project reprot supply chain
TRANSCRIPT
Project reprot :-
Subject:-
Submitted To:- Sir Hashim khan
Submitted by :- Imran khan (4491)
Sadaquat khan (44 )
Muhammad idrees( 44 )
Date…. 28/10/2010
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Acknowledgements
I owe profound thanks and deepest sense of gratitude to Almighty ALLAH the Beneficent and
the Merciful Who blessed us with determinations, the required potential and ability to complete
this piece of project work. No words to describe our sweet sensation about our affectionate
parents, family members and friends, because without their prayers and shadow of love, perhaps
it would be impossible to attain this target
I acknowledge with immense pleasure and want to describe our feelings of respect for our Atlas
Honda employs valuable guidance, inspiring criticism, zealous interest and constant
encouragement during the project. We found him to be very helpful and hardworking person. I
want to thanks all the personalities who have been a source of guidance during my research,
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Industry Analysis
Motorcycle Industry estimates show that last year a total of over 750000 motorcycles were sold in the country The industry has been experiencing a healthy growth rate of around 30%per year for the past 4-5 years. Pakistan came at number seven with a production of 750,000 units of motorcycles constituting to 2%of the global total.
Market Share of Motorbike in Pakistan
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Vision
Market leader in the motorcycle industry, emerging as a globally competitive centre of production and exports.
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Mission
A dynamic growth oriented company through market leadership, excellence in quality and service and maximizing export, ensuring attractive returns to equity holders, rewarding associates according to their ability and performance, fostering a network of engineers and researchers ensuing unique contribution to the development of the industry, customer satisfaction and protection of the environment by producing emission friendly green products as a good corporate citizen fulfilling its social responsibilities in all respects.
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Company Strategic GoalsCustomers
Our customer is the reason and the source of our business. It is our joint aim with our dealers to ensure that our customers enjoy the highest level of satisfaction from use of Honda Motorcycles.
Quality
To ensure that our products and services meet the set standards of excellence.
Local Manufacturing
To be the industry leader in indigenization of motorcycles parts.
Technology
To develop and maintain distinct business advantages through continuous induction of improved hard and soft technologies.
Shareholders
To ensure health and viability of business and thus safeguarding shareholders interest by maximizing profit. Payments of regular satisfactory dividends and adding value to the shares.
Employees
To enhance and continuously up-date each member's capabilities and education and to provide an environment which encourages practical expression of the individuals potential in goal directed team efforts and compensate them attractively according to their abilities and performance.
Corporate Citizens
To comply with all government laws and regulation, to maintain high standard of ethics in all operations and to act as a responsible members of the community.
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ATLAS HONDA Pakistan
Pakistani conditions. Company management structure, systems and processes are
reviewed periodically according to the demands of the-customer. - Decision making in the
Company in participation of all levels of personnel besides substantial and effective delegation
has been established at levels where applicable. Various participation programs such as 'Ala
Mayar' Quality Circles movement, launched in 1985, are encouraged to allow constructive self-
expression and teamwork. The Company training and development programs encourage
members to develop themselves and-contribute-to-their-full-potential.Atlas Honda is playing a
pioneering role in creating conditions for easy and confident use of motorcycles all over the
country. A vast and growing network of over 1600 motorcycles sales service and spare parts
dealers has been established.In order to back up this system, Atlas has set up Technical Training
Centers in Karachi and Lahore which provide several courses of varying duration and
complexity for motorcycle mechanics and users each year. Mobile training facilities take the
latest know-how, technology and maintenance of motorcycles to major rural and urban centers
around the country.
