warehouse status by Hindustan Lever Limited. No. mining and construction. Leader in textile machinery. Largest projects exporter in Mechanical. Awarded Best Run Depot of the Country trophy and Best Customer Service . the management and execution of airconditioning and public work projects. It offers engineering solutions for a wide spectrum of industries in areas such as heating. Leader in forklift trucks. All these capabilities are ISO 9001-2000 certified. Ltd. water management. and in being a representative of global technology leaders. machine tools. the procurement. Electrical and Public Health works. materials handling. pollution control and chemicals. Voltas is India's premier air conditioning and engineering services provider. climate control. Voltas is: Leader in air conditioning projects.
Voltas has factories at Thane (Maharashtra). Lucknow. while the overseas offices are located in Abu Dhabi (UAE). New Delhi and Chennai. resulting in consistently high quality and reduced costs. and Sanathnagar (Andhra Pradesh). Kolkata.com/ voltas/media/index. commercial refrigerators. These products bear the stamp of state-of-the-art automated manufacturing plants. viz.tata.voltas. Jamshedpur.com/ http://www.. Hyderabad. Sources: http://www. Each of these for market coverage and customer Manufacturing Voltas manufactures industrial air conditioning and refrigeration equipment.htm http://www. freezers. air conditioners. Chandigarh. group. into four independent businessand refrigeration business group. high-quality refrigerators and room air conditioners.htm Manoj Banshilal Pachouri 38 ICFAI Business School .Areas of business Operations Voltas' operations are organized specific clusters: air conditioning international operations business group and engineering products divisions has independent facilities servicing. It has territorial offices in Ahmedabad. Location Voltas has its head office in Mumbai and zonal headquarters in Mumbai. unitary products business business group. LG Electronics of Korea and Fedders International of USA.com/voltas/index. Hong Kong and Singapore. Voltas has partnered with international companies.tata. forklift trucks and large water supply pumps. for 'manufacture only' alliances producing low-cost. Bangalore. the union territory of Dadra. Pune and Kochi. water coolers.
the company diversified into jewellery under the brand Tanishq. each of which is a leader in its segment. The company has manufacturing and assembly operations at Hosur.Titan Industries Titan Industries is India’s leading manufacturer of watches and jewellery and the world’s sixth largest manufacturer brand of watches. Nebula – in solid gold and precious stones. Its main products are: Watches: Titan manufactures two main brands viz. offering quartz technology with international styling. The Titan brand architecture comprises several brands. Titan for the premium segment and Sonata for the below-$25 category. manufactured at its state-of-the-art factory at Hosur. the Gold and Steel collection. Notable among them are: Titan Edge – the world’s slimmest watch. Areas of business Titan manufactures over 7 million watches per annum and has a customer base of over 65 million. In 1995. It also entered the segment of premium fashion watches by acquiring a license for global brands such as Tommy Hilfiger. Titan leveraged its manufacturing competencies and branched into precision engineering products and machine building in 2003. the company launched a second independent watch brand — Sonata — as a value brand to those seeking to buy functionally styled watches at affordable prices. Dehradun and Himachal Pradesh. and Fastrack in the sporty casual category. Manoj Banshilal Pachouri 39 ICFAI Business School . Established in 1984 as a joint venture between the Tata Group and the Tamilnadu Industrial Development Corporation. Leveraging its understanding of different segments in the watch market. Raga 9 to 5 – for the woman achiever. Tamilnadu. Further. Titan has also diversified into fashion eyewear with its Fastrack Eye Gear sunglasses. the company transformed the Indian watch market. Flip – India’s first and only reversible watch with two movements and dial faces.
tata. Titan retained it ranking as the 'No 1 Brand' in the Brand Equity Survey. Platinum jewellery and designer silverware are also a part of the product range. Tanishq is one of India’s largest specialty retailers and is transforming the jewellery market in India. 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.tata. Precision engineering: The Company’s precision engineering division manufactures dashboard clocks as OEM to car manufacturers in Europe and America.com/titan/index.htm http://www. in the Consumer Durables category. Friends of BIL Award for employing the handicapped. including the 'Young Design Entrepreneur of the Year'. Its exclusive retail showroom chain – World of Titan – is amongst the largest in its category. Titan watches are sold through over 9.com/comp/titan/ http://www. It also supplies precision components to the avionics and the automotive industry.000 outlets in over 2. http://www.indiainfoline.com/ http://www.Today. 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. Greece and countries in the Middle East and Asia Pacific.com/titan/media/index. Titan has over 60 per cent of the domestic market share in the organized watch market. Spain.titanworld.htm Sources: Manoj Banshilal Pachouri 40 ICFAI Business School . Achievements Titan Industries has been awarded the following: • • • • • The President of India’s Award for employing the disabled.300 cities and internationally in over 30 countries including the UK. The Titan Design team received 7 accreditations at the NID — Business World Awards.
This is independent of the manufacturing and supply operations of its Tetley and other subsidiary companies. Russia and Kazakhstan markets. Kanan Devan. The company has a 100 per cent export-oriented unit (KOSHER & HACCP certified) manufacturing instant tea in Munnar. developed in-house. The company has its headquarters in Kolkata. giving it a distinctive liquoring and taste profile. Products and brands The company has five major brands in the Indian market — Tata Tea. which includes Tata Tea and the UK-based Tetley Group. the Tata Tea Group of Companies. caters specifically to the Australian. Tetley. The unit's product is made from a unique process. West Asia. Instant tea is used for light density 100 per cent teas. Kerala. of extraction from tea leaves. Middle East. coffee. 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. 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. today represent the world's second largest global branded tea operation with product and brand presence in 40 countries. Tamilnadu and Kerala and one coffee estate in Tamilnadu. Poland. and 51 tea estates in the states of Assam.500 hectares under tea cultivation. Manoj Banshilal Pachouri 41 ICFAI Business School . and investment income.Tata Tea Set up in 1964 as a joint venture with UK-based James Finlay and Company to develop valued-added tea. Among India's first multinational companies.7 million retail outlets (ORG Marg Retail Audit) in India. 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.350 Stockists caters to over 1. With an area of 26. Tata Tea's distribution network in the country with 38 C&F agents and 2. West Bengal. which is the largest such facility outside the United States. Tata Tea produces around 60 million kg of black tea annually. North Africa. iced tea mixes and in the preparation of ready-to-drink (RTD) beverages.
tatatea.com/ http://www.htm Manoj Banshilal Pachouri 42 ICFAI Business School . The Tetley Group headquartered in Great Britain. Tata Coffee with instant coffee manufacturing facilities. Australia. Tata-Tetley is a Kochi-based EOU which services the branded business of specific Tetley and Tata Tea markets outside India. Sources: http://www. is the largest coffee plantation company in Asia. Tetley is the second largest tea bag brand in the world.Subsidiaries Tata Tea has subsidiaries in Great Britain.com/ tata_tea/media/index.htm http://www. producing over 9000 MT of coffee annually.com/ tata_tea/index. it is the number one tea bag brand in Great Britain and Canada and has significant market shares in the United States.tata. R&D capability and plantation assets of around 8000 hectares. Tata Tea Inc in the United States processes and markets instant tea from its facility in Florida. is a leading international tea company selling over 60 Tetley branded products to over 40 countries world-wide.tata. Poland and France. United States and India. Kerala. based on sourcing of Instant Tea products out of Munnar.
an NRI who incorporated the company in 1985 with a vision to transform the business. Amara Raja has joined hands in a strategic partnership with Johnson Controls. Amara Raja was. Amara Raja Batteries Limited (ARBL). oil & gas. General Motors..com/ Manoj Banshilal Pachouri 43 ICFAI Business School . like anything else. Inc. etc. and preferentially to Hindustan Motors. 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. In India ARBL supplies automotive batteries exclusively to Ford. power. DOT. ARBL is also a preferred supplier to major telecom MNCs. The ARBL scrip is actively traded on BSE.Amara Raja Batteries Limited (ARBL) Before it became one of the leading battery makers in India. Sources: http://www. Ramachandra N Galla. Amara Raja and Johnson Controls both share a commitment to excellence and innovation and work towards exceeding customer expectations. DaimlerChrysler. besides a host of companies in segments like UPS systems.amararaja. a little dream…a dream realized by Mr. Mahindra & Mahindra and Ashok Leyland. and is part of its global alliance. Indian Railways. NSE and HSE.
It also has vibrant businesses in the distribution of heavy commercial vehicles passenger cars. TVS commands a strong presence in manufacturing of two-wheelers. For the Indian Automobile sector. auto components and computer peripherals. As one of India’s largest industrial entities it epitomizes Trust. it was a breakthrough to be etched in history. 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 50.000 people worldwide and with a turnover in excess of USD 2. is the third largest two-wheeler manufacturer in India and among the top ten in the world. TVS foresees to have profitable operations overseas. V. The Company aims to hone and sustain its cutting edge of technology by constant benchmarking against international leaders. With steady growth. 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. technology and marketing.2 billion.2 billion TVS Group. TVS Motor Company Limited. T. Manoj Banshilal Pachouri 44 ICFAI Business School . The year 1980 is one to be remembered for the Indian two-wheeler industry. Sundaram Iyengar. India's first two-seater moped that ushered in an era of affordable personal transportation. expansion and diversification. capitalizing on their expertise in the areas of manufacturing. with an annual turnover of over USD 650 million. Value and Service. finance and insurance. Today. the flagship company of the USD 2. employing more than 40. there are over thirty companies in the TVS Group.TVS Motors TVS Group was established in 1911 by Shri. especially in Asian markets.
Many firsts of TVS Motors India’s first two seater 50 cc Moped TVS 50. in February 2005. 4 stroke motorcycles in April 2000. India’s first 150 cc. introduce 100cc Indo-Japanese (sub-100 cc Launched India's first indigenous Scooterette variomatic scooters). TVS Scooty in June 1994. Launched TVS Star in Sept 2004. a 100 cc motorcycle which is ideal for rough terrain. Introduced India's first catalytic converter enabled motorcycle. Launched TVS Fiero. in August 2001.tvsmotors. launched in August 1980. Launched TVS Victor. the 110cc Shogun in Dec 1996. 4-stroke 125 cc motorcycle. Launched India's first 5-speed motorcycle. the Shaolin in Oct 1997. a world-class 4-stroke 100 cc motorcycle with the revolutionary VT-i Engines for bestin-class mileage. 4-stroke 110 cc motorcycles. First Indian Company to motorcycles in Sept 1984. Sources: http://www. India’s first fully indigenously designed and manufactured motorcycle. Launched TVS Victor. Launched TVS Centra in January 2004.com/ Manoj Banshilal Pachouri 45 ICFAI Business School .
Electric Power Tools. FIPs. the Mysore Branch of the Central Bank of India Ltd. offered for sale 22000 shares of the Company to the public at a premium of Rs70 per share.Motors Industry Company Limited (MICO) MICO was incorporated in 1951 as a subsidiary of Rober Bosch. Auto-Electricals. communication technology and capital goods. Spark Plugs segments and also in the Electric Power Tools segment. Manufacture of special purpose machines. Parent company MICO is a 60. In 1969. hydraulic products and auto Electricals including spark plugs. has presence in more than 130 countries. Its other products include large number of automotive accessories as well as Special Purpose Machines. The Company has continuously modernized and upgraded product range. which was later shifted to Bangalore in 1953. Blaupunkt Car Audio Systems. with its registered office at Madras. Robert Bosch’s other business interests include consumer goods. Manoj Banshilal Pachouri 46 ICFAI Business School . The company has since its 50th year embarked on a share buyback pursuant to its allowance by the Government. Germany. MICO has strong presence in the Indian automotive components business with a virtual monopoly in the Diesel Fuel Injection Equipment. In 1986 it began manufacture of mini spark plug (extension of its spark plugs range) for motor cycles. Gear Pumps for tractor applications and Packaging Machines. Industrial Equipment. MICO embarked on manufacture of starter motors. which was till then being imported. a global leader in the field of auto components. alternators. hydraulic and pneumatic equipment etc in 1989-90. machine tools accessories etc began in 1987. MICO manufactures nozzles & nozzle holders. Robert Bosch.5% subsidiary of Robert Bosch.
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.Quality. Sources: http://www. Plant locations MICO has 3 plants.bosch. innovation and continuous improvement to enhance customer satisfaction.com/ http://www.9 bn in Q1 2001 to Rs 3. Company's operating profit was at Rs2. MICO's net sales were at Rs 14. one at Nashik for nozzles and nozzle holders. The Nashik plant achieved new milestone in producing the 50 millionth nozzle holder assemblies. The operating profit declined by 20% from Rs 745 mn to Rs 594 mn in Q1 2002. company’s total sales decreased by 8%. The Bangalore plant achieved international quality levels in Single Cylinder Pumps. Subsidiaries MICO has two 100% subsidiaries. The BeQIK philosophy has helped the company in achieving world-class quality.5bn and net profit was Rs 817mn for F12/01. The company plans to continue innovating by designing and developing diesel fuel injection systems taking cognizance of fuel consumption. In Q1 2002.6 bn. In F12/01. Other income increased by 23% from Rs71 mn in Q1 2001 to Rs87 mn. innovation and keep customer satisfied.MICO has adopted the Bosch guiding principle of BeQIK. from Rs3. Net profit declined to Rs 257 mn in Q1 2002 from Rs 269 mn in Q1 2001.com/ Manoj Banshilal Pachouri 47 ICFAI Business School . another at Bangalore for FIPs and hydraulic products and the third at Naganathapuram for auto Electricals including spark plugs. emission and greater safety of the end users.in. The company has over 4000 sales and service outlets countrywide.5 bn. Motor Industries Software Ltd and Motor Industries Trading Private Ltd.micoweb.micobosch.
