Report

WORKING OF PPMC

(PRODUCTION PLANNING & MATERIAL CONTROLLLING)

A PROJECT REPORT

Under the guidance of

MR. IMRAN SHERA

Submitted by

KAUSHAL BHARATKUMAR DAVE

ROLL NO.: 1205017002

In partial fulfillment of the requirement

For the award of the degree

Of

MBA

IN

[Operations Management]

MARCH 2014

Bona Fide Certificate:

BONAFIDE CERTIFICATE

Certified that this project report titled “Working of PPMC in companies across

Pharmaceutical Industries” is the bona fide work of “Kaushal Bharatkumar Dave” who

carried out the project work under my supervision.

SIGNATURE SIGNATURE

HEAD OF THE DEPARTMENT FACULTY IN CHARGE

Sr. No Chapter Name and Content Page No.

1 Preface

2 Acknowledgement

3 Executive Summery

4 List of tables

5 List of figures

6 List of abbreviations

7 Research Methodology

Chapter: I

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

PREFACE

It gives us great pleasure in placing in hand of our esteemed department, this report

that, we believe, will go through the documentation of this project work made by us.

Today business unit can exist when only work smarter than working harder. Man’s true

knowledge is the “Experience” and “Observation”. Hence it is a good thing that the

business school offers such training to the student in all the aspects of the

business. Looking at the today’s world or scenario, the students is focused into the world

of commerce and management, but less are in the world of practical

knowledge. Only the bookish knowledge is not sufficient. So, the SIKKIM MANIPAL UNIVERSITY has decided to include the program of

practical knowledge in the 4th Semester of MBA Program to hire some practical

knowledge about the Operation management like inventory levels, just in time

production, supply chain management, etc.

Acknowledgment

Through this acknowledgement, I express my sincere gratitude towards all those people

who aided me in the preparation of this project report which has been a learning

experience.

I would like to thank, Mr. Imran Shera, Manager- Production, Rajesh Gupta, Asst.

manager – Production, Jayesh Chaudhari, Executive Production & Purusharth Detroja,

Sr. officer Production for giving me the best opportunity of this practical work

experience.

Again I express m y thanks to the M r . N a v i n K . S i n g h , D G M – H R &

Mr. Manoj More, Asst. Manager-HR who had given me remarkable information

regarding Human Resource position of Famycare Pharmaceuticals Ltd.

Words are inadequate in offering my thanks to the Project Trainees, for their

encouragement and cooperation in carrying out the project work.

Finally, yet importantly, I would like to express my heartfelt thanks to my beloved

parents for their blessings, my friends for their help and wishes for the successful

completion of this project.

Executive Summary

Supply chain management focuses on the management of the transfer of materials and

information along the entire chain from the suppliers to the final consumer. This chain

will generally include the suppliers, producers, distributors, retailers and then the final

customer.

One of the major problem areas of supply chain management is Inventory management.

Inventory can be defined as the stock of any item or a resource that will help the firm in

generating revenue. The inventory can be the raw materials, the work in progress

inventory or the finished goods that have not been dispatched. They all have some costs

associated with them and these extra costs can affect the margins of the company.

The pharmaceutical industry was selected for the study because the industry is very fast

moving and requires dealing with huge amount of inventory, in all forms. The companies

selected for the study were the companies having the highest market capitalization in the

year 2013. The inventory data was collected for all the companies and a comparative

study was done.

The data required for analysis was taken from reliable databases like ACE Equity

Database.

The study was done on the basis of some parameters (ratios) that are used to measure the

inventory management of a company.

The study also revealed the trends that are prevailing in the pharmaceutical industry since

the last five years. The results also indicated that better inventory handling can provide

good results, as was visible from the data analysis.

The dissertation project helped me understand in detail the parameters of a supply chain

and inventory analysis in better detail.

List of Tables:

Table 1 - Major pharmaceutical industry in India

Table 2 - Top selling medicinal brands

Table 3 - countries where medicines are exported

Table 4 - Domestic planning vs. export planning

Table 5 - Products deliverance time based on dosage

Table 6 - Purchase requisition

Table 7 - Lead time chart

Table 8 - BMR & BPR requisition

Table 9 - Theory of constraints

List of figures

Figure 1 - Flow chart for supply chain management process of company

Figure 2 - Flow chart for monthly production planning activity

Figure 3 - Health sector supply chain

Figure 4 - Industry challenge & responses

List of Abbreviations

CAGR : Compounded Annual Growth Rate

USD : United State Dollar

R & D : Research & Development

MAT : Moving Annual Total

CVS : Cardiovascular System

CNS : Central Nervous System

NDDS : Novel Drug Delivery System

PPMC : Production Planning & Material Control

HPLC : High Performance Liquid Chromatography

BMR : Batch Manufacturing Record

BPR : Batch Packing Record

GMP : Good Manufacturing Record

PAR : Product Availability Report

QC : Quality Control

RM : Raw Material

PM : Packing Material

QA : Quality Assurance

BSR : Bonded Store Room

RA : Regulatory Affairs

MTS : Make To Stock

MTO : Make To Order

F & D : Formulation & Development

MRP : Material Requirement Planning

BOM : Bill of Material

MRP II : Material Resource Planning

JIT : Just In Time

TOC : Theory of Constraints

TQC : Total Quality Control

SOP : Standard Operating Procedure

MFR : Master Formula Record

MMR : Master Manufacturing Record

SCM : Supply Chain Management

MFC : Master Formula Code

GRN : Goods Receipt Note

PR : Purchase Requisition

PO : Purchase Order

COA : Certificate of Analysis

CPFR : Collaborative Planning Forecasting & Replenishment

ERP : Enterprise Resource Planning

GRF : Goods Return Form

FIFO : First In First Out

TQM : Total Quality Management

VMI : Vendor Managed Inventory

Research Methodology:

The method adopted by the researcher for completing the study is called research

methodology. Data becomes information only when a proper methodology is adopted.

Thus we can say Methodology is a tool which processes the data in to reliable

information. The components of the research methodology are research design, type of

data, data collection, sampling plan and statistical tools used.

Percentage Analysis Percentage refers “for every hundred”. It is used to make easy comparisons of fractions. In the

study, fractions of respondents choosing different answers are converted into

percentages and interpretations are made.

Formula: No of respondents% = No of respondent *100 / Total No of respondent

a) Primary Data:

1. The data was collected by the questionnaire method. A questionnaire was prepared which consisted of 19 questions to be filled by the employees.

2. Basic information collected from the local sources as well a

from the company staff like senior managers, employees and

officers. Moreover information gathered through discussion with the

concern HR Personnel of the organization.

b) Secondary data:

Secondary collected from the below given sources.

1. From the HR department.

2. From internet.

3. From books like catalogue.

4. From the employees‟ training files and training record

1. INTRODUCTION OF PHARMACEUTICAL INDUSTRY :

The indian pharmaceutical industry currenty tops the chart among india's science based

industries with wide ranging capabilities in the complex field of drug manufacture

and technology. A highly organized sector, the Indian pharmaceutical industry is

estimated to be worth $ 4.5 billion, growing at about 8 to 9 percent annually. It ranks

very high amongst all the third world countries,in terms of technology, quality and the

vast range of medicines that are manufactured. It ranges from simple headache pills to

sophisticated antibiotics and complex cardiac compounds; almost every type of

medicine is now made in the Indian pharmaceutical industry.

The Indian pharmaceutical sector is highly fragmented with more than 20,000

registered units. It has expanded drastically in the last two decades. The

Pharmaceutical and Chemical industry in India is an extremely fragmented market

with severe price comptition and government price control. The Pharmaceutical

industry in India meets around 70% of the country's demand for bulk drugs, drug

intermediates, pharmaceutical formulations, chemicals, tablets, capsules, orals and

injectable. There are approximatey 250 large units and about 8000 Small Scale

Units, which form the core of the pharmaceutical industry in India (including 5

Central Public Sector Units).

CURRENT SCENARIO :

India's pharmaceutical industry is now the third largest in the world in terms of

volume and stands 14th in terms of value. According to data published by the

Department of Pharmaceuticals, Ministry of Chemicals and Fertilizers, the total

turnover of India's pharmaceuticals industry between September 2008 and September

2009 was US$ 21.04 billion. Of this the domestic market was worth US$ 2.26 billion.

The Indian pharmaceuticals market is expected to reach US$ 55 billion in 2020

from US$ 12.6 billion in 2009. The market has the further potential to each US$ 70

billion by 2020 in an aggressive growth scenario. Moreover, the increasing population

of the higher-income group in the country will open a potential US$ 8 billion

market for multinational companies selling costly drugs by 2015. Besides, the

domestic pharma market is stimated to touch US$ 20 billion by 2015, making

India a lucrative destination for clinical trials for global giants. Further estimates the

healthcare market in India to reach US$ 31.59 billion by 2020.

Diagnostics Outsourcing/Clinical Trials:-

The Indian diagnostic services are projected to grow at a CAGR of more than

20 per cent during 2010-2012. Some of the major Indian pharmaceutical firms,

including Sun Pharma, Cadilla Healthcare and Piramal Life Sciences, had applied for

conducting clinical trials on at least 12 new drugs in 2010, indicating a growing interest

in new drug discovery research.

Generics:-

India tops the world in exporting generic medicines worth US$ 11 billion and

currently, the Indian pharmaceutical industry is one of the world's largest and most

developed. Moreover, the Indian generic drug market to grow at a CAGR of around

17 percent between 2010-11 and 2012-13. Union Minister of Commerce and Industry

and Minister for Trade and Industry, Singapore, have signed a 'Special Scheme

for Registration of Generic Medicinal Products from India' in May 2010, which

seeks to fast-track the registration process for Indian generic medicines in Singapore.

1.1 ADVANTAGE:

The Indian Pharmaceutical Industry, particularly, has been the front runner in a

wide range of specialties involving complex drugs' manufacture, development

and technology. With the advantage of being a highly organized sector, the

pharmaceutical companies in India are growing at the rate of $ 4.5 billion, registering

further growth of 8 to 9 % annually. More than 20,000 registered units are fragmented

across the country and reports say that 250 leading Indian pharmaceutical companies

control 70% of the market share with stark price competition and government price

regulations.

Competent workforce:-

India has a pool of personnel with high managerial and technical competence as

also skilled workforce. It has an educated work force and English is commonly

used. Professional services are easily available.

Cost-effective chemical synthesis:-

Its track record ofdevelopment, particularly in the area of improved cost-

beneficial chemical synthesis for various drug molecules is excellent. It provides a

wide variety of bulk drugs and exports sophisticated bulk drugs.

Legal & Financial Framework:-

India has a 53 year old democracy and hence has a solid legal framework and strong

financial markets. There is already an established international industry and

business community.

Information & Technology:-

It has a good network of world-class educational institutions and established

strengths in Information Technology

Globalization:-

The country is committed to a free market economy and globalization. Above all, it

has a 70 million middle class market, which is continuously growing.

Consolidation:-

For the first time in many years, the international pharmaceutical industry is

finding great opportunities in India. The process of consolidation, which has become a

generalized phenomenon in the world pharmaceutical industry, has started taking

place in India.

