mr r harikumar

8/16/2019 Mr R Harikumar

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Next Generation Supply Chain 2020 @ CII

Next Generation

Supply Chain 2020

R. HarikumarVice President

Supply Chain

Maruti Suzuki India Ltd


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• Current Challenges

• Macro Factors to Reshape 2020

• Way Forward

Topics covered


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Uttarakhand

Disaster

Difficult times


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Volatility in

Commodityprices

Supplier Risk

Foreign Exchange

Fluctuation

Logistics Congestion

Current Challenges & pain areas

http://www.google.co.in/url?sa=i&rct=j&q=supply+chain&source=images&cd=&cad=rja&docid=AhKHyGGwtnVTHM&tbnid=wITU5Gd2tWzHeM:&ved=0CAUQjRw&url=http://www.indiamart.com/shalubai-logistics/services.html&ei=M4NBUZe-He-ImQW87IGgCw&bvm=bv.43287494,d.ZWU&psig=AFQjCNGGDwbmg-9dV5oG-L5mMDAOTE5O8A&ust=1363334050376994


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Earlier Business

Scenario

Current Challenging

Environment

Cost Plus Target costing

Build to printOwn Design

Capability

Local suppliersGlobal suppliers &

Follow Sourcing

Lifetime Volume

commitment

No Volume

commitment

Shifting trends of Cost Challenges

Volatile MarketStable Market

Rising Commodity priceStable Commodity price


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MSIL Inbound Logistics Overview

EMS Presentation

MSIL

WAREHOUSES AT GURGAON ~ 4-6 KM

PORTPORT

70 TRUCKS/ WEEK

NORTH

242PLANTS

WEST

36 PLANTS

SOUTH44 PLANTS

EAST

5 PLANTS

Line Feed

MTL TO MSIL

MTL TO W/H

NO MILK-RUN

NO MILK-RUN

NO MILK-RUN

M S I L A s s y .

L i n e

http://e/My%20Documents/OUT%20SATION%20VENDORS.ppt


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Risk exposure & Supply Chain Vulnerability



OEMs

Supplier

Vendor

Vendor OEMsSupplier

Working in isolation its difficult to handle the Challenges

Working together in Harmony and Long Term Relationship is the key to

success

Key to success in difficult times



Macro Factors That Will Reshape 2020

Logistics

2020

Volatility of OilPrices

New TransportCorridors

GST

PervasivePowerful

Technologies



Supply Chain Ecosystems

Assets

• Location• Infrastructure

• Industry

• Supply ChainCapability

Supply Chain

Ecosystems• Collaboration

• StrategicAllignment

• Partnerships

Outcomes

• Lower Cost• Reduced Time

• Reduced Risk



India’s Third Party Logistics (3PL)

More Than 50% of Logistics Market in Developed

Countries is 3PL

0%

5%

10%

15%

Western Europe North America India

Logistics Cost % of its GDP

Transport & Logistics Industry in India grew at CAGR of

more than 16% from 2007 to 2010



Way Forward

Adopting Advanced IT Application

Addition of New Freight Corridors

Next Generation Logistics (Ships/ Trailers)

Lean Manufacturing

Resource Optimization



Major IT Applications Adopted by

Logistics Globally

Global

PositioningSystems

BarcodeSystems

Electronic

DataInterchange

RadioFrequency

Identification

AutomatedSortingSystem

ElectronicOrderingSystem



Addition of New Freight Corridors

Golden Quadrilateral along with its Diagonals spans a

route length of 10,122 kms.

Need for addition of New Freight Corridors to expand

Transport Volumes.



New Generation Logistics

New Generation Ships & Trailers required for Reduced

Emission & Reduced Fuel Consumption



Milk Run System

Supplier

Controlled material

collection withPick-up Sheets

Check-calls

Controlled material

collection with

Pick-up SheetsSupplier

Plant

Delivery

to MSILEmpty Container Return

Benefits Achieved:

• No of trucks coming to MSIL reduced by 20%

• Decongestion in MSIL & Timely Supplies

• Reduced follow-up and Real Time Tracking of Trucks



Lean Manufacturing- Reduce lead time

at every StepIllustration

Adopt and implement a philosophy which shortens the time line between the customer

order and the product shipment by eliminating waste.

