Reference no: EM133063657

Chapter 1

Field Study: Estimating the Length of a Supply Chain for an FMCG Company. The objective of the study is to estimate the length of the supply chain for packed goods. This field study will help you in understanding supply chain opportunities in distribution in India.

Methodology
• Pick up two competing companies from the FMCG sector. Identify the different product lines offered by these companies.
• Select four retailers (two from organized sector and two from the unorganized sector) for the study.
• From each retail store, collect the following data for each of the selected product lines:
• » Packing/manufacturing date on stock held at retailer (as per the law, all packaged goods
companies are expected to print manufacturing date/month data on each package)
• » Estimate of average sales rate (How many units are sold per month?)
• » Stock available with the retailer
• Estimate length of chain
Let us suppose that three products X, Y and Z have been chosen for the study and the study was carried out at the end of December 2014. Data (stocks, sales rate, manufacturing date on stocks on the shelf) and estimation of the length of the chain for the three product lines is as shown in the table above.
• The same analysis can be carried out for multiple retailers for the same company. Use the above methodology to carry out the following analysis:
• » Compare the time taken by a large firm (say Colgate) and small firm (say Anchor).
• » Compare and contrast the time taken in chain for a fast-moving product (Colgate toothpaste) vis-à-vis a slow-moving product (Colgate-Palmolive shaving cream).
• » Compare the time taken by a chain for the organized retailer (Subhiksha, Foodworld) vis-àvis a neighbourhood kirana (the unorganized retailer, also known as mom-and-pop stores) store.

Chapter 2
Supply Chain Benchmarking Study The objective of the study is to carry out a supply chain benchmarking study for a selected industry.
Methodology
Identify at least three listed (public limited) firms from the industry selected for the benchmarking study. For example, for the paints industry you could select the following top four firms: Asian Paints (India) Ltd., Goodlass Nerolac Paints Ltd., Berger Paints and Jenson & Nicholson Ltd. Collect the relevant financial data (see Table 2.1 for details) for last three financial years for the companies in the set. The electronic database Prowess managed by CMIE can be used to collect the relevant data. Alternatively, visit the company Web site and download the annual reports of the respective companies.
Calculate following three performance measures for last three financial years for all the companies in the set:
• Total length of the chain (days of raw material inventory + days of work in process inventory + days of finished goods inventory)
• Supply chain inefficiency ratio
• Supply chain working capital productivity
Compare the performance across companies over the last three years.
A longitudinal analysis allows you to see how individual firms have improved on these supply chain performance measures over the years.

Chapter 3
Analysis: Outsourcing Trends in the Indian Industry The objective of the study is to understand the trends in outsourcing in Indian industries.

The study consists of two parts:
• Analysing the outsourcing trends from financial data of companies
• Carrying out a field study to understand the outsourcing practices in Indian industries
Analysing the outsourcing trends from the financial data of companies

Methodology
Identify an industry (e.g., the automobile industry) and select at least three listed (public limited) firms (Tata Motors, Mahindra & Mahindra Ltd, Maruti Udyog Ltd, Hindustan Motors, etc.) from the selected industry. Collect data on the following two parameters for the last 10 financial years for all the companies in the study:
• Raw material consumed: RM
• Cost of sales: CS
• Outsourcing ratio = RM/CS
The electronic database Prowess maintained by CMIE can be used to collect the relevant data. Alternatively, visit the Websites of the companies for downloading the annual reports of the respective companies. Observe the trend in outsourcing ratio for different firms in the same industry. One expects that, with the present trend in outsourcing, the outsourcing ratio should increase over a period of time.
Field study to understand the outsourcing practices in the Indian industry

Methodology
Identify a company in your neighbourhood and interview a senior manager about the outsourcing practices for the company. Identify activities that are outsourced and find out the activities that are likely to be outsourced in the future. Using the framework provided in this chapter, identify core and non-core activities for the firm and see whether practices followed by the firm matches with the insights derived from the chapter.

Chapter 8
The objective of the study is to understand the impact of ERP implementation on supply chain performance. The study consists of two parts:

1) Understanding the impact of ERP implementation using financial data
2) Understanding the impact of ERP implementation through a field study

(a) Identify a firm that has implemented ERP. Find out the year ERP was implemented. Most of the firms will announce a time when they implemented ERP (refer company Website). Using financial data, compare and contrast pre-ERP and post-ERP performance on the following dimensions:
Business performance: profitability ratio, ROI
Supply chain performance measures (see Chapter 2)

(b) Field study on ERP/supply chain management software implementation: Identify a company in your neighbourhood that has implemented ERP/supply chain management software and interview a senior IT and supply chain manager on the implementation used by the company. Compare the same with the framework proposed in this chapter.