Tab. No. 1: MAJOR PHARMACEUTICAL COMPANIES IN INDIA

Rank Company Country Total Revenues

(USD millions)

1 Johnson & Johnson United States 63,747.0

2 Pfizer United States 48,296.0

3 GlaxoSmithKline United Kingdom 44,654.0

4 Roche Switzerland 44,267.5

5 Sanofi-Aventis France 42,179.0

6 Novartis Switzerland 41,459.0

7 AstraZeneca United Kingdom 31,601.0

8 Abbott Laboratories United States 29,527.6

9 Merck United States 23,850.3

10 Wyeth United States 22,833.9

Tab. No-2 TOP SELLING MEDICINAL BRANDS

No. Generic

Name

Brands Companies Indications Sales

( USD

Billions )

1 Atorvastatin Lipitor Pfizer, Astellas Cholesterol 12.66

2 Clopidrogel Plavix Bristol Myers Squibb, SanofiAventis

Atherosclerosis,

prevention of

clot related

events

8.82

3 Infliximab Remicade J&J, Merck,Mitsubishi Tanabe

RA, UC, CD, Ps,PsA, AS

6.04

4 Fluticasone

Salmetrol

Advair Glaxo Smith Kline

Asthma, COPD

8.47

5 Etanercept Enbrel Amgen, Pfizer, Takeda

RA, JIA, Ps,

PsA, AS

6.17

6 Bevacizumab Avastin Roche Cancer: lung,

colon, kidney,

glioblastoma

5.53

7 Aripiprazole Abilify Otsuka, BMS Schizophrenia, Depression,

Bipolar

5.43

8 Rituximab Rituxan Roche NHL, CLL, RA 5.03

9 Adalimumab Humira Abbott RA, Ps, JIA,

PsA, AS, CD

5.96

10 Valsartan Diovan Novartis Hypertension 4.16

11 Rosuvastatin Crestor Astra Zeneca, Shionoggi

Cholesterol 6.8

12 Enoxaparin Lovenox Sanofi Aventis Anticoagulant

DVT

4.28

13 Quetiapine Seroquel Astra Zenec Schizophrenia 5.6

14 Trastuzumab Herceptin Roche Breast Cancer 4.17

15 Esmoprazole Nexium Astra Zeneca Ulcer 8.36

16 Olanzapine Zyprexa Lilly Schizophrenia,

Depression,

Bipolar

5.74

17 Montelukast Singulair Merck Asthma, allergy 4.9

18 Insulin

Glargine

Lantus Sanofi Aventis Diabetes 4.69

19 Pioglitazone Actos Takeda Diabetes 4.32

20 Glatiramer Copaxone Teva, Sanofi Aventis

Multiple sclerosis

4.0

1.2 CHALLENGES AND FUTURE GROWTH:

Over the past decade, pharmaceutical companies have entered a difficult

period where shareholders, the market and regulators have created significant

pressures for change within the industry. The core issues for most of drug companies

are declining productivity of in-house R & D, patent expiration of number of block

buster drugs, increasing legal and regulatory concern, and pricing issue. As a

result larger pharmaceutical companies are shifting to new business model with

greater outsourcing of discovery services, clinical research and manufacturing.

Current global financial conditions and the threat of a broad recession accelerated

the timetable for implementing transformational changes in global organizations, as the

industry confronts lower corporate stock prices and an increasingly cost-averse

customer. Leaders of the largest global pharmaceutical companies recognize the need

for transformational change in their organizations, but will need to move swiftly to

ensure sustained growth. Transformations in the business model of larger

pharmaceutical industry spell more opportunities for Indian pharmaceutical companies.

Pharmaceutical production costs are almost 50 percent lower in India than in

western nations, while overall R&D costs are about one-eighth and clinical trial

expenses around one-tenth of western levels.

The Indian stock market may be dreading a possible recession but Indian

pharma companies seem unfazed by slowdown fears. Riding on better sales in the

domestic and export markets, Indian pharmaceutical industry is expected to

continue with its good performance. Today Indian pharmaceutical Industry can

look forward to the years to come, with great expectations. There are opportunities in

expanding the range of generic products as more molecule come off patent,

outsourcing, and above all, in focusing into drug discovery as more profits come from

traditional plays. At the same time, the Indian Pharma Industry would have to contend

with several challenges particularly

The Effects of new product patent

Drug price control

Regulatory reforms

Infrastructure development

Quality management and

Conformance to global standards.

GROWTH:

The Indian pharmaceutical market reached US$ 10.04 billion in size, with a

value-wise growth rate of 20.4 per cent over the previous year's corresponding period

on a Moving Annual Total (MAT) basis for the 12 months ended July 2010.

Cipla maintained its leadership position in the domestic market with 5.27 per cent

share, followed by Ranbaxy. The highest growth in the domestic market was for

Mankind Pharma, which grew 37.2 per cent. Leading companies in the domestic

market such as Sun Pharma (25.7 per cent), Abbott (25 per cent), Zydus Cadila (24.1 per

cent), Alkem Laboratories (23.3 per cent), Pfizer (23.6 per cent), GSK India (19 per

cent), Piramal Healthcare (18.6 per cent) and Lupin (18.8 per cent) had impressive

growth during July 2010, shows the data.

The pharmaceuticals industry in India will grow by over 100 per cent over

the next two years. The pharmaceutical industry is currently growing at the rate of

12 per cent, but this will accelerate soon. The sale of all types of medicines in

the country stands at US$ 9.61 billion, which is expected to reach around US$ 19.22

billion by 2012. India's domestic pharmaceutical market is valued approximately at

US$ 12 billion in 2010, and has shown a strong growth of 21.3 per cent for the

12 months ending September 2010. It estimates that over the next 10 years, the

domestic market will grow to US$ 49 billion, at a compounded annual growth rate

(CAGR) of 15 per cent.

COMPANY OVERVIEW

Name Type of Business

: -

: -

Famycare Ltd. Hormone –Pharmaceutical

Site Address

: -

Pharmaceutical Special Economic Zone,

Sarkhej-Bavla

NH.No-8A, Near Matoda Village,

Tal-Sanand

Dist-Ahmedabad-382213, Gujarat, India

Phone No :- 07930414500 / 592/593

Email I.D

:- [email protected]

(A) About the Company:-

Famy Care was incorporated in India in 1990 with the vision of becoming a Competitive force to reckon with in Female Health Care with a focus On Hormonal &

Reproductive Health Care Products.

Reproductive Health Care Segment :

The company engaged in the anufacturing of a wide range of Reproductive

Healthcare Products, like Oral Contraceptives, Emergency Contraceptives, Intra Uterine

Devices and Tubal Ligation Rings for the quality conscious customers through quality

research and development.

It is the one of the largest suppliers of Intra Uterine Contraceptive Devices (IUD)

And Oral Contraceptive Pills (OCPs) to various Ministries of Health & Family Welfare

and Social organizations across the World.

Its products and services are distributed and maximized through all appropriate channels

in each geographic market.

Famy care is a global player in the Female Health Care Segment with a focus on

Hormonal & Reproductive Health Care Products. Famy care believes in the right of

women to be informed about their reproductive healthcare choices and to make good

health accessible to all. In a very short span of time we have become the largest

manufacturer of Hormonal Tablets. We have four world class plants at two locations

supported by strong R&D facility for development of Complex Hormonal &

Reproductive Health Care formulations.

(B) BUSINESS :

Its products of Hormonal formulations and Medical devices are available in more

than 40 countries worldwide. It is an approved supplier of UNFPA, PSI, and Crown

Agents-UK & PAHO. Its Products are supplied to projects run by DKT, World Bank,

IPPF and Ministry of Health in various parts of the world.

Foreseeing the rising demand of Hormonal and Reproductive Health Care

Products in Global Market, the facilities have been upgraded to meet the US and EU

regulatory requirements. Eventually, this will enable us to become a dominant Global

Player in the Hormonal and Reproductive Health Care Segment.

The company regularly participates in various trade fairs, seminars and

conference across the globe to meet likeminded people for carrying out business

alliances.

Milestones in OCP Business

Largest producer and exporter of Oral Contraceptive Pills.

Exporting over 150 Million cycles of Pills annually to various countries around

the world.

Famy Care has a wide range of product to meet all specific needs of the Pill

user.

The manufacturing plant not only has a WHO-GMP certification but also is the

only plant in India that has gone through a number of international GMP

compliance audits.

First company to start OCP‟s export from India

Milestones in IUD Business

One of the world's largest producers of Copper-T having the largest capacity to

produce IUD's.

First indigenous supplier of Copper- T to the Ministry of Health & Family

Welfare, Government of India, since 1991 with an Excellent track record of

accomplishment for 16 years.

Regular supplier of IUD's to various National Family Welfare Programs

around the world like UNFPA, World Bank, and large NGOs like DKT.

First company to start exports of lUD's from India to UNFP

(C) PRODUCT :

Its Product Range includes Oral Contraceptive pills, Emergency Contraceptive Pills,

Progestagen Only Pill, Intra Uterine Devices, Rings for Tubal Ligation and Cancer

Detection Kit.

Oral Contraceptive

Ranges from a combined combination of estrogen and progesterone, which

ranges from a vast range of Monophasic pills to Triphasic pills.

Monophasic

Monophasic pills contain constant combination ratio of estrogen and

progesterone in all of the active pills in a pack. Famycare brands of Monophasic

pills includes the molecules like Ethinylestradiol, Levonorgestrel, Norgestrel,

Desogestrel, Gestodene, Cypterone acetate etc.

Biphasic

Biphasic pills contain two different ratios of progesterone and estrogen. The

hormonal variations in the active pills changes twice during the cycle.

Triphasic

Triphasic pills contain three different doses of hormones in the active pills, the

hormonal variations in the active pills mimic the female natural menstrual

cycle.

List of Products

Table 1 List of product name

Sr

No

Product Name

Brand/RLD Name

1

Ethinyl Estradiol Triturate 0.33% w/w Seasonique /

Lo - Seasonique

2

Medroxyprogestrone Acetate USP

Not Applicable

3

Levonorgestrel and Ethinyl Estradiol Tablets USP (0.1mg/0.02mg) with Inert Tablets

Lutera

4 Levonorgestrel and Ethinyl Estradiol Tablets USP

(0.15mg/0.03mg) with Inert Tablets

Nordette

5 Norethidrone and Ethinyl Estradiol Tablets USP

(0.5mg, 0.75mg & 1mg / 0.035mg) with Inert Tablets

Orthonovum

6 Levonorgestrel and Ethinyl Estradiol Tablets USP

(0.15mg/0.03mg) with Inert Tablets

Seasonal

7

Levonorgestrel Tablets (0.75mg)

Plan B

8

Levonorgestrel and Ethinyl Estradiol Tablets

(0.05/0.03mg, 0.075/0.04mg, 0.125mg/0.03mg) with

Inert Tablets

Trivora

9 Levonorgestrel and Ethinyl Estradiol Tablets

(0.05/0.03mg, 0.075/0.04mg, 0.125mg/0.03mg)

Trigynone

10 Levonorgestrel and Ethinyl Estradiol Tablets USP

(0.1mg/0.02mg) with Inert Tablets

Alasee

11

Norethindrone Tablets USP (0.35mg) Nor–QD

12

Norethindrone Tablets USP (0.35mg)

Orthomicronor

13 Norethindrone and Ethinyl Estradiol Tablets USP (0.4

mg / 0.035mg) with Inert tablet

Ovcon – 35

14 Norgestimate and Ethinyl Estradiol Tablets USP

(0.250mg / 0.035mg) with Inert Tablets

Ortho-cyclen

15 Norethindrone aceatate and Ethinyl Estradiol Tablets

USP with Ferrous Fumarate Tablets

Loestrin FE 1.5 / 30

(D) CAREERS :

For, Famy Care, Human Resource is the prime asset. The company

comprises of highly qualified & dedicated professionals who understand the

needs of the customers.

