Ignou Mba Project CHAIN MANAGEMENT
Ignou Mba Project CHAIN MANAGEMENT
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Indira Gandhi National Open University Project Report Sample On MBA OPERATION At
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PROJECT REPORT
ON
SUBMITTED BY
NAME: ……………………
UNDER GUIDANCE OF
……………………………..
In
Operation Management
Maidan Garhi
CERTIFICATE OF ORIGINALITY
This is to certify that the project titled “ROLE OF SUPPLY CHAIN MANAGEMENT &
INTEGRATION FOR NEXT GENERATION CONSTRUCTION INDUSTRY AT ESSAR,
GUJARAT” is an original work of the Student and is being submitted SUMEET KUMAR
MAISURIA in partial fulfillment for the award of the “MASTER OF BUSINESS ADMINISTRATION
(OPERATION MANAGEMENT)” degree of INDIRA GANDHI NATIONAL OPEN
UNIVERSITY. This report has not been submitted earlier either to this University or to any other
University/Institution for the fulfillment of the requirement of a course of study.
ACKNOWLEDGEMENT
With Candor and Pleasure I take opportunity to express my sincere thanks and obligation to my esteemed
guide ………………………. It is because of his able and mature guidance and co operation without which
it would not have been possible for me to complete my project.
It is my pleasant duty to thank all the staff member of the computer center who never hesitated me from
time during the project.
Finally, I gratefully acknowledge the support, encouragement & patience of my family, and as always,
nothing in my life would be possible without God, Thank You!
NAME:……………………..
DECLARATION
I hereby declare that this project work titled “ROLE OF SUPPLY CHAIN MANAGEMENT &
INTEGRATION FOR NEXT GENERATION CONSTRUCTION INDUSTRY AT ESSAR,
GUJARAT” is my original work and no part of it has been submitted for any other degree purpose or
published in any other from till date.
NAME:………………………
CHAPTER CONTENTS
Certificate of Originality
Acknowledgement
Declaration
Title of the project
1 Introduction
Company Overview
2 Review of Literature
3 Objectives of the study
4 Research Methodology
5 Data Analysis & Interpretation
6 Findings and Recommendation
7 Conclusion and Limitation
References
Questionnaire
CHAPTER – 1
Supply chain management is extremely current due to its success in other industries and therefore
considered to be the future in construction industry. Supply chain management has been in use before the
recent hype in the construction industry. Supply chain management (SCM) is a concept that has flourished
in manufacturing, originating from Just-In-Time (JIT) production and logistics. Today, SCM represents an
autonomous managerial concept, although still largely dominated by logistics. SCM endeavors to observe
the entire scope of the supply chain. All issues are viewed and resolved in a supply chain perspective,
taking into account the interdependency in the supply chain. SCM offers a methodology to relieve the
myopic control in the supply chain that has been reinforcing waste and problems.
Why Supply Chain Management in Construction?
Strategy supply chain can be considered as comprising the following key components.
1. Sourcing strategy
2. Distribution strategy
3. Inventory strategy
5. Integration strategy
Sourcing Strategy–
Not many organizations go for in-house manufacturing .They rely on sourcing and developing vendors
with elaborate systems to check and control quality. Even firms which decide on in- house manufacturing
often do not go for manufacturing full range of products to meet total market demand but decide on partial
sourcing. Make-and-buy decisions make a significant impact on the cost structure of a company’s
products.
Manufacturing Management –
This functional area decides such issues as to how production should be organized and managed.
Traditionally the production planning and control systems have been designed to maximize efficiency of
labor and utilization of machines. These considerations are no longer adequate. In a customer focused
business world, production processes have to optimize balance between satisfaction and efficiency.
More-or-Buy Decisions-
Traditional approaches on make-or-buy decision have considered such factors as cost of in-house
manufacturing. Cost of sourced supplies. Labor cost changes (for reasons of buy decision, sometimes in-
house labour become idle), recovery of overheads, underutilized capacity in plant and machinery, transport
interruptions, etc. It now also calls for considerations of faster deliveries, easy access for service, repairs
and replacements, and customer preferences.
Capacity Management-
This calls for decision to locate plants for in-house processing and suppliers and to fix capacities for both
plants and suppliers. Traditionally, the decision on location of plants were taken based on consideration
such as cost of land, government subsidies. Cost of power, availability of labour and other manpower,
government concessions on sales tax and other statutory levies, industrial relations, etc. Many of these
considerations are equally valid today. But more important considerations have emerged. Proximity to
customers, costs of distribution, supply channel infrastructure availability, access to service facilities, and
access to various modes of transport network, access to IT are the new emerging considerations.
