Lakshya is an initiative by Club Kaizen which is our monthly supplement designed for people who dare to think above the average and believe in connecting the dots. In an age where technology has taken over every sphere, information is abundant and data is omnipresent, we have conspired to bring to you a collection of thoughtfully created and carefully curated pieces of work by some bright aspiring minds of ICFAI Business School, Hyderabad on the current trends and hot topics in the field of Operations Management and their relevance in different Industries. Everything is growing at the pace of nanosecond and hence it is quintessential to know about every minute change in the eco system. With Lakshya we aim to present our readers with compact yet explicit articles on vivid topics such as Internet, Banking, IT, IoT, etc. A fair share of this edition focuses majorly on the banking systems and payment gateways. With the constantly evolving technology it will be interesting to ponder over changes that could be seen in the near future. We look forward to providing the students with some valuable insights and inculcate the passion for reading once again within our readers. Lakshya is an amazing platform for readers as well as aspiring readers to showcase their talent and pen down their thoughts which in turn will be a gold mine for information for the students of not only IBS but from the outside world too.
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OUR KNOWLEDGE PARTNER
Club Kaizen is privileged to have The International Supply Chain Education Alliance (ISCEA, USA) as the Knowledge Partner from Lakshya’s 24th edition. To be a single source for Total Supply Chain Knowledge through Education, Certification, and Recognition is the mission of ISCEA. Many workshops/events are conducted by ISCEA to improve the knowledge of manufacturing and service industry professionals. ISCEA provides a platform to explore leadership potential to the aspiring leaders in the supply chain industry while developing the skill sets and knowledge desired by corporations, through SCNext (ISCEA Young Supply Chain Professional Association). Some of the internationally recognized certification programs developed by ISCEA include1. Certified Supply Chain Analyst (CSCA). 2. Certified Demand Driven Planner (CDDP). 3. Supply Chain Case Competition. To know more about ISCEA, visit http://www.iscea.net/india. We look forward to working with ISCEA in spreading knowledge and reaching greater heights together.
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EDITOR’S LETTER “"Success is the sum of small efforts, repeated day in day out."” Welcome to the 38th edition of “LAKSHYA”, our monthly supplement designed for people who dare to think above the average and believe in connecting the dots. We live in a technological era where an individual need to enhance his/her skills in every aspect that they deal with. Kaizen means continuous improvement for that to happen, everyone should stay updated and informed. Magazine is a kind of tool that aids students and professional managers to get deeper insights about the current trends and latest happenings around the world. Lakshya is an amalgamation of articles from corporate professionals, faculties, and students from reputed organisations and institutions. The articles that are published through Lakshya have the essence of hands on experience from corporate professionals and business leaders, theoretical concepts and strategies from faculties, organic and fresh ideas from the young pool of budding managers. Also most important aspect of magazine is that it creates an opportunity for students to enhance and improve their writing skills, it would also create a platform for them to enrich their thought process when they research and write articles. We hope that you like this issue and please let us know if there are any subjects, you'd look forward to be addressed in upcoming editions. Please write to us and become a part of this discussion. Email ID: kaizenclub.ibs@gmail.com
K Pavan Kumar Reddy Editor-In-Chief - KORE Kaizen – IBS Hyderabad Batch 2020-22
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CONTENTS
S. NO.
TITLE
PAGE NO.
1
From the Mentor’s Desk
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2
Importance of Yard Management System (YDS)
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2
SUPPL Cyber Security Awareness
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3
Microfinance-Operation and challenges during Covid
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4
Understanding expected returns in the impact investing sector valuation perspectives
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5
Byju’s – The unsurpassed Unicorn
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From no mobility to future mobility: Where covid-19 has accelerated change
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Operations vs Marketing: See-Saw Couple
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Pause
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Supply Chain Resiliency and the need for stress tests
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The Time Banks
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Operations in Healthcare
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Operations Management in Banking sector
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Statistical process control
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From the Mentor’s Desk In the era of competition, it is imperative for students to be prepared for the ever-changing business environment. Knowledge creation plays an important role to learn to tackle the dynamic nature of business. I appreciate and congratulate the initiative of club KAIZEN for bridging the gap between corporate world and academia through LAKSHYA which is an excellent platform where industry practitioners, academicians and researchers can share their knowledge and experience, acting as a beacon guiding students to reach their goal. My best wishes to club KAIZEN in their endeavour of knowledge creation through LAKSHYA.
Nishit Kumar Srivastava Mentor, Club Kaizen
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Mrs. Vidya Krishnamoorthy Assistant Professor, Stella Maris College, Chennai.
Importance Of Yard Management System (YMS) What is YMS? A yard management system (YMS) is a software programme that monitors the movement of vehicles and trailers in a manufacturing facilities, warehouse's, or distribution centre’s yard. YMS gives yard staff real-time information on the location of trailers in the yard, allowing them to transfer trailers from staging to docks quickly to satisfy orders. Warehouse management systems (WMS) and transportation management systems (TMS) are frequently used in conjunction with YMS (TMS). It could also be equipped with radio frequency identification (RFID) technology for faster and more precise tracking. Transportation → Yard → Warehouse Many companies are considering ways to improve their yard operations as a result of recent supply chain disruption. A yard management solution, which can be a warehouse management system add-on, a standalone solution, a homemade system, and more, is a significant instrument in yard optimization. Understanding your alternatives is critical to finding the best solution for your company.
Challenges Associated with YMS • Lack of visibility of trailer • Lack of visibility of shipment • Chances of process misalignment • Yard inefficiency Benefits of YMS It's critical to understand the impact yard management software can have on your business, as well as what you should look for while looking for the ideal solution. “Shorter transportation lead times and increasing transportation costs push companies to increase their efficiencies in the yard, as time spent on a yard can be unproductive and costly… Consequently, it becomes even more critical for shippers to find time savings elsewhere in their supply chains. Boosting throughput by using a YMS means trucks spend more minutes with their wheels turning” – Gartner’s Market Guide for Yard Management
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Some of the benefits of YMS are: Improvement of the process: Modern yard management systems help automate formerly manual yard procedures such as gate-in, gate-out, and appointment scheduling. This improves benchmarking by increasing the accuracy of inputs and outputs. Shippers and 3PLs can use reports and analytics from a contemporary YMS to define and assess effective KPIs. Cost Reduction: The lowering of costs across an organization's yard operations is one of the most essential tasks of a yard management solution. By automating and digitising processes and scheduling appointments to maintain seamless carrier operations, an efficient YMS will reduce demurrage and detention cost. Safety: By removing the need for employees to wander around the yard performing manual checks, a YMS can improve safety. Yard truck drivers' speed, safe practises, and hours of service are all monitored by instrumentation on the trucks. The YMS also assists in the security of the yard by keeping track of all movements from check-in to check-out. Scheduling: Shippers and carriers can use the nextgeneration YMS to replace time-consuming communication techniques like email and phone calls with an integrated appointment scheduling site. Return on Investment (ROI) Decreased detention/demurrage expenses due to better visibility into trailer status and dwell durations; decreased labour costs due to more effective yard jockeys; reduced infrastructure costs due to the
elimination of yard cars; and more. Reduced detention expense has been the most significant area of improvement in the yard for many organisations, with real-time trailer and load status awareness being the main drivers of those savings. While the most significant influences on ROI vary by location, the typical YMS deployment yields the following returns on investment: • Increased workforce efficiency • Increased throughput • Decreased costs • Increase in savings Choosing the best yard management solution necessitates a thorough examination of an organization's needs and objectives. In-depth yard management, an end-to-end in-transit visibility solution, or a less thorough solution may be required by your firm. Regardless of the conclusion of this evaluation, a digital solution can assist enterprises of any size in automating and optimising yard operations. Advancements in YMS • 5G support • AI integration for scanning bills • Automatic vehicles • Real-time visibility • Load optimization • Improved Supply Chain The advancement in technology will keep on upgrading the features of YMS. The sole motive of any organization is to improve its operations and reduce cost. YMS is the perfect solution for achieving both the goals.
