Logistics & Supply Chain Management

Well, hello everyone, I hope you can see my screen well and I hope you can see my video. Well, good morning everyone. This is Manishi Rakibi. I'll give you my quick introduction. Unfortunately, we're in a Set that up where I can talk and you all can listen, but that's okay, hopefully, we'll be able to introduce ourselves some day later, so I'll start with my introduction today, so today I'll cover the topic which is the

management

of the

supply

chain

. and

logistics

management

. I have a total of six to seven years of work experience in the industry.

My six years of work experience is purely manufacturing and automotive related work experience in manufacturing field mainly. I am currently working at Procter and Gamble as a senior media. Purchasing Manager, I handle digital media buying for all Procter and Gamble products, going back to my experience and background in the manufacturing and automotive sector. I am really passionate about this field and have led many seminars and many conferences on these particular topics. I did my operations management from sibm and that is the reason why today I am going to cover this topic which is very close to my heart and this is something that I implemented while working in comments india limited ah also while working in tata Motors I come with experience with these two companies and I am very fortunate to be a part of these companies and they are very close to my heart so I hope we are ready to go.

I'm just one or two disclaimers I want. to give you everything today, as you know, today's topic is a very broad topic, it is absolutely impossible to cover everything under

supply

chain

management, but then why are we discussing today? The main intention of having this particular webinar is what are the important concepts in supply chain management how these things are seen in the industry how things are expected of anyone working in any industry, not just the manufacturing but in any type of industry and how supply chain and

logistics

are applied in that particular field what are the expectations of anyone who is working in this particular field.

My only intention in putting these slides together and providing this session to all of you is to help you in some other way understand the nitty gritty details of these domains to understand how the industry views this. Domain in particular and what the expectations are. I would do my best to live up to your expectations. We can go to the next slide. Well, I'm not sure. Those who attended my webinar in the last week know me. I always start with the code, so today I'm going to start with the Albert Einstein quote. We strive not to be a success but to be valuable.

We always tend to define what our success criterion is in any field and the success criterion is. usually delivering the right product until delivering the product to the consumer or making our product available in the market correctly and what we do more or less in all industries, be it in service weight, in any manufacturing industry of products, but how then this success is different from value and that is something that we will see today if the product is delivered at the right cost at the right time and if we are able to maintain the satisfaction of our customers, then we are creating value in the industry and that's the reason why I really wanted To start with this code because all the supply that has supply chain management in place is nothing more than we strive to create the value, let's move on to the next slide, okay, and then comes the barrage of quotes and believe me this is the last one so this quote is very important.

I always include this in my slides because what Steve Jobs talks about is that his most favorite things in life don't actually cost him anything because the most precious thing we all have is time. Now I have taken this out. An hour for all of you to help them in some other way to help them understand what the important concepts are in supply chain management and logistics management. My request is that you take this hour for yourselves. I can bet this will help you, please put away all electronic devices from your cell phones. I'm also putting my own cell phone on airplane mode because I don't want any hassle and I hope you'll also respect your own time and mine.

Well, let's move on to the next slide. So what's the goal for the next 40 minutes? I always start with this and it's very important for us to understand what we're going to talk about, so naturally we're going to understand what it is. The next one, yes, let's understand what supply chain management is, what is the role of inventory management in the supply chain, what is logistics management in the supply chain and, in general, how you see overall success in the supply chain, why? I am talking about inventory and why I am talking about logistics because you will know very soon, but the most important point to understand is that the supply chain is empty without having inventory management and without having logistics management. now let's do a quick reality check, where are we today, what is the situation around us today, so we are in a povid 19 situation, we are actually realizing the impact of kobe 19 in India and in generally, in the industry, so there are various fields that have been affected due to Kobe 19 and the type of things that we generally hear from friends and colleagues is that the industry is facing a slack and we put a direct correlation to that with the loss of jobs, which I firmly believe is not the case.

The real scenario many of you may not agree with me or may differ with this particular statement but hear me out well so we are in a situation that is as bad as the effects of World War II in many reports. I have found that they have described that this is the exact situation and the exact downturn in the economy that the world faced at the time of World War II and at the time of the great recession, which is the period 2008 2009, what did our what did he do? Our elders do what all the people did when they faced all these problems during World War II or the great recession of 2008.

They tried hard, they put the right strategy, they put the right processes and they did it well, they made few inventions. such that their existing problem was solved while improving the overall quality of their production. A fantastic example of this is the Toyota production system right and what I'm trying to say is that we need another tai who is the master and the brain of this whole system, this whole quality system, those who are learning operations management , everyone should know everything, every part of the Toyota production system, you can talk about a particular part of manufacturing or production, but believe me, the thinking process is something that you can apply anywhere if, even if you are in the HR domain, you can still apply the thought process, not exactly the one that you know physically that you won't have products, but the thoughts you can definitely reapply, so in a nutshell, I think we should, we should definitely look at the situation. as the biggest opportunity that has been created because the industry is looking for the talent that will help companies come out of this situation and only we can help the industry if we have the right knowledge in the right domain in any manufacturing. industry knowledge about operations management quality knowledge about this entire effective production system knowledge about how to minimize losses is very necessary right now because we are already at loss and we really can't afford to produce any particular product that consist of multiple losses at multiple joints like supply chain lab date at inventory level whether at warehouse level or bhd logistics level so I hope you can now understand why we are talking today.

I hope you can understand why it is so important to understand where we are. are today like the situation of the pact and the impact on your respective industry and what is needed even if you have a job today, so today I am considering the total number of years of experience of everyone as an average of five years of experience, which means you are already working well, many of you, most of you, even if you are in your current jobs, you must have seen that they are calling people to work at a capacity of 10 to 20, it is up to you how you are going to define and show management that you are an important resource that they can't afford to miss because you are going to help the organization in such a way that no one else can do it well and everyone can choose their own field of interest and master that field, so I'm going to help.

