Last week, SICSR (Symbiosis Institute of Computer Studies and Research) hosted GNUnify, a conference on open source technologies, which attracted hundreds of students and other open source enthusiasts. Shirish has written a couple of posts on his blog about the talks he attended – read those to get a flavor of GNUnify (day 1, day 2). Usually, the presentations and discussions revolve mostly around the technology, but I decided to talk about not the technology, but about the economics of open source in particular, and free stuff in general.
If so much stuff is being given away for free, how is it sustainable? Programmers need to eat, even if they are immersed in the ideology of the free software movement. Businesses who give away free services exist for making money. So it is instructive to follow the money trail and look at who is paying for the free stuff, who is making money and how. As more of the business world is pushed towards free (whether they want to or not), it is important to understand the various fine points of the economics and sustainability of this situation.
I’ve embedded my presentation below. If you are not able to see it, you can download the PDF.
Pune is a hotbed of activity for CAD Software – both, for users as well as developers. We asked Yogesh Kulkarni, who has more than a decade of experience in this industry to team up with Amit Paranjape to give PuneTech readers an overview of this area.
Nonlinear statistics analysis of a 3D structure subjected to plastic deformations. Image by Joël Cugnoni courtesy the Wikimedia Project
CAD is defined as the use of computer technology to aid in the design of a part, a sub-assembly, or an entire product. Design can include Technical Drawings with Symbol based Representations, Visualization, 3D Rendering, and Simulation. Note, the term ‘Product’ could range from a small Widget, to an iPOD, too a large Building. Components of CAD technologies have also found widespread use in somewhat unrelated fields such Animation & Gaming.
Consider a World-War II era vintage B-17 Flying Fortress bomber; probably the only bomber ever to manufactured on an assembly line. How was it designed? Each and every part was painstakingly drawn on a drafting board. The various components and sub-assemblies were represented through various engineering drawing conventions. Yet the true visualization of how all these complex pieces fit and worked together, was left to that of the top engineers’ minds. And what about the complex 3-D shapes such as the wings? How were they designed and tested? Actual wooden models had to be created for this to visualize their shapes and test out their air-flow characteristics in wind tunnels. You can think of an army of literally hundreds of Draftsmen working on various pieces of this complex machine. Cars were designed the same way. ‘Machine Designing’ had elements of ‘Art’ in it. This style of designing was with us until recently. It’s only in the past 2-3 decades (even more recent in many SMEs in India) that computers have started replacing these ubiquitous ‘A1’ sized drawing boards that ruled the designers shop for so many decades.
Fast forward to today, and now let’s look at how Boeing’s latest 787 Dreamliner is being designed. This truly 21st century aircraft is built with composites instead of the traditional aluminum structures, and a whole bunch of other interesting innovations. All put together, Boeing claims to improve fuel efficiency by over 20% compared to other modern day commercial airplanes. All the designs of the Dreamliner are done using CAD. From the smallest widget to the entire airframe, the drawing, designing, assembling, and visualization is done on computer monitors. These designs are also evaluated for their validity and performance via Computer Aided Engineering (CAE). CAE works in conjunction with CAD to simulate and analyze various mechanical and other aspects of the design. Similarly, Computer Aided Manufacturing (CAM) works closely with CAD to help manufacture the complex parts on Computer Numerically Controlled (CNC) machines.
History
CAD has evolved a great deal over the past few decades along with the rise in computing and graphics power. Earlier CAD solutions were simple 2-Dimensional solutions for drawing machines and structures. These still represented a big step forward over drawing boards in terms of ability to save, edit and reuse drawings. Initial 3-Dimensional solutions were based on ‘wireframe models’ and ‘surface modeling’. Loosely speaking, these represented the outer edges and the external surfaces of a solid object in mathematical terms. Real 3-D capability involves representing the real object as a solid model. Mathematically, this involves a series of complex equations and data points. This had to wait for computing power to catch-up. Only in the late 1980s did this power become available to a wider engineering community via desktop workstations.
At a high level, you can think of a CAD package to have 2 important pieces: 1) The backend mathematical engine and 2) The front-end graphical rendering service.
Earlier CAD programs were primarily written in FORTRAN. Present day, CAD packages are typically developed in C or C++. Rendering was not a strong point of the earlier solutions. However over the past 2 decades, life-like rendering and simulation (rotation, motion, etc.) have become a reality. This capability has also taken this technology into the Animation & Gaming fields.
Associated Areas
CAD works closely with other allied areas such as CAE (Computer Aided Engineering), CAM (Computer Aided Manufacturing), as well as PLM (Product Lifecycle Management). In fact, CAD/CAM or CAD/CAE are often used together to describe the entire workflow. In this section we will take a brief look at these allied areas. In future, PuneTech will feature more detailed and specific articles about each of these areas.
Computer Aided Engineering is the use of computer technology to support engineering tasks such as analysis, simulation and optimization. These tasks are often performed by the engineer in close synchronization of the actual CAD activities. An example of ‘Analysis’ could be leveraging mathematical techniques such as ‘FEA/FEM’ (Finite-Element-Analysis/Finite-Element-Method) for designing a safe Bridge. ‘Simulation’ can be used to study how a mechanical assembly with various moving parts work together, on a computer screen, before actually building it. ‘Optimization’ can build on top of Analysis and Simulation to come up with the ‘most optimal’ design that meets the designer’s requirements. ‘Most Optimal’ could mean least weight, smallest number of parts, least friction, highest reliability, etc. depending on the designer’s primary objective.
Computer Aided Manufacturing is the use of computer technology to manufacture complex parts on automated machine tools. These machine tools are commonly referred to as ‘CNC’ or ‘Computer Numerically Controlled’ machines. Here’s a simple example. Let’s say an engineer has created a complex 3-D shape consisting of various contours for a new car’s exterior. The exterior parts are made by die-stamping in huge presses. The ‘dies’ are essentially molds made of hard metal. Principally, they are similar to a clay mold that is used to create various artifacts out of Plaster-of-Paris. These metal dies themselves have to be created by machining a ‘die-block’ to create a solid mirror image of the final part. This complex 3-D shape needs a sophisticated machine tool that can machine (cut/drill/shape) metal across multiple (3 or more) dimensions.
Controlling the motion of these machine tools is similar to controlling a robotic arm. CAM packages convert the solid designs in CAD packages into a set of coordinates and path instructions, along with desired speeds & acceleration/deceleration profiles for the machine tools, and communicate these instructions to the CNC machines.
PLM or ‘Product Lifecycle Management’ is not directly related to CAD like CAE or CAM. Instead, PLM as the name suggests focuses on managing the entire lifecycle of designing activity across multiple groups and departments in a company. A complete design is not limited to the machine designer. Various other players come into the picture. These include Purchasing Managers who have to source design components and sub-assemblies from vendors; Cost Accountants who want to keep a tab on the overall material and manufacturing costs of a design, Compliance Experts who want to review the design for various agency compliance requirements, etc. Similarly there are requirements to maintain the design as it goes through various versions/upgrades through its life-cycle. PLM enables collaboration across different departments on the key aspects of the design. PLM also enables collaboration between designers in terms of sharing parts data, etc.
Major Players
AutoCAD® by Autodesk is one of the most popular CAD packages out there. It focuses more on 2-D drawings such as part drawings, architect plans, electronic circuit designs, etc.
Packages like Catia® by Dassault, NX® by Siemens-Unigraphics, Pro/E® by Parametric Corporation are popular 3-D Solid Modeling Solutions. These solutions find wide use in Automotive, Aerospace and Other Manufacturing Industry Segments.
CAD in Pune
Due to the strong industrial and manufacturing base, Pune not only contains some of the biggest users of CAD/CAM software, but it also hosts some of the biggest developers of CAD/CAM software in the world.
