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TERM PAPER
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2nd semester
ACKNOWLEDGEMENT
I take this opportunity to show my gratitude to Mr Sanjai Medhavi, the mentor of this assignment paper and under whose able direction I was able to get an insight of the real business implications of the applicability of the topic of my assignment,i.e. SUPPLY CHAIN MANAGEMENT INFORMATION SYSTEM
HINDUSTAN PETROLEUM CORPORATION LIMITED
I would also like to thank my parents and all those individuals who gave me the proper references and provided me with relevant information on this topic and gave me important web links for assistance
CONTENTS
TOPICS 1) 2) 3) 4) 5) 6) 7) 8) Company Profile Management Information System Supply Chain Management Information System SCIS Application Structure SCIS Support Technologies Advantages of Enterprise Resource Planning Conclusion Bibliography
COMPANY PROFILE
Founded in 1974, Hindustan Petroleum Corporation Limited (HPCL), a Fortune 500 company, is one of the largest integrated petroleum refining and marketing company in India. The company owns and operates two oil refineries at Mumbai and Vishakhapatnam, two cross-country pipelines, and an extensive network of terminals, depots, bottling plants, and aviation servicing facilities. HPCL refineries upgrade crude petroleum into many value-added products and more than 300 grades of lubricants and greases. The company has around 17% market share of the Indian oil and gas sector and also exports its products to Bangladesh, Malaysia, Nepal, and Sri Lanka. To strengthen business management and improve customer service, HPCL implemented an advanced enterprise resource planning (ERP) system based on range of JD Edwards Enterprise One applications from Oracle. The ERP system was implemented at more than 430 locations across India from 2003 to 2005, and is used by over 2,000 employees. The JD Edwards Enterprise One application from Oracle provides many services to HPCL such as: Financ ial Management Huma n and capital Management Manu facturing and supply chain Management The real time, on-line availability of information from across all the geographically spread locations of the corporation on a centralized system, has enabled HPCL to improve efficiencies in the Ares of tracking and monitoring customer receivables, credit management, inventory management and provide enhanced service to customers and other stake holders. Real-Time Information Improves Decision-Making 1. Upgrading to an integrated business management platform gave HPCL an enterprise-wide view of its finance, manufacturing, human resources, and sales and distribution processes. Online access to information ensured managers could keep track of procurement, inventory, production schedules, and customer orders. The company also standardized business practices, ensuring process consistency across multiple locations. Tighter control of its business helped the company improve productivity. In addition, a better understanding of its day-to-day operations assisted senior managers to make faster, better-informed decisions. For example, sales reports are electronically generated and delivered to regional managers and sales officers every day. A document archival system is an integral part of the ERP system, allowing HPCL to store invoices, purchase orders, checks, and other material. This ensures the company can locate critical documents quickly and efficiently. Boosting Service to Customers and Vendors
In keeping with HPCLs aim of enhancing customer satisfaction, the company designed portals that draw on information gathered by its ERP system to provide clients with dispatch details, account statements, and a history of sales transactions completed over the past three years. Customers log in to the portal using a secure user ID and password. Separate portals for aviation, direct sales, LPG, and retail customers were established. HPCL also developed an electronic payment system to promote smoother and faster payments to its vendors, contractors, transporters, and other service providers. The system is integrated with the companys banking institution, enabling payment information to be seamlessly transmitted between the two organizations and ensuring timely payment to suppliers .
Applications of MIS
With computers being as ubiquitous as they are today, there's hardly any large business that does not rely extensively on their IT systems. MIS systems can be used to transform data into information useful for decision making. They can provide financial statements and performance reports to assist in the planning, monitoring and implementation of strategy. MIS systems provide a valuable function in that they can collate into coherent reports unmanageable volumes of data that would otherwise be broadly useless to decision makers. By studying these reports decision-makers can identify patterns and trends that would have remained unseen if the raw data were consulted manually. MIS systems can provide predictions about the effect on sales that an alteration in price would have on a product. These Decision Support Systems (DSS) enable more informed decision making within an enterprise than would be possible without MIS systems. Not only do MIS systems allow for the vast amounts of business data, but they valuable time saving benefit to the Where in the past business information manually processed for filing and collation of also provide a workforce. had to be analysis it
can now be entered quickly and easily onto a computer by a data processor, allowing for faster decision making and quicker reflexes for the enterprise as a whole.
Management by Objectives
While MIS systems are extremely useful in generating statistical reports and data analysis they can also be of use as a Management by Objectives (MBO) tool. MBO is a management process by which managers and subordinates agree upon a series of objectives for the subordinate to attempt to achieve within a set time frame. Objectives are set using the SMART ratio: that is, objectives should be Specific, Measurable, Agreed, Realistic and Time-Specific. In tracking this performance it can be extremely useful to make use of an MIS system. Since all SMART objectives are by definition measurable they can be tracked through the generation of management reports to be analyzed by decision-makers.
Benefits of MIS
The field of MIS can deliver a great many benefits to enterprises in every industry. Expert organizations such as the Institute of MIS along with peer reviewed journals such as MIS Quarterly continue to find and report new ways to use MIS to achieve business objectives.