All of you today, what do all the things and facts mean in supply chain management? And see if that interests you, you can continue to get more detailed learning about this particular field and then you can choose where to become a teacher, okay, let's move on to the next one. slide, so this is just a visual representation that I created. Normally I do, I try to simplify the general concept and it will also help you understand where exactly this is placed because the textbook definitions are available anyway. I'm not going to talk too much about that, I'm going to tell you where exactly does supply chain management or logistics fit into the industry, where it fits is to create any particular product, you need the raw materials, the basic infrastructure. , whenever. manufacturing of the product begins and then you deliver that product to your customer, so the block that is highlighted in the red dotted circle is nothing more than talking about where the supply chain and the circle and the logistics network are located.

Let's move on to the next slide, so this slide which is only shown on the right and you should refer to that slide and you should always remember that slide because that particular flowchart is equivalent to the entire operations management that we do in the industry. Now let's look at the definition of supply chain management. There are multiple definitions. of supply chain management and I've chosen one that covers the most important key aspects: that's what supply chain is right, so just to start off on a note, uh, to cover everything and just to cover, just to ensure that we cover all supplies.

Chain management is the set of activities carried out by any organization and to efficiently integrate supplies it is very important, the manufacturers, the warehouses, the stores that we have internally or externally, so that this in general throughout this entire process help produce a product or any commodity and it is being distributed in the right quantities at the right place and at the right time, so this is the most important part that I have highlighted in blue, why and what is the intention to have This whole system in place is to minimize the system. extensive costs and satisfaction of the service level of the required requirements, those that come from our clients in any situation in operations management, the intention is always to reduce the cost required to deliver a product, be it service, be it real product based manufacturing. did anything, be it id industry, also be it any website, if you are creating a particular website, what is your intention?

If your intention is to create that website at the lowest possible cost and that's what this whole definition is about now while making the website, your supply chain may look very different than what I've mapped out here. This supply chain mainly refers to manufacturing industry operations, but as I said before, you can replicate this for any type of industry because without supply chain and logistics it is just an incomplete process. That's right, and now what this slide is talking about is what is the correct flow of your raw material coming to your plant, so you flow your raw material from your supplier's side to your own site, your flow internal material directly from your probably warehouse inventory. through your production line, this is also one of the transits through which the material, final product, manufacturers passes, so in any case, we are talking about any manufacturer, when the final product is manufactured, how it flows the product into the system, this is all we are going to do. to see in a lot of detail so I'm not going to spend any more time on this slide so let's move on to the next one great so I really like this slide because it covers the essence of supply chain management.

The most important milestones in supply chain management are highlighted in materials planning without planning circles, so I hope that if any of you attended the last seminar you remember that this is something I covered in operations management , also strategy, forecasting are the most important pillars of operations management andin this and now the supply chain. management is nothing, it is an important integral part of general operations management, there are few courses there, now they have changed the name not only to operations management, operations management and supply chain management, because these two things They go hand in hand, so material planning is something that The planning phase is really important because if your forecast is not correct, what you are going to do, you will end up buying more raw material products or you will end up not buying the raw material. required correctly and involves risk for either party, acquisition and integration, so acquisition could be anything, acquisition of raw materials, basic direct indirect acquisition are the two types, sometimes services are acquired , sometimes the actual raw materials, parts and goods needed are procured.

To make your end product warehouse and fulfillment warehouse again, I'll cover this later, but again it's the most important point. Right distribution now in distribution, distribution basically talks more about the logistics part of supply chain management and repairs and returns. The space where no one wants to do repairs and returns is something we should all aim for and avoid, but that particular obstacle is still there because that is the right fact to eliminate repairs and returns altogether. The Six Sigma process is the solution for that and many industries are moving towards this, many industries are already hiring Six Sigma experts so the last part that talks about repairs and returns is that they can eliminate it completely, it should at least be as small, so insignificant that it does not. has some impact on the overall profits of that particular industry, so coming back to supply chain management, this is not the only blog that you know and this is not the process that once the planning is done , acquisition is not a linear process, it is a yes-can-do process. see the arrows, it is a circular process, each block has the full potential to impact the operations of the next block or the previous block which we are going to cover in the next few slides.

The most important thing I want everyone to focus on is the flow of material or value that I have indicated on this particular slide, if you see that the forward flow is indicated on the green arrows, the most important thing is that you also remember that The flow of value-added services always goes towards the consumer. The flow of materials always goes towards the consumer, but the flow when the material is delivered to the customer and if there is going to be some kind of returns, then the flow is exactly the reverse flow, which is the flow of returns and what else comes in exchange for the manufacturer, let's imagine if we are a manufacturer of water bottles, let's take this example and around this example I am going to explain many concepts to you, so we are manufacturing water bottles today while I manufacture water bottles, my and that particular product have gone through the entire supply chain. now it is delivered to the consumer but if the consumer decides to return that particular product then it comes in reverse manner.

It was agreed what else happens, so if the product is delivered, I understand that my sales executive understands that it is in a particular area in a particular state or country, this brand, man, this brand's water bottles have greater demand and somewhere else, in some other region, there is less demand, there is almost zero demand, so at the regional level you get to know what the demand is, there is a specific unit that exists to communicate. The supply chain demand in general, the block that any industry has, has a reason because if we are not aware of the demand available in the market, we would overproduce the goods, probably the demand will be very less. but we will end up overproducing the goods or we will end up not meeting the demand, so it is necessary to understand what the ideal speed of our production should be in order to understand what the right amount of raw materials that I need to store should be. until I meet my demand to meet my production requirements third thing how much to produce it is still okay to have it sometimes we have extra stock in our inventory but we decide not to produce this can also happen because there are sudden spikes in demands positive peak and negative peak just as we are in this situation right Kobit 19 situation take any example ah water bottles so yeah there is a spike in some areas where people think you know just to keep our immunity well we want to ask for water which It is refined water and that is why they are asking for bottles of water, but there is one region in particular where tourism is completely non-existent and therefore demand has decreased dramatically.

