OPERATIONS AND SUPPLY CHAIN MANAGEMENT PROJECT

Student Name: Amey Kapshikar

Roll No: 17041823038

• What to Achieve:
To reduce NVA time and resources in “Customer Service” environment/workflow in a
technology company which supplies visual display solutions to customers like Multiplex
owners, rental staging companies and Hospitals.

• Problem Statement:

o This technology company has a local “Warehouse” and “Depot Repair” based out of
Noida, Uttar Pradesh, India.

o The “Warehouse” and “Depot Repair/Main Office” is around 1 kms away from each other.

1 KM Distance

o Incase of any failures, customers/partners send faulty parts to Company Warehouse.

o Problem No. 1: Warehouse generally receives the faulty part physically in an ERP system
(SAP) by checking the Work Order details on the shipping documents. At times these
documents do not have Work order / Ticket No and hence a manual check with
customers is required to be done. Until and unless the details are not received,
Warehouse team cannot receive the faulty part in ERP system and hence the same
cannot be sent for repairs. This may take 1~2 days.

This causes delay (WAIT TIME) in repair cycle and hence impacts support timelines to
customers.
o Problem No. 2: Warehouse accumulates 5 – 10 faulty parts and then plans a vehicle/truck
to carry faulty parts to “Depot Repair”.
Warehouse does this to save transport and labour cost required to move the faulty parts
to Depot repair.
Sending faulty parts frequently in the week will lead to more cost associated with it. This
will result in overall reduction in Profit Margin in long run.

Transport Cost from Warehouse to Depot Repair – Rs. 1700/-

Labour: - 700 rupees per head. Total of 3 person required. So total cost: Rs. 2100/-

Note: This part is approx 55KG’s and is transported in a flight case. So it needs a big
commercial vehicle to transport.

But waiting for faulty parts to accumulate takes approximately 5 Business Days and
therefore, causes delay impacting customer support.

o Problem No. 3: Depot repair keeps a small amount of spares in their stock which are
required to repair the faulty part. But at times, more spares or a specific spares are
required that might not be available at “Depot repair”.

To get required spares, someone has to again plan a vehicle or hand carry parts from
warehouse to depot repair. This may again take half a day time subject to
person’s/vehicle’s availability.

This again causes delay in repair timeline.

o Problem No. 4: Once the part is repaired, Warehouse team again plans a vehicle to
pickup the repaired units in a lot of at-least 2~3 repaired parts.

Repair time for 1 faulty part is 1 working day.

Therefore, until 2~3 units are repaired, Warehouse does not pick up the parts and
therefore again due to this “WAIT Time”, there is delay.

So if we see that there are delays at every point due to which NVA Time increases.
Non Value Added Time. Waste (Waiting Time, Transport Time)
• Proposed Solution to reduce Non Value-Added Time:

o Solution for Problem No. 1:

To reduce delay caused by Work order information not available readily while receiving
the faulty part in ERP system, I suggest using “Bar Code” system.

Before shipping replacement part to customer, Warehouse will affix “Bar Code” sticker on
the box of the part which denotes Ticket Number and Work Order number for which the
replacement part is being sent to customer.

Customer sends the faulty part in the same box back to Company Warehouse. Warehouse
team will scan the Bar Code sticker on the box and will immediately acquire the Ticket No
and Work Order number associated with it.

By doing this, we eliminate delay i.e. “WAIT TIME” of 1 or 2 days caused by “Problem No.
1”.

Also, by doing this the hassle of Warehouse operator is reduced making the process
smooth.

This also helps to reduce space occupancy by faulty parts in the Warehouse.
o Solution for Problem No. 2, 3 and 4:

Problem mentioned in point no 2, 3 and 4 is due to transport time, cost and labour cost for
movement of parts.
Therefore my suggestion is bring together the Company Warehouse and Depot repair by
bringing them under the same roof / in the same building.
Also, the layout to be prepared in such a way that the Warehouse and Depot Repair are in
close proximity, so that the parts to be repaired and parts which are already repaired can be
moved between the 2 departments using trolleys.
Proposed Layout:

Testing Room Warehouse

Alignment
Room Repaired Stock

Repair room Faulty Parts

Admin Room & Temp

parts holding room.

➢ Using the above proposed solution, we eliminate the need of transport vehicles and
cost associated with it to move faulty parts to depot repair.

➢ We also eliminate the need of hiring temporary labour to load and unload faulty
parts as now the faulty part can be carried on trolleys between “Warehouse” and
“Depot Repair”

➢ Since Depot repair and Warehouse will be in close proximity, movement of spare
parts from Warehouse to Depot Repair will be easier with almost no “WAIT TIME”
• Expected Outcome:

o By implementing the above 2 solutions proposed, the following is achieved:

➢ Using “Bar Code” System to read/access Work order details, WAIT TIME caused can
be eliminated.

➢ WASTE due to cost required to move faulty parts and spares required to repair the
same can be eliminated.

➢ WAIT TIME which was caused at Warehouse for parts to accumulate can be
eliminated. Saving approximately 5 business days.

➢ WAIT TIME which was caused wait for spares for repairing faulty parts at Depot
Repair can be eliminated.

Throughput Time

Depot Repair

Restock of
Faulty Parts from Physical Testing
Alignment repaired parts at
Warehouse Repairs Room
Warehouse

Eliminating (NVA) Eliminating (NVA)

Transport and Transport and
Wait time Wait time

o Overall “Turn around time” (TAT) i.e. time required to receive faulty part, repair and restock
the same can be reduced practically to maximum 2 days’ time.

o Therefore, part can be made available for shipment back to customer for future failures in
maximum 2 to 3 days’ time.