Sultanate of Oman. research and development.” Sources: http://www. Kuwait.000 sq. The plant makes use of the world-renowned multi-line dry process technology. Bahrain.000 sq. Philippines. Singapore. has an installed capacity of 20. of Monoporossa Wall tiles & Floor tiles.000 sq. It has two plants. South Africa.Bell ceramics Bell Ceramics was established in 1985. comprising depots. mtrs of floor tiles per day. mt/ per day which manufacture floor tiles and wall tiles in wide range of products. Qatar. The plant located at Dora (near Baroda) in Gujarat. UAE. Western India. New Zealand. mtrs per day. clearing & forwarding agents. which is environment friendly and energy efficient. Mauritius. It has wide spread distribution network. The second plant located at Hoskote (Bangalore). It was established with the objective to manufacture world class ceramic glazed floor and wall tiles for domestic and international markets. Manufacturing at plants is according to COMITEE EUROPEAN DE NORMALISATION (CEN). dealers and retailers which are nationally connected through world class ERP software. patterns and shades. Both plants are ISO 9001-2000 & 14001 certified. Saudi Arabia. Bangladesh. with Italian collaboration. Kenya and many more Awards and achievements: Felicitated by many awards including award from President of India for “Excellent Export Performance.com/ Manoj Banshilal Pachouri 48 ICFAI Business School . has production capacity of 10. Export Markets: Australia. strategically located near major Indian markets with production capacity of 30. sizes. Southern India.bellceramics. Bell has tie ups with many international players for tiles manufacturing technology.
under the Beetel brand. including the PTT markets. 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. comprising of over 40 models spanning the basic.Bharti Teletech Bharti Teletech . feature-rich and cordless telephone categories. Bharti Teletech produces a comprehensive basket of customer premise equipments. Bharti Teletech currently exports to 30 countries in five continents. 95% in the PSP business and 60% in the tender market. The new initiatives of the company under the ‘Beetel’ brand include Broadband Products and Set Top Box – a hi-growth market in India. Bharti plans to double its exports in 05-06 over last year.a Bharti enterprise. 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. 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. is India’s leading telephone instrument manufacturing company and one of the largest in the globe. Established in 1985. Beetel commands a market share of over 40% in the retail market.1 in home and office telephony worldwide) for marketing of GE telephones in India and neighboring countries as well as exports. Both are focus areas for the company Manoj Banshilal Pachouri 49 ICFAI Business School . 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. Peru. Bharti Teletech entered into a technical collaboration with Siemens AG. In 1985. Bharti Teletech has a tie-up with Atlinks (No. the German technological giant and set up a plant in Ludhiana to manufacture telephones.
3 billion in 2004. came ISO 9001-2000 accreditations for the manufacturing units . in 1993-94. Shortly after.bharti. workplace and all spaces in between. the first to cross the 10 million unit mark and thereafter 20 million mark. the American telecom mammoth. Success came on both fronts and fast. About Motorola Motorola is a Fortune 100 global communications leader that provides seamless mobility products and solutions across broadband. And in a short span of time. Seamless mobility harnesses the power of technology convergence and enables smarter. the only Indian telephone company to be present in 30 countries mapping 5 continents. Sources: http://www. India's first EPBT phone. In your home. cost-effective and flexible communication. anywhere.In 1991. one of the largest telephone manufacturers across the globe. faster. Beetel manufactured phones for 'Sprint'. Cornering a third of the Indian market.com/ http://www. things and information you need. auto.by this time two in numbers. The first telephone instrument to get ISO accreditations. embedded systems and wireless networks. anytime. Motorola had sales of US $31. A brand present in every second Indian home. at Gurgaon and Ludhiana.motorola. Beetel was already the market leader. Beetel became 'India's Favorite Phone'. seamless mobility means you can reach the people.com/ Manoj Banshilal Pachouri 50 ICFAI Business School .
grills and outdoor metal structures. PAINT & SPECIALITY COATINGS MRF Paints is division of MRF which deals in paint and specialty coatings. It is used extensively in to paint machinery. strong adhesion and durability. nylon. protecting it against the wearing effects of the weather. They are long lasting and have lower incidence of flats. plastics. moisture and domestic spills. In cross-ply tyres. opaque. Radial technology is an improvement over cross ply and radial tyres are priced at (of 25-30%) premium. corrosion. In radial tyres. Some of products from MRF Paints are: MRF Metalcoat: MRF Metalcoat is the ideal surface finish for any metal. MRF manufactures specialty coatings for wide range of applications. textiles. The coatings have been developed for color and gloss retention. metallic and frosted finishes. fiberglass or steel cords are arranged perpendicular to the circumference. They guard against abrasion. tubes. bus bodies. chemicals. abrasion. wood. bad weather and ultra-violet radiation and are virtually maintenance free.MRF Ltd MRF manufactures automobile tyres. extensively in the packaging industry. nylon or rayon tyre cords are arranged diagonally across. paper. tread rubber and precured treads. MRF Glasscoat: MRF Glasscoat is glass coating transparent. MRF Woodcoat: MRF Woodcoat is a lasting surface finish for application on any kind of wood. that offers It is used Manoj Banshilal Pachouri 51 ICFAI Business School . vinyl. ceramics and glass.cross-ply and radial. Tyres are basically of two types . It is also extensively used in chemical plants. metal furniture. grills. polyester. The revolutionary 100% polyurethane finishes are available in formulations for application to metal.
glass. chemicals and ultraviolet radiation. It offers high resistance to abrasion. wood. MRF Brasscoat: This clear coating for brass items tarnishing.mrf. thereby reducing the labor of frequent polishing. Source: http://www.com/ Manoj Banshilal Pachouri 52 ICFAI Business School . prevents MRF Autocoat: MRF Autocoat is a 100% polyurethane car finish that adds beauty and life to your car. A catalyst in vapor form accelerates the curing of paints and coatings and eliminates the need for temperature baking of industrial paint finishes. corrosion. plastics. ceramics and paper.MRF Vapocure: MRF Vapocure is used in surface coatings for wide range of applications of manufactured items such as metals.
PROCESS ANALYSIS Processes and Organization Manoj Banshilal Pachouri 53 ICFAI Business School .
Manoj Banshilal Pachouri 54 ICFAI Business School . order punching. To get a better insight of activities. Data for ABC Analysis was collected from companies’ individual ERP Modules and Inbound & Outbound Registers. I collected storing material information by tracking Titan watches in Titan store which are stored code wise. Sources of Data Collection Primary Data: Primary data (or fresh data) was collected by me from Fairdeal’s staff and manager through person interaction. It was important to understand the working culture and environment of the company to understand its processes better. physical verification and many other processes myself. I started interacting with Fairdeal’s staff. as a clearing & forwarding agent. managers and store keepers. Internet.Processes and the Organization This phase kicked off with understanding the processes of organization. Secondary Data: Secondary data (or published data) was collected from Company documents. For instance. Fairdeal. Articles. I could punch data. handles more than twelve companies in various industries. Since different industries and different companies have their own rules and regulations of operations. Business magazines. dispatch orders and scan barcode serial numbers of Motorola mobile sets in Bharti Teletech. ICFAI Business School’s study materials and from other variety of sources. it was a challenge to study the processes of these companies by framing them in a common frame. I participated in Goods receiving. order taking. I also used to observe processes and activities to collect data. Industry specific Journals. accept orders.
Organization Structure of Fairdeal Figure 3: Organization Structure of Fairdeal Manoj Banshilal Pachouri 55 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. c.g. Fixed amount – Titan Volume or tonnage based Units per piece Manoj Banshilal Pachouri 56 ICFAI Business School . Rent based on square feet of area (4. loading/ unloading 3. b. freight. 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. Remuneration claimed by CFA There are three components of charges claimed by CFA: 1.: Labor charges.: Hardware installation charges.5 – 5 Rs per square feet) occupied by the company. Variable charges E. Fixed charges E. Stationary.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.g. Remuneration as service provider a. 2.
These operations consist of goods receiving.733 211 (Includes Tanishq. Hemant http://trswamd/servlet/til.146 660. Goa. Ms. BlueDart and Unifreight. Delhi and Bangalore 366.InvDocPrn/ Mr.Company Wise Processes Fairdeal group is carrying out Supply Chain operations of more than twelve companies valued at Rs 3000 Crores. 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. handling goods returns and unsalable material. Anal. dispatching. cross-docking.996. transporting. carton can be opened in presence of courier boy itself. pay sales tax and Octoroi etc. collecting cash. and Hosur Tanishq jewellery. weighted in the warehouse to check uniformity of cartons. re-labeling. Fastrack and Hillfigure) Watches come from Ooty factory through courier services mainly Gati. Here is a brief overview of processes being carried out for each principal company handled by Fairdeal. Manoj Banshilal Pachouri 57 ICFAI Business School . If weight doesn’t match. handling warranty claims. re-packing. storing. Carton is checked for any physical damage and pilferage. stock maintenance. Aashish Ms. order accepting on behalf of principal. Dehradun. reverse logistics etc.trs.350.watches.00 5. Sonata. Komal Ooty. Sonata watches Tomy Hillfigure and Fastrack eyegear Ludhiyana. Noida.
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. Manoj Banshilal Pachouri 58 ICFAI Business School . 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. 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. 9999xx99x or. Coding system of watches: 999xx99x or. 999999xx99x or.Carton contains packing slip containing number of pieces and codes. Last alphabet in titan watch might be K which shows that leather strap is brown. Note: For paired watches case code is 6 or 8 digit number. 09 is code for dial type K means that the strap of the watch is brown. 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.
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. Billing and dispatching should be done at the same place. If new watches come in front. 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 . stacking is used in which new watches are placed behind old watches. For example watches with codes 1044YM01 would be placed in racks before watches with codes 1348BM01 To maintain FIFO.Goods Receiving: Titan and sonata comes in 1800 models and variants. FIFO is violated.
J2EE.com:9080/ .611 9 Order taking: Dealer places order via phone/letter or punches it into SDNet. 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. Delhi and Bangalore http://www.com Mr.888 211. Inet crystal clear for reporting Beetel telephone instruments.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. Manoj Banshilal Pachouri 60 ICFAI Business School .bhartiteletech. Noida. Raman SDNet (Sales and Distribution Network) [http://www.29 1.beetel-india.jsp. Set Top Boxes Motorola mobile sets 146. Goa. 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.538. Vinod Mr. order has to be punched into SDNet manually by warehouse personnel’s. Sunil Patel Mr. If order placed via phone.743.
Employees should be motivated.Recommendations for Bharti Teletech: All Motorola cases have to be brought to SDNet terminal to scan their IMEI numbers. 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. if not more. 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. in handling absent employees work. They have learnt it by R&D and trail and error methods. 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. 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. Training to operators: No formal training is given to SDNet operators. It has been seen that some employees lack courtesy and communication skills. For example: if one employee is absent or quits his job. New employees will learn better than those who have been working for a long time on single SD network. This will ensure smooth operations even in case of absenteeism and job vacancies. This consumes manpower as well as time in moving the cases. Manoj Banshilal Pachouri 61 ICFAI Business School . there should be another employee in Fairdeal who is at least 80% efficient. Employees can be allotted to one company’s operations and one secondary companies working can be taught to him at the time of joining.
Amara raja e-ARIMS (VB and crystal report. integrated with . Warehouse terminal data is synchronized with company data via dial up virtual private network (VPN). Vinod Mr.900. Software used: 1.98 4.560 112. Amara raja E-application (http://localhost/bs/. Bangalore.960.136 8 Jaipur.amararaja.com Mr.NET application (E-application) 5. RKM (old).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. Shabbir Amaron batteries Bhiwandi. 2. Pravin Mr. Pune. 3. Ghaziabad.net and web services) 4. Delhi 58. Manoj Banshilal Pachouri 62 ICFAI Business School . Indore. uses ASP. BsApp Software. local software without internet support).
AS Transport. Receiving Orders: Dealers place order at Premium House. 4 Volt cells are used for Idea and Hutch towers. IBD: Industrial Battery Division IBDs are used for Invertors and UPS systems. Gandhigram branch office which is then forwarded to warehouse for dispatching via telephone. Batteries are then physically checked for damage.. approval from Mumbai is required. 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. TCI. Sai transport (from Bhiwandi) Goods Receiving: Once batteries arrives the warehouse. Transporters: Indo Arya Central Transport Ltd. After receiving material. prasanna cargo (from Pune). Patel roadways (from Bhiwandi). type of battery. Shivraj Roadlines (from Pune). Cycle Count: Book stock and physical stock is validated daily morning. Movement of batteries is based on serial numbers basically. barcode and plastic wrapping before storing them in warehouse. Manoj Banshilal Pachouri 63 ICFAI Business School . For dispatching IBDs.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. embossing. transporters handover packing slips to store Incharge which contain serial number of batteries.
Batteries of previous lots are dispatched first. Reverse Logistics: Delivery challan or warranty replacement (3 copies – yellow. 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. 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. Handling Warranty Claims: In case of warranty claim. These reports are generated dealer wise which are then added separately code wise and punched into Excel sheet. Labels are stuck to batteries of one lot containing receiving date and quantity with serial numbers. T-shirts. caps. fly up stand etc. Weekly stock report has to be made code wise which is taken from reports generated in BsApp. This method resembles Kanban Japanese practice. Manoj Banshilal Pachouri ICFAI Business School 64 . service engineer checks battery at dealer’s place and if satisfied. sends battery for replacement to C&FA. Reporting: Weekly report is sent to branch office every Thursday. Hoardings.POP (Product of Promotions): Advertising material is also dispatched from warehouse against instructions from branch office. feature charts. For FIFO: Batteries come in lots.
