OPERATIONS

RESEARCH
SUBMITTED TO,
MAHMUDUL HASAN FOUJI
ASSISTANT PROFESSOR
DEPT. OF MARKETING
JAGANNATH UNIVERSITY

A REPORT ON
CONTEMPORARY
OPERATIONS
RESEARCH
PRACTICES IN
BANGLADESH

SUBMITTED BY;
GROUP: PHOENIX
3rd 2nd SEMESTER
6th BATCH
DEPT. OF MARKETING
JAGANNATH UNIVERSITY

Group Name: PHOENIX

Sl
No
1

Name

ID Number

Mobile

Email

Md. Fahad Al
Mamun

016852949
75

fahad.phoenix11@gmail.c
om

SaifuddinZubair

016837621
33

zubair0702@yahoo.com

ShahedurRahman
Emon

016811961
60

semon_shahed@yahoo.co
m

NafeesKauser

019119491
64

nafees.kausar404@gmail.
com

KhandakarArifHos
sain

016749042
02

arifhossainxy@yahoo.com

Nilakshmi Das

016823969
54

nilaxmidas@yahoo.com

IkramurRahman

016760286
20

ikram_962@yahoo.com

Fida Al Hasan

016755468
84

fahshoumo@gmail.com

DebasisBasu

016753024
54

debasisbasu14@yahoo.co
m

10

ImtiazHossain

B11020401
3
B11020401
4
B11020402
6
B11020403
7
B11020403
8
B11020405
8
B11020406
2
B11020407
8
B11020409
5
B- 115482

016726022
11

imtiaz_ibuu@gmail.com

Executive summary
This report is a critical analysis of the various contemporary practices in the perspective
of Bangladesh. This report was prepared through conducting an interview with the
Deputy General Manager of Matador Mr. Tanvir Ahmed and the gatheredinformation
were used in collaboration of the relevant aspect with the legal permission of the related
authority.
This report discusses the various implication of supply chain management and inventory
management that are relevant to the operation management practice in Bangladesh. It
also contains illustrative presentation of operation management practices of Matador.
The findings of the report indicates that matador has a state of the art supply chain
management and inventory management implications that makes the organization to
sustain in the competitive market and be the market leader in the market. Some
limitations ad their probable solution hasalso been prescribed in the report. The findings
also shows that the supply chain management and inventory management of Matador is
efficient enough to ensure profitability and flexibility.

Table of Contents
Introduction:.......................................................................................................................3
1. An Overview of Operations Research...........................................................................4
2. Mainstream of Operations Research Application..........................................................5
3. Why Operations Research is important for the Organizations?....................................7
4. Constraints and opportunities of Operations research in Bangladesh..........................8
Opportunities of operation research in Bangladesh.......................................................8
Constraints of operation research in Bangladesh..........................................................9
5. Styles of Inventory Management in Operation Research Practices..............................9
6. Methods and Vital issues of Supply Chain Management............................................12
7. A brief about the Matador Ball Pen Industries Bangladesh.........................................15
8. Practices of relevant inventory style in case of Matador Ball Pen Industry.................16
Practices of relevant inventory style in case of Matador..............................................16
9. Supply Chain Practices of Matador Ball Pen Industry.................................................19
10. Limitation and constraints faced by the Matador Ball pen Industry...........................24
11. Recommendation for Matador Ball pen Industry to eradicate the constraints..........24
12. Conclusion.................................................................................................................25
13. Reference..................................................................................................................26
14. Appendix:...................................................................................................................27

Introduction:
This report is the assessment of contemporary operation management practices in the
perspective of Bangladesh. The report choose the market leader in the Ball pen industry
of Bangladesh, Matador Group and analyzed the entire aspect of operation management.
This report contains comprehensive elaboration of the two major aspects, supply chain
management and inventory management practices that can be linked with the operation
management practices in Matador. Through evaluation of the essential elements of the
inventory an supply chain management of matador it indicates some limitations and
enlightens with some proper recommendation that can enhance the credibility of Matador
and ensure finest potential in future prospect.

