This document discusses supply chain management and the future of logistics. It covers key factors for supply chain success like route optimization, inventory management, and technology. It discusses concepts like demand driven value networks, integrative improvement systems, and supply chain maturity. It addresses topics such as inventory optimization, different planning needs, talent management, asset management, transportation methods, warehousing, packaging, and the roles of technology. It outlines principles of asset management and discusses the future of supply chains, challenges, and measures for success.

1. SUPPLY CHAIN
A FUTURE APPROACH…….
Zubin Poonawalla
CEO – GreenLogiNXT Pvt Ltd
Copyright © 2011. All Rights Reserved

2. SCM Concept
When deciding a SCM plan, a company needs to consider warehousing, transportation,
environmental conditions, cost to the business and potential profit.

3. Key Factors For Success
 Route & vehicle Optimization
 Customer service
 Inventory management
 Transportation
 Warehousing
 Technology
 Packaging
 Logistics providers

4. Demand driven Value Network
 Integrative Improvement System - can be defined
as a standard system that simultaneously and
interdependently drives operational improvement
across all functions and processes
 Three key structural components
 Maturity- and process-based transformation
 Functional integration
 Sustainability through a three-tier system

5. Integrative Improvement System
 Maturity- and process-based transformation
Transferring process improvement ownership from
technical experts to front-line teams requires
structural reorganization around lateral processes.
 Functional integration
The integrative approach is an organization primarily
designed around processes, products, and
customers, not functions.
 Sustainability through a three-tier system
Sustainable improvement does not result from the
mere application of improvement tools and processes
for example Lean, Six Sigma, autonomous
maintenance, one point lessons etc. Sustainable
change requires a three-tier system – management
principles, operating systems, and tools

6. Supply Chain Maturity Matrix

7. Inventory optimization
The need to better control and optimize inventory levels across the network has never been
greater. A newer set of technology tools, generally referred to as Inventory Optimization
technology, are helping companies to gain competitive advantage, reduce costs, and
increase service levels through significantly enhanced inventory management

8. Inventory optimization Benefits
• Reductions of 20-40% in inventories of finished goods, components
and raw materials trough inventory parameter optimisation.
• Increases of 5-10% in order fulfillment rates and on-time deliveries by
network optimisation.
• Reductions in planning effort as a result of the implementation of
reliable, automated processes

9. Different Planning Needs
The companies with
effective Planning Process
typically have well defined
steps, responsibilities for
each step and a monthly
time table of when the
PLANNING various steps are expected
to be completed. Today it
is well defined and
connected with the help of
sophisticated systems to
define and analyze.

10. Talent Management
Analyst research has proven that organizations using talent management strategies and
solutions exhibit higher performance than their direct competitors and the market in
general. From Fortune 100 global enterprise recruiting and performance management to
small and medium business e-recruiting, leading companies invest in talent management
to select the best person for each job because they know success is powered by the total
talent quality of their workforce

11. Asset Management
Asset Management helps in tracking each asset and what asset
the company owns, who is using them and in which department
/location using wide range of handheld devises with bar-
coding technology. This is also widely used by retail outlets to
help maintain inventory.

12. Principles Of Asset Management
 Set a vision for how your utility will manage assets in
the future;
 Understand best practices, to apply and to attain the
vision;
 Define achievable strategies, projects and measures
to guide you from where you are now to where you
want to be in the future;
 Determine what business processes and technologies
will be affected by adopting best practices;
 Optimize your organization for high efficiency.
 Identify how information systems can support your
strategies and goals.
 Prioritize and sequence projects required to attain
your program

13. Technology & Logistics
 Integrated technology, consulting and logistics
solutions, are providing businesses with a
comprehensive range of business solutions to all
facets of the supply-chain pipeline; from
procurement, order fulfillment, product Lifecycle
management, end-to-end logistics and program
management through to analysis and reporting.
 Besides technology also helps in labor
management, route tracking, warehouse
maintenance ,inventory ,transport management,
customer & order management and demand
planning

