SCM HPML
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SUPPLY CHAIN MANAGEMENTINHINOPAK MOTORS LIMITED.
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Sir. SOHAIL MAJEED IQRA UNIVERSITY
Presented by:SHEEMA RAZA 2936ADIL AZIZ 2938KHAWAR ATEEQ 2934SANA MUSHTAQUE
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SCM MissionTo create a seamless end-to-end Supply Chain from suppliers to customers, which provides excellent Customer Service at optimal overall cost through:
Efficient Business Partners relationship Flexible manufacturing Reliable distribution Reduction in cost base
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Supply Chain GoalsEfficient supply chain management must result in tangible business improvements. It is characterized by a sharp focus on ;
Revenue growthBetter assets utilizationCost reduction
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SUPPLY CHAIN IN
HINOPAK MOTORS LIMITED
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I N D
I A
C H I N A
IRAN
KARACHI
Lahore
Quetta
Sadiqabad
FaisalabadMultan
IslamabadPeshawar
NWFP
Punjab
Sindh
Balochistan
Province
Federal Capital
Provincial Capital
Hino Head Office
Hino Area / Rep. Offices
A F G H
A N I S
T A N
Head Office, Karachi - PakistanARIBIAN SEA
Assembly Operations Plant
Area47,000m2
Employees454 Nos.
Body Operations Plant
Area24,000m2
Employees905 Nos.
Established in 1986 Share Holding Hino & TTC = 89% & Public = 11% Head Office in Karachi City
Introduction of Hinopak Motors
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FG1J (4x2)
FL1J (6x2)
FM1J (6x4)
SG1J (4x2)
FM2P (6X4)
GT1J (6x4)
500 SERIES
DUTRO (4x2)
JR. DUTRO (4x2)
HIGH POWERDUTRO (4x2)
IMV FRAME
300 SERIES BUS SERIES
AK1JR
AK1JR-CNG
AK1JM
RK1J
FB2W
AK1JR-LH
DUTRO-LH
PRODUCT RANGEAssembly Operation Plant (AOP)
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PRODUCT RANGEBody Operation Plant (BOP)
Truc
k &
Spe
cial
ized
Bod
ies
Bus
Bodi
es Urban Bus Urban Bus Splendor Bus CNG Bus Rapid liner Senator Road liner
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AchievementsISO 9001 Certification
Hinopak is the only automotive company in Pakistan and the first Hino affiliate worldwide to receive the ISO 9001 certificate. This certificate has been given to Hinopak for implementing and maintaining a company-wide quality.
ISO 14001 CertificationBeing a responsible corporate citizen striving for the improvement in our environment, both within and outside the company , Hinopak Motors Limited has voluntarily ISO 14001 Certification. ISO 14001 pertains to monitoring and managing the effect, which any business has on the environment.
OHSAS 18001:2007 CertificationHinopak has successfully achieved accreditation to safety management system OHSAS 18001:2007.OHSAS 18001 is a Health and Safety Management System, developed to assist in the reduction and prevention of accidents and accident related loss of lives, equipment and time.
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2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
5000
3000
10000 1,518 1,883
2,341 2,286 2,614
3,593 4,1123,017
876895
HINOPAK Sales Achievement (Last 10 Years)
59%
41%
Hinopak, Current Market Shares
Hino Others (Nissan, Master, Issuzu, Faw, Dong feng etc.)
