The purpose of this assignment is to identify and apply Operations and Supply Ch
ID: 470394 • Letter: T
Question
The purpose of this assignment is to identify and apply Operations and Supply Chain Management concepts/tools to solve operational problems and improve operational performance. To this purpose, you should find an interesting operational problem from the real business world and think about how you can apply the concepts/tools that you learned in this course to solve the problem. More specifically, each individual should: · Find an operational problem from the real business world (from his/her own work or from any company) · Identify specific Operations and Supply Chain Management concepts/tools that can be applied to the problem · Apply an appropriate Operations and Supply Chain Management concept/tool or a set of appropriate concepts/tools to propose a solution to the problem · Analyze the expected results that may be obtained when the solution is implemented. The report should be 8 - 10 pages in length including the cover and appendices, with 1” margins on all sides, double-spacing, and 12 point font. The cover of the report should include title, class code and name, section number, your full name, and date of completion. The report must follow the outline below: 1. Executive summary (no more than one page) - Summarize what is the problem, what Operations and Supply Chain Management concepts/tools have been applied to the problem, and what are the expected results of the proposed solution. 2. Background information - Clearly state whether the problem is from your own work or from business articles/cases. If it is from business articles/cases, provide its source (title, author, name of the journal, date published). - Briefly introduce the company background (e.g., name, products, business size, location, internal/external interesting facts, etc). 3. Problem Description - Describe the problem clearly and specifically. - You should focus on a single OPERATIONAL problem, although you can introduce several other issues for informational purposes. General management problems are not acceptable. - The problem may involve either operational decision-making or process improvement. - This section must include a problem statement starting with, e.g., “This paper considers the problem of determining ...”, “The main problem of the firm is how to ...”, etc, either in the beginning or at the end of the section. 4. Operations and Supply Chain Management concepts/tools that can be applied - Describe what specific Operations and Supply Chain Management concepts/tools can be applied to the problem and why they are appropriate to the problem. This section should make it clear that you understand the concepts/tools you are about to use. 5. Application of Operations and Supply Chain Management concepts/tools - Choose an Operations and Supply Chain Management concept/tool or a set of concepts/tools among the ones provided in section 4 and apply it to propose a solution to the problem. - In this section you “must show your calculations”, which means that you must use real or estimated/simulated data in solving the problem or analyzing the process. It is NOT acceptable to provide only general descriptions of how the concepts/tools can be applied. 6. Analysis of expected results - Analyze the expected results of the proposed solution. You should compare between before and after the implementation of the proposed solution and justify the proposed solution clearly. - The expected results may include cost/revenue impact and/or improvement of operational performance such as throughput time, throughput rate, and inventory. You must be specific to receive full credit. 7. Conclusion The meaning of an operational problem will become clearer as you study this course (see the textbook contents). An operational problem may involve process design and improvement, supply chain management, capacity planning, inventory management, quality management, project management, production planning and control, foreca
Explanation / Answer
Hindalco Supply Chain
An industry leader in aluminium and copper, Hindalco Industries Limited, the flagship company of Aditya Birla Group, is the world's largest aluminium rolling company and one of the biggest producers of primary aluminium in Asia. Its copper smelter is amongst the largest single location custom smelter globally.
Hindalco Industries sources the raw material from various locations within as well as from outside India. The company owns coal mine in India as well as Australia, from which it extracts the coal and transports it to India to feed the captive power plants producing power to run the plant. Similarly, it sources the raw material required for aluminium smelter from various locations from eastern to western part of India as well as imports the part of it.
Besides the first plant at Renukoot Hindalco's other units in India are located at Muri in Jharkhand, Belur in West Bengal, Kollur in Andhra Pradesh, Silvassa in the union territory of Dadra and Nagar Haveli, Hirakud in Orissa, Alupuram in Kerala, Taloja in Maharashtra, Belgaum in Karnataka and Dahej in Gujarat. The finished goods produced at all of these plants are shipped to customers at different locations. The transportation network for inbound as well as for outbound logistical activities is a combination of different modes of transportation such as roadways, railways and seaways.
The Problem
Currently, the Company is facing some issues regarding the delivery time and increased costs in the current multimode transportation system and hence the company is thinking of switching to single mode transportation model using the vast network of Indian railways. After looking at the company’s supply chain activities at a glance, we would do the comparison between the two transportation systems for the Renukoot plant.
Supply Chain Management: An Overview
Supply chain management (SCM) is the oversight of materials, information and finances as they move in a process from supplier to manufacturer to wholesaler to retailer to consumer. Supply chain management involves coordinating and integrating there flows both within and among companies. It is said that the ultimate goal of any effective Supply chain management system is to reduce inventory (with assumption that products are available when needed).
Supply chain management flows can be divided into three main flows as,
Today Hindalco, at Renukoot, operates across the aluminium value chain from bauxite mining, alumina refining, aluminium smelting to downstream rolling and extrusions. The integrated facility houses a 700,000tpa alumina refinery and a 345,000tpa aluminium smelter along with facilities for production of semi-fabricated products namely conductor redraw rods, sheet and extrusions.
Inbound logistics of the company performs the procurement of all the raw material required to produce finished goods. In spite other raw materials, coal and bauxite are the two major materials required to run the plant. Coal is required to run the captive power plant so as to generate power which is used to run the plant. Whereas, bauxite is the raw material which is converted into aluminium in the aluminium smelter. Both the material are sourced from within as well from outside the country. The company owns coal mines in India, Australia from where it sources coal to the plants at various locations. The coal purchased from other sources is transported by the dedicated railway line till the unloading point near the plant, there onwards it is transported on the conveyer belts.
The outbound logistics of Hindalco consists of multimode transportation system with the combination of truck and rail. Finished goods leaving the Renukoot plant follows the following path before reaching the destination, which is port.
Features of Supply chain
Hindalco, being a market leader, seems to be operating its supply chain very efficiently and effectively. However, Hindalco was facing Long Delivery cycle time and high logistics expenses due to use of Multi-Mode Transport system on their dispatch routes. Due to global recession and increasing demands from buyers to reduce delivery lead times, there was pressure from the top management to reduce the expenses without compromising on service.
The problems Hindalco facing with its supply chain management are due to,
Considering the delay in the delivery and increase in logistical costs, Hindalco is thinking of using single mode transportation system instead of current multi-mode transportation system. The single multimode transportation system would consist of seamless railway network of dedicated trains from the plant to the respective ports.
Advantages of Single mode transportation over multi-mode transportation system are;
Besides, these advantages of single mode transportation system over multi-mode, there are some disadvantages of single mode transportation system;
Comparison between Multimode and Single mode transportation system
Having studied the supply chain of Hindalco, we have tried to do a comparative study of single mode and multimode transportation on the basis of some assumptions so as to compare cost and lead time in either of the transportation systems. For the study purpose we would consider operations only at Renukoot plant, exporting finished goods via west and east coast ports Mumbai and Haldia respectively.
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