OEM battery is of white color Lead price is Rs 33/. permission taken from SCM and then handed over to Ganapati Metals. Manoj Banshilal Pachouri 65 ICFAI Business School .Handling Scrap Batteries: Scrap batteries (returned in free and prorata replacements) are stored in scrap warehouse. Notes: • Battery must be charged every 40 days even in warehouse. weight noted. DD is then sent to Head Office in the name of Amara Raja. Serial number is destroyed to avoid re-claims and a hole is made into battery. (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.per kg. Company has provided with a charger which can charge 32 batteries at one time. Serial number is noted. Cordless scanner would eliminate physical checking of serial numbers and then punching them into terminal. Indore who is All India contractor for purchasing battery scraps of Amara raja.
xls format and attached to email to McFills Company. FIFO: stack card is labeled to boxes containing manufacturing date. It is verified for pilferages and stored in warehouse. Orders from dealers are obtained by phone (sales officer) or dealer in writing with DD. Material comes next day with Transporters LR (Lorry Receipt) and cash memo. Ahmedabad http://www.33 1233 129 Indent form is filled in . 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. Stock transfer is not done in McFills division of Fairdeal till date.salable product like air-leaked packs. Non.McFills Foods Factory location Company website Process owner Computer operator Store keeper Software used Products Quantity handled Value Transactions No of dealers Sharkhej.764 20. material with earlier manufacturing date is dispatched earlier. damaged packs. price code etc. Bharat Mr. Hemant Thakkar Mr. Wafers. batch number. McFills are using 2500 sq ft of space in the warehouse (As in Feb 2006). This material is then sent back to McFills factory.003.com Mr.471. Manoj Banshilal Pachouri ICFAI Business School 66 .mcfills. Material comes from Ahmedabad factory in medium sized trucks. Bharat DOS based FAS (financial Accounting system) Snacks. Orders are then punched into data entry module of FAS. Potato Chips 67.
Though transaction volume is comparatively lower it is creating problems for customers as computer operator is not available when he is in store.Recommendations for McFills: • Indent form preparing is responsibility of branch manager and not of CFA personnel. Quantity of unsalable material returned from dealers is very large compared to other companies. This activity can be annulled. Single person is handling computer operations as well as store for McFills. • • 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.
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. material is unloaded. Saurabh Mashruwala Mr. defreezer (for ice-creams. water cooler (Mfg in Hyderabad) and mini magic water dispenser (made in china). vesicular (Glassed door for storing cold drinks). Mr. Targets are decided in MBRM (Monthly Business Review meeting of Voltas) held for area sales managers. Receiving Goods: When truck comes to warehouse. Dharmesh joshi. It uses lotus notes. Saurabh Mashruwala Ms Shreedevi srinivasan Mr. receipt is given to transporter and received details are punched into SAP module.730. Khanpur Branch Ahmedabad gives orders to Head office.168. Hyderabad http://192. cassette evaporating unit Mini magic (made in China) 14. Amrit SAP R/3 Refrigerator. Fairdeal comes to know only when goods come to warehouse.9/ private website for mails and communication with C & FA and dealers. Mr.Voltas Factory location Company website Dadar. Manoj Banshilal Pachouri 68 ICFAI Business School . milk etc).385. Dharmesh is intimated.435 177. Logistics Incharge Voltas.66 5. Address of Fairdeal is checked in documents.130. window and split AC.
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. 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. Dharmesh is intimated again so that he can punch orders of dealers into SAP module. Schedule line Message tick is to be removed from SAP module only then outbound of material is permitted.SPT 1800 communication software (written in VB) is used for goods received and Barcode scanning.g. transporter etc Goto Goto Goto Header Header overview Loading options Number of packages Post Goods Issue (PGI) . 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.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. Operating cordless scanner: VDS -> goods received -> scan barcode from Voltas products Mr. Manoj Banshilal Pachouri ICFAI Business School 69 . Select one number and click save button which will generate Invoice number.
Outbound Process: Invoice or bill is given to transporter who dispatches the material.e. VF 31: To print Invoice Tick invoice lists and lists from [Inv no] to [Inv no]. 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. To prints bills of specified invoice numbers. 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. where. After material is dispatched received receipt is collected back. sales order items with order number.Inbound procedure: Transporter gives invoice to warehouse from which delivery number is putted in SAP module to get all details and all serial numbers. serial numbers Click check box named ‘Item OK’ and click post button. Quantity. VA 03 choose Environment changes execute [click watch icon] - Manoj Banshilal Pachouri 70 ICFAI Business School .
Vadilal.6 & 0. Pepsi. Dadar material is not required to be scanned as delivery number can be used in SAP module to get all serial numbers. Training for SAP module is given at Mumbai for 3 days. Inwards from Hyderabad have to be done using scanner as SAP is not implemented there.8 ton split ACs imported from china. Amul. There should be preplanned arrangement of labors and storing space to avoid wait time. Manoj Banshilal Pachouri 71 ICFAI Business School . Recommendations for Voltas: • Voltas trucks have to wait for unloading material in absence of required number of labors. Gokul have agreement with VOLTAS to supply their sticker putted products.6 ton window AC and 0.Notes: • • • • 0.
Spark plugs. Pramod IN4VANCFA . 1 copy with MICO branch office and 1 copy with transporter are maintained. gate pass are made in triplet. • • • • Manoj Banshilal Pachouri 72 ICFAI Business School . Rajesh Mr. Hemant Mr. Mr. filters.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.625 531.926 7 • • • • Material comes through courier/ Transport Material is stored at primary as well as secondary locations. Padali branch office.918. Bhavasar is notified MAN (Metropolitan Area Network) is being used to print pick slips by branch office at Fairdeal warehouse.com Mr. Option 9) DC (Delivery Challan) is then printed by warehouse people. Pune. Secundarabad. Salim Mr.072. Bangalore and Nepal http://www. Chennai. Automobile spare parts 4. 1 copy with Fairdeal. Overhauling kits. DC.00 31.mico.000. Pick slip is then validated against IN4VANCFA software module (Menu 1. Engine oils. LR.Rally for AS/ 400 Automobile spare parts. Batteries.
FIFO: Colored codes with month number are labeled to bulk items. It should be replaced with some advanced software like SAP R/3. Manoj Banshilal Pachouri 73 ICFAI Business School . Computer operator has to wait for a long time after entering a command. 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.
057 34 Operations in TVS Motor are purely clearing & forwarding. Store keeper then goes to warehouse and writes down serial numbers of ordered brands. After inspection bikes are stored brand wise and lorry number is noted down on the seats of bikes. At the time of unloading. Tamilnadu and Mysore http://www. Due to scratches on barcode labels or lack of proper lights. It is also checked for any physical damage or scratches.532. TVS Pep. Orders are taken by branch office and conveyed to computer operator of Fairdeal via telephone. Mohan SAP R/3 TVS Victor.668 1. Mitesh Shah Mr. TVS Centra. Computer operator then validates it against SAP R/3 by entering order number. After verifying documents. TVS Star TVS bikes spare parts 46.82 2. bikes are stored in scrap warehouse. Battery.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.464. trucks are unloaded. Manoj Banshilal Pachouri 74 ICFAI Business School . These numbers are used to prepare bill. TVS Apache. Tool box and other accessories.co. Store keepers get confused between digits 8 & 3 and 0 & 8. bikes are checked for Key.in/ Mr. If scratches or damages are found.980. Rearview mirror. Narendra Mr.tvsmotor. Trucks come to warehouse from factory location. there are problems in noting down serial numbers.
As of now.e. Physical stock sometimes does not tally with book value. This error occurs due to labor picking wrong bikes or error in noting down serial numbers. 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. At present bikes received first are dispatched first but this rule is not followed strictly.FIFO: Manufacturing weak number is present on number plate of bikes with Engine numbers and frame numbers. Notes: • • • 5000 bikes dispatched per month all over Gujarat. • • • Manoj Banshilal Pachouri 75 ICFAI Business School . Bill has to be made in Excel sheet. This will reduce human errors as well as increase efficiency of receiving and dispatching also. Recommendations to TVS: • TVS division has two computers. Cordless barcode scanner can be used to scan serial numbers instead of doing it manually. one for SAP R/3 operations and other for assistant works. i. This will help Fairdeal in arranging for bikes space and avoid parallel unloading. bikes billed for one dealer are dispatched to other dealers. These computers should be connected to each other through network connection. In case of cross-dispatching. data has to be transferred using Floppy disks from one machine to another. Transporters should be encouraged to intimate Fairdeal in advance about their arrival. Some times there is error of Cross-Dispatching.
Bell Ceramics Factory location Company website Branch Manager Dora near Bangalore Baroda. dealers have to keep pre-signed cheques with depot. 397X397 mm and 400X400 mm categories.843.bellceramics. 300X300 mm. Tiles are checked for physical damages and If damages are up to Rs 4000/.93 47.xls) sheets.or less.com] Process owner Computer operator Software used Products Quantity handled (Sq mts) Value (INR) Transactions No of dealers Mr. Order is taken on phone by Fairdeal.96 4. At present.464 100 Bell ceramics has tiles in 200X300 mm. else it is claimed from insurance company. Data in MFG Pro software is uploaded by emailing Microsoft Excel (. damage is claimed from transporter. invoice is printed and material is dispatched with gate pass and LR copies. Hemant Thakkar Mr. Hoskote near http//www.426. Hemant Thakkar MFG Pro wall and floor tiles 250.127. Manoj Banshilal Pachouri 76 ICFAI Business School . Wall tiles are manufactured at Dora and Hoskote plant manufactures floor tiles only. Ramesh Desai [Ahmedabad@bellceramic.com/ Mr. If cheques are present. If cheques of dealer are not present. no order will be made.
this company does not have any branch office in Gujarat and Area Sales Manager Mr. There is at least 2% to 3% variation in shade for every batch change. Ramesh Desai works from Fairdeal premises itself. This increases Fairdeal’s work as orders have to be punched manually by Fairdeal staff. Fairdeal should negotiate with Bell management to provide them with better infrastructure to operate its activities better. Further. Manoj Banshilal Pachouri 77 ICFAI Business School .Notes: • Tile Shades vary every batch. Recommendations for Bell Ceramics: All orders in bell ceramics are placed either via telephone or written order is sent to depot.
93 2. Carton is checked at time of receiving and stored at ground floor itself from where it is dispatched to Idea Cellular.3 8.368.IM Technologies Process Owner Store Incharge Factory location Quantity handled Value (INR) Transactions No of dealers Mr. Aashish Mr. Vinod Mr.605 65 Manoj Banshilal Pachouri 78 ICFAI Business School . Maniyar Mr. 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. Gandhinagar.500.396.00 19 1 SIM cards come from Noida (imported from abroad) through courier.072.599. IMS and Bill Printing Paint products and speciality coatings 33. Tushar MS Dos based InvMenu. Aashish Noida 502. Himanshu P.000 10.
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.
Ltd Process Owner: Mr. Out time. of the project. Inward and outward registers are maintained company wise and day wise also. In time. Staffs register tracks In and Out time of employees. Truck daily register records vehicle number. • • • • These company wise processes study in this phase will make the basis for further research in next phases. ABC Analysis and AS-IS Analysis phases. Manoj Banshilal Pachouri 80 ICFAI Business School . Fairdeal has eight security guards. security guard’s sign At Main warehouse. Party name (transporter or dealer’s name). loading or unloading. Gate pass is checked for quantity (short or excess both) and validated against physical goods at the time of dispatching at main gate.Security at Fairdeal Distribution Services Pvt. driver’s name. Godown keeper and truck driver and signed by all three also. Ram Prakash Singh Kushwah • • Material is loaded in presence of security guard.
ABC ANALYSIS Value Wise and Quantity Wise Manoj Banshilal Pachouri 81 ICFAI Business School .
With this information. did not have any modules for sales figures in which case help of management was taken to provide the relevant data. freight claim registers etc. This is least valuable category and least profitable as well. operations of all client companies have to be categorized in A. Category B: This category consists of 20% of items by Units of Measure (UOM) and 20% by value. outbound registers. Some software packages. invoices. B or C groups to get the information about which companies constitute the major part in Fairdeal’s turnover. quantity and 70% by value. Data Collection Data for all companies was collected either from their ERP applications or I had to search the data from reimbursement registers. Manoj Banshilal Pachouri 82 ICFAI Business School . Category C: This category consists of 70% of items by Units of Measure (UOM) and 10% by value. It categorizes inventory by its highest value and greatest volume. This category items are less profitable than category A items but more profitable than category C items. inbound registers. In this analysis. This is most valuable category and most attention should be given to this category.Definition of ABC Analysis ABC Analysis: ABC Analysis is an inventory management tool based on the tenets of Pareto Analysis. inventory managers can focus on increasing those inventory SKUs with the greatest potential positive return for the organization. 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. 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.e. In this phase. like Rally for AS/400 in MICO.
127.394.00 2.710.114.84 777.279.489.40 734.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 534.980.597.82 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 575.07 533.70 978.04 707.640.48 613.498.227.41 725.00 10.350.098.532.00 0.082.78 LANTERN GAS TABLE Manoj Banshilal Pachouri 83 ICFAI Business School .93 TVS Motor Data TVS Motors Value (INR) Total 1.262.017.00 69.464.00 1.182.799.70 8.01 730.363.88 791.141.556.632.249.78 217.00 35.00 91.11 614.00 16.599.29 628.368.
780.220.752.789.00 Sonata 118.863.00 Amara Raja Data Amara Raja Value (INR) Total 112.00 Gold Plain UCP Jewellery 4.00 Value (INR) Value (INR) PLAIN JEWELLERY WITH STONES 29.33 IM Technology Data IM Technology Value (INR) Total 10.932.00 Tanishq Jewellery Data Gold Plain 119.471.850.653.00 Gold Coins 27.00 SOLITAIRE 150.900.220.446.286.00 Tommy Hilfiger 9.003.719.687.500.076.073.789.485.00 TANISHQ 248.492.00 TOTAL 660.00 Fastrack Sunglass 12.Titan Industries Data Titan Value (INR) 271.365.96 McFills Data McFills Value (INR) Total 18.104.22.1680.00 Gold Studded 66.003.00 Silver 259.056.960.000.00 Silver Coins 578.98 Manoj Banshilal Pachouri 84 ICFAI Business School .624.996.00 Platinum 241.072.264.843.102.00 TOTAL 248.727.00 Tata Tea Data Tata Tea Value (INR) Total 32.350.31 Bell Ceramics Data Bell Ceramics Value (INR) Total 47.