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Corporate Angle Ms. Ragini Mishra Senior Analyst in Northern Trust
Cyber Security Awareness Cyber Security Awareness Research suggests that human error is involved in more than 90% of security breaches. Security awareness training helps to minimize risk thus preventing the loss of PII, IP, and money or brand reputation. An effective awareness training program addresses the cyber security mistakes that employees may make when using email, the web and in the physical world such as tailgating or improper document disposal.
Cybersecurity awareness tips: 1) Set up a Formal Cybersecurity Training Program One of the most direct ways to increase cyber security awareness in any organization is to create a formal training program centered on cyber security practices. When an organization has a formal cyber security training program, there is little room for doubt that security awareness is an important issue to the larger organization—not to mention that the employees have been made aware of what they should and should not do. In fact, starting a cyber-security training program helps to shore up one of the biggest network security vulnerabilities in any organization: the people who work for the organization. Insider threats consistently rank high on top cyber threat lists, as employees may accidentally fall for phishing attacks or similar social engineering attacks. In fact, according to Securitymagazine.com, “Financial pretexting and phishing represent 98 percent of
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social incidents and 93 percent of all breaches investigated.” Training employees to recognize phishing and social engineering attacks helps them to be more aware of these cyber threats—reducing the likelihood that they’ll fall for these schemes in the future. 2) Test Employee Cyber Security Awareness Organizations should test employees on their security awareness from time to time to ensure that the lessons were actually learned. These tests can take numerous forms—from simple assessments that occur at the end of a training program to randomized fake phishing emails designed to see if employees will fall for them. Testing employee cyber security awareness helps to reinforce the lessons from the formal training programs—as well as highlighting gaps in security awareness amongst employees. For example, if more than half of all employees fall for the same trick, odds are good that this is an awareness gap that needs to be addressed. On completing a test, it may help to provide the assessment results to employees so they can see what they need to work on. Businesses can also have their IT security teams review these results so they can modify the security program to account for the weakness (or recommend training resources to close the security gap). Practical testing, or learning by doing, can be particularly effective for improving retention of information—which naturally leads to better cyber security awareness. As noted in one Forbes article on the subject of experiential learning, “Retention and confidence are far greater when participants have had the opportunity to practice coaching, delegating and listening. Combine that with reflection time and feedback, and you have the best training scenario and ROI!”
3) Circulate Major Cyber Security Incidents in Meetings or Newsletters Another way to raise awareness of cyber risks in an organization is to highlight major cyber security events in your industry when they occur. Regrettably, it probably won’t be too long before there are several good examples to share—one Business Insider article published in late August highlights no fewer than 16 massive data breaches that occurred over the course of the previous year. Bringing up these cyber security incidents and their underlying causes during meetings with team members is a great way to improve cyber security awareness throughout an organization. It also helps to highlight why following cyber security best practices is a good idea to employees—largely by demonstrating how weak cyber security practices could adversely impact the organization as a whole. If it simply isn’t possible to have team leaders engage in face-to-face meetings with team members to discuss cyber security incidents within their industry, it may help to distribute stories about cyber security incidents in an internal newsletter or mass email. While not as effective as having a personal conversation with employees, emails highlighting major breaches can help to improve awareness of specific cyber risks that other companies in your industry have fallen for. Benefits of Cyber Security Awareness:
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Increased Security Making your team at large aware of the many threats that exist – from data breaches to ransom ware – will keep them from making simple mistakes that could threaten the safety of your organization. If your teams are uninformed about the capabilities of hackers, a moment could cost you. A lot can stem from an employee checking their email on a smartphone while using a public Wi-Fi network, for instance. If everyone in your business is taking the same security measures, a breach is much less likely to happen.
their actions. If they know what a phishing email looks like, they’re less likely to ponder opening the suspicious message. They’ll instead send it right to the trash bin. This confidence is key. With employees empowered to act with confidence and awareness of the risks, they’ll be less likely to make the kind of human error that could cause a devastating breach. They will also be less likely to waste time debating their actions or waiting to inquire with IT about a simple, basic problem. Armed with the proper knowledge, they can tackle daily threats and occurrences themselves. Retain Customers’ Trust
Time and Money Saved Cyber security training for your team is also a wise investment. It is estimated that data breaches and similar attacks cost companies about $400 billion each year. In the United States, a single attack could cost a company $15.4 million. Therefore, the cost of excellent cyber security training is well worth it if it prevents even a single attack. And naturally, the same goes for time spent. If an attack were to occur, your team would spend a significant amount of their energy attempting to plug the holes and repair the damage. That time could be much better spent conducting other functions of business. Empowering Your Workforce You don’t want your employees second-guessing
A survey of 2,000 respondents showed that about 86.6% of those asked were hesitant to patron a business that experienced a data breach in which credit or debit card information was compromised. That’s over 1,700 people who would lose faith in an organization as a result of what could be a simple, quick mistake. Obviously, an attack could seriously damage a company’s credibility. And not only could this result in a loss of customers, but also risk partnerships with other businesses. Such relationships will appear to be more of a risk after an incident. The benefits far outweigh the losses when it comes to cyber security training. So, ensure that your workforce is well equipped with the knowledge that will keep your organization safe.
About the author Ms. Ragini Mishra Dynamic professional with almost 5.6 years of experience in Program Management and currently working as Senior Analyst and managing Software Security Lifecycle Management in Northern Trust.
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The Corporate Angle
Mr. Sarvesh Chaturvedi Management Associate (Operations) Satin Creditcare Network Limited
Microfinance-Operation And Challenges During Covid Introduction Keeping in mind that Lakshya focuses on the operation, I have decided to share insight on how the microfinance organization operate and the challenges that covid has posed to the whole micro finance sector. Before we get to know the operational challenge, lets first start with an understanding of Micro finance. Microfinance Microfinance has been present in India for a very long time in informal formats such informal money lending, chit-funds or rotating savings, etc. Microfinance sector is a sub-stream of Finance sector. It covers a lot of services such as, pension plans, cheques and fund transfers for the economically challenged segment of the country. Those people who were traditionally not provided access to financial services through banks mostly because of lack of collateral, but such segment of people can have these services with the help of microfinance institution.
