A STUDY ON

“SUPPLY CHAIN MANAGEMENT”

ULTRATECH

1
 ABSTRACT

This conceptual paper outlines the importance of integration in supply chain management
(SCM) by linking the functions of logistics as it applies in strategic business process. Often,
business processes are developed at the strategic level but are never identified precisely in
logistics or in SCM. Strategic business processes like Customer Relationship Management
(CRM), Supplier Relationship Management (SRM), Customer Service Management (CSM) and
Demand Management are not directly linked to logistics or SCM. This paper identifies the
literature that expressed the importance of integration and how business processes can be
relevant in the execution of key logistics activities in the supply chain context.

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 INDEX

S.NO NAME OF THE CHAPTER PAGE NO.

CHAPTER-1 INTRODUCTION
NEED OF THE STUDY
OBJECTIVES OF THE STUDY
SCOPE OF THE STUDY
RESEARCH METHODOLOGY
LIMITATIONS

CHAPTER-2 REVIEW OF LITERATURE

CHAPTER-3 INDUSTRY PROFILE

COMPANY PROFILE

CHAPTER-4 CODING
IMPLEMENTATION

CHAPTER-5 FINDINGS
SUGGESTIONS
CONCLUSION
BIBILIOGRAPHY

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 CHAPTER-1

INTRODUCTION

4
 INTRODUCTION OF TOPIC

Historically, the word logistic was derived from the term “logistician’’ which was the
role of the chef de lôgis who was responsible for finding accommodation for the troops during
the time of Napoleon Bonaparte (Van Creveld, 2004). Logistics as an activity however, has now
evolved and in the business world, logistics relates to the management of the flow of products or
services from the point of origin to the point of consumption. According to Bowersox (2007),
logistics is engaged in a wide range of important activities for the transfer of goods, services and
related information. This is where the importance of logistics is further established in the context
of supply chain management (SCM) as the flow of activities infers that an extent of integration
between activities needs to exist. Supply chain is explained by Jain et al (2010) as the
management of business processes or activities
associated with coordination and there are linkages in the supply chain network. The networks
comprise of multiple firms of different forms, sizes and types of products that are manufactured
and distributed.
The functions of these networks are to transform raw materials into finished products and to
move the
finished products to the end users through efficient and effective SCM. Due to today’s crowded
market
place, efficient SCM is the focal point on building sustainable competitive edge as seen by the
responsiveness of the supply chain (Aitken, Christopher & Towill, 2002).
Most companies today no longer compete simply as independent businesses but rather as supply
chains. This is in line with Mentzer’s et al (2001) and Esper’s et al (2010) explanation of supply
chains as all companies are involved in the upstream and downstream flows of products,
services, finances and information. Individual businesses no longer operate in isolation and
neither should their strategic orientation be wholly individualistic. Lambert (2004) emphasizes
the need to have in-depth knowledge and understanding of how the supply chain network
structure is configured. The three primary.
components of a company’s network structure are:

5
i. The members of the supply chain
ii. The structural dimensions of the network
iii. The different types of process links across supply chain
This clearly shows the importance of integration as logistics being part of the activities within
supply
chain will influence the overall effectiveness of the supply chain. This concurs with several
literatures
which have identified logistics as long term and voluntary relationships between two or more
independent members of the supply chain (Cruijessen et al, 2007; Schmoltzi & Wallenburg,
2012). The importance of
supply chain integration is well established according to Balcik et al, (2010), Maon et al, (2009)
and van Wassenhove, (2006) especially when linking the idea of humanitarian logistics for the
better achievement of goals. Indee d, better collaboration and coordination of members within
the greater supply chain network may well lead to a more robust SCM. However, the presence of
integration from a practical perspective is still questionable as members within the chain may
find it difficult to expressly execute specific functions due to the complexities of integration.
Zurita (2017) explains the lack of integration among food processing companies in Malaysia and
this translates to the difficulties of integration. This paper however, establishes that despite the
complexities, integration is still an essential component in SCM.

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 NEED FOR THE STUDY
This study is taken up to fulfill the requirement the Project is undertaken during Jan
2019 to Feb 2019 and the main purpose of the Project is to know the application of the
theoretical aspects in our course in the corporate environment and gain firsthand experience and
expose ourselves to corporate policies, ethics, culture, practices, procedures, facts about the
work collate and policies of the company.

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 OBJECTIVES OF THE STUDY

 To study supply chain management at ULTRATECH.

 To study production process at ULTRATECH.
 To study distribution network of ULTRATECH.
 To focus on product distribution process.
 To study transport management system.

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 1.1 SCOPE OF THE STUDY

 This report is based on the study conducted at ULTRATECH, HYDERABAD..

 It aims at understanding the company's establishment. Organization structure, departments,
techniques, marketing strategies and the advantages it is having over the competitors.
 An attempt is made to analyze the company's performance in comparison to the theoretical
aspects.
 It aims to understand the skills of the company in the areas like technological
advancements, competition and in management.
 Study of logistics and distribution of marketing
 Knowing how logistics is done in ULTRATECH

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 1.2 LIMITATION OF THE STUDY

· This study throws light on supply chain management process commenced at the
ULTRATECH ltd. HYDERABAD..
· The disadvantage of study SCM is investment of time, money and resources
needed to implement and overlook supply chain.
· HYDERABAD. ice cream has no homepage.
· Convenience sampling used here has its own limitations.
· There have been some inaccuracies due to non – cooperative and rude behavior
of the respondents.

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 METHODOLOGY ADOPTED FOR THE STUDY

OBSERVATIONAL METHOD
Observation were made in the ULTRATECH store regarding the customer groups present
there, retail formats adopted by the store, various verticals inside the store for each category of
product, ambience, services provided to buyers and discount techniques
 Observing the working of various departments like finance safety, human resource
production, purchasing etc.
 Discussion with the company executives, managers and employees
 Visiting and surfing websites of the company.
Survey Method

Personal meeting with manager and assistants. Questionnaire was prepared for the staff at
ULTRATECH, which included several open-ended and close-ended questions aimed at knowing
the following

 Why ULTRATECH
 Loyalty level
 Effect of logistics

1.3 Sources of Data

 Primary data
 Secondary data
1.7(a) Primary Data
The data collected for the first time through observation and interview method. The data is
collected by observing the working of various departments and also by interviewing the managers
of all the departments. It is also obtained by the help of staff members.
1.7(b) Secondary Data
The data is collected by secondary sources also. The data is collected through company
manual, product brochure, company website and annual report.

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 CHAPTER-3

INDUSTRY PROFILE

COMPANY PROFILE

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 INDUSTRY PROFILE

The Indian cement industry is directly related to the country's infrastructure sector and thus
its growth is paramount in determining the development of the country. With a current
production capacity of around 366 million tonnes (MT), India is the second largest producer of
cement in the world and fueled by growth in the infrastructure sector, the capacity is expected to
increase to around 550 MT by FY20.
India has a lot of potential for development in the infrastructure and construction sector and the
cement sector is expected to largely benefit from it. Some of the recent major government
initiatives such as development of 100 smart cities are expected to provide a major boost to the
sector.
Expecting such developments in the country and aided by suitable government foreign policies,
several foreign players such as the likes of Lafarge, Holcim and Vicat have invested in the
country in the recent past. Another factor which aids the growth of this sector is the ready
availability of the raw materials for making cement, such as limestone and coal.
Market Size
According to data released by the Department of Industrial Policy and Promotion (DIPP), cement
and gypsum products attracted foreign direct investment (FDI) worth US$ 2,984.29 million
between April 2000 and September 2014.
In India, the housing sector is the biggest demand driver of cement, accounting for about 67 per
cent of the total consumption. The other major consumers of cement include infrastructure at 13
per cent, commercial construction at 11 per cent and industrial construction at nine per cent.
To meet the rise in demand, cement companies are expected to add 56 MT capacity over the next
three years. The cement capacity in India may register a growth of eight per cent by next year
end to 395 MT from the current level of 366 MT. It may increase further to 421 MT by the end
of 2017. The country's per capita consumption stands at around 190 kg.
A total of 188 large cement plants together account for 97 per cent of the total installed capacity
in the country, while 365 small plants account for the rest. Of these large cement plants, 77 are
located in the states of Andhra Pradesh, Rajasthan and Tamil Nadu. The Indian cement industry
is dominated by a few companies. The top 20 cement companies account for almost 70 per cent
of the total cement production of the country.

13
Investments
On the back of growing demands, due to increased construction and infrastructural activities, the
cement sector in India has seen many investments and developments in recent times. Some of
them are as follows:
 Lafarge and Holcim plans to request for the European Commission's approval for their
possible merger. The two companies had earlier unveiled plans in April 2014 to create the
world's biggest cement group with US$ 44 billion in yearly sales.
 JSW cement plans to enter the Kerala market to cash in on the construction frenzy in the
state. JSW is presently building a three million tonnes per annum (MTPA) capacity plant at
Chitrapur in Karnataka to add to the current 5.4 MTPA capacity in South India.
 Zuari Cement through its subsidiary Gulbarga Cement Limited (GCL) plans to set up a 3.23
MT cement plant in Gulbarga, Karnataka. The company along with the cement plant is
setting up a 50 MW captive power plant in the region.
 Malabar Cements plans to set up an automated cement handling and bagging unit as well as
raw materials import facility in the Kochi port. Malabar Cements has projected a minimum
throughput of 300,000 tonnes per annum which can be extendable up to 600,000 tonnes per
annum, apart from intermediate products and raw materials such as clinker, limestone and
coal.
 Reliance Cement Company (RCC), a subsidiary of Reliance Infrastructure, has entered into
the cement market of Bihar where the demand for the building material is on the rise due to a
realty boom. RCC presently has plants with total installed capacity of 5.8 MTPA.
Government Initiatives
In the 12th FiveYear Plan, the government plans to increase investment in infrastructure to the
tune of US$ 1 trillion and increase the industry's capacity to 150 MT.
The Cement Corporation of India (CCI) was incorporated by the Government of India in 1965 to
achieve self-sufficiency in cement production in the country. Currently, CCI has 10 units spread
over eight states in India.
In order to help the private sector companies thrive in the industry, the government has been
approving their investment schemes. Some such initiatives by the government in the recent past
are as follows:

14
  The Andhra Pradesh State Investment Promotion Board (SIPB) has approved proposals
worth Rs 9,200 crore (US$ 1.48 billion) including three cement plants and concessions to
Hero MotoCorp project. The total capacity of these three cement plants is likely to be
about 12 MT per annum and the plants are expected to generate employment for nearly
4,000 people directly and a few thousands more indirectly.
 India has joined hands with Switzerland to reduce energy consumption and develop
newer methods in the country for more efficient cement production, which will help India
meet its rising demand for cement in the infrastructure sector.
 The Government of India has decided to adopt cement instead of bitumen for the
construction of all new road projects on the grounds that cement is more durable and
cheaper to maintain than bitumen in the long run.
Road Ahead
With the Government of India providing a boost to the infrastructure and various housing
projects coming up in urban as well as rural areas, the cement sector has enough scope for
development in the future.

