Professional Documents
Culture Documents
Dear Readers,
At the outset let me wish all the members a very happy prosperous and eventful new
year. By the time you receive this edition of MATERIALS MANAGMENT REVIEW in your
hand, Deepavali celebrations would be over and you would have already enjoyed the
biggest festival in our country i.e. Festival of lights. I am sure, you all must be looking
forward for the new year with new idea, thoughts and innovation.
The National Seminar on Public Procurement on 13th September, 2014 at Hyderabad followed by National Seminar
on Greening the Supply Chain on 21st September, 2014 at Rai Bareli where the great events. The 2nd MAT
SELECT organized by IIMM, Aurangabad branch on 29th September, 2014 was simply memorable one.
I got an opportunity to attend all the three events held last month in three dynamic branches. I was highly
impressed by the initiative and efforts taken by the branch chairmen and their entire team at each branch. At all
these places I could see large number of delegates from various organisations/industries/corporate sectors. The
Chairmen of all the branches promised to fulfill their target for membership growth as well as enhancement in
students enrollment without fail. Each branch could demonstrate their strength and I expect lot of positive
results in terms of their participation and subsequent expansion of activities in their branches. I would request
all other branches in the country to take the lead in arranging similar events which is essential for the growth and
development of our institute. In my earlier communication, I emphasized to make vide publicity about our
strength in Supply Chain Profession through our colleagues and friends amongst Corporate Sectors, MNCs,
Industries, Institutes and MSME sector which will not only be beneficial to their own organisation but also to
society and the Nation.
I am happy to inform you that CRIMM centers are extended to four more branches in addition to Kolkatta.
Prospectus have been received by these branches and it is the best opportunity for Materials Professionals to
take advantage of the facilities available at different centers to persue research like Vadodara, Delhi, Chennai,
Nagpur. If other branches volunteer, we can increase the number of centers. All Chairmen have been asked to
take initiative to take advantage of E-learning programme run by Bangalore Branch at present. All technical
supports are available and let us promote this programme in all regions vigorously.
You are all aware that NATCOM 2014 is being organized by our Chandigarh branch on 28th & 29th November,
2014. Chandigarh is a beautiful city which is very well planned and surrounded by Hill stations and forests as well
as many other tourist spots. The weather is pleasant one in November and therefore let us join NATCOM 2014 in
large numbers to make it grand success and make it memorable one. I would request your support and participation
from one and all.
To recognise the contributions of the branches and members I would like to remind you that any branch or an
individual whose performance in terms of increase in membership strength and enrollment of students is highest
will be honoured with special award during NATCOM at Chandigarh.
I look for your active participation in the various activities of the institute. My strong desire is to build a Good
Brand Image of IIMM and towards this I seek your co-operation and participation from one and all.
My best wishes to all our readers.
LALBHAI PATEL
National President - IIMM
Mobile - +919662019638
Email : lppatel09@yahoo.com
Materials Management Review
November 2014
(M.K.BHARDWAJ)
November 2014
MATERIALS MANAGEMENT
REVIEW
Volume 11 - Issue 1
IIMM is a charter member of
International Federation of
Purchasing & Supply Management
CONTENTS
Mr. M. K. Bhardwaj
Past President, IIMM &
Former Director Ministry of Defence
Core Committee :
Mr. Ashok Sharma, President 5M India
Mr. V. K. Jain, Former ED, Air India
Mr. Tej K Magazine, Management Advisor
National President :
Correspondence :
MATERIALS MANAGEMENT REVIEW
Indian Institute of Materials
Management
4598/12 B, Ist Floor, Ansari Road,
Darya Ganj, New Delhi - 110 002.
Phones : 011-43615373
Fax: 91-11-43575373
E-mail: iimmdelhimmr@gmail.com &
iimm2delhi@gmail.com
Website : iimm.org
(November 2014)
PAGE NO.
November 2014
ndustry welcomes
the move, says it
will
boost
manufacturing sector
growth
Prime
Minister
Narendra
Modi
unveiled a slew of
measures aimed to
change labour laws for
the better and to make
inspections
more
transparent
and
devoid of unnecessary
harassment.
The
measures include a
taking
away
of
i n s p e c t o r s
discretionary powers, easy portability for
provident fund users, a worry-free labour law
compliance web portal and a scheme for training
apprentices.