Further there are various model on which microfinance institution works. In the Self-help group (SHG model) model there are selfgoverning social bodies consisting of 10 to 20 members which mobilize a fund through its members or from a bank; They advance loans to its members or others keeping in mind their requirements after taking the united opinion of the group. The non for profit and the government organization like NABARD follow this model. Joint liability group (JLG model) In this model, there is a collective dependability. Centers are formed with the help of groups and the group formation is with the help of members. 5-8 members per group and 4-5 groups per center constitute the most preferential grouping. The number of groups per center varies from MFI to MFI. Operation cycle and the covid Crises
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There is a lot of operation infrastructure that goes behind a successful operation in the MFI sector. To talk specifically about for-profit MFI’s. In a layman’s language the process goes like, first there is a center formation, the clients are shared about the loan disbursement process, the repayment process, the importance of punctuality during the repayment. Once the loan is disbursed after proper client verification by the field staff/Loan officer of the MFI. Further there is a meeting for payment of installment that is scheduled every fortnight or in a month that varies for different MFI’s. From the operation point of view, it is very important that the whole process runs smoothly. The operations team ensure that at every point the focus is on increasing the efficiency in the performance of the team as a whole. In India, Covid crises has posed lot of challenges to the MFI’s. Most if not all of the clients of MFIs have been impacted by the COVID crisis, directly or
indirectly. The direct impacts were due to the mandatory or self-imposed closures of business activities or own decisions to temporarily discontinue their businesses for personal reasons such as health risks or family situation. The indirect impacts include the consequences of the compulsory lockdown in the country due to the COVID pandemic which caused the disruption of the supply chains and decreased the demand for certain products and services offered by the microfinance clients. This eventually impacted the loan repayment cycle as well. This led to most of the MFI’s incurring losses in the quarter following the lockdown in the country. Further in India as thing resuming back after the peak of first wave of Covid, the microfinance sector has also shown an improvement in the overall loan portfolio. Moreover, the second wave of Covid is where the MFI sector will use their experience of tackling the situation during the first wave of covid.
About the Author: Mr. Sarvesh Chaturvedi Sarvesh Chaturvedi is an MBA-Rural Management graduate (2018-2020 batch), from Xavier Institute of Management Bhubaneswar (XIMB). Currently he is working as management associate in the operations department at Satin Creditcare Network Limited (SCNL). He has worked as an research intern at UNDP on a project to provide intervention to the problem of tribal community in Dhar district, Madhya Pradesh, India. His Interest areas: Operations, Supply change management, Rural Development, Water Resource and Skill Development, community mobilization and capacity building.
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Corporate Angle Mr. Jai Ajmera Deputy Manager, M&A – Transaction Service Department, Deloitte Touche Tohmatsu India LLP,Mumbai.
Understanding Expected Returns In The Impact Investing Sector Valuation Perspectives Social investment is a broad spectrum ranging from pure profit-driven investing with some expectations of social impact to pure philanthropic grants. Broadly, social investments include Corporate Social Responsibility (CSR) expenditure, Socially Responsible Investing (SRI), and Impact Investments (II). While CSR expenditure is incurred without the expectation of financial returns, SRIs seek to minimise negative social impact. However, impact investing differs from SRIs and CSR in that it is made with the intention to generate positive and measurable social and environmental impact alongside a financial return. Impact investors also focus on investing in social enterprises that do not merely mitigate negative impact on the social front but also generate net positive impact, both from a social and a financial perspective. • A large number of funds mentioned above are incorporated and structured as private-equity, venture-debt, or venture capital funds, albeit with a greater emphasis on investment in companies involved in social development or causes. Several of these funds are also backed by LPs
who, while largely driven by the societal impact of their charitable corpus, are not disinclined from the financial returns that impact investments can generate particularly from scalable sectors in India. This is also evidenced in several exits that have driven substantial returns for investors from companies in largely social impact ventures. An analysis of actual returns from Impact Investments over a specified time period revealed the following: • Based on a study performed by Mc Kinsey & Co., the median Internal Rate of Return (IRR) on Impact Investment exits in India was 10 percent, which was higher than the risk-free rate in India by 300 basis points. These returns however, were lower than the market returns over the same period. A significant challenge, particularly when valuing impact investments using an income or cash flow-based approach, is determining an appropriate discount rate. Normally, the discount
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rate used in the valuation of a business not listed or publicly traded represents the return that a market participant would expect from an investment in a similar business. Such expected return is normally derived from the Capital Asset Pricing Model (CAPM) that takes into consideration the current market return, adjusted for company-specific factors as well as the business’ own cost of debt, representing a weighted average cost of capital. However, considering that such market returns and, therefore the expected returns derived from the CAPM, are representative of returns investors would expect from companies and businesses whose sole aim could be to maximise shareholder wealth through profitability and cash flows, these returns may not be representative of returns Impact Investors would expect from their investments, keeping in mind the socio-financial objectives of the enterprises. In addition, impact investments can be categorised into three types based on their purpose, social scale, and business model, each with a varying degree of trade-off between achievement of social objectives and financial return. To assess the expected return from an impact investment, we believe the key considerations include the specific expectations of the providers of finance and their categorisation of the investment – as commercial, sub-commercial, or grants. Commercial Investments: Certain businesses have the ability to generate positive cash flows from continued operations despite having a large emphasis on social impact. In fact, these businesses may be largely structured and incorporated as body corporates or limited liability partnerships with a for-profit purpose. Impact investments in these businesses may or may not be alongside socially neutral commercial investors such as private equity, venture capital, or high net-worth
investors. The requirement for impact investments in these businesses may arise from the absent or insufficient commercial investments due to a lack of familiarity with the given geography or sector or a lack of scalability that could result in higher returns for a regular financial investor. Common sectors where such businesses exist could be agri-tech, fin-tech, health-tech, microfinance, education, and allied sectors that focus on the rural or agrarian regions but with monetisable and scalable busines models. Quasi-commercial investments: Certain businesses have the potential for social and market impact as well as a proven business model. Such businesses would have been originally envisaged as being incorporated purely for a social cause but may have the ability to generate positive cash flows and profitability, albeit slightly lower than businesses with a primarily commercial objective. On several occasions, these businesses may be funded by government or private grants or donations from charitable or development finance institutions (DFI) whose primary objective is to drive social impact over financial return. However, considering such business’ ability to generate positive cash flows and profitability, such businesses would be attractive investment platforms for impact investors seeking to generate a blend of social and financial returns. In such cases, lower financial returns may be accepted with cognisance to the potential for social impact. Common sectors for such investments include agri-distribution, rural healthcare, priority lending (including microfinance), innovative education platforms, and the like. Grants and charitable donations:
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It is common for grants and charitable donations to be made to businesses/organisations whose primary purpose is to generate the maximum social impact without any emphasis on financial gains. In quasicommercial investments, grants and charitable donations are primarily made to cover costs in the initial stage of a business, which is expected to
become financially sustainable over the long term. Grants and donations from charitable institutions or DFIs are primarily provided without a rider for repayment or periodic interest contributions or the option to participate in equity at a later stage. Essentially, from a purely financial perspective, they may be considered as zero-cost equity.