The core competency & ONE STOP SOLUTION achieved in the area of

Reproductive Health Care is due to consistent value addition through the people.

The core strength of "HUMAN ASSET" has enabled us to effectively bridge the

gap between product range requirement of donors, the markets and the varied

availability of quality raw materials.

The company believes that the Employees have a great contribution to make to

this evolving industry. To take Famy Care on a faster growth curve, the constantly

and closely work together with the Employees to forge a business partnership,

which is mutually beneficial and rewarding.

The Company is growing at a breathtaking speed where our people would be the

drivers to this growth and thereby getting an opportunity to grow at the same

speed.

High performance is very well recognized and rewarded.

Highly congenial and professional working atmosphere.

(E) OTHER LOCATIONS :

Corporate Office

3rd Floor, Brady House,

12/14, Veer Nariman Road, Fort,

Mumbai - 400 001.

India.

Tel: 91-22-3028 9655

Fax: 91-22-3028 9656

E-mail: [email protected]

Manufacturing Unit:

Plot No. 1608 & 1609,

G.I.D.C. Sarigam - 396 155

Gujarat, India.

Tel: 91-260-2780674, 2780502

Fax: 91-260-2780574

Manufacturing Unit:

Plot No. 688/10/11,

Siddhi Vinayak Industrial Estate,

Opp. Somnath Temple, Somnath,

Daman - 396 210. India.

Tel: 91-260- 224 2484, 224 3279

Fax: 91 -260-224 3279

Manufacturing Unit:

Famy Care Ltd

Verna ,Salcette

Goa – 403722

India

(F) VISION :

Famy Care strives to be a global player in the field of family welfare &

quality reproductive healthcare

The vision needs to be customer focused - describing a better world for people

and how the company can help them achieve that. It should not be about profit and

dividends.

To be the preferred and most trusted resource for the products and services

those enhances home and family life.

(G) MISSION :

The company committed to excellence in Reproductive Healthcare products and

Family Welfare Services for effective management in population control, world over.

It is the endeavor to seek unrivalled quality standards by incorporating the best

technology, human resources and quality management, thereby providing quality

products at affordable price.

(H) VALUES :

• The company is committed to create (or bring about) customer‟s delight.

• It ensures an environment of high self esteem, mutual respect and

• Teamwork.

• It is committed to setting high standards of performance.

• It believes in fulfilling its commitment and work with highest level of

integrity and honesty

(I) Promoters:-

The company being a deemed public limited company, has Board of Directors

Consisting of:

Chairman

Shri Jyotiprasad Taparia

(B.Sc with Honours in Chemistry)

Managing Director

Shri Sanjeev Taparia ,

(ACA)

Executive Director

Shri Ashutosh Taparia

(MBA, University of Texas, USA).

(J) Senior Leadership:-

(K) Milestone & Achievements:

Table 3 Milestone & Achievements

1990 First company in India to set up manufacturing of IUD for GOI

1993 Largest Supplier of IUD‟s to GOI

1994 First company to start exports of IUD‟s from India

1997 Entered Oral Contraceptive Pills (OCP) Market.

1998 Acquisition of hormonal formulation facility at Sarigam

2001

First company to start exports of hormonal contraceptives from India First export order from Bangladesh worth 15 crores.

2002

Opened up additional 18 countries for export and accredited UNFPA global Supplier

2005

Aggressive marketing strategy to become an international company Initiating the entry into regulated market through South Africa.

2006

Well equipped R & D Centre

Initiating entry into newer regions like Russia-CIS, Brazil

Initiating entry into Europe and US markets;

2008

Acquisition of Aurangabad Plant ( Condom Plant) Ultra modern manufacturing plant at Ahmedabad (hormonal inject able and

hormonal tablet)

Accessing biggest Pharma market - USA Getting

EU GMP for our manufacturing facility

Submission of first CTD dossier in 9 EU countries

2009

9 ANDA applications filed. More in the pipeline Breakthrough in Latin American Countries

Successful product registrations in South Africa

(L) DESIGNATION AND HIERARCHY :

TABLE – 4

(M) Department Name with no of Personnel:-

Table 5 Department Name with no of Personnel

Sr

Department

No of Staffs

Operator

Contract Person

1 Human Resources 06 NA 02

2 Warehouse 07 02 10

3 Tablet Manufacturing 20 10 15

4 Injection Manufacturing 7 5 10

5 Packing 10 7 40

6 Quality control 38 2 6

7 Quality Assurance 33 NA 8

8 Engineering 15 06 10

(N) List of Equipments:-

Table 6 List of Equipments

Sr. No Equipment Name

1 Dynamic Pass Box

2 Rapid Mixture Granulator

3 Starch Paste Kettle

4 FBP

5 Vibro Sifter

6 Multimill

7 Double cone Blender

8 Tablet Compression Machine

9 De-Duster Unit

10 Digital Metal Detactor

11 Auto coater

12 Stirrer

13 Static pass box

14 Rapid Mixture Granulator

(O) Introduction of the Department:-

Warehouse :-

To take receipt of all incoming Raw and Packing materials at plant.

To issuance of raw and packing materials as per production planning.

Handling of Rejected / Expired Raw and Packing Materials.

Maintain stock of Raw and Packing materials.

Handling of Retest Material.

To fill all cGMP required documentation.

To dispatch finished product as per customer requirement.

Production :-

Tablet Manufacturing Area

Dispensing :-

Granulation :-

Compression :-

Blending :-

Coating :-

Quality Assurance :-

(A) IPQA: - In process Quality Assurance

IPQA check product quality during manufacturing with

various type instruments.

In granulation use moisture analyzer for LOD checking.

During compression use ,

• Hardness tester – for hardness and thickness

checking.

• Disintegration tester: - For D.T. checking.

• Friability tester :- for Friability test

• Analytical balance: - for weight variance of

tablet.

During coating ,

• Hardness tester: - Thickness checking.

• Disintegration tester: - For D.T. checking.

• Analytical balance: - for weight variance of

tablet.

During Packing ,

• Leak test apparatus: - for ensure no any blister

leak after sealing.

IPQA give line clearance before every activity starts and then after start

manufacturing activities.

(B) QA-Document:- Documentation QA does the work for document work.

They prepare various types of Protocol and document

for supporting to manufacturing.

Engineering :-

To design, operate and maintain the predefine standard of specification of

any machine is called engineering.

Engineering is a wide field of technical education including soft and

hard work.

Engineering a wide discipline of machine and technology lead to make it

device into specific branches but only for better understanding of any

particular subject or matter like civil work, electrical work, mechanical

work and computer work etc.

So, we go for actual practical work, it is to be noted that any mistake in

operation, design or in maintenance of any machine.

So, in addition of theoretical concepts practical training is to be given to

concerned personnel.

In other word, we can say that by investing wealth in training we get

better opportunity by means of avoiding any operational mistakes.

QC (Quality Control):-

Main objective is to maintain Quality in specific criteria.

In Pharma, Quality assurance is assuring Quality but Quality control is the

quality by checking each and every critical step of process and product.

QC has mainly five parts:

1. GLP

2. RM

3. FP

4. MICRO

5. STABILITY

TABLE :- 8 INTRODUCTION OF QC PART

3. INTRODUCTION OF PRODUCTION PLANNING AND

MATERIAL CONTROLLING

3.1 Definition

Production planning and material controlling can be defined as the

process of planning the production in advance, setting the exact route of each

item, fixing the starting and finishing dates for each item, to give production

orders to shops and to follow up the progress of products according to orders.

In any manufacturing enterprise production is the driving force to

which most other functions react. This is particularly true with inventories; they

exist because of the needs of production. In this chapter the relationship o f

production & material planning controlling to work-in-process inventories is

stressed.

3.2 General Objectives of Production Planning Material Controlling:

The ultimate objective of production planning and Material controlling,

like, is to contribute to the profits of the enterprise. As with inventory

management and control, this is accomplished by keeping the customers

satisfied through the meeting of delivery schedules. Specific objectives of

production planning and control are to establish routes and schedules for work

that will ensure the optimum utilization of materials, workers,and machines

and to provide the means for ensuring the operation of the plant in

accordance with these plans.

The principle of production planning and Material controlling lies in the

statement ‘First Plan Your Work and then Work on Your Plan’. Main functions

of production planning and control includes planning, routing, scheduling,

dispatching and follow-up.

3.3 Working of PPMC

Planning is deciding in advance what to do, how to do it,

when to do it and who is to do it. Planning bridges the gap from

where we are, to where we want to go. It makes it possible for

things to occur which would not otherwise happen.

Routing may be defined as the selection of path which each

part of the product will follow which being transformed from raw

material to finished products. Routing determines the most

advantageous path to be followed from department to department

and machine to machine till raw material gets its final shape.

Scheduling determines the programmed for the operations.

Scheduling may be defined as ‘the fixation of time and date for each

operation’ as well as it determines the sequence of operations to be

followed.

Dispatching is concerned with the starting the processes. It gives

necessary authority so as to start a particular work, which has

already been planned under ‘Routing’ and ‘Scheduling’. Therefore,

dispatching is ‘release of orders and instruction for the starting of

production for any item in acceptance with the route sheet and

schedule charts’.

The function of follow-up is to report daily the progress of work in each

shop in a prescribed Preformed and to investigate the causes of deviations from

the planned performance.

3.4 Benefits of Production Planning and Material Controlling:

(1) Optimum Utilization of Capacity:

With the help of Production Planning and Material Control [PPMC] the

entrepreneur can schedule his tasks and production runs and thereby

ensure that his productive capacity does not remain idle and there is

no undue queuing up of tasks via proper allocation of tasks to the

production facilities. No order goes unattended and no machine

remains idle.

(2) Inventory control:

Proper PPMC will help the entrepreneur to resort to just- in- time systems and

thereby reduce the overall inventory. It will enable him to ensure that the

right available at the right time.

(3) Economy in production time:

PPMC will help the entrepreneur to reduce the cycle time and increase the

turnover via proper scheduling.

(4) Ensure quality:

A good PPMC will provide for adherence to the quality standards so that

quality of output is ensured. To sum up we may say that PPMC is of

immense value to the entrepreneur in capacity utilization and inventory control.

More importantly it improves his response time and quality. As such effective

PPMC contributes to time, quality and

cost parameters of entrepreneurial success.

Production schedule:

The main aim is to schedule that amount of work which can easily be

handled by plant and equipment without interference. It’s not

independent decision as it takes into account following factors.

(1) Physical plant facilities of the type required to process the material

being scheduled. (2) Personnel who possess the desired skills and

experience to operate the equipment and perform the type of work

involved. (3) Necessary materials and purchased parts.