Modi announced these measures at a Deendayal
Upadhyay Shrameva Jayateprogramme here, with
the government also sending around 20 million
SMS text messages apprising organisations,
labourers and youth about these schemes.
Deendayal Upadhyay was a key founding figure
and organiser of the Bharatiya Jana Sangh,
ancestor party to Modis Bharatiya Janata Party,
now the countrys ruling one.
Modi asserted these steps would lead to greater
ease of doing business. For the success of Make
in India (his recently announced programme to
promote manufacturing), ease of doing business
should be given priority, said the PM. Chambers
of business welcomed it, saying these had been
long-pending demands of the sector. We
welcome the Shram Suvidha Portal to facilitate
a single window for compliance with labour laws.
Simplification of procedures has been a longstanding concern for industry(this) will bring in
4
November 2014
a lot of transparency
and accountability,
said
Chandrajit
Banerjee, directorgeneral
at
the
Confederation
of
Indian Industry.
He said with greater
ease
of
doing
business
and
availability of skilled
personnel, growth of
themanufacturing sector
will get a big fillip. The
Union government
also announced that
work was in progress
on reforms in the area
of child labour (in the news following the Nobel
award to Kailash Satyarthi for work in this area)
and the micro, small and medium enterprises
sector. The labour ministry is working on these.
The details will be revealed in the coming days,
minister Narendra Singh Tomar said.
Modi on labour, governance: Modi said whitecollar jobs were seen as dignified but people
often look down upon the working classThe
labour class provides solutions to many problems
surrounding our lives.
Terming the new inspection scheme a part of egovernance, he said it would save industries from
needless harassment. Through technology
intervention in the new inspection system, it will
be easy, effective and economic governance
which will lead to transparency, he said.
He said a computer will decide where the
inspector has to go for inspection and he will have
to file his report within 72 hours, helping both
labour and industry. The area of inspection will
be divided into three parts: mandatory (extreme
situation), optional (system-generated) and
Materials Management Review
compliance-based. The inspector will get an autogenerated list. The government also made
operational the Universal Account Number (UAN)
facility for EPFOsubscribers, for ease and quick
portability of PF funds on switching jobs anywhere
in the country. It was possible, noted Modi, to
easily switch mobile numbers while shifting to a
different state but a poor labour is unable to
mobilise his own PF while switching his job.
He underlined the fact that Rs 27,000 crore was
currently with the Employees Provident Fund
Organisation (EPFO) in inoperative accounts. I
want to return the money to those poor people,
said Modi. He termed the UAN a good initiative to
link industries and banks. Modi said these steps
were directed towards his governments motto
of minimum government and maximum
governance.
He also announced a unified labour portal for ease
of compliance with four central government
organisations EPFO, Employees State Insurance
Corporation, Directorate General of Mines Safety
and chief labour commissioner.
This will facilitate a common window for online
registration of units, reporting of inspections,
filing of annual returns and redressal of
grievances. Modi said a single-sheet compliance
system had been introduced online for 16 labour
laws.
He termed skill development a big opportunity
for the country. By 2020, we need millions of
skilled people. Either he becomes a job creator or
a job opportunity comes knocking on his doors.
He added people do not give due respect to
students of Industrial Training Institutes.
Another scheme, Apprentice Protsahan Yojana,
announced on Thursday, is aimed to increase
apprenticeship coverage to 2.3 million from the
490,000 at present. The labour ministry will
reimburse manufacturing units half the stipend
paid to apprentices during the first two years of
training. The scheme will support 100,000
apprentices up to March 2017.
The Centre also announced convergence of three
schemes for the unorganised sector Rashtriya
Swastha Bima Yojana, Aam Aadmi Bima Yojana and
Indira Gandhi National Old Age Pension Scheme.
Initially, the government will link all these
schemes to a single smart card and will have a
Materials Management Review
November 2014
2.
3.
4.
5.