About the Author Mr. Jai Ajmera Qualified Chartered Accountant from The Institute of Chartered Accountants of India with 6.5 years of Audit experience (Including internship) at Price Waterhouse Coopers, Mumbai. Currently working as Deputy Manager with Deloitte Touche Tohmatsu India LLP, Mumbai in M&A – Transaction service department. Performed 7 financial due diligence within a span of 2 years for Companies in varied Industries like electrical motors, dairy, retail, construction, granite, metal etc. ALso worked as Field-in-charge and have performed audit in Industries ranging from manufacturing, service, media, engineering, non-profit organization (section 8 companies) etc.
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Emerging Managers
Mr. Manav Marwaha MBA-22, IBS Pune.
BYJU’S – The Unsurpassed Unicorn. Byju’s – the learning App is an EdTech platform created by Byju Raveendran under the banner of Think and Learn Pvt Ltd in 2011. It is a platform for teachers to teach and students to learn different educational concepts through the app and understand them better. The main objective of Byju’s is to tap the potential of the Indian education market and to help the students fall in love with what they learn. The major factor that contributes towards the success of Byju’s is its freemium business model, where communication is done from business to consumer and personalized experience is provided to the user by using knowledge graph feature and can proceed at their own pace. This helps Byju’s conquer the education market in India and now it has across 64 million registered students out of which 20 million students have added post lockdown and it has 4.2 million annual paid subscriptions. Byju’s Raveendran has foreseen the potential of the Indian education market where around 70 million students go for private tuitions and the overall
student base is around 320 million and he has developed the app to tap this market. This was one of the factors that helped Byju to raise funds in the national as well as international market. In the latest fundraising rounds during the lockdown, Byju’s has raised around $500 million from private equity giant Silver Lake at a valuation of $10.8 billion. This has led Byju to be the second most valuable start-up in India after Paytm ($16 billion). Earlier this year Bangalorebased start-up had also raised funds from tiger global and general Atlantic which amounts to be between $300 and $350 million. Under the new National Education Policy 2020 proposed by the government, skills like coding will be added to the curriculum starting from class 6. So Byju’s has taken this into account as part of their future expansion plans and this has led the nine-year old start-up to acquire WhiteHat Jr., a Mumbai-based coding platform in a $300 million all cash deal.
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Now after the acquisition of WhiteHat Jr., Byju’s has indicated the future plans to expand its market to the US, UK and Africa and is already present in the middle east. After this growth potential is shown, how can investors not fall in love with Byju’s.
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x
Emerging Managers
Mr. Navdeep MBA-22, NITIE, Mumbai
From No Mobility To Future Mobility: Where Covid-19 Has Accelerated Change
The COVID-19 pandemic has disrupted mobility, and its effects will linger well into next year. How will changing consumer preferences, technologies, and regulations shape the market in 2021? COVID-19 swept across the globe in a matter of months, jeopardizing lives, upending businesses, and setting off a worldwide economic slump. Consumers are intensely focused on health and have altered many long-standing habits and preferences to avoid infection. Within the mobility sector, this means that many passengers favor transport modes perceived as safer and more hygienic. Suddenly, private cars are in and shared rides seem to be out. Working from home is on the rise, again with the goal of preserving safety, while business travel and all the mobility services attached to it—flying, taxis, e-hailing—are in low demand. The best-laid plans of mobility players appear to be in tatters. It may seem that the acceleration of future mobility has come to a halt, but this first impression overlooks recent developments that will have a tremendous impact on mobility’s future.
Cities have redefined car lanes to create more space for bikes and scooters as people began to avoid public transportation. Similarly, government incentives to help the automotive industry have encouraged the use of carbonneutral solutions and stimulated the development of electric vehicles (EVs). In another shift arising from the pandemic, consumers are increasingly turning to digital channels—from convenient food deliveries to streaming services—and they now expect mobility players to expand their online offerings. Such fundamental changes, along with other recent developments, are prompting mobility leaders to reimagine the future of mobility. They had already been adjusting their strategies to the emergence of ACES—autonomous driving, connected cars, electrified vehicles, and shared mobility—and now they are going even further to account for the pandemic’s impact on consumer behavior, policy making, and regional economies. The following shifts are likely to
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persist long after COVID-19 is controlled and thus deserve particular attention: •
•
•
Customer preferences. In addition to safety, consumers are becoming more focused on digital channels and sustainability issues. Access to micromobility options—lightweight vehicles such as bicycles, e-scooters, and mopeds—will be important, as will safety and health issues. Technology. The pace of change will continue to accelerate in all areas, including connectivity, autonomous driving, and urban transport. Regulations. We expect regulators to become even more active within the mobility sphere. Many, for instance, are tightening CO regulations for vehicles as they attempt to reduce climate change. 2
In addition to safety, consumers are becoming more focused on digital channels and sustainability issues. Access to micromobility options—lightweight vehicles such as bicycles, e-scooters, and mopeds— will be important. Consumer preferences Many car dealerships closed in 2020, and car buying plummeted, especially early in the year. In February, sales were down 71 percent in China; in April, they decreased by 80 percent in Europe and 47 percent in the United States. Likewise, mobility behavior changed drastically during the pandemic, as many commuters worked from home and others avoided public transportation because of health concerns. While consumers have traditionally focused on time to destination, cost, and convenience when selecting a transport mode, they now cite the ability to reduce the risk of infection as their major consideration n a related trend, transport modes that are considered safe have become more popular. With consumers focused on avoiding infection, mobility service providers quickly implemented a range of safety improvements. These changes will persist, and
providers may soon add other safety measures that span the entire customer journey. Changing consumer preferences may give private-car use the greatest boost, but micromobility options and walking/biking are also expected to gain ground. The growing importance of online channels In addition to exploring new products and mobility options, consumers are interested in new services. This shift is clearly apparent in automotive retailing, where a future beyond bricks and mortar is emerging. Although consumers still rank dealership visits as the top factor influencing purchase decisions, digital channels are becoming more important. In a recent survey, more than 80 percent of respondents used online channels during the purchase-consideration period, and more than 60 percent said it would be appealing or very appealing to have digital channels for booking, paying, and reviewing additional services Technology Although many mobility players focused on responding to COVID-19 in 2020, they continued to invest in ACES. Funding such innovations has always been challenging given the high costs, and the pandemic has exacerbated this issue because traditional OEMs have undertaken cashpreserving measures and cost-cutting initiatives that leave little room for technology investments. OEMs and suppliers may mitigate some funding issues by undertaking partnerships with other companies. Even before COVID-19 hit, many companies were investing in these ventures, with the number of ACES partnerships increasing 40fold over the past decade. With COVID-19 putting budgets under pressure at OEMs and suppliers, these partnerships will become even more essential.
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Impact of regulations on infrastructure Government planners are constantly making mobility decisions, since they must design car lanes, pedestrian walkways, EV-charging infrastructure, and much more. Since the pandemic, city leaders have been especially active in making infrastructure changes that affect mobility. Consider a few recent examples: •
•
Milan announced it will transform 35 km (about 22 miles) of streets previously used by cars to walking and cycling lanes. Paris will devote 50 km (30 miles) of lanes usually reserved for cars to bicycles; it also plans to invest $325 million to update its bicycle network.
