NMIMS

OPERATIONS MANAGEMENT
APPLICABLE FOR JUNE 2020

1. List down briefly the various inventory management techniques prevalent in the
industry. Discuss how some of these techniques would be applicable to a Medical Store in
effective management of their inventories, i.e medical supplies.

Answer:
An unused asset of any sort, which has impressive potential in value,is named as stock.
Stock is a rundown of products (both completed and semi-finished),work in progress and
crude materials that are held in stock bybusiness associations. Organizations use stock so as
to fulfill thefuture needs underway, fix, support, development, etc.Inventory is considered
as one of the most significant resources of anorganisation. A successful stock administration
is imperative for bothmanufacturers and administration associations, however fabricating
sectorsmaintain more stock than administration firms.

Stock administration is one of the most testing duties ofmanagers in each association. A
proficient stock administration assumes asignificant job in controlling the activities of
assembling businesses.Improved client support, expanded stock turnover, diminished
costsand expanded benefit are the positive consequences of a viable
inventorymanagement. Practically all organizations go through enormous aggregates of cash
for maintaininginventories.The errand of dealing with the stock is a consistent procedure.
For instance, amanufacturing organization needs to stock different sorts of stock for
theirmanufacturing activities. Henceforth, there is a need to stock required level ofinventory
to complete the assembling procedure ceaselessly. Therefore,an powerful administration is
required not for one day or one month however for along period. Stock administration
begins when an association beginsproduction and requests crude materials, semi-completed
merchandise, or othercomponents from the provider. For a retailer, the procedure of
inventorymanagement begins when the retailer puts in the primary request with
thewholesaler.

Stock administration procedures

ABC investigation: The absolute stock of an organization may have both important and
invaluableitems. Contingent upon their worth, the high esteemed stock is given
moreimportance than the low esteemed stock by the organization. ABC systemmeasures
the value of every thing of inventories. The most noteworthy esteemed itemsare delegated
"A stock" and would require greatest control andmonitoring. The most minimal esteemed
stock things are delegated "C inventory"and require the least control and observing. Class "B
stock" requirescontrol and observing which falls between the other two classifications.
TheABC framework is likewise notable as control by significance and choice.

The ABC characterization advancement is an investigation of an assortment of items,such as

completed items or clients into three classifications:

1. An: exceptional significance in esteem

2. B: normal significance in esteem

3. C: relatively immaterial in esteem (as a root for a control plot)

Each gathering is kept up and taken care of in an alternate manner. More importanceis
given to class A, less to B, and lesser to C. The ABC categorisationsystem attempted to order
the stock things according to the yearly deals level. Thishelps the organization to order
those things which are little in number butaccount for the vast majority of the business
volume. This implies the board needs

to assess, comprehend, direct and control these things in need foreffective stock
administration.
Imperative, Essential and Desirable (VED) characterization method: The VEDclassification
isolates inventories into three classes in the decreasingorder of their criticality. In the VED
arrangement, V represents indispensable itemswhose deficiency may hamper the creation
procedure. Thusly, V itemsshould be put away adequately to keep up smooth business
activities. Edenotes basic things that are respected irreplaceable for efficientbusiness tasks.
Hence, the association must guarantee the adequateavailability of E things. D represents
alluring things that don't influenceproduction immediately however availability of such
things would prompt moreeffectiveness. The VED examination can be entirely important to
capital-intensiveindustries.

Quick Moving, Slow Moving and Non-Moving (FSN) classificationtechnique: This method
depends on the example of issues from thestores. This grouping helps in knowing the out of
date things and thuscontrolling them. For conveying the FSN investigation, the last date of
receipt orlast date of issue is taken to decide the quantity of months that haveelapsed since
the last exchange. This examination helps in looking into thesurplus things and non-surplus
things. It is imperative to survey the N things toknow why they are in the immobile class.
There might be severalreasons why a thing has in to the N classification. One reason is
thatthere may have been an adjustment in innovation or change in the specificationof a
specific extra part or the thing may never again be being used.

Stock administration strategies for clinical store

ABC investigation:

Clinical stores may utilize ABC investigation method to deal with the stock. Here the clinical
stores can compute yearly utilization of the considerable number of medications. The yearly
utilization of the considerable number of medications can be determined in the wake of
increasing unit cost by yearly consumptionand the subsequent yearly use of individual
things ought to be organized in diving request. Subsequent stage is to compute the things
total expense of the considerable number of things, as wellas the combined level of use and
the aggregate level of number of things. The medications at that point will be ordered into
three classes: A, B and C, basedon the total cost level of 70%, 20% and 10%,respectively.
VED investigation:

Criticality investigation of the considerable number of medications in the clinical store ought
to be directed and afterward these medications will be arranged basedinto three gatherings.
Those medications which are fundamentally required as the life-sparing medications and
those that must be availableat all occasions were remembered for theVcategory. The
itemshaving lesser criticality needs just as those that might be accessible in the medical
clinic will be remembered for theEgroup.The things with least criticality, or those whose
short-age may not represent a danger to the strength of the patients, must be remembered
for theDgroup.