1. An Overview of Operations Research.

Operations research, or operational research in British usage, is a discipline that deals
with the application of advanced analytical methods to help make better decisions. It is
often considered to be a sub-field of mathematics.The terms management
science and decision science are sometimes used as synonyms.
Employing techniques from other mathematical sciences, such as mathematical
modeling, statistical analysis, and mathematical optimization, operations research arrives
at optimal or near-optimal solutions to complex decision-making problems. Because of
its emphasis on human-technology interaction and because of its focus on practical
applications, operations research has overlap with other disciplines, notably industrial
engineering and operations management, and draws on psychology and organization
science. Operations research is often concerned with determining the maximum (of
profit, performance, or yield) or minimum (of loss, risk, or cost) of some real-world
objective. Originating in military efforts before World War II, its techniques have grown
to concern problems in a variety of industries (Winston 2007 pp. 277).

Operational research (OR) encompasses a wide range of problem-solving techniques and

methods applied in the pursuit of improved decision-making and efficiency, such
assimilation, mathematical
optimization, queuing
theory and
other stochasticprocess models, The major sub disciplines in modern operational research, as identified
by the journal Operations Research (Taylor 2000), are:

Computing and information technologies

Financial engineering

Manufacturing, service sciences, and supply chain management

Marketing Engineering

Policy modeling and public sector work

Revenue management

Simulation

Stochastic models

Transportation

2. Mainstream of Operations Research Application.

The mainstream operation management practices that are applicable in case of the general
industries of Bangladesh they are described in the following. These are the basic
application of various implication of operation management practices within an
organization.
Linear programming

Linear programming (LP) refers to a family of mathematical optimization techniques that

have proved effective in solving resource allocation problems, particularly those found in
industrial production systems. Linear programming methods are algebraic techniques
based on a series of equations or inequalities that limit a problem and are used to
optimize a mathematical expression called an objective function. The objective function
and the constraints placed upon the problem must be deterministic and able to be
expressed in linear form (Mahadevan 1995).
Inventory control

Inventories include raw materials, component parts, work in process, finished goods,
packing and packaging materials, and general supplies. The control of inventories, vital to
the financial strength of a firm, in general involves deciding at what points in the
production system stocks shall be held and what their form and size are to be. As some
unit costs increase with inventory sizeincluding storage, obsolescence, deterioration,
insurance, investmentand other unit costs decrease with inventory sizeincluding
setup or preparation costs, delays because of shortages, and so fortha good part of
inventory management consists of determining optimal purchase or production lot sizes
and base stock levels that will balance the opposing cost influences (Kapoor 2001).
Replacement and maintenance

Replacement problems involve items that degenerate with use or with the passage of time
and those that fail after a certain amount of use or time. Items that deteriorate are likely to
be large and costly (e.g., machine tools, trucks, ships, and home appliances). No
deteriorating items tend to be small and relatively inexpensive (e.g., light bulbs, vacuum

tubes, ink cartridges). The longer a deteriorating item is operated the more maintenance it
requires to maintain efficiency. Furthermore, the longer such an item is kept the less is its
resale value and the more likely it is to be made obsolete by new equipment (Taylor
2000).

Queuing

A queue is a waiting line, and queuing involves dealing with items or people in sequence.
Thus, a queuing problem consists either of determining what facilities to provide or
scheduling the use of them. The cost of providing service and the waiting time of users
are minimized. Examples of such problems include determining the number of checkout
counters to provide at a supermarket, runways at an airport, parking spaces at a shopping
center, or tellers in a bank (Bliss 2007).
Job shop sequencing

In queuing problems, the order in which users waiting for service are served is always
specified. Selection of that order so as to minimize some function of the time to perform
all the tasks is a sequencing problem. The performance measure may account for total
elapsed time, total tardiness in meeting deadlines or due dates, and the cost of in-process
inventories.The most common context for sequencing problems is a batch, or job shop,
production facility that processes many different products with many combinations of
machines (Winston 2007)
Network routing

A network may be defined by a set of points, or nodes, that are connected by lines, or
links. A way of going from one node (the origin) to another (the destination) is
called a route or path. Links, which may be one-way or two-way, are usually
characterized by the time, cost, or distance required to traverse them. The time or cost of
traveling in different directions on the same link may differ. Network routing problem
consists of finding an optimum route between two or more nodes in relation to total time,
cost, or distance. Various constraints may exist, such as a prohibition on returning to a
node already visited or a stipulation of passing through every node only once.