November 2014
November 2014
November 2014
11
November 2014
13
14
November 2014
15
November 2014
EXPORT
54.35
52.90
168.65
159.45
Canadian Dollar
55.75
54.50
Danish Kroner
10.65
10.30
EURO
79.00
77.10
8.05
7.90
220.65
208.10
Newzealand Dollar
48.75
47.35
Norwegian Kroner
9.75
9.45
101.25
99.00
48.95
47.90
5.60
5.30
16.95
16.00
8.70
8.45
Swiss Franc
65.40
63.85
UAE Dirham
17.30
16.35
US Dollar
62.30
61.30
Japanese Yen
56.90
55.55
Kenya Shilling
71.35
67.25
CURRENCY
Australian Dollar
Bahraini Dinar
Pound Sterling
Singapore Dollar
Swedish Kroner
Source : www.dailyshippingtimes.com/customexchange-rates.php
November 2014
17
November 2014
Pharmaceutical companies have historically high cashto-cash (C2C) values in the range of 200 to 250 days.
Despite large investments in Enterprise Resource
Planning (ERP) and Advanced Planning Systems (ARP),
cash-to-cash values have gone up, not down, over the
past decade. The pharmaceutical industry has long been
a laggard in the use of new techniques and technologies
to manage in-ventories. In the world of high gross
margins and global expansions, it has just not mattered
as much. Although, inventory is only one of the three
com-ponents of C2C; along with Payables and
Receivables, each of the three levers plays a large role
in the overall movement of the C2C value.
Companies in FMCG, metal, mining, automotive,
chemical etc. started operations excellence initiative
in manufacturing areas of the Supply Chain cniite some
time back and achieved phenomenal results to reduce
the conversion cost and all wastages. With continuous
drive on operations excellence, these companies were
successful in bringing down their OEE (Overall
Ecruipment Effectiveness) to 70 to 80 per cent range.
These were achieved through reduction of downtime,
setup time and improvement of performance rate.
Pharma companies had little focus in these areas and
their OEE hovered around 40 to 50 per cent. High
downtime, setup time and low performance rate leads
to many other problems across the supply chain such
as high inventory of raw materials, finished goods, low
utilisation of manpower, late delivery, product
obsolescence. Manpower cost for a typical pharma
company is about 15 per cent of their total cost which
is very high as compared to other manufacturing
industries where it is 8 to 10 per cent. By focusing on
operations efficiency improvement, pharma companies
can become lean and agile to respond to changing
de-mands of market.
FMCG manufacturers build their production plans on
the basis of point of sale information from their retail
customers. So far the healthcare sector has only
managed it in pockets. In order to scale in a costeffective way, these pockets must be con-nected. In fact,
because these efforts are not con-sistent or global, they
may actually raise the cost and complexity of the global
Materials Management Review
94
77
18
40
15
5
13
179
November 2014
19
November 2014
FREIGHTS RATES
(Trucks per 9 Tonnes)
Delhi - Lucknow
19,500
Delhi - Jaipur
12,000
Delhi - Ahmedabad
22,500
Delhi - Indore
26,500
Delhi - Patna
36,000
Delhi - Ranchi
Delhi - Panipat
50,000
8,000
Delhi - Chandigarh
15,000
Delhi - Jalandhar
14,500
Delhi - Ludhiana
15,500
Delhi - Mumbai
42,000
Delhi - Hyderabad
Delhi - Bangalore
59,500
64,000
Delhi - Kolkata
46,500
Delhi - Chennai
81,500
21
BENEFITS OF INTEGRATION OF
ISO 9001, ISO 14001 & OHSAS 18001
MANAGEMENT SYSTEMS
SHAILESH SHRIVASTAVA,
SR. DY. DIRECTOR, NPC
November 2014
23
November 2014
>Z
>
>
/^^
25
November 2014
Cost
Definition/ Explanation
Shipping
Charges
paid
to
the
shipping
Company/ Carrier for moving the
cargo from supplier s warehouse to
the destination port in India
Inland Port
handling Cost
Custom
Clearances and
Documentation
Cost
Inter-shifting to
Rail siding/
Storage Area Cost
Inland
Transportation
Cost
Significance in Steel
Industry
Bulk procurement of the
raw-materials at one point
of time and the shipping
cost involvement is very
high, Which is controlled
by market demand and
supply all the time also.
The charges vary from port
to port keeping in view of
the
infrastructural
availabilities.
Relative Wt.
H
M
L
The-inbound
movements
quantities are quite huge all
the
time,
the
agency
charges paid to the service
providers is at the higher
side which reflects directly
the inbound logistics cost.
