1

EFFECTIVENESS OF SUPPLY CHAIN MANAGEMENT IN KELTRON

EQUIPMENT COMPLEX

Project Report submitted to

Karunya School of Business, Leadership and Management

in partial fulfillment of the requirements for the award of the degree of

Master of Business Administration

ANISH KUMAR R

(PR12MS1156)

Under the guidance of

Mr. Shiva Dhas Mrs. R.Swapna Kumari

Deputy Manager (Technology Center) Assistant Professor

KARUNYA SCHOOL OF BUSINESS, LEADERSHIP AND MANAGEMENT

KARUNYA UNIVERSITY

[Declared as a Deemed University under sec.3 of the UGC Act, 1956]

April, 2014

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DECLARATION

I, R.ANISH KUMAR, (PR12MS1156) hereby declare that the project report entitled “Effectiveness of Supply Chain Management in Keltron

Equipment Complex” is a bonafide record of the original research work carried out by me in the department of Management studies, Karunya university and that it has not been submitted earlier elsewhere for the award of any Degree, Diploma or Fellowship.

Place

Date: Signature of the Candidate

3

CERTIFICATE

This is to certify that the Intership project report entitled “KELTRON EQUIPMENT

COMPLEX” is a bonafide record of work done by ANISH KUMAR R(PR12MS1156)

under my supervision and submitted in partial fulfillment for the award of the degree of

Master of Business Administration of Karunya University.

Place:

Date: Research Supervisor

Director, KSBLM

Internal Examiner External Examiner

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ACKNOWLEDGEMENT

First and foremost, I thank the God for sustaining the enthusiasm with which plunged

into this endeavor.

I am deeply indebted to Mr. Sivadasan, Project Officer for giving me the

persuasion to do the project in her esteemed concern and also for her valuable guidance, timely

advice and words of encouragement.

I also express my sincere thanks to all people who spend their valuable time giving

suitable guidance and sharing their experienced with me.

I express my gratitude to Mrs. Swapna Kumari, Faculty of Karunya University, for

his guidance, constant interest and encouragement which has enabled to complete my project

successfully.

I would also like to express my special thanks to all the department heads that I have visited for

their support, information, co-operation, advice to complete my project and would also give my

sincere thanks to all the staff and the members of KELTRON ,Trivandrum,

In addition, I express my affection to my beloved parents, friends & all my colleagues for

providing support throughout the study.

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ABSTRACT

A brief study of Supply Chain Management occupies a prominent place in

the Keltron Equipment Complex. There are several department in the keltron

equipment complex I had chosen to study the supply chain Power Electronics

Department.The main objective of the project is to study the supply chain

management of keltron, to analyze the procedure involved in the supply chain

management in keltron equipment complex and to improve the efficient of supply

chain management in keltron equipment complex.

By finding the problems in the supply chain management it is found that the

management is doing every process manually and there is large time delay during

the process. To overcome all the problems in the supply chain management it is

suggested to use electronic supply chain management. So there will real time

transaction will happen and the company need not want any space for

documentation and also the supply chain management will be more effective.

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TABLE OF CONTENTS

CHAPTER NO. TITLE PAGE NO.

CHAPTER 1 INTRODUCTION 11

1.1 INTRODUCTION 12

1.2 HISTORY 14

CHAPTER 2 INDUSTRIAL PROFILE 18

2.1 INDUSTRIAL PROFILE 19

CHAPTER 3 COMPANY PROFILE 21

3.1 COMPANY PROFILE 22

3.2 FINANACE DEPARTMENT 28

3.3 MARKETING DEPARTMENT 28

3.4 PLANNING DEPARTMENT 29

3.5 PRODUCTION DEPARTMENT 29

3.6 QUALITY ASSURANCE 30

3.7 TESTING 30

3.8 PURCHASE DEPARTMENT 31

3.9 SOLAR ENERGY INVERTER 31

3.10 POWER ELECTRONICS UPS 31

3.11 SIGNIFICANT ACHIEVEMENTS 34

3.12 GENERAL DESCRIPTION OF UPS 34

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3.13 FEATURES OF 600KVA UPS 35

3.14 SPECIAL FEATURES OF KELTRON UPS 35

CHAPTER 4 DESIGN OF THE STUDY 36

4.1 STATEMENT OF THE STUDY 37

4.2 SCOPE OF STUDY 37

4.3 OBJECTIVES 37

4.4 RESEARCH METHODOLOGY 37

4.5 RESEARCH PERIOD 37

4.6 RESEARCH PLACE 38

4.7 SOURCES OF DATA AND INFORMATION 38

4.8 LIMITATIONS 38

CHAPTER 5 LITERATURE REVIEW 39

5.1 LITERATURE REVIEW 40

CHAPTER 6 DATA ANALYSIS AND

INTERPRETATION

44

6.1 SUPPLY CHAIN MANAGEMENT 45

6.2 DESCRIPTION OF THE SUPPLY CHAIN WORK

FLOW

47

6.3 PURCHASING 49

6.4 SUPPLIER SELECTION 51

6.5 PROCEDURE FOR OPERATIONS MANAGEMENT 52

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6.6 PRECAUTIONS 54

6.7 MEASUREMENT,ANALYSIS AND IMPROVEMENT 55

6.8 MONITORING AND MEASUREMENT 56

6.9 ANALYSIS OF DATA 57

6.10 QUESTIONNARIE TO IMPROVE EFFICIENCY OF

SUPPLY CHAIN MANAGEMENT

59

6.11 IMPLEMENTATION 61

6.12 ELECTRONICS SUPPLY CHAIN MANAGEMENT 62

6.13 FINDINGS 64

6.14 SUGGESTIONS 64

CHAPTER 7 CONCLUSION 66

7.1 CONCLUSION 67

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LIST OF CHARTS

CHART NO TITLE OF THE CHART PAGE NO

1 EFFICIENCY OF SUPPLY CHAIN 1 59

2 EFFICIENCY OF SUPPLY CHAIN 2 59

3 EFFICIENCY OF SUPPLY CHAIN 3 60

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TABLES OF FIGURES

FIGURE NO. NAME OF THE FIGURES PAGE NO.

1 600KVA UPS 33

2 SUPPLY CHAIN MANAGEMENT IN KELTRON 45

3 WORK FLOW OF POWER ELECTRONICS GROUP 46

4 SUPPLY CHAIN OF PURCHASING PROCESS IN

KELTRON

50

5 ELECTRONICS SUPPLY CHAIN MANAGEMENT 62

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LIST OF TABLES

TABLE NO. TITLE OF TABLE PAGE NO.

1 LOCATION OF KELTRON 26

2 SUPPLIER SELECTION 51

3 QUESTIONNAIRE FOR EFFICIENCY OF SUPPLY

CHAIN

59

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CHAPTER 1

INTRODUCTION

13

CHAPTER 1

1.1 INTRODUCTION

Supply chain management is a cross-function approach including managing the

movement of raw materials into an organization, certain aspects of the internal processing of

materials into finished goods, and the movement of finished goods out of the organization and

toward the end-consumer. As organizations strive to focus on core competencies and becoming

more flexible, they reduce their ownership of raw materials sources and distribution channels.

These functions are increasingly being outsourced to other entities that can perform the activities

better or more cost effectively. The effect is to increase the number of organizations involved in

satisfying customer demand, while reducing management control of daily logistics operations.