COMPANY INFORMATION
THE BOARD OF DIRECTORS
Mr. Yusuf H. Shirazi Chairman
Mr. Saquib H. Shirazi CEO
Mr. Koji Nakazomo Director
Mr. Nurul Huda Director
Mr. Sanaullah Qureshi Director
Mr. Sherali Mundrawala Director
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Mr. Toshitsugu Kaneko Director
Mr. Yoshitaka Kitamura Director
COMPANY SECRETARY
Mr. Zaryab Tarique
AUDIT COMMITTE
Mr. Sanaullah Qureshi Chairman
Mr. Sherali Mundarwala Member
Mr. Nurul Hoda Member
Mr. Amir Shakoor Khan Head of internal audit
Mr. Ashfaq Ahmad Secretary
GROUP EXECUTIVE COMMITTEE
Mr. Aamir H.Sherazi Chairman
Mr. Frahim Ali Khan Member
Mr. Iftikhar H.Sherazi Member
Mr. Jawiad Iqbal Ahmad Member
Mr. Saquib H.Sherazi Member
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Mr. Theresa Dias secretary
GROUP PERSONAL COMMITTEE
Mr. yousuf H Sherazi Chairman
Mr. Aamir H.Sherazi Member
Mr. Bashir Makki Member
GROUP SYSTEM & TECHNOLOGY COMMITTEE
Mr. Iftikhar H.Sherazi Chairman
Mr. Mustaq Alam Member
Mr. Zia Ullah Begg Member
MANAGEMANT COMMITTEE
Mr. Saquib H. Shirazi CEO
Mr. Nurul Huda VP Marketing
Mr. Toshitsugu Kaneko VP Technical
Mr. Suhail Ahmad CFO
Mr. Amir Awan GM Plants
Mr. Maqsood A.Basra GM CAMA
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BANKERS
Bank Al-Habib Limited
Credit Algricole Indosuez
Deutch Bank AG
Emirates Bank International P.J.S.C.
Habib Bank Limited
Muslim Commercial Bank Limited
National Bank of Pakistan
The Bank of Tokyo Mitsubishi Limited
United Bank Limited
REGISTERED OFFICE
1-McLeod Road, Lahore.
FACTORY
F-36, ESTATE AVENUE, S.I.T.E., KARACHI
26-27 KM, LAHORE-SHEIKHOPURA ROAD, SHEIKHOPURA26-27 KM, LAHORE-SHEIKHOPURA ROAD, SHEIKHOPURA
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Introduction of Atlas GroupThe Atlas Group comprises of 7 public and 4 private limited companies, with over 5,000 staff members. The foundation of the Atlas Group was laid by Mr. Yusuf H. Shirazi, in 1962 with the establishment of Shirazi Investments (Pvt) Limited with a capital of half a million rupees and three men - doing business in Trading Shares and R real Estate. Shirazi Investments is now one of the leading investment companies in Pakistan engaged in trading shares, fund management, underwriting, real estate and warehousing. The Company has played a key role in the promotion and acquisition of the Atlas Group of Companies.The growth of the Atlas Group is the result of its focus on good corporate governance. The Group's equity has risen to Rs. 15 billion; assets have exceeded Rs. 25 billion and sales have crossed the Rs. 30 billion mark. The Group paid taxes of Rs. 9 billion equivalent to 1.5% of the total government revenues. All this progress is due to the Group's reliance on the intellectual capital, dedicated efforts and team spirit of all the stakeholders. Every member is striving for excellence and taking pride in the Group's motto:
Atlas group operates in three sectors:
1-Engineering Sector
2-Trading Sector
3-Financial Sector
Engineering Sector
The Engineering Sector includes the following listed companies.
1- Atlas Honda Limited
2- Honda Atlas Cars (Pakistan) Limited
3- Allwin Engineering Atlas Engineering
4- Atlas Battery Limited
5- Atlas Power
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2- Trading Sector
The Trading Sector includes the following listed companies.
1-Shirazi Trading Co. (Pvt.) Limited
2- Honda Atlas Power Product (Pvt.) Limited
3- Total Atlas Lubricant Pakistan (Pvt.) Limited
Financial Sector
Atlas Group has following three financial companies.