The outlook for 2021 and beyond Certainly, no one could have imagined how the world would change in 2020. Next year will also bring much uncertainty, but one thing is definite: mobility will continue to evolve in exciting ways. Here are the major developments we expect: Expanded consumer preferences and a greater focus on sustainability
When the COVID-19 pandemic is controlled— it’s to be hoped at some point in 2021— consumers will be more willing to use public transport and other forms of shared mobility. We expect that sustainability will continue to be an important consideration, with more consumers opting for electric and micromobility solutions, especially in cities. Car sales may continue to decline from their 2019 peak, as more consumers consider alternatives to car ownership. Continued technology disruptions and widely available innovations Automotive technology will continue to evolve in 2021, and consumers will have greater access to innovations. For instance, 60 percent of premium OEMs plan to have some form of level 4 automation in their vehicles by 2025. Vehicle electrification will also continue, and innovations could drive EV costs down even further. (The total cost of ownership for BEVs has already reached parity with ICE vehicles in the Csegment.) For technology overall, we expect that software will increasingly become the key differentiator for vehicles.
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Emerging Managers
Ms. Sonal Chundawat MBA, IIM Sambhalpur.
Operations V/S Marketing: See-Saw Couple Operations and marketing people behave as if they're a husband and wife in front of a divorce counsellor, seated at opposite ends of a table. Act as if a lawyer has asked them to prove who is to blame for the marriage's demise, and that the lawyer has given them a year to figure it out so that they can eventually coexist. In every company, disputes between operations and marketing teams have been witnessed by everyone; it's a daily task. But when the goal is to hit the targets, these two have to work in alignment. The harsh reality is that marketing and operations have radically different viewpoints and behaviour towards each stage of the product lifecycle. Marketing professionals are often focused on revenue, nurturing existing clients, and attracting new ones. In contrast, Operations professionals are often focused on lowering operating costs, optimizing cost efficiency in distribution, inventory, or any other ongoing business operations. Neither feature pays much attention to the customer's perception of value. As a result, there is always
friction, and organizational rewards alone will not fix the issue. The majority of the disagreements stem from the marketing team's commitments to the customer for some products and services shortly. Knowing operations had almost no flexibility in adjusting long-term production planning to account for short-term shifts in demand factors. These types of changes in production planning are detrimental to the organization as a whole. Marketing people often have one thing in mind: a diverse product line with various products, whereas operations personnel prefer a uniform product line. It's challenging to maintain high quality when delivering a wide range of products in a short time. These rushed deadlines may result in poor quality, numerous system failures, time waste, and customer dissatisfaction. More variety means more inventory, more workforce, more time, costlier setups, more planning, and more training from an operations standpoint. Afraid of quality standards and more occurring errors, they
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resist the breadth of the product line claimed by marketing people reason of low sales volume. Operations personnel do not include marketing personnel in production planning; since marketing people work closely with customers, it's difficult for them to create accurate forecasts in advance. It's also an observation that towards the end of the year, in order to hit revenue targets, marketing staff proposes giving big discounts on goods, and then meeting sales targets, which operations personnel dislike because they implement production schedules and effectively handle costs during the year, and at the end of the year, the company's profit is inflated due to hefty discounts. Information about seasonal sales and festive discounts, such as quantity requirements, marketing strategy and the operations team's versatility, have not been properly addressed between the teams. Fights escalate when there is a discussion of the cost base of the production of goods/services. Since marketing and operations, workers have opposing viewpoints. Costs are seen as a barrier in marketing when offering the best deals to the company's customers. From the view of operations, higher prices result from marketing's irrational commitments to consumers to provide a wide range of goods, quick delivery times, better quality, and new products. The prospect of marketing releasing a new product every time is deemed unreasonable by the operations team. New systems and processes, new skills, and staff to manage these processes are needed to push for continuous new product developments and quality improvements. But marketing says innovations are required for business growth and survival in a competitive market. However, these daily demands put a lot of pressure on manufacturing, which leads to disagreements.
Marketing is a creative team, while operations is a data-driven group. When marketing professionals make a decision, they come up with an innovative approach, but they overlook the analytical aspect. The situation is reversed for operations personnel, who make decisions solely on the basis of analysis and lack the imagination to provide more. On a regular basis, marketing people deal with consumer dynamics, competitor tactics, innovative innovations, commercials, and a variety of other things, and based on their assessments, they have solutions to improve revenue, but the operations team actually ignores the reason as their agility is very low. Marketing and operations are considered the backbone of every business, and they typically have the most control over decision-making. Marketing is the company's front-end team, whereas operations are the back-end of the company. Since both departments are interdependent by design, the best practice for resolving such frictions is to keep them integrated. The dispute can be beneficial if it is appropriately handled to generate a pull of goods from manufacturing facilities to the market by pushing plants to their whole production levels. To drive volumes and profitability, only the marketing team needs to assist operations with cost management, distribution schedules, and capacity utilization. If this integration doesn't work, the conflict will spiral out of control, resulting in inventory build-up in the supply chain as predictions fail to convert to sales orders. Inventory build-up is an operations manager's worst nightmare. If all partners accept the pressures and responsibilities of each other, their marriage will run smoothly. Cooperation and coordination are what they need. Mistrust happens when there are no clear lines of communication,
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and it grows over time, particularly in the case of long projects.
accomplish the same goal, profits and revenue graphs can improve dramatically.
Knowing and respecting each other's limitations, listening to different perspectives, being able to configure and analyse the consequences, suggesting a wise course of action, being able to comply with policies, and being transparent can all be beneficial remedies for a happy marriage. Management will only benefit to a certain degree by establishing strategies and offering rewards, but the boat can only be saved by those who are sailing in it, just as when all teams work together to
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Emerging Managers
Ms. Tulika Shukla Masters of Engineering Management, Dec 2021, University of Ottawa, Canada.
Pause We are always running a race, a race to do everything, working crazy hours to achieve everything but we tend to ignore the inherent pressure that comes due to overwhelming goals we set for ourselves. There is a lot of burnout, exertion and mental pressure. We still keep pushing ourselves to do more each day, which of course is a good thing but we need to draw a line where it starts taking a toll on our mental and physical health. We have grown in a society where if you have a fever, you will be given a paracetamol tablet immediately or if you broke a limb, you will receive the first aid to address that emergency. But if you say to 'I feel stressed out', you are most likely to receive a reply 'It will be alright'. It is not treated as seriously an issue as it is. We need to address that. We need to create the urgency. When was the last time you did something, you love? When was the last time you heard yourself breathe, you felt alive? Sometimes it is all philosophical and not all practical, but we need to understand the importance
of it. Personally, if I compare the happiness between receiving a salary credit message and taking a good independent run or maybe comparing the excitement in getting a job and a virtual date, I will say I feel happier in the latter. I do not say earning money is not important or it does not give me satisfaction, but there are more things as well which are important and we often ignore. Getting the best job to your best potential is very important, but jeopardizing your mental well-being for that is an absolute no-no. We need to accept the fact that it's okay to slow down. You don’t have to match your pace with others, you have to be the best version of yourself for yourself and your loved ones but not for the world and this comprises of being happy and content rather than just successful and rich. Acknowledge your feelings, take signs from your body and accept that what you are feeling is real however, it should not be confused with working hard. Working hard is paramount, but compromising mental fitness is not worth it.
