Public Systems Management

Fourth Semester [on-line] Examination

October 2020
MBA-PS (Transportation & Logistics Management)

Paper- 404: Corporate and Strategic Planning in Transport

Management
Time – 2 Hours. Maximum Marks – 80.

Instructions:

1. Answer any 4 Questions

2. Please restrict your answer to a question (including all its parts) to a maximum of
two pages (one sheet of paper). Any part of answer beyond this page limit will not
be considered for evaluation.

1. (a) You have been appointed as a consultant for strategy for two companies: Radian
Logistics Limited and Arc Logistics Limited. The revenue of the two companies as
under. What is the Compounded Annual Growth Rate of revenue of the two companies?
Please show the calculations to justify your answer.

Rs. Crores

FY: 2015- FY: 2016- FY: 2017- FY: 2018-

Company 16 17 18 19

Radian Limited 137.71 153.62 170.95 190.10

Arc Limited 113.69 122.98 131.79 140.77

(b) The strategic objective of Domino’s Pizza is stated as “To safely deliver a hot, quality
pizza in 30 minutes or less at a fair price and reasonable profit.” Given this strategic
objectives, what, according to you, are the imperative actions by the logistics functions of
Domino’s to realize this objective.

(10+10)

2. (a) You are Chief Logistics Officer of Baseline Metals Limited. One of your study shows
that Baseline has a fixed cost ofRs. 10 Million and an averagevariable cost = Rs.
500/MT. The current production of Baseline is 10500 MT, with Raw Material
 consumption being worth Rs. 2.8 Million, inclusive of inbound freight expense. The price
of Raw Material is Rs. 400/MT and inbound freight is estimated to be 2.5% of the
expenses towards rawmaterialconsumption, included in the price of raw
material.Baseline is planning to increase its production by 27%. What is the anticipated
change in the average fixed cost in percentage terms?By how much will average
variable cost change? What is the new inbound freight you must budget for?

(b) Explain the terms: corporate strategy, business strategy, functional strategy and
operating strategy. Substantiate your answers with suitable examples.
(10+10)

3. (a) The Profit & Loss statement of two firms: Newton Limited and Einstein Limited, for
the FY 2019-20 shows the following figures (Rs. Crores). Which Firm has been more
efficient in terms of managing expenses related to logistics and warehousing? Show
calculations in defence of your answer.

Particulars Newton Limited Einstein Limited

Sales 179.26 251.62

Logistics & Warehousing Expenses 30.34 40.62

All other Expenses 80.65 146.24

(b) What are the constituents of macro and micro environment of a firm? Provide
examples of each to substantiate your answer.

(10+10)

4. (a) FastTrack Logistics has estimated the demand curve for its warehousing services
as: 𝑄 = 10 − 2𝑃, 𝑤ℎ𝑒𝑟𝑒𝑄 = 𝑊𝑎𝑟𝑒ℎ𝑜𝑢𝑠𝑖𝑛𝑔𝑆𝑝𝑎𝑐𝑒(𝑖𝑛𝑆𝑞. 𝑀𝑒𝑡𝑟𝑒)𝑎𝑛𝑑𝑃 = 𝑃𝑟𝑖𝑐𝑒𝑝𝑒𝑟𝑆𝑞. 𝑀𝑒𝑡𝑟𝑒.
The current price that FastTrack Logistics charges is Rs. 1310 per sq. metre. As a
matter of strategy, it wants to increase the price to Rs. 1400 per sq. metre. What will be
the expected impact on the demand for warehousing space? Show calculations in
defence of your answer.

(b) How can a seamless and well-performing supply chain be a source of competitive
advantage to a firm? Provide examples to substantiate your answer.

(10+10)
5. As an analyst for logistics strategy of companies you are studying the results of Axiom
Polymers Limited. The study of last 4 quarters reveal the following results:

Particulars UOM Q1 Q2 Q3 Q4

Raw Material Cycle Days 30 35 40 50

WIP Cycle Days 7 8 7 8

Finished Goods Cycle Days 35 53 75 95

Debtors’ Cycle Days 40 60 92 120

Creditors Cycle Days 30 45 70 90

What is the exact problem with Axiom? Which are the areas of functions of Axiom that
need attention immediately? What suggestions do you have for Axiom’s logistics
systems? Defend your answers with reasons.

(20)

6. You are the Chief Logistics Officer of Daffodil Pharmaceuticals Limited. It is 30th
September, 2020. Daffodil has recently obtained an approval from the Ministry of Health
and Family Welfare for manufacturing curative medicine for COVID-19. The commercial
production will start soon – in 2 months (i.e. 1st December, 2020), and the company is
planning sourcing strategy for the 6 months after the start of production. The production
department wants the material 10 days before start of the commercial production. You
have been requested to formulate the sourcing strategy. The following data are
available to you.

Particulars Details

Quantity of Final Generic Product to be Produced 2500 MT

Quantity of Chemical “X” required as Raw Material 75% of the total Output

Quantity of Chemical “X” in stock as on date 150 MT

Wastage of Chemical “X” during manufacturing 5% of the input material required

process
Lead Time for Chemical “X”, from ordering to 40 Days
arrival
Expected date of Completion of temperature- 15th October, 2020 + an anticipated
control storage for Chemical “X”
 delay of 10 days

Shelf life of Chemical “X” 400 Days

Based on the above data, on which date do you planto place your first order for
Chemical “X”? Assuming that you will order the entire requirement for Chemical X in 4
equal instalments, what is the lot size of the first order?

(b) Define “industry attractiveness”. Do you think that attractiveness of an industry

promotes fragmentation of the industry? Defend your answer with suitable example(s).

(10+10)