1-Muslim Insurance Company Ltd. Shirazi Capital
2-Atlas Investment Bank Ltd
3-Atlas Asset Management Co. Ltd
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Atlas Honda Limited
Atlas Honda Limited is a joint venture between the Atlas
Group and Honda Motor Co., Japan. The company was created by the merger
of Panjdarya Limited and Atlas Autos Ltd. in 1991. Both these motorcycle
manufacturing concerns were established by the Atlas Group. In addition, a
third concern, Atlas Epak Ltd. was taken over by the Government of
Bangladesh. Atlas Honda Limited manufactures and markets Honda
motorcycles in collaboration with Honda Motor Company. The Company also
manufactures various hi-tech components in-house in collaboration with
leading parts manufacturers like Showa and Toyo Denso. Honda motorcycles
are by far the best selling motorcycles in the country with an unmatched
reputation for high quality, reliability-and-after-sales-service.Atlas has
undertaken to develop local manufacturing capabilities to the highest,
economically feasible level. While a major role in localization has been
assigned to vendor industries, Atlas has the country's largest in-house
manufacturing capability in the country at its Karachi and Sheikhupura
plants. To support the production facilities, the company has established an
R&D wing and tool making facilities which are growing rapidly in size and
function as the company expands.Atlas has managed to execute 12 Joint
Ventures and Technical Assistance Agreements between local vendors and
foreign manufacturers for transfer of technology besides Atlas has
directly executed 9 Joint Ventures-and (TAA) Technical-Assistance-
Agreements-other-than-with-Atlas Honda Ltd management is striving to
modernize company operations by adapting applicable aspects of research
and theory and more specially, Honda's unique philosophy of hard and
soft technologies to the realities of Pakistani conditions. Company
management structure, systems and processes are reviewed periodically
according to the demands of the-customer. - Decision making in the
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Company in participation of all levels of personnel besides substantial and
effective delegation has been established at levels where applicable. Various
participation programs such as 'Ala Mayar' Quality Circles movement,
launched in 1985, are encouraged to allow constructive self-expression and
teamwork. The Company training and development programs encourage
members to develop themselves and-contribute-to-their-full-potential.Atlas
Honda is playing a pioneering role in creating conditions for easy and
confident use of motorcycles all over the country. A vast and growing
network of over 1600 motorcycles sales service and spare parts dealers has
been established.In order to back up this system, Atlas has set up Technical
Training Centers in Karachi and Lahore which provide several courses of
varying duration and complexity for motorcycle mechanics and users each
year. Mobile training facilities take the latest know-how, technology and
maintenance of motorcycles to major rural and urban centers around the
country.
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Quality Policy
• Commitment to provide high quality motorcycles and parts.
• Light work in first attempt and on time.
• Maintain and continuously improve quality.
• Training of manpower and acquisition of latest technology.
• Safe, clean and healthy environment.
• Market leadership and prosperity for all.
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Environmental Policies
• Reduce and prevent the generation of waste and pollution in our production system.
• Establish management program to promote energy conservation and reduce waste.
• Comply with requirements of environmental legislation and local regulations as a
responsible corporate citizen.
• Promote relevant environmental protection knowledge and activities through
education and training.
• Initiate and extend environmental improvement activities from the company itself
to its business partners including parts manufacturers, general suppliers and
dealers.
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CEO
Finance Marketing Supply chain HRM R & DQuality
Procurement Warehouse Production Control
Imports
Local
SAPRM
Chairman
Organization Structure
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Company Supply chain
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Customer Dealers Assembly /manufacturing plant
CentralWarehouse(Sheikapura)
Part assembling(Karachi)
Local95% CD-7085% CD- 125
Import5% CD-7015% CD- 125
Dynamics of Material Flow
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ProcurementSuppliers
RetaiLogisti
cs Warehous Plant Supplier
Dynamics of Order Flow
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SAP “System Application & Products"
Master production scheduling (MPS)Material Requirement Planning (MRP)
Procurement Process:
1) Forecasted Procurement:
2) Bill Of Material (B.O.M.)