3. Why Operations Research is important for the Organizations?

Operations research applies sophisticated statistical analysis and mathematical modeling
to solve an array of business and organizational problems, as well as improve decisionmaking. As the business environment grows more complex, companies and government
agencies rely on analysis to inform decisions that were once based largely on
management intuition.
Simplifying Complexity
Modern challenges associated with a global economy and the growth of technology have
increased the complexity of the business environment. Modern corporations often strive
to serve a global, rather than a regional or national, customer base and face worldwide
competition. By relying on sophisticated mathematical models and advanced software
tools, operations research can assess all available options facing a firm, project possible
outcomes and analyze risks associated with particular decisions. The result is more
complete information on which management can make decisions and set policy,
according to the Institute for Operations Research and the Management Sciences,
INFORMS for short, a national organization of operations research professionals (Bhalla
2001)
Maximizing Data
Companies collect large amounts of data but may feel overwhelmed by the volume and
lack the time or expertise to fully analyze these data, transforming them into useful
information on which to base decisions. Operations research uses advanced mathematical
and statistical techniques, such as linear programming and regression analysis, to help
organizations make the most of their data, according to INFORMS' Science of Better
website. Through detailed analysis of the data, operations research analysts can help
uncover options that lead to higher profits, more-efficient operations and less risk
(Kapoor 2001).
Adding Value
In its executive guide to operations research, "Seat-of-the-Pants-Less," INFORMS reports
that operations research has added value to organizations in the public and private sector
alike. For example, INFORMS reported that UPS used operations research to redesign its
overnight delivery network in such a way that saved more than $80 million between 2000
and 2002. Meanwhile, New Haven, Connecticut, used operations research to determine
the extent to which the city's needle exchange program reduced HIV infection rates (Buff
2005).

Considerations
INFORMS outlines five signs for organizations that could benefit from operations
research. These indicators are facing complex decisions, having problems with processes,
having trouble with risk, not making the most of available data and needing to overcome
stiff competition. Operations research analysts can help organizations overcome these
challenges.

4. Constraints and opportunities of Operations research in Bangladesh.

Opportunities of operation research in Bangladesh
From our brief research we have reached the conclusion is that the following mentioned
aspects are the opportunities for the operation management practices in the perspective of
Bangladesh. According to some perspective, the aspects are elaborated below:
Product selection and design:
The product mix makes our system efficient or inefficient. So it is very important to
select right product keeping the mission and overall objectives in mind. Design is the
most important thing as it makes us competitive or non-competitive and we use operation
management to find suitable design to fulfill our requirement with controlled cost.
Process of handcrafting products or services for individual customer in Bangladesh can
be more effective by following operation research.
Division of labor:
Dividing a job into a series of small tasks each performed by a different worker. Workers
working schedule, working pattern sorting according to their eligibility can be done by
operation management.
Mass production:
High volume production of a standardized product for a mass market. Every year a very
large number of readymade garments need to export to the foreign market. For
contributing in this sector there need a mass production and a proper management of the
production. Operation management make this easier.

Constraints of operation research in Bangladesh

In spite of [profound opportunities there are various limitations and constraints faced in
implication of the practices of operation management. The limitations are mentioned in
the following:
Scientific management: Systematic analysis of work methods cannot be done in
some organization in our country for some lacking of scientific development.
Interchangeable parts: Standardization of parts initially as replacement parts,
enabled mass production may create contains for operation management in
Bangladesh.
Process selection and planning: Selection of process involves taking decisions
about technology, machines, and equipment. We have to optimize the output from
a given process. And thats may be caused as constraints of operation research in
Bangladesh.
Less Expertise: the eminent absence of expertise in te field of operation research
is a prominent limitation in the aspect. Due to the lack of expertise the practices
are often subject to faulty ad impractical decision making.