730.072.385.00 531.286.385.350.072.98 47.464.66 112.996.597.127.017.00 8.00 211.93 1.843.471.66 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) 1.532.368.743.003.730.29 Voltas Data Voltas Value (INR) Total 177.82 660.599.538.31 20.900.960.000.00 Bharti Teletech Data Bharti Teletech Value (INR) Total 211.850.78 Manoj Banshilal Pachouri 85 ICFAI Business School .538.072.980.500.000.33 10.29 177.96 32.MICO Data MICO Value (INR) Total 531.743.
If.599.26% 0.71% 99. These cumulative percentages are used to categorize companies in A.000.286.597.69% 20.072.41% 3.017.93 1.00 211.960.97% 100.730.90% 96.900.82 660.850.Table 5: ABC Analysis .69% 64.14% 16.31 20.00% Cumulative % 44.368.44% 1. cumulative percentage is calculated for companies sorted in descending order of values.05 % of total value 44.464.843.41% 99. Cumulative percentage > 70% but < 90% => B Category Else.196.735.66 112.62% 0.31% 0.350.49% 92.532.996.69% and that of BPL Sanyo is least with 0. C Category It is evident from table that contribution of TVS motor is largest with 44. Cumulative percentage < 70% => A Category Else if.00% 0.98 47. B and C categories using formula.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.20% 6.003.34% 97.471.03% 87.03%.03% 100.78% 99.278.83% 81.538.Value Wise Company TVS Motor Titan MICO Bharti Voltas Amara Raja Bell Tata Tea McFills IM Tech MRF Paints BPL Sanyo TOTAL Value (INR) 1.00 531.127.00 8.980.78% 98.45% 1.45% 5.96 32.29 177.78 3.743.33 10. Manoj Banshilal Pachouri 86 ICFAI Business School .072.500.
25 Qty 2 614 456.2 1367.5 790.5 613.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 33396.8 1145.5 1218.5 703 589.5 1167.75 1735 1600 847.5 875 813.7 918.5 360 Qty 3 1218.75 732 611 1183.25 506 318 343 416 1400.3 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 .3 935 1531.5 1513 1485 1010.4 1181.8 1206.8 737.8 747.
146 Tanishq Jewellery Data Gold Plain 10.560 Manoj Banshilal Pachouri 88 ICFAI Business School .764 IM Technology Data IM Technology Quantity (pcs) Total 502.644 TANISHQ 26.058 Tommy Hilfiger 1.234 Platinum 17 Quantity (pcs) Quantity (pcs) PLAIN JEWELLERY WITH STONES 1.650 Silver 84 Silver Coins 4.426.440 TOTAL 366.153 Sonata 171.Titan Industries Data Titan Quantity (pcs) 155.000 Amara Raja Data Amara Raja Quantity (pcs) Total 58.440 Tata Tea Data Tata Tea Quantity (Kg) Total 277.016 Gold Plain UCP Jewellery 995 SOLITAIRE 19 TOTAL 26.93 McFills Data McFills Quantity (boxes) Total 67.635 Gold Coins 4.851 Fastrack Sunglass 11.55 Bell Ceramics Data Bell Ceramics Quantity (sq mts) Total 250.790 Gold Studded 4.340.
146 277.435 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.MICO Data MICO Quantity (pcs) Total 4. mts) Bharti (pcs) McFills (boxes) Amara Raja TVS Motor (bikes) MRF Paints (ltr) Voltas (pcs) BPL Sanyo (pcs) Quantity 4.764 58.918.341 250.625 502.560 46.000 366.625 Bharti Teletech Data Bharti Teletech Quantity (pcs) Total 146.888 Voltas Data Voltas Quantity (pcs) Total 14.918.888 67.435 644 Manoj Banshilal Pachouri 89 ICFAI Business School .396 14.427 146.668 33.
918.427 146.69% 97.396 14.Quantity Wise Company MICO (pcs) IM Tech (cards) Titan (pcs) Tata Tea (kg) Bell (sq.70% 98.60% 7.88% 0.6% and that of BPL Sanyo is least with 0.Table 6: ABC Analysis .51% 5.49% 96.99% 100.15% 3.341 250.50% 0. mts) Bharti (pcs) McFills (boxes) Amara Raja TVS Motor (bikes) MRF Paints (ltr) Voltas (pcs) BPL Sanyo (pcs) TOTAL Quantity 4.74% 94.60% 81. It is evident from table that contribution of MICO is largest with 73.668 33.48% 4.20% 1. Manoj Banshilal Pachouri 90 ICFAI Business School .894 % of total Quantity 73.01%.625 502.22% 0.77% 99.146 277.70% 0.11% 86.435 644 6.01% 0.682.01% 100.75% 2.58% 99.27% 99.560 46.888 67.59% 90. B and C categories is same as that used in aforesaid value wise ABC Analysis.00% Category A B B B C C C C C C C C Method for categorizing companies in A.00% Cumulative % 73.764 58.000 366.
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 2.057 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 .
884 Sonata 1.136 Manoj Banshilal Pachouri 92 ICFAI Business School .183 Tata Tea Data Tata Tea Transactions (No) Total 1.103 Fastrack Sunglass 357 Tommy Hilfiger 206 TANISHQ 1.Titan Industries Data Titan Transactions 2.764 IM Technology Data IM Technology Transactions (No) Total 19 Amara Raja Data Amara Raja Transactions (No) Total 4.733 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 1.183 TOTAL 5.806 Bell Ceramics Data Bell Ceramics Transactions (No) Total 4464 McFills Data McFills Transactions (No) Total 67.
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 31.926 5.MICO Data MICO Transactions (No) Total 31.929 5.605 2.806 1.057 1.926 Bharti Teletech Data Bharti Teletech Transactions (No) Total 1611 Voltas Data Voltas Transactions (No) Total 5.136 2.611 1.733 4.233 59 19 Manoj Banshilal Pachouri 93 ICFAI Business School .464 4.
75% 88.00% 0.929 5.136 2.057 1.85% 61.00% Cumulative % 51.464 4.25% 6.Table 7: ABC Analysis .93% 2. Manoj Banshilal Pachouri 94 ICFAI Business School .10% 0.733 4.611 1.47% 70.87% 99.62% 2.03% 100.32% 95.97% 100.926 5.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. B and C categories is same as that used in aforesaid value wise ABC Analysis.806 1.85% 9.25% 97.79% 78.578 % of total Transactions 51.00% Category A A A B B B C C C C C C Method for categorizing companies in A. It is evident from table that contribution of MICO is largest with 51.72% 4.233 59 19 61.03%.23% 3.03% 84.605 2.63% 9.87% 99.98% 92.31% 7.34% 2.85% and that of IM Technology is least with 0.
AS-IS ANALYSIS Process Matrices Manoj Banshilal Pachouri 95 ICFAI Business School .
Store material according to companies stacking norms 12. Disconnects mean anything that prevents the process from achieving desired results (e. Verify goods against Goods In Transit 2. Bharat Kantharia (Faculty Guide). Unload inbound material 9. Physical inspection of inbound material 5. This phase of project report summarizes the notes. Scan barcode serial numbers 6. My Mechanism: After understanding the workings and processes of Fairdeal during Organization and Processes phase. Make shortage-claim or Damages-claim 7. all the relevant documents are gathered and all the processes and sub-processes studies in previous phase are listed out which are: 1. Ltd. Intimate shortage claim or damages claim to branch office 8.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.g. Segregate material in brands and shades 10. 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. Update stock register Manoj Banshilal Pachouri 96 ICFAI Business School . and presented by me to Mr. Receiving Goods 3. This section is intended to serve as input to the process mapping. Sharad Jobanputra (Company Guide) and Mr. my next objective was to measure all the important processes. Arrange for bitumen sheets or pallets 11. facts and findings of the current business processes at Fairdeal Distribution Services Pvt. Give acknowledgement to transporter 4. Update goods in transit and current stock modules 13. flowcharting and TO-BE Analysis section. The material was collected.. analyzed. For this.
Make stack cards 15. Print invoice 29. Load material on vehicle 32. Intimate principal about scrap material 40. Make pending orders 27. Short close orders in case of shortage of goods 28.14. if required 17. Claim Octoroi claims from company 42. Intimate principal about warranty claims 39. Dispatch goods 33. Intimate customers about insufficient cash 26. Check availability of ordered goods 24. Claim transport charges from company Manoj Banshilal Pachouri 97 ICFAI Business School . Stock Maintenance 19. Check stock in warehouse after dispatching 34. Verify ordered quantity against invoice 31. Pay Octoroi if applicable 36. Re-pack material. Place stack cards on goods 16. Prepare Gate pass 30. Collect cheques from customers 23. Generate weekly and monthly reports 41. Check availability of customer’s checks with Fairdeal 25. Receive unsalable material 37. Receive orders from customers 20. Receive ‘goods received’ acknowledgement from customers 35. Receive warranty returns 38. Receive stock transfer requests 21. Re-labeling of goods 18. Punch orders 22.
process owners. Some processes are initiated outside Fairdeal and some are partially or fully controlled by outside sources like dealers and branch offices. 5. clerks. 2. 8. store keepers. Those Processes which are specific to a particular company are indicated by company name in the parentheses. All activities might not be followed in the process and some activities are alternate activities. The main processes are: 1. Manoj Banshilal Pachouri 98 ICFAI Business School . 3. Process Matrix contains activities that are undertaken in every process. All the process matrices are shown graphically also which are drawn using Microsoft Visio 2003. security guards. 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. Out of these procedures and sub-procedures. 6. Stock Maintenance These processes are general processes common to all companies handled by Fairdeal Distribution Services Pvt. Goods Receiving Storing Material Cycle Count Order Punching Order Approval Invoice/ Bill Printing/ Stock Transfer Dispatching Transportation Handling Unsalable Material 10. Handling Warranty Claims 11. These processes were then again studied and process matrices were prepared for each process. 9. This phase also includes main issues with related priorities and excerpts from interview of warehouse labours. managers. and directors of Fairdeal. 4. Ltd. 7.All the processes and sub-processes mentioned here are not under control of Fairdeal.
i. no one follows the process. or the benefit will never justify the cost. the issues were elsewhere (e.Decide on an approach Analysis of every process and its activity steps will decide the future of the process. There are five possible courses of action: • Drop/abandon: This process is not necessary.. Traditionally. infrastructure activities such as cleaning and catering. • Improve: The basic structure of the process is okay.e. or training is needed). but specific improvements are possible. Manoj Banshilal Pachouri 99 ICFAI Business School .g. • Leave as is: The process is fine. whether it will be redesigned or leaved as it. this has been the choice for generic. • Outsource: It would be a more effective use of resources to have a supplier carry out the process. • Redesign: The process should be fully redesigned.
Wait time. Cycle time. In and out time of trucks were noted down. and Working time of various processes. 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 . Note: These tables are drawn in Excel sheets and imported to word document after doing all calculations like Average. These times would be compared with industry’s ideal loading and unloading times to measure Cycle time. Following are the in and out times of some of the companies whose material come through transport vehicles. difference etc. Work time and other measures.Cycle Time. Wait Time measurements To measure Wait time.
Table 9: Loading & Unloading times in TVS (With four labors) TVS Motors Loading (20 . 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 .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.26 Bikes) IN OUT Unloading (50 .
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. Security checks at gate 4.13 hours 41 minutes 3. slow moving and non-moving goods categories. Cycle times of individual products or brands only can be calculated which is out of scope of this project. Physical inspection of material 5. 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.22 Min 2. Some of the reasons for deviations in these measures are as follows: 1. I would calculate Cycle times of individual products if time permits after completion of this project. Manoj Banshilal Pachouri 102 ICFAI Business School . Lack of space to unload material 2.33 hours 1.28 hours 1. 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.
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 .Process Matrices [Key Performance Indicators (KPIs)] Metrics. give a feel for the dynamics of the process before diving into the assessment. Metrics provide useful guidance to focus efforts and requirements. or key performance indicators (KPIs).
They can also be specially printed on labels by a dot matrix. 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).Goods Receiving Process Goods Receiving process is initiated by either transporter or courier service provider when material is brought to Fairdeal warehouse. details of the delivery note. This applies to both suppliers' and the warehouse's own vehicles. This is particularly important for goods which have been ordered for a specific purpose. Giving all drivers clear directions. like POP or promotional goods. the name of the supplier and the times of arrival and departure. Physical inspection of inbound material To enforce security at a warehouse. In the record is each vehicle's registration number. Drivers employed by external suppliers are supervised all the time they are inside the warehouse security area. Manoj Banshilal Pachouri 104 ICFAI Business School . 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. This process ends with accepting the material for storing it into warehouse. a duty officer mans a Gate Office. can be printed on package labels or cases. ink-jet or full character impact printer. Searching departing unauthorized load. This Gate Officer is responsible for: • Completing meticulous records about vehicles entering or leaving the warehouse area. 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 machine-readable format. These bar codes. Any damage or shortage has to be mentioned in the document. Scan barcode serial numbers A Bar code is a series of wide and narrow bands and spaces which represent numbers and letters.
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. Bikes are checked for battery. tool kit etc at the time of off-loading. They are linked to a computer which updates the inventory control data base.The codes are read by a light pen or a fixed-beam reader scanner. adjusting records of stock levels automatically. Supply Chain Manager (SCM) and transporter. 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. Decoders are used to record and identify goods received and goods issued. the contents are checked carefully. accessories. Manoj Banshilal Pachouri 105 ICFAI Business School . or other parties. In TVS motors. 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. This is the responsibility of the Store Incharge to sign for the receipt of the consignment. it is notified to the supplier straight away. The Depot Incharge may choose to send the goods back. The readers are interpreted by a micro-processor decoder. the first thing done is to segregate the defective unit or packages. Once the loss or damage has been verified. Unload inbound material After inspection of material is complete. Alternatively. The transporter's representative then countersigns the endorsement. Where packages are obviously damaged on the outside. He can then make a claim against the carrier. compensation has to be claimed from the insurance company according to company norms. Make shortage-claim or Damages-claim If some items are found to be missing or damaged.