14. Technology & logistics

15. Technology & Route
Optimization
 Route Planning is a transport route optimization
software for Logistics and BPO industry. Route
Planning utilizes state of the art
technology to help BPO companies optimize routes
and generate huge cost savings and operational
efficiency.
Using a GIS based map of the city, Route Planning
deploys proven
proprietary algorithms to generate the most efficient
routes,
customized to your business needs. It provides
optimum fleet
utilization, efficient information flow, what-if analysis
and detailed

16. Packaging & technology
 Despite a global recession, emphasis is on innovation in design, choice of
materials, processing, and life cycle logistics.
 The future of packaging is in sustainability.
 Environmentally conscious decisions are being prevalent today and more and more
importance given to it being environmentally friendly.
 Walmart continues to be on the forefront of sustainable packaging in the retail
arena. Although the retail giant has achieved many of its environmental goals such
as plastic bag reduction, it continues to be unable to eliminate PVC from private-
label packaging. As sustainable packaging evolves, Walmart will continue to strive in
achieving its PVC elimination goals.
 Many other large companies are following suit including Proctor & Gamble. Very
recently, they announced plans to use sugarcane-derived plastic on selected
packaging for its Pantene Pro-V, Covergirl and Max Factor brands to increase its
sustainability credentials. The strategy by P&G is completely consumer-driven.

17. Transportation
• The road freight segment in India is gradually
evolving from being a pure transportation
business to a complete, service-based, end-to-
end logistics solutions industry.
• Increase in competition and private investments
happening getting more players
• Many players have tied up with large clients,
particularly in the automotive, pharmaceutical, and
retail sector to provide complete supply chain
solutions.
• Large fleet operators have been looking at
providing multi-model logistics solutions via a
combination of rail and road network and
exploring opportunities in this area through:
(a) JVs / partners with container cargo movers
(b) long-term rake hire contracts with the railways.

18. Transportation - Shipping
The skills on fleet management are centered in port operations
,warehousing and cost effectiveness, but also on how to cope with
incidents, thus realizing safe and environmental friendly operations

19. Transportation - Air
RPK billions
Source: World Market Forecast

20. Transportation - Railways
The importance of railways to port logistics creates a dependence of the
ports upon highly reliable railway service.
i) Lower transportation cost
ii) Higher reliability
iii) Relatively safer and secure
iv) Very environmentally friendly
v) Reduced accidents.
The freight segment accounts for roughly two thirds of railway’s
revenues.

21. Transportation -Emerging concepts
The Companies in logistics for procurement, manufacturing, and sales,
aiming to reduce CO2 emissions and costs. For example, the monthly
transportation volume of products and parts from China to Japan is
enough to fill 400 40-foot containers. To the Americas and Europe,
products and parts of a volume equivalent to 1,000 40-foot containers
are shipped from China each month. Given these volumes, efficiency
improvement in logistics is an important issue in promoting business
on a global scale.
Importance is now given to cargo carrying efficiency through reviewing
packaging materials and mixed packing, modal shifts among
warehouses, direct deliveries to customers, and by optimizing
transportation routes through the introduction of the milk run system.
The aim is to reduce wastage related to packaging materials,
transportation, space, trans-shipment, and storage.

22. Warehousing
One of the most important element of
supply chain management is
warehousing. The proper storage and
tracking of inventory ensures that
delivery times are met and asset
management Services costs are
reduced.
Warehousing facilities are completely
equipped to handle all kinds of cargo.
They are well guarded and spacious,
provide complete safety of the goods.
Keeping the goods intact and
impervious to any kind of damage.
Outsourcing the warehouses has
become more and more competitive

23. Warehouse Management
 The selection of location of ware house has long term
repercussions in reducing the operating cost and smooth
running of operations
 The store layout are easy movement of material, good
housekeeping, sufficient space for men and material
handling equipment, and optimum utilization of available
storage space.
 Depending upon the type of material to be stored in the
warehouse, number of people involved in the handling
operation, design the infrastructure and facilities of
warehouse.
 Today letting out warehouses are building one has
become lucrative business

24. SCM Future
 Segment customers based on the service needs
 Analysis can be used to segment customers
based on "buying behaviors," and network
models can be used to calculate the cost-to-
serve of each segment under varying scenarios.
 Strategic sourcing analyses should be
undertaken, followed by the installation of e-
procurement software to sustain the savings
identified, on an ongoing basis.
 Supply chain planning technology should be
implemented - it is the critical link between
supply chain strategy and supply chain
operations.