Master Schedule:

Scheduling usually starts with preparation of master schedule which

is weekly or monthly break-down of the production requirement for each

product for a definite time period, by having this as a running record of

total production requirements the entrepreneur is in better position to shift the

production from one product to another as per the changed production

requirements. This forms a base for all subsequent scheduling acclivities.

A master schedule is followed by operator schedule which fixes total time

required to do a piece of work with a given machine or which shows the time

required to do each detailed operation of a given job with a given machine or

process.

Manufacturing schedule:

It is prepared on the basis of type of manufacturing process involved. It is very

useful where single or few products are manufactured repeatedly at regular

intervals. Thus it would show the required quality of each product and sequence

in which the same to be operated Scheduling of Job order manufacturing:

Scheduling acquires greater importance in job order manufacturing. This will

enable the speedy execution of job at each center point

3.5 Limitation of PPMC function :

• Production planning and control function is based on certain assumptions or

forecasts of customer’s demand, plant capacity, availability of materials,

power etc. If this assumption go wrong, PPMC becomes ineffective.

• Employee may resist changes is production levels set as per production plans

if such plans are rigid.

• The production planning process is time consuming when it is necessary to

carry out routing and scheduling functions for and complex products consisting

of a large no of parts going into the product.

• Production planning and control function becomes extremely difficult when

the environmental factors change very rapidly such as technology,

Customer’s taste regarding fashion or style of products needed, government

policy and controls change frequently, stoppage of power supply by electricity

boards due power cuts, break in supply chain due to natural calamities such as

floods, earthquakes, war etc.

3.6 OBJETIVE OF THE STUDY

To increase the efficiency and performance of supply chain by co-

ordinating all departments works smoothly.

To monitor Throughput monitoring sheet and know the reason behind

delay in each and every department.

To understand the process of production planning process based on

domestic and export sales order.

To identify the issues related to production planning and material

controlling.

To suggest some management concepts which will be helpful to

resolve the PPMC issues.

To supply products in to domestic and international market on time

and to avoid delay for supplying products.

3.7 Limitations of the study:

Period of 3 Months are too short to study the Production

Planning and Material Controlling in detail. Also, it is very

difficult to study sufficient samples from the existing population

in such a short period of time. Hence, further research and

study is required for the above mentioned topics.

Some problems discussed in this project cannot be

generalized because it may have existed only at that particular

moment of time rather than being a regular phenomenon.

Respecting the policies that govern the confidentiality of certain

critical data within the organization, it was not possible to explore the

problem using such information and incorporate the same in this report.

This report attempts to provide suggestions for improving

PPMC function. These suggestions may or may not serve as the

final solution for existing problems in the organization.

Implementation of suggestions mentioned depends to a large

extent on the willingness of management.

This supply chain process is very complex in pharma field and

for understanding this process need experience in this field.

6. SUPPLY CHAIN MANAGEMENT PROCESS OF COMPANY

Vender (raw material & packaging material)

Purchasing department

Ware house company changodar

Thol plant & dehradun plant (store department) (excise duty dep, accounting

depart,

store management department) (good receive note)

QC testing ( raw material – floride,sulphate

limit,chloride,purity,HPLC,crometography

test,concentrationtest,)(packagingmaterial–

cartons,foils,insert,vials,strip,bottles,ampules,

test – sterility test, visual inspection,)

Production planning and material controlling department [production planning

1).daily,

2) weekly,3) monthly,4) yearly]

Raw material planning & packaging material planning

Production department

1. Parental 2. Tablet 3. Liquid

Finish quarantine goods (testing of parenteral & tablet by respective

department (runtime testing)

Finish product testing by QC (they release certificate of analysis for respective

country)

Packaging

1. Packaging 2. Packaging and development & international regulatory affair

PACKAGING finish product packaging with batch manufacturing record

(BMR) &

batch packaging record (BPR)

2. Packaging and development & international regulatory affair - artwork code

(new & revised) generated by Packaging & development department

QA department

Review batch BPR &BMR, GMP documentation

Finish product storage goods department

Distribution department

For trade dispatch (domestic & export) Tender (Gov.) dispatch (domestic & export)

C & F (4 C&F in India hydrabad,delhi,culcata,gujrat)

Packaging

1. Packaging 2. Packaging and development & international regulatory affair

PACKAGING finish product packaging with batch manufacturing record

(BMR) &

batch packaging record (BPR)

2. Packaging and development & international regulatory affair - artwork code

(new & revised) generated by Packaging & development department

QA department

Review batch BPR &BMR, GMP documentation

Finish product storage goods department

Distribution department

For trade dispatch (domestic & export)

Tender (Gov.) dispatch (domestic & export)

C & F (4 C&F in India hydrabad,delhi,culcata,gujrat)

Distributors Retailers

(4) PROCEDURE FOLLOWED BY PPMC DEPARTMENT

4.1 PRODUCT AVAIBILITY REPORT FOR DOMESTIC PRODUCT

PAR is containing list of products which have pending orders.

Distribution department is giving PAR for TRADE and TENDER sale

list to the PPMC department and they also give Novagen PAR which

is separate division and Par for the third party division is given from

the supply chain management department and narcotic PAR is given

from excise department another four divisions are in Troikaa

A. Hospitroy division

PPMC department shall prepare separate sheet of the product list for

Thol, Dehradhun and third party and shall forward to Thol and

Dehradhun for filling purpose.

Procedure for filling of Par by plant in charge:

B. Plant in charge with coordinate with QC in charge and shall fill

up the expected quantity, batch number and expected date of

receipt. Only for those products which are work in process or

which plan in next week basis of following criteria.

1) For parenteral product 16 days should be provided and that is for finish

product.

1 day for washing of sterile and non-sterile product, 2day for

manufacturing of product in sterile tank, 3 day for filling in

ampoules and vials. And then next 13

days for sterility purpose including Q.C and packing purpose.

2) For the tablet/capsule products 11 days shall be provided from the

date of granulation to final product viability

1st day for Dispensing

2nd day for granulation

3rd and 4th day for compression

5th day for coating

And then tablet goes for finish goods Quara ntine.

After that another 6 days for testing of Q.C release including packing.

So total 11 days are taking for finish product availability

3) For Liquid-cap products 21 days shall be provided from the date of filling to

final date of finish product availability.

4) For Bifosa 35/70, 15 days shall be provided from the date of granulation to

final date of granulation to final date of finish product availability.

5) For Torero sachet 15 days shall be provided from the date of granulation to

final date of granulation to final date of finish product availability.

6) For Myonit SR 2.6/6.4,15 days shall be provided from the date of granulation

to final date of granulation to final date of finish product availability.

PPMC officer shall also observe the expected date of receipt of two consecutive

PARS given by the production department if any date is changed then PPMC

department ask reason for the same.

PPMC officer shall daily fill up PAR deviation report with reference to

manufacturing date of particular batch.

4.2 PROCEDURE FOR FILLING OF EXPORT ORDER STATUS REPORT AT PRELIMINARY STAGE BY PPMC DEPARTMENT: At the time of receipt of new order PPMC department shall fill up

indent for raw materials required in particular order and shall forward it to

purchase department. If proposed execution date (planned date) is longer

than shipment date then ppmc department shall inform to purchase department

for urgent procurement for the same.

If purchase department don’t conveys than it’s impossible to prepone

delivery dates due to shortage material in the market, than ppmc department shall

derive the ADC date and inform to export department to extend the last shipment

date.

Ppmc department shall mention the purposed ADC date and execution

date based on availability of RM/PM and production schedule.

Procedure of filling Non availability of product list before 23rd by ppmc

department

department shall mention product (domestic) if product is available in

the month after 23 rd in Non availability of product list before 23 rd of

month and forward the report to distribution department by every Monday

with PAR report.

Distribution department have to take following action

1) Inter branch transfer of Ppmc existing stock

2) Transfer the Guj stock to C&F

Procedure for filling order execution date based on product ion plan by

production department.

On receipt of export order status, production department shall mention

the ADC dates on the basis of actual weekly production plan and production

norms after filling the ADC dates the report shall be forwarded to Q.C head

Q.C head shall fill up the ADC date based on the actual release of the

batch, and shall forward the report to ppmc department

Ppmc department shall mention the ADC submission date in the export

order status.

FINAL EXECUTION DATE:

The final execution date shall be given by ppmc department. Execution date

shall be two days from the date of ADC submission date.

4.3 GUIDELINE TO FINALIZE EXPORT ORDER QUANTITY

OBJECTIVE

To lay down a procedure for finalizing the export order quantity to match with

standard batch size before confirming the export order to the agent/associate.

SCOPE

This guideline is applicable to all export orders of THOL /

DEHARADUN, except below categories of export order

Government /Tender supply

All ointments

Product promoted ethically in export market

Production planning and material control dept. must try to combine these

orders with domestic order if possible.

RESPONSIBILITY

Order finalization: Head – International Marketing

Production planning according to standard batch size-Head-

PPMC

ACCOUNTABILITY

Head –PPMC

Prior to finalization of order of Purchase indent, International Marketing shall

finalize the order Quantity, as per following.

PEXO sending from international marketing department

International marketing department shall send PEXO to PMC / QC / QA /

PLANT HEAD/BSR with remarks on PEXO as follows:

Government tender order. (Part shipment/part quantity not allowed)

Government tender order ( part shipment is allowed but total

quantity to be fulfilled)

Trade order (2% Minus quantities is allowed for closing of

the PO Quantities)/Part shipment allowed

PPMC dept. shall forward the same PEXO to production dept. for

information purpose.

Procedure of excess quantity to be packed

OPTION I

(product exclusively manufactured for export and domestic)

If the excess quantity found in export trade order, production head shall

intimate to ppmc officer /executive in well advance (before packing of the

product).ppmc shall take approval from international business to pack the

excess qty. in same order. Some time it is used for domestic supply.

OPTION II (Products are manufactured execlusively for export)

If order quantity manufactured is excess against the PEXO and cannot be

packed in present PEXO or in domestic supply, such quantity shall be

reflected as excess quantity in “excess unpacked quantity after export order

completed Report, which is prepared by production head and submit to

ppmc department every week.

PPMC officer shall forward this report to IB team with his

proposed remarks to accommodate the excess quantity in

pending PEXO.

IB team shall confirm their remarks and forwarded the same

report to ppmc department.

Ppmc officer shall take action in pending PEXO and forwarded

the same report to production department.

If excess quantity found very minor quantity like 600 ampls

and vials and 3500 tabs and if it cannot be packed than

withdrawing the sample for RA if required and rest of the

quantity should be destroyed.

For products listed in Annex I : (slow moving & exclusively export

product list)

International Marketing dept. shall review the qty mentioned

Order quantity shall be considered as combined quantity of

sale as well as free scheme samples, which should match the

same qty.

If order quantity matching as per Annex-I qty, international

marketing department shall raise PEXO with highlight the order value

of each product with US $ for the further decision.

GMP aspects of the product

Order value of the order

Impact of not supplying the product in to the international market.

For the products listed in annex II (fast moving products):

If order quantity matching with specified qty in annex II,

international marketing department shall raise the purchase

indent and release the PEXO.

PPMC shall review planning of such product for domestic

purpose & shall club export quantities with domestic

quantity to have standardize batch size as per annex II.