Market Size

The Indian cement sector is expected to witness positive growth in the coming years, with
demand set to increase at a CAGR of more than 8 per cent in the period FY 2013-14 to FY 2015-
16, according to the latest report titled ‘Indian Cement Industry Outlook 2016’ by market
research consulting firm RNCOS. The report further observed that India’s southern region is
creating the maximum demand for cement, which is expected to increase more in future.

The cement and gypsum products sector has attracted foreign direct investments (FDI) worth
US$ 2,656.29 million in the period April 2000–August 2013, according to data published by the
Department of Industrial Policy and Promotion (DIPP).

Investments

 Prism Cement Ltd has become the first Indian company to get the Quality Council of India's
(QCI) certification for its ready-mix concrete (RMC) plant in Kochi, Kerala. The company

15
 received the certification from Institute for Certification and Quality Mark (ICQM), a leading
Italian certification body authorised to oversee QCI compliance.
 UltraTech Cement, an Aditya Birla Group Company, has acquired the 4.8 million tonne per
annum (MTPA) Gujarat unit of Jaypee Cement Corp for Rs 3,800 crore (US$ 595.61
million).
 ACC Ltd plans to invest Rs 3,000 crore (US$ 470.22 million) to expand its capacity by
nearly 4 MT a year in three eastern region states, over the next three years.
 Reliance Cements Co Pvt Ltd will set up a 3 MTPA grinding unit at an estimated cost of Rs
600 crore (US$ 94.04 million). The unit is likely to come up at Raghunathpur in Purulia,
West Bengal.
 Reliance Cement Co, a special purpose vehicle (SPV) of Reliance Infrastructure Ltd, is
commissioning its first 5 MTPA plant in Madhya Pradesh. The project has been implemented
at a cost of approximately Rs 3,000 crore (US$ 470.22 million).
 Zuari Cement plans to set up a cement grinding unit at Auj (Aherwadi) and Shingadgaon
villages in Solapur, Maharashtra. The new unit will have a production capacity of 1 MTPA
and is expected to be operational by the second quarter of 2015.
 JSW Steel has acquired Heidelberg Cement India's 0.6 MTPA cement grinding facility in
Raigad, Maharashtra, for an undisclosed amount.

Government Initiatives

Giving impetus to the market, the Indian government plans to roll out public-private partnership
(PPP) projects worth Rs 1 trillion (US$ 15.67 billion) over the next six months. The Principal
Secretary in the Prime Minister's Office (PMO) will monitor these projects.

Also, the steering group appointed by Dr Manmohan Singh, Prime Minister of India, to
accelerate infrastructure investments, has set deadlines for the awarding of projects such as
Mumbai rail corridor and Navi Mumbai Airport, among others.

The Goa State Pollution Control Board (GSPCB) has signed a memorandum of understanding
(MoU) with Vasavdatta Cement, a company with its plant in Karnataka. The firm would use the

16
plastic waste collected by the state agencies and village panchayats from Goa as fuel for its
manufacturing plant.

Road Ahead

The globally-competitive cement industry in India continues to witness positive trends such as
cost control, continuous technology upgradation and increased construction activities.

Furthermore, major cement manufacturers in India are progressively using other alternatives
such as bioenergy as fuel for their kilns. This is not only helping to bring down production costs
of cement companies, but is also proving effective in reducing emissions.

With the ever-increasing industrial activities, real estate, construction and infrastructure, in
addition to the various Special Economic Zones (SEZs) being developed across the country,
there is a demand for cement.

It is estimated that the country requires about US$ 1 trillion in the period FY 2012-13 to FY
2016-17 to fund infrastructure such as ports, airports and highways to boost growth, which
promises a good scope for the cement industry.

The 4th Annual India Cement Sector Business Sentiment Survey is nearly out and the India
Construction & Building Materials Journal provides the opportunity of an exclusive look at the
survey’s results before their sharing with the wider audiences. We are glad to be able to present
here some of the survey highlights and provide our readers with before-hand data regarding the
views and expectations of cement industry professionals.

Optimism continues to be the name of the game for the Indian cement industry – a function of
long-term trends as well as human nature. But on a closer look, the survey shows that the
optimism only runs skin deep and that it has already been eroded by an increasing percentage of
industry members who feel dissatisfied with the overall performance of the field last year.

For instance, the percentage of those who believe the industry performed “well” dropped from
43 percent in 2012 to 26 percent in 2013, while the number of respondents who believe the
industry performed poorly almost tripled from 8 percent last year to 22 percent in 2013.

17
Regarding the future evolution of the industry, survey participants continue to be on the
optimistic side and hope for a “somewhat better” or “much better” performance compared to the
last 6 months.

China tackles pollution and overcapacity

2013 has been the year that China's central planners took action against cement production
overcapacity and pollution. Consolidation plans for the industry followed falling profits for
cement producers in 2012. However, record air pollution levels in Beijing in early 2013 shut the
city down, raised public awareness and gave the government a strong lever to encourage further
industry consolidation through environmental controls. By the middle of year profits of major
producers were up but production was also up. Finally in December 2013, China started to
launch its emissions trading schemes (ETS), led by Guangdong province, to create what will be
the second largest carbon market in the world after the EU ETS.

India faces a sticky wicket

Meanwhile, the world's second largest cement producing country has faced poor profits and
growth for cement producers blamed on paltry demand, piddling prices and proliferating
production costs. Compounding that, the Indian Rupee fell to a historic low relative to the US
Dollar in mid-2013, further putting pressure on input costs. Holcim reacted to all of this by
releasing plans to simplify its presence in the country between Holcim India, Ambuja and ACC.

Sub-Saharan Africa draws up the battle lines

Competition in sub-Saharan Africa is set to intensify when Nigeria's Dangote Cement opens its
first cement plant in South Africa in early 2014. It is the first time Africa's two largest cement
producers, Dangote and South Africa's PPC, will produce cement in the same country. Future
clashes will follow across the region as each producer increasingly advances toward the other.

The Kingdom needs cement... and workers

Saudi Arabian infrastructure demands have created all sorts of reverberations across the Middle
Eastern cement industry and beyond as the nation pushes on to build its six 'economic' cities

18
amongst other projects. Back in April 2013 King Abdullah bin Abdulaziz Al Saud of Saudi
Arabia issued an edict ordering the import of 10Mt of cement. Then some producers started to
report production line shutdowns in the autumn of 2013 as they buckled under the pressure,
although they consoled themselves with solid profit rises. Now, cement sales have fallen
following a government crackdown on migrant workers that has hit the construction sector.

Competition concerns in Europe

Europe may be slowly emerging from the economic gloom but anti-trust regulators have
remained vigilant. An asset swap between Cemex and Holcim over units in the Czech Republic,
Germany and Spain has received attention from the European Commission. In the UK the
Competition Commission has decreed that further action is required for the cement sector
following the creation of new player Hope Construction Materials in 2012. Lafarge Tarmac may
now have to sell another one of its UK cement plants to increase more competition into the
market. Elsewhere in Europe, Belgium regulators took action in September 2013 and this week
we report on Polish action against cartel-like activity.

Don't forget South-East Asia, Brazil or Russia!

Growth continues to dominate these regions and major sporting tournaments are on the way in
Brazil and Russia, further adding to local cement demand. Votorantim may have cancelled its
US$4.8bn initial public offering in August 2013 but it is still has the highest cement production
capacity in Brazil. Finally, Indonesia may not have had any 'marquee' style story to sum up 2013
but it continues to regularly announce cement plant builds. In July 2013 the Indonesian Cement
Association announced that cement sales growth had fallen to 'just' 7.5% for the first half of
2013.

In the most general sense of the word, a cement is a binder, a substance which sets and
hardens independently, and can bind other materials together. The word "cement" traces to the
Romans, who used the term "opus caementicium" to describe masonry which resembled concrete
and was made from crushed rock with burnt lime as binder. The volcanic ash and pulverized
brick additives which were added to the burnt lime to obtain a hydraulic binder were later
referred to as cementum, cimentum, cäment and cement. Cements used in construction are

19
characterized as hydraulic or non-hydraulic.
The most important use of cement is the production of mortar and concrete—the bonding of
natural or artificial aggregates to form a strong building material which is durable in the face of
normal environmental effects.
Concrete should not be confused with cement because the term cement refers only to the dry
powder substance used to bind the aggregate materials of concrete. Upon the addition of water
and/or additives the cement mixture is referred to as concrete, especially if aggregates have been
added.
It is uncertain where it was first discovered that a combination of hydrated non-hydraulic lime
and a pozzolan produces a hydraulic mixture (see also: Pozzolanic reaction), but concrete made
from such mixtures was first used on a large scale by Roman engineers.They used both natural
pozzolans (trass or pumice) and artificial pozzolans (ground brick or pottery) in these concretes.
Many excellent examples of structures made from these concretes are still standing, notably the
huge monolithic dome of the Pantheon in Rome and the massive Baths of Caracalla. The vast
system of Roman aqueducts also made extensive use of hydraulic cement. The use of structural
concrete disappeared in medieval Europe, although weak pozzolanic concretes continued to be
used as a core fill in stone walls and columns.
Modern cement
Modern hydraulic cements began to be developed from the start of the Industrial Revolution
(around 1800), driven by three main needs:
Hydraulic renders for finishing brick buildings in wet climates
Hydraulic mortars for masonry construction of harbor works etc, in contact with sea water.
Development of strong concretes.
In Britain particularly, good quality building stone became ever more expensive during a period
of rapid growth, and it became a common practice to construct prestige buildings from the new
industrial bricks, and to finish them with a stucco to imitate stone. Hydraulic limes were favored
for this, but the need for a fast set time encouraged the development of new cements. Most
famous was Parker's "Roman cement." This was developed by James Parker in the 1780s, and
finally patented in 1796. It was, in fact, nothing like any material used by the Romans, but was a
"Natural cement" made by burning septaria - nodules that are found in certain clay deposits, and
that contain both clay minerals and calcium carbonate. The burnt nodules were ground to a fine