World Recession
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77.47%
12.09%
8.80%0.04%
1.60% 0.00%
Hinopak Mkt. Share in Bus Business
HINOISUZUNISSANMASTERDONG FENGVOLVO
45.42%
22.21%
23.11%
8.86%0.40%
0.00%
Hinopak Mkt. Share in Truck Business
HINOISUZUNISSANMASTERDONG FENGVOLVO
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Organizational Chart
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Supply Chain Structure in HINOPAK
Final product
manufacturing
Supplier
ProcurementInventory
management
Customers
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PROCUREMENT&
INVENTORY MANAGEMENT
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Order Flow Process ( Customer to HPML)
Customers
(Direct/Indirect)
Assembly/
Manufacturing
Procurement
Vendors/Supplier
s
60% Local &
40% Import
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Material ManagementInventory ControlBill of MaterialOrdering SchedulingStock Checking & Control
ERP System Implementation
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Classification of Inventory CKD PartsThese are high value, low volume parts these parts are outsourced mainly from Japan.CKD parts come on weekly bases and are issued CKD store. The rolling of these high value parts takes place on regular intervalsVendorized / local partsThese parts are purchased form specific vendors which are not international but local vendors, all types of parts under the category of Venderized/local parts, like High value, low volume, low value, high volume.
Part CategoriesCKD PARTS Venderized PARTS
Engine Disk wheelAxle assembly Brake drums
Chassis Leaf springsCap Batteries
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Pareto Principle is used as a Powerful Tool for Keeping with the lowest cost of stock. The Manager MOD Frequently and Closely Control 20% of the Inventory Offer that makes 80% of total Inventory Value. 1700 items are available in different CBOM , 200 Kanban items.
Pareto Principle for Inventory Control
The concept is that a supplier should only deliver components to the production line as and when they are needed. Kanban limits the amount of inventory in the process by acting as an authorization to produce more inventory.Kanban is maintaining minimum inventory on the floor.
Kanban
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Import Procurements ProcessForecast
Procurement B.O.M
Price Negotiation
Performa Invoice (FOB /
C&F)
P.O placed L .C
Revival & Recovery of original
documents i- BL ii- Invoice iii- L.C
Clearance through Agent
or direct
Delivery and Possession of
Material
Good Receiving
Note
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Local Procurements
Mktg. ForecastSupply Chain deptt. & PPC
MPS Generation
Oracle generate Purchase generate
P.O received by Vendor
Vendor Supplies Part
to HPMLReceiving Cell Oracle Entry
MOD Verifies the quantity
fwd to QCInspection
GRN generated
transfer to stock
feeding on line as per MPS
thru MIR
on completion of job, job
closed
Invoice generated to
mktg.
MRN generated Finance (-tax &
payment to vendor)
OK
NOT OK
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Global Procurements
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MRP PLANNING
Example of ERP System
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WAREHOUSE MANAGEMENT
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Warehouse ManagementStores:
Stores Department at Hinopak performs following functions.Manages the receiving, stacking & Issuance of parts & materials to the shops.Ensures the provision & dispatches of required parts to the shop floors, spares parts division & vendors.Handles the rejections & damages from all shops
Division of Stores:Stores department at Hinopak has been divided into a number of small stores according to the type of material being stored and function/services provided by the store.
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The division is shown as follows:
STORES DEPARTMENT
CKD Stores RM Stores Consuma
ble StoresWiring
Harness Store
Stationery Stores
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MANUFACTURING
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Master Production Scheduling (MPS)•Master Production Scheduling (MPS)
The objectives of this module are to help Hinopak Motors they anticipate shortage before its accrue, (current stock, purchase order, manufacturing order & sales order) these activities creates a projection of your stock levels anywhere from a week to several years in advance through this you can easily highlights your shortages.
MPS You can easily see what exactly the shortage will appear if we execute the specific production plan.
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Assembly Operation Plant ( Flow Diagram)
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• Waste of material, time, energy, resources, equipments and potential etc.
Muda (waste)
Practice to Improve / Process Efficiency
To avoid 3Ms
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SEITON (Organizing)
Place things in such a way that they can be easily reached whenever they are
needed.
SEISO(Shine)
Keep things clean and polished; no trash or dirt in the workplace
SEIKETSU(Standardization)
Maintain cleanliness after cleaning – perpetual cleaning.
SHITSUKE (Self discipline)Commitment, a typical teaching and attitude towards any undertaking to
inspire pride and adherence to standards established for the four components.