Let's take any other community example. In such a situation, the manufacturers are taking the decision to discontinue. your production, it's still okay to have that inventory, but it's not at all okay to have losses making the product and then keeping it in inventory, the losses are much higher, that's why and my focus on demand flow is a lot because there are There are exports in the industry that are specialized in understanding and analyzing market demand. There is a forecasting equipment that is available in the market. The forecasting equipment first of all helps to understand what is the relationship between the demand and supply of water.

What is all the raw material. necessary basis demand the forecast sheet is prepared and according to that the inventory is managed according to that the logistical provisions are made according to our demand analysis our entire supply chain decides its own work strategy any information flow the information flow is anyway what we just did what I talked about is basically understanding the information base, basically collecting the information, one has to collect the right information that is required for the supply chain domain of your organization in particular, and this is where I see a lot of opportunities currently in the industry because this is the most The critical area industry does not want to invest a single cent that is not higher than expected.

This completely depends on the analysis of supply and demand. This could be a field, if this interests you, you should go ahead and research this field. let's move on to the next slide, so this is something that I have prepared for all of you. I'm not sure if you'll find this anywhere online because I created this. I always like to see everything that is included in a particular topic or topic, so in the last seminar we covered all the milestones that we have when it comes to operations management, today we are going to talk about what the milestones or the important domains that we have when it comes to the supply chain. management of a lot of things that we covered in the previous slide, but I'll still go over them, so the materials planning that we saw, procurement and integration, warehouse inventory management, I've called it as a different block because there are ups and downs in inventory now and in any ups and downs in the inventory strategy will actually lead to losses distribution now distribution and logistics, so distribution also consists of general distribution networks distribution modes, I mention logistics as a separate milestone because logistics comes with many challenges. different types of logistics that a particular rate a particular manufacturer prefers depending on the commodity depending on whether it is a service domain then the entire logistics chain and cycle looks very different.

The most important thing we need to focus on in logistics is any changes. in logistics or any wrong strategy that is combined while running logistics is directly impacting your profits just like inventory management and that is the reason why I am going to talk about these two blocks today and in the respective areas what are the important facts and terminologies. that one should be aware that one should actually be well informed. I have covered all these points just below each of the milestones in this entire process, so to simplify this overall supply chain management process, first comes the basics. planning, forecasting.

What is the basis of all planning from start to finish? If I'm going to produce a certain amount of products for that, how much raw material is required, how much buffer space do I need to conserve, all the services I'm going to need throughout this process, forecasting everything. From this and making a correct plan with the help of project management experts is considered a part of planning, now it is very specific for material planning. There is mrp, which is material requirements planning done in industry. This is the most important field that I am not going to talk about. a lot in detail because the knowledge about it is widely available in any course or online.

You can also gain more knowledge about it now. Acquisition and integration. The most important. Enterprise resource planning erp. Enterprise resource planning is what you can say is technology and. the tool available in the market to integrate the demands of each of your internal functions to have a platform to have a common platform where the portfolio of all services or product or raw material requirements are listed on a common platform and created for A particular industry bases its own requirements, this is generally called enterprise resource planning. I have simplified it a lot, but it also has its benefits, it also has corresponding risks and one should review it if they work in supply.

Chain management must know everything about the erp system. There are different erps and services. ERP is provided by different industries. There are different products available. Each manufacturing unit chooses to decide any one of them, so I think there are many available. a cisco product there is a product from many developers and it completely depends on you what is the scale of your industry and whether it is required or not because it is an investment right, keep this in mind, any use of technology is highly recommended when you are into supply chain management and if you want effective supply chain management.

The use of technology is highly recommended. Technological integration. The automation of digitization. We definitely want to minimize errors, but at the same time it is necessary to understand to what extent. It is going to cost you because this is also an important factor because if you invest everything in your supply chain management, what benefit will you get? Then you need to find ways to make your supply chain effective, it could be by hiring talented people. You can still make the supply chain very effective without a minimum of software available, that is also possible, it completely depends on the scale of the industry you are in, then comes the correct warehouse management, it is very important to know the warehouse management because warehouse is something that you can have created an industry much closer to your own industry, you need to know what are all the warehouse facilities that you are going to use while shipping your material to the consumer or in case there are any return, so how are you going to take advantage of this? particular facility because this comes with the cost in warehouse management also if you are in an industry that only does warehouse management oh my god then this is the milestone for you then you forget about everything else you just focus on this milestone in particular because then you need to know how the design is done how the shelves are handled what are what are the typical measurements of the shelves what are the typical drags which are available in the market what are the different warehouse requirements If you are specialized in providing services to perishable products, then the warehouse requirements are all different.

We look like you. I hope you understand how I am covering each of the milestones. I hope you understand its depth. It is not a simple process. Let's say, okay, supply chain management and here is the definition, this consists of materials planning, procurement, warehouse logistics and one important word, it is not at all that simple, each milestone has tremendous depth, there is a lot to learn at each and every milestone and therefore I urge you to select your own domain of expertise, whatever interests you, make efforts to master it as if someone is very interested in the domain of warehouse, someone is very interested in starting their own business to provide warehouse services to all these big manufacturers, absolutely yes. you can totally do it, but there are a few things you need to know right: storage strategy is something that needs to be at the top of your mind and that's something you need to know now, moving into inventory management, what will I do?