Leaving the sobriquets such as ‘Detroit of East’ aside, it is safe to say that Pune is indeed the primary automotive hub of India. Pioneering Indian automotive companies such as Tata Motors, Bajaj Auto, Bharat Forge and Kirloskar Oil Engines are headquartered here. Along with these, a number of top multi-nationals such as Mercedes-Benz, General Motors and Volkswagen are also based here.
These big auto-majors, along with other industrial powerhouses such as Cummins Diesel have created a strong industrial manufacturing ecosystem in Pune. These OEM (Original Equipment Manufacturers) in turn drive requirements for sub-assemblies and components to Tier-1 and Tier-2 vendors.
A large number of small and med-sized industrial automation companies have also sprung up in Pune. These companies design and develop various factory automation and material handling solutions for automotive as well as other industries.
Designing activity is important at all levels, in all these companies – big or small. As a result, Pune has become probably the biggest user of various 2-D and 3-D CAD applications and other associated CAE/CAM applications, in India.
However, the ecosystem for CAD doesn’t stop here! Given Pune’s dominance in Information Technology and the huge CAD users’ base, many CAD/CAM/CAE software companies worldwide have found Pune to be the natural choice for their R&D and Service Centers. All CAD majors described in the earlier section have some development presence in Pune. Pune also has software service companies focusing on this area, such as Geometric Systems.
Amit Paranjape is one of the driving forces behind PuneTech. He has been in the supply chain management area for over 12 years, most of it with i2 in Dallas, USA. For more details, see his PuneTech profile.
‘Maha’ DeshMart is a large (fictional) supermarket chain with a pan-India presence. Amit Paranjape, our resident expert on Supply Chain Management, discusses some of their management strategies and best practices. Special emphasis is put on the importance of ‘Information Technology’ and how it enables ‘Maha’ DeshMart to run one of the most efficient Supply Chain & Operations. Benchmarking is also done with global industry leaders such as Wal-Mart. 2008 represented a challenging year and we will take a look at how specific Supply Chain Processes and the other aspects of Retail Operations react to the global economic challenges, and can still deliver on the overall goals and objectives of the company. This fictional story about the fictional ‘Maha’ DeshMart is in continuation to our series of articles on Supply Chain Management.
‘Maha’ DeshMart
‘Maha’ DeshMart as the name suggests stands for everything ‘large’ (‘Maha’ in Hindi / Marathi / Sanskrit = ‘Large’ or Huge’). Some say ‘Maha’ also stands for ‘Maharashtra’ the home state of the founder, Raj Deshpande. ‘Desh’ comes from the founder’s last name. This chain is also often referred to as simply ‘DeshMart’. Ever since opening its first store in Pune about 15 years back, it has gone through a rapid expansion and now had a presence in every major Tier 1 and Tier 2 city in India, with aggressive plans to expand to Tier 3 cities as well. DeshMart’s vision is to be the most preferred shopping destination for the Indian consumer; period. To achieve this, they want to have the widest choices, the best prices, and the most comfortable shopping experience for their consumers.
It is no secret that the DeshMart founder was inspired by world leader in retail, Wal-Mart, and its philosophy of scale and constantly driving down costs. The Wal-Mart business model is actively pursued here in their Pune headquarters, as well as in all their stores and throughout their supply chain. The management team though has taken a series of strategic decisions to ‘Indianize’ the model to suit the local context. For example, while ‘ELDP’ (Every Day Low Prices, as opposed to Promotions) was the generally preferred strategy, some key exceptions were made based on local preferences. The other one is to enshrine a ‘Neighborhood Kirana Store’ owner type mentality into the Store Manager and his team. In India, the small neighborhood ‘Kirana’ (or grocery) store is run by a family with the patriarch serving as the CEO, Head of Operations, and all other roles combined. The rest of family fills up various other support roles. One thing this model provides is an ‘amazing’ ownership of the business and the consumer. DeshMart wanted its Store Managers to think and act, like the Kirana Store Owner. Metrics have been suitably adjusted to encourage the right behavior; however the core difference has been through intense focus on Hiring & Recruitment. Extraordinary importance is put on finding the right talent for these critical positions.
The Importance of Information Technology
Another key Wal-Mart strategy that has been espoused by DeshMart is focus on Information Technology. At DeshMart, IT is considered to be one of their biggest strategic differentiators. They don’t want to rely on any one or even a few different application software vendors for their business process applications. Instead, they have followed the example of Wal-Mart, Dell, FedEx, and Toyota and have taken complete ownership of their IT Applications & Infrastructure. These great companies have supported their unique business processes by designing and developing their own IT solutions where necessary. Here again, DeshMart put lot of emphasis on hiring the right CIO (Chief Information Officer). In fact in the early 1990s, when this position was virtually unknown in India and in many other places around the world – they had a CIO and his senior team in place.
The IT Department’s mission is to deliver the requisite data and decision making capabilities at the disposal of every DeshMart employee throughout the organization, in order to deliver on the overall goals & objectives of the company. Organizationally, IT was aligned along with the business process teams in such a way that for every project there was no ‘IT vs. Business’ division. The combined team had the singular goal to achieve the necessary process improvement metric.
The 2008 Global Economic Slowdown
The 2008 Global Economic Slowdown was not predicted by even the top experts on Wall Street. Thus, even the best of the supply chain leaders didn’t have any ability to accurately forecast the impending shortfall in demand. The only way for a company to react to something like this was through some rapid adjustments to their plans, and execute as efficiently as possible. The first signs of the slowdown were visible too late for planning the 2008 season. In the following sections, we will look at how DeshMart’s IT and Business Processes reacted to this challenge.
Merchandizing & Assortment Planning
Let us take a step back here and understand how large multi-product category retailers worldwide do their long term planning. For many retailers, especially for those heavily weighted towards fashion segment, the holiday season (last 5-6 weeks of the year, in the US – from Thanksgiving weekend to Christmas/New Year) could account for anywhere from 20% to even 50% of their annual revenues. In India, the holiday season traditionally runs from Diwali (The Festival of Lights), in October/November to the December End wedding season. Similar holiday season spikes are also observed in the Indian market.
To react to this end of the year demand, retailers start planning a year in advance. The overall merchandizing decisions (deciding what products to buy and position in the stores) are the first step. This process is called as ‘Merchandize Planning’. A ‘top down view’ is often a starting point, where a revenue forecast is broken down across different product groups (commonly referred to as ‘categories’) and then finally to the individual product (e.g. a pair of pants). Similarly, a geographic top down view is taken where the global revenue number is broken down by regions and eventually down to the store level. A ‘bottom up’ view can be taken based on actual product level forecasts. Often times, ‘middle-out’ view is also done at one of the intermediate points in the hierarchies. All these views are synchronized closely before arriving at final numbers and targets. This process sounds straight forward, but is complicated by the sheer size of the retail problem. Imagine doing these aggregations for 100,000 products! (A typical Wal-Mart stocks well over 200,000 products). Now add the store dimension (Major US chains have 1000s of stores), and you will get the idea of the scale problem. As a result, merchandize planning drives some challenging scalability requirements for databases and servers.
Table 1: Retail SCM & Operations – Business Processes & IT Drivers
Business Process
Focus
Key IT Drivers
Merchandise Planning
Selecting the right products to purchase for the season/year, based on corporate objectives and setting sales targets Scalability
Multi-level aggregation/dis-aggregation
Assortment Planning
Grouping stores based on similar characteristics. Selecting what store groups have what products
Optimization Algorithms for identifying the right store groups (clusters).
Transportation Planning & Logistics
Delivering the product to the stores while minimizing transportation cost.