These
charges
are
controlled by port tariffs
which is payable on time to
time basis.
Because of poor railway
connectivity,
road
conditions the movements
from the port to plant is not
adequate
as
required
resulting
additional
abnormal
logistics
cost
incurring all the time.
Cost
Definition/ Explanation
Significance in Steel
Industry
In plant Material
Handling Cost.
In plant material
movement as per the
production plan or
Outbound delivery.
Custom Clearances
and Documentation
Cost.
Inter-shifting to Rail
siding/ Storage Area
Cost.
Inland Transportation
Cost.
Relative Wt.
H
M
L
The-inbound
movements
quantities are quite huge all the
time, the agency charges paid to
the service providers is at the
higher side which reflects
directly the inbound logistics
cost.
These charges are controlled by
port tariffs which is payable on
time to time basis.
Because
of
poor
railway
connectivity, road conditions
the movements from the port to
plant is not adequate as required
resulting additional abnormal
logistics cost incurring all the
time.
November 2014
27
Fumigation and
Packing Cost
Lashing and
choking Cost
Placement of
Trailers and a
movement to port
Cost
Custom clearance
and documentation
Cost
Shipping and
deliver at buyers go
down Cost
November 2014
478, 2010.
11.
12.
13.
14.
References
1.
2.
15.
3.
16.
17.
18.
19.
4.
5.
6.
7.
20.
8.
21.
9.
22.
10.
November 2014
29
November 2014
2.
3.
4.
5.
6.
7.
8.
9.
2.
3.
4.
5.
COMMODITY INDEX
Commodities
Dayss Index
Prev. Index
Week Ago
Month Ago
Index
2464.1
2465.0
2471.3
2485.1
Bullion
4433.4
4433.4
4461.7
4565.5
Cement
1811.5
1811.5
1834.5
1734.9
Chemicals
1915.9
1915.9
1915.9
1903.4
Edible Oil
1329.5
1329.5
1341.7
1272.5
Foodgrains
2160.8
2161.8
2151.1
2177.4
Fuel
2468.2
2468.2
2468.2
2474.5
Indl Metals
1791.6
1795.8
1804.4
1812.9
Other Agricom
1953.5
1953.5
1962.4
1993.0
Plastics
2365.7
2365.7
2370.8
2421.8
November 2014
31
November 2014
1.1
Literature Review
33
services firm), India s report, Winning-in-India sretail-sector, Factors for success, 2011, focuses on the
main drivers, trends and issues in India s retail sector
[14]. It also presents an overview of the key tax and
regulatory issues, a discussion on the benefits of modern
trade, factors for succeeding in the Indian market. The
report states that large size of Indian retail market, low
organised retail penetration, strong GDP growth,
increasing personal incomes, large number of
aspirational consumers (middle-class, young Indians,
rural population, etc.) make India an exciting and
dynamic retail destination. It further states that the
Indian retail market is evolving rapidly, becoming more
competitive and retailers understand the importance
of meeting consumer demands. In such a competitive
environment, the main driver of competitive advantage
will be supply chain mastery. The use of supply chain
and logistics will make retailers agile and costcompetitive in a more crowded retail sector. ASA and
Associates (2012) report titled A Brief Report on Retail
Sector in India, gives an overview of India s retail sector,
growth in retail sector. It also describes government
policy with respect to retail sector and major global
players in Indian retail [15].
1.2
Objectives
Methodology
November 2014
01.
02.
03.
04.
05.
06.
07.
08.
09.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
USA
Japan
China
United Kingdom
France
Germany
India
Brazil
Russia
Korea (South)
Indonesia
Poland
Thailand
Pakistan
Argentina
Philippines
Malaysia
Czech Republic
Vietnam
Hungary
Total
Retail
Sales
(US$ bn)
2983
1182
785
475
436
421
322
284
276
201
150
120
68
67
53
51
34
34
26
24
Share of
Organized
Retail
85
66
20
80
80
80
4
36
33
15
30
20
40
1
40
35
55
30
22
30
Share
of Trad
itional
Retail*
15
34
80
20
20
20
96
64
67
85
70
80
60
99
60
65
45
70
78
70
2.2
Segment Analysis
E - Expected
Source:
1.
2.
3.
4.
1.
2.