Anyway, I'll quickly go to inventory management in the next few slides and we'll cover everything that's listed there. Today I am covering thehighlights of inventory management and then we'll go to logistics on the next slide please, yes. Before we get into inventory management, I'll quickly tell you that this is a graphical representation of how interactions occur in supply chain management. If we follow the linear flow, it will never work correctly. In supply chain management, all departments in some. or another way they tend to interact with each other and this is the diagram where I have shown all the interaction that usually occurs in any supply chain management domain of any industry, there are some essential characteristics, uh, and I think the most important characteristic It is communication to have integrated behavior within the teams those who are working under the supply chain it does not happen, it does not work this logistics team says okay, we are logistics, we are not going to interact with the inventory team or we are not going to interact with the production team, every entire system is going to crash, communication is very necessary, that is the reason why the flow, the arrows that I have shown in the previous slides are important because it is very important to keep the information flowing from beginning to end.

From start to finish, in any way, share information with each other. I just covered the risk and rewards of the mutual sharing channel. Yes, this is very important because if a particular small subset of your supply chain is at risk, then we need to balance it with some other domain. for example, let's say our logistics is at risk, then conversely, we can understand that it is okay if the logistics domain is not working and there are certain risks that we are saying roadblocks, sudden things happening in our environment today in day there are roadblocks, there are, let's say, riots, it could be anything, right, heavy rain, the roads are blocked, so the first thing you do is change, you try to change your logistical strategy, you try to change the mix, but the next thing is at the same time signaling all this risk to all your internal departments, that okay, we're not going to market, it could also slow down the process.production or it could also, sometimes, if it's going to have a big impact, it could also stop the production, these are very, very crucial decisions, they are basically taking information that your logistics team will share with the corresponding internal teams and focus on serving customers.

The right approach is not just the company, no, it's not just that the CEOs and CEOs of the company care a lot about our customers' satisfaction or serving our customers in the right way at the right time, no, It is the responsibility of each individual. You know I'm not going to talk a lot, I'm talking a lot about theory because this topic is really important, but try to understand that you have this domain knowledge and you have this sense of responsibility to yourself, like you just have to think that if I get assigned a particular task for how long it will remain on my table.

If I am efficient today. I can immediately extrapolate all the points and say that my company is efficient today. It starts with you. If you don't have the right approach, then. you are attracting all the problems of the industry to yourself if you are not you, if you do not have the right values ​​that the quote I covered at the beginning, if you do not have the right values ​​and if you do not have the right intention, then you risk losing work you are definitely attracting the risk of not developing at work you are definitely attracting the risk of not having a great career ahead of you you are definitely attracting that if you know for sure that you are giving your 100 is I just compare it to happiness, I just compare it with work life balance and dissatisfaction and once you have satisfaction everything else falls into place, you don't really have to worry about where the environment is going and where the industry is going because if we're not there if we are people pleasers with great intention and great dedication if people like us aren't there anyway the industry isn't going to do well so I don't do it so I don't see there being any concern about jobs and loss Jobs for those who are looking for a job, if you are very intentional and very dedicated to your own career and if you are very passionate about the job, you are an expert in places in the industry that probably not in the first, probably not in the next.

The second probably won't go to the third as well, but probably on the fifth goal someone somewhere will notice because believe me, there are fewer people in the industry who come with great values, great dedication and passion for the work. Next slide please, so I'm just calling. Outside of the overall supply chain risk, I'm going to focus on the first two risks, inventory, and the second risk, logistics, and so we're going to talk about that if you're going to get the presentation anyway so you can move on. this. all the risks are listed because it is important that you know all the risks in the next slide please okay again what are the objectives of supply chain management?

I think we've covered them very well. I have covered this while explaining everything important to you. milestones in the supply chain so we can move on to the next slide yes, now let's go to inventory, so why do we need inventory in the first place? It's as simple as we need sugar if we are making tea. just go downstairs and get the sugar or we just ask for sugar for honey or danzo, why can't we do the same? Why can't we do it? To tell you frankly, even my mother, so I learned the inventory from my mother, then what?

What she does is make a list of the items she will need for, say, three months. She makes a list. One day she stores everything and we are organized for the next three months. This is something I learned from my childhood and this. It's something I see in the industry as well, but there's a slight difference between sourcing and having inventory and managing this particular inventory right now. It depends a lot on the demand in the market. The shortest product life cycle is something we call any item that is in our inventory or in our product production line.

Our intention is to get rid of that item as soon as possible. Getting rid of that doesn't mean throwing it in the trash, but sending it to the next milestone, which is our logistics, and then making sure that it reaches the consumer at this time, why inventory is needed, because there are times when there is uncertainty in the supplies, so you can't really predict what risk may arise in your backward supply chain, which is like you and behind, meaning your supplier, your supply supplier and the logistics and warehouses in between, so this is called backward supply chain you can say or um and in that particular chain you can't really predict what kind of stop losses may come into the picture so to eliminate that risk we tend to have inventory space in our organization or in the rights of our manufacturing plant and that is why it is necessary, so we are convinced that we need inventory.

Now let's focus on why this is a hassle. Point and why we need inventory management experts. Why do we need people who know the nitty-gritty and are very adept at managing this inventory? Let's move on to the next slide. Yes, what are the types of inventory that we all know? The material and purchasing part are the main import thing that we all are aware of. Well, partially finished products. This is something we really want to discourage, hence products in progress. Ideally what experts say about this particular piece is that it is a work in progress. The elements should not exist in any organization, because they say that your process must be so strict and you must be aware of your process in such detail that you know that from union a to union b they try to make you know the transit of your raw material. material until the moment we do the final work, well finished, you must know it in such detail that there should be no waiting time, zero waiting time between the joints and when there is zero waiting time between the joints, the work in product in progress, the need to put this product in progress on a shelf, the need to have the shelf somewhere between the seams is completely eliminated, so this is the ideal situation that we want to be in, but yeah, a Sometimes there are partially produced products available, huh. with us in our inventory domain, finished goods again, this we also want to eliminate, so the ideal situation is that we know the demand, we are producing exactly the same quantity and we are delivering that quantity without delays, without stops and without things like that, so our logistics.