Transaction Management for handling large volume of shipment orders
Optimization Algorithms for truck load building and route planning
Replenishment & Inventory Management
Getting the right amount of the product to the store, while minimizing excesses and reducing out of stocks situations
Scalability
‘Fast’ algorithms for calculating replenishments and inventory targets
Store Operations
Presenting the products appropriately
Collecting POS data
Managing customer loyalty
Scalability POS Data Collection Systems Business Intelligence & Data Mining
Algorithms for ‘Planograms’
In case of DeshMart, the problem is not as massive as Wal-Mart, but still quite big. At present, DeshMart has over 500 stores with anywhere from 10,000 to 50,000 products in a given store. Initially, at the beginning of the year, they had done the merchandize planning assuming a specific forecast value for the end of the year period. Now, they need to alter it, and propagate it down the hierarchy. This adjusts the forecast for individual products. This will in turn affect the purchasing decisions. In some cases (as it turned in DeshMart’s case…) it is too late to do this, since long lead time items are already on order. In such cases, various promotions/ discounting strategies are worked out to push the excess merchandize out. Note that given DeshMart’s unique customer loyalty and cost advantages, a down market can also be an opportunity. For example, Wal-Mart actually had more sales compared to previous quarters in the 2008 slowdown since the cost conscious consumer from other competing stores increasingly moved their shopping to Wal-Mart. Hence while adjusting the merchandize, DeshMart also considered this aspect as an input.
Once the product level forecast is available, the next challenge in a multi-store retail environment is deciding what stores carry what products. Not all DeshMart stores are the same. They differ by types of cities, as well as location of stores within cities. The typical product mix of a store in Central Deccan Gymkhana area of Pune is different from that in the Hadapsar suburb. A Mumbai store would differ in its product selection than say, a store in Indore. These product selections are referred to as ‘Assortments’ and planning them is called as ‘Assortment Planning’. Here too, scale is a big issue. Various algorithms are used to group stores based on their commonalities into groups or ‘clusters’. Then assortment decisions are made at the cluster level.
When the economic down turn hit, not only did the merchandizing decisions change, but also certain assortments by stores. To give an example stores in up market areas were now stocked with certain products normally allocated to more middle income areas. DeshMart was able to make these changes quickly by redoing certain clustering and changing allocations.
In both merchandizing and assortment planning IT plays a key role in providing the planners with a key capability to make fast and accurate decisions, while dealing with a huge amount of data. Handling large volumes of data, large scale aggregations and dis-aggregations, scenario planning & what-ifs are also important IT requirements for these business processes.
Logistics & Transportation
If ‘Supply Chain Management‘ is loosely defined as ‘Getting the right product at the right place, at the right time’; then ‘Logistics & Transportation’ is one of the core execution pillars of realizing this. Logistics deals with the overall handling, distribution and shipment of products through the supply chain, while transportation is focused more on the physical shipment of goods and products. In a sense transportation can be considered as a subset of logistics, but often times these two terms are used interchangeably.
For large global retailers, the transportation problem typically begins at their warehouses. Product manufacturers are responsible for shipping material into these warehouses. (Note there are some exceptions such as Vendor Managed Inventory & Direct Store Shipments, but we will not discuss those here…).
The primary goal of efficient logistics & transportation planning is to get the product to the store at the right time, while minimizing cost. Warehouse management – ensuring smooth and efficient inflow and outflow of products is the first step. One relatively new technology that is being used in some places is ‘RFID’ (Radio Frequency ID). These are small tags (like a semiconductor chip) that are attached to stocking pallets, cases or other products that need tracking. A radio frequency based reader then ‘reads’ from this tag. This helps in easy tracking, sorting and distribution of products in a warehouse, while minimizing manual intervention. Some of these warehouses span many acres and have 1000s of pallets, miles of conveyor belt and typically handle over 100,000 individual products. Hence automated tracking is very important. RFID systems also need efficient large scale data acquisition and storage systems to handle this high volume data.
Truck load planning and truck routing are two important pieces of transportation planning. The challenge in truck load planning is filling up the truck to a full truck load with multiple products, while minimizing excessive shipments to the store (Note – It is always easy to ship a full truck load, if ‘stuffing’ it with unnecessary excess stuff is allowed…). The challenge comes in when this restriction of not shipping too much excess products comes in. Remember, excess product takes up excess space, as well as locks-up excess capital. This is bad for the overall financial performance. Various optimization based approaches that trade-off between cost of shipping early, vs. sending partial truck loads (thus trading off between excess inventory carrying costs vs. excess transportation costs…) are used to figure out the right loading mix inside a truck. In case full truck loads are not possible, then smaller shipments are loaded in, to be delivered to different destinations (typically different stores). This is called as ‘LTL Shipments’ (LTL = Less Than Truck Load). Here the challenge is to come up with a efficient truck route so as to minimize the distance traveled.
Hence if the DeshMart warehouse in Vashi, New Mumbai is shipping LTL shipments to the suburban stores in Bandra, Andheri and Mulund, the optimized route could consist of Vashi-Mulund-Andheri-Bandra. This seems relatively straight forward, but there are a lot of other constraints in the real world. There are some loading constraints, precedence constraints, traffic constraints, regulatory constraints that can influence the most optimal route on a map. Also, for a large retailer like Wal-Mart this process has to be done for 1000s of trucks every day. The IT systems have to deal with managing these whole sets of transactions as well as the decision making processes. They need efficient data integration with the IT systems of external logistics providers as well as suppliers.
In DeshMart’s case, there are also a series of local constraints that are peculiar to the Indian market. Shipping times in India can be fairly non-standard as compared to that in the US. Most truck operators are not organized into big companies. Regulatory requirements like Octroi (a local city tax) can add delays to the process. Enforcement of driving standards/time can also be a problem. Hence similar to Wal-Mart, DeshMart had made a strategic decision to own a private fleet of trucks for their transportation needs. This enables them with greater control over the whole process.
As we saw earlier, the impact of the economic slowdown led to last minute adjustments in assortments. Such changes, as well as those coming from sudden surges in demand can be better handled with a private fleet. DeshMart’s trucks also use the latest GPS based navigation and logging technology that enable the logistics master controller to keep exact track of each shipment in real time.
IT enabled dynamic logistics & transportation business processes helped DeshMart to better respond to the challenges of the ‘real’, ‘unplanned’ world, while keeping transportation costs at minimum.
Store Level Replenishment & Inventory Management
Store Level Replenishment & Inventory Management deals with calculating the right levels of products that are maintained at the individual stores. Too few and you run the risk of running out of stock, often resulting in lost sales and unhappy customers. Too many, and you take up excess space as well as occupy excess working capital.
Specialized replenishment and inventory management IT systems can react to daily fluctuations in the demand signals and pre-calculated forecasts at the store level and identify the right quantity of each product that needs to be shipped to the store. A variety of algorithms are used to do this, and like all other retail problems – scale is a big challenge. Imagine planning 100,000 products across 1,000 stores. The number of products-stores combination goes into millions! Now consider that this planning has to be done for the forecasted demand for the time horizon of next 2 weeks. Each day represents a new demand entry. Thus this further increases the problem size by an order of 14!
Daily demand fluctuations are usually computed based on ‘POS’ (Point-Of-Sale’) data. This data is often directly generated at the systems at the point where the sale takes place (e.g. cash register). POS Systems collect validate and transfer this data to the Replenishment System.
Through efficient store replenishment, DeshMart can make sure that they have the right product at the store, while keeping their costs low. The same cannot be said about their competitors! In fact, walk into any retail store today in India, and chances are you would find many of your preferred items to be out of stock. This goes a long way in generating the customer loyalty that DeshMart has been able to create over the years. What many of the new retail chains don’t seem to realize today (and what some ‘Neighborhood Kirana Stores’ do very well…) is that it is not the fancy layouts, air-conditioning, jazzy promotional material, etc. that attracts the customers! It is being repeatable and consistent and always having the fast moving goods in stock at all times – this is what the customer ultimately cares about!