20
powder. This product, made into a mortar with sand, set in 5–15 minutes. The success of
"Roman Cement" led other manufacturers to develop rival products by burning artificial
mixtures of clay and chalk.
John Smeaton made an important contribution to the development of cements when he was
planning the construction of the third Eddystone Lighthouse (1755-9) in the English Channel. He
needed a hydraulic mortar that would set and develop some strength in the twelve hour period
between successive high tides. He performed an exhaustive market research on the available
hydraulic limes, visiting their production sites, and noted that the "hydraulicity" of the lime was
directly related to the clay content of the limestone from which it was made. Smeaton was a civil
engineer by profession, and took the idea no further. Apparently unaware of Smeaton's work, the
same principle was identified by Louis Vicat in the first decade of the nineteenth century. Vicat
went on to devise a method of combining chalk and clay into an intimate mixture, and, burning
this, produced an "artificial cement" in 1817. James Frost,orking in Britain, produced what he
called "British cement" in a similar manner around the same time, but did not obtain a patent
until 1822. In 1824, Joseph Aspdin patented a similar material, which he called Portland cement,
because the render made from it was in color similar to the prestigious Portland stone.
All the above products could not compete with lime/pozzolan concretes because of fast-setting
(giving insufficient time for placement) and low early strengths (requiring a delay of many
weeks before formwork could be removed). Hydraulic limes, "natural" cements and "artificial"
cements all rely upon their belite content for strength development. Belite develops strength
slowly. Because they were burned at temperatures below 1250 °C, they contained no alite, which
is responsible for early strength in modern cements. The first cement to consistently contain alite
was made by Joseph Aspdin's son William in the early 1840s. This was what we call today
"modern" Portland cement. Because of the air of mystery with which William Aspdin
surrounded his product, others (e.g. Vicat and I C Johnson) have claimed precedence in this
invention, but recent analysis of both his concrete and raw cement have shown that William
Aspdin's product made at Northfleet, Kent was a true alite-based cement. However, Aspdin's
methods were "rule-of-thumb": Vicat is responsible for establishing the chemical basis of these
cements, and Johnson established the importance of sintering the mix in the kiln.
William Aspdin's innovation was counter-intuitive for manufacturers of "artificial cements",
because they required more lime in the mix (a problem for his father), because they required a

21
much higher kiln temperature (and therefore more fuel) and because the resulting clinker was
very hard and rapidly wore down the millstones which were the only available grinding
technology of the time. Manufacturing costs were therefore considerably higher, but the product
set reasonably slowly and developed strength quickly, thus opening up a market for use in
concrete. The use of concrete in construction grew rapidly from 1850 onwards, and was soon the
dominant use for cements. Thus Portland cement began its predominant role. it is made from
water and sand

Types of modern cement

Portland cement
Cement is made by heating limestone (calcium carbonate), with small quantities of other
materials (such as clay) to 1450°C in a kiln, in a process known as calcination, whereby a
molecule of carbon dioxide is liberated from the calcium carbonate to form calcium oxide, or
lime, which is then blended with the other materials that have been included in the mix . The
resulting hard substance, called 'clinker', is then ground with a small amount of gypsum into a
powder to make 'Ordinary Portland Cement', the most commonly used type of cement (often
referred to as OPC).
Portland cement is a basic ingredient of concrete, mortar and most non-speciality grout. The
most common use for Portland cement is in the production of concrete. Concrete is a composite
material consisting of aggregate (gravel and sand), cement, and water. As a construction
material, concrete can be cast in almost any shape desired, and once hardened, can become a
structural (load bearing) element. Portland cement may be gray or white.
Portland cement blends
These are often available as inter-ground mixtures from cement manufacturers, but similar
formulations are often also mixed from the ground components at the concrete mixing plant.
Portland blastfurnace cement contains up to 70% ground granulated blast furnace slag, with
the rest Portland clinker and a little gypsum. All compositions produce high ultimate strength,
but as slag content is increased, early strength is reduced, while sulfate resistance increases and
heat evolution diminishes. Used as an economic alternative to Portland sulfate-resisting and low-
heat cements.
Portland flyash cement contains up to 30% fly ash. The fly ash is pozzolanic, so that ultimate

22
strength is maintained. Because fly ash addition allows a lower concrete water content, early
strength can also be maintained. Where good quality cheap fly ash is available, this can be an
economic alternative to ordinary Portland cement.
Portland pozzolan cement includes fly ash cement, since fly ash is a pozzolan, but also includes
cements made from other natural or artificial pozzolans. In countries where volcanic ashes are
available (e.g. Italy, Chile, Mexico, the Philippines) these cements are often the most common
form in use.
Portland silica fume cement. Addition of silica fume can yield exceptionally high strengths,
and cements containing 5-20% silica fume are occasionally produced. However, silica fume is
more usually added to Portland cement at the concrete mixer.
Masonry cements are used for preparing bricklaying mortars and stuccos, and must not be used
in concrete. They are usually complex proprietary formulations containing Portland clinker and a
number of other ingredients that may include limestone, hydrated lime, air entrainers, retarders,
waterproofers and coloring agents. They are formulated to yield workable mortars that allow
rapid and consistent masonry work. Subtle variations of Masonry cement in the US are Plastic
Cements and Stucco Cements. These are designed to produce controlled bond with masonry
blocks.
Expansive cements contain, in addition to Portland clinker, expansive clinkers (usually
sulfoaluminate clinkers), and are designed to offset the effects of drying shrinkage that is
normally encountered with hydraulic cements. This allows large floor slabs (up to 60 m square)
to be prepared without contraction joints.
White blended cements may be made using white clinker and white supplementary materials
such as high-purity metakaolin.
Colored cements are used for decorative purposes. In some standards, the addition of pigments
to produce "colored Portland cement" is allowed. In other standards (e.g. ASTM), pigments are
not allowed constituents of Portland cement, and colored cements are sold as "blended hydraulic
cements".
Very finely ground cements are made from mixtures of cement with sand or with slag or other
pozzolan type minerals which are extremely finely ground together. Such cements can have the
same physical characteristics as normal cement but with 50% less cement particularly due to
their increased surface area for the chemical reaction. Even with intensive grinding they can use

23
up to 50% less energy to fabricate than ordinary Portland cements.
Non-Portland hydraulic cements
Pozzolan-lime cements. Mixtures of ground pozzolan and lime are the cements used by the
Romans, and are to be found in Roman structures still standing (e.g. the Pantheon in Rome).
They develop strength slowly, but their ultimate strength can be very high. The hydration
products that produce strength are essentially the same as those produced by Portland cement.
Slag-lime cements. Ground granulated blast furnace slag is not hydraulic on its own, but is
"activated" by addition of alkalis, most economically using lime. They are similar to pozzolan
lime cements in their properties. Only granulated slag (i.e. water-quenched, glassy slag) is
effective as a cement component.
Supersulfated cements. These contain about 80% ground granulated blast furnace slag, 15%
gypsum or anhydrite and a little Portland clinker or lime as an activator. They produce strength
by formation of ettringite, with strength growth similar to a slow Portland cement. They exhibit
good resistance to aggressive agents, including sulfate.
Calcium aluminate cements are hydraulic cements made primarily from limestone and bauxite.
The active ingredients are monocalcium aluminate CaAl2O4 (CaO · Al2O3 or CA in Cement
chemist notation, CCN) and mayenite Ca12Al14O33 (12 CaO · 7 Al2O3 , or C12A7 in CCN).
Strength forms by hydration to calcium aluminate hydrates. They are well-adapted for use in
refractory (high-temperature resistant) concretes, e.g. for furnace linings.
Calcium sulfoaluminate cements are made from clinkers that include ye'elimite

(Ca4(AlO2)6SO4 or C4A3 in Cement chemist's notation) as a primary phase. They are used in
expansive cements, in ultra-high early strength cements, and in "low-energy" cements. Hydration
produces ettringite, and specialized physical properties (such as expansion or rapid reaction) are
obtained by adjustment of the availability of calcium and sulfate ions. Their use as a low-energy
alternative to Portland cement has been pioneered in China, where several million tonnes per
year are produced. Energy requirements are lower because of the lower kiln temperatures
required for reaction, and the lower amount of limestone (which must be endothermically
decarbonated) in the mix. In addition, the lower limestone content and lower fuel consumption
leads to a CO2 emission around half that associated with Portland clinker. However, SO2
emissions are usually significantly higher.
"Natural" Cements correspond to certain cements of the pre-Portland era, produced by burning

24
argillaceous limestones at moderate temperatures. The level of clay components in the limestone
(around 30-35%) is such that large amounts of belite (the low-early strength, high-late strength
mineral in Portland cement) are formed without the formation of excessive amounts of free lime.
As with any natural material, such cements have highly variable properties.
Geopolymer cements are made from mixtures of water-soluble alkali metal silicates and
aluminosilicate mineral powders such as fly ash and metakaolin.

25
 COMPANY PROFILE
ULTRATECH CEMENT:
UltraTech Cement Limited has an annual capacity of 18.2 million tonnes. It manufactures and
markets Ordinary Portland Cement, Portland Blast Furnace Slag Cement and Portland Pozzalana
Cement. It also manufactures ready mix concrete (RMC).

UltraTech Cement Limited has five integrated plants, six grinding units and three terminals —
two in India and one in Sri Lanka.

UltraTech Cement is the country’s largest exporter of cement clinker. The export markets span
countries around the Indian Ocean, Africa, Europe and the Middle East.
UltraTech’s subsidiaries are Dakshin Cement Limited and UltraTech Ceylinco (P) Limited.

The roots of the Aditya Birla Group date back to the 19th century in the picturesque town of
Pilani, set amidst the Rajasthan desert. It was here that Seth Shiv Narayan Birla started trading in
cotton, laying the foundation for the House of Birlas.