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It’s not easy to talk about these things, it’s really difficult to open about your vulnerabilities, but there will be at least one person in your life who will understand you, no matter what. There will be one person who you can yell at, be irrational, of course, don’t start taking them for granted, just acknowledge and appreciate, even apologize later. It could be anyone, your mother, father, brother, sister a friend or your partner. Be real with at least one person, it is okay to be masqueraded with everyone else. Not everyone will understand, not everyone needs to understand. Sometimes it wouldn’t be that easy, it will never be a straight line, but you will get through it. We are conditioned in a way since childhood that 'don't be a quitter', but you know what, it is okay to quit. Life is too short to keep doing things that you hate. It is not about money, everyone finds a way to make money, some a little less from some others but we all do. Quitting is not a crime, be bold enough to accept that you don't like something. How is it so easy for us to stop talking to people we don't like or stop eating food we don't like but so hard to stop doing what we don't like. It is because of the judgment we all are afraid of. 'Oh, she quit because she was not good at Mathematics', 'Oh he doesn't even know English', 'She is a mess, she does not
keep her house clean' and thousands and thousands of them. We let our judgemental society, family, friends and colleagues decide what we want to do and what we don't. It is important to know that there are millions of skills in the world, and one cannot excel in all of them so it is okay to explore all those that suit you and quit all those that do not. It is as simple as that, we just tend to complex things due to some external forces. Our minds and feelings are quite simple, it is us humans who complicate things. Do you miss someone? Pick up a phone and call them. Feel bad for anything you did in the past? Apologize. Love someone? Let them know. Were you too mature for your age? Grow backward be a child, be carefree, easier said than done but we can at least start. No one knows your circumstances, but you do. You can. It is as simple as that. Life is too short to regret. I learned this the hard way, how uncertain life can be, but it is true. Even if one situation or one line in the article resonates with you and can make you feel a little better, I feel accomplished. So just Pause! Write your own story!
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Emerging Managers
Mr. Meet Garala MBA, Batch 2020-2022, NITIE.
Supply Chain Resiliency And The Need For Stress Tests What is supply chain resiliency? Supply chain resilience is a supply chain's ability to be prepared for unexpected risk events. If you have a resilient supply chain, you can manage to respond and recover quickly to these disruptions by returning to the original situation or by moving to a new, more desirable state in order to increase customer service, market share and financial performance. Ways to create resilient supply chains Digitalization: Digitalization for supply chains is enabling transparency across the entire value chain. This means visibility all the way from product origin to the customer and product lifecycle. Alongside this data, the use of artificial intelligence is allowing businesses to spot relevant patterns and adopt a more proactive approach to managing risk. Diversification and Collaboration: For smaller and medium sized enterprises, whose adoption of digitalization and Industry 4.0 technologies is likely to be slower and phased, there are still plenty of sound ways to improve supply chain resilience. A
sensible strategy would be to diversify supply, both in terms of company and location. Why are stress tests in a supply chain required? An effective way to increase supply-chain resilience is to understand the impact a crisis could have. Maintaining the delicate balance between supply chains’ costs and risks requires companies to be vigilant. A stress-test quantifies the supply chain resiliency. Additionally, the test will assess the full supplier network, including suppliers in Tier 2 and beyond. The COVID-19 pandemic has raised the topic of supply-chain resilience and rebalancing to boardroom level. Even brief, 30-day disruptions caused by supply-chain vulnerabilities can result in 3 to 5 percent EBITDA margin gaps. As companies look for ways to reduce their exposure to supply-chain risks, it is estimated that up to $1 trillion in trade flows in the industrial sector could be rebalanced, and a few countries have the potential to become major destinations of relocated production. Furthermore, advances in technology—and the large-scale adoption of
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automation and digitization—have reduced the focus on labor cost, further increasing the need for companies to test their supply chains holistically for cost, speed, and risk. A comprehensive supply-chain stress test assesses resilience holistically across five factors: industry attractiveness, corporate resilience, supply-chain exposure, operations exposure and customer exposure. This will allow comparison to competitors, as well as across business units. Industry attractiveness: How well does your industry create economic profit and perform on cash conversion comparing to other sectors? Customer: What part of your customer base could be at high risk when major disruption occurs? • • •
How concentrated is your revenue across top customers? How financially resilient are your customers? How concentrated are your sales by region?
Operations: What parts of the internal operations could be severely disrupted in the face of major disruptions? How localized is your production? How labor-intensive are your production sites? Corporate resilience: How well does the company perform on EBITDA margin and cashconversion cycle compared to peers? Global Supply Chain: What parts of the supply chain could be at high risk when major disruption occurs? • • •
Where does specialization inthe supply chain create vulnerability? To what extent is the supply chain highly exposed in certain regions? Where is there risk among Tier 2 (and beyond) suppliers that may not be immediately visible? How deep and interconnected are the suppliers?
•
How reliable is the supply chain and how well-positioned is the company to endure the next disruption?
Where the stress test reveals potential vulnerabilities in the supply chain, companies can identify appropriate mitigation steps. This calls for a combination of short- and medium- or longterm actions that are tailored to the specific issues that have been identified. Short-term no-regret actions might include increasing safety stocks of vulnerable parts, changes to contract terms to ensure the financial security of key partners, or investing in new skills and capabilities, such as the adoption of digital tools to improve supply-chain visibility and provide early warning of potential problems. Medium- and long-term actions might include diversification of the supply base; location diversification and vertical integration to reduce reliance on single suppliers; or automation and digitization in manufacturing to increase production agility. Companies can also consider changes to product designs to optimize complexity or reduce dependence on specialized components with limited availability. Benefits of a resilient supply chain Availability: The first benefit of a resilient supply chain is availability. With quality operating systems, you can access real time inventory data and adapt to global constraints. This gives you and your suppliers peace of mind during unexpected weather-related events and catastrophes. Even if one location gets hit with a blackout, you can still access the latest information on your system elsewhere at the click of a button. Flexibility and Configuration: Unexpected disasters do occur, and your business needs to be able to respond to these challenges. Using cloudbased software, you can be ready for anything
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with original configurations from any device, without needing to set up a new system. More Control: Total control in your business means knowing and seeing exactly where your inventory is at any time. By obtaining cloud-based software and working with a third-party logistics provider, you can have a single view of your inventory across your entire network. This visibility gives you more control over your business.
cost centre to a source of competitive advantage that unlocks operational margins. They must embrace connected planning with procurement and finance, making supply chain recommendations based on P&L outcomes that maximize working capital. It is time for supply chains to go on the offense to drive out complexity, harmonize plans and build agility.
What is the future of supply chain resilience? Whatever the future looks like, supply chains must seize this opportunity to move from executors and a
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Emerging Managers
Mr. Khushboo Vats MBA, Batch 2020-2022, IIM Jammu, India.