It must be so efficient that the moment our products are produced, they are immediately sent back to the right place. This is the ideal stage. We have industry experts who are working and who are putting a lot of effort to achieve this ideal state, but this is what is expected is the replacement of parts and tools and this again, so we receive the material, we do the quality control and the raw material that we understand well, in a batch of hundreds there are like five or ten that do not meet the requirements and these are returns, so we must return this to the supplier again.

We need another different space allocated for this particular one in the inventory, which is a type of return inventory again. We want to avoid this so you know that this is a very important point. I'm just connecting the dots and I'm just trying to tell you how the internal subdomains interact with each other right now, so now this is feedback that the inventory department or the quality control expert who is checking the raw material should give you to the purchasing department so that we can make sure or we can add a particular clause that says that if the percentage of defective products is greater than certain, let's say it is more than one percent, then you will pay the penalty that could be.

It's all good, but at least we can take some corrective measures and we can also take preventative action so that we don't fall into a situation where we have to manage the inventory, which is just the replacements or what is the only defective part that we have. receive from the consumer, sorry, from the supply. The same thing happens when we receive the parts from our consumer, the returns, the correct quality products, we want to avoid both, so the first part about this incorrect raw material that we receive from the supplier is very important that our internal domains interact with each other.

The most important point is that that is why purchasing and the organization have their vision, they have their requirements and quality measures established so that they only partner with those types of suppliers. they are equivalent in maintaining the right quality and the goods and the transit basically the warehouses, so this is generally what type of inventory we have. Let's move on to the next slide, so these are the functions of inventory to meet demand and everything. We have covered all of this. Inventory turnover is part of the cost of goods sold. The final goods we sold at the average investment in inventory.

Imagine when we say we have a pathetic inventory turnover rate. What does it mean that the denominator is so lower than the total? turn, sorry, sorry, the denominator is so high, the turnover is extremely low, so basically the cost of the good that we actually sell must be very, very, very high and the amount we invest in our inventory must be very , very low, so that should be the ideal situation. right on the next slide, yes, there are some techniques that are widely followed in the industry to do effective inventory management. The ABC classification is widely known but it is not used much these days because these days we are looking towards the future, the digitalization of the entire space, but still it is extremely important to know that we are making decision bases, what is our type of raw material or the goods of the product that we are storing in the inventory, which ones are type b and which one is type c and the basis on which we decide. the right quantity and right allocation of space while doing inventory management, next slide, yes this is the most important concept and a jargon in the industry which is economic order quantity, one should know what is that, what is that number that is going to be effective in what is the number of inventory that I have to maintain so that it gives me profitability and what is also the quantity that is very necessary to make sure that my production is up and running to make sure that I am complying, if I do it.

If there is a positive spike, high and sudden demand, then my demand is also satisfied, and if there is low and sudden demand, then I also have such an amount of inventory that I do not take much risk. Invent that having inventory implies the availability ofspace and availability of resources to maintain that inventory if while some particular raw material or product is there in the inventory section and there the product gets damaged or the raw material gets damaged like rust, this is the worst loss , so this is the worst place to be. No service domain or manufacturing domain wants to be in a space where their inventory is damaged simply by poor inventory storage practices.

This is extremely important for perishable items. For perishable items, inventory requirements are such that the manufacturing industry. or the inventory spaces have to have very special conditioned inventory spaces, directly the warehouses, we can say, so it is really important how much you are going to invest in your infrastructure and how you are going to take care of the infrastructure to avoid losses when storing inventory next slide what is logistics management so we have covered everything important that is related to inventory management let's move on to logistics management logistics is basically the art and science of getting produce distributing the product in the right way placing in at the right time and in the right quantities, if any of this goes wrong, it will directly affect our internal process or it will affect our customers correctly or basically customer satisfaction.

Logistics is the most integral part of supply chain management for many. People get confused about whether it is losses, whether to call material transportation as logistics or as supply chain, make it very clear in your mind that supply chain management is the entire domain in the sense that Logistics management is a subset that is definitely The most important subset of supply chain management on which this logistics is based mainly focuses on the planning, implementation and control of the entire transit of goods. Let's move on to the next slide. Seven hours of logistics. I really like this slide because at a glance you can really see what logistics means that we want, we want to deliver the right product in the right quantity in the right conditions, this is the most important thing, we see, we have seen examples of this, there are many service industries available in the market and the right condition is the most important thing, the right place, at the right time, for the right customer and at the right price, this is the crux of logistics in these seven hours, if you know the seven hours, you know all the logistics, you can You can't go wrong at any time because you know what the seven important factors are when it comes to logistics, in the next slide yes, so we will go into a little bit of detail regarding each and every one of them. the pillars.

Very sorry. We're a little behind on time, but I hope everyone's okay to extend it by just five to ten minutes, that would be really cool, and I hope this session goes well, I hope it's interesting, I'm so sorry, I can't. interact, but I hope you're enjoying it and I hope you're taking notes about it now. The important sections in logistics management. Important functions. The pillars are transportation and storage. Third-party and four-party logistics. Reverse logistics, which is what we will focus on today. uh we areI'm going to talk a little bit about all four and you'll also see this slide so I've listed the most important aspects of each of them so reverse logistics is pretty simple and deals primarily with recycling, reusing the returns because there are Today, the packaging material is recyclable.