Store Operations
Store Operations for DeshMart represents a great challenge and a terrific opportunity. Store operations in India can be quite different from that seen in the US or other developed countries. To start with, the store footprints are much smaller. The assortments are also smaller, but there is a lot of localization. For example, a large percentage of the assortment of a store in Chennai will differ from that in New Delhi. Managing store layouts and displays and locating the right stuff in the front, at the end aisles is very important. DeshMart uses CAD like software capabilities to do ‘Planograms’ (Planograms refer to the designing of products placement on the various shelves, while accounting for display priorities as well as the products’ volume dimensions). A fairly unique service in India is ‘home delivery’ service, provided by many grocery retailers. Ordering is either done over the phone or in person. A store level order entry and tracking system captures the order and coordinates the home delivery. DeshMart will be the first retailer in India to launch a completely web-based & call-center based ordering system, starting early next year. Here the order will be accepted and promised centrally and delivered from a central warehouse or a nearby store. This ‘hybrid’ web and brick and mortar model will be fairly unique not only in India but globally as well.
Customer loyalty is key for DeshMart. They have implemented a sophisticated customer loyalty program. A unique card/id number is assigned to a customer and rewards are given based on amount of purchase, as well as other special criteria. DeshMart collects, analyzes and mines customer buying preferences in their centralized business intelligence system and comes up with pricing and product placement strategies. Customer specific targeted emails and other specials are also managed through this system. For example, DeshMart’s data mining system can literally predict what special brand hair oil Mrs. Shah from Ahmadabad is likely to buy and at what frequency – and automatically send specials (or alerts) for the same!
All these entire store-centric systems ensured that even when the consumer spending all over India was going down, DeshMart still had their loyal customer continue to find and spend on the right product mix at their stores.
Conclusions and lessons learnt
In retrospect, the 2008 economic slowdown turned out to be a blessing in disguise for DeshMart. Through their superior business processes, management teams, and IT systems – they were able to not only react effectively to the changing market dynamics; they were also able to grab even higher market share. This same slowdown saw big troubles for many of DeshMart’s competitors, some of which like ‘Bharat Bears Mart’ actually went out of business.
Raj Deshpande reflects on this ‘interesting year’ and ponders how these 3 basic principles go a long way for his business success:
Focus on the customer – learn from the neighborhood Kirana Store.
Focus on costs at all costs – learn from the world leader, Wal-Mart.
Focus on leveraging IT for business – learn from industry leaders.
This is the third in PuneTech’s Improving Education series of posts detailing the efforts being taken by people in the tech industry in Pune to give our students a chance at giving their career a solid foundation by acquiring skills that are valued in the industry with guidance from experienced mentors from the industry. The first in the series was Techstart.in, a program to nurture the passions of students by guiding them to implement specific, and interesting projects. The second was KQInfoTech’s Post Graduate Diploma in Systems Programming where the students don’t actually pay for the course, but end up being funded by industry in return for completing projects.
The third is “Peepaal – Continuous Community Learning” is an online and offline community of industry professionals, college faculty, and students that aims at providing continuous guidance to students through knowledge, best practices and processes. This is a description of Peepaal in the words of one of the founders:
1.Introduction – Bringing Industry and Academics Together
Bill Gates (Windows) , Steve Jobs(Mac, iPod, iPhone), Larry Page & Sergey Brin (Google), Orkut Büyükkökten (Orkut),Mark Zuckerburg (Facebook) , Sabeer Bhatia (Hotmail) apart from being successful have one important fact in common. They were all young when they dreamed of transforming the world into a better place to live. The truth is the pioneers in the technology field have been youngsters who have time and again brought new path breaking perspectives and solutions.
After 25 years in the IT field India has become the outsourcing hub of the world albeit with some deficiencies. On the pioneering front we are still some steps behind. Why in spite having such a large pool of vastly talented students are we still lagging behind? This is a million dollar question. But the answer to the question is easy.
Our students have always learned in a vacuum far away from the reality. Firstly they only have a very distant view of the needs of the industry and secondly they have passive view on the problems faced by the people and society. Good industrial skills are needed to become successful professionals of the IT industry. Identifying practical problems and solving them will make the leaders and pioneers of tomorrow.
Peepaal aims to become that easily accessible Bridge between the students and the industry. Peepaal aims to become that great ladder on which the pioneers and leaders of tomorrow will climb and make a difference to the society we live in. Peepaal aims to become that Guruwho will always show the right path to the students. Peepaal aims to become that Familywho will nurture the students to become as independent as possible. Peepaal aims to become that Friendwho will bring students with similar thoughts and interest together.
2.Do our talented students need improvement? Can it be done?
The Peepaal initiative was born out of our various interactions with students, faculty and our experience with freshers entering the industry. Each of these experiences reemphasized the significant need for Industry to provide a very strong collaborative role in shaping students and supporting faculty in delivering industry relevant knowledge to students to ensure they are more well rounded professionals by the time they enter the industry. It was also clear that this is not possible without continuous support from the industry and a collaborative model for delivering knowledge, best practices and processes.
While there are a number of areas that require focus we have identified some core focus areas for Peepaal and use projects as a mechanism for being able to deliver these improvements.
Why Projects? Well Projects have been something the students have been actively working on during their course curriculum and their is a significant focus on projects among students and faculty and we think it is a great mechanism to deliver knowledge. The issue however is that the current process of executing projects leaves a lot to be desired.
We expect to significantly alter the way student projects are executed and help them in the following:
Innovate: Projects canbe a key medium to innovate and learn new ideas and principles and apply them in real world. We expect Peepaal guided projects to be able to help students to Innovate in the real world and follow cutting edge technology trends. In addition we believe the core CS fundamental concepts are key to ensuring that students deliver value from their project. Concepts like Data Structures, DBMS, operating Systems for example have to be understand and applied well on projects so that students learn by doing.
Execute: If a project does not succeed, the value of the effort is reduced to naught and it turns into an academic exercise. There are various industry proven methods like “Proof of Concept” implementation which helps support this. We expect the Peepaal Barcamps and the online portal to serve as checkpoints and support mechanism to significantly increase the number of successful projects.
Showcase: While an Idea looks great on paper and even after it is successfully executed it all boils down to how well you can showcase it. This applies to student projects as well. There is a considerable lack of awareness of the need and techniques to successfully showcase a project to an audience. Through a continuous stream of Barcamps and presentations we expect to significantly raise the bar on project presentations.
3.Objectives of Peepaal
How does Peepaal plan to solve the problem areas? Following are the high level steps Peepaal is undertaking at a brisk pace:
Establish strong collaboration between students and the industry to bring the students into reality.
Establish strong collaboration between students in various campuses.
Engage the faculty in healthy discussions and suggest solutions to the problems they face to enable successful projects.
Help students in the entire life cycle of their projects.
Provide technical and industrial knowledge,best practices to the students in an easy to understand format.
Compliment the students academic education with the learning and applications of the latest trends and technologies.
Provide guidance to the students in every manner so that they do not have to reinvent the wheel like the students of the past.
Encourage innovative ideas from the students that will have profound effect on the society we live in.
Encourage discussions so that students open up to share problems and seek solutions.
4.Peepaal Online Portal
Peepaal online portal http://www.peepaal.org/campus provides the much needed platform where the students, faculty and the industry come together. Following are the objectives it aims to meet:
Establish a strong communication mechanism between the students and the industry. Students, Faculty post questions on the discussion forums and the industry experts answer them in a simple easy to understand format.
Provide Students with articles that give them insight on the latest trends and technologies.
Prevent Students from re-inventing the wheel by suggesting them right tools,techniques and designs.
Provide Students with a forum to improve their interpersonal skills.
Provide industry experts a simple way to interact with students instead of visiting their colleges.
Provide industry experts to talk to a greater audience and use this greater audience in useful ways.
Community features that will get students with like thoughts together.
5.Peepaal Barcamps
Peepaal Barcamps are an innovative process model to guide the students in the entire life cycle of their project. Peepaal aims to be as close to students as possible in this regard. Peepaal engages face to face with the students during the course of their project through various Project BarCamps and campus events.
We have already conducted a number of BarCamps in the first season where we addresses close to 1000 students across various colleges across Pune. Starting January we will conduct an additional 18 Barcamps across 10 colleges in Pune where expect to work with close to 1500 students on their projects.