2. In the competitive business environment, there is a lot of strategic pressure on

established companies to compete with the cheaper substitutes as well as maintain
quality at the same time. Also there is a recent trend amongst consumers for "first copy/
duplicates" of branded products. Why do you think that these so called "Chinese
manufacturers" are able to make products cheaper than most other products available?
Also how do you think can competing and maintaining quality be achievable for
companies for original branded products like Cadbury, Rayban, etc to tackle the other
duplicate products?

Answer:
The current day world is frequently called as a level world in light of upheaval intransport,
correspondence and innovative progression. The current dayenvironment wherein the
business undertakings work is so unique andfast-changing that the business ventures are
discovering it incredibly difficultto work. There are elevated level of vulnerabilities, dangers
and constraintsfrom various quarters and because of this business organizations are finding
itextremely hard to survive.In the profoundly unique business condition today, organizations
contend witheach other for the client's consideration just as the piece of the overall
industry. Forcapturing the essential piece of the overall industry and holding its lead
position,each organization needs to investigate its own qualities and shortcomings
andevolve a business methodology. So as to accomplish a harmony among itsinternal and
outside condition and develop an appropriate system, it isimportant for the organization to
enjoy key arranging and the board.

It is significant for the business to embrace key making arrangements for severalreasons.
Due to the ever-changing business condition, the business hasto be prepared to meet the
adjustments in the inner and externalenvironment. The adjustment to change is conceivable
just if the organizationplans its exercises ahead of time. In this way, arranging causes the
association toadapt to abrupt changes in the economic situations and meet the
challengeshead on. Directors need to rapidly adjust by altering theorganizational exercises
to suit the outer conditions. Arranging assumes acrucial job for the association's adjustment.
Key arranging helps toremove existing challenges and foresee future issues, along these
lines pavingthe route for molding the association to address the issues.

Indeed the facts demonstrate that Chinese organizations offer items at a lot less expensive
rate when contrasted with different makers. We discover first duplicate of practically totally
marked items which are fabricated in China. The principle credit for accomplishment of
Chinese industry ought to be ascribed to the appropriately arranged and definitely executed
strategies of the Government. The Chinese Government started insightful systems when
they chose to open the entryways of their economy to outside organizations/speculators
somewhere in the range of three decades back and have steadily upheld the assembling
environment at their end.

The expense of wages has risen reliably in China in most recent couple of years and today it
is equivalent to most rising economies of the world. Be that as it may, the improvement in
profitability of work power in China is maybe higher than some other spot because of
proceeded with accentuation on aptitude advancement programs for the work power
conveyed by their legislature just as industry. The higher efficiency and not lower wage
structure in this manner is the explanation behind the seriousness of Chinese
products.Chinese government doesn't tie itself with Intellectual Property issues. They
permit the business to duplicate the items grew effectively somewhere else on the planet.
They even fare products at lower rates than their expense in China itself to profit the
advantages. This is named as dumping in worldwide exchange. The less expensive Chinese
items is making serious harm the nearby assembling units of the bringing in nation huge
numbers of which are constrained to in the end close their tasks and accounting for
additional imports to fulfill the neighborhood needs. Chinese government is known to
encourage such exercises by their nearby industry disregarding the fights raised by
numerous nations.

To rival these Chinese makers, marked organizations should attempt underneath referenced
ways:

Register your trademark in China without a moment's delay: Chinese law secures protected
innovation, yet just if a trademark is formally enrolled. When your trademark is formally
enlisted in China, you can make legitimate move against fakes—however not previously.

Keep up your great quality: To offer rivalry to these Chinese players, unique brands ought
not bargain with the quality else they will lose their valuable clients. They should figure
distinctive advertising procedures to remain in the market and pull in clients who are hoping
to purchase unique items.

Discover great assets and keep the cost low: If marked organizations can discover assets
effectively and viable way, they can keep the general cost low and it will at last outcome in
the last cost of products which will be low. Purchaser can get the first item at low cost.

Recognizable: In request for any innovation to succeed, it must beimplemented at the most
essential level-for example the very item that issold in the commercial center. The best
achievement as far as interdictionand discouragement against misrepresentation can
possibly happen when a brand owner'sproducts are unmistakably recognizable from fakes
and knockoffs. The job of the innovation arrangement ought to be to extraordinarily
facilitatethat differentiation which thusly gives an away from regarding ananti-forging sway.
Mechanical help: With the approach of innovation, brands can exploit to check forging
utilizing clear highlights. There are numerous product accessible which discharge item data
and brand proprietorship subtleties when the item scanner tag is filtered. Actually, the
Smart Consumer application from the Department of Consumer Affairs fills a similar need.

Based on above conversation, it very well may be said that, Chinese organizations are
replicating practically all the marked items and giving it inexpensively. To stop and handle
this, brands should use previously mentioned systems. Copy items may draw in the clients
yet in the event that they discover any issue in the item, at that point they will come back to
the valid brand for the arrangement so copy items can't save the clients for long and marked
organizations should concentrate on keep up the quality to hold the old clients and pull in
new clients.