Less control and more supply chain partners led to the creation of supply chain management

concepts. The purpose of supply chain management is to improve trust and collaboration among

supply chain partners, thus improving inventory visibility and the velocity of inventory

movement

Keltron is India’s first and the largest electronics corporation in the State sector. Keltron

has been a catalyst in making electronics work in almost every aspect of our daily life, since

1973. Today, we live in a technology-driven world where speed, flexibility, intellectual capital

development, and networks have become the basis of value creation - as connectivity and

interactive technologies pervade all business activity. In this technology-driven environment,

Keltron finds the assimilation, adoption and integration of technology in creating innovative

solutions as the very basis of survival. Keltron's success has been in making technology work

rather than inventing it. Keltron has been a catalyst in making electronics work in almost every

aspect of our daily life, since 1973. Keltron's strength lies in the stable foundation and experience

built over the years, its strong human capital, its nation-wide network and its agility to adapt

itself to change. With over a 30-year long track record as a manufacturer of sophisticated

electronic devices and systems, Keltron presents itself in the global market as a one-stop-shop

for manufacturing, system integration, and after-sales-support in India.

Recently, Keltron has added to its repertoire, a set of knowledge services to foster greater

global competitiveness for Indian industry as well as to ensure quicker innovation; and an

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independent division for project consulting to extend the benefits of its large knowledge capital

in the form of comprehensive solutions to customers in several market segments worldwide.

1.2 HISTORY

KELTRON’S history is a saga of innovation in electronics. From being a pioneer in

1973, to the role of a trend-setter today, Keltron has been the catalysis for the development of

electronics industry in Kerala. The tag line launching a State-owned electronics enterprise, more

than a quarter century ago, read “spearheading an electronics revolution in Kerala”. It was an

experiment by Government of Kerala to transform the laid-back, picturesque Kerala State known

for its spices, natural beauty, Kathakali and the Onam boat races, to an arena for industrial and

technological development. That was how Keltron was born. Within five years of its inception,

Keltron had set up a production centre in every district of the State. More than 5,000 people were

engaged directly or indirectly by Keltron for the manufacture of electronic goods. The model of a

State-owned electronics corporation was so successful that several other States in India followed

suit; launching their own electronics corporations. A quarter century later, Keltron after having

contributed substantially to the industrialisation of the State, set about transforming Trivandrum,

the capital city of Kerala, into one of the major electronics hubs of the country. Today, the city is

home to Technopark, the internationally known technology park where thousands of talented

men and women participate in the development of a burgeoning information technology

industry. Thus Keltron has in effect triggered a revolution that still keeps churning out its

benefits to individuals and institutions in different parts of the world, continuing in its quest to

innovate products and processes that would add further value to life and to the industry. Keltron

has been making things happen since 1973 starting with spearheading an electronics revolution

in the country to being the most sustainable electronics corporation in the state sector. A strong

infrastructure, enterprising team of people, innovative operational methods, accent on quality and

customer-orientation are the core competencies of the organization which has made things

happen all these years. Large Pool of Experienced Technical Man power Keltron’s expertise in

high quality manufacturing is the direct result of the highly skilled, multi-disciplinary team of

graduate engineers, project managers and a skilled work force with a proven track record in

complex precision manufacturing. Currently, Keltron employs a work force of 2000 of which

400 are Engineers who possess extensive hands-on experience in technology integration and

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adoption, high-tech manufacturing operations and in managing turn-key projects. Quality and

reliability of KELTRON products have been endorsed over and over by the large customer base

and ISO 9000. By forging strategic alliances with world leaders, KELTRON is poised to

maintain a global presence and keep itself abreast of current technologies.

Man power at Space Electronics section has been specially trained at Indian Space

Research Organization (ISRO) in high-reliability soldering, harnessing and QC. Keltron also

provides technical manpower to major organisations like ONGC and VSSC, and collaborators

like Hitachi, Japan. Country-wide Sales Network

Keltron has an All India Sales Network in place with full-fledged Marketing Offices in Mumbai,

Delhi, Kolkata, Chennai, Bangalore, Hyderabad, Ahmadabad and Trivandrum to provide the

quickest possible service to customers. Technology Support At the moment, Keltron has an

arrangement with C-DAC, a research and development organization under the Government of

India, which is located in the Keltron campus, for technology development and adaptation. An

in-house research and department facility along with a full-fledged Knowledge Centre is in the

pipeline and will be implemented shortly. Strong Infrastructure and Manufacturing Experience

Since its inception in 1973, Keltron’s forte has always been high quality manufacturing. During

the past 40 years, Keltron has churned out a whole range of electronic products, electro-

mechanical and high precision modules and sub assemblies for different industry segments. Over

the years, Keltron has built up a strong infrastructure spread over 7,00,000 sq ft of built-up area.

Equipped with computer-based facility for system design & engineering, and software

development tools for embedded systems, Keltron today is fully geared to offer integrated

manufacturing solutions.

The registered name of the company is Kerala State Electronics Development

Corporation Limited (KSEDC Ltd). The name Keltron was coined from two words, Kerala

Electronics and when it was necessary to use a small word in Telegrams referring to the

company. Later, the same naming convention was adopted to name two other state owned

electronic companies namely Meltron (Maharashtra Electronics) and Uptron (UP Electronics).

In its early days, the company produced DCS,PLC,electronic devices such as televisions,

radios and other consumer electronics goods. On this end, the company was a failure to provide

its quality consumer goods with competing rates and hence its products could not compete in

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international market. Keltron is famous for its automatic traffic regulation systems. In early days,

Keltron traffic signals were used in all the major metro cities of India. Currently it is mainly used

in Kerala and few neighbouring states.

Currently, major products of the company include mines for Indian navy and various

parts of Rockets for Indian space research organisation ISRO. The company also produces basic

electronic components such as capacitors, transistors, resistors, diodes, PCBs on a large scale for

the Indian market. It also provides services in the field of information technology, animation,

and web designing. It has recently established a division for geo-informatics services.

During the early days of Globalisation, Keltron faced severe crisis, and became loss making unit,

due to the failure in competing with multinational companies.But still a rising industrial

company

Recently the company has started recovering from the crisis and is currently operating in

profit. In 2005-06 the company made a net turn over of 109 crores with an operating surplus of

13 crores

Keltron is a multi-product, multi-centric organization based in Kerala producing a wide

range of products starting from discrete electronics components to complex equipment and

systems. Keltron products are brought to the customers through a nation-wide marketing and

sales network with Marketing Offices in Mumbai, Delhi, Kolkata, Chennai, Bangalore,

Ahmedabad, Hyderabad and Trivandrum

Keltron animation campus is one of the finest academies to offer a specialized focus on

Animation and Multimedia, KAC was established by experienced persons from the industry to

provide high-quality training in a disciplined approach which cultivate the student’s creative

force in a state-of-the-art learning ambience equipped with the latest and best that technology can

offer. KAC was established with the purpose of linking the gap between the requirements of the

rapidly booming animation and visual effects industry for skilled professionals who accomplish

industry's needs

There are several challenges faced by Keltron. The important challenges are failure to

provide quality consumer goods at competitive rates, failure to competing in international

markets, failure to withstanding newly arrived MNC companies due to globalization, huge

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accumulated losses, low productivity owing to anticipated machinery, absence of further capital

investment, shortage of manpower including skilled technical labour, high rate of financial

charges, upward variation of foreign exchange value against rupee.

The strategic electronics products in keltron are Processor Based Ground Mine, Sonobuoys, Ship

Control Systems, Echo Sounder, EM Log, Sonar Simulators, Navnet, Expandable Bathy

Thermographs. The Electronic Components keltron are Aluminium Electrolytic Capacitors,

Motor Start Capacitors, Metallised Plastic Film Capacitors, Ceramic Disc Capacitors,

Carbon/Metal Film Resistors, Piezo Electric Quartz Crystals, N T C Thermistors, Power Diodes.