Through India's arduous times of the 1850s, the Birla business expanded rapidly. In the early part
of the 20th century, our Group's founding father, Ghanshyamdas Birla, set up industries in
critical sectors such as textiles and fibre, aluminium, cement and chemicals. As a close
confidante of Mahatma Gandhi, he played an active role in the Indian freedom struggle. He
represented India at the first and second round-table conference in London, along with Gandhiji.
It was at "Birla House" in Delhi that the luminaries of the Indian freedom struggle often met to
plot the downfall of the British Raj.

Ghanshyamdas Birla found no contradiction in pursuing business goals with the dedication of a
saint, emerging as one of the foremost industrialists of pre-independence India. The principles by
which he lived were soaked up by his grandson, Aditya Vikram Birla, our Group's legendary
leader.

26
FACT FILE

 Largest producer of grey cement, white cement and ready-mix concrete in India.
 Largest producer of white cement in India.
 Installed capacity of 62 MTPA.
 Presence with 12 integrated plants, 1 white cement plant, 2 WallCare putty plants, 1
clinkerisation plant in UAE, 16 grinding units; 12 in India, 2 in UAE, 1 in Bahrain and
Bangladesh each, 6 bulk terminals; 5 in India and 1 in Sri Lanka and 101 Concrete plants.
 Straddling export markets in countries across the Indian Ocean and the Middle East.

Aditya Vikram Birla: putting India on the world map

A formidable force in Indian industry, Mr. Aditya Birla dared to dream of setting up a global
business empire at the age of 24. He was the first to put Indian business on the world map, as far
back as 1969, long before globalisation became a buzzword in India.

In the then vibrant and free market South East Asian countries, he ventured to set up world-class
production bases. He had foreseen the winds of change and staked the future of his business on a
competitive, free market driven economy order. He put Indian business on the globe, 22 years
before economic liberalisation was formally introduced by the former Prime Minister, Mr.
Narasimha Rao and the former Union Finance Minister, Dr. Manmohan Singh. He set up 19
companies outside India, in Thailand, Malaysia, Indonesia, the Philippines and Egypt.

Interestingly, for Mr. Aditya Birla, globalisation meant more than just geographic reach. He
believed that a business could be global even whilst being based in India. Therefore, back in his
home-territory, he drove single-mindedly to put together the building blocks to make our Indian
business a global force.

Under his stewardship, his companies rose to be the world's largest producer of viscose staple
fibre, the largest refiner of palm oil, the third largest producer of insulators and the sixth largest
producer of carbon black. In India, they attained the status of the largest single producer of

27
viscose filament yarn, apart from being a producer of cement, grey cement and rayon grade pulp.
The Group is also the largest producer of aluminium in the private sector, the lowest first cost
producers in the world and the only producer of linen in the textile industry in India.

At the time of his untimely demise, the Group's revenues crossed Rs.8,000 crore globally, with
assets of over Rs.9,000 crore, comprising of 55 benchmark quality plants, an employee strength
of 75,000 and a shareholder community of 600,000.

Most importantly, his companies earned respect and admiration of the people, as one of India's
finest business houses, and the first Indian International Group globally. Through this
outstanding record of enterprise, he helped create enormous wealth for the nation, and respect for
Indian entrepreneurship in South East Asia. In his time, his success was unmatched by any other
industrialist in India.

That India attains respectable rank among the developed nations, was a dream he forever
cherished. He was proud of India and took equal pride in being an Indian.

Under the leadership of our Chairman, Mr. Kumar Mangalam Birla, the Group has sustained and
established a leadership position in its key businesses through continuous value-creation.
Spearheaded by Grasim, Hindalco, Aditya Birla Nuvo, Indo Gulf Fertilisers and companies in
Thailand, Malaysia, Indonesia, the Philippines and Egypt, the Aditya Birla Group is a leader in a
swathe of products — viscose staple fibre, aluminium, cement, copper, carbon black, palm oil,
insulators, garments. And with successful forays into financial services, telecom, software and
BPO, the Group is today one of Asia's most diversified business groups.

Board of Directors
:: Mr. Kumar Mangalam Birla, Chairman

:: Mrs. Rajashree Birla

:: Mr. R. C. Bhargava

:: Mr. G. M. Dave

:: Mr. N. J. Jhaveri

28
:: Mr. S. B. Mathur

:: Mr. V. T. Moorthy

:: Mr. O. P. Puranmalka

:: Mr. S. Rajgopal

:: Mr. D. D. Rathi

:: Mr. S. Misra, Managing Director

Executive President & Chief Financial Officer

:: Mr. K. C. Birla

Chief Manufacturing Officer

:: R.K. Shah

Chief Marketing Officer

:: Mr. O. P. Puranmalka

Company Secretary
:: Mr. S. K. Chatterjee

Our vision

"To actively contribute to the social and economic development of the communities in
which we operate. In so doing, build a better, sustainable way of life for the weaker sections
of society and raise the country's human development index."

— Mrs. Rajashree Birla, Chairperson,

The Aditya Birla Centre for Community Initiatives and Rural Development

Awards won

29
 Year Award

IMC Ramkrishna Bajaj National Quality Award

2013-2014

Asociated with Govrmnent projects & Business World FICCI-SEDF CSR

2012-2013
Award

ASSOCHAM CSR Excellence Award for its "truly outstanding" CSR

2011-2012
activities

2010-2011 Subh Karan Sarawagi Environment Award

2010-2011 Business World FICCI-SEDF CSR Award

2010 Greentech Environment Excellence Gold Award

2010 IMC Ramkrishna Bajaj National Quality Award

2010 Asian CSR Award

2009-2010 National Award for Prevention of Pollution

2009-2010 Rajiv Gandhi Environment Award for Clean Technology

2009-2010 State Level Environment Award (Plant)

Making a difference
Before Corporate Social Responsibility found a place in corporate lexion, it was already textured
into our Group's value systems. As early as the 1940s, our founding father Shri G.D Birla
espoused the trusteeship concept of management. Simply stated, this entails that the wealth that
one generates and holds is to be held as in a trust for our multiple stakeholders. With regard to
CSR, this means investing part of our profits beyond business, for the larger good of society.

While carrying forward this philosophy, his grandson, Aditya Birla weaved in the concept of
'sustainable livelihood', which transcended cheque book philanthropy. In his view, it was unwise
to keep on giving endlessly. Instead, he felt that channelising resources to ensure that people
have the wherewithal to make both ends meet would be more productive. He would say, "Give a
hungry man fish for a day, he will eat it and the next day, he would be hungry again. Instead if
you taught him how to fish, he would be able to feed himself and his family for a lifetime."

30
Taking these practices forward, our chairman

Mr. Kumar Mangalam Birla institutionalised the concept of triple bottom line accountability
represented by economic success, environmental responsibility and social commitment. In a
holistic way thus, the interests of all the stakeholders have been textured into our Group's fabric.

The footprint of our social work today straddles over 3,700 villages, reaching out to more than 7
million people annually. Our community work is a way of telling the people among whom we
operate that We Care.

Our strategy
Our projects are carried out under the aegis of the "Aditya Birla Centre for Community
Initiatives and Rural Development", led by Mrs. Rajashree Birla. The Centre provides the
strategic direction, and the thrust areas for our work ensuring performance management as well.
Our focus is on the all-round development of the communities around our plants located mostly
in distant rural areas and tribal belts. All our Group companies —- Grasim, Hindalco, Aditya
Birla Nuvo, Indo Gulf and UltraTech have Rural Development Cells which are the
implementation bodies.

Projects are planned after a participatory need assessment of the communities around the plants.
Each project has a one-year and a three-year rolling plan, with milestones and measurable
targets. The objective is to phase out our presence over a period of time and hand over the reins
of further development to the people. This also enables us to widen our reach. Along with
internal performance assessment mechanisms, our projects are audited by reputed external
agencies, who measure it on qualitative and quantitative parameters, helping us gauge the
effectiveness and providing excellent inputs.

Our partners in development are government bodies, district authorities, village panchayats and
the end beneficiaries -- the villagers. The Government has, in their 5-year plans, special funds
earmarked for human development and we recourse to many of these. At the same time, we
network and collaborate with like-minded bilateral and unilateral agencies to share ideas, draw
from each other's experiences, and ensure that efforts are not duplicated. At another level, this
provides a platform for advocacy. Some of the agencies we have collaborated with are UNFPA,

31
SIFSA, CARE India, Habitat for Humanity International, Unicef and the World Bank.

Our focus areas

Our rural development activities span five key areas and our single-minded goal here is to help
build model villages that can stand on their own feet. Our focus areas are healthcare, education,
sustainable livelihood, infrastructure and espousing social causes.

The name “Aditya Birla” evokes all that is positive in business and in life. It exemplifies
integrity, quality, performance, perfection and above all character.

Our logo is the symbolic reflection of these traits. It is the cornerstone

of our corporate identity. It helps us leverage the unique Aditya Birla
brand and endows us with a distinctive visual image.

Depicted in vibrant, earthy colours, it is very arresting and shows the sun rising over two circles.
An inner circle symbolising the internal universe of the Aditya Birla Group, an outer circle
symbolising the external universe, and a dynamic meeting of rays converging and diverging
between the two.

Through its wide usage, we create a consistent, impact-oriented Group image. This undoubtedly
enhances our profile among our internal and external stakeholders.

Our corporate logo thus serves as an umbrella for our Group. It signals the common values and
beliefs that guide our behaviour in all our entrepreneurial activities. It embeds a sense of pride,
unity and belonging in all of our 130,000 colleagues spanning 25 countries and 30 nationalities
across the globe. Our logo is our best calling card that opens the gateway to the world.

Group companies
:: Grasim Industries Ltd.
:: Hindalco Industries Ltd.

32
:: Aditya Birla Nuvo Ltd.
:: UltraTech Cement Ltd.