Some of the colleges that we are currently work with include Symbiosis, Nowrosjee Wadia, PICT, MIT, VIT, Fergusson, Modern, SP College.
6.Peepaal Linked-in community
Peepaal has setup a linked in community. This is the place where the industry experts, students and faculty will get together for discussions and debates. These discussions will give Peepaal great insights into the initiative and further improving the initiative.
All of us are aware that our educational system needs a lot of support if we want to sow the seeds for transformation in society for the future. The source for innovation and execution lie in our future students and it is all of us as experienced professionals who are best suited to provide this support. All it would take is a few hours of your time online or offline to make this impact. You can join us in our discussions online, on the portal, in the linked in community or join us for the Barcamps.
The number of Industry professionals have grown rapidly since we have started and we have close to 50 Industry professionals registered for the initiative and over 800 students impacted by the program. We do however need a lot more industry participation to ensure we have significantly broader impact across a larger number of students. If you are an Industry Professional, Faculty or a student and if all of this makes sense to you and you would like to join us on this initiative drop us a line at peepaalcampus@gmail.com and we would be happy to meet up with you to get started.
What to expect – Industry Professionals
An industry professional who wants to get involved with Peepaal should expect to:
Conduct Mock Interviews
Discuss and Refine Project Ideas
Mentor Projects Online
Own Technical Focus Areas
Drive Technology Trends
Support Campus Contact Programs
Collaborate with your campus
Discuss and Collaborate with Peers online
All you need is 2 hours a week
What to expact – Students
A student who gets involved in Peepaal can expect the following help:
The Department of Scientific and Industrial Research (DSIR) is a part of the Ministry of Science and Technology, and has a mandate to carry out the activities relating to indigenous technology promotion, development, utilization and transfer. The primary endeavour of DSIR is to promote R&D by the industries, support a larger cross section of small and medium industrial units to develop state-of-the art globally competitive technologies of high commercial potential, catalyze faster commercialization of lab-scale R&D, enhance the share of technology intensive exports in overall exports, strengthen industrial consultancy & technology management capabilities and establish user friendly information network to facilitate scientific and industrial research in the country.
The Technopreneur Promotion Programme (TePP) TePP along with its network partners provide grants, technical guidance and mentoring to independent innovators to emerge as entrepreneurs by incubating their idea and enterprise in two phases. Till date 250 innovations have been supported. Proposals are now invited on for support in the year 2008-09.
PuneTechies Amit Paranjape (of PuneTech!) and Unmesh Mayekar (of SadakMap) who attended the event sent in the following notes of the meeting for the benefit of PuneTech readers.
Amit writes:
TEPP Program can provide grants upto Rs. 60 Lakhs to entrepreneurs. Note these are ‘grants’. For further details on the application process and other details, please checkout the following website:
The TEPP Program does not directly cover software companies (All companies that develop some ‘hardware’ are covered). An exception is made in case of software companies in the ‘Security’ area.
However, TEPP/allied programs can help software entrepreneurs in patents/copyright protection related expenses, upto Rs. 15 Lakhs.
Unmesh adds:
Rs. 60 lakhs is given in 2 phases of 15 and 45 (the second phase funds becoming available if the first phase is successful)
The process takes from 3 to 6 months. It takes time to prepare the application for the grant. The acceptance rate is low.
It helps to have patents. The IP stays with the innovator.
There is a students entrepreneur program that funds upto Rs. 75000 for projects.
For software there are other groups that provide seed such as SINE, DST
Moral of the story: If you are an innovative entrepreneur, check out the TePP. And if you are attending some tech event in Pune, please take notes and send it to us, for the benefit of the larger community.
This week on PuneTech, we are going to feature a bunch of initiatives started by people who are passionate about helping students in our engineering colleges (actually anybody interested in technology, student or not, engineering or not) to be more, achieve more, learn more, all with the help of mentors from industry who would like to see all these talented students reach their true potential. Watch this space over the next few days for more such initiatives or better yet, subscribe for updates via RSS, Email, or twitter. Today, we are featuring, Techstart.in. (Update: the next post in this series is about KQInfoTech’s industry-supported “free” PG Diploma in Systems Programming.)
Techstart.in is a group that aims to create special interest technology clubs of students, with each club mentored by one or more people from from industry who have experience in that area, and are willing to spend time with the students to guide them. The club will have loosely structured activites, projects to complete, possibly presentations and discussions, all planned and guided by the mentors.
The club was started by Freeman Murray and has since been joined by a number of mentors – but there is no such thing as too many mentors. So, you should seriously consider signing up. The only qualifications you need are that you should be passionate about this, and you should have a little industry experience.
Freeman explains techstart.in thus:
The basic idea is to find people with practical industry experience willing to spend some time each month creating or identifying useful exercises people interested in their field could do to develop their skills and posting them on a blog or mailing list. Additionally they spend time each week facilitating a discussion of the participants on a mailing list.
The intention is not to compete with existing online resources for technical training and support, but to provide some more human support and mentorship for people on the path. Mentors can and should encourage participants to engage in the existing online communities surrounding their technologies. Their guidance as to what communities to engage, and how to engage could still be invaluable.
In this way, over time people can develop significant skills in fields where they don’t have formal training while they continue their studies or working full time.
We all crib about the quality of technical education, but with the Internet we have the opportunity to do something about it. We can help eager young and the motivated who want to get into high-tech but are over whelmed at the amount of information available on the internet, or get blocked because of elementary problems.
It shouldn’t take much time, for mentors just a couple hours a month to research the monthly activities and post links to learning resources participants should look into, and then a couple hours each week responding to questions and facilitating discussion on the mailing list. For participants, activities should take 5 – 10 hours of effort each month, plus some additional time sharing with the community thru the blog and the mailing lists.
If there’s a field you are passionate about and feel more people should get into, please think about setting up a small club for it on the techstart wiki. If you see a club where people are exploring a technology you’ve been curious, by all means join the community.
The initial clubs we have are in blogging, advanced java and open source technology. Amit is also mentoring a group to write some automatic deployment scripts in php.
To participate in one of the techstart clubs simply visit the clubs website, or join the their mailing list. Make sure to introduce yourself to the community when you join, and read over any introductory material the mentor put up on the website or in the group.
How to participate – Mentors
Start your own club or make yourself available for mentoring people on a project – simply create a mailing list for it on Google Groups or any other public mailing list site, and add a description of it and yourself to this wiki. At least every month post exercises to the list which participants can do to strengthen their skills, and spend some time every week monitoring the list, encouraging discussion, and helping people with problems. That’s it !
Contact [mailto://freemanATpobox.com|Freeman] to get the wiki key. If you’d like to join the discussion about how to make TechStart better please join the TechStart Google Group
This track is for people interested in writing on the internet. All participants will set up and customize their blog initially, and then every two weeks participants are encouraged to share their next post with the group. The group will give feedback on the writers style, grammer and ideas. Members are additionally encouraged to comment on eachother’s blogs and do cross linking. Occasionally exersizes relating to google analytics and SEO will be given to the club members. Twitter, Videoblogging , Google Analytics, SEO, RSS and feedreaders will also be discussed in time.
This learning track is for developers who have completed at least one course in Core Java (or are familiar with basic principles of Java, like syntax, compiling, and running Java programs) and would like to improve their understanding of the Java language and ecosystem.
This is a track for technologists who want to build upon their understanding of the free and open ecosystem being provided by the Open Source and relatively open and portable datasets. Do you dig a well everytime you want to drink water, then why do you insist on hacking a new solution when another more efficient solution already exists as Open Source. Leverage what already exists in the ecosystem instead of re-inventing the wheel.
Ami of this project is to automate the process of deploying websites written in PHP. A very basic script exists at my blog, we will be enhancing it by putting continuous integration, database migration etc.