Distribution Strategy-
Evans and Danks (2008) define it as the ‘linkage between the firm’s customers and the sources of its
products or services that the firm provides to the marks place. Strategy decision is not only important as it
involves consideration of distribution cost which form a significant percentage of total marketing costs.
But it also calls for a long-term commitment to certain type of costs associated with a channel of
distribution. The distribution strategy has three elements.
Distribution Strategy
Supply Chain Configuration
Channel Selection
Distribution Planning
Figure -4 Factors of Distribution Strategy
Channel Selection –
A wide choice of Channels is available. These include dealers, manufacturers, stockiest, wholesalers,
distribution, and currently, World Wide Web, etc. Choice of an appropriate channel depends on the
products or services to be marketed, the volume involved the geographical locations to be covered and the
long term business policy of the firm in carrying out marketing functions and exercising controls. Choice
of a channel is important as it can directly influence the level of customer service.
A supply chain has a number of participants. Sources of supplies, storage or stocking stations, and
distribution channels till he supplies reach to end-customer constitute some of the major participants.
Decision on alternatives such as number of participants and their locations have an important bearing on
the efficacy of the organization. Supply chain configuration all for determining numbers and location of
each of the participants.
It calls for specifying the role of each of the participants. The answers to these questions will take into
customers and their geographic locations, cost of transportation, distribution so that supplies reach the
destinations on time.
Distribution Planning-
The supplies can be carried through a wide variety of transportation choices. A faster transportation not
only helps to achieve a higher level of customer satisfaction in making the supplies available on time but
also helps to increase the sales by seizing business opportunities, when there is a sudden rise in demand. To
meet these objectives many corporations tend own their own fleet of transport and major factor in a supply
chain system. This factor, therefore, seeks to establish the transport mode capacity, location, routing and
the schedules of distribution so the supplies reach the destinations on time.
Inventory Strategy-
This constitutes the core of SCM. The major costs of a supply chain, the level of customer satisfaction, the
business growth (or fall) are largely influenced by the inventory strategy. There are several issues which
are at conflict with each other and are required to be resolved. Higher inventory at several distribution
points may, for example, helps in making the goods easily available to customers and result in growth of
sales but this will simultaneously increase costs and bring down revenues .Inventory strategy can be
considered as comprising three elements.
Demand Forecasting-
This calls for determination of the demand of the products for the period considered. Many products in the
market have s seasonal demand which is governed by factors such as festivals, weather (seasons), etc.
Many other follow regular cycle. There are products which find market. When there is scarcity of
alternatives. Demand planning is needed as it enables the company to organize its sourcing and stocking
policies. The economics of a total system can go haywire if demand planning finally finds no resemblance
to the actual market conditions. On the other hand an accurate demand forecast will result in totally smooth
operations. A number of forecasting tools are available to carry out demand planning in a systematic
manner.
Inventory Planning-
Once the demand has been forecast, the organization is called upon to determine levels of production to
develop an inventory policy. The latter includes fixing of levels of inventory such as minimum stock,
maximum levels of stocks reorder levels, lead time for procurement order level quantities, etc. Inventory
planning also includes setting up of procedures and fixing time schedules for monitoring the inventories
and exercising controls. Inventory planning is required to be carried at all the channels (stock points) of the
supply chain system. In a supply chain system costs of inventory constitute a major overhead. Customer
satisfaction on the other hand exacts delivery of goods from ready stock.
Adequate stocking facilities are needed for keeping stocks at each of the channel stock stations. The
storing facilities should be sufficient to carry the inventory in safe conditions and should be equipped with
handling facilities for easy and quick receipts and issues. Besides, the storage facilities should be situated
close to the rail/road heads so as to minimize the costs of transportation. Proximity to distribution channels
is also desirable as it will reduce the time to carry stock to the sale counters.
ERP
Orders, Items, Routing….
Scheduler
Completions, Materials, Used, Lots, Hours…
Manufacturing Orders, Dispatch Lists….
Execution
Legacy System
ERP
Materials plan, Production Plan
Inventory, Bills, Forecast. Customer Order
Planner
Latest Build Schedule
Constrained Plan
Scheduler
State of Execution on the Shop Floor
Detailed Resource Dispatch List
Execution
Definition
There seems to be a universal agreement on what a supply chain is. Jaya shankar et al. defines a supply
chain to be a network of autonomous or semi-autonomous business entities collectively responsible for
procurement, manufacturing, and distribution activities associated with one or more families of related
products.
A supply chain is a network of facilities that procure raw materials, transform them into
intermediate goods and then final products, and deliver the products to customers through a
distribution system.
A supply chain is a network of facilities and distribution options that performs the functions of
procurement of materials, transformation of these materials into intermediate and finished products,
and the distribution of these finished products to customers.