In case of courier service.8 Serial numbers are scanned using cordless barcode scanner.10 Material is stored in warehouse. [Titan watches] 1. 1.277 pieces per day (300 working days) Material status from Goods in transit Module Invoice cum delivery challan.4.3 slips which are inside the carton.9 Goods received acknowledgement given to logistics person. [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. [Titan watches] Docket wise Cartons are opened and watches are checked with packing 1.11 Upload receiving status on applications like SAP R/3.2 opened before courier person.2 Area branch office is notified about arrival of material.12 Mail is sent to Supply Chain Managers. TVS bikes are checked for whether key and tool kit is with bike or not. [Voltas] STM is received from transporter or courier person containing GRN and 1. [Voltas] 1.1 against printed weight on carton. Material is manually inspected for any physical damage and accessories 1.Table 13: Goods Receiving Process Process 1 Goods Receiving Goods arrive from factory locations or other locations in case of StockActivities 1. 1. Carton will be 1. 1. 1. rear view mirror and battery is attached with bike.7 • Local ASO (Area Sales Officer) is informed.4. 1. [Titan watches] If weight of carton does not match with printed weight.5 Material unloaded from Lorry.g. In case of physical damage or short supply: • Supply Chain Manger is informed.4.1 Transfers. MFG Pro 1.6 E. 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 . • Damage claim or Shortage claim is prepared. SDNet. Individual carton is weighed and verified 1.3 outbound number.
Figure 4: Flowchart of Goods Receiving Process Manoj Banshilal Pachouri 107 ICFAI Business School .
All pallet loads are properly strapped. Bell ceramics tiles are stacked batch wise and shade wise. This ensures tracking of material on daily basis. Goods in transit module is updated and material in goods in transit module then shifts to current stock with CFA module. Stock register is helpful at the time of order punching when it is verified for stock availability. Store material according to companies stacking norms Tata tea bags and cartons are stacked in a honey comb pattern. Update goods in transit and current stock modules After goods are received. They are also marked with any information about restriction of issue. Update stock register Physical stock register is updated once material is received or dispatched from the warehouse. Manoj Banshilal Pachouri 108 ICFAI Business School . Batteries in Amara Raja are stored on pallets according to batch to ensure FIFO. 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. according to the stock control system prescribed by the principal company.Storing Material Process This process is initiated by goods receiving process and ends with storing material into scrap warehouse or finished goods warehouse. 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.
stack card is putted on it. stack card is placed in box. Stack cards can be substituted by barcode labels for better efficiency. name of brand.Make stack cards Stack cards are prepared to ensure proper maintenance and delivery of material. batch number. If material is stored on pallets. manufactured date etc. number of quantity. they are placed on goods as follows: • • • If material is stored in racks. If material is putted on bitumen sheets. Manoj Banshilal Pachouri 109 ICFAI Business School . stack card is pasted on rack. Stack card contains name of product. They are also used tat the time of safety measures and cycle count. Place stack cards on goods After stack cards are prepared.
FMCG products are stored to ascertain FEFO.2. Tiles in Bell Ceramics are stored batch wise as shades change every batch.9 2. Lorry number is noted down on seats of TVS bikes and stored brand wise.4 2.3.2 2. Stacking is done according to stacking norms of company. [Amara raja] Physical stock is verified against book value on daily basis.1 2.2 2.: nine items per stack). Stacking always is honey comb.2.2 2.g. Engine number and frame number are also noted down. Stack cards are placed on lots containing manufacturing date. Material is checked for damage.1 2. Same company goods are stored product wise. and received date to ensure FIFO.2.2. [McFills] Batteries are charged every 40 days. (e. batch number.1.4 2.1. If it is damaged material is stored separately in scrap warehouse.8 2.Table 14: Storing Material Process Process Activities 2 2.1 2.3 2. Bitumen set or pallets are used to store material as par the policy of company.10 Storing Material Separate locations are allotted for product of different companies.7 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 . Newer Titan products are stacked behind older one to ensure FIFO. Yellow lines are marked on the floor of warehouse and material has to be stored within those lines only.5 2. [Tata Tea] Titan products are stored code wise.3.6 2. Godown Incharge 4 Persons Warehouse 22.
Figure 5: Flowchart of Storing Material Process Manoj Banshilal Pachouri 111 ICFAI Business School .
Time interval varies from company to company ranging from one day to fifteen days. count the number of cartons or cases of base and multiply it by number of cartons or cases above it. Store keeper counts the physical stock as per the following rules: • If material is staked on bitumen sheets. cycle count in TVS Motor and Amara Raja is done on daily basis while in Titan there is no scheduled time for it. For instance. If material is loose. count the number of pallets and multiply the number of items per pallet to get the quantity. count all materials. If material is stored in cartons. Then multiply this number with number of pieces per carton or case to get the total quantity. If material is stocked on pallets.Cycle Count Process This process is carried out regularly at fixed intervals. count the number of cartons and multiply the number of items per carton to get the quantity. • • • • Manoj Banshilal Pachouri 112 ICFAI Business School . Very small accessories like screws are measured by weight.
6 3. Bell ceramic tiles are counted on fortnightly basis.7 3.5 3.Table 15: Cycle Count Process Process Activities 3 3. IM Technology SIM card pieces are not counted as they are crossdocked the same day. 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. Voltas home appliances are counted item wise weekly. FMCG goods in McFills are counted packs wise and carton 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.3 3. Accessory items are counted piece wise or weight wise Titan watches are not counted physically. Amara Raja batteries are counted pallet wise or item wise daily.2 3.1 3. 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 .4 3.
Figure 6: Flowchart of Cycle Count Process Manoj Banshilal Pachouri 114 ICFAI Business School .
Check availability of ordered goods When a customer places an order. Check availability of customer’s checks with Fairdeal Some principal companies like Tata tea.Order Punching Process Order punching process is initiated either by dealer or branch office. which includes Stock Transfer requests also. When customer places an order. when written or telephonic order is placed with Fairdeal. This process ends with computer operator accepting or rejecting the order. McFills and Bell ceramics require customers to keep advance cheques with Fairdeal. it is ensured that the ordered quantity is available in warehouse. Manoj Banshilal Pachouri 115 ICFAI Business School . 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. it is ascertained before punching the order that the cheques of respective customers are present with Fairdeal. This process is not controlled by Fairdeal other wise procedures of this process are similar to goods receiving process. To do so. Computer may alert insufficient cash message if customer has placed order of value greater than his credit limit. Collect cheques from customers This process is in use in Bharti Teletech. McFills. 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. Bell Ceramics and Tata tea where cheques are collected from dealers on behalf of principal companies. physical stock register is checked and verified against book value.
SAP R/3. [Voltas] NOTE: Orders are punched into Titan. Tata Tea. [Voltas. [Bharti] DD is submitted in Bank and deposit receipt obtained. [Tata Tea.3 4. Financial Accounting System (FAS) Storing Material. Physical Stock Register • Order entry not done if signed blank cheques of dealers are not with Fairdeal. Dealers can also place orders in E-Applications namely. TVS Motor. If not.1 4.4 4.2 4. SAP R/3 and SDNet. DD details punched into order received form. 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. order can not be punched into SAP R/3 Module.1. MRF Paints.1.6 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.5 4. Bharti and McFills Manoj Banshilal Pachouri 116 ICFAI Business School . Bell. Bell Ceramics. Check whether signed blank cheques of concerned dealer are available with Fairdeal or not. inform the concerned dealer. Amara Raja.Table 16: Order Punching Process Process Activities 4 4. or via phone. McFills Foods] Dataflow Documents Dataflow Documents Statutory MIS Existing Integrations Controls • If stock is not present. 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. [Tata Tea.2 4. Tata Tea] If order placed via phone it has to be punched into SDNet manually by warehouse personnel. Bell Ceramics and McFills] If company is using SAP R/3. Though pending orders can be made.
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. 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. This process ends with generating invoice number. Some of the main activities in this process are: Make pending orders If ordered material is not present in the warehouse. Manoj Banshilal Pachouri 118 ICFAI Business School .
Notification sent to dealer.Table 17: Order Approval Process Process Activities 5 5. 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. [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. Bharti and McFills Ltd.3 5.5 5.2 5.4 5. [Bharti] If stock is not present. Order is sent for verification by regional sales officer Once approved. place order at company head office. Tata Tea. Bell. Physical Stock Register DD details are must for order approving. Amara Raja. Update book stock value Stock is checked for availability in warehouse/ depot. Manoj Banshilal Pachouri 119 ICFAI Business School .10 Order Approval Stock is checked for availability in warehouse/ depot.7 5. TVS Motor. Financial Accounting System (FAS) Storing Material. order can be partial dispatched or short closed.6 5.8 5. If stock is below threshold value.9 5. dispatch order is generated on SDNet. If stock is present order is approved. Check physical stock for threshold stock.1 5. MRF Paints. SAP R/3.
Figure 8: Flowchart of Order Approval Process Manoj Banshilal Pachouri 120 ICFAI Business School .
Invoice contains product specifications along with product value.1 6.6 6. Stock transfer document is printed from ‘Stock Transfer’ menu Stock transfer decision is taken by regional sales manager.3 6.5 6.4 6. 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. bill is printed manually. raja e-ARIMS Order Punching. If SAP R/3 or any other ERP package is not being used. Invoice is printed in triplet either on company provided pre-printed stationery or on blank papers. SAP R/3.2 6. Stock transfer order is then forwarded to nearest C &FA depending on availability of stock. Table 18: Invoice/ Bill Printing/ Stock Transfer Process Process Activities 6 6. No sales tax or VAT is applicable on stock transfers as ownership of material does not change.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. 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 .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.
Figure 9: Flowchart of Invoice/ Bill Printing/ Stock Transfer Process Manoj Banshilal Pachouri 122 ICFAI Business School .
Load material on vehicle At this stage. If material. Check stock in warehouse after dispatching It is initiated by store Incharge at the time of loading material. ordered items are picked from pallets. When an order is received in warehouse. This material will be indented to factory location for replenishment.Dispatching Process Pick slip is generated and sent to warehouse for picking material. Every dispatch order and is signed by process manager. bitumen sheets. Manoj Banshilal Pachouri 123 ICFAI Business School . store Incharge intimates process manager who in turn will notify ASM and SCM. shelves or racks and assembled in the goods-out area. is found to be below a threshold value. 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. Here they are packed. 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. being dispatched. Gate pass is then prepared and material is loaded on vehicle or handed over to courier person. it is checked for the correct signature.
Physical Stock Register No order can be dispatched without proper documents like Invoice. gate pass and two copies of invoice are given to transporter. Gate pass signed by authorized person.200 pieces per day (300 working days) Dispatching details in e-application Material specification from computer operator Dispatching number Acknowledgement SDNet. Tiles are dispatched according to batch.6 7.Table 19: Dispatching Process Process Activities 7 7.7 Dispatching Take material from warehouse on the basis of FIFO or FEFO.5 7. Material is Loaded on vehicle. Financial Accounting System (FAS) Storing Material. Delivery challan. LR.1 7.2 7. Depot Incharge 15 persons warehouse 22. Responsibility People Involved Location Frequency Input Output Reports Dataflow Documents Dataflow Documents Statutory MIS Existing Integrations Controls Manoj Banshilal Pachouri 124 ICFAI Business School . Bring material from secondary location to primary location. SAP R/3. Transport vehicle is checked for gate pass and physical goods.4 7.3 7. Gate pass is made to allow goods outside warehouse.
Figure 10: Flowchart of Dispatching Process Manoj Banshilal Pachouri 125 ICFAI Business School .
Octoroi is paid on the material which is transported through its own vehicles or contracted vehicles. transporter takes goods as a proof of correct Fairdeal and one copy at the time of freight Manoj Banshilal Pachouri 126 ICFAI Business School . Purpose of this document is to keep track of the outbound material leaving the warehouse. Fairdeal pays Octoroi on behalf of its principal which it claims later. There is no obligation to pay Octoroi when customers take the delivery at warehouse premises since ownership changes at warehouse in this case. Claim Octoroi claims from company As mentioned in Pay Octoroi sub process. if applicable Octoroi is payable in select cities decided by state governments. Fairdeal pays Octoroi on behalf of its principal which it claims later. It ranges from 4% to 5% of invoice value depending on the type of the product and city in which Octoroi is payable. received acknowledgement from customer delivery. Receive ‘goods received’ acknowledgement from customers When material is supplied to a customer. 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. This document is given back to remains with transporter which is used reimbursement.Transportation Process This process is extension of dispatching process and is carried out after material is loaded on the vehicle. Pay Octoroi. store keeper and transporter. Fairdeal provides transportation to local orders where as outsourced carriers and courier service providers provide transportation to upcountry orders.
4 8.1 8. Material is unloaded at dealer’s place. Up-country orders are dispatched through transport or courier services.5 8. Gate pass signed by authorized person.6 Transportation Local orders are dispatched through Fairdeal’s own vehicles or dealers collect their order from warehouse directly. Existing Integrations Controls Manoj Banshilal Pachouri 127 ICFAI Business School .2 8.1.3 8.Table 20: Transportation Process Process Activities 8 8. Dealer returns back one signed copy of invoice as acknowledgement of goods received. Transportation Incharge 10 persons warehouse 22. goods in transit Storing Material No order can be dispatched without proper documents like Invoice. Octoroi charges are claimed from concerned company. Acknowledgement copy of invoice given back to Fairdeal.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. Octoroi is paid in metropolitan cities.2 8. Delivery challan.1.
Figure 11: Flowchart of Transportation Process Manoj Banshilal Pachouri 128 ICFAI Business School .
Transport claims includes loading and off-loading charges which vary product to product accordingly. introduction of new brands. its spares will become obsolete. if TVS motor decides to discontinue a vehicle. When scrap material dispatched to principal company through its own vehicles or contracted vehicles. when scrap material piles up above its threshold limit. Slow-moving and unsalable material categories.Handling Unsalable Material Process Material is classified into Non-moving. For instance. obsoleteness. Dealers or Stockists initiate this process when material becomes unsalable because of expiry of date. 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. Manoj Banshilal Pachouri 129 ICFAI Business School . Claim scrap transport charges from company Fairdeal has its own dedicated vehicles to deliver local orders to customers. Similarly. damage or any other reason. Fairdeal pays freight charges on behalf of principal company which it claims from them later. change in technology. Scrap items are kept separate from new items in scrap warehouse. company is notified about its removal.