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CHAPTER 2

INDUSTRIAL PROFILE

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CHAPTER 2

2.1 INDUSTRIAL PROFILE

Keltron is one of the few companies in India which manufactures a wide range of

electronics products starting from discrete components to sub assemblies to equipment and

systems. This strength, combined with the technical man power resource in research and

development, product development and turn-key project management, has enabled keltron to

emerge as a total solution provider integrating talent and technology to design workable

solutions to suit specific needs of its customers. The keltron group comprises the holding

company, Kerala State Electronics Development Corporation Ltd and then subsidiary and

associate companies turning out more than hundred different types of products. These products

are marketed through a strong sales and distribution network spanning the entire country, india

eight branch offices located at Ahmadabad, Bangalore, Kolkata, Chennai, Delhi, Hyderabad,

Mumbai and Thiruvananthapuram ensure that the products are backed up by dedicated support

and service. For a technology-driven enterprise like keltron, foreseeing the features need of its

customers is vital for its survival by foreseeing strategic alliance with world leaders, keltron is

poised to maintain a global presence and keep its self abreast of current technology with the

synergy of highly skilled man power and assured access to frontier technology keltron braces it’s

self as a provider of innovative solution meeting the future needs of its customers. Keltron

believes that the future holds more for those who make technology work than for those inventing

it. Keltron management’s corporate vision as a company enters the 21st century is to emerge as a

strong and self reliant business enterprise with customer focus, profit orientation and

professional outlook to fit the company as Rs 500crore company by 2010 with a net profit of

10% sales. Keltron is india’s first and largest electronics corporation in the state sector. Keltron

has been a catalyst in making electronics work in almost every aspects of our daily life, since

1973. Today, we live in a technology-driven world where speed, flexibility, intellectual capital

development and networks have become the basis of value creation as connectivity and

interactive technologies pervade all business activity. In this technology-driven environment,

Keltron finds the assimilation ,adoption and integration of technology in creating innovative

solutions as the very basis of survivial. Keltron has been in making technology work rather than

inventing it. Keltron has been a catalyst in making electronics work in almost every aspects of

our daily life, Since 1973. Keltron’s strength lies in the stable foundation and experience build

20

over the years, its strong human capital, its strong human capital, its nation-wide network and it’s

ability to adapt itself to change. With over a 30 year long track record as manufacturer of

sophisticated electronics devices and systems, Keltron presents itself in the global market as a

one-stop-shop for manufacturing, System integration and after sales support in India. Recently,

keltron has added to its repertoire, a set of knowledge services to foster global competitiveness

for Indian Industry as well as to ensure quicker innovation and an independent division for

project consulting to extend the benefits of its large knowledge capital in the form of

comprehensive solutions to customers in several market segments worldwide.

21

CHAPTER 3

COMPANY PROFILE

22

CHAPTER 3

3.1 COMPANY PROFILE

KERALA STATE ELECTRONICS DEVELOPMENT CORPORATION LTD.

(KELTRON) was incorporated in the year 1972 and started commercial activities in 1973. The

organization was set up as the first electronics industry in Kerala with the objective of promoting

developments in the electronics field. Manufacturing units were set up in various parts of the

State and Marketing Offices throughout India. Subsidiary companies were also started. Main

units manufacture electronic equipments and systems, where as subsidiary companies

manufacture components.

Corporate office of KELTRON (Keltron House) is situated at Vellayambalam in the heart

of Trivandrum city. Keltron has got four manufacturing units, one unit exclusively for dealing

with Information Technology products& software, two Subsidiary Companies and seven

Marketing offices.

It is a technology driven enterprise that manufactures and markets electronic components,

equipments and system for communication , defense, and industrial appllicatios. In a state

characterized by a shy capital investment culture in the industrial sector, the Company assumed

the role of an entrepreneur and setup its own manufacturing units and marketing offices. In its

developmental role, it organized setting up of tiny units in the co-operative sector for assembly

of consumer electronics products, developed small entrepreneurs in the ancillary sector and

promoted joint sector units in the State even with industry majors like Tata Group, Best &

Crompton etc. The company established a good brand image for consumer Electronic Products

and Professional Equipments.

The registered office is Keltron house at Vellayambalam in Thiruvanathapuram. From

within the four walls of drawing room to the vast expanse of an international airport, from the

deep oceans to the realms of outer space, there is a KELTRON product in the form of an

innovative solution.

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The corporation has weathered through extreme changes in the economic and commercial

environment, from highly restrictive government policies involving tedious and time consuming

licensing procedures during its infancy, to the present liberalized policies. Several Corporations

even in Private Sector in Consumer Electronics and a number of State Level Electronics

Companies like UPTRON closed down in this process of transformation. Even after the span of

25 years of its existence, Keltron is still the major company in this State in the Electronic sector.

Though it is in loss for the last ten years, its surviving slowly with efficient management. But

still, miles to go.

Today, Keltron products remain as icons of technology brought to benefit the people

continuing in its quest to bring benefits of frontier technology to its customers. Keltron has

forged strategic alliances with world leaders in trade. Keltron have repositioned itself as a total

solutions provider in Electronics.

With the synergy of highly skilled manpower and assured access to frontier technology,

Keltron braces itself as a provider of innovative solutions meeting the future needs of its

customers. More than offering employment opportunities to people, Keltron has trained and

nurtured many high caliber managers and technical hands who have in turn enlarged the horizons

of a developmental process that it had initiated years ago.

Nearly 4000 employees working in different part of the country are focused on bringing

the benefits of technology to the customers. In some cases, it involves designing entirely new

products. In others, adapting available technology to evolve better solutions.

What distinguishes a customer-oriented Company like KELTRON from others is its

ability to put itself in the customer’s shoes. It is not just a matter of seeking a problem as a

customer sees, but of charting a course for farsighted solutions as well. Every day, technology

spins out an increasing number of options for the customers to choose from. It is only intensive

knowledge, hands on experience and technical expertise that can help make the right choice.

KELTRON’s strength lies in its quarter century of experience, abundance of expertise, and a

sound knowledge base, all equipped to provide the most appropriate solutions to customers.

KELTRON strives for quality in whatever it does. The attention to detail which KELTRON had

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inherited right from the beginning has helped it earn outstanding honours since its infancy in

1973. Quality and reliability of KELTRON products have been endorsed over and over by the

large customer base and ISO 9000.

Mission:

With nearly 2000 employees working all over India, KELTRON carries the effulgent light of

mission to bring the benefit of technology to the common man and thereby contribute to the

development of the Society.

Policy:

KELTRON’s policy to establish a set of standards and to provide uncompromised quality

in whatever it does, keeps it abreast of current technologies in the Electronics and IT industry.

Vision:

Keltron management’s CORPORATE VISION as the company enters the 21st century is:

To be a world-class, growth-oriented electronics corporation specialised in providing

quality, market-focused products, services and cost-effective system solutions to a large

clientele.

To attain leadership position in the knowledge industry by training and utilizing the rich

knowledge capital available in Kerala, and creating a wide technology horizon for the

development of knowledge wares and intelligent systems.

To emerge as a strong and self-reliant business enterprise with customer focus, profit

orientation, and professional outlook.

To build up Keltron as a model PSU in the Sunrise Technology sector of Electronics & IT.

To function as the backbone of electronics industry in the state

To continue to play the role of nodal agency of government for accelerating the growth of

development of this core industry in the state.

Manufacturing facilities located in Kerala, India

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Manufacturing capability: Four fully equipped production facilities of over 500000

sq.ft.area.

ISO 9001:2000 certified.

A regular supplier of custom products to the Departments of Defence and Space to

Government of India since 1980

Fully fledged Marketing Offices in eight metropolitan cities of the country:

Mumbai, Delhi, Chennai, Kolkata, Bangalore, Hyderabad, Ahmadabad and

Thiruvananthapuram Customer Support.

Customer support Centers in all the Districts of Kerala State and also in eight

metropolitan cities of the country : Mumbai, Delhi, Chennai, Kolkata, Bangalore ,

Hyderabad, Ahmadabad and Thiruvananthapuram.

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Land & Built-up area KSEDC owns around 106 Acres of Land and

67,000 Sq.m. of built-up area at thefollowing locations.