3) Price Negotiation
4) Performa Invoice is called
5) Purchase Order is placed
6) Establish Letter of Credit (L.C.)
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Supplier Plant Warehouse Logistics Retailer
Long range capacity planning
Aggregate Planning
Master Production Scheduling
Production Planning & control system
Pull SystemPush System
7) Revival and Recovery of Original Documents:
- Bill of Lading
- Invoice
- Letter of Credit
8) Clearing Agents
Delivery and Possession of Material
Production Planning
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Atlas Honda total plant capacity is 500,000 units in Shaikhupura and 105,000 units in Karachi.
But Honda produces motorbikes according to the market demand and customer demand, because
of this reason their plant always operates under capacity.
Atlas Honda planned to produce 400,000 units of motorbike during the current fiscal year that is
2006-07. But they are expecting to achieve 350,000 units of motorbikes during the current fiscal
year.
Atlas Honda is using both push as well as pull system. Push system is use before assembly plant. Pull system is used after they assemble the required units and supply their motorbikes to their dealers so that dealer could fulfill the customer’s demand
NEW NEW PRODUCTION PLANTPRODUCTION PLANT
Atlas Honda Ltd. began operations of its new motorcycle factory in Sheikhopura earlier in the
day, which increases its annual motorcycle output capacity from 400,000 units to 500,000 units.
The investment in the plant is about Rs1.8 billion. Production efficiency will be improved at the
new factory by cutting down on inventory, Honda Motor said. Atlas Honda aims to respond to the
growing demand for motorcycles in Pakistan, Honda said. The market has been expanding
rapidly, and is expected to grow to 800,000 units in 2006. For capturing more market share
marketing department perform following activities
1. NEW MODEL
2. CHANGES IN DESIGN
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3. INHOUSE PRODUCTION
NEW MODEL
In order to get more market share atlas Honda has been introducing new models over the time. The
most recent model was launched by them in this way is Honda CG 125 deluxe. Although they
introduced new model with the passage of time but the company maintained the quality
throughout the time.
CHANGES IN DESIGN
There was a great demand from the customers to launch a new model but it is a difficult job to launch a
new model so in order to fulfill the customer wants the company has a policy to change the stickers of fuel
tank and side covers and some other nominal changes in indicators headlights etc. but the engine
and other main accessories were not changed.
INHOUSE PRODUCTIO
At the outset of company 90-95% parts were imported from Japan and were assembled in
Pakistan. With the passage of time company introduced the concept of localization the company
encouraged the local vendors and suppliers to produce the parts of motorcycle according to the
level of Honda international. So in order to maintain the quality, the parts made by local vendors
were approved by the Honda international and after that they were used in local production. So
now atlas Honda has managed to localize almost 90% of the parts. Still 10% parts are imported
from Japan. The atlas Honda also provides assistance to their vendors to maintain high quality.
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They send their engineers to check the quality and to train the vendors in order to produce the
required qualitative product.
PRICE
The atlas Honda has four products and their prices are as under.
HONDA CD 70 Rs. 62,900
HONDA CD 100 Rs. 69,000
HONDA CG 125 Rs. 83,400
HONDA CG 125 DELUXE Rs. 89,900
The company uses the single price strategy means the product has the same price all over the
PakistanEarlier atlas Honda was the only producer of qualitative four-stroke motorcycle in
Pakistan. So they were taking the advantage of this monopolistic situation and using the price
skimming strategy and were charging highest pricing.
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Product Range
Atlas Honda has four products (brands)
HONDA CD 70
HONDA CD 100
HONDA CG 125
HONDA CG 125 DELUXE
HONDA CD 70
Honda CD 70 is the No. 1 choice in motorcycles. In to its
established superiority in terms of great speed and fuel economy, the
Honda CD 70 is presented with special features. The new
attractively designed CD 70 is right there at the top, with an
aerodynamic shape, super econo-power, a smoke-free 4-Stroke
engine and the special Honda 12-volt CDI technology.