PPMC department shall inform the export department for

the execution of such order which shall be approx .55 days

from the date of the receipt of the order.

4.4 Domestic planning Vs Export Planning

Domestic Planning Export Planning

Domestic production planning is

done based on Demand

forecast data given by

marketing department.

Make To Stock: MTS is a

usually technique, where in

anticipation of demand vast

quantities of goods are Produced

and stocked in warehouses.

Push Based Supply Chain : In

this type of supply chain,

Products are manufactured in

advanced of customer’s order,

stored into warehouse and then

pushes distribution chain to sell the

products.

Inventory

Less inventory keeping stock

compared export product

stock.

Domestic PPMC Planning

It is not a critical process compared to

International planning.

Export production planning is

done based on Export Sales

Orders.

Make To Order :

MTO is a production approach

where once a confirmed order for

products is received, and then

products are built.

Pull Based Supply

Chain : In this type of

supply chain,

Customer’s orders act as pull

factor and according to that

products are manufactured.

Inventory

High inventory stock compared

to domestic product.

International PPMC Planning

It is very critical and time taking process

Compared to domestic planning.

8 FINDINGS

Major Finding 1

F1 WORKING OF PPMC (PRODUCTION PLANNING AND

MATERIAL CONTROLLING)

F1.1 Step: 1 Demand forecasting of domestic and export product

Demand forecasting is used for estimating future demand of

product for domestic market and international market. Most of

companies are used time series method for estimating future

demand .However some large companies both domestic and

multinational employees Business economists or outsource

it from business consulting or market research firms.

Here some of the methods are given which are generally used by the

company:

OPTION II (Products are manufactured execlusively for export) If order quantity manufactured is excess against the PEXO and

cannot be packed in present PEXO or in domestic supply, such

quantity shall be reflected as excess quantity in “excess unpacked

quantity after export order completed Report, which is prepared

by production head and submit to ppmc department every week.

PPMC officer shall forward this report to IB team with his

proposed remarks to accommodate the excess quantity in

pending PEXO.

IB team shall confirm their remarks and forwarded the same

report to ppmc department.

Ppmc officer shall take action in pending PEXO and forwarded

the same report to production department.

If excess quantity found very minor quantity like 600 ampls

and vials and 3500 tabs and if it cannot be packed than

withdrawing the sample for RA if required and rest of the

quantity should be destroyed.

For products listed in Annex I : (slow moving & exclusively export

product list)

International Marketing dept. shall review the qty mentioned

Order quantity shall be considered as combined quantity of

sale as well as free scheme samples, which should match the

same qty.

If order quantity matching as per Annex-I qty, international

marketing department shall raise PEXO with highlight the order value of

each product with US $ for the further decision.

GMP aspects of the product

Order value of the order

Impact of not supplying the product in to the international market.

For the products listed in annex II (fast moving products):

If order quantity matching with specified qty in annex II,

international marketing department shall raise the purchase

indent and release the PEXO.

PPMC shall review planning of such product for domestic

purpose & shall club export quantities with domestic quantity

to have standardize batch size as per annex II.

PPMC department shall inform the export department for the

execution of such order which shall be approx .55 days from the

date of the receipt of the order.

4.4 Domestic planning Vs Export Planning

Domestic Planning Export Planning

Domestic production planning is

done based on Demand

forecast data given by

marketing department.

Make To Stock: MTS is a

usuallytechnique, where in

anticipation of demand vast

quantities of goods are Produced

and stocked in warehouses.

Push Based Supply Chain :

In this type of supply chain,

Products are manufactured in

advanced of customer’s order,

stored into warehouse and then

pushes distribution chain to sell the

products.

Inventory

Less inventory keeping stock

compared export product

stock.

Export production planning is

done based on Export Sales

Orders.

Make To Order :

MTO is a production approach

where once a confirmed order for

products is received, and then

products are built.

Pull Based Supply Chain : In

this type of supply chain,

Customer’s orders act as pull

factor and according to that

products are manufactured.

Inventory

High inventory stock compared

to domestic product.

5 FINDINGS

Major Finding 1 WORKING OF PPMC (PRODUCTION PLANNING

AND MATERIAL CONTROLLING)

F1.1 Step: 1 Demand forecasting of domestic and export product

Demand forecasting is used for estimating future demand of product for

domestic market and international market. Most of companies are used

time series method for estimating future demand .However some large

companies both domestic and multinational employees Business

economists or outsource it from business

consulting or market research firms.

Here some of the methods are given which are generally used by the

company:

Composite of sales fore opinions: company is deciding sales forecast

for particular product.By ask its sales representatives to estimates their

future sales.

Expert opinion: company will obtain forecasts from experts including

dealers, distributors,Suppliers, marketing consultants and trade

associations. Occasionallycompany will invite group of experts to prepare

a forecast

Past sale analysis: sales forecasts can be developed on the basis of

past sales.

1)Time series analysis: breaking down past time series in to four

components. Trend, cycle, seasonal and erratic and projecting these

components in the future.

2) Exponential smoothing method: projecting next period sales by

combining the Average of past sales and most recent sales

3) Statistical demand analysis Consists of measuring the impact level of

each of a set of causal factor: income, marketing expenditures ,price on the

sales level

4) Market-Test method: used for forecasting new- product sales.

After that, calculate net following formula:

production quantities based on sales forecasting by using

Production plan of next month = Sales forecast of

current month + Inventory

norms - Opening stock–

Production plan of current month

Convert production quantities into multiple of batches as per standard

batch size.

Export Sales Orders:

For international market, production is done based on specific Export Sales

order.

Regulatory

Finance

Pack F&D

PRODUCT EXPORT OREDR

It is internal communication document which is prepared by business co-

ordination team and executed by Supply Chain Management Team, describes

customer’s orders and their requirements.

Product export order involves following information:

Consignee’s Name & Address

country

Delivery terms

Payment terms

Mode of shipment like by Air or Sea

Product information ( code, pack, quantity, value)

Special Instructions if any

Last date of submission of ADC

Name of the manufacturer and Location

Name of the buyer

Trade or Tender

After approval of international business team, planning concerned compile the

Product export order for following elements viz.

Batch size

Production feasibility

Process time

Additional specific remarks, if any in product export order.

Products deliverance time based on dosage viz. after receipt of approved

product export order.

Product export order

Shelf life Total Qty Remark value

($ or euro)

Product, strength, brand

Freshly 30000 tabs

Shelf life and pack size Manufactured

1. ATORVASTATIN TABLET

10 MG (Lesstrol 10)

Shelf life: 2 years

3x10 TAB BLISTER

F1.2 STEP-II: Next step is MRP (Material Requirement Planning).

Material Requirement Planning is a production planning and inventory

control system used to manage manufacturing processes.

To run MRP on PHARMASUITE, first of all we have to enter

inputs into PHARMASUITE system.

MRP Inputs:

Bill of Material

Material master

Export order & forecast data

Inventory status file

Bill of Material:

For material requirement planning first get enter in to the

PHARMASUITE and then select location like THOL or DEHARADUN.

Then select Production than go for purchasing than material

requirement planning, we have to select.

n a

c P c

a

e

Whatever Raw material and packaging material is required are

to be planned for EXPORTING (TENDER OR TRADE),

DOMESTIC ORDER (TENDER OR TRADE) Order is come

by export order status and by check list for domestic and PAR

from distribution which are pending orders which have to

provide by production department.

Whatever material is required for manufacturing product and its

material availability status can be known by go into the production

than production planning and then select Material availability status and

then select RM or PM.

MRP (Material Requirements Planning)" is a concept of creating material

plan and production schedules based on the lead times of a supply chain

However, even if you create an MRP-based plan based on an ideal factory

model, problems may still actually occur.

Traditional MRP (or MRP II: Manufacturing Resource Planning) and DRP-based

planning are both techniques of supply chain management. If we collectively call

those methods MR -based supply chain planning, what are the haracteristics

and what are the differences between MRP-based supply chain constraint-

based supply chain planning?

In MRP-based planning, demand plans i.e. sales plans, are created

independently from constraints on created based on the production and

material plans, and production plans are lead times of the supply chain.

If a schedule is created by determining the "product remix", i.e. products to

manufacture and their BOM (Bill of Materials) then exploding processes

and imposing loads on each operation will result in a schedule that

exceeds operation capacity because capacity constraints are not reflected on the

M

m

s

a

p

schedule. If the operation capacity is sufficient then the MRP-based schedule will

be an optimal just-in-time schedule in which the lead time is minimized and

throughput is maximized.

However, in reality, it's often the case that materials are input and production

schedules are carried out exceeding production capacity. This results in in-

process inventory that waits for resources. Even with schedules created for an

ideal factory, there will be in-process inventory that waits for resources, a

build up of excess inventory occur and some operations that are susended due to

insufficient raw materials.

If there is leeway in operation capacity, the MRP can be used as an initial plan

and the difference between the schedule and the actual capacity can be solved by

the schedule controlled by the shop floor. However, if you try to match MRP

directly with actual production then demand should be adjusted so as not to

exceed the actual capacity and you should repeatedly execute the MRP over

and over again. Therefore, an extremely high-speed MRP system will be

required.

Historically, MRP was not as widely spread in Japan as it was in Europe and the

United States. This may have been because there was a gap between the ideal

factory and the actual factory and that lead to the development of "KKD" ("kan"

meaning sense, "keiken" meaning experience, and "dokyo" meaning courage)

to respond to the reality of the shop floor

The planning system of supply chain management emerged as a form of

planning that replaced the "KDD" part with information technology that

furthered scientific planning. JIT (Just-in-Time) is a constraint-based process

management system. If we replace the word "constraint" with "reality", most

Japanese companies will respond that it makes sense.

0s However, in Europe and the U.S., since the planning system was developed

from an MRP-based ideal factory model, the concept of "constraints" is

regarded as a fresh and new concept. TOC (Theory of Constraints) is a

methodology that caused, together with Japan's TQC (Total Quality Control), a

paradigm shift for production management in the U.S. in the 1980s.

CREATION OF MASTER FORMULA RECORD & ARTWORK IN

PHARMASUITE:

First of all Master formula record has been prepared by F & D department.

MFR involves all detailed work instructions. After that F & D shall forward the

duly approved original MFR to Quality Assurance documentation cell for

issuance and distribution to the Technology Transfer department.

Based on MFR, Technology Transfer department shall prepare MMR

(Master Manufacturing RECORD) I,II and forward the duly approved original

MMR-I,II to Quality Assurance department for issuance and distribution to

SCM department for purpose of creating ARTWORK and Material Master on

pharmasuite. After receiving approved MMR-I & II, authorized executive of

supply chain will create Material Master Code and ARTWORK CODE in

PHARMASUITE.

MMR-I: (for Raw Materials)

MMR-II: (for Packaging Materials)

MFC (Master Formula Card)

MMR-I and II (Master Manufacturing Record)

Artwork code, Material Master (PHARMASUITE)

ARTWORK GENERATION BY P&D (PACKAGING AND DEVELOPMENT).

Packaging and development department create ARTWORK which is NEW or

REVISED for different products for different countries and whatever raw material

and packaging material required for that is also indented and revised artwork

is there than code is changed from previous one.Like from 01 to 02.