Indian companies
:: Aditya Birla Minacs IT Services Ltd.
:: Aditya Birla Minacs Worldwide Limited
:: Essel Mining & Industries Ltd
:: Idea Cellular Ltd.
:: Aditya Birla Insulators
:: Aditya Birla Retail Limited
:: Aditya Birla Chemicals (India) Limited

International companies
Thailand
:: Thai Rayon
:: Indo Thai Synthetics
:: Thai Acrylic Fibre
:: Thai Carbon Black
:: Aditya Birla Chemicals (Thailand) Ltd.
:: Thai Peroxide
Philippines
:: Indo Phil Group of companies
:: Pan Century Surfactants Inc.
Indonesia
:: PT Indo Bharat Rayon
:: PT Elegant Textile Industry
:: PT Sunrise Bumi Textiles
:: PT Indo Liberty Textiles

33
:: PT Indo Raya Kimia
Egypt
:: Alexandria Carbon Black Company S.A.E
:: Alexandria Fiber Company S.A.E
China
:: Liaoning Birla Carbon
:: Birla Jingwei Fibres Company Limited
:: Aditya Birla Grasun Chemicals (Fangchenggang) Ltd.
Canada
:: A.V. Group
Australia
:: Aditya Birla Minerals Ltd.
Laos
:: Birla Laos Pulp & Plantations Company Limited
North and South America, Europe and Asia
:: Novelis Inc.
Singapore
:: Swiss Singapore Overseas Enterprises Pte Ltd. (SSOE)
Joint ventures
:: Birla Sun Life Insurance Company
:: Birla Sun Life Asset Management Company
:: Aditya Birla Money Mart Limited
:: Tanfac Industries Limited

UltraTech is India's largest exporter of cement clinker. The company's production facilities are
spread across eleven integrated plants, one white cement plant, one clinkerisation plant in UAE,
fifteen grinding units, and five terminals — four in India and one in Sri Lanka. Most of the plants

34
have ISO 9001, ISO 14001 and OHSAS 18001 certification. In addition, two plants have
received ISO 27001 certification and four have received SA 8000 certification. The process is
currently underway for the remaining plants. The company exports over 2.5 million tonnes per
annum, which is about 30 per cent of the country's total exports. The export market comprises of
countries around the Indian Ocean, Africa, Europe and the Middle East. Export is a thrust area in
the company's strategy for growth.

UltraTech's products include Ordinary Portland cement, Portland Pozzolana cement and Portland
blast furnace slag cement.

 Ordinary Portland cement

 Portland blast furnace slag cement
 Portland Pozzolana cement
 Cement to European and Sri Lankan norms

Ordinary Portland cement

Ordinary portland cement is the most commonly used cement for a wide range of applications.
These applications cover dry-lean mixes, general-purpose ready-mixes, and even high strength
pre-cast and pre-stressed concrete.

Portland blast furnace slag cement

Portland blast-furnace slag cement contains up to 70 per cent of finely ground, granulated blast-
furnace slag, a nonmetallic product consisting essentially of silicates and alumino-silicates of
calcium. Slag brings with it the advantage of the energy invested in the slag making. Grinding
slag for cement replacement takes only 25 per cent of the energy needed to manufacture portland
cement. Using slag cement to replace a portion of portland cement in a concrete mixture is a
useful method to make concrete better and more consistent. Portland blast-furnace slag cement
has a lighter colour, better concrete workability, easier finishability, higher compressive and
flexural strength, lower permeability, improved resistance to aggressive chemicals and more
consistent plastic and hardened consistency.

Portland Pozzolana cement

35
Portland pozzolana cement is ordinary portland cement blended with pozzolanic materials
(power-station fly ash, burnt clays, ash from burnt plant material or silicious earths), either
together or separately. Portland clinker is ground with gypsum and pozzolanic materials which,
though they do not have cementing properties in themselves, combine chemically with portland
cement in the presence of water to form extra strong cementing material which resists wet
cracking, thermal cracking and has a high degree of cohesion and workability in concrete and
mortar.

"As a Group we have always operated and continue to operate our businesses as Trustees with a
deep rooted obligation to synergise growth with responsibility."

— Mr Kumar Mangalam Birla, Chairman, Aditya Birla Group

The cement industry relies heavily on natural resources to fuel its operations. As these dwindle,
the imperative is clear — alternative sources of energy have to be sought out and the use of
existing resources has to be reduced, or eliminated altogether. Only then can sustainable business
be carried out, and a corporate can truly say it is contributing to the preservation of the
environment.

UltraTech takes its responsibility to conserve the environment very seriously, and its eco-
friendly approach is evident across all spheres of its operations. Its major thrust has been to
identify alternatives to achieve set objectives and thereby reduce its carbon footprint. These are
done through:
:: Waste management

:: Energy management

:: Water conservation

:: Biodiversity management

:: Afforestation

:: Reduction in emissions

36
Importantly, UltraTech has set a target of 2.96 per cent reduction in CO2 emission intensity, at a
rate of 0.5 per cent annually, up to 2015-16, with 2009-10 as the baseline year. This will also
include CO2 emissions from the recently acquired ETA Star Cement and upcoming projects.

Our strategy

Our projects are carried out under the aegis of the "Aditya Birla Centre for Community
Initiatives and Rural Development", led by Mrs. Rajashree Birla. The Centre provides the
strategic direction, and the thrust areas for our work ensuring performance management as well.
Our focus is on the all-round development of the communities around our plants located mostly
in distant rural areas and tribal belts. All our Group companies —- Grasim, Hindalco, Aditya
Birla Nuvo and UltraTech have Rural Development Cells which are the implementation bodies.

Projects are planned after a participatory need assessment of the communities around the plants.
Each project has a one-year and a three-year rolling plan, with milestones and measurable
targets. The objective is to phase out our presence over a period of time and hand over the reins
of further development to the people. This also enables us to widen our reach. Along with
internal performance assessment mechanisms, our projects are audited by reputed external
agencies, who measure it on qualitative and quantitative parameters, helping us gauge the
effectiveness and providing excellent inputs.

Our partners in development are government bodies, district authorities, village panchayats and
the end beneficiaries — the villagers. The Government has, in their 5-year plans, special funds
earmarked for human development and we recourse to many of these. At the same time, we
network and collaborate with like-minded bilateral and unilateral agencies to share ideas, draw
from each other's experiences, and ensure that efforts are not duplicated. At another level, this
provides a platform for advocacy. Some of the agencies we have collaborated with are UNFPA,
SIFSA, CARE India, Habitat for Humanity International, Unicef and the World Bank.

Our vision

"To actively contribute to the social and economic development of the communities in which we
operate. In so doing, build a better, sustainable way of life for the weaker sections of society and
raise the country's human development index."

37
— Mrs. Rajashree Birla, Chairperson,

The Aditya Birla Centre for Community Initiatives and Rural Development

Making a difference
Before Corporate Social Responsibility found a place in corporate lexicon, it was already
textured into our Group's value systems. As early as the 1940s, our founding father Shri G.D
Birla espoused the trusteeship concept of management. Simply stated, this entails that the wealth
that one generates and holds is to be held as in a trust for our multiple stakeholders. With regard
to CSR, this means investing part of our profits beyond business, for the larger good of society.
While carrying forward this philosophy, our legendary leader, Mr. Aditya Birla, weaved in the
concept of 'sustainable livelihood', which transcended cheque book philanthropy. In his view, it
was unwise to keep on giving endlessly. Instead, he felt that channelising resources to ensure that
people have the wherewithal to make both ends meet would be more productive. He would say,
"Give a hungry man fish for a day, he will eat it and the next day, he would be hungry again.
Instead if you taught him how to fish, he would be able to feed himself and his family for a
lifetime."

Taking these practices forward, our chairman

Mr. Kumar Mangalam Birla institutionalised the concept of triple bottom line accountability
represented by economic success, environmental responsibility and social commitment. In a
holistic way thus, the interests of all the stakeholders have been textured into our Group's fabric.

The footprint of our social work today spans 2,500 villages in India, reaching out to seven
million people annually. Our community work is a way of telling the people among whom we
operate that We Care.

GLOBAL SUPPLY CHAIN MANAGEMENT

Global supply chain management involves a company's worldwide interests and suppliers
rather than simply a local or national orientation.

Difficulties while applying Global supply chain management

38
1. companies need to consider is the overall costs

2. costs of space, tariffs, and other expenses related to doing business overseas

3. exchange rate

Factors affecting global supply chain -

1. Time -

The productivity of the overseas employees and the extended shipping times can either positively
or negatively affect the company's lead time. Customs clearance time should be considerd
seriously.

2. Overall outsourcing plan –

company needs to make decisions about its overall outsourcing plan.

3. Supplier selection –

An organization should do proper research before selection of overseas suppliers.

Because searching of supplier can be more complex for other countries in comparison to

Parent country.

4. Logistics problem –

Companies who choose to ship their manufacturing overseas may have to face some
problems regarding logistics. Questions regarding the number of plants that are needed,
as well as the locations for those plants can pose difficult logistical problems for
companies.

The Future of Supply Chain Management

The future of supply chain will be based on the following seven critical areas.

39
2. Developing forward-looking category strategies.

3. Engaging, developing and managing key suppliers.

4. Designing and operating multiple supply networks.

5. Leveraging technology enablers.

6. Collaborating internally and externally.

7. Attracting and retaining supply management talent.

8. Managing and enabling the future supply organization globally.

1. Developing forward-looking Category Strategies

Developing category strategy means to create the most value for the company by
leveraging external resources and capabilities.

Until the mid 1990s many companies used traditional approach to strategy development
means buying the same components, products, and services over the years from the same
markets and same suppliers.

After 1995, companies broadened their market and tapped some non-traditional markets.

Today, companies are looking beyond the goods and services and defining strategies for
whole new categories. In result new categories are appearing such as contract
manufacturing, facilities management, and logistics.

2. Engaging, developing and managing key suppliers

Engaging, developing, and managing suppliers is one of the important aspect in supply

40
chain. It can be executed by -

• To support the business model and category strategies.

• Improving working relationships with suppliers.

• Developing the capabilities of suppliers to meet future needs.

3. Designing and operating multiple supply networks

A mix of product characteristics and customer importance is always considered when

designing and operating multiple supply networks.

4. Leveraging technology enablers

Various new technology have been introduced since last decade and continue to add new
ones like Spend management software, e-sourcing, Electronic Data Interchange (EDI),
Radio Frequency Identification Technology (RFID) and Contract management.

5. Collaborating internally and externally

Companies should look for external collaboration for new and effective suppliers. But
they also look for internal collaboration initially with engineering and product
development, particularly in manufacturing companies. Supply Management in a
supporting and leading role.