This post is an introduction to the world of mobile and embedded software, which is a sub-discipline of software with a bunch of interesting quirks of its own. This introductory post is a first in a series of posts by Mayur Tendulkar on his Gizmos and Geeks blog, and we are reprinting selected posts here with permission.
Unknowingly in our day-to-day life, we use many devices. Right from Microwave Oven/Electric Stove, Mixer/Grinder, Heater/Geyser, Refrigerator, TVs, Calculators, Cameras, Mobile Phones and what not. And surprisingly – all of these are embedded devices 🙂
Welcome to the world of Mobile and Embedded Devices. In this world, we’re going to get introduced to embedded systems and how we can write software applications which will run on these systems. Imagine, having a device at home, which will obey your orders – say, switch off Mains Supply, Switch off Gas Supply OR as soon as I enter – open the garage door!
Yes, we can do it very well, using embedded systems.
An embedded system is a system (hardware + software combo) which is designed to perform a particular task. Unlike our desktops, which can be used for gaming, business analysis, documentation, software development, entertainment or any other task, embedded systems are built to execute a particular function. Just like cameras are used for photography and not for listening to music, while MP3 players are good for listening music & not for taking pictures.
Sometimes, these embedded systems are categorized as:
Hard Real-Time Systems : In these type of embedded systems, every second is important. If some action needs to be taken at a particular time – then it has to. Example of this system can be controller in atomic station – where, if it doesn’t operate at specified time, there can be a major havoc. Another example can be a pacemaker, which monitors patient data. If it shows data with delay of few seconds, the life of the patient will be at toss.
Soft Real-Time System : With these types of embedded systems, its totally okay if there is short delay in response – but there should be response. For example, toaster, if there is short delay, perhaps, toast will burn-out, but its okay. We can put another bread into it. But we can’t use Soft-Real Time systems in atomic station or to monitor patient data.
Just like computers, where we need Operating System or software to communicate with the hardware, we need some software which will run on-top of this embedded system and will provide its control to us. Otherwise how it will understand that – I’m at the door and that system needs to open the door. How?
For this reason, we need to program a software which will run and sit on top of this embedded system and will provide communication mechanism between end-user and system.
Hence, building or designing an embedded system mainly involves two parts:
Designing of a Hardware
Designing of a Software for that Hardware (which will include Operating System, Drivers, etc…) & sometimes, if required, it also includes building specialized applications which run on these embedded operating systems.
In ensuing blog-posts we’ll get to know about these technologies and will cover Windows Mobile development in depth.
Happy Coding 🙂
About the Author – Mayur Tendulkar
Mayur Tendulkar is a student doing his 2nd Year in Electrical Engineering and a Microsoft Student Partner Lead. He likes coding applications (hmm some what), biking, trying out gizmos, doing night-outs… Basically so many things that STUDENTS enjoy. You can follow him on twitter.
Here is a story about a packet of ‘Star Glucose Biscuits’ in ‘SuperMart’ on FC Road in Pune, told from the point of view of Supply Chain Management. Buckle up your seat belts because this story has tension, drama, emotion, and suspense (will the biscuits reach the shops in time for the T20 World Cup Promotion?)
Overview
The story begins at the Star Biscuits Factory in Bangalore where flour, sugar and other raw material are converted to the finished cases of biscuits. From Bangalore, the biscuits are shipped to a regional Distribution Center on the outskirts of Pune. This center then ships the biscuits to the local depots in different parts of cities such as Mumbai, Pune and from there they ultimately end up at the neighboring retail store, such as SuperMart on FC Road, Pune. In this seemingly simple journey are hidden a host of difficult business decisions and issues that arise on a daily basis. And to complicate matters further, we will throw in a few ‘interesting’ challenges as well! Throughout this story, we will take a deeper look at how the various business processes, and software programs associated with planning this entire supply chain network work in concert to bring you the extra energy and extra confidence of Star Glucose Biscuits.
This chain, from the raw materials all the way to the finished product sitting on the retail shelves is called the supply chain, and managing it efficiently is called supply chain management. Supply chain management is one of the most important aspects of running a manufacturing business, and doing it well has been the key to the phenomenal success of such giants as Walmart and Dell. The basic conflict that SCM is trying to tackle is this: you must have the right quantity of goods at the right place at the right time. Too few biscuits in the store on Sunday, and you lose money because have to turn customers away. Too many biscuits in the store and you have excess inventory. This is bad in a number of ways: 1. It eats up shelf space in the store, or storage space in your warehouse. Both of these cost money. 2. Your money, your working capital is tied up in excess inventory which is sitting uselessly in the warehouse. 3. If the biscuits remain unsold, you lose a lot of money. The same trade-off is repeated with intermediate goods at each step of the supply chain.
The Supply Chain in detail
Schematic of a supply chain. From bottom to top: multiple suppliers supply raw materials to multiple factories. Finished goods are then sent to regional distribution centers. From there it goes to smaller regional depots, and finally to individual stores.
At the Star Biscuit factory in Bangalore, they are gearing up to meet forecasted production requirements that were recently communicated by the Star Biscuits headquarters (HQ) in Mumbai. This is the ‘demand’ placed on this factory. These production requirements consist of weekly quantities spread over next 12 weeks. The factory planning manager now has to plan his factory to meet these requirements on time.
Let us see what all he needs to take into account. First, he needs to figure out the raw material requirements – wheat flour, oil, sugar, flavors, etc. as well as packaging material. Each of them has different procurement lead-times and alternative suppliers. He needs to pick the time to place orders with the right suppliers so that the material is available on time for the manufacturing process.
The manufacturing process itself consists of two primary steps – making the biscuits from the flour, and packaging the biscuits into individual boxes and cases. Typically, multiple parallel making and packing lines work together to achieve the desired output. The packing process scheduling is often complicated further by a series of different sizes and packaging configurations.
Ensuring that the right amount of material is available at the right time is called Material Requirements Planning (MRP), and in the old days, that was good enough. However, this can no longer be done purely in isolation. Even if the amounts of the different raw materials required are predicted precisely, it can be problematic if the various making and packing machines do not have the capacity to handle the load of processing the raw materials. Hence, another activity, called capacity planning, needs to be undertaken, and the capacity plan needs to be synchronized with the materials requirement plan, otherwise excess raw material inventory will result, due to sub-optimal loading of the machines and excessive early procurement of raw material. Excess inventory translates to excess working capital cash requirement; which in the current hyper competitive world is not good! Luckily, today there are sophisticated APS (Advanced Planning & Scheduling) software tools that are far superior to traditional MRP systems that enable him to simultaneously do material and capacity planning.
Happy with the production plan for the next 12 weeks, the factory planner then makes sure that individual making and packing lines have their detailed production schedules for the next two weeks. The finished cases leave his factory on truck loads. But where do they go from here? The journey to SuperMart where our customer wants to purchase the final product is still far from over!
The next stop is a big distribution center (DC) for the western region that sits on the outskirts of Pune. This distribution center is housed in a large warehouse with multi-level stacking pallets (each pallet contains multiple cases) of multiple different products from the manufacturer. A set of conveyors and fork-lifts enable material to flow smoothly from inbound truck docks to stocking area, and from the stocking area, to the outbound truck docks. These products come not only from our Star Biscuits factory in Bangalore, but from various other Star Biscuits factories located all over India. In fact, some of these products could also be directly imported from the parent company of Star Biscuits in the UK (the ones with the bitter, dark chocolate!). This Pune distribution center stocks and stores this material in proximity to the western region – with specific emphasis on the large Greater Mumbai and Pune markets. How are all these warehousing related activities smoothly managed? The DC manager takes full advantage of a Warehouse Management System Software (WMS). The truck loading and load containerization is managed by a Transportation Management Module.
From here outbound shipments are sent to smaller regional depots that are located in the cities, nearer to the stores. From these depots, the biscuits are finally shipped to the stores to meet the end customer demand. How is this demand calculated? Clearly, it is impossible to predict the demands coming from individual customers at the store, few weeks in advance! Hence it is necessary to ‘forecast’ the demand.
