MS-55

Management Programme

ASSIGNMENT SECOND
SEMESTER
2016

MS-55: Logistics and Supply Chain Management

Program Title:MP
Course Code: MS-55
Course Title: Logistics and Supply Chain
Management
Assignment Code: MS-55/ TMA/SEM - II /2016
Partner Institution (PI) Code: 9602

Enrolment No: ID1356210

Name: Prajwol Raj Aryal
Address: Tokha-10, Kathmandu
Signature:
Date of Submission:

ASSIGNMENT
Course Code

MS - 55

Course Title

Logistics and Supply Chain Management

Assignment Code

MS-55/ TMA/SEM - II /2016

Coverage

All Blocks
st

Note: Attempt all the questions and submit this assignment on or before 31 October, 2016 to
the coordinator of your study centre.
1. Every organization has to move materials to support its operations. Take the case of a
poultry that deals in eggs, meat products and a range of related goods. What materials
are moved in this case?
2. An integrated supply chain is a convenient notion, but it does not reflect real operations.
An organization is only really concerned with its own customers and suppliers, and does
not have time to consider other organizations further along the chain. Do you think that
this is true?
3. Give various supply chain information categories. Give examples of information
contained in these categories with reference to a FMCG company.
4. Managers can be tempted to use the easiest measures of performance, or those that show
themselves in the best light. What are the consequences of this? Can you give examples
of problem this create?
5. Take the example of a nationalized bank and discuss how it is cutting costs and
improving customer service by changing its supply chain from brick and mortar branches
to ATMs and phone & net-banking.

1. Every organization has to move materials to support its operations. Take the
case of a poultry that deals in eggs, meat products and a range of related
goods. What materials are moved in this case?
Answer:
All industries require the movement of men and materials. Industry concept itself is
about the processing of appropriate men and materials so as to create a favorable
environment towards processing and then to move the processed material to the market
for consumer consumption.
A poultry based industry has multiple products as output. Based on general product
output of a general poultry industry following materials might are most likely to require
movement arrangements:
1. Bird feed
2. Bird medicines ,disinfectants and other related chemicals
3. Bird vitamins and produce increasing feed supplements
4. Live adult bird
5. Live Chicks
6. Normal eggs for market consumption
7. Special chick hatching eggs
8. Machinery and equipments required for maintaining required production types
9. Office supplies and related machine and equipments
10. Waste output from live birds
11. Waste output from meat processing
12. Product output such as eggs , meat and other products
13. Packaging materials and related wastes
14. Special worker gear and accessories
15. Special wastes posing biological and environmental hazard( all wastes resulting
out of bird-disease situations)

2.

An integrated supply chain is a convenient notion, but it does not reflect real
operations. An organization is only really concerned with its own customers and
suppliers, and does not have time to consider other organizations further along
the chain. Do you think that this is true?
Answer:

An integrative supply chain has many advantages for an organization but at the same
time demands extra resources which always has been questioned on it worth. An
integrated supply chain contributes a big deal towards better and most advantageous
inventory management. But in parallel it comes with an extra cost to access and oversee
the supply process involved with other organizations also. However when considered
for various factors involved, in a logical way, it wouldnt require much thought to
support the notion of integrated supply chain.
There are several disadvantages to integrative supply chain. Integrating external and
internal suppliers makes it difficult for a business to separate the processes needed to
manage each supplier. Internal and external suppliers to key processes have different
modes of operation and uses. Integrating these suppliers can cause a mix-up in
resources that can delay product creation and create unsatisfactory experiences for
consumers. Combining internal and external suppliers can cause a breakdown in a
company's checks and balances system to monitor for defects in raw materials and
goods for sale. Specific government compliance standards exist across many industries
as guidelines for product safety and consumer protection. Integrating external and
internal suppliers can blur these guidelines, cause employees to miss steps in the
inspection process and promote errors in a company's supply chain.
On the other hand, integrating supply chain also has a big list of advantages. Tight
supply chain integration gives management operational flexibility to respond rapidly to
external events, such as the actions of competitors and changes in customer demand.
Companies can gather intelligence through their supply chains, which allows them to
be

generally

aware

of

what

their

competitors

are

planning

months

in

advance. Integrated supply chains improve inventory management, which means fewer
overstocked and under stocked conditions. Overstocking may result in higher storage
costs and product obsolescence, while under stocking could mean losing customers to
competitors. Tight integration means that retailers can quickly adjust their inventory
orders weeks or months in advance of anticipated changes in customer demand to
ensure that the right amount of stock is on hand. Operating flexibility and tight
inventory management lead to a lower cost structure, which results in higher profit
margins. Tightly integrated supply chains can serve as early warning systems. For
example, if a supplier is experiencing cash flow problems, customers will find out
quickly and they can start making alternative arrangements.
Hence even if a company needs some extra resources to cope up with the requirements
of integrated supply chain, advantages and profits resulting out of flexibility and more

efficient inventory management which supports the concept of just in time approach
vastly outweighs the disadvantages of integrated supply chain management.

3. Give various supply chain

information

categories. Give examples

of

information contained in these categories with reference to a FMCG company.