3 9.Table 21: Handling Unsalable Material Process Process Activities 9 9. 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. Sales officer inspects material. After enough stock piles up.11 Handling Unsalable/ Non Moving/ Slow Moving Material Dealer claims material as Unsalable. Unsalable material is stored in scrap warehouse at different location. Material is brought back to Fairdeal warehouse along with written approval of sales officer and dealer’s letter containing material details.6 9. Area sales manager approves material as Unsalable.4 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. If material is found unsalable. sales officer recommends it to area sales manager.7 9.2 9.8 9.9 9.10 9. 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.1 9. Manoj Banshilal Pachouri 130 ICFAI Business School .5 9.
Figure 12: Flowchart of Handling Unsalable Material Process Manoj Banshilal Pachouri 131 ICFAI Business School .
service engineer approves warranty claim.2 10. 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. Company is notified about warranty claim.8 10.13 10.1 10.3 10.4 10.15 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.9 10.16 Handling Warranty Claims Customer claims product replacement under warranty from dealer. Stock is sent to company if it can be repaired or serviced. notification is sent to company Company approves removal of defected stock. New product is dispatched to dealer to replace defected one.6 10.5 10.11 10.12 10. If material is unrepairable it is considered as scrap Serial numbers of scrap material are destroyed to avoid re-claims. Defected product is stored in scrap warehouse. Product comes to Fairdeal warehouse with product specification and warranty letter signed by service engineer.7 10. Dealer notifies service engineer about warranty claim.14 10. After enough stock piles up. Service engineer inspects product. Table 22: Handling Warranty Claims Process Process Activities 10 10. Customers initiate this process when material they purchased have any prepurchase defects or is damaged under warranty period.
Figure 13: Flowchart of Handling Warranty Claims Process Manoj Banshilal Pachouri 133 ICFAI Business School .
by ensuring safety measures and by providing value added services like re-labeling. Furthermore. Others may need more specific care. Any that has been damaged or have been opened for checking are promptly repacked and sealed. Some products need special periodic attention like batteries in Amara Raja have to be checked for any leakages as they contain acids. Moisture is regulated in warehouse by building stacks which are hollow inside so that air can circulate and by turning products over periodically. Protection of material McFills products being consumable products are protected against moisture. Fire extinguishers are serviced but their schedule is not fixed. rodents and other hazardous products. repacking. TVS motorbikes which are stored on roof remain in direct sunlight for a long time. Regular checks are done for spillage and waste. reporting etc. Brass fire nozzles and foam mixer fittings are also cleaned. Manoj Banshilal Pachouri 134 ICFAI Business School . For instance. Depot Incharge inspects material on fortnightly basis by checking stack cards of material. particularly food products like McFills foods and snacks and sunfill oil from Coca Cola. Rodent preventive measures are also taken to avoid damage to warehouse stock. Physical inspection is also done to ensure that all packages in stock are kept in good condition. 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. Stock is maintained by doing physical inspection.Stock Maintenance Process Fairdeal is responsible for maintaining principal company’s stock in good marketable condition failing to which. warehouse is disinfested at regular intervals. Any rubbish or waste paper is a fire risk and is removed. Fairdeal will have to pay for the damages occurred to the stock.
Generate Reports Weekly and monthly reports are generated for the purpose of controlling. 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. In this process. tracking. Manoj Banshilal Pachouri 135 ICFAI Business School . Fairdeal claims the labeling charges as value added services later with reimbursements. company provided tape and seal are applied to it.Re-pack material. value added services claims and Clearing & Forwarding Agent reimbursements are charged on the basis of these reports. Re-labeling of goods This is value added service provided by Fairdeal to its principal companies. Apart from these. Octoroi claims. Freight claims. Fairdeal provides with the labors who will stick new labels provided by company to the material. if required If packing or carton of material is found damaged or material is required to repack for distribution. inspecting and reimbursement. these reports are also used to track inventory and movement of goods.
rodents.5 11. expiry dates. micro organisms.7 11.3 11. theft Dataflow Documents Dataflow Documents Statutory MIS Existing Integrations Controls Manoj Banshilal Pachouri 136 ICFAI Business School .1 11.4 11. FMCG goods are protected against moisture. 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. 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. Cycle count Rodents. Moisture content is controlled depending on products Fire extinguishers maintained for emergency situations Re-pack material packing or cases. Batteries are charged every 40 days in warehouse. contamination.8 11.9 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.Table 23: Stock Maintenance Process Process Activities 11 11.2 11.6 11.
Figure 14: Flowchart of Stock Maintenance Process Manoj Banshilal Pachouri 137 ICFAI Business School .
xls) format and attached to email to Company. staff time. Company has provided with a charger which can charge 32 batteries at one time. In McFills Foods. Employees should be encouraged to learn multiple (at least two) companies’ operations like SAP R/3 of Tata Tea and SDNet of Bharti Teletech. weighted in the warehouse to check uniformity of cartons. They are still using very primitive softwares. FIFO is violated. Battery must be charged every 40 days even in warehouse. Serial number is destroyed from batteries to avoid re-claims and a hole is made into battery. Motorola cartons have to be brought upstairs near computer attached barcode scanner. Inwards from Hyderabad have to be done using scanner as SAP R/3 is still not implemented there. This process can be simplified if cordless barcode scanner is used. increases waiting time and hence cycle time. To maintain FIFO. In Titan watches division Carton contains packing slip containing number of pieces and codes. In Voltas. This will ensure smooth operations of Fairdeal even in case of absenteeism or job vacancies. carton can be opened in presence of courier boy itself. Indent form is filled in Microsoft Excel (.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. Warehouse terminal data is synchronized with company data via dial up virtual private network (VPN). In Amara Raja batteries. No clear plan to manage the involvement of other participants in the processes who will be impacted. This consumes labour hours. 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 . To scan PIN and IMEI number. Current technology does not provide basic/fundamental warehouse stock information required by management. Enter PIN and IMEI number (for Motorola only) using barcode scanner. 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. Dadra material is not required to be scanned as delivery number can be used in SAP R/3 module to get all serial numbers. If weight doesn’t match. stacking is used in which new watches are placed behind old watches. Lack of group dynamics among employees.
listening skills.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 . Gate pass is mandatory for taking goods outside warehouse.
To inspect for inverted cases. To inspect whether material is stored according to FIFO norms.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. Manoj Banshilal Pachouri 140 ICFAI Business School . are using very primitive software packages which should be upgraded to better ones to increase efficiency and speed of transactions. 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. To check method of stacking material. • • Data gathered during this phase would make basis for research in next phase. To take physical stock. Computer operators complain about the lack of meaningful management information system like slow speed internet services. For example: MRF Paints and McFills Foods Pvt. There should be a separate person whose duty would be: To inspect physical location of material. pallet or bitumen sheets etc. Ltd. TO-BE Analysis. There are issues of transferring large business data through internet because of slow speed of internet connections. These connections should be upgraded to broadband connections to improve speed and quality of information sharing.
TO-BE ANALYSIS Manoj Banshilal Pachouri 141 ICFAI Business School .
Initially. Waves.Definition of TO-BE Analysis The goal of To-Be Analysis design is to produce one or more alternatives to the current situation. it was planned to take demos of some four or five warehouse management systems to get best practices from them. Sharad Jobanputra about benchmarking processes. I also discussed the issues with Mr. This phase was aimed at detailed documentation of activities being carried out in each and every process. Manoj Banshilal Pachouri 142 ICFAI Business School . TO-BE phase aims at benchmarking processes being carried out against best industry practices. To achieve this. I download 300 mb WinZip version of IntelliTrack’s Intelliwms and studied it thoroughly after installing it. They provided me with many suggestions and their usefulness about how efficiency of Fairdeal can be improved. this plan could not materialize. But due to lack of time during year-end operations in March and implementation of VAT in Gujarat from April 2006 afterwards. To compensate this. Some of the processes were benchmarked against other companies’ processes. which satisfy goals of the enterprise as stated in the business case analysis and which satisfy the change-requirements. Furthermore. This demo version gave me a lot of inputs about Kitting. AS-IS Analysis phase of this project highlighted the processes which needed either modification or re-engineering. processes were studied from various Warehouse Management Systems. dispatching process was benchmarked against Hindustan Lever Limited (HLL)’s dispatching process. I discussed all the processes with process owners and process users of every company handled by Fairdeal. Zankar Jobanputra and Mr. It was also planned to visit some other warehouses nearby so as to study their processes. Cubing and many other warehousing concepts. For instance.
rows.e. Manoj Banshilal Pachouri 143 ICFAI Business School . • Available Space (to support the Cubing feature) Calculate the space available for item storage to support the cubing feature. These items can be defined in SKUs (Stock Keepting Units). stored. including the boundaries that separate them. valuable. Assembling Warehouse Data To assemble warehouse data. This may include zones. and shipped. Warehouse must be capable enough to implement them. implementing barcode scanning. since a Warehouse operates within a dynamic environment in which material moves from receiving to storage to shipping. Also determine whether these locations accommodate all the item types. aisles. • Items Define the items the warehouse handles. In order for the warehouse to operate efficiently. following areas of warehouse operation should be reviewed: • Storage Locations All of the storage locations within the warehouse should be clearly defined. picked. or temperature controlled materials. material flow). shapes and sizes that are required. • Material Flow in the Warehouse After the usable warehouse space and item size have been determined. sequencing the replenishment and picking processes etc.. material storage and warehouse layout should be planned based upon how the goods and materials are received. and storage areas in a controlled environment for storing hazardous. identify the process by which material is moved through the warehouse (i. proper preparations should be done like creating warehouse layout.Preparation for Implementing Re-Designed Processes Before designing TO-BE processes. For this.
yellow lines can be marked on the floor to specify storing space. and Dispatching site can be coded as D-01. A-02 etc. Scrap site etc. D-02 etc to locate it easily. the warehouse space is divided into specific sites.Warehouse Layout Figure 15: Warehouse Layout Warehouse should be divided into in to different sites like Receiving site. Further. Locations are then added to each site. Bulk storing site can be coded as A-01. Dispatching site. When locations are created for a site. REC 02 etc. The following information is required to add a location. Locations reside within a ‘Site’ and are added to a site at the Locations form in WMS. Each site should be coded accordingly. For instance receiving site can be coded as REC 01. and must be entered in the Locations form in WMS: Manoj Banshilal Pachouri 144 ICFAI Business School .
• • • •
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
Vehicle details will be noted down along with the company’s name for which material has come. proper documents with quantity and service engineer’s sign should accompany the material. dealers and other staff members are also involved in it. At this stage. whichever is applicable. TVS Motors and Bharti Teletech. In case material is warranty claim or goods return under unsalable material. Material will then be checked for any physical damages and weight of cases will be taken if any possibility of pilferage is seen. barcode serial numbers should be scanned to verify that the correct material is received. This will save time at the time of dispatching and hence efficiency of dispatching process will increase. Manoj Banshilal Pachouri 149 ICFAI Business School . Fairdeal should get softcopy of Stock Transfer Memo (STM) or transfer cum delivery challan. It is because this process is not totally internal to Fairdeal and Transporter. Once material comes to warehouse. Moreover. Head office. This will save time spent in uploading barcode serial numbers in Voltas. Branch office. advance intimation will allow Fairdeal staff to prepare for the coming consignment. Gate keeper will check the material and intimate Godown keeper and process owner who will verify documents given by transporter.To-Be Goods Receiving Process Goods receiving process should be redesigned in such a manner that it takes shortest possible time.
1 1.7 1.6.3 1.2 1.8 1.g. LR receipt. Damages report.4 1.3 1.6. Material manually inspected for any physical damage and accessories E.5 1. Documents received from transporter or courier person containing material specification. shortage report if material found damaged or short respectively Manoj Banshilal Pachouri 150 ICFAI Business School . Inventory report Activities Process Steps 1.6. make arrangements for coming material. Individual carton is weighed and verified against printed weight on carton. Goods Storing. Upload Goods-In-Transit module Synchronize data of ERP module and Fairdeal WMS Main Godown Keeper WMS. • Damage claim or Shortage claim is prepared. Goods arrive from factory locations or other locations in case of StockTransfers and Goods Returns. Transporter copy of STM acknowledged. • Local ASO (Area Sales Officer) is informed. Inventory stock Can Fairdeal convince its clients to provide with integrating software? SAP and WMS data synchronized with each other.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. Material unloaded from vehicle. carton will be opened in presence of courier person. tool kit. In case of physical damage or short supply: • Supply Chain Manger is informed. rear view mirror and battery. Goods Return Note Dataflow Update Goods-in-Transit module of ERP Documents Acknowledgement to transporter Reports Stock receipt report. TVS bikes are checked for key.10 Process Owner Integration Points of Concern Wish List Additional Notes Plan labor and space required for material.1 1.2 1.9 1. Material stored in warehouse. In case of mismatch. In case of Titan. If space or labor is not sufficient. Lorry or Courier vehicle entry made in Gate Register at main gate.
Figure 16: Flowchart of TO-BE Goods Receiving Process Manoj Banshilal Pachouri 151 ICFAI Business School .
it is sorted accordingly. 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. apply taping and other fixes. Generate barcode labels for goods lot wise. scrap site or finished goods site Sort the material product wise as applicable Check material for packing and physical damage. E.e. Documents Copy of STM with material serial numbers and specifications Dataflow Barcode labels Documents Reports Physical stock register updated Current stock report. 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. 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.6 or batch wise.7 Stick barcode labels to goods or locations. Batteries. Inventory report Activities Process Steps Process Owner Integration Points of Concern Wish List Additional Notes Decide the site of material i. product wise 2.To-Be Storing Material Process After material is received in warehouse. pallet wise.2 Manoj Banshilal Pachouri 152 ICFAI Business School .8 regulations.3 or taping.1 2. 2. as applicable Store goods at their allotted locations according to company specified 2. home appliances and tiles are stored on pallets where as watches are stored in racks Depot Incharge ERP module. as required 2. If it needs repacking 2. Goods receiving.5 Scan serial numbers of finished goods and transfer them to WMS.4 Update goods specifications in WMS inventory module 2.g.
