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  • Pantaloon

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    Amar Hegde
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    free cae study papaer on quality control system; The Theory of Constraints (TOC) Strengthening Your "Weakest Link" Chain with a weak link. Manage your weakest link. © iStockphoto/hometowncd No matter what industry you work in, there is often scope for boosting overall performance. A great way of doing this is to identify and eliminate "bottlenecks," or things that are holding you back. So how do you identify these bottlenecks? One approach is to use the Theory of Constraints (TOC). This helps you identify the most important bottleneck in your processes and systems, so that you can deal with it and improve performance. In this article, we'll explore the Theory of Constraints, and we'll look at how you can apply it to your own situation. Understanding the Theory You've likely heard the adage, "A chain is only as strong as its weakest link," and this is what the Theory of Constraints reflects. It was created by Dr Eli Goldratt and was published in his 1984 book "The Goal." According to Goldratt, organizational performance is dictated by constraints. These are restrictions that prevent an organization from maximizing its performance and reaching its goals. Constraints can involve people, supplies, information, equipment, or even policies, and can be internal or external to an organization. The theory says that every system, no matter how well it performs, has at least one constraint that limits its performance – this is the system's "weakest link." The theory also says that a system can have only one constraint at a time, and that other areas of weakness are "non-constraints" until they become the weakest link. You use the theory by identifying your constraint and changing the way that you work so that you can overcome it. The theory was originally used successfully in manufacturing, but you can use it in a variety of situations. It's most useful with very important or frequently-used processes within your organization. Applying the Theory Let's look at a step-by-step process for using the theory: Step 1: Identify the Constraint The first step is to identify your weakest link – this is the factor that's holding you back the most. Start by looking at the processes that you use regularly. Are you working as efficiently as you could be, or are there bottlenecks – for example, because your people lack skills or training, or because you lack capacity in a key area? Here, it can help to use tools like Flow Charts , Swim Lane Diagrams , Storyboarding , and Failure Modes and Effects Analysis to map out your processes and identify what's causing issues. You can also brainstorm constraints with team members, and use tools like the 5 Whys Technique and Root Cause Analysis to identify possible issues. Remember that constraints may not just be physical. They can also include intangible factors such as ineffective communication, restrictive company policies, or even poor team morale. Also bear in mind that, according to the theory, a system can only have one constraint at a time. So, you need to decide which factor is your weakest link, and focus on that. If this isn't obvious, use tools like Pareto Analysis or Queuing Models to identify the constraint. Step 2: Manage the Constraint Once you've identified the constraint, you need to figure out how to manage it. What can you do to increase efficiency in this area and cure the problem? (Goldratt calls this "exploiting the constraint.") Your solutions will vary depending on your team, your goals, and the constraint you're trying to overcome. For example, it might involve helping a team member delegate work effectively, modifying lunch breaks or vacation time to make workflow more efficient, or reorganizing the way that a task is done to make it more efficient. Here, it's useful to review approaches used in Lean Manufacturing , Kanban , Kaizen , and the 5S System to see if these can help you manage y

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    free cae study papaer on quality control system; The Theory of Constraints (TOC) Strengthening Your "Weakest Link" Chain with a weak link. Manage your weakest link. © iStockphoto/hometowncd No matter what industry you work in, there is often scope for boosting overall performance. A great way of doing this is to identify and eliminate "bottlenecks," or things that are holding you back. So how do you identify these bottlenecks? One approach is to use the Theory of Constraints (TOC). This helps you identify the most important bottleneck in your processes and systems, so that you can deal with it and improve performance. In this article, we'll explore the Theory of Constraints, and we'll look at how you can apply it to your own situation. Understanding the Theory You've likely heard the adage, "A chain is only as strong as its weakest link," and this is what the Theory of Constraints reflects. It was created by Dr Eli Goldratt and was published in his 1984 book "The Goal." According to Goldratt, organizational performance is dictated by constraints. These are restrictions that prevent an organization from maximizing its performance and reaching its goals. Constraints can involve people, supplies, information, equipment, or even policies, and can be internal or external to an organization. The theory says that every system, no matter how well it performs, has at least one constraint that limits its performance – this is the system's "weakest link." The theory also says that a system can have only one constraint at a time, and that other areas of weakness are "non-constraints" until they become the weakest link. You use the theory by identifying your constraint and changing the way that you work so that you can overcome it. The theory was originally used successfully in manufacturing, but you can use it in a variety of situations. It's most useful with very important or frequently-used processes within your organization. Applying the Theory Let's look at a step-by-step process for using the theory: Step 1: Identify the Constraint The first step is to identify your weakest link – this is the factor that's holding you back the most. Start by looking at the processes that you use regularly. Are you working as efficiently as you could be, or are there bottlenecks – for example, because your people lack skills or training, or because you lack capacity in a key area? Here, it can help to use tools like Flow Charts , Swim Lane Diagrams , Storyboarding , and Failure Modes and Effects Analysis to map out your processes and identify what's causing issues. You can also brainstorm constraints with team members, and use tools like the 5 Whys Technique and Root Cause Analysis to identify possible issues. Remember that constraints may not just be physical. They can also include intangible factors such as ineffective communication, restrictive company policies, or even poor team morale. Also bear in mind that, according to the theory, a system can only have one constraint at a time. So, you need to decide which factor is your weakest link, and focus on that. If this isn't obvious, use tools like Pareto Analysis or Queuing Models to identify the constraint. Step 2: Manage the Constraint Once you've identified the constraint, you need to figure out how to manage it. What can you do to increase efficiency in this area and cure the problem? (Goldratt calls this "exploiting the constraint.") Your solutions will vary depending on your team, your goals, and the constraint you're trying to overcome. For example, it might involve helping a team member delegate work effectively, modifying lunch breaks or vacation time to make workflow more efficient, or reorganizing the way that a task is done to make it more efficient. Here, it's useful to review approaches used in Lean Manufacturing , Kanban , Kaizen , and the 5S System to see if these can help you manage y