Location Land(In Acres) Built-up Area(In Sq.m)

Keltron H. O. 8.1 6500

Keltron IT Business Group,

Vellayambalam, Trivandrum In above 6900

Keltron Equipment Complex,

Karakulam, Trivandrum * 17 15300

Keltron Communication Complex,

Kulathur, Trivandrum * 431 6253

Keltron Controls, Aroor, Alleppey *

(Near Cochin) 16 11400

Transmission Equipment Unit,

Mudadi, Calicut 13.3 1121

Keltron Component Complex ,

Kalyassery, Kannur* 10.9 10721

Keltron Electro Ceramics,

Kuttippuram, Malappuram * 20 2237

ISO 9001: 2000 certified

TABLE 1: LOCATION OF KELTRON

27

The KELTRON GROUP comprises the holding company, Kerala State Electronics

Development Corporation Limited and ten subsidiary and associate companies turning out

more than hundred different types of products. These products are marketed through a strong

sales and distribution network spanning the entire country.

Subsidiaries:

Keltron Component Complex Ltd.

Keltron Electro Ceramics Ltd.

Product Range:

Process Automation Systems

Communication Products

Information Display & Security Systems.

Traffic Management Systems.

Satellite/ Board Casting Equipment.

Office Automation Equipment.

Power Electronics Products.

Strategic Electronics Products.

Electronics Components.

Home Electronics Products.

Information Technology.

All India Presence through Branches at:

Delhi

Mumbai

Calcutta

Ahmadabad

Hyderabad

Bangalore

Chennai

Trivandrum

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3.2 FINANCE DEPARTMENT

Finance department deals with planning, controlling of firms financial resources. It deals

with finding out various sources of raving funds for the firm. The sources must be suitable and

economical for the needs of the borrower.

The finance and accounts of KEC is divided into five functional sections as under:

Cash and Compilation

Purchase accounts

Sales accounts

Costing

Pay roll

The key functions of finance department are

Managing cash and bank transactions

Sales accounting

purchase accounting

Pay roll management

Finalization of accounts

costing and cost accounting

Budgetary control

To meet audit requirements

Statutory payments & accounts

3.3 MARKRTING DEPARTMENT

The marketing department carries out the functions of

29

Retaining a considerable market share

Creating customer satisfaction

Ensuring that the finished products reach the customers at the right place, right time, and

responsible price and is of the right quantity

The marketing department is doing the following functions

Pricing

Credit policy

Sales promotion

Packaging

Distribution channels

Customer satisfaction

3.4 PLANNING DEPARTMENT

The planning department broadly has two functions

Material requisition planning

Production planning and control

3.5 PRODUCTION DEPARTMENT

The key functions of production department are

Production planning

Arrangement for material, tools and instruments

Work allotment

Production monitoring

30

Forward production for line inspection

Rework where required

Reporting of production summary

Evaluate reason for variation in production

3.6 QUALITY ASSURANCE

The key functions of quality assurance are

Inspection of incoming material

Stage inspection of different assemblies

Inspection at suppliers premises

Final inspection of products

Coordination of customer inspection

Some of the objectives of quality assurance are

Reduce the time of incoming material inspection

Reduce the time of stage inspection

Reduce the major customer comments in final inspection

3.7 TESTING

The testing dept does the testing of all printed circuit board, sub assembly and final

products

The key functions of testing are

Receipt of assembled or inspected products

Carrying out functional tests

31

Reporting the functional test status including acceptance, rejections and rework status

Carrying out functional test of reworked products

3.8 PURCHASE DEPARTMENT

The purchase department is connected with raw materials and spares.

The key functions of purchase department are

Verification of purchase requirements

Sending enquiries and getting quotations

Preparing comparison and negotiating with suppliers

Proposing order and approval and releasing the same

Material clearance

Re return in replacement

3.9 SOLAR ENERGY INVERTER

The solar inverter is a critical components in a solar energy system. It performs the

conversion of the variable DC output of the Photovoltaic(PV) module(s) into a clean sinusoidal

50- or 60Hz AC current that is then applied directly to the commercial electrical grid or to be

local, off-grid electrical network. Typically, communications capability is included so users can

monitor the inverter and report on power and operating conditions, provide firmware updates and

control the inverter grid connection. Depending on the grid infrastructure wired (RS-485, CAN,

Power Line Communication, Ethernet) or wireless (Bluetooth, Zignee/IEEE802.15.4, 6loWPAN)

networking options can be used.

3.10 POWER ELECTRONICS UPS

Keltron provides seismic qualified UPS systems of up to 1000 KVA capacity based on

state of the art IGBT technology. Major customers include Nuclear Power Corporation of India

Ltd (Various atomic power plants like MAPS, KAIGA, TAPS, KAPS, NAPS, etc).

32

The Power Electronics Group(PEG) of keltron is a pioneer in the field of UPS system in

the country designing and manufacturing to a diverse range of applications. Keltron is a

preferred vendor for NPCIL, ONGC and GAIL for supply of UPS systems, Battery Chargers,

Rectifiers, Distribution panels and related products

Major Customers of Power Electronics of KELTRON

Nuclear Power Corporation of India Ltd(NPCIL)

Madras Atomic Power Station(MAPS)

Kaiga Atomic Power Station

Tarapur Atomic Power Station(TAPS)

Kakrapur Atomic Power Station(KAPS)

Narora Atomic Power Station(NAPS)

Product Range

IEC 62040 (UPS)

High Frequency IGBT Converters

Rectifiers

Industrial Battery Chargers

High Capacity Voltage Stabilisers

AC & DC Distribution Boards

Static Compensators

AC & DC Drives

33

600 KVA UPS

FIGURE 1: 600KVA UPS

34

3.11 SIGNIFICANT ACHIEVEMENT

First in the country to design and develop 90KVA UPS

First in the country to design and develop 500KVA and 600KVA UPS qualifying seismic

parameters for NPCIL

High capacity UPS system for C & I systems at more than 70 installations of NTPC,

DVC, State Electricity and Process industries.

3.12 GENERAL DESCRIPTION OF UPS

Only the UPS can offer full protection for the priority load from all the line disturbance

and make available absolute continuity and stability in power supply. In the circuitry of the

KELTRON UPS system based on ABB technology, component design and selection are

made to maximize MTBF. Complete modularity in design of sub assemblies and integrated

fault diagnostic indication system assure minimization of MTTR. Allied to these features

fully self supporting functional units achieve genuine redundancy for parallel operation.

The 2*200KVA UPS system consists of 2 identical 200 KVA UPS connected in parallel

for 100% redundancy, support by bypass supply derived through a static voltage stabilizer. In

normal operation UP1 and UP2 are in on condition and share the load equally among them.

On failure of any one of the UPS, the other ups will support the entire load. On failure of the

healthy UPS, the load will be transfer to SVS without any break. The rectifier section will

supply the inverter input current as well as the charging current of the battery. Whatever the

input supply to the UPS goes, the battery will supply the DC voltage required for the inverter

provided in the UPS panel.

The UPS system works on the double conversion principle, i.e. the input AC voltage is

rectified by the front end converter, and then the DC voltage is converted into AC voltage by

the inverter section. The front end converter and rear end converter are build by IGBT

devises and PWM technique is used for the control scheme. The IGBT rectifier ensures near

unity power factor at the input side.

35

3.13 FEATURES OF 600KVA UPS

Indigenously developed high capacity UPS

600KVA single module system

12 pulse charger

IGBT based DWN technology

DC supported by 2250 A12 360V plant battery

132 KW induction motor

IP 31 protection

Fault diagnosis on PCB

3.14 SPECIAL FEATURES OF KELTRON UPS

High Efficiency : An optimum design of power circuit ensures better overall efficiency of the

order of 90-92% for 3 phase UPS and 87-90% for single phase UPS even at partial loads(50%) it

gives better efficiency and this reduce running cost of the system.

Latest inversion : The state of the Art pulse with Modulation technique used optimizes

output filter making system, more compact and light weight.