Figure shows an example of a supply chain. Materials flow downstream, from raw material sources
through a manufacturing level transforming the raw materials to intermediate products (also referred to as
components or parts). These are assembled on the next level to form products. The products are shipped to
distribution centers and from there on to manufacturers and customers.
The two middle boxes in the lower row of Figure delivery reliability, and delivery times, are both aspects
of customer service, which is highly dependent on the first box, flexibility, and on the last box, inventory.
Decisions made on the strategic level are of course interrelated. For example decisions on mode of
transport are influenced by decisions on geographical placement of plants and warehouses, and inventory
policies are influenced by choice of suppliers and production locations. Modeling and simulation is
frequently used for analyzing these interrelations, and the impact of making strategic level changes in the
supply chain.
On the tactical level medium term decisions are made, such as weekly demand forecasts, distribution and
transportation plan, production planning, and materials requirement planning. The operational level of
supply chain management is concerned with the very short term decisions made from day to day. The
border between the tactical and operational levels is vague. Often no distinction is made, as will be the case
in this thesis.
If your system is not performing up to this potential, be sure you have implemented each of the following
characteristics of good inventory management:
1. Protect your company against theft – Make sure that the only people
in your warehouse belong in your warehouse. Pilferage is a larger
problem than most distributors realize.
3. Assign and use bin locations – Assign primary and surplus bin
locations for every stocked item. All picking and receiving documents
should list the primary bin location (in either characters or a bar code).
With correct bin locations on documents, order picking is probably the
least complicated job in your warehouse. Assign inexperienced people
to this task and your most experienced warehouse workers to receiving
inventory and stock management.
8. Ensure that stock balances are accurate and will remain accurate –
Implement a comprehensive cycle counting program. A good cycle
counting program can replace your traditional year-end physical
inventory.
1. Minimum/Maximum quantities
5. Preseason buys
ABOUT LOGISTICS:
Logistics is the art and science of managing and controlling the flow of goods, energy, information and
other resources like products, services, and people, from the source of production to the marketplace. It is
difficult to accomplish any marketing or manufacturing without logistical support. It involves the
integration of information, transportation, inventory, warehousing, material handling, and packaging. The
operating responsibility of logistics is the geographical repositioning of raw materials, work in process,
and finished inventories where required at the lowest cost possible.
1. Facility structure,
2. Transportation,
3. Inventory,
Facility Structure-
Strengths Weakness Opportunities Threats
Inadequate facilities
Vast geographical area for
Need to develop a total
design of distribution Clustering of facilitie
system network
network
Facilities location
Land cost generally not Optimal location of
decisions are not Congestion pollution
high facilities
professionally taken
Inventory Control-
WAREHOUSING
Warehouse is the location to or from which the inventory is transported. Warehouses are the key driver of
supply chain performance in terms of responsiveness and efficiency. Before deciding the location of
Warehouses we must consider the following points:
INVENTORY MANAGEMENT
OPERATIONS MANAGEMENT:
COMPANY PROFILE:
CHAPTER – 2
REVIEW OF LITERATURE
CHAPTER – 3
CHAPTER – 4
RESEARCH METHODOLOGY
RESEARCH DESIGN:
The first step in developing any sample design is to clearly define the set of objects, as my study is
exploratory, the sampling design includes three decisions i.e. sampling unit, Sample size & Sampling
procedure.
The data was collected using both by primary data collection methods as well as secondary sources.
The base on which a study rests is the information that is embedded in it. The data for this study was
obtained as a blend of both Secondary and Primary sources.
PRIMARY DATA: Most of the information was gathered through primary source. The methods that were
collected primary data are:
Structured Interview
Internet sites
Universe:
CONVENIENT SAMPLING: it is that type of sampling where the researcher selects the sample
according to his or her convenience.
TOOL OF ANALYSIS:
Data collection was done through questionnaire. The Ms-word & Ms-Excel software was used to analyze
the data. Different types of graphs & Charts were used to interpretation the findings diagrammatically.
They are:
Pie Charts
Bar Graphs
CHAPTER – 5
Q1. How successful do you think is your company in managing its supply chain in general?
As shown by the pie chart, 40% of respondent Successful think is your company in managing its supply
chain in general, 28% of respondent somewhat successful, 18% of respondent Very successful, 8% not
successful and 6% of not successful at all.
Q3. Does your company have a clear SCM and operation strategic plan?
As shown by the graph, 94% of respondent think company has a clear SCM and operation strategic plan,
6% of respondent not think like that.
Q4. How satisfied are you with the current inventory policy regarding SCM?
As shown by the pie chart, 56% of respondent satisfied with the current inventory policy regarding SCM,
24% of respondent quite satisfied, 12% of respondent Very satisfied, 12% Somewhat and 6% of respondent
Not at all.