Chapter 9
The main objective of the project is to understand concepts of the bullwhip effect in particular and supply chain integration in general through experiential learning by playing the supply chain game. This project is designed around the famous beer game developed by MIT in the 1960s. Analysis of game will also allow you to understand the impact of information sharing and supply chain structure on the supply chain performance.

Description of the Beer Game
This simplified beer supply chain consists of four entities: a retailer, a wholesaler (supplies to retailer), a distributor (supplies to wholesaler) and a factory (brews beer and supplies to distributor). The retailer faces uncertain customer demand and the factory has unlimited supply of raw material. Each entity in the chain has unlimited storage/production and fixed supply lead time and order delay time in the customer-supplier linkage in the chain. The game is played for 30 weeks. Each week, every entity in the chain has to meet the order placed by its immediate downstream customer. Each entity carries some amount of inventory so that the customer order is filled from the inventory. Any unfulfilled order is recorded as backorder and an attempt is made to fulfil the order as soon as possible. Each entity is expected to minimize two supply chain related costs: inventory carrying cost and backordering cost.

Playing the Game
This game is played by a team consisting of four participants (or pairs of participants), each taking the role of one entity. At the start of the game, participants are divided into teams. Multiple teams can play the game independently. Each entity needs an individual terminal with Internet connection for playing this game. At the end of game, each entity will get the data of costs and charts plotting inventory, backorder and order pattern over time.

Analysis of the Game
Each team is likely to see dramatic fluctuations in order and inventory levels. Each team can try and discuss possible reasons for the dramatic fluctuations observed in the game. A team can also try and relate various concepts discussed in section "External Integration". Apart from observing trends in order and inventory levels, each team should calculate demand amplification and variance amplification for all the entities in the chain.

Demand amplificationi = Peak demandi / Average customer demand
Varince amplificationi = Variance of order placedi / Variance of customer demand
where i is the index for various entities in the chain.

Each team can identify ways in which these fluctuations can be dampened. Teams can specifically examine ways of redesigning the decision processes, physical structure and information channel within the beer supply chain for improving supply chain performance. The team can also discuss and debate on the impact of the scenarios described below on supply chain perfomance.
• Reducing the number of entities in chain. What happens if a factory supplies directly to the retailer?
• Reducing order delay. What happens if a supplier can place an order on the Web so that there is no ordering delay in the system?
• Reducing shipment time. What happens if a supplier uses a faster mode of transport?
• Sharing POS data with brewery. What happens if a retailer shares POS data with the factory on a real-time basis?
• Sharing demand/inventory information across chain. What happens if every player has access to all the information in the chain?
• Transfer of decision rights to one part in the chain. What happens if all the decisions in the chain are made by one party? (This idea is similar to the VMI where all the relevant decisions are transferred to the vendor.)
Estimate the likely value of demand amplification and variance amplification for each of the above scenarios.

Chapter 10

How will your analysis of the problem discussed in section "Restructure Placement of Inventory in Chain" change if we bring product variety in the analysis: Let us say the company offered three variants and weekly demand for each of the variants in each of the market follows normal distribution with a mean equal to 100 with a standard deviation of 50. The manufacturing company had two sub-stages: manufacturing component and assembly. The manufacturing component accounted for 80 per cent of value addition and lead time.
1. Where should company hold stocks in the system?
2. Determine the optimal level of safety stocks, given the above decision.
3. How will the decision change if:
a) The number of markets increase (assume that in each market demand distribution is the same, i.e., mean = 300, standard deviation =100)
b) What is the impact of a different value-addition curve:
i. RM intensive: distribution: 60:20:20
ii. Manufacturing intensive: 20:60:20
iii. Distribution intensive: 20:20:60
c) What is the impact of differential lead time
i. RM intensive: (3, 1, 1)
ii. Manufacturing intensive (1, 3, 1)
iii. Distribution intensive (1, 1, 3)

TextBook - Supply Chain Management: Text and Cases by Janat Shah

Attachment:- Supply Chain Management.rar