Forecasting demand and determining stock levels
Who decides how much material to stock? And how is it calculated? Clearly, as we briefly indicated earlier, keeping too much product is costly and keeping too little results in stockouts (material unavailability on store shelf) at the stores, thereby resulting in unhappy customers and lost sales. Too much product equals excess working capital (similar to the excess raw material problem) and is not good for the company’s financial performance. Too little, and we will run out if there are any major demand swings (commonly referred to as ‘demand variability’). To achieve the optimum level of the desired stock on hand to buffer against demand variability a ‘safety stock quantity’ is maintained in the warehouse. This quantity is computed by the central Supply Chain Management (SCM) team at HQ.
The actual computation of the safety stock for different products in the distribution center is calculated using a statistical computation (In some cases, a manual override is also done over the computed value). The most common technique consists of using Poisson distribution, demand & supply variability historical data, demand & supply lead time data, and desired customer service levels. Customer service levels are assigned based on an “ABC” classification of the products. ‘A’ category items are the fast movers and have a high revenue share and are typically assigned a 99% customer service level. Roughly speaking, a ‘99%’ customer service level implies that the safety stock quantity is adequate to guard against demand variability signals 99 times out of 100. Proactive planning on a daily basis that involves daily monitoring of stocks of all products is done, based on actual outbound shipments, can many times help in even reacting to that ‘1 in 100’ cases with rapid corrective measures.
The forecasting process for all the products is done at Star Biscuits Head Quarters. Let us continue with our example of ‘Star Glucose Biscuits’. The modern forecasting process is more accurately referred to as a ‘Demand Planning’ process. Statistical forecast is one input to the overall process. Statistical forecasts are derived from shipment history data and other input measures such as seasonality, competitor data, macro-economic data, etc. Various statistical algorithms are used to come up with a technique that reduces the forecasting error. Forecasting error is typically measured in ‘MAPE’ (Mean Absolute Percentage Error) or ‘MAD’ (Mean Absolute Deviation).
The statistical forecast is then compared with the sales forecast and the manufacturing forecast in a consensus planning process. This is often done as part of a wider ‘Sales & Operations Planning Process’ in many companies. Often times, a ‘top-down’ and ‘bottom-up’ forecasting technique is used. Here, individual forecasts at the product level are aggregated up the product hierarchy into product group forecasts. Similarly, aggregate product group level forecasts are disaggregated down the same hierarchy to the individual product level. These are then compared and contrasted and the expert demand planner then takes the final decision. Aggregated forecasting is important, since often times this reduces the forecast error. In case of Star Glucose Biscuits, the aggregated product hierarchy would first combine all sizes (e.g. 100 gm, 200 gm), then aggregate along sugar based biscuits type, and then into ‘All biscuits’ groups.
The end result of the demand planning process is the final consensus forecast that is calculated in weekly time intervals (commonly referred to in planning terminology as ‘buckets’) for a time horizon of 8-12 months. The demand forecasts drive the entire Star Biscuits Supply Chain. To simplify the overall Demand Planning process, modern DP software tools provide great help in statistical forecasting, OLAP based aggregation/disaggregation, and in facilitating interactive collaborative web-based workflows across different sets of users.
Managing the Supply Chain
It was easy if all we had was one DC in Pune and one factory in Bangalore, supplying to one store. But Star Biscuits has a much more extensive network! They have multiple factories throughout India and the same biscuits can be produced by each factory. How much of the demand to allocate to which factory? This problem is addressed by the Supply Chain Management (SCM) team that works in close concert with the Demand Planning team. The allocation is made based on various criteria such as shipment times, capacities, costs, etc. In coming up with the sourcing, transportation and procurement decisions – minimizing costs and maximizing customer service are amongst the top business objectives.
Now, getting back to Star Biscuits, they have over 300 products across 5 factories and 4 DCs. The DCs in turn, receive demand from nearly 100 depots that are supplying to thousands of stores all over India. Determining the optimal allocation of demands to factories, safety stocks to DCs and all the transportation requirements is beyond the abilities of humans. Such a complicated scale and decision problem needs computer help! Luckily, advanced SCM software tools can help the SCM team make these decisions fairly efficiently. Good SCM tools allow user interactivity, optimization, and support for business specific rules & heuristics. The SCM process thus determines the 12 week demand in weekly buckets for our factory in Bangalore, where we started.
To summarize, the overall supply chain – we saw how the product demand gets forecasted at HQ by the demand planning group. The SCM group then decides on how to allocate and source this demand across the different factories. They also decide on the ideal safety stock levels at the DCs. The WMS group ensures the efficient management of the distribution center activities. The factory planner team decides on the most efficient way to produce the biscuits demand allocated to their plant. The transportation management team is assigned the task of shipping material across this network in the best possible way to reduce cost and cut down on delivery times.
Dealing with drastic changes
And all of this is just to do “normal” business in “normal” times.
All the processes described earlier are great if the business works at a stable, reasonably predictable pace. Our safety stock policies guard against the day to day variability. But what about drastic changes? Unfortunately in the current environment, the only thing that is constant is ‘change’.
Here is what happened at Star Biscuits. One day, out of the blue, the entire planning team was thrown into a mad scramble by a new request from the marketing department. In order to react to a marketing campaign launched by one of their top competitors, the marketing department had a launched a new cricket promotion of its own for the next month.
Promotions are extremely important in the consumer goods industry. They entail targeted customer incentives, advertising spending and custom packaging – all in a synchronized fashion. The success of promotions often times make or break the annual year performance of a Consumer Goods Company. Promotions driven sales often times contribute large double digit percentage of total sales of consumer goods companies.
This particular cricket promotion involved a special packing requirement with the star logos on the packet. The target customer demand was not only upped by 50%, the offer also had a ‘Buy 1 Get 1 Free’ incentive. As a result, the total demand was going up by nearly 300%.
The SVP in charge of Supply Chain was trying his best to get a handle of the problem. He was getting irritated by the constant pressure he was under from the SVP Marketing, and the CEO.
The demand planning team had to quickly alter its demand numbers to meet the new targets. The real trouble spot was brewing at the SCM team. The team had to rapidly make decisions on where to source this sudden demand spike. While cost optimization is important, meeting customer demand at ‘all costs’ is the key. The Bangalore factory was already running at 90% capacity and was in no position to produce much more. Luckily for the SCM team, their SCM tool quickly ran a series of scenarios and presented possible alternatives. These scenarios looked at various alternatives such as contract packing, new factories, expedited raw material shipments, direct shipments from the factories to the stores, etc. One of the resulting scenarios seemed to fit the bill. It was decided that bulk of the extra demand be routed to the alternative factory in Faridabad which had some spare capacity. From here, the product was going to be shipped directly (where feasible) to the Mumbai and Pune depots, where a large chunk of the promotion driven demand was expected. The rest of the country’s demand was going to be met by the conventional approach, from the Bangalore factory. The new package also resulted in demand for new packaging material with the cricket logos. New scenarios were generated that source this material from packaging material suppliers from the middle-east. (Interesting to note, that in some time crunched promotions, packaging material often times ends up being the bottle neck!)
Satisfied with this approach, the SVP Supply Chain ordered his team to come up with process improvements to prevent such scrambles in future. Luckily there was an easy solution. The Demand Planning software tool had a nice capability to support an integrated promotions planning & demand planning workflow. Such workflows look at various promotions related data, such as timing, costs, volume, competitor strategies and efficiently plan future promotions – instead of reacting to them at the last minute. In turn, such effective promotion planning can not only drive revenues, but also further improve supply chain efficiencies.
The SVP is happy, but what happened to our end customer on FC Road Pune? Well, she walked away happy with her promotion pack of Star Glucose biscuits, completely oblivious of what had happened behind the scenes!
