SCM Conference

'5 % Cost Savings in Materials is Equivalent to 30 % Increase in Turnover'

The conference discussed various supply chain management issues and strategies required to tide the times of recession

With an aim to educate the materials management professionals of healthcare industry to deliver quality and cost-effective materials, Apollo Hospitals, Bilaspur organised a seminar— 'Role of Supply Chain Management in Recession' in its premises on 8th of August, 2009. The event was graced by key speakers known for their outstanding work in the area of Supply Chain Management (SCM). Express Healthcare was the official media partner for this event.

In his welcome address, Dr VR Ramanan, CEO, Apollo Hospitals, Bilaspur, said, "Materials management is a rapidly advancing field and holds the key for growth of the economy in various business sectors. In the present day of highly competitive environment, it is absolutely important to have a prompt SCM for materials which would help us in providing quality service at competitive price. Hence it is important that materials professionals are exposed to practical aspects of latest techniques in supply chain through this conference. This would contribute to enhancement of their individual professional capacity." On this occasion, the official souvenir of the conference was also released. Dr A K Gupta, Medical Administrator, Apollo Hospitals, Bilaspur gave a short presentation about the hospital facilities and its future plans. "Apollo Hospitals, Bilaspur has initiated the process of NABH accreditation. A department of business development has been established which is actively covering all neighbouring states with the aim of touching patients lives. And very soon, the hospital will start the renal transplant facility for the benefit of patients," said Dr Gupta.

Manoj Pandey

Piyush Shah

K Nagappan

Dr Ashutosh Mohan

The first speaker Dr Ashutosh Mohan from Banaras Hindu University, Varanasi spoke about the process efficiency in SCM. While talking about supply chain orientation with the economy, he said, "Companies' quest change with the industrial cycle. When business is booming, executives concentrate on maximising speed. When the economy heads south, firms desperately try to minimise supply costs." He further highlighted the common pitfalls in SCM like absence of supply chain metrics, inadequate definition of customer service, inaccurate delivery status data, ignoring the impact of uncertainties, discrimination against internal customers, poor coordination, incomplete shipment methods analysis etc. "Ensure top management commitment of process chain members, develop a collaborative culture based on open communication and shared responsibility, share resources, capabilities, and risks-based on win-win trust relationships, link supply chain/network as a complete end-to-end synchronised process, design processes with customer needs in mind and perform only value-adding activities," said Dr Mohan as he spoke about the critical success factors for process chain excellence. According to him, in order to achieve process chain excellence, corporate executives, leaders and managers must first understand the so-called process chain wheel. The wheel depicts the order of an ongoing strategy planning and execution process from understanding to execution.

KK Ojha, Ex Dean, Indian Institute of Coal Management, Ranchi, spoke on the best practices in Coal India. "Vendor managed inventory/ consignment stores concept is very useful in reduction of locked up capital in inventory and its carrying cost. Simultaneously, it increases availability of materials," said Ojha. He further added that whenever there is a large amount of requirement of particular item, the vendor managed inventory becomes very useful. “If it has been useful in Coal India, it will be outside too,” he opined.

Piyush Shah, Assistant Professor - Operations Management, NMIMS University, Mumbai spoke on the technique of lean management in SCM. "Lean management is a simple technique based on few simple principles designed over a period of 30 years at Toyota. They are based on common sense and have proved very effective in making Toyota the largest automaker in the world. Lean management is about removing all wastes from the existing processes and solving all deviations by eliminating the root cause," explained Shah. While talking about lean management in SCM applications, Shah said that lean is neither about zero inventories nor about working with minimum resources. It is a philosophy of zero tolerance to wastes. In times when the business is running at full steam, implementing lean would be very difficult. This recession provides a golden opportunity for companies to experiment and create their own paradigm of lean supply chains.

K Nagappan, DGM- Materials, Apollo Hospitals, Chennai spoke on role of SCM in recession. Said Nagappan, "Supply Chain is pervasive to all businesses and involves the movement of products/materials. It deals with process of planning, implementing, controlling its operations ensuring customer satisfaction. It is a tool that business can utilise for their growth as it fuels profit and provide competitive advantage to organisation." Five per cent cost savings in materials is equivalent to 30 per cent increase in turnover of any organisation. SCM plays role to get what is needed by end customers timely (with maximum profitability to organisation and Supply Chain partners), he added.

Harish Kedia, President of Chhattisgarh Laghu Sahayak Udyog Sangh spoke on the impact of recession in small and ancillary industries of Chhattigarh. The last presentation of the day was given by Manoj Pandey, Manager Materials, Apollo Hospitals, Bilaspur on the golden role of SCM. Said Pandey, "The goal of a supply chain strategy is to strike the balance between responsiveness and efficiency. For each of the individual drivers, supply chain managers must make a trade-off between efficiency and responsiveness. The combined impact of these four drivers then determines the responsiveness and efficiency of the entire supply chain." He then described the major drivers of supply chain performance which are facilities, inventory, transportation and information.

The conference ended with a vote of thanks given by Dr Gupta.

EH News Bureau