You see a notice there stating that it is recyclable material. Please return it if you have a lot of these, if you want you can definitely use the egg packets they come with. You can definitely return those egg packages for recycling, likewise our most important pillar of logistics. It is the right of transportation there are modes of transportation each mode of transportation has its own rules there are rules set by the government that one must know who is in the transportation part of the logistics of course it goes without saying that this is the part most important of logistics management um, so what happens is that whenever we want to transport a particular material from point a to point b, it is not an obligation that we use only road transport or only air transport, our logistics strategy is very important because there we decide that considering the place where we want to deliver the good considering that particular place what is the most effective way to transport our material it could be a combination of two three modes of transport storage we talk a lot about it storage is nothing more than during transit if we have to change every time we want to change the mode of transport or if we want to change the route to a different route or generally warehouses are considered in transit uh storage places from where retailers pick up the material or the distribution plan changes or the material is then distributed in different different places the logistics of a third party and a fourth is nothing more than the service provider.

Here we are going to talk about what are the different service providers that are available in the market to do the execution process. A little bit of logistics, so a third party is something from our own manufacturing unit, we are choosing a particular third party, we tell them okay this will be the route, we tell them this will be the mode of transportation and so Please, transportation. this material to location b from here to the expected location, but what is different in third party logistics is that we simply give them the material, we simply tell them that from here, from point a to point b, we want to transport this material and We pay a certain amount. deliver to provide this service to third party logistics what they do is they strategize for us, they prepare a plan for us, they select the right warehouses and then, of course, since we trust them for this particular service, any risk in all this Then transportation is shared or wholly owned by third party logistics and there are many services available in the market.

If any of you are planning to start your business exclusively with a third-party logistics service, it is a huge domain in which there is no end. There is no end to this particular domain, there are many opportunities that you can actually create your own business to serve a large manufacturing organization just to take care of their entire logistics network and we, reverse logistics, is something we talk about. on the next slide super, so this is a value proposition that one must always know that there must be a proper balance between this service and the cost that you pay for the service because you cannot compromise on the service because that will affect your customer. satisfaction, at the same time you cannot pay a huge amount to get that service because ultimately it is your right investment, your investment should not be more than the profits you make, you will be in the negative zone, refer to understanding the business terminologies and the correlation of each and every loss with the in relation to the impact that this is going to cost on the profits is very important it is very important to have frequent interactions with the great managers it is important to have interactions with the leaders of your company leaders in your industry gives you perspective helps you understand how this industry works helps you understand how am I contributing to the goodwill of the companies how am I contributing to the overall profits of the companies it is very important to know this if you don't know or If you are not impacting or doing anything that adds value to the well-being of the companies or the profits of the companies, then create that value for yourself, be an expert in any of these domains because it is very important that any work you do, regardless of the efforts that you put in, can positively impact the organization's profits or well-being or the correct practices that are followed next, the next slide, that is, at a glance, what are the objectives and what are they? the strategies that are followed in logistics, as I said, it is very important to understand objectives, whether it is your personal life, better professional life and whether it is your business, how you need objectives, so the most important objective is customer satisfaction and we have already seen the seven hours, so it is very much related to that quality is, to the most important extent, obtain There is a high potential for quality to be affected at any stage of logistics due to poor handling, to poor service, poor packaging, poor means of transportation, therefore compromising the quality of the vehicle used for transportation. any perishable item just to save on transportation cost if instead of transporting it in a temperature controlled vehicle, if we transport it in any normal vehicle, what will happen will affect the quality of your product, invite unnecessary devaluation of the image of your brand devaluation of the value of your brand the evaluation of the reduction of faith the consumer will no longer have faith in your service or your product now to avoid that area what are the strategies basically listed, so let's move to the next slide Yes, effective losses, one of the effective logistics strategies that I am going to focus on is the use of information, but at the beginning, as I said, it is very important to know to what extent I am going to invest.

In information technology or automation, there are several ways we can use information, so one is to improve communication. What you can do is establish a channel where all of your internal or logistics departments can all talk to the warehouse. with whatever mode of transportation is happening, your reverse or return logistics you have to talk to the warehouse or the point of departure to establish communication, collaborate with suppliers, it's not always like that if everyone I'm sitting now. I am currently located in Mumbai. Do you know what is the most precious thing in Mumbai? The space, the jaga, like the space that is available for your own business, we are facing a huge shortage of spaces.

Now imagine if we decided that each manufacturer. They will have their own space. They will have their own warehouses. Each supplier will have their own. Is it humanly possible? will they be able to then stay in the heart of the city and then um and then have their own warehouse their own inventory spaces their own? uh logistics department spaces all their vehicles spaces no, not at all, it's not possible, right, so what you have to do here, you can collaborate with your suppliers in such a way that you integrate your strategies, you integrate your processes in such a way. in such a way that you are focusing a lot on your continuous improvement at the same time that you are sharing observations of trends, you are sharing your observations on demand, you are making very important strategic decisions like making warehouses common or making services larger logistics services become common, which will help us both, so imagine a supplier and a manufacturer link up with a logistics service, then they see the service from the supplier to the manufacturer and then the manufacturer is completely sorted, Don't you see the efficiency?