About the Author – Amit Paranjape
Amit Paranjape is one of the driving forces behind PuneTech. He has been in the supply chain management area for over 12 years, most of it with i2 in Dallas, USA. He has extensive leadership experience across Product Management/Marketing, Strategy, Business Development, Solutions Development, Consulting and Outsourcing. He now lives in Pune and is an independent consultant providing consulting and advisory services for early stage software ventures. Amit’s interest in other fields is varied and vast, including General Knowledge Trivia, Medical Sciences, History & Geo-Politics, Economics & Financial Markets, Cricket.
If you’ve been following the tech scene in Pune, you’d be aware of the tremendous success of PHPCamp Pune with over a 1000 registrants. One thing that quickly became clear during PHPCamp is the interest in having special interest groups for more specialized areas within PHP hacking – specifically Open Social, Drupal and Joomla!. To help you stay in touch, we asked Amit Kumar Singh, one of the primary movers behind PHPCamp, and behind the Joomla Users Group, India to give our readers an overview of Joomla! – what it is, and why is it so popular. This article is intentionally low-tech at our request – to give people just an quick overview of Joomla! If you want more details, especially technical deep dives, head over to Amit’s blog where he often has articles about Joomla!
Have you ever wondered how you can quickly build a website for yourself or your organization? If yes, then read on to find how you can do so.
What is Joomla!
Joomla! is a open source, content management system( CMS), written in PHP, licensed under GPL and managed by OSM Foundation .
Joomla is the English spelling of the Swahili word jumla meaning “all together” or “as a whole”. You can read more about history of Joomla at wikipedia.
Well, in one word, secret to build websites quickly and easily is Joomla!. It takes the pain out of building and maintaining websites. It is designed and build to make managing websites easier for a layman.
Where to use
It can be used to build
Personal Websites
Company’s Website
Small Business Websites
NGO Websites
Online magazines and publications websites
School and colleges Websites
This is basically list of things that can be done with Joomla out of box. Some of the core features of Joomla are
Article management
User registration and contacts
Themes
Search
Polling
Language support
Messaging
News Feeds and advertisement
If you need more, then you can easily extend Joomla to do lot more things and even use the framework to build some powerful applications. For example if you want to add additional fields to user registration form you can use community builder, if you want to put e-commerce shopping cart you can use vituemart, if you want to add forum you can use fireboard.
For me the best part of using Joomla is that it is very easy to customize and enhance. You can find extensions for your needs by simply looking in JED, just in case your need is really very unique then you can extend Joomla to suit your specific needs by writing simple components and modules.
If you get stuck while building something you can always find help from very active and helpful community members either at main Joomla Forum site or at Joomla User Group Pune.
(In this article, Manas Garg, a regular contributor to PuneTech, explores the various factors involved in the growth of a community powered wesbite. These ideas are relevant to any website/company that expects to get a lot of its content from the actions of its users – and there are a number of such sites from SadakMap, and JustMeans to the Pune OpenCoffee Club, and of course, PuneTech itself. Even otherwise, these are important issues that any technologist living in a web-2.0 world must understand.)
Community Powered Websites (CPWs) are a rage today. And there are good reasons for that. First, you only build a website and the content (which is the primary value to these sites) comes from people. These people don’t charge you anything, in fact, you can make some money by running ads to these very people.
Secondly, the people who bring in the content also become the users of the website. Which means, people bring the content, people consume the content, and you just provide a framework for doing that using a website. Great!
Two primary factors contributing to the success of a Community Powered Website (CPW) are its tendency to grow and its immunity to abuse. This is, of course, in addition to the functional value that this website has.
Growth for a CPW means, more data, more contributors and more users. Simple. And immunity to abuse means when bad people come to your site to do bad things, your site can shrug off these attacks and get on with life. For Wikipedia, a bad thing is someone putting spam on a page. For twitter, a bad thing is someone hacking the system and making thousands of people follow him/her.
In this article, I have put down some of my thoughts on how we can make a CPW “tending to grow”. I do not claim expertise in this area. Nor do I claim to be exhaustive. I am just trying to make sense out of the way web is evolving today and community power is a very interesting phenomenon in that.
So, let’s start…
For any CPW, we anyway have to do things which people find valuable/useful and for which they would want to use the website in the first place. For instance, facebook, delicious, twitter, wikipedia have some fundamental value for which people would like to use them. On top of that functional value, there is a social design which makes them “tending to grow”.
A simple example is Blogger. It has some functional value (i.e. a blogging platform) for which people use it. But as long as the game is purely functionality based, people will choose Blogger only if its functionality is the best. Tomorrow, if a new blogging platform with better functionality comes along, new blogs may use that platform. That’s the reason blogger team is adding some social touch so that more and more people “choose” blogger if their contacts are already on blogger.
So, this is the “tendency to grow”. It is outside the purview of functionality. And it’s becoming more and more important because it’s becoming very easy for anyone to match a given set of functionality.
Now, let’s look at the contributors to this “tendency to grow”…
The Network Effect
In short, network effect is when a service becomes more and more valuable when more and more people use it which thereby increases its adoption and hence the value. This creates a self sustaining loop. The loop doesn’t go infinite as eventually there is a max limit to the final value. But it can certainly take us very far.
The general purpose social networking sites are the best examples of network effect. More the users we have, more the chances of getting more users. That’s why they have grown phenomenally in a short time span. Delicious doesn’t trigger the network effect even though it is social. There is no reason for me to join delicious even if all my friends are using it. On the other hand, I would naturally join LinkedIn because all my “connections” are using LinkedIn. Blogger, by being more social, is trying to bring in the network effect.
How to bring in the network effect is a subject worth another complete article or may be a book. Suffice it to say that a network effect has to be designed for in any CPW. Once we have modeled our website, we can test that model (mentally of course) for what kind of network effect this model can produce. If we are building a CPW but don’t design it for network effect, we are limiting the mileage we can get out of it.
Ease of contribution
It’s difficult to have a general purpose definition of what contribution is as it depends on the website. For flickr, photographs are contributions, for facebook, pretty much everything a user does on the site is a contribution. Even visiting someone’s profile on facebook is a contribution to facebook as the very fact that you visited that profile is shown on that profile.
On every Wikipedia page, you’ll see a clear “Edit” link to edit that page. For every section within the page, the edit link for that section is well placed. It almost “invites” you to edit. When the very design of a website has a look that invites you for contributions, it’s got the tendency to growth 🙂
For receiving contributions, there are two possibilities –
Unintentional contribution. We contribute bookmarks to delicious for our own purpose. We contribute photographs to flickr for our own purpose. While we are doing our own things, unintentional contributions are being made to the system. When we share something with our friends on facebook, the system is getting richer automatically even though the users are not working towards making the system richer 🙂
Intentional contribution. Wikipedia is a place where people specifically contribute with the intention of making the system richer. It’s not like sharing something with friends or saving something for future reference. There is an explicitness here.
Needless to say, it’s easier to get people on board when their contribution is unintentional i.e. they are doing their own thing and the system just gets richer. This lends a greater tendency to grow to the CPW.
I am sure there would be several other aspects of making a CPW tending to grow which escaped my limited knowledge and the retarded mind. Will some people with experience in this area throw a little bit of light here?
About the Author – Manas Garg
About the author: Manas is interested in a variety of things like psychology, philosophy, sociology, photography, movie making etc. But since there are only 24 hours in a day and most of it goes in sleeping and earning a living, he amuses himself by writing software, reading a bit and sharing his thoughts.
Last week, SICSR (Symbiosis Institute of Computer Studies and Research) hosted GNUnify, a conference on open source technologies, which attracted hundreds of students and other open source enthusiasts. Shirish has written a couple of posts on his blog about the talks he attended – read those to get a flavor of GNUnify (day 1, day 2). Usually, the presentations and discussions revolve mostly around the technology, but I decided to talk about not the technology, but about the economics of open source in particular, and free stuff in general.![Reblog this post [with Zemanta]](http://img.zemanta.com/reblog_b.png?x-id=592a2184-5439-4e1d-be5f-17e9bc6d8309)
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