F 1.4 Step-3: (Raw material / Packaging Material) indenting:-

As we run MRP on PHARMASUITE system, Based on the Purchase

requisition memo, forecast data or orders and current inventory stock

of materials PHARMASUITE system itself raise RM/PM indent

list.RM/PM indent list involves only that RM/PM with their quantities

which have to purchase from vendors.

The main objective of RM/PM indenting is in view of “Optimization of Raw

and Packing materials Inventory”, to determine the net requirement of raw

material and packing material to be procured to deliver the current month (if any

revision) and sub sequent next two month of domestic and export products.

There are five types of scenario, wherein Indents gets generated in

P HARMASUITE system viz.

1) System automated collective generation of Indents

In this type of scenario, PHARMASUITE system automatically generate

RM/PM indent on collective basis after seeing all order and forecast data.

2) New products, RM/PM based on supply chain head approvals

For new product RM/PM, indent shall be raised after approval of supply chain

head approval. And for New product launch proposal

3) Export RM/PM, that is imported from foreign supplier or from domestic

supplier.And all information regarding indenting to material receipt register

can be get from PHARMASUITE.

Indent Details

1) Indent No:

2) Date:

3) Description Code:

4) UOM:

5) Sch qty:

6) Req.Qty:

P.O. Details

1) P.O No:

2) DATE:

3) Name of Supplier:

4) Rate:

5) Delivery due date:

6) G.R.N. No

4) Subjective, as advised by Purchase head, to take price benefit from market

Sometimes purchase head advised to SCM dept to raise indent of

particular RM/PM to get price benefit from market.

After checking of MRP end results, net requirement of Raw and Packing

materials line by line is being checked by material planner. If any correction

in current month and subsequent next two productions plan, appropriate call is

taken for addition and deletion of RM/PM requirement.

F 1.5 Step: 4 Purchase Requisition

After that Purchase department make Purchase Order and it will place the

Purchase order to the approved vendor and send the copy of order to the vendor.

If there is new product, purchase department will approach for 3 quotations

from approved vendors and after that negotiate with vendors and approved one of

them after getting confirmation from Finance department and receiving the

materials on the credit basis.

LEAD TIME CHART

PARAMETERS PRODUCT NORMS

Finish product

process time

Tablet

General

Categary

11 days

Parentals 16 days

Manufacturing

week

Tablets Last day of

asssigned week

Parenterals Last day of

asssigned week

QC release time Sterile 15 days

Non sterile 10 days

Buffer time For all products 7 days

Procurement Packing material 20 days

Raw material 20 days

Imported material

(By air)

15 days

Imported material

(By sea)

30 days

Lead time is the time from the moment the customer places an order (the

moment you learn of the requirement) to the moment it is received by the

customer.

Lead time is made of:

Preprocessing Lead Time: It represents the time required to release a purchase

order (if you buy an item) or create a job (if you manufacture an item) from the

time you learn of the requirement.

Processing Lead Time: It is the time required to procure or manufacture

an item.

Post processing Lead Time: It represents the time to make a purchased item

available in inventory from the time you receive it (including quarantine,

inspection, etc.)

Generally for all the RM/PM, lead time is 30 days at Famycare ltd.

After receiving materials, purchase department send the GR (Goods Receipt) to

SCM and sampling department send the sample to QC for Specification as per the

SOP of Raw material specification.

Purchase Requisition

Purchase order

Goods Receipt

Then QC people test the sample and prepare the ROA and decide the lot number

(BMR& BPR). Head of the QC send this ROA to the purchase dept and SCM.

As per the ROA, prepare the production schedule consulting with the production

dept.

BPR/ BMR form containing the manufacturing and expiry date of the product. As

per the order from the country, lot is divided into the batch depends on the

machine capacity. After this materials are transferred to production dept for

convert into the tablets.

F 1.6 Step-5: Production Scheduling:-

Production scheduling is done with the coordination of production dept,

considering product requirement, material availability, capacity availability and

uniform loading is given by Production department. Production plan of next

month is given to production for scheduling by 6th of every month.

The main objective of production scheduling is to determine the delivery dates

of next month’s production plan.

By taking expected delivery date of RM/PM from purchase department,

production scheduler shall prepared granulation plan for next month and every

day “Granulation plan Vs Actual” shall be generated by production

scheduler. If any deviation in granulation shall be discussed on daily basis as to

meet current month plan.

Scheduling is done in such a manner, that it fulfills market requirement for

domestic products and meet dispatch deadline in case of export orders. Production

schedule should show uniform loading on each machine and effective capacity

utilization.

Products required for next month’s sale are scheduled before 23th so that

product can reach the C&F in time. Priority is given for the products, which are

having higher value and volume to be loaded first and then product with lower

value and volume to be loaded next in scheduling.

Projected capacity utilization report shall be generated (Dosage-wise) for next

month plan by every 5th of succeeding month. After the month end,

“Projected capacity Vs Actual utilization” shall be prepared to show previous

month performance.

Production schedule show all details like which machine are working and

which resources are working and which one is free. How much time require to

produce the listed lot, it show the starting and ending time. Also show the

sequence of the products and total number of batches.

F1.7 Step-6: Production Order:-

To create production order on the basis of planed production and

packaging requirements and advance scheduling, SC will convert planned

production order into production orders, after evaluating the ground situation and

consulting production executive.

As per the production order, SCM will continue check and in contact with the

production department and get the daily report from the production office.

Production dept try to deliver the goods in the bond room or warehouse.

Semi finished goods i.e. sample of tablets (before labeling) are again transfer to

QC. QC will test the all tests as per the SOP prepare the report and send to

packaging department. QC will perform the various test like Dissolution test,

HPLC test, Friability test, GC test, Weight variation etc. and the entire test have

their limit. Semi finished goods must pass all test within the prescribed limit.

Packaging department will pack the semi finished goods as per the order and

use the packing materials which are prescribed in the list of PM. First pack into

primary packing as per the PO i.e. 28 Tablets in one strip. In secondary packing

number of strips in one box i.e. 1×28 T.In Final packing, as per total weight of the

carton - number of box are put into one carton.

On every carton, stick the slip which containing the weight, product name, batch

no, mfg date and expiry date. After all this steps goods are store in bond room.

F2 ISSUES IN PRODUCTION PLANNING AND MATERIAL

CONTROLLING (INBOUND LOGISTIC MANAGEMENT)

1. Inappropriate Material Management

In Famycare pharma company lead time for Raw material and packaging material

is fixed whether it is imported or from domestic.

Lead time for Raw material which is imported is 30 days

Lead time for Raw material which is from domestic company is 20 days

Lead time for packaging material which is from domestic (printed or non-

printed) 20 days

Whenever lead time is increase from vendor due to many reasons whole

production schedule is delayed because of non availability of material and if

company can’t fulfill order of TENDER SALE for domestic and export then

company have to pay fine for that.

Many reasons are there for delaying in packaging and raw material:

1) Inappropriate transportation system that is by sea, railway and road it will take

more time due to many reasons.

2) No response of vendor because of not comfortable of business with company and

less profit.

3) Delay in payment by the company so vendor may not respond next time.

4) There is not matching of quality of material criteria between company and

vendor.

5) If there is excess material sent by vendor to store department.

6) In appropriate material quality given by vendor.

2. Issues Related to new product launching and product management:

When new product is launched by company at domestic level at all states there are

big challenges of supply chain for supplying drugs at all distributors. And it’s

challenge because company don’t know demand of their new product so

appropriate market research study have to carry out by company so at least

company can assume the demand of product otherwise stock out problem can be

occur which is create wrong implication. And whenever company wants to launch

their products, proper stock availability of raw material and packaging material

should be there. Otherwise delay in production schedule and disturbance in

production schedule.

3. Rejection of Raw material and packaging material

Whenever PPMC department had already planned regarding production and

material has already came to the store and it is tested by Q.C department and if

it is rejected then there will be delay in production. This type of problem

arises when there are no similarities in testing criteria of vendor and Q.C

department of company.

4. Machine break down

Some time when machine get breaks down due to many reasons wholly

production schedule has been disturbed because in Famycare pharma there

is no extra shift or machines for avoiding production delay so delay occur.

The causes for breakdown can be:

Failure to identify and replace worn-out parts.

Excessive work load

Inefficient or neglected cooling system.

Too low or too high voltage.

Lack of lubrication etc.

All machines deteriorate with use an exposure, fatigue, impact and

corrosion. Such deterioration indicated by:

Inability of the machine to take specified load.

Reduction in the speed of the machine.

Deterioration in quality of the output by any machine.

Reduction in operational life of the machine.

5. Fulfillment

Some time production order for domestic and export is rejected because it too

small or too big in which production capacity is not matching with the order or

STD batch is not matching. So order can’t not be fulfilled by production.

6. Rejection of contract manufacturing work of other company’s due to busy

production schedule and pending orders which have to complete fastly as

much as possible

Some time in contract manufacturing company (Famycare) has already taken

order but it cannot provide order on time because of busy production schedule and

company’s reputation gets spoiled. Some time whatever order is taken by company

in which finance, costing department are also involved and it is not matching

with standard batch size of production and actual transfer quantity.

7. Material availability status for urgent and additional production planning.

It’s difficult situation in the production for urgent planning or additional

production planning in material availability status have to prepare on urgent

planning bases in which list is prepared from software and have to give to the

Q.C department. So that time if Q.C department can’t release it on time than

Urgent production planning is delayed. So this is big issue.

8. Inappropriate man power in production department.

This is big issue in all companies because if there are not workers in

production department than lot of work is pending and production schedule gets

delayed.

9. Urgent ADC COA of products which are used for export purpose.

Some time export department intimate to the PPMC department and

distribution department for urgent ADC COA for export purpose so PPMC

department will intimate to the parenteral and tablet packing department and

Q.C department for urgent release so planning of packing and Q.C department

gets disturbed.

10. Daily Receipt Transfer stock statement

According to this statement actual product dispatch date for export product

and sale product for India like tender and trade, under release product can

be removed by checking daily release product COA and BMR and BPR status.

11. Bull whip effect

Some time due to continuously change in demand forecasting of particular

product and some time due to urgent production planning of particular product due

to urgent demand there is lot of problem in inventory management of that

materials which are required for that product manufacturing and some time supply

chain management department can’t provide product on time to distribution

department and due to this stock out problem is to be created and company image

is not good in front of customer and consumer.

Many factors are there for breaking of supply chain management.

In appropriate dealing with vendors.

Inappropriate transportation system of vendors or company.

Transportation delay due to many reasons.

Material rejection by Quality control department.

Rejection of contract manufacturing work of other company’s due to busy

production schedule and pending orders which have to complete fastly as much as

possible.

There is inappropriate manpower in production department and other department.

In appropriate documentation work by Quality assurance department.

Inappropriate artwork code generation by packaging and development department

and inappropriate labelling.

Inappropriate rules and regulations followed by regulatory affair department.

Inappropriate production schedule and inventory management which is done by

production planning and material management department.

12. Urgent testing of material which is given to the outside laboratory

For testing of material, and whatever date has given by them is not

correct or whatever date they have committed they are not following.

13. Transfer product

Some time due to urgent production order, production schedule is suddenly

changed, and whatever product is running in at any stage is stopped, and after

considering clearance time product which are on urgent basis is to be run on

production, so for this urgent indenting, continuously follow up with purchase

department, after completing production whatever product is removed from

schedule or transferred is carried out and another extra COA is required for

that.

