A well automated optimisation based logistics system can be modeled based ...

A well automated optimisation based logistics system can be modeled based ...

With Ramco ERP on Cloud for the cement industry, one can automate the cement loading and unloading process. It is intended to bring about a Self- Service Loading System (SSLS) to automate cement delivery processes, says
Ranjan Tayal, Senior Vice-President, Business Consulting Group, Ramco
. Excerpts from the interview.

What are the challenges in the supply chain management the cement industry faces?
The cement industry today faces varied challenges. Spiraling cost of raw materials, high and raising freight costs, high carbon oriented production processes calling for investment in more green technologies, poor quality of input material getting into line rejections, supplier lead times exceeding originally planned date lines for critical input items, sub optimal load optimisation, vehicle idling at customer premises due to delays in unloading, are some of them.

How is your supply chain cost divided on different fronts?
In any cement oriented organisation, there are individual cost components. From an IT perspective, they are configured in the Management Accounting and Chart of Accounts (COA) in a way to ensure their tracking and post the costs incurred. This forms the basis for visibility to the supply chain related costs. They can be grouped for reporting purposes at any given point in time, drilled down to have a more detailed view and analysed to make required, appropriate changes.

Are you considering automating the cement loading and unloading process?
Yes, with Ramco ERP on Cloud for the cement industry, one can automate the cement loading and unloading process. It is intended to bring about a Self- Service Loading System (SSLS) to automate cement delivery processes. Using smart cards and kiosks, a lorry driver will be able to serve himself, starting from the gate in and all the way to the gate out. Self- service loading will create interface with ERP to keep track of the delivery events, as well as provide the necessary information to the drivers. This data provides useful repository for analysis and help improve the efficiency of delivery process, and reduce operation costs. The real-time tracking also provides an ability to take right action at the right time.

Why has cement transport via BCCW not picked up too well in the country?
It has not caught on in the country due to reasons such as convenience, railheads being far away from actual points of consumption, need to use road transport from railheads, pilferage, damages and delays in movement of wagons and practically no visibility on consignment movement once loaded, as GPS systems are not in vogue in the railways.

How do you deal with warehouse shortages?
With Ramco ERP on Cloud, one can periodically track the stocks on hand, stocks available to promise (ATP). One can also use the analysis techniques such as ABC, VED and FSN for tracking real-time data. Besides this tracking minimum stock levels, safety stocks and minimum stock thresholds in the inventory management systems stock outs can be avoided.

How do you ensure that your fleet is performing at its best?
Ramco ERP on Cloud for the cement industry tracks operations in real time. The system provides critical data to reduce operational costs. Tracking involves processes such as capacity, loading time, unloading time, vehicle idling, etc.

What are the advantages / disadvantages of using carry and forward agents?
Advantages: Reduced cost of operations due to activity being outsourced, availability of stocks at remote locations, easy movement, opportunity taken.

Disadvantages - Quality of service may not match delivery by principles; besides training, C & F would involve costs. Monitoring becomes difficult for each delivery unless they are connected through portals.

In a growing economy like ours, constant fluctuation in demand and raw material is a big challenge. How can the logistics system be modelled to accommodate these variations?
This can be done by long -term planning and analysing seasonal trends. Often, historic data helps to determine (more or less accurately) the actual demand, planning and production. Based on delivery schedules, a well automated optimisation based logistics system can be modelled. The key here is long- term planning for raw material procurement, which requires collaboration with suppliers.

What are the factors considered while designing a logistics plan?
Delivery planning, delivery schedule based optimal route and vehicle planning, load optimisation, driver planning, ware house and loading yard planning, bulk haulage planning are key factors.

What leads to errors in demand forecasting?
Usually very long- term based demand forecasting leads to errors. While this depends on how long the period is, for example a demand forecast beyond six months can be full of errors. Long- term demand forecasting will be less accurate than the short- term ones. This can be avoided by periodically reviewing the long- term forecasts and tweaking them as per practical needs and reality. This is much better than adopting a less accurate demand forecast. Periodic analysis of buying patterns and history data of large customers also helps to ascertain if the demand forecast for key product lines and groups are right.

How does one improve synchronisation between supply and demand?

  • Automation.
  • Real time data capture.
  • Storage and tracking.
  • Better planning strategies.
  • Periodic reviews.
  • Better collaboration between the enterprise and the suppliers for collaborative planning.

Demand planning coupled with inventory and supply planning could help end- to- end supply chain efforts.

What are your future plans for the company?From an IT perspective, we aim to:

  • Adopt more automation - capture more real time data and analyse it.
  • Collaborate better with suppliers in planning processes.
  • Provide access to supplier portal for critical suppliers.
  • Provide access to customer portal for key customers and analyse their consumption patterns.
  • Use dashboards for trend analysis.
  • Track vehicle usage and optimize it.
  • Analyse loading patterns.
  • Manage sales orders efficiently.
  • Improve picking and packing processes for efficiency.

Using smart cards and kiosks, a lorry driver will be able to serve himself, starting from the gate in and all the way to the gate out.

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