The Time Banks
Lately, we have overheard a lot about alternative currencies, cryptocurrencies to be precise. We are waiting for how the Government reacts to it with their forthcoming Cryptocurrency Regulation Bill, 2021. In the meantime, we can talk about a not-sofamous social currency: time-based currency. I came across this notion back in 2018. We can only picture exchanging our services for money because that's what we have seen in our society. But this community has been discovering alternatives to regular cash. There was a group of people trying to form a time-based currency system to replace the standard monetary system completely. Whether this model would work out or not is yet to be seen, but the idea itself is unique. Why did they come into existence? With the world advancing, individuals are getting separated from institutions. We exist in small families, working from the comfort of our homes in these covid times. The way the world is advancing, it is also concentrating on specialization. Individuals have restricted skill sets. We are good in our field of
work but lack even the basic skills like money management, tax filing, etc. And even if we are aware of these, we don't have the required time. The shortage of time, limited skill sets, and advancement of the world have led to the formation of Time Banks. What do they do? Time banking is a network of people utilizing their time, instead of money, as currency to exchange services. In these systems, one person offers to work for an hour for another person, by earning a credit equal to one hour, which they can redeem for an hour of service from any other volunteer. Services could be in any form- social work or any monetary work. One prominent example is from Japan- The world's first Timebank was started in 1973, Japan by Teruko Mizushima with the idea that members could earn time credits that they could spend during their lives. There are
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many timebanks for older people, where senior citizens can trade services for free, right from tax filing to companionship. The time bank currently benefits the 2 million elderly in Osaka city who require only immediate help, which is sufficient for them to live freely in their own homes rather than moving to care homes. In India, the Happiness Department of Madhya Pradesh has recently set up a time bank. Whenever a bank member requires a service or wants to earn a skill, they can exchange a credit, worth an hour, with another member knowing the same work. This is an amazing way to learn new skills, socialize and
contribute to society. The basic idea behind time banks is profoundly impartial, both because everybody's time is treated similarly and because everyone starts out with the equal amount of it. No matter how rich one is in terms of money, it is not possible to buy any time. Only if we thought of using our time in such beautiful ways, we could presumably substitute the cash-based transactions with time-banks, not entirely, but at least partly.
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Emerging Managers
Ms. Rishika Nigam MBA, Batch 2020 – 2022, IBS Hyderabad
Operations In Healthcare Operations management in healthcare involves managing all activities formed to monitor and manage the various processes that exist to drive the services rendered, such as funding, staff, legislation, and facilities. These initiatives include quality assurance, care management, staff testing, and licensure, credentialing, tracking health benefits and related claims risks, managing medical assessment, regulatory, auditing, and compliance programs, among others. The COVID-19 pandemic has resulted in severe shortages of personal protective equipment (PPE), ventilators, and possible therapeutic medications, limiting our ability to fight the pandemic. A variety of factors contribute to these scarcity situations. To begin, several healthcare providers have implemented vendor-controlled inventory systems focused on just-in-time delivery to improve supply chain performance. In most cases, this quality reduces surplus supply inventory and extraneous costs. However, due to minimal inventory in the supply chain, this model has not met the current increase in demand. Suppliers who usually produce
in response to predictable demand trends are now under pressure. Suppliers that usually manufacture on a consistent demand schedule are now scrambling to adjust supply to meet the increase in demand. To prevent essential supply shortages, healthcare facilities will need to reconsider their inventory management plans, which are oriented toward cost efficiency. The global existence of the medical supply industry is another factor leading to current shortages. To alleviate and avoid potential shortages of vital products, the medical supply industry must reconsider the nature of global supply chains and implement more efficient risk reduction strategies. Furthermore, the bullwhip effect, a phenomenon in which a small shock in customer demand results in substantially larger demand shocks upstream in the supply chain, is a major contributor to shortages. Inflationary ordering behavior because of limited supply is one of the factors driving the bullwhip effect. For restricted supplies such as PPEs and ventilators, the optimal
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allocation approach should be based on relative demand rather than demanded amounts. Hospitals around the country are presumably placing larger orders based on perceived supply chain problems and projected future demand. This form of order is precisely the mechanism underlying the "bullwhip effect," which causes delays. This type of order is precisely the mechanism behind the “bullwhip effect” and leads to delays and inefficiencies from manufacturers as well as limited access in areas with the greatest need. As hospitals and health systems continue to grapple with the COVID-19 problems, the availability of beds and clinical personnel remains important. Agility, connectivity, and technology are critical for rapidly adapting to an influx in patients, and services are dependent on workforce and capacity management resources built into the electronic health record to meet exceptional demands. These solutions will aid in resource allocation, increasing efficiencies, and ensuring a healthy work
environment. Overall, operations managers will provide oversight and guidance in a disjoint setting by putting disparate data together and advocating for better practices, which benefits both the health department and its patients. Furthermore, according to the rating agency, the availability of free drugs in public healthcare facilities has declined over the last two decades, from 31.2 percent to 8.9 percent for inpatient treatment and from 17.8 percent to 5.9 percent for outpatient care, citing a Public Health Foundation of India survey. It also reported that the government's push for universal health coverage would fuel growth in India's pharmaceutical and healthcare markets. According to the report, an improving business environment and planned healthcare reforms would favour innovative drug makers, and the sector will continue to hold significant potential as the Asia-Pacific region's third-largest pharmaceutical market.
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Emerging Managers Mr. Kunal Sharma MBA, Batch 2020-2022, IBS Hyderabad.
Operations Management in Banking Sector OPERATIONS MANAGEMENT IN BANKING SECTOR Banking operations confirm our process and transactions are executed correctly, which minimizing risk and maximizing quality of services. These jobs in the middle and back-office teams of all our business unit. IMPORTANCE & CONTRIBUTION OF OPERATIONS MANAGEMENT IN BANKING SECTOR: •
•
Banking was once conducted with the bank within the neighborhood. Today, massive bank corporations span the country. Consolidation of resources in the banking industry has permitted quick technological growth. Banks now have debit cards and ATMs in almost every location. What’s more, banking on the Internet is growing. Virtual banks (that is banks that exist only within the computer—with no large buildings and land) are appearing on the Web. Many small ones are finding the competition an excessive amount of, however, and are closing their doors.
• The
operations manager in banking is liable for offering services to clients and the bank. It is difficult job with changing markets and transformation to new technologies and items & products. Three major areas employ operations managers. One area is that the back-room operations that the general public never sees where people and systems are processing the knowledge and transactions of the bank and its customers. A second area is the branch bank manager. The individual not only deals with the branch but also sells services and supports client needs. At last, senior executives in sales and support areas such as finance, accounting, law, and other areas are also operations managers who manage the efforts of their employees. • Operations management in banking is people intensive. The innovation of the bank framework adds to the challenge. The functions performed by the operations manager include forecasting work volumes; setting staff and equipment levels to satisfy that volume; resolving quality and service issues; identifying new technologies that can improve services and lower costs; working with customers both inside and out of the bank
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to work out ways to raised meet their needs; and developing staff in order that they will progress in their careers. A major challenge to the operations managers in banking is the need to be able to understand not only how to do their own job but also how to use new technology to do it better. Computers and computer programs are within the forefront on this technology that’s driving changes within the industry. The operations manager who can deal with both areas is the Manager who is going to rise to the policy-maker position and set the future direction for others.