Automatic Transfer/ Retransfer Facility : System design takes into account the

possible absence of operating staffs. Hence automatic transfer facility is provided.

.

36

CHAPTER 4

DESIGN OF THE STUDY

37

CHAPTER 4

4.1 STATEMENT OF THE STUDY

The project work is titled as “Efficiency Of SUPPLY CHAIN MANAGEMENT of

UPS products in Keltron Equipment Complex, Trivandrum”.

It is intended to analyze comprehensively and understand thoroughly the various SUPPLY

CHAIN services, working and functions of “Keltron, Trivandrum” in order to gain more

knowledge regarding SCM aspects of business in a manufacturing company.

4.2 SCOPE OF STUDY

Analyze the supply chain management of UPS products in Keltron.

To find out the problems in supply chain management and suggest some solutions.

4.3 OBJECTIVES

To Study the supply chain management in KELTRON

To analyze the procedures involved in various stages of supply chain

To improve the efficiency of supply chain management

4.4 RESEARCH METHODOLOGY

Methodology may be a description of process, or may be expanded to include a

philosophically coherent collection of theories, concepts or ideas as they relate to a particular

discipline or field of inquiry.

Methodology may refer to nothing more than a simple set of methods or procedures, or it may

refer to the rationale and the philosophical assumptions that underlie a particular

r study relative to the scientific method. For example, scholarly literature often includes a section

on the methodology of the researchers.

4.5 RESEARCH-PERIOD:

A period from 9st December, 2013 to 15th February, 2011.

38

4.6 RESEARCH-PLACE:

Conducted a study on functioning of KELTRON

4.7 SOURCES OF DATA AND INFORMATION

The collected data and information are from the internal organization report and websites.

The two sources of information are:-

1. Primary data

The primary data are collected by direct observation and from face to face

interview

2. Secondary data

The secondary data are collected from Brochures and catalogues of the company,

Official Reports and website of the company.

4.8 LIMITATIONS

Any work cannot remain untouched with the limitations. This project work is not an exception

and following were the limitations of the study:-

Time was a limiting factor during the study.

Only a percentage of total employees were interviewed.

The workers were very busy in their work and had a little time available for interview

or conversation.

Some core data could not be collected due to confidentiality policies of the company.

39

CHAPTER 5

LITERATURE REVIEW

40

CHAPTER 5

5.1 LITERATURE REVIEW

A supply chain consists of the flow of products and services from Raw materials manufacturers,

Intermediate products manufacturers, End product manufacturers, Wholesalers and distributors

and Retailers connected by transportation and storage activities, and Integrated through

information, planning, and integration activities-Principles of supply chain management by

Daniel A Glaster

The design and management of seamless, value-added process across organizational

boundaries to meet the real needs of the end customer-Institute of supply chain Management and

for Logistics they suggest to adopt the Council of Logistics Management (CLM) definition:

“Logistics is that part of the supply chain process that plans, implements, and controls the

efficient, effective flow and storage of goods, services and related information from the point-of-

origin to the point-of-consumption in order to meet customers’ requirements” (Lambert, Cooper

et al. 1998) .

Kaplan and Sawhney (2000) and Wise and Morrison (2000) both develop frameworks

to understand what types of exchanges would appear for different types of products and

examined how exchanges may evolve.

Jap and Mohr (2002) explore why some firms are successful with e-procurement

strategies while others are not.

Lee and Whang (2002a) model how secondary online markets impact the supply chain.

pyke and Johnson (2002) compare many e-procurement strategies to traditional strategic

alliances.

While e-commerce and e-procurement have captured most of the business press headlines

over the past 5 years, the promise of e-collaboration may be far greater. We define e-

collaboration as business-to-business interactions facilitated by the Internet. These interactions

go beyond simple buy/sell transactions and may be better described as relationships. These

41

include such activities as information sharing and integration, decision sharing, process sharing,

and resource sharing. Lee and Whang (2002b) provide this taxonomy of e-collaboration and link

the idea to earlier research in supply chain management. Of the three areas, information sharing

has seen the most research. With widespread interest in the bullwhip effect (Lee, Padmanabhan,

Whang (1997», many researchers have worked to quantify the impact of the bullwhip (Chen,

Drezner, Ryan, and Simchi-Levi 2000) and examine the benefits of sharing information (for

examples, see Cachon and Fisher 2000; Iyer and Ye 2000; Moinzadeh 2002). There has also

been significant work to understand the benefits of IT investments within an enterprise (for

example, the impact of ERP; McAfee 2002).

E-business is changing supply chains and examine the rapidly evolving research in this

area. Following the framework of Lee and Whang (2002c), we divide the various forms of e-

business applications into three categories: e-commerce, e-procurement, and e-collaboration. e-

Commerce helps a network of supply chain partners identify and respond quickly to changing

customer demand captured over the Internet. e-Procurement allows companies to use the Internet

for procuring direct or indirect materials, as well as handling value-added services like

transportation, warehousing, customs clearing, payment, quality validation, and documentation.

e-Collaboration facilitates coordination of various decisions and activities beyond transactions

among the supply chain partners, both suppliers and customers, over the Internet (e.g.,

coordination of engineering changes in the bill-of-materials for a product that is manufactured by

an outsourced partner).

Vinum and Skjoldager (2001) define e-SCM as a management discipline, which

concerns electronic supply chain integration on a technical, application and business

management level. e-SCM also includes optimization of business processes and resources across

supply chains, from customers to suppliers of products, services or information.

BraBler (2001) believes that it is appropriate to regard the supply chain as a production

network formed of successive customer-supplier links and proceeding through a number of

value-added steps to ensure that either a product or a service reaches the end customer. The most

comprehensive example is when the chain starts in the raw material still to be won from the earth

and ends with the delivery of goods manufactured from it. Thus, e-SCM is a group term that can

be applied when Internet solutions are successfully applied to the management of the flow of all

materials, information and finances along the value-added chain.

42

A global supply chain is a network of factories and material sourcing on a worldwide

basis. Global supply chains are a mechanism by which firms can achieve a competitive

advantage of either low cost or differentiation through the processing activities performed and

their corresponding linkages with suppliers and buyers (Klassen and Why bark, 1994). These

networks have to be carefully managed to improve quality and reduce cost as well as lead-time.

This requires controlling the inbound, outbound and procurement functions (Porter, 1986; Ellram

and Carr, 1994) with a supporting IT-based system (Goonatilake, 1990). In today’s global

marketplace, organisations are faced with ever-changing customer requirements and intensified

competition. To succeed in these challenges, companies are looking at re-engineering their

supply chain through the successful deployment of IT.

Logistics is becoming an important aspect of SCM (Carter and Ellram, 1998) and

improving logistics velocity in turn increases the supply chain efficiency, and so the

performance. Many companies that previously did not devote much time or energy to the

management and understanding of logistics have begun to pay attention (Giuntini and Andel,

1995). Firms have begun to benchmark return operations against best-in-class operators (Stock,

1998). Third parties specialising in returns have seen the demand for their services greatly

increasing (Stock, 1998). General literature in SCM and logistics measure is quite extensive

(Tan, 2001) and a number of papers deal with supply chains. However, much of the literature is

either too general or too specific to a particular country (Sum and Yang, 1993; Simatupang and

Sridharan, 2002; Kemppainen and Vepsaelaeinen, 2003; Msimangira, 2003; Sahay et al., 2003).

In addition, some of the performance measure literatures such as Caplice and Sheffi (1994),

Beamon (1998), Brewer and Speh (2000), Lambert and Pohlen (2001) found highly cited and

expressed the importance of enhanced supply chain performance.