Figure 1
Source: Author s Compilation
The Table 2 reflects that during the periods 2005-07
and 2007-10, the increase in share of organized retail
was not much. During these periods it increased by 13.9
percent and 21.9 percent respectively. However
thereafter organized retail is penetrating the market at
a more rapid pace. During the period 2010-12 share of
organized retail rose by 60 percent, its share in total
retail had just doubled and is expected to increase by
2.6 times during 2012-15. As mentioned in FICCI (2011),
over the next 10 years Indias retail market is expected
to grow at 7% and by 2020 it is expected to reach a size
of US$ 850 billion. The expected growth in traditional
retail is estimated to be at 5% while organized retail is
expected to grow at 25%.The traditional and organized
retail are expected to reach a size of US$ 650 billion(76%
of total) and US$ 200 (24% of total)billion respectively
by 2020[7].
Materials Management Review
35
Opportunities
36
November 2014
Product Localisation
Challenges
Solutions
Conclusion
37
November 2014
b.
References
[1]
[2]
[3]
[4]
[5]
[7]
[8]
[9]
infrastructure/...sectors/retailing.htm
[17] Girish K. Nair & Harish K Nair (2011). FDI in India
s Multi Brand Retail Sector: How to Get Ready for
the Big Play. Munich, GRIN Publishing GmbH
Retrieved April 9, 2013 from http://www.grin.com/
en/e-book/183618/fdi-in-india-s-multi-brandretail-sector-how-to-get-ready-for-the-big
[18] ASA (2013). A Brief Report on Retail Sector in India,
August, ASA and Associates chartered
accountants. Retrieved November 7, 2013 from
w ww.asa.in/asa-knowledge-bank-sur veysreports.asp
[19] Government of India (2012).Permitting FDI in multibrand product retail trading. Press Information
Bureau, Government of India. Retrieved April,5
2013
from
pib.nic.in/newsite/
erelease.aspx?relid=87767
[20] Mitra, Amit (2012). FDI in multi-brand retail can
strengthen supply chain links.18 November.
Retrieved
March
27,
2013
from
www.thehindubusinessline.com/.../fdi-inmultibrand-retail-can-streng
[21] Joshi Sandeep(2010). FDI in multi-brand retail
would impact the unorganized sector. The Hindu,
August 22. Retrieved August 5, 2013 from
w w w. t h e h i n d u . c o m / . . . / t p . . . / f d i - i n multibrand...would.../article587583.ece
[22] Tondon Suneera (2013): Govt notifies changes in
FDI norms for multi-brand retail, Live Mint and
The Wall Street Journal,23 August Retrieved
November 7, 2013 from www.livemint.com/.../
Govt-notifies-changes-in-FDI-norms-for-...
[23] KPMG (2009). Indian Retail: Time to change lanes.
Retrieved April 5, 2013 from www.kpmg.com/cn/
en/.../ pages/indian-retail-o-200904.aspx
[24] Menon Bindu D. (2013).Multi-Brand Retail: Has
India fallen off global players radar The Hindu
Business Line. Retrieved November 7, 2013 from
www.thehindubusinessline.com/.../multibrandretail...india.../article5210
[25] The Hindu (2012). Organised retail out-competes
Kirana.21 September. Hyderabad. Retrieved April
9, 2013 from www.thehindu.com Business
Industry
[26] Bijapurkar Rama, R Sriram & S Raghunandan
(2012). Decoding the Detail in Retail. 26 October,
Forbes India. Retrieved March 27, 2013 from
infostreams.in/2012/10/26/decoding-the-detailin-retail/
Source : www.iosrjournal.org
November 2014
39
November 2014
November 2014
41
BIS NEWS
BIS PUSHES FOR STANDARDS
FOR ALL PRODUCTS
DIPAK K DASH
stage, he added.
Sources said that the agency has already taken up
the issue of enforcement of the standards by
manufacturers with other departments or wings
that also set standards such as Bureau of Energy
Efficiency (BEE). TOI has learnt that BIS can set up
a special wing that can pick up random samples
from the market and carry tests to find compliance
so that actions can be initiated against those
selling spurious and sub-standard goods.
However, considering there will be a flood of
applications for standard certifications, the
government is now pushing for more self
certification by the manufacturers. Soni said
across the world, about 80% business is on self
certification mode. But this does not mean that
the manufacturers will have a free run.