F2.1 SUGGESTION

1. Inappropriate material management

This is big issue for PPMC and purchasing both because both are involved in this

process, here for avoiding material shortage proper buffer stock is keeping for

particular product for which demand is continuously grown day by day. Based

on demand forecasting data PPMC can know for supply of product and it’s

planning, if material is not receiving as per the company’s specification criteria

than it should be rejected by company. Proper vendor dealing should be there and

material is rejected by Q.C then urgent indenting is to be done by software.

2. Issues Related to new product launching and product management:

Co-operation: Collaborative planning, forecasting and replenishment (CPFR) is

longer term commitment, joint work on quality and support by the a buyer of

the suppliers, managerial, technological and capacity development. This

relationship allows a company to have access to current, reliable information,

obtain lower inventory levels, cut lead times, enhance product quality, improve

forecasting accuracy and ultimately improve customer service and overall

profits.However, it may be noted that while supply chain management

provides several opportunities to the companies in a competitive business

environment, there are certain problems which supply chain managers must

address.

1) Distribution network configuration: number and location of suppliers,

production ,facilities, distribution centers, warehouses and customers.

2) Distribution strategy: centralized versus decentralized, direct shipment,

cross-docking, pull or push strategies, third party logistics etc.

3) Information: integrate systems and processes through the supply chain to

share valuable information, including demand forecasts, inventory and

transportation.

4) Inventory management: Quantity and location of inventory including raw

materials, work in process and finished goods.

3. Rejection of Raw material and packaging material

This create big issue when RM and PM is rejected by Q.C department so proper

vendor is to be selected and urgent re indenting is to be done by company to

vendor for re supply of that RM and PM. And separate folder should be there for

urgent indenting.

4. Machine breakdown.

Suggestion

Plant maintenance is of great importance as it provides a means to maintain the

plant and equipment in a high state of operating efficiency and enhance its

productivity.

Breakdown Maintenance should be attended on the sudden break down of

machine in emergency.

Preventive maintenance is an activity which prevents breakdowns, cut operating

costs and improve quality of the product. It is a systematic maintenance procedure

wherein the condition of the equipment is constantly watched through systematic

inspection and preventive action is taken to reduce the incidence of breakdown.

5. Fulfilment

Ensuring the right quantity of parts for production or products for sale arrives at

the right time when they are needed in right quantities and quality. This is

accomplished through efficient communication, ensuring that orders are placed

with the appropriate amount of time available to be filled.

6. Contract manufacturing and pending export order

In Famycare phatma for different products standard batch size are decided so if

order is too much high or too much low then PPMC department or internal

logistic management department will reject order & they intimate international

business department for rejecting order & they also intimate to costing department

for intimating the suitable amendmend with party which want to give contract to

this company.

7. Material availability status for urgent production planning

Some time Raw Material And Packaging material are keeping in to buffer stock

which are most of used in company’s famous brand. So buffer inventory stock

should be kept in go down and proper inventory management should be done by

the company. Additional plan is prepared for urgent production planning and

vendor should be more responsive compared to the other vendor which is taking

longer time.

8. Inappropriate manpower in production department

This is biggest challenge for the human resource management department to

manage effective man power at production site because in parenteral and tablet

production department, for parenteral washing, manufacturing and filling is

involved and for each stage clearance time is required and workers are

needed and also for tablet packing area workers are required.

At different stages of production of tablet workers and more employees are

required. If there is in deficiency then delay in production schedule.

9. Urgent ADC COA requirement for partial shipment

Some time for export department want urgent ADC COA because they want

partial shipment but at that time product shows failure in Q.C department than

company have to give that product for outside testing.

10. Bull whip effect

Due to continuously change of the demand of the product in the market there will

be lot of problem creating in to the material availability status & PPMC can’t

accept order some time which is very less order as per the std batch size. Some

time order is so much high so company doesn’t have production capacity to

fulfill order so proper demand forecasting should be there by marketing

department so there is no problem at all.

11. Daily receipt transfer stock statement.

By observing this statement the product in which state that can be

identified like production, packing, QA or Q.C that can be known and product

can be released by pressurize all departments for effective co-ordination of all

department. So lead time of finish product and material transit time can be

decreased.

12. Urgent testing of material given by company to the laboratory.

This creates critical condition some time because whatever commitment has

given by the laboratory to the company to the laboratory is not followed by them

than unnecessary delay occur and ADC COA can’t send to the drug commissioner

on time and due to this shipment of product can be delay and there is loss of the

company’s repo.

13 .Transferring product.

In this situation production department give intimation to the Q.C department

for this matter. Whenever remaining packing is done by the packing department

then Q.C department prepare second time same COA for that and again COA

with sample is sending again.

F3 SUGGESTED MANAGEMENT CONCEPT FOR IMPROVING

PRODUCTIVITY OF PRODUCTION LINE AND MAKING

EFFECTIVE INVENTORY MANAGEMENT

F3.1 INVENTORY MANAGEMENT

Effective management of your inventory

Improved inventory efficiency can release cash back to the business. The demands

of greater service at lower cost are unrelenting and this becomes even more acute

when you have extended supply chains in place, often including sourcing in

low cost countries.

The amount of inventory you hold and its location are critical elements

in determining product availability to customers and can also significantly

influence the time-to-market for your new products.

The sophisticated ERP system you have in place to manage your supply chains

may only deliver usable management information with huge effort.

Inventory as a strategic asset

By deploying inventory as a strategic asset rather than a tactical sticking

plaster, you can achieve:

1) Higher service levels with reduced inventory

2) Simplified planning processes

3) Reduced obsolescence

4) Significant liberation of cash.

However, this can only really be delivered in a sustainable way if the current

inventory deployment can be modelled and assessed, and alternative strategies

developed and tested in a ‘safe environment’ before any implementation of

change.

The inventory profile can then be reviewed and re- aligned as the business

evolves into new market or new products come on stream.

The benefits of inventory optimization In our experience the effective

long term management of inventory –

1) Acts as the catalyst for balancing supply chain activities by repositioning

inventory around business.

2) Integrates inventory and distribution strategies to provide lowest overall

operational cost

3) Creates an environment for market leading product availability.

Practically, inventory management is all about ensuring that everything about

your stock is well planned and organized such that there is easy flow of stock

within and outside the firm.

This means that you must have enough stocks to satisfy all orders and ensure that

customers continue to have stocks at all time. It is a complex things and quite

challenging. However, some programs have helped in reducing the stress of

using varieties of formulas in getting reorder level, maximum and minimum

stock level, warning level, annual demand, etc. This is about INVENTORY

OR STOCK CONTROL.

In managing you stocks in a pharmaceutical company, you must learn first

how to keep proper records. You must be very versatile in this and like

figures especially when you handle over 100 different types of drugs and some

have different strengths e.g. 10mg, 25mg, 50mg, 100mg, 500mg, 1g,

4000iu, 10000iu, 20000iu, etc. Some of the documents you must have and

make use of it.

DELIVERY NOTE (DN): This records all drugs and materials leaving the store

to the customers, office workers and donations to institutions. It must have

Date, Particular (for drug name, expiry date, batch number and strength),

packaging details (e.g. bottles, vial, PC, etc), Name and Address of the consignee,

serial number, signature space for the store manager and the receiver. It could be

duplicated in pink or be in triplicate.

GOODS RETURN FORM (GRF): It records all goods return and in good

condition.

GOOD RECEIVE NOTE (GRN): It records all imported stocks as they enter the

store i.e. stocks imported from manufacturer and being received into the store or

stocks received from the production department into the store and ready to be

issued out.

PRODUCT REQUSITION NOTE (PRN): It records all requests for order

placement forwarded to the purchasing manager or procurement department

when stocks reach reorder level. It should specify which stock needs to be

replenished and the quantity to be ordered (though the procurement

manager may know the right quantity to procure within the financial

constraint of the organization).

WAYBILL: This is a store document that accompanies stocks being moved out

of the organization which must be presented when stopped on the way either by

the organization's security men or force on the way to the customer's

warehouse or store.

BIN CARD: This is a document showing daily incoming and outgoing of

stocks in and out of the store or warehouse. It must show the consignee's name

and address, batch number, expiry date, quantity, signature and the balance (on

continuous basis). FIFO should be strictly applied so as to avoid loss due to

expiration of drugs.

INVENTORY SOFTWARE: Inventory management and control software could

be installed on the office system for daily posting and accurate report as enerated

by the tested and tried program. Good ones include inflow inventory rogram,

Chromos stock Card, Inventorial Manager Stock etc.

The stock control strategy is also necessary for effective and efficient management

of the warehouse. Lots of software now exists to remove difficulties in this area.

In controlling the warehouse stocks, the control measure/software/program should

be able to determine the following upon which right decision should/could be

taken.

1. MAXIMUM STOCK LEVEL

2. MINIMUM STOCK LEVEL

3. REORDER LEVEL OF STOCK

4. REORDER QUANTITY

5. WARNING LEVEL FOR STOCK

6. NORMAL CONSUMPTION

7. NORMAL REORDER PERIOD

8. ANNUAL DEMAND OR QUANTITY

The manual method of stock control is fast fading out though some organizations

still make use of it. However, daily check is needed to ensure efficiency.

Computers these days have helped to save such time because alert props up when

stocks need to be reorder, below minimum level, when over stock, etc.

F3.2 SOME IMPORTANT MANAGEMENT CONCEPTS:

Before moving on to conclusion, a few important Management tools that

can help increase the efficiency of PPC in an organization are described below

F3.2.1 Just In Time Concept:

Just in time (JIT) is a production strategy that strives to improve a business

return on investment by reducing in-process inventory and associated carrying

costs.

Just in Time approach suggests that inventories should be available when a firm

needs them not earlier, not later. Generally just-in-time systems are designed to

manage lead times and to eliminate waste. Effective implementation of the JIT

concept can greatly reduce inventories of raw materials and finished goods. This

concept relies heavily on the quality of manufactured products, components

and also on a capable and precise logistics system to manage supply of incoming

materials (i.e. out-bound logistics).

Four major elements of JIT concept are:

(1) Zero Inventories

(2) Short lead times

(3) Frequent replenishment quantities

(4) High quality or zero defects

JIT is a modern approach for procurement, production, inventory and

distribution management all integrated into one single system. It includes a

comprehensive culture of quality (Total Quality Management), vendor partnerships

and employee teams. Just-In- Time employs small lot sizes (as small as one unit)

and very short lead times for both procurement and production, thereby reducing

the production cycle time.

Salient features of JIT systems as follows:

JIT attempts to eliminate excess inventories for both the seller and the buyer

JIT systems involve short production runs due to small lot sizes. However it

requires techniques to reduce production set-up times and to control and

minimize cost of frequent changeovers.

JIT minimizes waiting lines by delivering materials and components when and

where firms need them.

JIT concept uses short, consistent lead times to satisfy the need for more

inventories in a timely manner. This requires suppliers to be located as near as

possible to the buyer firms (manufacturing facilities)

JIT based systems rely on high-quality incoming materials and parts and on

highly efficient inbound logistics operations.

JIT concept requires a strong, mutual commitment between the buyer and seller,

the one that emphasize quality and seeks win-win types of relationship between

both parties.

