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Master of Business Administration - MBA Semester 3
OM0012-Supply Chain Management
(Book ID: B1542)
Assignment (60 Marks)
Note: Answer all questions must be written within 300 to 400 words
each. Each Question carries 10 marks 6 X 10=60
Q1. What are the different factors affecting transportation decisions?
(Description/outline of different following factors and its sub factors
in students own words
Carriers
Vehicle related cost
Fixed operating cost
Trip related cost
Quantity related cost
Overhead cost
Customers
Transportation cost
Inventory cost
Facility cost
Processing cost
Service level and fast delivery
Answer. It is important to research the local market to learn the different
types of services provided by different carriers, and then select the carrier that
provides the best service.
This factor can be further divided as follows:
Q2 Write short notes on risk pooling.
(Description of risk pooling, importance of risk pooling in SCM,

Listing and summarization (along with suitable examples for each) of

four, types of risk pooling, Location pooling, Product pooling:
Lead time pooling
Capacity pooling)
Answer. Risk pooling and its types
Risk pool is a term used in risk management, mostly in insurance companies.
Under this system, insurance companies come together to form a pool, which
can provide protection to insurance companies against catastrophic risks such
as floods, earthquakes, etc.
There are several types of risk pooling strategies that are used in supply chain
management. Each of these strategies can help any firm to work effectively. A
firm needs to choose the strategy that is appropriate for a situation.
Q3. Read the following case study and answer the questions given the
end of the case study Best Supplier Relationship Management: Jaguar
Land Rover and Gobel & Partner Jaguar Land Rover production line 8
October 2013 | CIPS Supply Management Awards 2013 Jaguar Land
Rover (JLR) transformed its position in customer satisfaction surveys
and enhanced the quality of its products through an innovative
partnership with a key supplier.
By re-evaluating the way it deals with quality control and suppliers,
Jaguar took top spot in the 2012 JD Power Survey for customer
satisfaction and Land Rover raced up the chart. In 2008, the survey
put Jaguar at nine and Land Rover at 34 for quality, described by JLR
as clearly an unsatisfactory situation for a premium brand and
stated that something had to change. Component quality was
identified as the key issue for some suppliers the proportion of
rejected parts was as high as 65 per cent and some finished vehicles
were being put into containment due to faulty components. This had
knock-on effects including delayed customer shipments, production
line stoppages that cost 2,000 per minute and the risk that faulty
parts could make their way into completed vehicles. At the time, JLR
was working with 16 different suppliers across three factories to
undertake parts rework and containment, resulting in differing quality
regimes and an inability to share data across the company. As a

result, there was no single view of any given suppliers quality

history, which made preventative action impossible. A new director of
quality was appointed who launched a review of quality across the
supply chain that identified potential improvements that could be
made to the inspection of incoming components from suppliers. The
Inbound Materials Project was established and the 16 suppliers
dealing with quality control were reduced to one Gobel & Partner
(G&P) who saw it as an opportunity to introduce innovations and
boost investment in its Qtrak quality management system, which
totals 2 million to date.
This evolved into a partnership between JLR and G&P. Both realised
that prevention was better than cure, and through Qtrak they could
identify the component suppliers causing the most problems. Those
with a recurrent history of reject parts were subject to a more
rigorous inspection regime. G&Ps aim is to ensure no faulty part ever
arrives at JLR production facilities and they now work on the premises
of high-risk suppliers to review quality processes. The firm is also
working at JLRs new plant in China to ensure the right quality
approach is in place from the beginning.
Over six years, the relationship between the firms has evolved from a
traditional adversarial situation, where G&P were treated as one of a
number of commodity suppliers, to one where the two are working to
the

same

goal

of

bringing

premium

quality

to

premium

brands.Wolfram Leidtke, JLR board quality director, said: JLR is a

premium brand and accordingly needs to have premium quality
vehicles. Procurement has aligned with this objective. G&P has been
able to transfer their global knowledge and work with JLR to develop
a new approach to incoming material quality and the results are
starting to speak for themselves. (Illustrate the role quality played
as criteria in JLR choosing its supplier Gobel & Partner. Explain the
importance of Gobel & Partner in the supply chain(unit 6)
A Students should illustrate based on:
How critical is component quality to JLR
What were the effects of bad quality
What were the issues JLR had to tackle to working with 16 suppliers

 The steps taken by JLR to improve quality

Importance of the supplier) 10 marks
Answer. The role quality played as criteria in JLR choosing its supplier Gobel &
Partner
Quality plays a very important role as criteria In JLR choosing its supplier. It is
critical component.
As we see in the case study JLR was working with 16 different suppliers
across three factories to undertake parts rework and containment, resulting in
differing quality regimes and an inability to share data across the company.
The main bad effect of this bad quality was that, there was no single view of
any

given

suppliers

quality

history,

which

made

preventative

action

impossible. As I noticed after reading given study that only the quality was the
reason that made the Gobel & partner as supplier.
Q4. MTR Foods, the Bangalore-based food processing company, is
planning to utilise the services of a third party manufacturer for the
first time. The contracted plant in Mathura for producing vermicelli is
expected to give it a push in the northern and eastern markets where
it is trying to expand its presence. The company is also planning a
capacity expansion in spices.
MTR has nine plants in Bommasandra Industrial Area in Bangalore
which caters to its product categories like spices and masala,
beverages, vermicelli and frozen food. The company has so far
produced its brands inhouse. The plant in Mathura would help us
supply to the north and eastern parts of the country. It would help us
source wheat faster and also trim freight costs by 6-7 per cent, said
Sanjay Sharma, chief executive officer, MTR Foods.
Which according to you may then be distribution strategy used by
MTR? Justify your answer (unit 8)
(Explanation on the facts fitting the strategy
Identification of the strategy
Rationale behind choosing the strategy
Conclusion)
Answer. Explanation on the facts fitting the strategy

MTR Foods Ltd. is one of India's leading purveyors of packaged foods. The
company is one of only a few that sell packaged food nationwide. It pushed
into more cities in southern India, where it eventually gained leading market
share in every region that enjoyed a predominantly vegetarian cuisine. Market
opportunities also increased in Bangalore, which had become the so-called
Silicon Valley of India, the center of the country's booming information
technology industry. The name of the distribution strategy choosed by MTR is
intensive which fits to the facts of this food company.

Q5. Explain any four direct benefits of outsourcing with examples.

(unit 10) A any four of the following benefits (reason why this is a
benefit, description of the benefit and example)
Focusing on core competency
Reducing the expenses of manufacturing and logistics services
Reducing the head count of hourly employees and management
Improving the accuracy
Improving flexibility and wider range of services
Getting access to global networks and better technology
Improving services
Improving quality
Reducing capital investment and increasing cash flow
Answer. Direct benefits of outsourcing in detail are as:
Focusing on core competency When a company outsources manufacturing,
logistics, or both, then there is no requirement of resources to manufacture the
product, to store the product or to deliver it to the customers. The company
can utilise these resources for its core functions. For example, when a company
considers product design and engineering as its core competencies, then
outsourcing the manufacturing of the product helps in improvement of
designing and engineering capabilities.
Q6 Describe the supplier integration approach. Explanation of the
stages of supplier integration with suitable examples
None
White box

 Gray box
Black box
Answer. Supplier integration at any stage in the development process
happens to be advantageous. But survey results have revealed that suppliers
integrated Supplier integration at any stage in the development process
happens to be advantageous. But survey results have

Winter-2015
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