SERI (Sort)
Remove what is not needed and keep what is needed
5S Activity
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Kaizen
The Japanese term for Continuous Improvement is kaizen and is the process of making incremental improvements, no matter how small, and achieving the lean goal of eliminating all waste that adds cost without adding to value. It pushes individuals skills for working effectively in small groups, solving problems, documenting and improving processes, collecting and analyzing data, and self-managing within a peer group. It pushes the decision making (or proposal making) down to the workers and requires open discussion and a group consensus before implementing any decisions. Kaizen is a total philosophy that strives for perfection and sustains Toyota Production System (TPS) on a daily basis.
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VENDOR MANAGEMENT
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VendorRegistration Form
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VendorEvaluationForm (Initial)
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There are three types of Sourcing Sole
Technical specificationsRaw material locationOnly single organization is producing that particular material.
MultipleQualityCostsPrice
Single SourcingSourcing is based on the joined consensus of opinion of the organization. This results in long term contracts among the suppliers with a guaranteed volume.
Sourcing
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QUALITY PERFORMANCE Yusuf industries
Hataf Engg
Tariaj Industries
Allied Engg TransmissionEngg
LINE RETURN 8 7 7 8 7PPM DEDUCTION 9 9 8 7 8
CERTIFIED YIELD MULTIPLIER 9 9 7 7 8PENALTY:FIELD ISSUES
STOP SHIPMENTLINE PURGE
9 8 7 7 8
SUB TOTAL 9 8 7 7 8PROCESSS CONTROL 9 8 7 7 8
PROCESS TECHNOLOGY 8 9 7 7 8SUSTAINING TECHNICAL
SUPPORT 8 7 7 7 7
ON TIME DELIVERY 7 7 7 7 7PRODUCT TECHNOLOGY 8 7 7 8 8
LEAD TIME 7 8 7 8 9PURCHASING AND
MATERIAL SUPPORT 8 8 7 8 9
PERFORMANCE MATRIX TOTAL 7 8 7 8 7
PRICE INDEX =TARGET PRICE /ACTUAL PRICE 8 7 8 8 8
SCORE=PERFORMANCE MATRIX*PRICE INDEX 8 8 9 8 9
TOTAL COST OF SUPPLY =((100-SCORE/100)/1 8 8 8 7 8
Points ranking:RATING FACTO POINTS
EXCELLENT 9
VERY GOOD 8
GOOD 7
AVERAGE 6
Quality Performance Scorecard for vendors (monthly basis)
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S# Vendor Name AREA FORMAT TOTAL NO
Feb-10
1 A & A Metal Industries
QUALITY QRR (Q) 10 10
QRR (S) 10 10
QPR 10 10
PIR 10 10
SUPPLY V-BEH 30 30
PRICE PCR 30 30
TOTAL 100 100
GRADE A+
2 A & Z Company
QUALITY QRR (Q) 10 10
QRR (S) 10 10
QPR 10 6
PIR 10 10
SUPPLY V-BEH 30 24
PRICE PCR 30 30
TOTAL 100 90
GRADE A
Periodic Appraisal of Vendors SCORE CARD
GRADING CRITERIA•A+ = 95 % and above•A = 85 % ~ 94 %•B = 75 % ~ 84 %•C = 65 % ~ 74 %
CriteriaOn time deliveryProduct technologyLead timePurchasing and material supportProcess controlProcess technologyQMS Certification
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Future recommendations
JUST IN TIME. Lean Purchasing Practices – small frequent deliveries, pulled to the line.Reduced Inventory Carrying Cost.Previously [6 + 6] Line Feeding …. Change to [1 + 1] Line Feeding.Direct Feeding From Vendor To Line.Reliability of Parts Good Quality Increase.Function of QC Change from In-coming Inspection To Vendor Development.Have a Second Source of Supply: Especially for critical parts, use two sources of supply
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THANK YOUFOR YOUR KIND ATTENTION