Managing risk in the supply chain has never been as challenging as it is today. As more

companies have outsourced production to overseas locations, supply chains have been extended,

the number of nodes increased, and the complexity of the networks have moved exponentially. In

the past, supply chain managers were mainly concerned with reducing cost, reducing purchase

price variance, and managing inventory. Today, supply continuity is the single biggest business

driver. Indeed, organizations now recognize that “preservation of shareholder value” is of

paramount importance in supply chain management, and it has been assessed that disruptions can

exert a tremendous impact on the company’s overall performance of supply chain operations, if

43

there are not suitable mechanisms or tools able to prevent or smooth their negative effects, as

many real cases have showed in the past few years (Sheffi, 2005)

44

CHAPTER 6

DATA ANALYSIS AND INTERPRETATION

45

CHAPTER 6

6.1 SUPPLY CHAIN MANAGEMENT

The supply chain is the network of organizations that are involved, through upstream and

downstream linkages, in the different processes and activities that produce value in the form of

products and services in the hands of the ultimate customer”

The Supply chain of Keltron starts with raw materials which are purchased from the

vendors are moved to the Store Inwards. As Keltron having several departments like Power

Electronics Group, Special Product Group, Space Electronics Group, each department have

different Store Inward. Then after the raw materials inspection, it is send to the manufacturing

location. After the product is manufactured then it is kept in the store outward. After the

marketing department will take care of the product and they make the products to reach the

customer

FIGURE 2 :SUPPLY CHAIN MANAGEMENT IN KELTRON

46

47

6.2 DESCRIPTION OF THE SUPPLY CLAIN WORKFLOW

The whole process is initiated with the client request (typically for a product). The client

floats a tender with the required stipulations and specifications. In response to that the Marketing

Department of PEG initiates a (tender) quotation comprising of the technical bid and the

commercial bid. The technical bid is formulated in conjunction and with the support of the

Engineering Department. The engineering department also provides a costing form (specifying

the cost of components) to the marketing department. Once the quotation with the client is

finalized, the marketing department issues an ‘ESO’ (equipment stock order) based on the

Purchase Order (PO) and sends it to the engineering department for further actions. Copies of

ESO are also forwarded to the Planning Department, Finance Department and Quality Assurance

(QA) Department as indicated in the diagram. Based on the ESO the Engineering Department

prepares a Mechanical ‘Bill Of Materials’ (BOM) as well as an Electrical BOM and disposes

them along with the design templates and schemas to the Planning Department. The mechanical

and electrical sub divisions of the Engineering Department prepare the respective BOMs. Copies

of the above mentioned BOMs are also sent to the client for further evaluation.

Based on the ESO the materials planning (a sub division of planning department)

department prepares the ‘Purchase Requisition’ (PR) and disposes it to the Purchase Department

.The purchase department prepares an ‘Enquiry Form’ and sends it to list of prospective vendors.

Once the vendor meeting the required criteria is selected (based on the comparative statement),

the Purchase Order( PO ) is prepared and is sent along with the purchase order proposal to the

purchase committee for further approval. Note that if a new PO has to be formulated with a

particular vendor within six months of issuing of the previous PO with the same vendor and the

amount in the new order is less than or equal to that in the previous PO and if the vendor agrees

to the new order then an ‘enquiry form’ need not be send. Instead the new PO (with a repeat

order number) along with previous PO is sent to the vendor. In this case the comparative

statement also need not be prepared as the vendor has already been fixed. The order of approval

of the purchase committee is as follows: Head (purchase), Head (Planning), Head (QA), Head

(Finance), Group Head, Unit Head, Head (corporate finance) and Managing Director (and these

members constitute the committee). If the amount in the PO is less than three thousand rupees

then only the Head (purchase) need approve it. For PO within the range of three thousand rupees

48

and ten lakh rupees the Head (purchase), Head (Planning), Head (QA), and Head (Finance) have

to approve it. For amounts above rupees ten lakhs all the members in the purchase committee

have to approve it. Once the PO is approved it is sent to the Purchase Department which then

forwards copies of it to the Planning Department, Finance Department, Inward store and Quality

assurance Department. There are also provisions to amend the PO.

The vendor then delivers the proposed materials to the inward store. He may deliver the

invoice [delivery Chelan (DC) or Bill] either to the Purchase Department or to the Inward store;

although in the former case a copy of the invoice is forwarded to the Inward store. In any case a

copy of the invoice is forwarded to the Finance department. Based on the procured materials and

invoice appropriate entries are made in the ‘Consignment Receipt Control Register’. A

‘Consignment Arrival Report’ is prepared every day by the inward store and sent to the Planning

Department indicating all the materials that arrived on that day.

‘GRCIR’ (Goods Receipt Cum Inspection Report) is generated at the inward store and

are sent along with the arrived materials to the Quality assurance Department for Inspection.

After inspection the QA Department returns the inspected materials to the Inward Store which

then transports the accepted materials and the copies of GRCIR to the Holding Store. If any

materials are specified defective by the QA department then five copies of discrepancy reports

are prepared by the inward store. One copy is retained here. One copy each of the remaining

copies are sent to the supplier (vendor), Finance Department, Purchase Department and Planning

Department. The appropriate entries are also made in the ‘Rejection Control Register’ residing in

the Inward Store.

The Holding store then keeps one copy and forwards one copy each of the remaining

four copies of GRCIR to the Planning and Purchase departments respectively. It also forwards

the remaining two copies to the Finance Department. The Planning Department then generates a

Stores Requisition (SR) (actually this note is a requisition to issue the specified materials)and

sends it to the Holding Store. In accordance with this the materials then get issued to the

appropriate Production Planning sub-sections (Transformer Winding, plating etc) after making

appropriate entries in the Bin-card as well as in the ‘Store Requisition Issue Control Register’

and then the materials undergo processing in the order specified by the ‘Work Order’ prepared

49

by Planning Department. The materials undergo several stages of testing and QA as indicated

in the diagram. The QA Department generates a test report at each stage. The QA carries out its

modus operandi in lieu with a Quality Plan prepared in connection with the client.

Materials may also get transferred among the sub-sections of Materials Planning Department

using an ‘Internal Material Transfer Note’. Finally all the processed materials are assembled in

the Equipment Assembly sub-section. Materials can also arrive directly from the Holding Store

for assembly. Materials that are surplus are returned to the Holding Store with a ‘Store Return

Note’ (SRN). One copy of it is sent to Quality Assurance Department and the remaining three to

the Holding Store. The store then retains one copy and sends one to Finance and one to planning.

Planning Department generates a ‘Shortage List’ (if necessary) and sends it to the Purchase

Department to help them keep track of the unavailable materials. After equipment assembly,

testing and QA are carried out the client is intimated via the Marketing Department. After client

inspection, the Marketing department is again intimated in order to issue the ‘Dispatch and

Billing Advice’ (DBA) to the Dispatch Department. Two other copies of DBA are sent to

Finance and Planning departments respectively. Dispatch department then ships the finished

product to the client

6.3 PURCHASING

Obtaining merchandise, capital equipment; raw materials, services, or maintenance, repair, and

operating (MRO) supplies in exchange for money or its equivalent

Merchant Buyers-

wholesalers and retailers who purchase for resale.

Industrial Buyers-

purchase raw materials for conversion, services, capital equipment, & MRO supplies.

Purchasing contributes to these objectives by:

– Actively seeking better materials and reliable suppliers,

– Work closely with strategic suppliers to improve quality materials, and

50

– Involving suppliers and purchasing personnel in new product design and

development efforts.