5. Styles of Inventory Management in Operation Research Practices.

Business must have methods and procedures that offer ample flexibility to meet unusual
and sometimes unreasonable demands on their resources -- personnel, equipment,
facilities and operational. Exceptional customer service also includes providing top
quality products at reasonable costs.
Businesses must keep a careful rein on their inventories. Having too much inventory
and/or not having enough stock is considered primary direct causes of business failures.
Properly managing inventory requires a system of some sort. It doesnt matter if the
system consists of writing inventory levels on the back of an envelope or using the most
sophisticated radio frequency identification system. The different types of inventory
management systems all have pros and cons (Russel 2011).

Manual:
Many entrepreneur, especially if the business has very few products, keep track of
inventory manually. The easiest way to perform manual inventory management is to use a
spreadsheet. For example, a small bakery might use a spreadsheet to keep track of
inventory purchases and usage. The owner can also set up the spreadsheet to calculate
when ingredients need to be reordered. Manual systems allow the small business owner
to manage inventory with very little investment in systems or training. Maintaining data
integrity is a major downside to managing inventory using a spreadsheet. A single data
entry or formula error can cause major inaccuracies in the data output (Mahadevan 2005).

Barcode:
Inventory management systems that use barcode technology increase the accuracy and
efficiency of managing inventories. All major retailers use barcode technology as part of
an overall inventory management program. When a barcode gets read at the point-of-sale
(the computerized cash register), inventory sales data are immediately read to a broader
system that maintains usage statistics. The companys purchasing department uses these
data to make buying decisions based on sales and existing inventory levels.
Barcodes also manage inventory at the warehouse level. Most warehouses use barcode or
radio frequency identification (RFID) to scan incoming inventory into the warehouses
inventory management or warehouse management software (Winston 2001).

Radio Frequency Identification:

While barcode technology has done a lot to increase the accuracy and efficiency of
managing inventory, radio frequency identification (RFID) has raised the bar on
inventory management. Companies that use RFID typically move thousands of pieces of
inventory through their doors. RFID uses two types of technology to manage inventory
movements--active and passive technology.
Active RFID technology uses fixed tag readers assigned throughout a warehouse.
Anytime an item with an RFID tag passes the reader, the movement of the item is
recorded in the inventory management software. Active systems work best in
environments that require real-time inventory tracking or where inventory security
problems exist (Kapoor 2000).

ABC Method:
In order to facilitate this, many firm's use an ABC approach. ABC analysis is based
on Pareto Analysis, also known as the "80/20" rule. The 80/20 comes from Pareto's
finding that 20 percent of the populace possessed 80 percent of the wealth. From an
inventory perspective it can restated thusly: approximately 20 percent of all inventory
items represent 80 percent of inventory costs. Therefore, a firm can control 80 percent of
its inventory costs by monitoring and controlling 20 percent of its inventory. But, it has to
be the correct 20 percent (Chary 2004).
The top 20 percent of the firm's most costly items are termed "A" items (this should
approximately represent 80 percent of total inventory costs). Items that are extremely
inexpensive or have low demand are termed "C" items, with "B" items falling in between
A and C items. The percentages may vary with each firm, but B items usually represent
about 30 percent of the total inventory items and 15 percent of the costs. C items
generally constitute 50 percent of all inventory items but only around 5 percent of the
costs.
By classifying each inventory item as an A, B or C the firm can determine the resources
(time, effort and money) to dedicate to each item. Usually this means that the firm
monitors A items very closely but can check on B and C items on a periodic basis (for
example, monthly for B items and quarterly for C items).
Attributes of inventory management in Operations Research Practices.