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    12 views3 pages

    Pantaloon

    Uploaded by

    Amar Hegde
    free cae study papaer on quality control system; The Theory of Constraints (TOC) Strengthening Your "Weakest Link" Chain with a weak link. Manage your weakest link. © iStockphoto/hometowncd No matter what industry you work in, there is often scope for boosting overall performance. A great way of doing this is to identify and eliminate "bottlenecks," or things that are holding you back. So how do you identify these bottlenecks? One approach is to use the Theory of Constraints (TOC). This helps you identify the most important bottleneck in your processes and systems, so that you can deal with it and improve performance. In this article, we'll explore the Theory of Constraints, and we'll look at how you can apply it to your own situation. Understanding the Theory You've likely heard the adage, "A chain is only as strong as its weakest link," and this is what the Theory of Constraints reflects. It was created by Dr Eli Goldratt and was published in his 1984 book "The Goal." According to Goldratt, organizational performance is dictated by constraints. These are restrictions that prevent an organization from maximizing its performance and reaching its goals. Constraints can involve people, supplies, information, equipment, or even policies, and can be internal or external to an organization. The theory says that every system, no matter how well it performs, has at least one constraint that limits its performance – this is the system's "weakest link." The theory also says that a system can have only one constraint at a time, and that other areas of weakness are "non-constraints" until they become the weakest link. You use the theory by identifying your constraint and changing the way that you work so that you can overcome it. The theory was originally used successfully in manufacturing, but you can use it in a variety of situations. It's most useful with very important or frequently-used processes within your organization. Applying the Theory Let's look at a step-by-step process for using the theory: Step 1: Identify the Constraint The first step is to identify your weakest link – this is the factor that's holding you back the most. Start by looking at the processes that you use regularly. Are you working as efficiently as you could be, or are there bottlenecks – for example, because your people lack skills or training, or because you lack capacity in a key area? Here, it can help to use tools like Flow Charts , Swim Lane Diagrams , Storyboarding , and Failure Modes and Effects Analysis to map out your processes and identify what's causing issues. You can also brainstorm constraints with team members, and use tools like the 5 Whys Technique and Root Cause Analysis to identify possible issues. Remember that constraints may not just be physical. They can also include intangible factors such as ineffective communication, restrictive company policies, or even poor team morale. Also bear in mind that, according to the theory, a system can only have one constraint at a time. So, you need to decide which factor is your weakest link, and focus on that. If this isn't obvious, use tools like Pareto Analysis or Queuing Models to identify the constraint. Step 2: Manage the Constraint Once you've identified the constraint, you need to figure out how to manage it. What can you do to increase efficiency in this area and cure the problem? (Goldratt calls this "exploiting the constraint.") Your solutions will vary depending on your team, your goals, and the constraint you're trying to overcome. For example, it might involve helping a team member delegate work effectively, modifying lunch breaks or vacation time to make workflow more efficient, or reorganizing the way that a task is done to make it more efficient. Here, it's useful to review approaches used in Lean Manufacturing , Kanban , Kaizen , and the 5S System to see if these can help you manage y

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    of 3

    Pantaloon: ERP in retail

    Needing an organisation-wide IT solution to help it perform better, Pantaloon decided to


    implement an ERP system from SAP. By Kushal Shah
    More than eight years after it forayed into the
    retail business, Pantaloon Retail decided to implement SAP
    to keep itself competitive in the rapidly growing Indian
    retail market.
    Store operations have never been as
    important to retailers as they are now.
    Successful retailers are those who know
    that the battle for customers is only won at
    the frontline, which in the case of a retail
    chain is at its stores. Pantaloon was
    regularly opening stores in the metros and
    there was an urgent need for a
    reliable enterprise wide application to help run its business effectively. The basic need
    was to have a robust transaction management system and an enterprise wide platform
    to run the operations, says Rakesh Biyani, Director, Pantaloon. The company was
    looking for a solution that would bring all of its businesses and processes together. After
    a comprehensive evaluation of different options and software companies, the
    management at Pantaloon decided to go in for SAP.
    The Solution
    Some of the qualities of SAP retail solutions are that it supports product development,
    which includes ideation, trend analysis, and collaboration with partners in the supply
    chain; sourcing and procurement, which involves working with manufacturers to fulfil
    orders according to strategic merchandising plans and optimise cost, quality, and speed
    variables that must be weighted differently as business needs, buying plans, and market
    demand patterns change; managing the supply chain, which involves handling the
    logistics of moving finished goods from the source into stores and overseeing global
    trade and procurement requirements; selling goods across a variety of channels to
    customers, which requires marketing and brand management; managing mark-downs
    and capturing customer reactions, analysing data, and using it to optimise the next
    phase of the design process.
    In a Nutshell
    Aim : To deploy a robust transaction
    management system and an
    enterprise-wide platform to run its
    operations.
    Solution : SAP retail solution
    Implemented by : SAP team with the help of Novasoft,
    Singapore
    Number of users : Around 1,200
    Time taken : About six months
    Cost of implementation : About $10 million