Conversion Time

Saleable

Start of activity

Non saleable + Waste

Wait TimeMove Time Down Time

Total Lead Time

End of activity



Lean Chain-MSIL Approach

“Sho , sho, Kei, Tan, Bi”

“Smaller, Fewer, Lighter, Shorter, Neater”

R O i i i I i i i f K il i



F o r w a r d J o u r n

e y : E x p o r t s C a r s

f r o m s

t o c k y a r d t o P o r t

R e t u r n J o u r n e y : S t e e l C o i l s f r o m

p o r t t o

S t o c k y a r d

3 Coils: 54 MT5 Cars

xxMulti-purpose Container - KOILTAINER

Benefits: Optimal Rake Utilization, Reduction in Truck load in MSIL

Forward Journey -> Export Cars; Return Journey -> Steel Coils:

Resource Optimization: Initiative of Koiltainer



Thank you R Harikumar

Vice President

Supply Chain

Maruti Suzuki India Limited



Ericsson Inputs

Tej Nirmal Singh

Head of Supply – Region India



Market outlook 2015

• Growth Mobile Broadband

– 50 billion connections

• Network Modernization

– ‘Live’ networks - Technology upgrade

• Technology Change

– 4G, 5G …….

– Cloud

• Use of connectivity in Unconventional items

– Utilities

– Transport, etc



Supply chain opportunities

• Reverse Logistics

– Controlled flow

– Synchronized deliveries & Removals

• Inventory Management

– Robust Warehouse Management System

– Mobile/ handheld device Operations

• Skilled Resources

– Organized Trainings & Skill building

– Control attrition

• Professional Service Providers

– Resource Providers

– Transport Companies



Supply chain opportunities….contd

• E2E Service Provider

– With Strong Processes & Controls

• Hub & Spoke setup for Project Logistics

– Efficient Distribution Park

– Product Customization/ Configuration

• Productive Infrastructure

– Roads & Rails

– Warehouses



CII MEETING

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INPUTS FROM THE FASHION RETAIL SPACE

ABHIK SAHA

DIRECTOR – SUPPLY CHAIN

BENETTON INDIA PRIVATE LIMITED


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Supply Chain : Functional Journey

• Historically, largely non-existent as a practice.

• Clubbed under the overall umbrella ofManufacturing.

• Coming to Age of Demand Planning and PPC.

•Increasingly finding CEO and Board relevance.

• Shift from forecast based to replenishment based.

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Supply Chain : Current Strategy

• CEOs are increasingly de-coupling the front end.

• Split focus between inventory and customer experience.

• SCM increasingly responsible for managing the demand.

• Accountable for excess as well as shortage of inventory.

• Availability no longer an issue of Sales Forecast.

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Supply Chain : Impact

• Lean SCMs dynamically responding to consumer tastes.

• Revenue growth through reduced stock-outs.

• Reduced discounting through managing a smaller tail.

• Spearheading strategy on Cash Flow and quality ofBalance Sheet.

• Value of SCM vs. just Cost being increasingly important.

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INPUTS FROMMONDELEZ INTERNATIONAL


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Currently, 3 Distribution Centers still servingwithin a radius of 90kms. due to taxes on

inter-state sales

India is expected to finally move to GSTby 2014, with implications on the supply

chain

FARIDABAD

DELHI

GHAZIABAD

U.P

HARYANATrade has undergone atransformation, with Modern Retail still

growing at a tremendous pace

Need to be responsive to high service levelsand product freshness demanded by

modern trade

Competition is intensifying, challengingdominance of Market Leaders

Supply Chain‟s Strategic Imperative: To continually support high growth trajectory and

simultaneously respond to rapid changes in its customer, competitor and regulatory environment

27%Sales (USD Mil.) andCAGR (2006 – 2012)

Company is continuously growing

130

190

260

345

430

570

700

2006 2007 2008 2009 2010 2011 2012


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• Regulatory• Economic

• Affordability

• Customer Plans

• Sales Resources

• Distribution Plans

• Product plans

• Price

• Size, growth and share

• Consumer insight

• Strategic goals

• Business Plan• Brand Plans

Strategy Market

ExternalCustomer

To support a continuous growth agenda, Demand cannot be an SCM domain alone

If Sales & Marketing is Akbar “the King”, SCM has to be the Birbal “the Counsel”

Demand is a multidimensional view


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Product Portfolio keeps competition “aside”

• New Products

• New Channels

• Product

changes, improvementsand rationalization

• Repositioning

Sufficiently Plan „NEW‟ in business to counter competition and continually fuel growth

Sales

Ambition ofcontinuous growth

Keeping your bets onpresent portfolio


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Customer Delight demands a different Supply Chain focussed on

serving them rather than itself

Shift from “own” KPI focussed supply chain to an Integrated Supply Chain walking the tight rope

Optimize OPERATINGCOSTS


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Need of Business 2020

Move from Demand - Supply matching S&OP ofnext three months at SKU level

to

Integrated Business Planning whichlinks Strategy to Execution

(Demand, Product and Supply

interwoven financially)for next twenty four months atProduct Family Level