FIGURE 4 : SUPPLY CHAIN OF PURCHASING PROCESS IN KELTRON

PurchasingSuppliers Stategic/ Warehouse

User/ Requistion

Accounting

Start

Material Requisition

Material Available

Material Requisition

MR1

Issue PO

Purchase Order

PO1

Purchase Order

PO1

Delivery Order

DO1Ship Materials

Invoice

INV 1

PO file

Purchase order file

Material Requisition

MR1

Issue material

Material

Accounting information for changing the appropriate dpt

Delivery order

DO1

Material

Delivery Order

DO1

Invoice

INV 1

Yes

No

Materials

MR file

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6.4 SUPPLIER SELECTION

Supplier Scorecard used for the Vijay Electricals

Performance Measure Rating Weight Final Value

Technology 80 0.15 12

Cost 90 0.25 22.5

Quality 95 0.15 14.25

Responsiveness 90 0.10 9

Delivery 90 0.15 13.5

Location 80 0.15 12

Environment 95 0.05 4.75

Total Score 1.00 88

FIGURE 2: SUPPLIER SELECTION

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6.5 PROCEDURE FOR OPERATIONS MANAGEMENT

(PLANNING & REALIZATION OF PROCESSES AND PRODUCTS)

Purpose

To ensure proper planning for the purchase/realization of required products as per the

specifications within the target date and execution of Customer Orders pertaining Power

Electronics Group

Scope

All Customer Orders received and executed by Marketing.

Procedure

Planning of Processes and Products

a. Receipt of Customer Order and Release of Purchase Indent.

Based on Customer orders received from Marketing, Order Acceptance (OA) (R-1) is prepared.

OA acts as the key document for all the activities for execution of Customer Orders.

Based on OA, Purchase Indent (R-2) is issued to Purchase Department for procurement. OA

Number holds an over riding priority over the PI No and hence the same is considered as the

Reference No for all purposes. OA register (R-3) is maintained which includes order details,

execution details and collection details.

HOD Planning evaluates criticality of OA based on the priority of customer and total order

value.

Operational Planning and Control Register (R-4) is maintained as soft copy to monitor the

prompt execution of order and payment collection.

Target date mentioned in the Purchase Indent does not act as the realistic date (either date

mentioned by the customer or delivery schedule mentioned in the offer is the expected date of

purchase) owing to the fact that the same is preponed and indicated for pressurizing suppliers

through Purchase Department.

53

b. Follow up for Purchase and Realization of Products

Based on the criticality status assigned (R-4), follow up is carried out with the Purchase

Department for the timely delivery of products as against the Order Acceptance /Purchase Order.

In case of delay, Planning Department evaluates (R-4) the reasons and proposes appropriate

corrective action (R-4) based on the severity of the delay with respect to the purchased products

in the order execution process.

Execution of Orders

a. Receipt of Products

On receipt of products accepted vide Goods Receipt Cum Inspection Report (GRCIR) from

Stores, Dispatch Billing Advice (R-9) and Delivery Challan (R-10) are prepared by Planning and

forwarded to Stores, QA and Finance Departments. Based on Dispatch Billing Advice, Finance

Department prepares Invoice.

b. Acceptance of Products with Deviation

Those products having minor variations from the stipulated specifications /tolerance limit are

accepted with deviation by QA Department based on the Acceptance with Concession Report

(R-25) approved by Head (PEG) after concurrence with Account Executive and Head

(Marketing).

Dispatch

a. General

Dispatch Billing Advice (R-9) and Delivery Challan (R-10) are prepared by Planning and

forwarded to Stores, QA and Finance Departments. Products along with copy of the Invoice/

Delivery Challan are delivered to the customer (consignee located at different areas) by Stores

and acknowledged copies of Delivery Chelan /Invoice received/collected by Stores is forwarded

to Planning Department.

54

b. Direct Dispatch to Customer site

Heavy products such as High capacity UPS etc./bulk quantity of products will be supplied

directly to customer from supplier vide our Delivery Challan issued to the supplier as instructed

in the Purchase Order in consultation with Planning. On receipt of the acknowledged copy of the

Delivery Challan from the supplier, Dispatch Billing Advice will be raised for regularization.

c. Partial Dispatch

In some other cases, part of the ordered products has to be dispatched for meeting the customers

immediate requirements. Delivery Challan is generated for the interim dispatch and will be

regularized by raising Dispatch Billing Advice once the supply is completed. In this situation, a

Proforma Invoice (R-11) is prepared and forwarded to Stores for transportation purpose.

Proforma Invoice is also used for part payment purpose.

Sales Reversal

Any product which is sold but not accepted by the customer due to reasons like order

cancellation, Model changes etc is to be returned through Sales Reversal Advice (R-12)

generated by Planning Department, received by Stores and inspected by QA. Subsequently the

same is accounted in the Stores along with GRCIR. Stores forward Sales Reversal Advice and

GRCIR to Finance Department through Planning Department for raising Credit Note (FIN/R-1).

Receipt of Payment

On completion delivery, delivery certificate (CSG/R-2) evidences for installation will be

collected and the same along with Invoice are forwarded to customer through Marketing

Department for realization of payment.

Payment Realization

Cheque/DD/Cash received at Planning Department is recorded in the Collection Register (R-14)

and forwarded to Finance Department through Payment Forwarding Advice (R-15). The stamped

receipt of the payment received from Finance Department is forwarded to customer.

6.6 PRECAUTIONS

55

It is very essential to ensure that sufficient lead-time is available for arranging products to deliver

to customer against their delivery schedule as specified in the order. If sufficient time is not

available, it is necessary to take up with customer for delivery extension or waiving LD Clause.

To ensure products are available in Stores before raising Despatch Billing Advice/Delivery

Challan.

To ensure that the despatched products are delivered by courier/our representative to the

customer and obtain acknowledgement.

To ensure the specifications of products in the PI are one and the same as that specified in the

customer order. On the other hand, deviation in this regard from customer is obtained before

effecting despatch.

Amendments, if any from the original offer are to be identified and intimated to Marketing

Department, before raising Purchase Indent.

To ensure sufficient margin is available on products indented to Purchase. If not, the

low/negative margin products may be brought to the notice of Marketing Department for taking

up with customer for enhancing the price, as required.

To ensure all payments are properly and systematically followed up with Marketing Department

and simultaneously entered in the debtor statement.

6.7 MEASUREMENT, ANALYSIS AND IMPROVEMENT

Power Electronics Group plans and implements the monitoring, measurement, analysis and

improvement processes needed

a. to demonstrate conformity to product requirements,

b. to ensure conformity of the quality management system, and

c. to continually improve the effectiveness of the quality management system.

This includes determination of applicable methods, including statistical techniques, and the

extent of their use

56

6.8 MONITORING AND MEASUREMENT

Customer satisfaction

As one of the measurements of the performance of the quality management system, the

organization monitors information relating to customer perception as to whether the organization

has met customer requirements. The method for obtaining and using this information is

determined.

Internal audit

The organization conducts internal audits at planned intervals to determine whether

the quality management system

a. conforms to the planned arrangements, to the requirements of ISO 9001:2008 Standard and

to the quality management system requirements established by PEG, and

b. is effectively implemented and maintained

An audit programme is planned, taking into consideration the status and importance of the

processes and areas to be audited, as well as the results of previous audits. The audit criteria,

scope, frequency and methods are defined.

The selection of auditors and conduct of audits ensure objectively and impartially of the audit

process. Auditors do not audit their own work. A documented procedure is established to

define the responsibilities and requirements for planning and conducting audits,

establishing records and reporting results.

Records of the audits and their result are maintained. The management responsible for the

area being audited ensures that any necessary corrections and corrective actions are

taken without undue delay to eliminate detected nonconformities and their causes. Follow-up

activities include the verification of the actions taken and the reporting of the verification results.

57

6.9 ANALYSIS OF DATA

PEG determines, collects and analyses appropriate data to demonstrate the suitability and

effectiveness of the quality management system and to evaluate where continual

improvement of the effectiveness of the quality management system can be made. This

includes data generated as a result of monitoring and measurement and from other relevant

sources. The analysis of data provides information relating to

a. customer satisfaction

b. conformity to product requirements

c. characteristics and trends of processes and products, including opportunities

for preventive action.

d. suppliers

Improvement

PEG continually improves the effectiveness of the quality management system

through the use of quality policy, quality objectives, audit results, analysis of data,

corrective and preventive actions and management review. KPI, colour indicators,

attribute % etc established vide objectives provide evidences for continual

improvement.