Do you keep inventory in transit? Again, allocating much more space than required just to store your inventory is an absolutely wrong technique and tactic that we have already seen, which is why experts highly recommend keeping this inventory more in transit for obvious reasons because it reduces a lot of cost, it reduces a lot of amount of investment needed. She makes shipments that we already saw, which makes the shipments necessary in such a way that the effective logistics cost is minimal and you don't wait in line at customs, so you need it. to know what documentation is needed, you need to know the changing government laws, you need to know the changing government regulations, lists of dos and don'ts that are widely available, so this is also one of the areas where You can be an expert and you can contribute from your part that you can assure the manufacturer or the industry that if they give me this responsibility I will keep the information so updated that any product in transit or any product that is about to be shipped meets all the requirements , go ahead with all the necessary documentation so that there is no loss of time or cost today, so you know, I hope you know at customs also if your material is there, present. there more than 24 hours and if you don't provide the required documents or authorization is not done then they start charging you by hour or by day it depends on the size of your material and what finally happens you are losing. money, so now you understand warehousing strategy, your logistics strategy and your inventory strategy should go hand in hand.

All these rules must be known by each of the experts in that particular domain. There has to be a constant interaction, a flow of information throughout the supply. next slide in the chain,yeah, so risk pooling is something we talk about, that's what you call it, this is again a very good strategy that is widely implemented in the industry, what it does is it basically reduces the cost of storage and it reduces the uh, it reduces the stockouts, so What happens is, you simply give them a minute to reduce stockouts, they are completely available in the industry and what this is basically is that if you use, you place the material in the centralized location and these are the ties that they are made. with other similar manufacturers who make similar products or mainly this is done by retailers because when there is a high demand they only want to order this material from the warehouse, so what they do is end up sharing the warehouse so they can make profits on the next slide, please Yes, as I told you before, many of us get confused between logistics management and supply chain management.

I hope I was able to tell you how different they are from each other and what the logistics are like. integral part of supply chain management, these are the few points that I have listed for all of you, just for you to have a look at what is the difference between logistics and supply chain management in the next slide, yes, again, this mainly talks about the processes, on the next slide, yes. again, so thank you, thank you very much everyone for attending this particular webinar. I ask everyone to share their questions. Be available until I answer the questions.

I hope this session has been useful to all of you. I'm looking forward to it. See you all in the next sessions. Any career related questions, I would just spend the last two minutes talking about my experience in the supply chain and logistics domain and in the industry, so there were instances where you really have to take a very quick call. while you are ordering a certain material while you are storing a certain material, so I will give you an example of reverse logistics. There was calibration equipment in our test cell, so we were facing some problem.

In terms of measurement, now who provided the calibration service, our supplier is right and the supplier is located at a particular distance, so the first thing I did was to calculate the losses. This was Saturday, Saturday was my weekly rest. There are two others. people who are very dedicated to managing the calibration of the equipment, so one thing is that the most important thing, the first step we did is to identify what the problem is. The second thing is to ask ourselves if we can correct this if we can. Calibrate this on your instrument internally and if we can fix this so that our test cell starts working and those who understand or those who work in the environment of a Tesla type test facility, will understand how large the losses are when your test cell it's ideally down for an hour or two right now here we were talking about uh Tesla will be down for Saturday and Sunday because it's a weekly break.

A question I asked myself if I don't support today even this even if this is my weekly rest if I don't support today if I don't make a decision today what is the loss the loss is keeping the tesla idle for two full days in the three shifts absolutely not I'm going to take that loss in my head, the team is calibrated, I've delivered what I was supposed to deliver. My responsibility is to keep everything calibrated in the test cell, which I did, but there is still a problem. The next question I asked who is that person who is going to help me achieve it.

This instrument is calibrated by the supplier if I want to dismantle it and send it to the calibration center to the supplier the answer is logistics my logistics partner the importance of maintaining the relationship with everyone in the industry is very important the way I shared my interpersonal relationship with the supplier of logistics that supplier was supplier accepted my last minute request they accepted my request they accepted my request to do the documentation as quickly as possible I made sure I was doing the internal documentation as quickly as possible Saturday afternoon at 3 p.m., the team was sent to the location of the vendor that provides calibration services and guess what the weekly break is for the vendor as well and you know what when I realized that I realized when I got the first call in the In the morning I say this equipment us It's causing some problems.

The first thing I did was call the supplier to inform them that this equipment is causing problems with calibration. If necessary, I will send this equipment to you now. I don't want to hear that this is your weekly break because I am also working despite having a weekly break on a Saturday from 9am. in the morning until 3 p.m. in the afternoon, I made sure that the supplier is available and therefore as soon as my team was there at my supplier's site around 3:30 3 40 p.m. because it was in the same city immediately the supplier took it to be calibrated, rechecked the calibration, made the equipment right and sent it back to the test center our test center within an hour around 5 30 in the afternoon the equipment it was there in the air at the corresponding location and the tesl was against uh it started, it was up and running and fortunately we were able to see the correct results and the calibration was fine.

I'm not sure what you're going to take away as learning from this scenario, but I learned a lot, I was very proud of myself for making the right decision and taking the right steps when, especially when no one asked me to do it right, not a single time. Once I had to call my manager to ask him that. What needs to be done because we come, we come with a very rich experience. I am an instrumentation engineer. I know what the importance of calibration is at that time. I didn't have my operations management qualification with me, but even before that I understood what it's like. is going to impact the business, it is important to deliver and communicate the intensity of this failure to your subordinates also because there were one or two subordinates again, they were only there when they did not answer the call, but it is important to also tell them why it is important and that is the responsibility which falls on any manager available in the industry, since we could do all this teamwork together with our external partners, we could achieve this success.

I am going to end my session today with this note, I hope this whole session was useful for all of you. I hope the experience I shared has been useful to all of you. Now let's get to the questions. I'll see the questions, if we have any. I'm going to try to answer almost all of them. They tell how implementing AI and IoT can improve supply chain management. This is something we cover. This is more important to basically establish communication in this supply chain and to reduce communication time, what is the difference between global? supply chain and global values ​​and, my goodness, this is a very important question, so, then, there is a material available on that.