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HONDA CD 100
Quality, Performance, Speed, Economy Petrol and Re-sale
Value define Honda Motorcycles. All these have managed to successfully bag your trust on the
New Hon da CD100. It is a stunning result of advanced Japanese technology and right up they’re
as an outstanding performer representing all the qualities that
make Honda motorcycles so special.
HONDA CG 125
New Honda CG 125 is the ideal combination of elegance and
power. Its speed and performance symbolizes the true essence of
modern lifeThe 125 cc 4-stroke engin e generates 11-Horse
Power with low fuel consumption. It is ideal for high speed, long runs and rough
pathways.Honda CG125 has a CDI Ignition System and a 12-volt battery (instead of 6-volt). The
headlight and indicators are brighter, with an easy starting-up of the engine.
HONDA CG 125 DELUXE
HONDA CG 125 DELUXE is newly launch bike of the Atlas Honda company. It’s also a 4
stroke engine and ideal for high speed, long run and rough pathways. It’s specially manufactured
for the young people because of its excellent speed and
this bike getting good response from the youth.
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PLACEMENT
Atlas Honda gained good market share due to its strong distribution network. For distribution atlas
Honda has divided the whole country into two regions.
1. SOUTH REGION
2. NORTH REGION
SOUTH REGION
Includes following territories
Karachi
Karachi region covers whole Sindh province
Quetta
This covers whole Baluchistan province
NORTH REGION
It includes following four regions.
Multan
Lahore
Rawalpindi
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Competition1. Yamaha
2. Suzuki
3. Sohrab
4. Pak hero
5. Hero
6. Star
7. Lifan
8. Jailing
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Components
Imported 5%
Locally Procured 95%
Procured 95%Lead Time:
6 monthsLead Time: 1 week
MANUFACTURING
Overview:
Total number of assemble parts 350 parts for each product.
Imported parts (CD-70) 5%
Imported parts (CD-125) 15%
Shifts in Karachi 1
Shifts in SKB 24 hour
CD 70:
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Components
Imported 15%
LocallyProcured 85%
Lead Time:6 months
Lead Time: 1 week
CD 125:
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Manufacturing Process:
In Atlas Honda there are total fourteen processes, as follows:
1. Frame Assembling
Where frame of motorbikes are produce in bulk
quantity.
2. Paint shop
In paint shop nearly 110 parts of motorbikes are being painted at present.
3. Buffing
Buffing shop used to buffer 35 components of motorbike
4. Alternative Current generation
This department works on electric works in a motorbike from engine wiring to ignition switch and light
5. Drum Gear Shift
This shop works on all work related to gear and chain
6. Drum Gear Shop
This department used to work on drums on front as well as rear drum
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7. Machine Shop
In this department all the extra machine work is done
8. Fuel Cope
Fuel tank and other material related to fuel e.g. filter and carburetor are assembling here.
9. Die casting
In this department chrome of metal parts done by Honda by own.
10.Engine Assembling
In this shop engine is assemble in proper form to fit into chassis or frame
11.Wielding
All the necessary wielding are done here regarding frame etc
12.Ignition Coil Shop
This shop related to work on ignition coil, which is right beside engine to produce electric for engine and light
13.Switch Assembling
Where switch of motorbike made and assemble in complete form
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14.Engine Machine Assembling
Here engine is attached to frame and check whether is working fine or not
Bottlenecks
In Atlas Honda supplier are considered as bottlenecks …
Bottleneck
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Supplier ProcurementPart
Assembling
karachi
Central warehouse (Sheikapur)
Assembling/Manfacturing
plantDealers
Warehousing STORES
Stores dept.
AHL performs following functions:
Manages the receiving, stacking & issuance of parts &materials to the shop. Ensures the provision &dispatches of required parts to SKP & KHI plant, spares part division &vendors. Handles the rejections &damages from all shops Handles the scraps & wastes generated in the factory
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Handling TechniquesAt AHL, following handling techniques are used: For handling from shop to shop especially designed trolleys, bins and pallets are used. Imported motorcycle components are received in Steel & wooden cases & pallets. Local vendor parts are received from receiving section in standard carton boxes.