Corrective action

PEG takes action to eliminate the cause of nonconformities in order to prevent recurrence.

Corrective actions appropriate to the effect of nonconformities encountered are taken. A

documented procedure is established to define requirements for

a. reviewing nonconformities (including customer complaints)

b. determining the cause of nonconformities

58

c. evaluating the need for action to ensure that nonconformities do not recur

d. determining and implementing action needed

e. records of the results of actions taken.

Preventive action

PEG determines action to eliminate the causes of potential nonconformities in order to

prevent their occurrence. Preventive actions appropriate to the effects of the potential problems

are taken. A documented procedure is established to define requirements for

a. determining potential nonconformities and their causes

b. evaluating the need for action to prevent occurrence of nonconformities

c. determining and implementing action needed

d. records of the results of actions taken, and

e. reviewing the effectiveness of the preventive actions taken

59

6.10 QUESTIONNARIE TO IMPROVE THE EFFICENCY OF SUPPLY

CHAIN MANAGEMENT

Attributes Improve Start Implementing

Satisfied Already

Not appropriate

Close partnership with suppliers 1 9

Close partnership with customers 1 9

JIT supply 10

e-procurement 6 2 2

EDI 5 1 2 2

Outsourcing 2 1 7

Subcontracting 10

3PL 6 3 1

Plan strategically 1 9

Supply Chain Benchmarking 5 2 3

Vertical integration 4 2 2 2

Many suppliers 3 7

Holding safety stock 5 5

Use of external consultants 7 3

FIGURE 3 :QUESTIONNAIRE FOR EFFICIENCY OF SUPPLY CHAIN

60

CHART 1: EFFICIENCY OF SUPPLY CHAIN 1

CHART 2: EFFIENCY OF SUPPLY CHAIN 2

61

CHART 3: EFFIENCY OF SUPPLY CHAIN 3

Interpreation

From this it is clear there is lot of improvement needed in the real time transaction of

information.This clearly shows there is lot of improvement needed for the e-procurement and

Electronic Data Interchange.JIT supply are satisfied already.

6.11 IMPLEMENTATION

Internet has had and is having a significant impact on the way companies are conducting

business. Internet has created the opportunity to access and share information across the supply

chain in a faster and more reliable way. It provides common communication protocols and

standards for system inter-operability, enabling reliable and low-cost inter business connectivity.

This flow of information leads to the improvement of productivity, the increase of efficiency and

the achievement of better collaboration between the supply chain partners. However, to take full

advantage of the Internet, businesses must restructure their internal and external processes across

the supply chain and improve their collaboration.

62

Filling Status

6.11 ELECTRONIC SUPPLY CHAIN MANAGEMENT

FIGURE 5 : ELECTRONIC SUPPLY CHAIN MANAGEMENT

e-SCM is much more than implementing a piece of software. e-SCM must address the

following five performance drivers

1. Strategy – e-SCM focuses on managing the horizontal flows of information, materials and

funds along the supply chain. These flows represent the core processes of business. To manage

these flows effectively requires an environment of trust and cooperation with supply chain

partners. The culture of trust and cooperation will enable managers to execute best practices such

as collaborative planning and vendor-managed inventory.

e-SCM

Ware House Government

Rules and Regulation

Banks

Carriers of Transportation

Suppliers

Company

statusPO Invoice StatusStatus

PO Invoice

Consignm

ent S

taus

PO status

Customs

63

2. Processes – It costs at least five times more to attract a new customer than to retain an existing

one. It is e-SCM that determines whether or not can fulfill promises to customers and, whether

customers will consider corporate to be worthy of future business when they compare corporate

to the competitors. e-SCM must:

start with the customer and his/her requirements.

have a strong foundation of planning and execution.

be “e“-enabled to compete in today’s business environment.

Companies often do not give the e-SCM process the right level of priority. Make sure that e-

SCM process design is a key part of business plan both as a competitive differentiator and cost

reduction opportunity.

3. Systems – These are the tools that enable organization to realize e-SCM strategies, processes

and goals. The systems dimension is most successful when managers integrate the best available

standards within each of the following categories: Enterprise Resource Planning (ERP), Supply

Chain Planning (SCP), Data Warehousing (DW), Customer Relationship Management (CRM),

eCommerce (eC), and Enterprise Application Integration (EAI).

4. People – None of e-SCM strategies, processes, systems or goals will be achieved without

people of organization. It is critical that the organizational structure, training, development and

compensation be transformed to support the e-SCM process with a new organizational attitude.

Not only must managers consider employees, but managers must also consider customers,

suppliers and other business partners.

5. Goals – Over the long run, primary e-SCM objective is to maximize company’s e-SCM return

on investment as a contribution to shareholder value. To do this requires setting goals in the area

of customer service levels, supply chain assets and supply chain costs. However, e-SCM is

feasible only when value is created for all of the partners along supply chain. e-SCM does away

with old style “zero sum“ thinking and emphasizes the importance of “win-win“ thinking.

DISADVANTAGES OF MANUAL SCM

Time Consuming is large

Chances of Human error

Paper work results in need of lot of space to keep the data

Not more than one person can access data at the same time

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BENEFITS OF E-SCM

Supports exchange of real time information

Platform independent

Web visibility & processing capability 24/7

It requires less storage space

Return on investment

It has open internet application architecture which allows for Rapid deployment &

scalability combining unlimited users in real time environment

Incorporates broadcast & active messaging

6.13 FINDINGS

Keltron produces high quality products but at a comparatively higher price than itscompetitors.

Keltron has a very good brand image among the public due to the best quality consumer products.

Store functions are carried out manually which is tedious task that shows a gap between the process and operations.

New marketing strategies have to be done to attract new customers.

There is limited scope for product diversification.

Lack of promotional activities.

6.14 SUGGESTIONS The company should try to use its production capacity to the maximum.

The company should try to sell its products at competitive price.

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Keltron needs to automate its procedures to effectively promote, maintain and satisfy

customer requirements promptly. E-Supply Chain Management like software may be

implemented to control all activities of Supply Chain in Keltron.

New marketing strategies have to be done to attract new customers.

Skilled workforce must be hired for the organization.

Funds should be made possible for the technology up gradation.

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CHAPTER 7

CONCLUSION

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CHAPTER 7

7.1 CONCLUSION

A nation’s future and its ability to compute in the global market depend on how it

generates new ideas and innovations in science and technology. Keltron has initiated steps to

manufacture and promote high quality UPS to its consumers. But, Keltron can be more efficient

by adopting various methods. Customer expectations are increasingly demanding. More

customers are expecting immediate responses from enquiries. These expectations can only be

met if reliable and real-time information is readily available. The supply chain management

should be dealt with highly skilled labors, thereby making use of its resources most effectively

by reducing the time consumed in delivering its products to the consumers as this can in turn

bring prosperity to the organization. If there is an implementation of e – SCM the time can be

consumed and the disadvantages of manual SCM can be overcome .

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REFERENCES

1. Badoc J., “The Context of E-Supply Chain Management,” Industrial Management,

September-October, 2001.

2. Ross D. F. (2003) Introduction to e-Supply Chain Management: engaging technology to build

market-winning business partnerships, St. Lucie Press, USA, Florida.

3. Pastuszak Zbigniew (2004) The Philosophy of Supply Chain Management in the New

Economy: Net Readiness in the Net Supply Chain, Managing Global Transitions

4. Vinum, T. and Skjoldager, N. (2001) State-of-the-Art Electronic-based Supply Chain

Management and the Development of an e-Supply Chain Strategy Optimization Model,

Copenhagen Business School, Copenhagen.

5. Anderson, D. L., and Lee, H. L. (1999) Synchronized Supply Chains: The New Frontier. In:

D. Anderson (ed.), Achieving Supply Chain Excellence Through Technology, Montgomery

Research, San Francisco, CA.