Core Competencies
Every market leading enterprise will have at least one core competency that is, a function they perform better than their competition. By building an exceptional management information system into the enterprise it is possible to push out ahead of the competition. MIS systems provide the tools necessary to gain a better understanding of the market as well as a better understanding of the enterprise itself.
Transaction system
This level is the heart of SCIS, which initiates and records individual logistics activities. Transactions include order entry, inventory assignment, order selection, shipping, pricing, in voicing and customer inquiry. Transaction system is characterized by formalized rules, large volume transactions and an operational day-to-day focus, which focus on system efficiency (faster processing or higher transaction volume with fewer resources). Electronic data interchange (EDI) has become a transaction system messaging standard.
Procurement Procurement manages purchase order preparation, modification, and release, in addition to tracking vendor performance and compliance. Although procurement systems have not
traditionally been considered part of SCIS, the importance of integrating it is obvious when managing the entire supply chain. Integration of procurement and logistics schedules/activities allows coordination of facility and transportation utilization.
users. So there is a need to recognize that enterprise-wide DSS can compound and magnify the harm from decision errors. Expert System in DSS Knowledge-based systems are also sometimes called expert systems. These computer programs analyze data using symbolic logic, have an explicit knowledge base, and have an ability to explain conclusions in a way that users can understand. Knowledgebased systems can be useful to remind an experienced decision maker of options or issues to consider and it help a new manager make a complex decision. Modeling & Simulation Tools in DSS Another integral part of DSS, is modeling and simulation module. Modeling can be defined as the process of developing a symbolic representation of a total system. A model must accurately represent the real world and be managerially useful. For example, for some reason the demand of a certain product drops, the model should give some suggestion how much the procurements for production need to be reduced. Simulation is a technique used to provide a model of a situation so that management can determine how the system is likely to change through the use of alternative strategies. The model is tested using known facts. By utilizing expert system, modeling & simulation tools, DSS can forecast and predict appropriate inventory level, procurement, or distribution strategies.
3. Cheaper cost: Shared network is relatively cheaper than wholly owned or leased EDI line. 4. Send-once-to-many: A single EDI messages can be forwarded to a multiple recipients by VAN. 5. Accountability: Usually VAN generates monthly audit trail to its customer (the company which uses VANs mailbox). 6. Security measures: VAN usually offers added-value of EDI by improving its security (e.g. authentication and encryption), and VAN may also act as a buffer between companys computers to the outside world, so no outsiders have direct access to companys internal computer. 7. Interconnectability: If the new partner has already been a customer of another VAN, EDI messages still can be exchanged between VANs. Currently, the new trend is to use EDI over cheaper public network like Internet. Problem with EDI is, although there exist standards, but there are still too many standards, so sometimes it seems that there is no standards at all. Some argued that, as a manner of fact, special purpose proprietary EDI messages can actually give competitive edge, because it was designed to serves a special function other competitors do not have.
Bar Coding
Bar codes are a sequence of parallel bars of various widths, with varying amounts of space between the bars. Bar coding can help to reduce cycling time, accuracy account of actual receipt for entire material function
The freight information & tracking system allow companies to increase the speed and effectiveness of order processing, which enables the firm to meet demands for higher service standards without increasing operating costs. The benefits of FITS are: a. greater reliability and confidence in scheduling b. faster customer billing c. faster border check & crossing d. faster freight loading and unloading e. better control over the fleet f. more accurate order tracking
CONCLUSION
Information is the key to successful supply chain management because no product flows until information flows. The inventory manager needs direct access to the organizations information system to properly administer materials flow into and within the organization. Information technology should be used to improve the management of the supply chain. Accurate and timely information allows a firm to minimize inventories, improve routing and scheduling of transpiration vehicles, and generally improve customer service levels. The types of information needed include demand forecasts for production, names of suppliers and supplier characteristics, pricing data, inventory levels, production schedules, transportation routing and scheduling data and other financial and marketing facts. Thus, modern information technology will offer opportunities for the fast and safe transmission and processing of extensive amounts of data, both internally for users within the company and externally for supplies and customers. Paperless communication is coming to the forefront whereby routine tasks in order processing and scheduling will be decisively facilitated. As a result, new information technology offers great opportunities for linking the planning, control, and processing functions of inventory management. The proliferation of computerized information systems and databases, coupled with electronic data interchange (EDI), will make this facet of materials management even more significant in the future. There are seven benefits to use information technology, although the basic setup cost is high. 1. Great accuracy. The use of bar code increases the accuracy at least 100 times. 2. More economy. 3. Faster processing time. 4. Higher visibility. Powerful software can afford an instant overview of the inventory picture across warehouses, retail units, or sales territories. 5. Immediate availability 6. Tighter customer focus 7. Higher productivity Because the supply chain is so wide reaching, its success depends on nearly all departments within a company. However, the effort to improve supply-chain performance must be driven by senior management. Since the supply chain has become the key opportunity to gain competitive advantage, senior management needs to constantly remind their organizations that an improved SCIS performance is a business issue, not a logistics or computer systems issue.
BIBLIOGRAPPHY
oracle.ittoolbox.com/documents/popular-q-and-a/erp-benefits-and-disadvantages-3946 oracle.com/customers/snapshots/hindustan-petroleum-jde-case-study.pdf
James A O Brien hindustanpetroleum.com/ - 28k