3. ABC Ltd is a leading corporate in India in FMCG. After an extensive research by their
Marketing department they found out they should diversify into Foods & Beverages. The
top management decided to get in the manufacturing of a coconut flavoured soft drink
and a coconut flavoured milk based drink. Pumping capital in the venture into the
business is not a major concern for the company as they have many regular investors on
hand. The company would like to have a major presence with a pan India distribution
network
a. Do you think the idea of getting into the business of a coconut flavoured drinks a
feasible business/ product on for a FMCG company? Give your views with reasons.
b. Assuming that the business idea would have a very encouraging response, suggest a
suitableplant location to set up the beverage manufacturing. Give reasons for the same.

Answer:

an) Entrepreneurs have the ability to adjust the economy, businesses and market
circumstances. They imagine new items and furthermore attempt to build up the current
items and item plans. They attempt to accomplish the ideal objective inside the casing work
of business/social morals. Numerous advancements have changed the general public and
modified its living example. There are numerous sodas accessible in the market which are
very well known among the clients. At the point when you enter in a well known market, it
is hard to enter in any new portion. It is generally simple for a business person to enter in
previously settled market to begin any business. This coconut enhanced soda pops thought
looks great as seasoned sodas are sought after nowadays.

To choose the attainability of this business, we ought to think about the focal points and
weaknesses.

Preferences:

Huge market to investigate: The greatest preferred position organization will get is huge
market of this new item which is holding back to be investigated. In the event that our
thought picks up footing, at any rate at an underlying stage we will be the main ones
contribution this item or administration. As it were, toward the starting our thought will be
a piece of an imposing business model or something near it. At the point when we are the
initial ones, nobody can remove this bit from us. Later on, when we need to rival different
organizations, we can tell the world that we were the initial ones, the first ones. In a
promotion crusade, these words can be very ground-breaking.

A lot of time: When you are the first in the market you have the upside of time, which can
be in months, ideally years. This head start will give you the upside of knowing the business
and your customers, their requirements, how they purchase and the sky is the limit from
there. The opposition should become familiar with this, which will take them time and cash.

Drawbacks

Odds of disappointment: When you are fabricating any new section in the enormous
market, you must be extremely careful and plan your methodology in like manner.
Ordinarily, business people concoct different creative thoughts however absence of
arranging and showcasing abilities influence them and they get a disappointment.
Loads of exertion: When you are constructing any section of the item, you need to work day
and night easily. Initial one that entered the market, need to put forth an incredible attempt
to make the market, which most likely was costly and it requires some investment to get
results.

In view of the above conversation, I can say that sodas industry is extremely large today and
if shoppers get great item which fulfill their requirements, they will come to you without a
doubt. Organization's strategy is acceptable and imaginative which has extraordinary
potential in not so distant future as individuals simply get typical soda pops all over, in this
situation, this coconut flavoureddrink will be a good thought and ought to be prevailing
among people in general yet he needs to sit tight for quite a while to taste the achievement.

b) A plant area can't be changed oftentimes since an enormous capitalneeds to be

contributed to construct the plant and apparatus in the chose area.Therefore, before
choosing a plant area, a long range determining is to bemade to predict the future needs of
the company.Location choices are made based on boundaries which make itsuitable for
different contemplations of providers and markets. There are different elements which
impact the choice while picking plant area. Perfect plant area for refreshments assembling
ought to have a few offices referenced underneath.

Plant determination rules

The general factors that impact the plant area are recorded as follows:

Accessibility of land – Availability of land assumes a significant job indetermining the plant
area. On a few events, our plans,calculations and estimates recommend a specific zone as
the best to startan association. In any case, accessibility of land might be being referred to.
Insuch cases, we should pick the second best area.

Accessibility of data sources – While picking a plant area, it is veryimportant for the
association to get the work at the perfect time and goodquality crude materials at great
characteristics. The plant ought to be found:
• Near to the crude material source when there is no loss of weight

• At the commercial center when there is lost load in the material

• Close to the market when generally accessible, in order to limit the transportation
cost

Closeness to commercial centers – Organizations can decide to find theplant close to the
clients' market or a long way from them, contingent on the item they produce.

Correspondence offices – Communication office is likewise an importantfactor which

impacts the area of a plant. Locales with goodcommunication offices to be specific postal
and media transmission linksshould be given need for the choice of destinations.

Foundation – Infrastructure assumes an unmistakable job in choosing thelocation.

Transport – Transport office is an unquestionable requirement for office area and design
oflocation of the plant. Opportune flexibly of crude materials to the organization andsupply
of completed products to the clients is a significant factor.

Government support – The elements that request extra consideration forplant area are the
strategies of the state governments and nearby bodiesconcerning work laws, construction
standards, and wellbeing.

Lodging and entertainment – Housing and diversion factors alsoinfluence the plant
location.Locating a plant with the offices of goodschools, lodging and amusement for
workers will have a greaterimpact on the association. This factor is by all accounts
immaterial, buthave a distinction as they propel the representatives and thus thelocation
choices.