3. What Is The Project All About?
• The SCM dept has a set of service index parameters to measure its
performance, which is referred as OTRI ,OTDI and OTSI.
• It deals that How well we are satisfying the customer?
• The study has been conducted at zonal basis, product basis, and
contract basis.
• The main aim of the project is to bring the service index to 100%.
• Also a detail analysis will be done for top customers , because if we
satisfy the top customers we solve all the problems.
• After the analysis ,suggestions are expected .
• A customer analysis matrix was done to categorize products.
• On the basis of suggestion a sample of 15 days would be taken
from the current month and the suggestions would be implemented
4. What is Supply chain?
Supplier Manufacturer Distributor Retailer Customer
• Consists of all parties involved, directly or
indirectly, in fulfilling a customer request
5. Objective of a Supply Chain
• Maximise overall profit
• Profit
– Revenue generated from customer - costs
incurred along the entire chain
(e.g. manufacturing / storing / distributing the
product)
• When is Supply chain effective?
– Manage Product, Information and Fund flow
7. OTRI-On Time Readiness Index
• When an FME (Field Marketing Executive) gives a date to the
customer for the delivery of products, it is conveyed to the PPC
department (Production Planning & Control).
• The PPC according to its schedule plans it in such a way that it is
delivered to the customer on time.
• In order to check the performance of the manufacturing unit, OTRI is
measured with respect to the scheduled date of manufacture. The
percentage of material produced as per the readiness plan is
Compliance and the percentage of material not produced as per the
readiness plan is the Non-compliance.
8. Example
• An automobile company orders for 7 different items, each of 100
tonnes, that means ESSAR STEEL has to produce 700 tons overall.
• Now out of the7 items ESSAR STEEL satisfies the quantity wise
compliance of 6 items means for 6 items it has produced more than
90 tons which is benchmark OTRI (if the OTRI% quantity wise is
90% then it is said to be complied otherwise noncomplied).
• Thus OTRI in terms of quantity is 85.7% and in terms of item is
85.7%.
9. Concept Of bucket system
• The SCM dept has distributed the production part in the form of
bucket system. For example A Hot roll coil was scheduled to be
manufactured on 1st June 2010 so it comes in the bucket of 1st June
to 5th June and if the Hot roll coil is produced in this bucket it is given
a Y (YES) compliance. If it moves to other bucket ie 6th June to 10th
June then it is given N (NO) . In this way each month has 6 bucket
as every month has minimum of 30 days
1st -5thJune 6th -10th June 11th -15thJune 16th-20th June 21st -25th June 26th -30th June
10. OTDI-On Time Dispatch Index
• For a customer material order is equivalent to not being
manufactured until it is delivered at his doorstep.
• For this reason, the SCM department has kept the parameter of
OTDI i.e., after the material is produced is it also being dispatched
on time?
• The OTDI also makes use of the bucket system as that of OTRI.
19. DOMESTIC
• The OTRI% of the south zone is found to be highest as the number of orders in the south
zone is lowest and it is easier to process less no of orders so the OTRI% is bound to
remain higher.
• The west zone gives the maximum number of orders to the company due to the
proximity of the company to the market. The customer bears transportation costs.
• The average OTRI% in the DOMESTIC customer segment is 81%.
20. EXPORT
• OTRI% of the export market is always 100% and above as the finished goods need to be
dispatched on time. The dispatch of the finished goods is subject to vessel availability.
• Even the priority of export goods changes due to vessel non-availability
21. Retail
• The OTRI% of the retail zone in both the zone is 90% and above, as it is a form of MTS
(MAKE TO STOCK) arrangement.
• Also the forecasting accuracy in this segment is better than other segments.
22. SERVICE CENTRE
• The average OTRI% of the service center segment is 88%.
• The OTRI% in the south zone is lower than other zones due to the odd grade
requirements rather than regular ones by the customer.
27. Products which come under AA category
• Needs to be leveraged to the maximum.
• The supply chain for such products should be efficient.
• For procurement of raw material even if it is costing more than
normal prices also it should be purchased , because that particular
product can be the
• USP(UNIQUE SELLING POINT) for that zone which is giving the
maximum returnsin that zone.
• Sales order release for that product should follow SOP (Standards
Of Operating Procedure), so that the lead time is according to the
norms set, this will help in dispatching the product at right time, thus
building a trust and enhance the brand further.
28. Products which come under BB category
• BB category products are those products which have a potential to
come in A category either in terms of quantity sold or profit margin
but cannot due to various reasons.
• Steps must be taken by various departments to bring them to A
category either in terms of quantity sold or profit margin or both.
For increasing the frequency of products being sold, responsibility
should be given to the Marketing department and a detailed analysis
should be carried out on zonal basis, where competitor’s share in
that zone for that particular zone should be studied and then
necessary steps should be taken to increase the share. Results
would not be achieved overnight so the targets could be broken
phase wise.
• Like the first target would be to increase the share by 5%. Once that
is achieved second target could be set.
29. Products which come under CC category.
• These are the products where the company is not making profits as
compared to other products.
• It is better for the company to concentrate less on such products
because the results won’t yield much