41
 CHAPTER-3
REVIEW OF LITERATURE

42
 REVIEW OF LITERATURE
Supply chain management (SCM) is the oversight of materials, information, and
finances as they move in a process from supplier to manufacturer to wholesaler and from
retailer to consumer. Supply chain management involves coordinating and integrating these
flows both within and among companies. The ultimate goal of any effective supply chain
management system is to reduce inventory.
According to definition of APICS ( The Association for Operations Management) Supply
chain management is the “design, planning, execution, control, and monitoring of supply
chain activities with the objective of creating net value, synchronizing supply with
demand, and measuring performance globally."
According to the Council of Supply Chain Management Professionals (CSCMP), “Supply
chain management encompasses the planning and management of all activities involved in
sourcing, procurement, conversion, and logistics management”.

History –
Evolution of Supply chain management can be divided into six phases. Creation,
Integration, and Globalization, Specialization Phases One and Two, and SCM 2.0.
• 1960’s - Inventory Management Focus, Cost Control

• 1970’s - MRP & BOM - Operations Planning

• 1980’s - MRPII, JIT - Materials Management, Logistics

• 1990’s - SCM - ERP - “Integrated” Purchasing, Financials, Manufacturing, Order Entry

• 2000’s - Optimized “Value Network” with Real-Time Decision Support; Synchronized &
Collaborative Extended Network

Creation -
The term Supply chain management was first used in industry in 1980’s. The
characteristics of this era of supply chain management include the need for large-scale
changes, re-engineering, and various cost reduction program.

43
2. Integration

In this era Supply chain evolution is characterized by increasing value-addition and cost
reductions through integration. At this time Enterprise Resource Planning (ERP) systems
also introduced in the market.

3. Globalization Era

The globalization era, is characterized by the global systems of supplier relationships and
the expansion of supply chains over national boundaries and into other continents.

4. Specialization Era— Phase One: Outsourced Manufacturing and Distribution

In the 1990’s focus on “core competencies” and adopted a specialization model. Organization
started extending the supply chain beyond the company walls and distributing
management across specialized supply chain partnerships.

5. Specialization Era—Phase Two: Supply Chain Management as a Service

In this era supply chain management has grown as a service. It becomes more variable.
This variability has significant effects on the supply chain infrastructure. It enables companies
overall compentencies.

6. Supply Chain Management 2.0 (SCM 2.0) Era-

SCM 2.0 has been coined to describe both the changes within the supply chain itself as
well as the evolution of the processes. SCM 2.0 is a combination of the processes,
methodologies, tools and delivery options due to the effects of global competition, rapid
price fluctuations, and short product life cycles.

The customer starts the chain of events when they decide to purchase a product that has
been offered for sale by a company. The customer contacts the sales department of the
company, which enters the sales order for a specific quantity to be delivered on a
specific date.

44
Planning:

Once companies get the customer order, the planning department creates a production plan
to manufacture the products. To fulfill this requirements company purchase the raw
materials needed.

Purchasing:

The purchasing department receives a list of raw materials and services required by the
production department to complete the customer’s orders. The purchasing department sends
purchase orders to selected suppliers to deliver the necessary raw materials to the manufacturing
site on the required date.

Inventory:

The raw materials are received from the suppliers, checked for quality and accuracy and
moved into the warehouse. The supplier will then send an invoice to the company for
the items they delivered. The raw materials are stored as inventory until they required by
the production department.

Production:

Based on a production plan, the raw materials are moved inventory to the production
area. The finished products ordered by the customer are manufactured using the raw
materials purchased from suppliers. After the items have been completed and tested, they
are stored back in the warehouse prior to delivery to the customer.

Transportation:

When the finished product arrives in the warehouse, the shipping department determines
the most efficient method to ship the products so that they are delivered on or before
the date specified by the customer.

45
 Benefits of Supply Chain Management
1. Improved customer responsiveness
2. Higher product quality
3. Faster product innovation
4. Reduced inventory costs
5. More consistent on-time delivery

Supply Chain Management Levels

Supply Chain Management has three levels of activities : Strategic, Tactical and Operational.

All three level decisions affect product development, customers, manufacturing, suppliers
and logistics in a different manner.

Strategic Level:

This is done by top level management. At this level, company management will be
looking to high level strategic decisions related to whole organization, such as the size
and location of manufacturing sites, partnerships with suppliers, products to be
manufactured and sales markets. It is concerned with long term decisions. Strategic
decisions include product development, customers, manufacturing, vendors, and logistics.

Effect on Product Development -

46
Top level management always decides which product has to manufacture. Once the
product cycle starts declining, management has to make strategic decisions to develop and
introduce new versions of existing products into the marketplace.

Customers

At the startegic level, company always identifies who are the key customers and
according to their requirements, company manufacture the products.

Manufacturing –

At the strategic level, manufacturing decisions define the manufacturing infrastructure and
technology that is required. Based on high level forecasting and sales estimates, the
company management has to make strategic decisions on how products will be
manufactured.

Suppliers -

Company decides on the strategic supply chain policies with regards to suppliers.
Sometimes company reduce the number of suppliers or sometimes company select global
suppliers.

Tactical Level:

Tactical decisions focus on those things which will produce cost benefits such as using
industry best practices, developing a purchasing strategy with favored suppliers, working
with logistics companies to develop cost effect transportation and developing warehouse
strategies to reduce the cost of inventory.

Effect of tactical decisions on product development-

Tactical decisions have to be made as to the particular products that should be

47
developed. The company has to make tactical decisions regarding the specifications of
the products, what will be the market segment and where it should be targeted to
achieve the maximum profit.

Manufacturing –

On tactical level decisions are made on how to produce the products at the lowest cost.
Tactical decisions are made as to the adoption of manufacturing methodologies such as
Kanban or Just-in-time. Tactical decisions are required at a regional level by using
technology to reduce the material wastage.

Suppliers

At a tactical level, management work within strategic guidelines to identify and negotiate
the terms that will provide the cost benefit to the company.

Operational Level:

This level is more concerned to day to day basis on operational level. Decisions at this
level are made each day in businesses that affect how the products move along the
supply chain. Operational decisions involve making schedule changes to production,
purchasing agreements with suppliers, taking orders from customers and moving products
in the warehouse.

48
Manufacturing -

The local plant management may make an operational decision to keep certain items in
stock to ensure that production won’t stop. In this case inventory costs will increase
which is called inventory carrying cost , but a greater cost would be incurred if the
production line will be stopped due to a lack of items from a supplier.
Logistics –

Strategic and tactical supply chain decisions in the logistics process generally focus on
the use of third party logistics companies (3PL). But these 3PL companies may not
operate in all regions where the company requires logistics.

In those cases the local management make operational decisions on leasing local
warehousing and negotiating with regional logistics companies.

49
 Plan-Source-Make-Deliver-Return

SCOR contains:

1. Standard descriptions of management processes

2. A framework of relationships among the standard processes
3. Standard metrics to measure process performance
4. Management practices that produce best-in-class performance

SCOR enables the companies to:

1. Evaluate and compare their performances with other companies effectively

2. Identify and pursue specific competitive advantages
3. Identify software tools best suited to their specific process requirements

The SCOR model provides a best practice as a current, structured, proven and
repeatable method for making a positive impact on desired operational results.

1. Current - Must not be emerging and must not be antiquated

2. Structured - Clearly stated Goal, Scope, Process, and Procedure
3. Proven - Success has been demonstrated in a working environment.
4. Repeatable - The practice has been proven in multiple environments.

50
 Supply Chain Optimization
Supply chain optimization is the practice of combining resources in a supply chain with
the removal of eliminating bottlenecks and other problems that interfere with the process
and helping the supply chain function in a more smooth, timely and cost-effective
manner.

Supply chain optimization improves customers satisfaction while minimizing the cost. This
includes the optimal placement of inventory within the supply chain minimizing operating
costs (including manufacturing costs, transportation costs, and distribution costs).

supply chain optimization uses Advanced planning and scheduling (APS) technology. This
technology uses various mathematical modeling techniques to analyze supply chain data
and create simulations

Generally problems in the supply chain process are either internal or external. An
internal problem is when to order and when to ship. An external supply chain problem,
on the other hand, is shortage of materials or parts for the suppliers.

Supply chain optimization attempts to systematically prevent those problems from arising or to
provide solutions to them if they do arise.

51
 Flow in Supply chain
In supply chain materials flow downstream, from raw material sources through a
manufacturing level.
Then raw materials transforms into intermediate products.

9
From manufacturing plant manufactured product shipped to various distribution center.
And from distribution center to retailers and ultimately customers.

52
 SUPPLY CHAIN IMPROVEMENT STRATEGIES
Four areas are key to effective supply chain management - Process, Measurement,
Information management and technology.
Supply chain can be improved by integrating internal functional process and systems
across the enterprise. It includes the physical supply chain execution and management
processes like:
1- Customer service management
2- Materials and Production planning
3- Logistics and inventory management
4- Sourcing and Procurement
5- Product development and commercialization

Phase 1 - Improvement Assessment and Analysis

In this phase various opportunities and targets are defined based on operations strategy
and performance shortfalls. Benefits are qantified in this phase
Phase 2 - Analyze supply chain and processes.

Model of current suply chain flows has been prepared. Services and financial
performance are measured.

Phase 3- Design Improvement Solution

Simulated model on supply chain are used. Ideas are generated through improvement
teams and process change are defined.

Phase 4- Detailed Planning and Implementation

In the last phase of improvement detailed designs and plans are developed. Business
cases are defined.

53
Other strategies in Supply chain management on lower level -
1. Educate- All departments who are connected to supply chain must have common
understanding of supply chain.

2. Benchmark- Comparison with competitors and industry trends are very important
improve any business.

3. Assessment- Understanding the status of all departments which are connected to

supply chain can be very beneficial. Comparison with the Six Levels of Supply Chain
excellence can be greatly enhance the overall system.

 Level I, Business as Usual

 Level II, Link Excellence
 Level III, Visibility
 Level IV, Collaboration
 Level V, Synthesis
 Level VI, Velocity

4. Weakest Link- Identification of the weakest department within the sysytem and the
weakest link in supply chain will drive performance.
5. Communication- There should be proper communication within all involved department
in supply chain system so that everyone understands the ongoing process.
6. Partnerships- Only join with supply chain partners who are ready to partner. Partnering
with a link that has not achieved Link Excellence will not provide positive results.
7. Leadership- On each supply chain initiative, identify the proper skill sets required to
lead the effort. Assure clarity of roles and responsibilities and cultural compatibility.
8. Core Competencies- Identification of core competencies are mus, focus on them is
important and then outsource the rest.
9. Continuous Improvement- An ongoing process is required for to pursue Supply Chain
excellence. There should be continuous improvement all the time.