VENDOR PROCUREMENT
At present, many vendors are working with the company.
This department performs following functions.
This department is responsible for all the relations and dealing with the different vendors.
This department motivates vendors to produce excellent quality and train them to achieve
the highest level of quality.
This department also deals with the CKD (complete knock down system).
This department performs VIP (vendor improvement programmed). Under this
programmed the department representatives go to the vendors and train them for new methods to
produce better quality at reasonable price.
Functions:
This department is responsible for all the relations and dealing with different vendors.
This department motivates vendors to produce excellent quality and train them to achieve the highest level of quality.
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This department performs VIP (vendor improvement program). Under this program, the department representatives go to the vendors and train them for new methods to produce better quality at reasonable price.
Dealers
Atlas Honda has established countrywide dealers’ network..
“5S” dealers
5s stands for the following five facilities
Sale ServiceSpare partsSpecial saleSecond hand sales
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Dealers, Spare Parts & sale Atlas Honda has massive dealers all over the Pakistan few of them as……….
Quetta;
Name: HONDA POINT Contact To:Mr. Khurrum Shahzad
Services: 5S Dealer Contact#:081-2667925
Email: Cell#:0300-9380266
Address: Sitara Hotel Building, Liaquat Bazar, Quetta
Name: Zubair Autos Contact To:M. Afzal, Mr. Agha Moazam
Services: 5S Dealer Contact#:042-37571304, 37538372
Cell#:0300-4180969, 0323-4276154
Address: 139 - Multan Road, P.O. Iqbal Town. Lahore
Name: FAISAL AUTOMOBILE Contact To:Mr. Shaheen Anwer
Services: 5S Dealer Contact#:32729003 - 32729004
Email: Cell#:0300-9286713
Address: Shahrah-e-Liaquat, Saddar, Karachi
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Major Selling Cities
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Atlas Honda
Lahore Karachi Sheikapura Sialkot Quetta Gujranwala
Transportation
Type of trucks and thereCapacity:
HINO (125 motorbikes) to quetta
BEDFORD (110motorbikes) to quetta
MAZDA (65 motorbikes) to quetta
Charges of Transportation
BY HINO :- its take RS 35000
By MAZDA Track:-its take RS 30000
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BEDFORD Trcuk:-
Its contain 110 motor cycle and
Charge par bike 25000Rs….it is little lower
Mode of transportation…………..
By Train:- Atlas Honda company does not use the Train transportation to send bike to any city of Pakistan..becoz its take lot of time to deliver the bike on minimum time………..
AHL -- BUILDING A BETTER WORLD
Service training to VTI student
Atlas is engaged in providing technical training to student of vocational training institute. At our
service centre, different experts gave briefing and practical training to a batch of 15 students. The
training is of 30 days and comprised by all service technicalities. Training certificates were also
given to these students.
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Corporate Donation- Earth Quake Relief Fund
In the hour of national tragedy and devastation caused by the recent earthquake, Honda motors of
Japan and Atlas group, its local partner pledged all out support by contributing nearly Rs. 60
million to “President relief fund for earthquake victims” as well as providing urgent medical
support to its associates and their loved ones residing in the affected areas.
Further in the rehabilitation stage Honda and the Atlas group are not only planning to support to
reconstruct the devastated Honda dealers showroom, 4 stroke service centre and the spare parts
network but also providing mechanical training to unable the youth to become self employed and
support the transport infrastructure.
Collectively the major Japanese corporation and their local partners have so far contributed in
excess of US $ 25 million to the relief funds efforts.
Safety riding training
Including the attitude of safe motorcycling in oneself is becoming more and more essential in view of ever increasing no of accidents. Accordingly our customer care department conducted about 460safety riding sessions for understanding the importance of safe driving attitude.
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