    Rakesh Biyani
    The implementation
    The implementation was outsourced to a third party. The
    implementation was done by the SAP team with help of Novasoft which is
    based out of Singapore, says Biyani. Some people from Pantaloon also
    assisted in the project. About 24 qualified people worked on this SAP
    implementation. SAP was chosen as the outsourcingparty on a turnkey
    basis. This project was headed by Pantaloons Chief Information
    Technology Officer, Chinar Deshpande.
    Three Phases
    SAP implementation is not a single phase process. The project was divided into three
    phases.
    The first phase involved blueprinting existing processes and mapping them to the desired
    state. In this phase, the entire project team worked on current processes within the
    structure of the organisation, analysed and drafted them. This blueprint was later used
    in the formation of new states of the solution. Since the SAP would combine all the
    processes, each and every one of these had to be evaluated.
    In the second phase, the SAP platform was developed with the help of Novasofts
    template which was predefined by SAP after evaluation of Pantaloons needs and
    expertise in retail solutions.
    The last phase in this project was for stores to switch over to the new system and for
    current data to be ported. Before the SAP implementation, all the data was unorganised.
    This data had to be migrated to the new SAP application.
    The project was flagged off on 15th June 2005 and took about six months to finish. It
    went live at the head office on 1st January 2006. The stores went live on SAP from 1st
    January 2006 to 30th June 2006.
    About the Company
    Pantaloon Retail is the flagship enterprise of the Future Group, with a
    presence across multiple lines of business. The company owns and
    manages multiple retail formats that cater to a wide cross-section of
    Indian society. Headquartered in Mumbai (Bombay), the company
    operates through four million square feet of retail space, has over 140
    stores across 32 cities in India and employs over 14,000 people. The
    company registered a turnover of Rs 2,019 crore for FY 2005-06.
    Pantaloon Retail forayed into retail in 1997 with the launching of
    itsfashion retail chain, Pantaloons in Kolkata. In 2001, it launched Big
    Bazaar, a hypermarket chain. This was followed by Food Bazaar, a food
    and grocery chain. Next up was Central, a first of its kind located in the
    heart of major Indian cities. Some of its other formats include,
    Collection i (home improvement products), E-Zone (consumer
    electronics), Depot (books, music, gifts and stationary), aLL (a Little
    Larger, fashion apparel for plus-size individuals), Shoe Factory
    (footwear) and Blue Sky (fashion accessories). It has recently launched
    its e-business venture, futurebazaar.com. The group's subsidiary
    companies include, Home Solutions Retail India Ltd, Pantaloon
    Industries Ltd, Galaxy Entertainment and Indus League Clothing. The
    group also has joint venture companies with a number of partners
    including French retailer Etam group, Lee Cooper, Manipal Healthcare,

    Chinar
    Deshpande
    Talwalkar's, Gini & Jony and Liberty Shoes. Planet Retail, a group
    company owns the franchisee of international brands like Marks &
    Spencer, Debenhams, Next and Guess in India.
    Benefits and Challenges
    The key challenges in this project were not in the implementation. Rather, the difficulties
    were faced during the data migration and in managing the interim period when the
    project was underway for about six months. Migrating unorganised data to an organised
    format is a challenging task.
    Pantaloon has not been able to see immediate benefits from this implementation. This
    application certainly has long term benefits which will be seen when the performance of
    various aspects will be analysed. It is too early to calculate RoI. We have already
    started working on MAP (Merchandise Assortment Planning), Auto-Replenishment and
    Purchase Orders. We hope to use these systems to optimise our inventory and cut it by
    about two to four weeks (depending on the line of business), says Biyani.
    Maintenance & Hardware
    This application is currently being used by around 1,200 employees across the
    organisation. For maintaining this implementation and its related
    applications
    , Pantaloon has an in-house team and it has outsourced ABAP resources. They are also in the
    process of setting up a SAP Competency Centre. The system runs on a HP Superdome server
    on HP UNIX 11i and the database is from Oracle. The cost of this project was about $10
    million.
    Future projects
    After the successful implementation of SAP for its retail chain, Pantaloon plans to go
    ahead with IT projects such as implementation of WMS with RFID, Customer Intelligence
    and CRM. Inventory and Promotions Optimisation will be pursued later this year.

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