25. 3 Party Logistics
 It has been found that 64 percent of the study’s
respondents are using more 3PL-based services, with
42 percent of total logistics expenditures allocated
for outsourcing and another 58 percent citing how
they are reducing or consolidating their 3PL partners.
 Private investors are getting more and more involved
and play a role in getting into all areas of logistics
and thus affecting nature of the global economy
continues to impact buyers of logistics services.
 Information technologies are a necessary element of
3PL expertise and are becoming a must with the 3PL
providers. In recent years the gap has narrowed, with
93 percent viewing IT as a necessary element of 3PL
expertise and 54 percent of shippers indicating they
are satisfied with 3PL IT capabilities.

26. ecommerce
 The trend of outsourcing logistics solutions has
led companies Internet based e-commerce
outsourcing solutions.
 They have formed an alliance with all the players
in the logistics sphere have global coverage.
 E-commerce already is substantially influencing
business in Asia. More and more people are
using it to get to the core of supply chain and
minimize the time of response to the end
customer and have real time inventory system

27. The Future Of Supply Chain
The three A’S
AGILE
ADAPTABLE
ALIGNED

28. Future of Supply Chain
 Market Sensitive - The company should be able to read and
understand the demand in the market as well as being able to
respond to it.
 Virtual Supply Chain-This is information-based. By using
information technology applications, such as electronic data
interchange (EDI), all parties through the supply chain have
access to real and same demand information, and the data will
not be distorted by being transferred from one stop to another,
through the supply chain
 Process Integration - more companies outsource every functions,
except their core competencies, these kind of integration and
trust-based relationships become more crucial. Collaboration has
become the key word
 Network –It is important to empower all the parties in the supply
chain, and applying better relationship management, structure
and co-ordination

29. Challenges Today
 The main challenges facing manufacturing companies, both now
and increasingly in the future are:
 increasing competition,
 changing relationships with business stakeholders,
 increasingly demanding customers
 growth in new technology
 global distribution of design and production
 environmental legislation
 political and economic factors.
Manufacturing companies need to respond in the following ways:
 be more responsive to changing markets
 be more customer focused
 be adaptable to new situations
 form alliances and partnerships
 manage the strategic supply chain
 minimize the time-to-market of new products
 utilize the developing technologies for global communication

30. Future of Supply Chain
 Business Performance Consulting:
Business Performance Consulting services to
continuously monitor and review the overall
performance of the business operations,
processes, and results against set standards
and metrics. Assist customers to keep track
of their long-term and short-term operational
goals, both quantitatively and qualitatively.

31. Corporate Performance Management
Key Methodologies
Balanced Scorecard
Six Sigma, EFQM
EVA, Intangible
Asset Management
Activity based
Costing /
Management
Benchmarking
Key Technologies
Point Solutions, CPM
Suites
Data Warehousing
Business Intelligence
Dashboards &
Scorecards

32. Process Consulting
 Business Process Consulting services include BPR, Package
Assessment and Remediation, CRM processes and Supply
Chain processes.
 Business Process Re-engineering (BPR) Services
Business Process Re-engineering services focus on these areas
and strive to achieve a radical improvement by using
comprehensive process analysis and redesign techniques.
 Assessment and Diagnostics
 Transformation and Innovation
Change Management is an integral part of this methodology.

33. Business Process Re-engineering Methodology

34. Drivers for Supply Chain Change

35. Key Measures for success
 A ‘transparent’ supply chain in which information is made
visible across your organization, and to appropriate
partners, to enable better planning and resource allocation
 Procurement sourcing strategies and systems that create
lower acquisition costs
 Demand planning and sales-and-order processes for
better forecasting, loading and delivery performance
 Lean strategies for asset and inventory optimization
 Supplier and customer relationship management strategies
to sustain the trading network and improve purchase-to-
payment management
 Green initiatives to ensure the cost effectiveness,
regulatory compliance and corporate credibility of the
supply network
 Risk management and contingency strategies to ensure
that your supply network never lets you down

36. Cost of Logistics Today

37. THANK - YOU