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 SUPPLY CHAIN MANAGEMENT SOFTWARE
SUPPLY CHAIN MANAGEMENT SOFTWARE (SCMS) IS A BUSINESS TERM
WHICH REFERS TO A RANGE of software tools or modules used in executing supply
chain transactions and managing supplier relationships.

It commonly includes:

1. Customer requirement processing

2. Purchase order processing
3. Goods receipt and Warehouse management
4. Supplier Management/Sourcing

Supply chain management software can be categorize by the software providers and it
has various different parameters. For instance, software can be generally categroized by
price and based on the number of employees in the organization.

Software providers for large corporations (more than 1000 employees) -

1- Oracle
2- E-Buisness Suite
3- Peoplesoft
4- SAP

Software providers for small and medium- size businesses (from 10 to 1000 employees) –

1- Epicore Software
2- ERP Studio
3- Exact Globe Software
4- M1 by B&G Software
5- Microsoft Dynamics
6- Jobscope Software

55
 Cost of Software
Ownership of these software are very costly ranges from $0.3 million to $5.5 billion. It
includes the costs of packaged software, hardware, professional services (for ongoing
maintenance, upgrades and optimization) and internal costs.

Oracle, ERP, SAP , Peoplesoft are the big software and total average cost can be up to
$5 billion including service and maintenance.

For small to mid firms cost ranges from $0.2 million to $400 million.

Application of Supply Chain Management Software

Supply chain management software assists enterprises in various areas from product
development to outsourcing.

Application in Customer Service Management:

Customer relations provide information to the manufacturer on the level of demand for
the product, and also provide feedback to the customer.

Supply chain management software calculates current demand and also predict future
demands depending on changes in strategy.

Procurement Process:

Supply chain management software can assist in resource planning for the manufacture of
products, recommending order schedules to reduce manufacturing cycle times.

Product Development and Commercialisation:

While supply chain management software cannot advise on the development of new
products it can be used to ensure best practices for their manufacture and distribution.

Manufacturing Flow Management:

Supply chain management software can assist in this process by analysing past
performance and future predictions to suggest the optimal manufacturing schedule, while
ensuring that availability of materials.

Distribution:

In distribution, software is used to calculate the process of planning and implementing an

efficient distribution schedule by optimizing manufacturing.

56
Outsourcing:

It is used to analyze areas of the supply chain in which the organization can look for
outsourcing generally outside the organization sometimes in other countries if the
company is very big.

Performance Measurement:

Performance Measurement performs a vital function in any supply chain. By continuously

analyzing the performance of the enterprise over a range of functions Supply chain
software enables managers to identify areas of weakness and opportunities for
improvement.

Formulas for measuring Supply Chain

Most commanly used measures in supply chain management is “Inventory Turnover”.

Inventory Turnover = Cost of goods sold / Avg. Aggregate Inventory Value

Situation where Distribution Inventory is important-

Weeks of Supply = ( Avg. Aggregate Inventory Value / Cost of goods sold ) * 52 Weeks

The Bullwhip Effect in Supply Chain

The Supply chain is a complex group of companies that move goods from raw materials
suppliers to finished goods retailers. These companies work together when meeting
consumer demand for a product; supply chains allow companies to focus on their
specific processes to maintain maximum probability.

Definition -

The bullwhip effect on the supply chain occurs when changes in consumer demand
increases. Because of this increment companies order more goods to fulfill the new
demand.

The bullwhip effect usually starts with the retailer, wholesaler, distributor,
manufacturer and then the raw materials supplier.

Factors contributing to the Bullwhip Effect -

57
 1. Forecasting Errors

This happens when companies enter new products into the marketplace, they estimate
the demand of the good based on current market conditions. Generally most

14
companies order for more good than they can sell. This "extra" inventory begins to
increase or decrease during the normal market fluctuations of supply and demand.
When demand increases, the companies increase inventory to meet the consumer
demand. While when the demand falls, companies decrease their inventory.

2. Behavioral Causes

Ordering of too much inventory when consumer demand has fallen for an item can
cause the effect. Some times retailers raised their inventory levels to avoid being out
of stock. This creates overstock of inventory for each supply chain company.

3. Operational Causes

The main cause of the bullwhip effect comes from individual demand forecasts from
each company in the supply chain. This causes an increase in demand from companies in the
supply chain, but not the actual consumers who will purchase the goods.

4. Lead Time-

Longer lead time leads to greater variability in the estimation of average demand.
Due to which inventory cost will increase.

5. Batch Ordering-

It occurs because of rise and fall in Orders.

6. Price Fluctuations

7. Lack of centralized information

Corrective Measures

Consumer demand based on the order information should be properly evaluated which
allow managers to order more goods if needed.

58
 New Dimensions in Supply Chain Management
New dimensions in supply chains are basically internal, external, and customer :
Internal dimension — the supply chain system controlled by the organization
A company’s internal dimension is the physical aspects of its business that are
largely under its control. These include manufacturing, distribution, or retail capacity and
the time and costs that put into sourcing, producing, and distributing products. Improving
performance in these areas should be the priority of most supply chain management
initiatives.
For distributors and retailers, the priority has generally been on supplier relationship
management, warehouse management, and transportation management solutions and the
integration of those solutions to deliver visibility of supply.
External dimension— the supply chain company can’t control

The external dimension is comprised of business factors over which companies have little
or no control. So the external dimension has been a lower priority from many supply
chain initiatives.

These external dimensions can be predictable. With the right approach and technologies,
companies can incorporate these predictable external factors into their strategic, tactical,
and operational planning

External dimension also includes forces that are difficult to predict like a sudden
Change in fuel prices, worker strikes, and delays in shipping or major weather
catastrophe.
To avoid the problems of the external dimension, companies should increase and extend
their supply chain visibility, and improve the measurement of performance.

Customer Dimension - Provides influence but can not be controlled

The customer dimension is a combination of busines characteristics over which they have
influence, but not total control. These decisions are based on a customer-centric view of
the supply chain. Supply chain management can be improved by a combination of

59
Producers to producer’s competition: This kind of competition occurs between the producers
through companies. More such kind of competition is beneficial for the industries & may results
into following:

• Increase quantity

• Increase quality

• Decrease price

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 DISTRIBUTION

TRANSPORT MANAGEMENT SYSTEM

A Transportation Management System (TMS) is a software system designed to manage

transportation operations.

TMS are one of the systems managing the supply chain. They belong to a sub-group called
Supply chain execution (SCE). TMS, whether it is part of an Enterprise Level ERP System or
from an integrated "Best of Breed" Independent Software Vendor(ISV) has become a critical part
of any (SCE) Supply Chain Execution and Collaboration System in which real time exchange of
information with other SCE modules has become mission critical.

In more recent times, we have seen that these systems are being offered in many different types
of licensing arrangements. These different arrangements have given shippers who otherwise
would not be able to afford sophisticated software the opportunity to utilize TMS to better
manage this vital function. The 3 primary offerings are:

• 1. On-Premise Licensing (traditional purchased li cense)

• 2. Hosted (remote)

• 3. On-Premise Hosted Licensing (a blend of 1 & 2)

Additionally, we are seeing that some software providers have either been acquired or merged
with traditional supply chain management consultancies and are now offering shippers "blended"
managed and software services as an outsourced process. Primary Tier 1 TMS providers are still
independent, carrier and 3PL neutral, and ERP neutral. TMS usually "sits" between an ERP or
legacy order processing and warehouse/distribution module. A typical scenario would include
both inbound (procurement) and outbound (shipping) orders to be evaluated by the TMS
Planning Module offering the user various suggested routing solutions. These solutions are

61
evaluated by the user for reasonableness and are passed along to the transportation provider
analysis module to select the best mode and least cost provider. Once the best provider is
selected, the solution typically generates electronic load tendering and track/trace to execute the
optimized shipment with the selected carrier, and later to support freight audit and payment
(settlement process). Links back to ERP systems (after orders turned into optimal shipments),
and sometimes secondarily to WMS programs also linked to ERP are also common. Most TMS
systems help shipper directly work with asset-based carriers and support dis-intermediation
(including avoiding use of non-asset based brokers and other intermediaries).

Transportation Management Systems manage three key processes of transportation management:

• 1. Planning and Decision Making: TMS will define the most efficient transport schemes
according to given parameters, which have a lower or higher importance according to the user
policy: transport cost, shorter lead-time, fewer stops possible to insure quality, flows regrouping
coefficient…

• 2. Transport follow-up

TMS will allow following any physical or administrative operation regarding transportation:
traceability of transport event by event (shipping from A, arrival at B, customs clearance…),
editing of reception, custom c learance, invoicing and booking documents, sending of transport
alerts (delay, accident, non-forecast stops…)

• 3. Measurement

TMS have or need to have a Logistics KPI reporting function for transport.

Various functions of a TMS:

62
• Planning and optimizing of terrestrial transport rounds
• Transportation mode and carrier selection
• Management of air and maritime transport
• Real time vehicles tracking
• Service quality control

• Shipment batching of orders

• Cost control, KPI (Key performance indicators) re porting and statistics o Typical KPIs
include but not limited to:
1. % of On Time Pick Up or Delivery Performance relative to requested

2. Cost Per Metric - mile; km; Weight; Cube; Pallet

Route Planning and Optimization

• Reduce Distribution Costs & Fleet Miles - Daily r outes are created using powerful
algorithms and street-level routing, in conjunction with your business constraints

• Increase Resource Utilization-Make better use of existing resources by delivering more

and driving less. The answer to increasing volume is not always to put more vehicles on the
road, but to make smart, efficient

• Make Sound Business Decisions -Understand how del ivery costs affect the profitability
of each customer by knowing the actual cost per stop

• Set Driver Standards - Creating route plans and gathering actual information allows you
to set performance standards and expectations-which can result in less overtime and better driver
performance
• Decrease Routing Time - Let your routers spend le ss time configuring routes and more
time assessing what-if scenarios to produce better, more efficient routes.