Answer:
Various supply chain categories and corresponding examples with reference to a FMCG
company are listed in following table:
S.N.
1

Information categories
Production information

Examples of Information contained in categories

Product specifications, price/cost, product sales

Customer information

history
Customer

Supplier information

management team
Product line, product lead times, sales term and

Production

conditions
Capacities, commitments, production plans

information
Transportation

Carriers, lead times , cost

information
Inventory information

Inventory

Supply

inventory locations
Key contacts for each organization, partner roles

information
Competitive information

and responsibilities, meeting schedules

Benchmarking information, competitive product

Sales

offering, market share information

Point of Sale information, promotional plans

10

information
Supply chain process and

Process descriptions, performance measures, cost,

performance information

quality, delivery, time, customers satisfaction etc.

chain

and

process

alliance

marketing

forecasts,

levels,

customer

inventory

sales

history,

carrying

costs,

4. Managers can be tempted to use the easiest measures of performance or those

that show themselves in the best light. What are the consequences of this? Can
you give examples of problem this create?
Answer:
Use of easiest measures of performance or non-useful measures of performance, often
fails to fulfill the basic intention behind performance itself. Apart from missing the
benefits of true performance measurement, wrong or easy measurement many also

creates a huge risk of leading the organization towards wrong information and death
trap. Consequences relating out of such situations spread to all aspects viz operations,
maintenance and miscellaneous.
Examples of resulting problems can be:
1. Product design obsolescence
2. Lower supplier reliability and capability
3. Higher partnering costs
4. Lower production
5. Higher operating costs and expenses
6. Violation of law and regulatory requirements
7. Under utilization of system and facility capacity
8. Low trust towards organization and its reports
9. Higher taxes
10. Higher maintenance cost
11. Low quality product
12. Permanent damage to company reputation and finances.

5. Take the example of a nationalized bank and discuss how it is cutting

costs and improving customer service by changing its supply chain from brick
and mortar branches to ATMs and phone & net-banking.
Answer:
RBB Ltd. - established on January 23, 1966 - a synonymous of stable and people's
bank in Nepal - is one of the pioneer Bank in the country with the history of nearly a
half century. The Bank with 2600 hands has expanded its wings in the most part of the
country through multiple distribution outlets of 167 branches ,17 counters,28 branch
less banking (BLB) and 72 ATMs.The Bank with the highest public confidencereflected in the highest deposit base and growing demand for branch establishment in
the various parts -has stood as a pyramid in the financial arena of the country.
The bank has achieved never before achieved heights regarding customer satisfaction
and profit maximization with the use of latest technology such as internet banking,
mobile banking, ATM etc.
RBB has a website which provides almost all information related to the bank. All sorts
of information related and generally required by

customers-lenders and depositors,

general public, media. This also has a portal available for accessing into ones bank
account. This allows viewing and analysis of balance statements and fund transfers
instantly. Hence the website works 24-7 available spokesperson and reception for the
bank. The portal for e-banking functions as 24-7 available personal bank counter. This

has created a huge satisfaction amongst customers and stakeholders. Bank does its
function at minimal transaction cost. This woos booth customers and bank.
RBB also has Mobile Banking service which supports Balance Enquiries, Last
Transactions details, Transactions alerts; e-recharges/bill payments/top up to utilities
like NTC prepaid/postpaid/landline/ADSL, NCELL prepaid /postpaid, inters branch
funds transfer, etc. RBB is also providing Mobile Banking Financial service with its
service powered by PayBill (P) Ltd.. The Customer of RBB can pay utility bills, shop
online, buy tickets, send gifts, pay bills and even transfer money through the mobile
phone. Hence with these services bank has made itself available in the fingertips of its
customers 24-7.
With 72 number of ATM machines functional , bank has virtually made its presence at
72 different locations in terms of hard cash access to its customers , round the clock.
While the services are fast secure and easy, bank does not need to worry on employee
costs since machines dont ask for anything else other than power and regular
maintenance.
Apart from usual banking services internet based and mobile based services has
allowed benefiting largely by enhancing communication to various parties such as
customers and other strategic stakeholders. In recent days bank has earned huge
amount by processing remittance funds. This has become possible with use of
corporate banking systems.
Followings can be noted as cost cutting factors for the bank resulting out of change in
supply chain from brick and mortar branches to internet and mobile based services and
machines:
1. Use of internet, mobile devices and ATM machines lowers salary budget size
2. Machine provide automated calculations in pre determined format hence
eliminating substantial costs associated to hire and employ accounting staffs.
3. Machines display absolute loyalty (unless for machine errors). Hence bank benefits
by higher overall employee loyalty. Machines eliminate the possibilities of human
4.
5.
6.
7.

error.
Use of machines lowers overall employee associated costs.
Machines require low office space hence more operational savings.
Machines lower the need for office stationary and associated costs.
Machines incur lower per transaction cost.

Customer satisfaction also is highly upgraded by the use of ATMs, E-banking and
mobile banking options because of below woo factors:
1. 24-7 hours of service available for customers.
2. Possibility of complex and multiple fund transfers made possible with few clicks on
ones own computer.
3. Interned and phone based service basically provides home delivery of bank counter.

4. Machine provides quick preparation, delivery and display of customer transaction

records.
5. Customers can avoid bank queue and enjoy the comfort of home during banking
transactions.
6. Internet, mobile devices and diverse ATM machine locations virtually support
customers banking needs, wherever they are.