6. Methods and Vital issues of Supply Chain Management.

The best companies around the world are discovering powerful new source of
competitive advantage. Itscalled supply-chain management and it encompasses all of
those integrated activities that bring product to market and create satisfied customers.
The Supply Chain Management Program integrates topics from manufacturing
operations, purchasing, transportation, and physical distribution into a unified program.
Successful supply chain management then, coordinates and integrates all of these
activities into a seamless process. It embraces and links all of the partners in the chain. In
addition to the departments within the organization, these partners include vendors,
carriers, third-party, companies, and information systems providers.
If supply-chain management has become top management's new "religion," then it needs
doctrine has stepped forward to provide the needed guidance, espousing what it calls the
"Seven Principles" of supply-chain management. When consistently and
comprehensively followed, these seven principles bring a host of competitive advantages.
The seven principles are as follows (Russel 2005):
a) Segment customers based on service needs. Companies traditionally have grouped
customers by industry, product, or trade channel and then provided the same level
of service to everyone within a segment. Effective supply-chain management, by
contrast, groups customers by distinct service needs--regardless of industry--and
then tailors services to those particular segments.
b) Customize the Supply Chain Management network. In designing their Supply
ChainManagement network, companies need to focus intensely on the service
requirements and profitability of the customer segments identified. The
conventional approach of creating a "monolithic" Supply Chain Management
network runs counter to successful supply-chain management.
c) Listen to signals of market demand and plan accordingly. Sales and operations
planning must span the entire chain to detect early warning signals of changing
demanding ordering patterns, customer promotions, and so forth. This demandintensive approach leads to more consistent forecasts and optimal resource
allocation (Russel 2005).
d) Differentiate product closer to the customer. Companies today no longer can afford
tostockpile inventory to compensate for possible forecasting errors. Instead, they
need to postponeproduct differentiation in the manufacturing process closer to
actual consumer demand.
e) Strategically manage the sources of supply. By working closely with their key
suppliers to reduce the overall costs of owning materials and services, supply-

chain management leaders enhance margins both for themselves and their
suppliers. Beating multiple suppliers over the head for the lowest price is out,
Andersen advises. "Gainsharing" is in.
f) Develop a supply-chain-wide technology strategy. As one of the cornerstones of
successfulsupply chain management, information technology must support
multiple levels of decision making. It also should afford a clear view of the flow of
products, services, and information.
g) Adopt channel-spanning performance measures. Excellent supply-chain
measurement systems do more than just monitor internal functions. They adopt
measures that apply to every link in the supply chain. Importantly, these
measurement systems embrace both service and financial metrics, such as each
account's true profitability. The principles are not easy to implement, the Andersen
consultants say, because they run counter to ingrained functionally oriented
thinking about how companies organize, operate, and serve customers. The
organizations that do persevere and build a successful supplychain have proved
convincingly that you can please customers and enjoy growth by doing so.
The Methodology of a Supply chain Management project- solutions
A Four Step integrated Approach
In view of the importance of Supply Chain Management to commercial success, making
the right decision about which system is best is vital. Before deciding how to develop
new service Supply Chain Management chains and economical distribution centers, many
factors must be considered, such as, the required customer service levels, optimum
location, stock holding policies and EDP systems.
To help organizations make the best decisions, the Miebach Supply Chain Management
Group employs an integrated planning approach, consisting of four steps from planning
to realization:
The integrated planning process helps to find solutions that best match clients
requirements and the technical demands of the problem. The only way to manage the
growing complexity in international Supply Chain Management chains is through the
integration of strategy, engineering and IT systems and methods (Miebach 2004).