Figure 17: Flowchart of TO-BE Storing Material Process Manoj Banshilal Pachouri 153 ICFAI Business School .
expired dates. Bikes inspected for scratches.4 3.5 3. FMCG goods checked for air-leaks. Batteries physically checked for damage. embossing. where as checking for micro-organism level in foods storing location can be done monthly or quarterly. For instance. physical stock might be taken on twice a week basis. damages and Engine number slips. infestation and security issues. Battery must be charged every 40 days in warehouse.3 3. weighted in the warehouse to check uniformity of cartons.7 Sites inspected for moisture level.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. type of battery.1 3. damages. temperature. 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 . 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 3.2 3. barcode and plastic wrapping. rodents. Titan Carton checked for any physical damage and pilferage. Frequency of different types of checking can differ accordingly.
Figure 18: Flowchart of TO-BE Cycle Count Process Manoj Banshilal Pachouri 155 ICFAI Business School .
In light of reasons mentioned above. This process lies either with dealer/ distributor or Branch office of the principal company. which are then punched into ERP modules by Clearing & Forwarding agents. Most of the companies in India do not have centralized internet based order placing systems. 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. nor do dealers have sufficient IT competency and investment options to place orders online. Hence ideally. Apart form these reasons. In India. this process should not be there in Clearing & Forwarding Agent’s operations. dealers place their orders either on phone or in writing. Manoj Banshilal Pachouri 156 ICFAI Business School . 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.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.
Credit limits of dealers. whereas others have delegated it to Fairdeal.5 5. Invoice number generated Monthly sales report. 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.1 5. order is sent for verification by regional sales officer. order is accepted and approved else order can be partial dispatched or short closed. Cash report. order should not be accepted by ERP package when dealers place it. Current stock report Activities Output Dataflow Documents Reports Process Steps 5. Synchronize order approval data on WMS and ERP modules Computer Operator Pending orders. this process is only partially controlled by Fairdeal.4 5. Even in the case of companies whose order approval processes are undertaken by Fairdeal. Once approved.7 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. Dispatching.2 5. Some companies’ order approval process resides with branch office of the company itself.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. Manoj Banshilal Pachouri 157 ICFAI Business School . If company is Bharti Teletech.3 5. place order at company head office.To-Be Order Approval Process Order approval process is executed according to rules and regulations of principal company. 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.6 5.
Figure 19: Flowchart of TO-BE Order Approval Process Manoj Banshilal Pachouri 158 ICFAI Business School .
Print stock transfer memo from ‘Stock Transfer’ menu Hand over the printed document to transporter Computer Operator Dispatching. 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. It is printed in triplet for the purpose of Octoroi taxes. Stock transfer decision is taken by regional sales manager. Also. 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.2 6. Manoj Banshilal Pachouri 159 ICFAI Business School . order should not be accepted by ERP package when dealers place it. stock transfer document is similar to invoice except that it is addressed to another Clearing & Forwarding agent.1 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.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 .
8 Pick slip comes to Store keeper Material picked from locations based on predefined picking sequence or kit.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. Depot Incharge Current stock. If sufficient quantity is not present at primary location. security personnel and driver of vehicle.7 7. bring material from secondary location to primary location. If order is local. Material loaded on vehicle in presence of store keeper. 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. Security checking at main gate No order should be dispatched without proper documents like Invoice.6 7. gate pass and two copies of invoice given to transporter. 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. Labor Incharge. Octoroi amount given to transporter to be paid at toll tax point. 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 made to allow goods outside warehouse. Delivery challan.1 7.2 7.5 7.4 7.3 7. Gate pass signed by authorized person as breech in security check can prove fatal for operations of Fairdeal. LR. Manoj Banshilal Pachouri 161 ICFAI Business School .
Figure 21: Flowchart of TO-BE Dispatching Process Manoj Banshilal Pachouri 162 ICFAI Business School .
6 8. Octoroi charges and freight charges claimed from concerned company Process Owner Integration Points of Concern Wish List Additional Notes Transportation Incharge Labor Incharge. Security checking at main gate No lorry should leave warehouse without proper security checks. Upcountry orders are dispatched via contracted transporters and these transporters pay Octoroi charges which they claim monthly at the time of freight reimbursement.7 If order is local.To-Be Transportation Process As mentioned in AS-IS Analysis phase. 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 .5 8.3 8. Local orders are dispatched through Fairdeal’s own vehicles and Octoroi charges are also bore by Fairdeal.2 8.1 8. use Fairdeal’s own vehicles else use outsourced carrier. 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.4 8. Loaded vehicle leaves warehouse after security check Octoroi paid in metropolitan cities. 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.
Figure 22: Flowchart of TO-BE Transportation Process Manoj Banshilal Pachouri 164 ICFAI Business School .
and hence.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. Hence. Though. Manoj Banshilal Pachouri 165 ICFAI Business School . 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. if time permits. are controlled by them. I would work on these processes after my main study is complete. These processes are handled on behalf of principal companies.
adding to it. 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. Manoj Banshilal Pachouri 166 ICFAI Business School . 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. 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.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. To preserve the quality of stored goods. there is a risk of damage by microorganisms. the moisture content should be controlled. McFills food bags must be kept at a certain relative humidity and temperature. warehouse must be disinfested on monthly basis. Furthermore. TVS motorbikes must not remain in direct sunlight for a long time as their seats may rip apart. Rodent preventive measures could be taken on quarterly basis. Furthermore. Depot Incharge should inspect material on fortnightly basis by checking barcode labels of material to determine slow-moving material and unsalable material. unambiguous instructions must be given to packing team about how the packages should be marked. If the level of moisture is allowed to exceed the stated safety limit for storing a product.
11.6 Fire extinguishers maintained for emergency situations 11.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. micro organisms. if pilferaged during storing Re-label packs or glue stickers to packs for promotional schemes 11.4 Batteries are charged every 40 days in warehouse. inspecting 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. 11.8 under value added services Generate reports for the purpose of controlling. Bikes are inspected for scratches and damages.9 and reimbursement of stock maintenance Depot Incharge Current Stock module No lorry should leave warehouse without proper security checks.2 Manoj Banshilal Pachouri 167 ICFAI Business School .7 Re-pack material packing or cases. rodents. FMCG goods are protected against moisture.1 11.5 Moisture content is controlled depending on products 11. tracking. Fairdeal’s own vehicle are provided additional amount for fuel and maintenance while contracted vehicles charge freight charges on monthly basis 11.3 contamination. 11.
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 .
operational flexibility and strong back up and safety measures to avoid any misuse and loss of data. Replication is simply the process of sharing data between databases in different locations. it is planning to have pan India presence and is expanding. In other words. Fully Integrated WMS should be totally linked to all financial modules. Multi-branch support WMS should support remote multi-branch operations and help sharing information between the Head Office and the institution’s branches. Also. euro & dollar support. combined with an extensive array of international management features. management of receivables from clients and payments to suppliers on pre-defined due dates will be easier with Accounts Receivable and Accounts Payable modules. performance integrity. to manage a global enterprise while complying with a wide variety of national accounting standards worldwide is also required. support for value-added taxes. 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 . Fairdeal can use this option as has operations in Ahmedabad. Bangalore. it means that information is all accurate and up-to-date in every location. document and report to management the merits and demerits of implementing warehouse management system in Fairdeal.Characteristics of an Ideal WMS As ultimate objective of this project is to analyze. Multi-currency support with main local currencies. Hosur and Surat. Therefore. Dehradun. from consolidation routines to automatic generation of inter-company transactions. it would be relevant here to discuss characteristics of an ideal WMS. LAN or WAN networks can be used to provide multi-branch support. WMS should replicate data. reliable information management. A modern WMS should have powerful computational tools. like the customers and financial information. to make the data available to all the institution locations or entities.
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.Third Party Catalog Third party accounts (Customers. This feature is important for segregation in order to provide exceptional reporting flexibility. contact information. Depending on the business relation with the organization. Forwarders and Shipping Agencies) should be created as contacts in the address book. 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. 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. They provide an important feature to streamline cash flow process and help saving money. This direct entry facilitates the management and tracking per container and per client of single and consolidated shipments. main business. a contact should be identified as a supplier. Shippers. The client credit limit should be controlled when preparing a sales order or a direct invoice. a vendor or both at the same time. Credit Limits & Payment Terms A well planned WMS should provide a flexible definition of the credit conditions. where required. like the credit limit or payment terms. full address including the default dealing currency help in answering the information needs and improving the vital relationship with the third party’s organization. to accommodate with a diverse customer and vendor base. Contact name. Salesmen/Collectors. Third Party Information Third parties should be classified by categories. Manoj Banshilal Pachouri ICFAI Business School 171 . Debit limit and terms of payments are defined per supplier.
). insurance.e. Cost/profitability reports should also be generated later on for any file (i. If additional expenses need to be added to a closed file. duties etc. fire. parent or child) or for a parent file and all its amendments.) and others that cannot (i. Once all Forwarding and Clearing expenses are processed and invoiced.User Defined Cost Elements In Clearing and Forwarding. the file could be re-opened or an amendment file should be created. Security WMS should ensure that the right to use all crucial business processes is secure. is also available. Invoicing The system should allow the option to print two separate invoices. the Client File could be closed. 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. Manoj Banshilal Pachouri 172 ICFAI Business School . one for the expenses that cannot be invoiced and the other for the ones to invoice. customs. Groups can be assigned different authority levels that filter the rights of each user belonging to a group.e. Security groups can be created to restrict access to specific functions. should not affect the Expenses and Revenues Ledgers. Effective tools must be provided to manage security and provide users with a secure access to Clearing & Forwarding. 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. water or any unforeseen natural calamity. the cost elements can be classified into items that can be invoiced (i. When posted to the Financial Systems. items that cannot be invoiced and are billed at cost. The user can create an unlimited number of user-defined cost elements.e. freight etc. and thus should not influence the turnover of the company.
customer. the system should be able to generate the following. 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. for a specific client and a specific shipment. utilizing most of the standard supported data types. invoice status. like ASCII. Furthermore. periodic analysis reports: • • • • • • • • Tracking of expenses by date. per file Total sales by salesman Manoj Banshilal Pachouri 173 ICFAI Business School . 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. inclusive but not exhaustive.
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. it is difficult to implement all HR practices for them. 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. ABC Analysis. there are many issues that should be taken care of to improve its efficiency. every employee will meet them and there will be no utility of setting variable salary. Manoj Banshilal Pachouri 174 ICFAI Business School . Salaries are decided based on designation and years of work experience of employee.Suggestions and Recommendations Detailed study of operations of Fairdeal during Process Analysis. 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. 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. Current Status: This issue has already been taken up by management and it is planned to implement variable salaries from year 2006. Clearly measurable targets should be defined and communicated to employees which would be basis for deciding incentives and bonuses of individual employee. Salary Structure of Employees Presently. 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. Some of the issues which need management attention are discussed below with possible suggestions and recommendations.
Recommendation: Formal training sessions should be arranged by experienced trainers arranged either by Bharti Teletech or Fairdeal. Recently in April 2006.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. Sunil Patel resigned from the job. This consumes manpower as well as time in carrying the cases from one place to other. 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. The operations which were handled by him alone could not be handled by Manoj Banshilal Pachouri 175 ICFAI Business School . These sessions should be off-the job type as well as on-the job type. Since there is only one computer operator and one Godown keeper in most of the companies. Current Status: Pending Multi-company operations Fairdeal’s employees are specialized in one company operations only. Zankar Jobanputra. smooth operations of Fairdeal are disturbed when computer operator of Godown keeper is at leave. They have learnt it by R&D and trail and error methods. COO of Fairdeal. Training to Computer Operators No formal training is given to SDNet operators in Bharti Teletech. Operations in such situations are handled either by process owner or by 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 issue was highlighted in Bharti Teletech when its computer operator Mr. 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.
This will ensure smooth operations even in case of absenteeism and job vacancies.g. New employees will learn better than those who have been working for a long time on single SD network. COO. Sharad Jobanputra had to scan serial numbers himself. there should be another employee in Fairdeal who is at least 80% efficient. Manoj Banshilal Pachouri 176 ICFAI Business School .process owner. 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. This will reduce human errors as well as increase efficiency of receiving and dispatching also. there are human errors in noting down numbers because of confusion in 0 & 8. in handling absent employee’s work. Current Status: This issue has been communicated to TVS head office at Hosur and barcode scanners are soon to be implemented. 3 & 8 which look similar when printed by dot matrix printer. Area Sales officer and Logistic peoples like truck drivers etc) as well as dealers and Stockists. Also. For example: if one employee is absent or quits his job. It has been seen that some employees lack courtesy and communication skills. Noting down serial numbers of bikes in TVS Motor When serial numbers and frame numbers of TVS bikes are noted down manually. encouraged and trained to behave courteously with channel partners (e. Sales officer of Bharti Teletech and even Mr. Current Status: Initiatives have been taken to impart multi-operational skills in employees. Recommendation: Cordless barcode scanner can be used to scan serial numbers instead of doing it manually. if not more. Investing COO time or process owner’s time in such activities is not advisable for development of a company. Employees can be allotted to one company’s operations and one secondary companies working can be taught to him at the time of joining. 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 also happens because of scratches on barcode labels or insufficient lighting.
bikes are brought downstairs when space is available. a bike fell off the loading track and there was severe damage to both labor and bike. Direct heat in summer damage seats of bikes and shining of paint fades away. Though these damages were sometimes claimed from outsourced labor contractor. a lift can be used to substitute stairway. in TVS Godown. there are instances of damages to bikes at the time of loading. measures should be taken to avoid these types of human errors. It is noted that sometimes bikes are loaded on transport vehicles by riding them. During one such loading. 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.Damages in TVS Motor at time of Loading In TVS Motor. 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. Further. 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. Recommendation: To ensure proper loading of vehicles. Current Status: Waiting for management’s approval Manoj Banshilal Pachouri 177 ICFAI Business School . Recommendation: A new straight stairway should be constructed which should be properly grilled to avoid any accident. To prevent these damages. It is a time consuming process and costs Fairdeal in form of money and labor hours. It is to be noted that this stairway. Company regulations of vehicle loading must be strictly followed according to which bikes are loaded by dragging them from handle.