PHILOSOPHY:

The philosophy of JIT is simple: inventory is waste. JIT inventory systems

expose hidden cost of keeping inventory, and are therefore not a simple solution

for a company to adopt. The company must follow an array of new

methods to manage the consequences of the change. The ideas in this way of

working come from many different disciplines including statistics, industrial

engineering, production management, and behavioral science. The JIT inventory

philosophy defines how inventory is viewed and how it relates to management.

Inventory is seen as incurring costs, or waste, instead of adding and storing

value, contrary to traditional accounting. This does not mean to say JIT is

implemented without awareness that removing inventory exposes pre-existing

manufacturing issues. This way of working encourages businesses to eliminate

inventory that does not compensate for manufacturing process issues, and to

constantly improve those processes to require less inventory. Secondly, allowing

any stock habituates management to stock keeping. Management may be tempted

to keep stock to hide production problems. These problems include backups at

work centers, machine reliability, and process variability, lack of flexibility of

employees and equipment, and inadequate capacity. In short, the Just-in-Time

inventory system focus is having “the right material, at the right time, at the

right place, and in the exact amount”.

Benefits

Main benefits of JIT include:

Reduced setup time. Cutting setup time allows the company to reduce or

eliminate inventory for "changeover" time.

The flow of goods from warehouse to shelves improves. Small or individual

piece lot sizes reduce lot delay inventories, which simplifies inventory flow and

its management.

Employees with multiple skills are used more efficiently. Having employees

trained to work on different parts of the process allows companies to move

workers where they are needed.

Production scheduling and work hour consistency synchronized with

demand. If there is no demand for a product at the time, it is not made. This

saves the company money, either by not having to pay workers overtime or by

having them focus on other work or participate in training.

Increased emphasis on supplier relationships. A company without inventory

does not want a supply system problem that creates a part shortage. This makes

supplier relationships extremely important.

Supplies come in at regular intervals throughout the production day. Supply

is synchronized with production demand and the optimal amount of inventory is

on hand at any time. When parts move directly from the truck to the point of

assembly, the need for storage facilities is reduced.

Minimizes storage space needed.

Smaller chance of inventory breaking/expiring.

F3.2.2. Collaborative Planning, Forecasting, and Replenishment (CPFR):

The objective of CPFR is to optimize supply chain through improved demand

forecasts,with the right product delivered at right time to the right

location,with reduced inventories, avoidance of stock-outs, and improved

customer service. The value of CPFR lies in the broad exchange of forecasting

information to improve forecasting accuracy when both the buyer and seller

collaborate through joint knowledge of sales, promotions,and relevant supply and

demand information.

Major activities of CPFR:

Three major activities constitute CPFR: they are planning, forecasting,

and replenishment. There are a few steps involved in each activity. Planning:

Planning starts with a contract that details the responsibilities of the

companies that will collaborate with each other in providing the right

products for customers. Contract terms should be negotiated first. Then a

joint business plan regarding demand management, sales promotion, production

quantity, timing, inventory level, will be developed.

Forecasting: First, customer demand is predicted for all the participating

firms. Any differences in demand among participating firms will then be

identified and resolved. Finally, a feasible sales forecast for all participating

firms is developed. Modifications may be done periodically to reflect the changes

in market demand.

Replenishment: First, orders for all participating firms are estimated. Any

difference among participating firms are identified and resolved. Finally, an

efficient production and delivery schedule is developed. Orders are fulfilled.

Vendor Managed Inventory

Vendor managed inventory is a modification of quick response system that

eliminates the need for replenishment orders. It is a customer service strategy used

to manage the customer’s inventory for reducing cost and improving services.

VMI establishes a supply chain arrangement which is so flexible and efficient that

retail industry is continuously replenished.

Vendor-managed inventory (VMI) employs the same principles as those of

JIT inventory, however, the responsibilities of managing inventory is placed with

the vendor in a vendor/customer relationship. Whether it’s a manufacturer

managing inventory for a distributor, or a distributor managing inventory for their

customers, the management role goes to the vendor.

An advantage of this business model is that the vendor may have industry experie

nce and expertise that lets them better anticipates demand and inventory needs. The

inventory planning and controlling is facilitated by applications that allow vendors

access to their customer's inventory data.

In quick response system the buyer (retailer) makes the decision regarding setting

target inventory levels and restocking (or replenishment orders). But in VMI,

the supplier assumes more responsibility and actually manages a category of

inventory for the customers (buyer or retailer). The supplier (or vendor) receives

the information regarding the daily retail sales or sizes, varieties and styles of the

products needed by the customers (retailer). In some situations, replenishment

involves cross docking or direct store delivery which eliminate the need for

warehousing between the manufacturing firm and retail stores.

F3.2.3 Total Quality Management

TQM is an integrative philosophy of management for continuously improving the

quality of products and processes. It is used around the world in many

organizations.TQM functions on the premise that the quality of products

and processes is the responsibility of everyone who is involved with the

creation or consumption of the products or services offered by an organization.

In other words, TQM capitalizes on the involvement of management,

workforce, suppliers, and even customers, in order to meet or exceed customer

expectations. Considering the practices of TQM as discussed in six empirical

studies, Cue, Mc Kone, and Schroeder (2001) identified the nine common

TQM practices as cross-functional product design, process management,

supplier quality management, customer involvement, information and

feedback, committed leadership, strategic planning, cross- functional training, and

employee involvement.

TQM benefits:

Reduced cost of operations

Implementation of TQM delivers better products and service quality,

number of errors/defects, the reduction of total quality costs, better processes

and productivity. These terms will help to reduce cost of operations.

Improvement in company morale

Employee’s empowerment through the use of teamwork, education and

h

training, employee involvement, better employee relations, giving employees

incentives and rewards, and responsibilities for making decisions will also

cultivate friendly and a happy working environment.

Establishing a process of continuous improvement and innovation

TQM is the best way to improve organizational output through continuously

improved performance. TQM is a good management practice which helps in

developing new and innovative ideas to satisfy its customers, this helps in

continuous improvement of quality services.

Increased customer satisfaction

TQM takes care of customer’ expectation through quality information and

performance measurement principles and thus, maintaining continuous

improvement in quality of services and demand of customers.

F3.2.4 Theory of Constraints:

The Theory of Constraints (TOC) is an overall management philosopy

introduced by Eliyahu Mr. Gold rat in his 1984 book titled , that is geared to

help organizations continually achieve their goals.

The theory of constraints is both descriptive and prescriptive in nature; it not

only describes the cause of system constraints, but also provides guidance on how

to resolve them. Theory of Constraints implementations around the world found

that huge results were consistently achieved:

m

e o

Lead Times Reduced 69%

Cycle Times Reduced 66%

Due Date Performance Improved 60%

Inventory Levels Reduced 50%

Revenue / Throughput Increased 68%

Five Focusing Steps:

1. Identify the constraint (the resource or policy that prevents the organization from

obtaining more of the goal)

2. Decide how to exploit the constraint (get the most capacity out of the constrained

process)

3. Subordinate all other processes to above decision (align the whole system or

organization to support the decision made above)

4. Elevate the constraint (make other major changes needed to break the constraint)

5. If, as a result of these steps, the constraint has moved, return to Step 1.

Application of the Principles:

At any point of time an organization can have one constraining area which

limits the ability of the organization to make more money. The constraining

area can be in manufacturing (not able to deliver despite having a good

backlog) or distribution (not able to make right product available at right place) or

new product development (a faster pace of development will increase rate of

sales) or the market (sales is stagnant and price reduction appears as the only way

to increase sales).

Drum Buffer Rope: developed to exploit the manufacturing resource constraint.

The application of drum-buffer-rope and buffer management helps

manufacturing organizations release hidden capacity while improving reliability

of deliveries with lead time reduction.

TOC Replenishment: develop for organization in the distribution and retail

business. This application helps making right product available at right time and

place with much lower inventory. TOC replenishment helps plug the loss sales

due to unavailability.

Throughput Accounting:

Throughput accounting was developed to improve effectiveness of

financial decision making. Most business decisions made using cost

accounting rules can be erroneous and can lead to cost or revenue leakages.

9 What is Benchmarking?

• Qualitative Benchmarking

– Comparing best practices among organizations

– Maturity Assessments

• Quantitative Benchmarking

– Comparing levels of measured performance

– Assessment of Performance Gaps

• Competitive Benchmarking

– Quantitative Benchmarking between companies

– Identifies superior relative performance

Planning Data Gathering: Sources of Data

• Financial Data

– 10-K data, Company Annual Reports, Cost Center Reports

– Must be Verified by Financial Team (Controller)

• Non-Financial Data

– Customers

• Delivery Performance

• Total Cycle-Time Performance

– IT Systems

• Process-to-Process Transactions

• Planning System Parameters (Lead Times)

– Suppliers

– 3PL Providers

Health Sector Supply Chain

Industry Challenges & Responses

Benchmarking Success

Health Care Industry

Tends to drive change through looking outside their organizations

Benchmarks tend to be outcome measures & provide “gap”

analysis

10. INITIALFINDINGS: HEALTH SECTOR SUPPLY CHAIN

Metric-benchmarking used to target cost reductions or negotiate lower prices

Little emphasis placed on agility, sustainability, and safety

Very few organizations measure supplier performance and customer

satisfaction

Limited measures of internal-facing supply chain capabilities

Emerging process measurement through technology implementations and six

sigma projects.

Measures of customer service and relationship management need to be

developed.

Substantial amount of effort on compliance and accuracy measures.

Proper vendor management should be improved for increase the

efficiency of the supply chain management.

It is very critical process because if any constrain created in the process than

wholl chain get disturbed and supply chain management have to continuously

monitor this process and stabilize it and prevent to break it, and decrease material

transit time between all department.

11 CONCLUSION

1) Complexity of the health sector supply chain is not likely to be reduced.

2) Unique health sector service processes need to be considered.

3) Not all “best practices” from the manufacturing industries will, or should

be,transferred to the health sector industry.

4) Industry-wide benchmarking should lead to sustained improvement

without comprising a critical link in the chain

5) Production planning and control function is the nerve centre or heart of the

production management function. It coordinates all phases of the production

system. An efficient production planning and control function results in higher

quality, better utilization ofresources, reduced inventories, reduced

manufacturing cycle time, faster delivery, better customer service, lower

production costs, timely delivery and right quality of goods/services at the

right cost.

6) An efficient production planning and control system enables the firm to

improve its sales turnover, market share and profitability and provides a

competitive advantage for the firm due to balanced inventory levels and higher

quality, flexibility and dependability and lower prices which are the performance

factor for the firm.

7) It put more effort to reduce material transit time from vendor to finished goods in

to domestic and international market.

8) To provide strong presence in foreign market and to supply products smoothly

in national and international market.

9) Time is money, if we can’t improve efficiency beyond some specific point

because there is limit of supply chain so if we want to make it more effective

than we have to reduce expenses at each and every stages.

So supply chain expense saving = profit

12. REFERANCE

1) www.Famycarepharma.com

2) Inventory-Wikipedia .com

3) www.Filehippo.com

4) www.newagepublishers.com

5) www.thehackettgroup.com

6) Logistic and supply chain management by aswathappa

Publication year:2010, Edition: 4th