Where the Supply Chain Creates Value

Supply chain management's ability to affect profitability and shareholder value should
come as no surprise. As Richard Thompson, a partner in Ernst & Young's supply chain
practice, points out, supply chain management affects virtually every aspect of a
companys business. "Everything is involved," he says. "Supply chain management
[influences] plan-buy-make-move-and-sell. Enhanced revenues, tighter cost control,
more effective asset utilization, and better customer service are just the beginning.
Thompson and his colleagues have identified five areas in which supply chain
management can have a direct effect on corporate value. They include:
Supply chain management contributes to profitable growth by allowing assembly of
"perfect orders," supporting after-sales service, and getting involved in new product
development. The bottom-line numbers give the answer. According to A.T. Kearney's
research, inefficiencies in the supply chain can waste up to25 percent of a company's
operating costs. With profit margins of only 3 to 4 percent, the consultants point out, even
a 5-percent reduction in supply-chain waste can double a companys profitability
(Kearnney 2004). These study includes

Potential analysis
Concept study
Detailed planning
Project or change management

7. A brief about the Matador Ball Pen Industries Bangladesh.

Established in 1998, Matador Ball pen Industries is the largest ball pen manufacturer in
Bangladesh. We are proud to say that we are the largest Disposable Pen maker in ASIA
having a capacity of making 1 million Disposable pens per day. Apart from disposable
pens, we make refillable ball pen and gel pen with various ball diameters and ink colors
to meet our customers' requirements.
Matador has created an uncontested marketplace in Bangladesh through value innovation.
We have redefined the core value of a pen introducing OIL GEL SYSTEM (OGS) and
still developing trendy products innovating various augmented values. Innovative product
development has enabled us to serve some MNCs as well as some reputed local and
international buyers. We are already exporting our pens to Middle East, Africa and some
parts of Asia and Europe.
We use high quality raw materials imported from Germany, Belgium, Korea, China and
India. A highly precise mould, imported from Korea, ensures dimensional accuracy and
flawless finishing of every part of our pens.
In-house packaging material development facility has enabled us to offer OEM
manufacturing within the shortest lead time.
We have 2500 innovative, sincere and hardworking professionals involved in Production,
Finance, HR, Sales & Marketing departments of Matador. They are our most valuable
assets and are responsible for continuous growth for the company as well as for the
country (Matador 2014).

8.Practices of relevant inventory style in case of Matador Ball Pen Industry.

Practices of relevant inventory style in case of Matador
Matador group is aleader in the market that it operates in. matador has the zenith of the
market through its proper management in the related sector of the management within the
organization. The organization has a structure inventory management style throughout its
process of managing the inventory. As noted earlier that there are various relevant
inventory practices within an organization in the perspective of operation management
practices in Bangladesh. The contemporary inventory practices within the organization
are:

APC ni
Sa
tic
fype t
eciylp
aenti
St
Ioonenc
Ivnk
veIne
vnn et
to n r
royy
y

SAanfteictyp Sa ttoiocnk IIn vvee nn ttoorryy

C y c l e In v e n t o r y

P ip e li n e I n v e n t o ry

Figure: Type of Inventory

Among the relevant practices in the contemporary inventory practices in the Bangladeshi
culture of industries there are only few practices are relevant to our chosen organization
the Matador group. The analysis of the inventory practices that are related to the
organization that are given in the following:

Implication of Cycle Inventory in Matador

Cycle inventory a method of keeping track of inventory by performing inventory counts
constantly, or on a frequent and regular basis, instead of once per year or once per quarter.
A businessusing the cycle inventory method might count different items at different rates,
based on the level of turnover or demand for that particular item. In case of the
calculation the lot size of the inventory is used to find out the cycle inventory.
The equation of cycle inventory is:
Cycle Inventory =

Q
2

The cycle inventory of Matador is =

100 metric ton

2

= 50 metric tons
Matador does the calculation of the inventory on the basis of quarterly evaluation of the
inventory. The general style of the inventory will be able to consider the prospect related
to the costing of the inventory. The cycle inventory cost can be calculated through the
implication of various elements of costing in respect of cycle inventory.
Application of Safety Stock Inventory in Matador
Safety stock is the amount of extra and surplus inventory that the organization keeps to
face the ups and down of uncertain aspects of the demand, lead time and supply changes
of the market (Winston 2005). Matador also keeps the safety stock in the inventory to
face the ups and downs of demand based on certain situation of the market. The safety
stock of Matador is the 20% of their total production (Matador 2014).
Implication of anticipation inventory in Matador
Anticipation inventory is the way of keeping the inventory based on the anticipation of
the demand. It is used to absorb the uneven rates of demand or supply which the
organization may face in the market. The Matador keeps the inventory on the basis of
assumption of the demand and the supply. The anticipation of the inventory also depends
on the sales budget, sales forecast and product itself.