• Contingency Planning - Prepare for holiday or sea sonal spikes and other "what if"
scenarios

63
• Reports - Driver manifests, maps, directions, resource utilization, customer delivery cost,
actual versus projected by route and by stop, planned route summaries and many more reports to
help you consistently evaluate your success

Load Optimization

• Accurate and Quick Load Design for Multiple Route Types - Each type of route requires
different loading patterns. Determine (or assign) equipment to warehouse bays with capacities,
preferences or even empty bays for returned goods

• Multiple Loading Strategies - Different delivery operations require different loading

strategies. Our warehouse-friendly software allows for greater picking efficiencies by grouping
SKUs. Driver-friendly groups product by stop, minimizing the number of bays a driver must visit
at each stop

• Pre-Build Orders - Load orders to be picked, buil t and pre-staged throughout the day, all
while continuing to have them allocated to the correct route and truck during the final loading
pass

• Load Design to Reduce Product Breakage - Most bre akage occurs within the first

10 minutes of a route due to poor packing. Fleet Loader's leading loading algorithms allow for
proper mixing and stacking to reduce breakage

• Reports - Final load sheet, driver check-out, load validation and pick sheets provide you
with all of the detailed information you need

64
 CHAPTER-4

DATA ANALYSIS
AND
INTERPRETATION

65
 DATA ANALYSIS AND INTERPRETATION

The data collected through the questionnaire are analyzed to know about the respondents
opinions about various particulars asked in the questionnaire were through phone and emails.
Questionnaire was entered into spreadsheet and the data has been interpreted. The questionnaire
comprises of fourteen questions with subparts for each. The topics covered are with decisions of
each operational area, employee numbers of each firm, profitable area in operation, catering
location, service offering, organizational effectiveness, inventory, location, product availability
and customer satisfaction.
a) Which are the logistics services organizations offers?

Sr.no Service Percentage

01 Freight 100
02 Warehousing 89
03 Cross docking 88
04 Network design 66
05 Value adding 98

Chart-1 service offer

3 Cross docking,
88
4 Network design,
66
2 Warehousing, 89
Other,
164 5 Value adding, 98

1 Freight, 100

INTERPRETATION : The pie chart above shows the service offer of each organization. The
chart shows that 100% of the respondents provide freight service and almost 90% provide
warehousing and cross docking. Only 66% were providing service of network design. Other
service includes value adding, which represents 98% of the sample. It includes packaging,
labeling etc.

66
 b) Operating with other logistical provides and reasons for decisions

Table – 2 operate with logistical provides

Sr. no Decision Percentage

01 Operational satiability 11
02 Cast effectiveness 10
03 Customer needs 36
04 Other 96

Chart-2 operate with logistical providers

96
100
80
60
36
40
11 10
20
0
Operational Cast Customer Other
satiability effectiveness needs
1 2 3 4

Percentage

INTERPRETATION: The above graph shows the operational decisions and reasons for
operations with other logistical providers. The chart shows that 96% of the respondents operate
with other service providers for different reasons like coordination, clearance, bulk operations
etc. almost 36% have operations with other providers as per customer needs. Only 11% and 10%
were providing service along with other providers for the purpose of operational stability and
cost effectiveness respectively. It is stated that 96% of organizations operate with other logistical
providers and remaining 4% as stand aloe’s what is the made of decisions regarding the
operations.

67
Table-3 mode of decision

Sr. no Operational decisions Percentage

01 Strategic 37
02 Tactical 88
03 Operational 63

88
100

80 63

60 37
40

20

0
Strategic Tactical Operational
1 2 3

Percentage

INTERPRETATION: The above graph shows the mode of decisions regarding the operations.
The pie chart shows 88% of organizations take tactical decisions followed by 63% with
operational decisions and 37% strategic decisions. Most of the organizations have a mixture of
all the decisions in their day-to-day as well as in long and short plans

68
 c) Number of employees in each type of the service rendered of the organizations.

Sr. no. Department in Number of people Percentage

organization in each
01 Top management 45 11
02 Operations 46 11
03 Account/finance 45 11
04 Marketing 51 09
05 Human resources 37 13
06 Documentations/others 184 45

Table – 5 employees
184
200
180
160
140
120
100 45 46 45 51 37 45
80
60 11 11 11 9 13
40
20
0
Account/finance
Top management

Operations

Marketing

Human resources

Documentations/ot
hers

1 2 3 4 5 6

Number of people in each Percentage

INTERPRETATION
i) Decision making is excellent for organization with respect to other organization in the
industry
ii) Operation with other logistical providers should be given more preferences to achieve
cost effectiveness.
iii) Tactical decision are mostly followed by organization followed by operational and
few strategically.

69
D.
Sr. no. Department in Number of people Percentage
organization in each
01 Top management 03 14
02 Operations 04 14
03 Account/finance 04 18
04 Marketing 03 18
05 Human resources 0 0
06 Documentations/others 08 36
Table – 5ii employees
36
40 18 18
30 14 14 8
20 3 4 4 3 0 0
10
0
management

resources
Operations

Documentation
Account/financ

Marketing

Human

s/others
Top

1 2 3 4 5 6

Number of people in each Percentage

INTERPRETATION:
The above graph shows the compression of employees in each functional division of
organization with ULTRATECH, HYDERABAD.. The line chart shows around 14 % of people
belong to top management and industry standards has 11%, followed by 18% for
iv) Industry category. This can be achieved with more modern equipment’s and proper
guidance to employees and the rating can go high to excellent service.
v) Pricing of the products is satisfactory, which organization can further enhance with
proper management. Present employee’s strength is satisfactory compared to other
organization where the firm has lesser employees compared to other organization.

70
 CHAPTER-5
FINDINGS, SUGGESTIONS, CONCLUSIONS

71
 FINDINGS

Significant losses/damages during shipping

The next problem in setting up organized retail operations is that of supply chain logistics. India
lacks a strong supply chain when compared to Europe or the USA. The existing supply chain has
too many intermediaries: Typical supply chain looks like:- Manufacturer - National distributor
Regional distributor - Local wholesaler - Retailer -Consumer. This implies that global retail
chains will have to build a supply chain network from scratch. This might run foul with the
existing supply chain operators. In addition to fragmented supply chain, the trucking and
transportation system is antiquated. The concept of container trucks, automated warehousing is
yet to take root in India.
Inadequate infrastructure
The lack of proper infrastructure and distribution channels in the country results in inefficient
processes. This is a major hindrance for retailers as a non-efficient distribution channel is very
difficult to handle and can result in huge losses. Infrastructure does not have a strong base in
India. Urbanization and globalization are compelling companies to develop infrastructure
facilities.
Almost 78% of total freight is transported by road.
Almost 78% of total freight is transported by road. But, according to the FICCI-E&Y retail
report, roads connect less than half of the half a million Indian villages. The normal distance
covered by trucks and trailers in India are 250-300 km a day, whereas the international norm is
600- 800 km a day. Most roads in India are designed to carry a maximum gross weight of 16.2
tones, which allows for a maximum loading of about 9 tones. This severely restricts the ability to
transport goods on larger vehicles.
Warehouses located far from city

Some of the warehouse are located in villages and are far from the city so it takes time for goods
to reach mall.

72
 SUGGESTIONS
· The company should start a home delivery where a particular household
will order full range of products required by it over a period of time. For this the
company could provide a deliveryman with cycle to reach the different houses.
· In order to motivate the channel members it is also very essential for the company
to increase the distributors for the hard selling items e.g. ULTRATECH (curd)
where it faces competition from ULTRATECH
· ULTRATECH should go in for exclusive outlets in at least all the shopping malls
coming up these days and any location where footfalls are large in number. The
advantages of this channel will be:
i. Full range display
ii. Convenience for distributors.
iii. Easier to access new customers.
iv. Easy to push impulse purchase products
v. Brand building will be facilitated
· In order to remain sensitive to market demand, it is essential for the company to
have additional procurement options ready that will help company to cope up
with the problem of less supply or shortage of raw MATERIAL.
· In order to practice a better supply chain management ULTRATECH should make
use of updated/upgraded/latest ERP packages like MFG PRO
· Distribution strategies.

73
 CONCLUSION
ULTRATECH is having its own logistics called future logistics but in near future to
cope up with the changes it have to do a lot. the logistics companies at present provide services
from transportation to warehousing and inventory management. But, in the near future, they will
have to expand their products baskets to include new value added services, such as packaging,
labeling and reverse logistics.

The biggest challenge that faces these companies is that they should quickly imbibe latest
technologies, such as GPC/GIS tracing of consignment, and uncork new services to cater to
corporate seeking to outsource their logistics needs. Also, the government should come out with
a sound policy that facilitates the operations of the logistics companies

According to the study done on the feedback of questionnaire, data interpretation and
analysis the results are as follows-
The result shows that the ULTRATECH ltd. practices supply chain with the help of
many suppliers. Meanwhile the company is managing its supply chain successfully. The
company has a separate logistics and dispatch department. ULTRATECH ltd has a clear
and sophisticated logistic plan.
Operational activities and supply chain management activities of the ULTRATECH
ltd are by the support of supply chain benchmarking. The company is planning to
implement and practice the e-procurement, EDI plan strategically in future.
Current supply chain management and IT activities of the company are going
flawless and in future there is scope for better supply chain and distribution network.
The current transportation and logistics management of the company is sufficient and is
flexible enough so as to change the current policies if any.
The study has shown us that there is some obstacles during handling and storage of
Cement products which creates hurdle in SCM therefore should be eradicated.

74
 BIBLOGRAPHY
Books -
· James Evans, Supply chain management, Tata McGraw hills 3rd edition p.n. 405 to
450
· Alberta Russel,Supply chain management, Wiley publication, 1st edition p.n. 1 to 50.
· John T. Mentzer ,Supply chain management Tata McGraw hills 4th edition p.n. 65
to 90
· Harland ,C.M.(1996) Supply Chain Management, Purchasing & Supply Chain
Management, Logistics, Vertical Integration, Material Management & Supply
Chain Dynamics. Excel books, p.n. 354 to 370.
· Operations management along with supply chain management by Russell and
Taylor.
· Upendra Kachru, Exploring the supply chain theory and practices, Tata McGraw
hills,p.n.210 to 250.

Websites-
· www.wikipedia .org
· En.wikipedia.com.au/glossary.asp
· http://www.scribed.com
· http://www.google.com

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