•
Quality Tracking Process that ensures customers receive products barren of defects which also meet their needs.
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Capacity Planning
OPERATION MANAGEMENT TECHNIQUES USED IN BANKS:
•
•
•
A support tool with a tree-like structure that models probable outcomes, cost of resources, utilities, and possible consequences.
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Sequencing
•
Process which covers several different ways of finding out how long a job or part of a job should take to complete.
Quality Analysis Process through which a business seeks to make sure that product quality is maintained or improved.
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Fishbone Analysis A cause-and-effect diagram that helps managers to trace down the explanations for imperfections, variations, defects, or failures.
Workforce Analysis
Work Measurement
Setting Performance Standards A comparison point when they review employee performance.
Break Even Analysis
Process that uses both employee and ROI data to tell decisions on (1) recruitment, (2) retention, and (3) employee management. •
Decision Trees
To design the order of the operation by process.
An estimation of the approximate sales volume needed to only cover costs, underneath which production would be unprofitable and above which it might be profitable. •
•
Forecasting It’s a way that uses historical data as inputs to form informed estimates that are predictive in determining the direction of future trends. Organizations use forecasting to determine how to distribute their financial plans or budgets for expected expenses for a forthcoming timeframe.
•
Process of deciding the production capacity required by an corporation to satisfy changing demands for its products.
ROLE OF OPERATIONS DEPARTMENT IN BANKS: Operations in banking carry out all the day to day transactions of the bank. Operations are involved as follows: • •
processing of bank instruments payments of all receipts on demand
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• • • • •
credit of lodgments of proceeds on customer’s account processing of domestic and foreign fund transfer closing of account on customer’s request acceptance of valuables of customers proper recording of documents from the varied transactions of the bank, etc.
Operations within the banking sector may be a department put aside to tackle and render direct and indirect services of the bank to its numerous customers. CONCLUSION: Operations Management are very useful in any organization being it manufacturing, trading or service. It yields very positive results due to the optimum utilization of resources in an efficient and
effective manner. It is often seen that the organizations who rigidly practice Operations Management in their work place have surely grown big and prospered by leaps and bounds thus paving the way for others to follow them. Differentiation is that name of the game to achieve in a market where most goods and services are commoditized. TQM, Strategic Management Supply Chain Management all tend to be useless without effective operations management. Commitment Compliance effective systems and controls become meaningless terms less important without proper operations management. Ultimately, success is within the hands of the ability to plan, coordinate, control and control by effective managers at a day to date level.
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Emerging Managers Mr. Abhay Shukla MBA, Batch 2020-2022, IBS Hyderabad.
Statistical Process Control Statistical process control It is a quality control method that utilizes statistical methods/ tools (The design of experiments, control charts, Ishikawa Diagram, and so on.) to monitor and control a process in the Manufacturing Industry. SPC ensures that process flow is smooth and the scraps and the defects in process and products are removed. Why it is used A lot of manufacturing companies now-a-days are facing an increase in competition and the raw materials costs are also increasing and taking a look at the current scenarios the prices increased by a lot in last six months which has led to increase in manufacturing cost of the products. This one of the factors which is out of the manufacturer's control for the cost reduction. Therefore, the manufactures must focus on the areas where they can reduce the production cost. This where the SPC process comes into play, the process is implemented to change the ideology from detection-based to prevention-based. By monitoring the performance of a process over a
duration of time the operator of a machine can detect the changes in process or defects in the machine and removed the defects before they result in defective or unsatisfactory products which would eventually end up in scrap. How it is implemented In the initial stage before the implementation of the Statistical process control the organization should find out the area where main areas where the wastage is occurring. Some of the major areas are where wastage is occurring are the areas where scrap, rework, or excessive inspection time is taking place. To find out these areas some tools are used one of the most popular tools used is DFMEA OR DESIGN FAILURE MODE AND EFFECT ANALYSIS. DESIGN FAILURE MODE AND EFFECT ANALYSIS (DFMEA) – It is a tool that is used to identify the potential risks in a process. It finds out the critical areas and the points outs the situation where a potential failure can happen and
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grades them based on their severity. The higher the severity the higher the probability a failure would occur. Severity is ranked from 1 to 10. Below is an example of factors how the severity of a process is being marked –
or the mean value of the variable x and R represents the process range over time for continuous data.
ANALYSIS 1. 1-4: Annoyance or squeak and rattle; visual defects which do not affect functions 2. 5-6: Degradation or loss of a secondary function of the item studied 3. 7-8: Degradation or loss of the primary function of the item studied 4. 9-10: Regulatory and Safety implications The data is collected, recorded, and tracked multiple times using control charts. CONTROL CHARTS are graphical representation the data which is recorded in the form various machines and instruments. It depicts how a process evolves over a period of time. A control chart consists of a central line that represents the average, an upper line for the representation of the upper control limit, and a lower line that shows the lower control limit. These lines are determined from historical data. The most popular control chart for variable data is the X- bar and R Chart. Where X- bar depicts the average of the
The data that is recorded should always fall between the controlled range except for the common causes and if no special causes are identified. For a process to be determined as a statistical process there no be any exception or special cases included in the chart else there would some variation in data and may cause an error in the analysis which might cause some serious faults or errors in the prediction of the data. Some of the major causes of variation of data are mentioned below· Variation in material properties within specification · Seasonal changes in ambient temperature or humidity · Normal machine or tooling wear · Variability in operator-controlled settings · Normal measurement variation The Special causes are those cases when the error ranges beyond the control limit, if there is a shift/ change in a process, so on. While observing the data via SPC charts the inspector should verify that all the data points are accurate and within the control limit and also the inspection should observe if there is a change or a shift in the process and also that the control limit should fall between the specification limit mentioned by the project managers, engineers or customers.
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ABOUT US The word “Kaizen”, where “Kai” = change, “Zen” = good, which signifies change for better. In its birth place Japan, the word Kaizen is imbibed as a process that many small continuous changes in systems and policies bring effective results than few major changes. This methodology is applicable to every department across different sectors. Kaizen – The Official Operations Club of IBS Hyderabad has always been aspiring “Constant Change ad Evolvement”. We, as an organization work to inspire and aspire the student community for the betterment of the future. KORE – Kaizen’s Operations and Research Entity, one of our primary wings provides the students a platform to improve and hone their technical competencies to meet the changing demands of the organizations. KORE’s sphere of influence includes Case Based Research, Consultancy, Live Projects and Workshop. LAKSHYA, an initiative of KORE focuses on improving the readers knowledge about Operations Management by providing insights in the form of articles on various operation techniques followed by different companies and also updating the emerging trends in the communities.
K PAVAN KUMAR REDDY EDITOR IN CHIEF - KORE Kaizen – IBS Hyderabad Batch 2020-22
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LAKSHYA is an academic print and is not for any commercial sale. Reliability and Responsibility, for sources of data for the article vests with the respective authors. Please feel free to drop in your suggestions at kaizenclub.ibs@gmail.com KORE: Kaizen’s Operations & Research Entity. Kaizen – The Official Operations Club of IBS Hyderabad All Rights Reserved
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