4. Common supply chain system
It is commonly associated with mass production industries.
• In it investment in developing and implementing radical new process can
be justified against in large volume turnover.
• Womack and jones found that it is in low volume operations & in mass
production on the scale is found in automotive industry.
• This is a reasonable assumption that electronic products comprise with
more cob spares.
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5. • Majority of changes or repair of ship is done in dock by ‘Prime Contractor’.
• When a ship its repair has to be done immediately inside the dock.
• Base maintenance is equally important as ship.
• The level of inventory for each ‘Line Replace Unit’ or spares is determined by
‘SOR’, only for an operational period of time.
• SOR criteria is demanding in it twice of spare parts are carried expected to be
used in a warship or in an operational period of time.
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6. • In this development cost is high relative to material cost.
• Spares support is an act which is found to be potentially promising and
indicates future success.
• Rubric ally there are two types of provision in the support of ship spare parts
i.e.
1. Forward Support
2. Base Support
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7. • Ship carry a limited amount of tools, spares (electrical & mechanical),
so that so that repairs and some maintenance can be performed whilst
at sea.
• The range of forward support is limited which makes the ability to do
maintenance if required.
• The crew members are 95% sure of getting help from spare parts, on
warship.
• Prime Contactor gets the supply of ‘OEM’, & the prime contractor
replaces the damaged spares.
• Damaged spares goes back to the suppliers, to be renewed.
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9. • Each spare of ship is made by different producer.
• It has alternative arrangements.
• Suppliers has to be fixed for a permanent time.
• It will be seen at the time of repairing that whether it is provident or
not & how much time it will take.
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10. • Replacing each product takes a lot of time.
• In the JIT based ship spares will hold reduced stock at its shore base.
• JIT has better option of delivery. (5 days)
• Information will be provided to supplier about the renewing of
damaged spares.
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11. • Damaged part will straightly come to the supplier and he is
independent to replace the damaged and trash the destroyed
one.
• There will be a fixed fee to renew spares and in limited period
of time for no loss.
• After having a good relationship with supplier, he/she will be
asked to take the most cost-effective decision.
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12. • Supplier will also be asked to improve the reliability of its equipment.
• There will be a ‘VENDOR MANAGED INVENTORY’ system.
• These are the smart policies of defence project.
• In JIT there will be COTS & VMI.
• The holding of electronic parts data and/or partially manufactured
components at the suppliers’ premises so that they can be completed
and shipped quickly when required.
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13. • This will also work in time when the accounting trade-
off between the risk of losing a sale, due to the absence
of immediate
availability, can be balanced with the cost of inventory.
• It is sufficient to see the change by using JIT.
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Question?
1 How does the proposed JIT system compare with/differ from the existing conventional
spares provisioning process?
Answer- The Common Supply Chain System differs from the JIT system because the
space was saved in the shore base, even the cost which has to be paid for new items after
having JIT system it will reduce cause all the suppliers were different and they take
different times to repair in which but now all the items will be collected at one place with
fixed time of repairing given as 5 days, in JIT there is fixed delivery time of new items, the
Common Supply Chain System use to satisfy with providing spares within 90 days but
they don’t use to repair and there was not fixed cost of items, but the JIT has a fixed cost.
Their was limited transparency was their (not enough) between Shore base and OEM but
JIT has transparency which makes a better relationship OEM & Shore base and event good
at process, shore base space is saved by JIT by providing required inventory.
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2 What are the qualitative benefits that might accrue, based on the data made
available in the case study?
Answer- The qualitative benefits are as follows:
• Their was fixed time of delivery but in JIT there is within lead time, but their was fixed
time delivery but with supplying only new spares but in JIT we will also get renewed
spares by which a lot of cost was saved.
• By the data spares will be get repaired or renewed on COB or at Dock on time.
• There is fixed time of 90 days .
• The cost of each part from supplier is marked up 10% for navy.
• Parts were renewed in the limited time with limited cost £35,000/ per annum.
• Their will be a contract for a limited time of 2 years.
• There is also guarantee of delivery demand.
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3 The stakeholders involved in implementing this proposal may be broadly grouped into
three categories: the MOD/Navy, the prime contractors (organizations who provide first-
line and dockyard services to the MOD) and subcontractors (the organizations in the
industries that supply and support the prime contractors).What do you believe the
issues/problems would be in applying JIT principles to spares provisioning from the
perspective of each of these groups respectively?
Answer- The limited time of delivery and working progress with a huge transaction will
be a lot and demand will be regularly for spares makes the stake up but after having JIT
the transaction will be limited as much sapres required cause in JIT there is
replenishment of damaged spares and there is specific supplier for specific spare as
example is given in case of radar supplier but in JIT has better provision than them for
repairing and within lead time delivery option.
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4 Based on the illustrative numerical data presented above, how attractive is the JIT
proposition from a financial perspective, assuming this simplified quantitative example
is typical of others (work through the calculations to produce your answer).
Answer-
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5 Weighing all the evidence available, do you believe that it would be feasible and
advantageous to move towards a JIT based system for spares provisioning to Royal Navy
warships? Explain your reasoning.
Answer- Yes, cause there are benefits in cost and saves time which is also equal to cost, a
good planning and control is done only when we have transparency between the buyer
and the supplier which makes a better relationship and manufacturer could be
motivated to produce better quality of stuffs. Fixed prices for new items could be money
saving for Navy which is £1,10,000, & even there is also a provision of repairing which
is also delivered in fixed time & it costs £35,000. The relationship between
manufacturer and supplier is very good then may be the contract period of work could
be extended for further.