November 2014
WTO UPDATE
AID FOR TRADE MEETING HIGHLIGHTS NEED TO
GIVE GREATER SUPPORT TO SMALL BUSINESSES
43
November 2014
BRANCH NEWS
AHMEDABAD BRANCH
AURANGABAD BRANCH
KOLKATA BRANCH
AHMEDABAD BRANCH
Ahmedabad Branch had a Multi Event on 11th October
2014 in Lecture Hall of Ahmedabad Management
Association.
MUMBAI BRANCH
VADODARA BRANCH
November 2014
45
November 2014
m
aLp.
47
48
November 2014
AURANGABAD BRANCH
IIMM Aurangabad organized a Mega Signature program
Second Mat Select - Signature was held on 29th
September 2014 at Hotel Rama International ,
Aurangabad. Theme of the program was INNOVATIVE
WAYS OF PROFIT OPTIMISATION. Chief guest for this
program was Mr. Rishikumar Bagla. Chairman &
Managing Director, Bagla group of industries and guest
of Honour was Mr. Lalbhai Patel, National President,
IIMM.
49
November 2014
KOLKATA BRANCH
Annual General Meeting : The Annual General Meeting
(AGM) of Kolkata Branch was held on Friday, the 18th
July, 2014 at the Senator Hotel, Kolkata. Good standing
members of the Branch were served Notice of the AGM
along with the Branch Chairmans Report, Auditors
Report, Balance Sheet and Income & Expenditure Account
as at 31st March, 2014 well in advance. The Meeting
was well attended by 75 members and few invitees. The
activities of the Branch throughout the year were
discussed by the attending members and appreciated
the enthusiastic Executive Committee for their untiring
efforts to keep the Branch vibrant. Members were
welcomed to the AGM venue with snacks and tea. Mr.
Koushik Roy, Hony. Secretary, steered the proceedings
according to the Notice of the AGM welcoming all sharp
at 6.30 p.m.
Inauguration of GDMM Regular July 2014 Session IIMM Kolkata Branch - Mr. D.K.Acharyya - Course
Coordinator IIMM Kolkata Branch & BOS Member, Mr.
D.N.Chakravorti - Sr. Faculty Member, IIMM Kolkata &
BOS Member, Mr. S.K.Mukherjee - Sr. Faculty Member,
IIMM, Kolkata, Mr. Sanjay Mukherjee - Sr. Faculty, IIMM
Kolkata
November 2014
51
Organizing Seminars.
Selling of Bricks.
Roping in Corporate.
Engagement of Professional Publicity Consultant.
Donation by Members.
The Chairman also announced that a Building Subcommittee had been formed to facilitate the whole
process as follows :
Mr. Sudhin Mitter, Chairman, Mr. Animesh
Chattopadhyay, Convenor, Mr. Samiran Basu, Mr.
Sukalyan Sarkar, Mr. Koushik Roy, Mr. Niladri Chatterjee,
Mr. V K Mani, Mr. J B Roy Chowdhury, Mr. S B Sarkar and
Mr. Suranjan Mukherjee.
November 2014
MUMBAI BRANCH
In-house Training Program at Rashtriya Chemicals &
Fertilizers Ltd (RCF) : On 20th September, 2014, IIMM,
Mumbai branch conducted a one day intensive Training
Program on Costing Estimation - Supporting Skills &
Knowledge for the employees of RCF at their Trombay
Plant, Chembur, Mumbai.
53
VADODARA BRANCH
An Evening Talk on the Topic of How To be Successful
Entreprenuer in Materials Field? by Shri VIJAY J. SHAH
had been arranged on 13th Sept. 2014 from 6.30 pm to
8.00 pm at IIMM Hall wherein more than 30 participants
comprising of Members & Students attended the same.
Mr. Vijay Shah shared the experiences from the tenure
of 30+ years which get appreciation by all. The students
enriched their knowledge to utilize in their Materials /
Procurement Profession.
November 2014
55
EXECUTIVE HEALTH
OUR HEALTH: ARE WE REALLY AWARE?
DR R S KHAMBETE
GROUP VICE PRESIDENT SHALBY HOPSITALS, GUJRAT
rajendra.khambete@shalby.org
Do we know consequences of our behaviours and
lifestyles and health risks they present?
November 2014