Wednesday, December 12, 2007

Supply Chain in Diwali - Ops funda!


Oye, to all.... here's my take on Diwali :) yenjoy.... learn Ops fundas aswell !!!


Give and Take - Inventory Management Mom Style!!!


Operations Managament is the essence of life. It's all encompassing as well as it permeates everything! Take for instance this mail. The inputs are my weird thoughts, the output is the mail and the process of typing it, the value add ---------- yeah right :)!!!!

Diwali - the festival of light, is also the season where Mom's all across the globe face up to the big challenge of Inventory control. It's the time for the deluge, the give and take and the smooth maneuvering of gifts from one hand to the other.

Take my home for example. In Diwali, my Kitchen plays the role of a warehouse and MOM the part of the Inventory controller. Her job is not only to procure - gifts for people; but also find the right suitors for the parcels that are received from other people! Its not as simple as it sounds.

The thing about Gifts (mostly sweets and things to eat) is that , you need to do an ABC analysis of the inventory at all times and match the inflow value with the outflow value. If the outgoing value to the source is not atleast approximately equal to the incoming one from that source, it leads to supplier dissatisfaction. Whereas, if the outgoing value is greater than the incoming one, it leads to dissatisfaction of the inventory manager - my MOM .


The second challenge lies in the fact that at all times, the average space utilization of the gifts kept in the kitchen remains the same. So no matter how much MOM tries, the replenishment is always ready. Whenever she is absolutely ecstatic that the final gift was delivered, fresh stock arrives uninvited, with the additional burden of replenishing stock of equal value in order to send a return gift.

The third challenge is how to minimize the spend on gifts, by tactfully directing gift from A to Z and B to H and J to R and so on. At all times, the value of the interaction i.e. A to Home and Home to A should remain approximately equal. And its no easy task, mind it! MOM's through years of experience - recieve, evaluate, procure, inspect, handle, store and deliver gifts with such precision that each and every relationship becomes stronger and not one person is dissatified. It becomes almost second nature, involuntary to them. The challenge also lies in inspecting the gift, without spoiling the wrapper , in order to ensure that the gift has not been customised and codified to our name!

Also, the biggest challenge lies in the security of this inventory from a certain "ME" who has his eyes on the stock at all times. Pilferage - being a threat, stock counting is done twice a day and as it is inevitable, fresh order is placed in order to reach the minumum stock level, to prevent loss of dignity!!! The quantity ordered is instinctively calculated at "Economical" Order Quantities!!!

Finally, having a huge closing stock also creates health hazards for "ME" - because I generally recycle everything by eating it !! I generally END PRODUCT, i.e. I generally make "Finished product" a reality - I finish it alright !!! So the challenge is to have minimal to zero inventory at end of season. At this time, the tit-for-tat theory goes for a toss, and generosity comes to the fore. Even though obsolescence of stock is impossible (thanks to ME) , the stock is handed out in charity to the underprivileged. Not that I am complaining, but one person that is not satisfied is me :) Insatiable is my Nick name anyways.

If you come to think of it, JIT, lean supply chain -minimizing waste are fundas that are so astutely used during Diwali, the festival of light. Salute to MOM's and at some places Dads who manage this festival of give and take with such aplomb. As for my Mom, as I said, she has an addtional task at hand during this season, because for me personally - Diwali isn't the festival of " LIGHT ", my funda is Diwali - the festival of getting "HEAVY " :) hehehehehehehehe. So, a salute to her :)


Fundamentor...

2 comments:

Ashima said...

Hi,

Can you tell me where you got this fireworks image from?

Thanks
Ashima

Prabal Aggarwal said...

hi Ashima

We got it from google images.

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