Q5. Is supply chain management having all the address of the developer branches of the company?
As shown by the graph, 78% of respondent think supply chain management having all the address of the
developer branches of the company, 22% of respondent not agrees with it.
Q6. Rate the working strategies of supply chain management department on the basis of the current
programs?
As shown by the pie chart, 48% of respondent feel good working strategies of supply chain management
department on the basis of the current programs, 30% of respondent Average, 12% of respondent
Outstanding, 10% Excellent.
Q7. Is the supply chain management department is having sufficient transportation and capacity?
As shown by the graph, 92% of respondent think supply chain management department is having sufficient
transportation and capacity, and 8% of respondent think not sufficient.
Q8. Choose the right option, where the supply chain department is facing problem in taking care of
the raw material?
As shown by the pie chart, 34% of respondent feel during storage, 30% of respondent Packaging, 14% of
respondent Testing of packaging, 22% Evaluation of defective raw material.
Q9. How do you rate the delivery activity and Inventory management of the department?
As shown by the pie chart, 40% of respondent feel Good delivery activity and Inventory management of
the department, 28% of respondent Very effective, 20% of respondent Average, 12% Excellent.
Q10. Is there any case recorded by the supply chain department in which the production department
complained late delivery of raw materials?
As shown by the graph, 84% of respondent think No, and 16% of respondent think yes.
Q11. Choose the right option, where the supply chain department is facing problem in taking care of
the raw material in Essar?
As shown by the pie chart, 34% of respondent choose Testing of packaging, 26% of respondent said during
storage, 22% of respondent choose Packaging, and 18% of respondent choose Evaluation of defective raw
material.
Q12. Is there any case recorded by the supply chain department of Essar in which the production
department complained late delivery of raw materials?
As shown by the graph, 78% of respondent said No, and 22% of respondent said yes.
Q13. According to the current growth process of the Essar, which of the following needs much
attention and progress to boost the production?
As shown by the pie chart, 36% of respondent feel Tactical activities the current growth process of the
Essar, which is needs much attention and progress to boost the production, 34% of respondent said Current
programming strategies, 30% of respondent feel Operational activities.
As shown by the graph, 86% of respondent feel happy with the SCM of Essar and 14% of respondent not
happy with the SCM of Essar.
CHAPTER – 6
The findings of the study of “ROLE OF SUPPLY CHAIN MANAGEMENT & INTEGRATION FOR
NEXT GENERATION CONSTRUCTION INDUSTRY AT ESSAR, GUJARAT”.
40% of respondent Successful think is your company in managing its
supply chain in general, 28% of respondent somewhat successful, 18% of
respondent Very successful, 8% not successful and 6% of not successful at
all.
86% of respondent feel happy with the SCM of Essar and 14% of
respondent not happy with the SCM of Essar.
CHAPTER –7
CONCLUSION
It is very much possible that some of the respondents may give the
incorrect information.
REFERENCES
4. COX, A., 1999. Power, Value and Supply Chain Management. Supply
Chain Management: An International journey, 4(4), pp.167-175.
7. KELLY, J., MORLEDGE, R., and WILKINSON, S., 2002. Best Value in
Construction. 1st ed. Oxford: Blackwell Publishing.
10. www.essar.com.
QUESTIONNAIRE
DEAR RESPONDENTS
Name : ……………………………….
Age : ……………………………….
Address : ……………………………….
Gender : ……………………………….
Designation : ……………………………….
Q1. How successful do you think is your company in managing its supply chain in general?
Not successful
Somewhat successful
Successful
Very successful
Q2. Does your company have a separate logistics or Inventory department?
Yes
NO
Q3. Does your company have a clear SCM and operation strategic plan?
Yes
NO
Q4. How satisfied are you with the current inventory policy regarding SCM?
Not at all
Somewhat
Satisfied
Quite satisfied
Very satisfied
Q5. Is supply chain management having all the address of the developer branches of the company?
Yes
NO
Q6. Rate the working strategies of supply chain management department on the basis of the current
programs?
Outstanding
Excellent
Good
Average
Q7. Is the supply chain management department is having sufficient transportation and capacity?
Yes
Not sufficient
Q8. Choose the right option, where the supply chain department is facing problem in taking care of
the raw material?
During storage
Packaging
Testing of packaging
Excellent
Very effective
Good
Average
Q10. Is there any case recorded by the supply chain department in which the production department
complained late delivery of raw materials?
Yes
No
Q11. Choose the right option, where the supply chain department is facing problem in taking care of
the raw material in Essar?
During storage
Packaging
Testing of packaging
Yes
NO
Q13. According to the current growth process of the Essar, which of the following needs much
attention and progress to boost the production?
Operational activities
Tactical activities
Yes
No