I'll try to share the link. There are some links that I have included in the presentation, but global ones that you can extrapolate. Whatever we learned a moment ago about the global supply chain because almost everything is the same, believe me when you understand the basics of the supply chain. What is the global supply chain? Basically, the supply chain is established in all countries. So there is the answer. Which is the? strategy that we must follow to achieve consumer demand and on which our strategy depends on which our supply chain management for the material manufacturing process depends, so the strategy differs from one industry to another.

Strategy is the most important thing that everyone should focus on and you should know the strategy because strategy implies what is the probable demand of the market. Strategy involves what is the best possible way to produce a material and deliver a material and that is why while we make strategy the most important thing we have. consider is the customer's requirement then that is the reason why we need a strategy, what should be our minimum inventory level in terms of percentage. Yes, there are formulas available. A very good question. A very, very good question. I'm not sure, in one line I can say it. you the calculation because there are formulas available for inventory management if you go to any portal, depending on your type of inventory, then, there, if you see the break-even point, the order quantity point that I talked about, then that is the That is one of the techniques to understand what percentage of inventory is needed for your own plant.

Definitely, if you are very interested in this particular inventory management topic, you should know the calculations. There are mathematical calculations available that are used in the industry. If any particular manufacturing unit is not using mathematics, any calculation to maintain their inventory, then they are definitely going wrong, there will be losses that they do not realize on the inventory, how much minimum stock of inventory again, I just answered that question, for so minimum inventory is something. that is the minimum order quantity, that is something we are very confident that by meeting the change in consumer demands, you should be able to meet that change in demands, if it is a positive change, you should be able to produce a large quantity if so. is a negative change, you should be able to control your inventory and store it effectively due to the negative increase in the demand method.

We have stored some inventory, but now the inventory is so much that we need more space to stock it, so this should never happen. What is the best way to achieve balance in supply chain management? The best way to achieve balance in supply chain management is to hire the right experts and the right resources who have domain knowledge. By doing this, you will be able to achieve balance in the supply chain. the technology will be there forever the practices the correct practices will be there forever, but having the right knowledge and resources is very important because they will be the ones who will implement the correct processes.

What innovation do you suggest for supply chain management or logistics in Kobe 19? Um scenario, look at the current innovation so great, a great example, so in logistics, first I will say just look at Swiggy's delivery system. Swiggy is nothing but the logistics they provide from any restaurant to your home. What did you do? What innovation did they bring? They brought the temperature measurement as soon as I placed the order, they show me the popup message, the temperature of a person who is preparing your food is regular, yes, as soon as my food is ready, another popup appears saying that the temperature of the person who is delivering whose name is so-and-so and uh whose body temperature is so-and-so what correct practices are you doing, so you wear gloves, you wear masks, so they mention this in the message when your food is delivered They say it is delivers food well and a person who received that food whose body temperature is so smart, they are not, they do not let the life of their employees be affected, what they do is that the delivery person measures the temperature of the person who receives it first , they measure the temperature if the temperature is beyond the limit, why put your own employees at risk?

True, they are also human, so this is the great example of innovation in logistics, true, this is an additional convenience service that they added in their logistics which provided convenience to the consumer and the consumer is very happy that everyone finds Swiggy sure because of all these reasons in a very logistical part, what they did is that the restaurants are not open, so they modified and probably reduced their uh their number of delivery drivers that are going to go, they reduce that percentage of vehicles that are going in a particular area that is reduced, how did they reduce that base?

The demand, their demand fell, of course, before the government 19 during Covet 19 and after Copenhagen there will be a big difference in demand, so they are reducing their resources, they are reducing their vehicles, their investments, at least they are saving fuel and all that stuff right, so they're doing all this. I hope I have answered the question, well, with the example, what is it? The difference between primary and secondary logistics again, so I mainly take this question as third party and fourth party logistics which we already covered, ABC analysis of inventory management, so this is something we couldn't cover in detail today, but check it out .

This mainly focuses on the categorization of your inventory, what is a category, what is b and what is c, depending on you decide that a category can be expensive, can be the most expensive inventory, could be the most valuable inventory or raw material necessary. what is the categorization done and the basis on which you decide where to store this inventory what is the care required to store the inventory what is the investment cost needed to store category a, category b and category c again,with a lot of detail, there is a lot of detail, there is already literature available again, this is not a class in which I can teach you the terms and terminologies, you can read it very well or very well, you can learn that in a class that everyone in the course offered by the mit, but I'm just trying to cover and help you understand that inventory management is not important, so you should at least know what type of technology management or software packages are used in supply chain management.

No, it is definitive, it is the same for Not all software requirements at all in supply chain management differ from one organization to another. Take any right example, so erp is needed for any manufacturing industry, however, erp is not needed in any service industry, erp is probably not needed in any hospitality industry. In any hospitality industry, i.e. travel and tourism, this is altogether a different industry where everything happens on the website, where there is a balance between human intervention of the Internet and technology, so supply chain management supply and the technology or software you choose differs from yours. type of industry, so it's definitely not one size fits all in terms of packaging requirements.

I think this focuses more on what type of packaging is needed, so yes, again it differs from the type of product you are trying to deliver and yes, great. So I tried to answer many questions for all the remaining questions. I will definitely share insights from my answers via email. You can contact me via email. I just want to wish you all the best. Please make the right decisions in your career and please make the right decisions while learning something or while personally following a particular person in the industry. I believe in this: Yes when you follow the right people, when you look for the right leaders in the industry, you can learn a lot just by observing them just by their work style, so make your decisions to identify who is that person who inspires you a lot .

Please follow that person on a very personal note. I just want to end with the saying: believe in yourself because if you know it and trust in your own abilities you will go places thank you very much thank you very much everyone