Bikes are only unloaded when some bikes are dispatched to dealers and space is created. Hence if transporters can intimate 24 hours before arriving warehouse. Lorries have to wait for a long time to unload bikes as there is no space in warehouse to store them. My personal interview with warehouse staff and computer operators revealed that juniors are not getting co-operation form seniors. Current Status: Both computers have been connected through LAN. it does not have any adverse effect on Fairdeal’s operations. Recommendation: These computers should be connected to each other through network connection. it consumes transporter’s time and resources. one for SAP R/3 operations and other for assistant works. Although. Though. This will help Fairdeal in arranging for bikes space and avoid parallel unloading. Suggestions: Information sharing should be encouraged in Fairdeal. data has to be transferred using Floppy disks from one machine to another. Current Status: Matter forwarded to management Manoj Banshilal Pachouri 178 ICFAI Business School .Interconnectivity of computers in TVS Motor TVS division has two computers. Seniors are afraid of sharing information with juniors because they are afraid of loosing referent power over juniors. As of now. Suggestion: Transporters should be encouraged to intimate Fairdeal in advance about their arrival. it will be beneficial for both transporter and Fairdeal. Preparation for space for goods in transit in TVS Motor Many a times. it is not possible to get the exact date and time of arrival. Fairdeal can get arriving consignment from goods in transit module of SAP R/3. Current Status: Status quo Lack of group dynamics There is no group dynamics and feeling of team work among employees working for different companies.
Current Status: Status quo Manoj Banshilal Pachouri 179 ICFAI Business School . Also. these boxes are then opened and watches are verified for number of pieces per code. Adding to it. These barcode labels will get the number of watches code wise. This is a bottleneck as a lot of time is consumed in maintaining non-moving and unsalable material. Single person is handling computer operations as well as store for McFills. If weights are found normal. storing and maintaining it. Note: This is already being practiced in Bharti Teletech for Motorola mobiles. boxes are weighted and verified against printed weights on boxes. Suggestions: Sales returns and unsalable material should be sent back to company as soon as possible. chances of human errors are also there in taking down incorrect code.000 pieces are received in a single transaction. 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.Goods Receiving in Titan When material is received in Titan. Recommendation: Box must not be opened and barcode scanner should be used to scan barcode labels which are printed on box itself. This material consumes time in segregating material. Moreover. This is a time consuming process as sometimes more than 10. Though transaction volume is comparatively lower it is creating problems for customers as computer operator is not available when he is in store. Current Status: Discussions in progress with management Goods Returns in McFills There are more sales returns in McFills compared to any other company.
Obsolete softwares in McFills and MRF Paints McFills and MRF Paints are using very primitive software which has erroneous entries. There is severe problem in sending attachments to company administration also as uploading speed of internet is slow. Apart from that. there is problem of uploading these files. Current Status: Discussions going on with principal companies Material Indentation in McFills Material is indented by Mr. It is not in position to implement VAT through its software. For example: when file attachments of more than 2 mb are to be sent to McFills head office. McFills and MRF paints are using dial up connections for information sharing. Their online portals use utilities which require high speed broadband connection. Current Status: Status quo Speed of Internet Connections Bell Ceramics. Bharat in McFills which is responsibility of Area Sales Manager and not of CFA personnel. McFills data cannot be audited from software as most of the quantities are showing negative stock. Suggestions: Fairdeal should ask these companies to implement broad band connections. 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. Suggestions: This activity can be annulled. At such times. Recommendations: Fairdeal should communicate this issue with its principal companies. cost of any erroneous transaction is bore by Fairdeal. MICO. computer operator has to wait for off-time when internet connection speed is relatively more.
Since. Paper work is major mode of communication with dealers and principal companies which is again a time consuming and costlier process. 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. Hosur. Warehouse rents. Recommendations: There should be preplanned arrangement of labors and storing space to avoid wait time. This process can be annulled if WMS can be implemented as most of the reports can be generated from it directly. a minimum number of labors are required to unload the truck. Reports of reimbursements for value added services like re-labeling. failing to which material can not be unloaded. 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. Current Status: Management has taken up this issue with utmost priority and negotiations are in progress with WMS vendors. Octoroi claims. Voltas and TVS Motor products require more than one labor for a single item. In long run. re-packing. It will reduce paper costs and processing times as well. this WMS can be extended to other locations of Fairdeal like Surat. Recommendations: WMS should be implemented as soon as possible as it will automate most of the processes. All divisions will be integrated and it will be possible to use data of one division in another. Dehradun and Bangalore also. Manoj Banshilal Pachouri 181 ICFAI Business School . Moreover.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. freight charges. labor charges etc are prepared into Microsoft Excel sheets and printed.
Project Activity-Time Schedule Table 34: Project Activity-Time Schedule Activity Code 01 Activity Description Study org. 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 .
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 .
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 .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.
Vinod Mr. Sunil Patel Mr. Tushar Mr. Santosh Ms. Komal Mr. Mohan Mr. Devadutt Mr. Zankar Mr. Vinod Ms. Raman Mr. Mitesh Shah Mr. Hemant Thakkar Mr. Anal Ms. Saurabh Mr. Bharat Mr. Shabbir Mr. Praveen Mr. Singh 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 .APPENDICES APPENDIX A: Key staff involved in the project Table 37: Key Staff Involved In the Project Contact Mr. Narendra Mr. P.
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 .
in) 2. 2004 Manoj Banshilal Pachouri 194 ICFAI Business School . Fairdeal Distribution Services Pvt..ac.REFERENCES Bibliography 1. Ph.Sales and Distribution by Tata McGraw Hills publication 5. Mar 01. 3PL is Growing . documents and manuals 3. 10. SAP R/3 . Mayer. User manuals & catalogs of IntelliTrack Warehouse Management System software. ICFAI Business School SAP R/3 study material 4. iimcal_paper. White paper DELIVERING RESULTS: EVOLVING BPR FROM ART TO 7. Monday.pdf: A Survey of the Third-Party Logistics (3PL) Service Providers in India by Subrata Mitra (subrata@iimcal. SAP R/3 – Material Management by Tata McGraw Hills publication 6. Ltd.The Hindu Business Line. ENGINEERING by Richard J. 8.berkeley.D.edu) 9. Associate Professor of Department of Industrial Engineering Texas A&M University. White paper Business Process Analysis  by Bob Glushko (glushko@sims.
voltas. http://www.uk/webfiles/national/projects/Ryogen http://www. http://en.za/ http://www.Internet Sources 1. http://www.tata.localegovnp. http://www.com 12. http://www.fairdeal. http://www.com.doh.mrf.tata.com/titan/index.com/ 19. http://www.htm 10.lb Manoj Banshilal Pachouri 195 ICFAI Business School .com 22. http://www.com/ 18. http://www.htm http://www.uk/pharma/docs/sup_chain/03_Phase% 202%20Report%201pasav2.logisticsfocus.gov. 5.titanworld.uct.softwaredesign.1. http://www.com/ http://www. 4.fairdealdistribution.za/ 15.com http://www. http://web.ac.intelliTrack.org/wiki/Warehouse_management_system/ 16.wikipedia.web.uct.com:9080/ 13.com/ http://www. 2.com 11. 9.com/voltas/index. 6.org http://www. 3. http://www.pdf 21.bestwms.tatatea. 7.com/ 20. http://localhost/bs/ 14.net/ 17.org.about.logisticsfocus. 8.informationweek.com http://www.pasa. http://www.beetel-india.ac.
we mean anything that prevents the process from achieving desired results (e. Bar Code Labels: Labels that use bar code symbols to capture inventory information. inconsistency between the functions of a process that cause failings of the existing process to achieve its intent. With this information. 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’. or for radical change in. inventory managers can focus on increasing those inventory SKUs with the greatest potential positive return for the organization.. As-Is Analysis: As-Is Analysis phase of BPR is aimed specifically at identifying disconnects within existing business processes and their specified intent. Only difference between invoice and bill is that while bill is raised in case of cash purchase. Activity Based Costing: An accounting method that enables a business to better understand how and where it makes a profit. These labels can be created within the WMS application or a separate bar code application. such a process.) The steps taken to describe the AS-IS process also includes a documentation of the sequence in which activities are performed. Business Process Reengineering: It is a methodology for either significant improvement to a business process. By disconnects. Bill: It is a printed document like Invoice which contains product specification along with its value. Barcode Scanner: An instrument used to decode information coded in parallel bars format and labeled to products.g. It categorizes inventory by its highest value and greatest volume. or complete replacement of.GLOSSARY ABC Analysis: ABC Analysis is an inventory management tool based on the tenets of Pareto Analysis. Manoj Banshilal Pachouri 196 ICFAI Business School .
good or articles. Cycle Count: It is regularly scheduled inventory count that cycle through inventory. Manoj Banshilal Pachouri 197 ICFAI Business School . It is generally raised when goods are sold on credit or when instant money transfer is not involved. Courier agency: It is a commercial concern engaged in the door-todoor transportation of time-sensitive documents. because it is the time that would pass on the calendar or clock on the wall during the cycle. to carry or accompany such documents.Central Warehousing Corporation (CWC): CWC is under the Ministry of Food and Civil Supplies. It is complemented by 16 State Warehousing Corporations (SWC). 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. Together. or wall-clock time for shorter cycles. Challan: Challan is a printed document containing description of products sold or transferred. Computerized Truck Routing: method of using computers to generate truck routes based on stop locations. delivery appointments and backhauls. It is sometimes called calendar time. from the time the cycle starts or is triggered until the cycle completes with all results accomplished. either directly or indirectly. It attempts to maximize productivity through restructuring and reorganizing the different divisions and departments in the organization FEFO: Abbreviation of First Expiry First Out. end to end.515 warehouses which are spread all over the country. as opposed to putting the item into a storage location. Cycle time: It is the total elapsed time. the CWC and the SWC have a monopoly in overseeing a network of 1. goods or articles utilizing the service of a person. It is a stacking practice in warehousing non-durable products which aims at ensuring that material that is expiring first is dispatched first. Cross Docking: Cross docking enables an operator to place newly received inventory directly into a staging area.
Invoice: Invoice is a printed document containing description of products sold along with their value.FIFO: Abbreviation of First In First Out. the process is just waiting. It is raised after challan and contains value of product also. Additionally. 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. 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. or just because the process is designed that way. product expired etc. of varying quantities. pallets improve inventory tracking and control efficiency when moving large amounts of material (same or unlike items) around the warehouse. Kitting: A ‘kit’ represents a preset group of items. Queue time: It is the time an item is lined up before a critical or bottleneck resource. Octoroi: It is a tax levied by Municipal Corporations of Metropolitan cities on goods purchased or used inside Municipal Corporation region. partially finished goods will stack up before a bottleneck machine during queue time. Idle time: During idle time. but is waiting for the resources for the next step to get to it. Manoj Banshilal Pachouri 198 ICFAI Business School . perhaps because the work is not on a critical path. or because it has not been routed expeditiously. it is possible to move large amounts of inventory at once. It is a stacking practice in warehousing which aims at ensuring that material that is stored first is dispatched first. In a manufacturing environment. These materials occupy a significant amount of space in the warehouse. if pallets are used. Because they are portable. Pallet: Pallets provide an alternate storage area for inventory. When the kitting process is used in the warehouse management system. The work item is ready to go on.
Invoice is used in transferring material when change of ownership is involved. Staging Area: Area in the warehouse from which goods are shipped. distribution. 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. Supply Chain Management is interplay of all the functions and integrates marketing. 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. planning. Setup time: It is the time required for a resource to switch from one type of task to another. When an item having RFID tag passes through electromagnetic zone of RFID. Supply Chain: supply chain may be defined as ‘Flow of materials through procurement. manufacture. distribution and purchases with the entire manufacturing process. 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. Manoj Banshilal Pachouri 199 ICFAI Business School . 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. an antenna captures the information from this tag and passes this information to central computer. sales and disposal’. 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.Radio Frequency Identification: Known as RFID in short. Stock Transfer Memo: This document is used in transferring material from one location to another when change of ownership is not involved.
Units of measure define a base unit of measurement such as each. 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. when the work is being moved. It consists of air-leaked packets. Warehousing: It is the part of materials management concerned with the storage of the kind and quantity of goods that consumers and users require. but no other value is being added other than transport. WIP: Work In Progress. which satisfy goals of the enterprise as stated in the business case analysis and which satisfy the change-requirements.SWOT Analysis: It is an analysis tool that forces decision makers to look their strengths. weaknesses. bundle. To-Be Analysis: The goal of To-Be Analysis design is to produce one or more alternatives to the current situation. Its goal is to increase retail inventory turns and reduce stock outs. damaged packets. If only one person at a time works on the process. Time worked: Time worked counts the actual work hours of work expended on the process. that is a step in itself. Strictly speaking. expired packets etc. Manoj Banshilal Pachouri 200 ICFAI Business School . 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. 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. Transit Time: It is the time spent in transit between steps. and case. opportunities and threats associated with their business environments. and then higher increments of the base unit such as carton. work time and time worked are the same. Unsalable Material: This term unsalable material is widely used in FMCG goods and non durable goods.
Most processes have at least some time during which processes are waiting and not being worked on. cycle time and work time would be the same. jobs.Workflow: Workflow integrates the entire organization with flexible assignment of tasks and responsibilities to locations. groups. if all this non-productive time could be eliminated. Work time: It is the time the process is actually being worked on. positions.END OF REPORT --- Manoj Banshilal Pachouri 201 ICFAI Business School . It integrates every employee in the 'value chain' by providing a versatile inbox (universal inbox) at his or her workplace. or individuals. which can be configured individually. --.
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