Justified comparison of pipeline inventory in Matador

The material flow system in an organization is regarded on the basis of inventory that
moves from point to point in the entire flow of inventory. Even though Matador does not
follow the pipeline inventory system but the information generated from the discussion
can be used to calculate the pipeline inventory of the organization.
The equation and calculation of pipeline inventory in terms of Matador is given in the
following;
Pipeline Inventory = DL
D= Weekly Demand of the inventory
L= lead time.
Pipeline inventory of matador = 100000120
= 12000000
These are the inventory practices that are practiced and relevant in case of inventory
styles in respect of Matador. This will illustrate the possible factors and practices that are
present within the organization.
System of Inventory Management in Matador
Matador uses ABC costing method for different category or product line on the basis of
demand. The product line of the organization and the product line is differentiated in
accordance with the ABC method where the product are categorized with the basis of
dollar value usage of the product. Matador differentiate the product on the basis of
demand as well. The more the demand, the more close and flexible the inventory
management will be as well.
These are the relevant contemporary inventory system of Matador that can be related to
and illustrated on the basis of the gathered information.

9. Supply Chain Practices of Matador Ball Pen Industry.

Supply chain creates the network of utilities among customer and supplier with feasible
order fulfillment process. Supply chain management is in the mainstream of Matador as
they are the market leader in the Ball pen industry in Bangladesh. The market of the
Matador is the whole country and so that they need to maintain an efficient supply chain
strategy. How Matador is practicing the supply chain management process in their
business to satisfied customers with a well supply flow will be reflected in this content.
The different supply chain practices of the Matador Ball Pen Industry are given below
with various aspects and measures of the supply chain management.
Supply Chain for Manufacturing
In the manufacturing of the product of the Matador different aspects of supply chain is
directly related that affected the operations of the Matador.
Raw Materials:
Matador is the market leader in the Ball pen industry because they not only produce
quality product but also uses good quality raw materials in their production. All the raw
materials of Matador are imported from different country based on their character.
As their raw material Matador use PP (poly profane) which actually the byproduct of
petroleum is imported from Middle East and warehoused at Singapore. This is the basic
material which we often used to call plastic. Another material in the manufacturing
process named Tips are came from India, Thailand and Germany. The core material of the
pen Ink, are imported from India, Germany, Japan and Thailand. And the packaging
manual is come from Taiwan (Matador 2014).
So, overall in the purchasing and supplying of the raw material Matador is very much
conscious and careful as they are directly related with the customer satisfaction.
Finished goods:
Finished goods are the items that are actually produced from the manufacturing plant and
it ready to use or consume. Here for Matador the finished good are ball pen manufactured
from the plant and send for the supplier, wholesaler and retailer for the consumer. The
finished goods of Matador are of various types, category and prices.

Inventory measures of Supply Chain Performance

Weeks of supply:
The production of Matador is in the good pace and rapidly they need to supply the
products into the every places of the country. So, Matador is able to manage high weekly
sales. The weeks of supply of Matador is about 9.5 weeks which actually measured by
dividing the average aggregate inventory value with weekly sales (Matador 2014).
Inventory Turnover:
Inventory turn is very important to know for every business which emphasizes the
organization in maintaining a good inventory system. Inventory turnover is measuredby
dividing the annual sales with average aggregate inventory value. The inventory turn of
the Matador is 5 turns ina year which meets their standard of turns a year. The more the
turnover in a year, the more the revenue Matador earn because of its direct relation with
the annual sales. To achieve more progress the Matador should increase the total annual
sales or need to decrease the aggregate inventory value.
Supply Chain Process Measures
Customer relationship process:
Matador maintains their customer relation process in various ways in a cordial manner.
As a market leader in an industry Matador follows and maintains their customer
relationship process through different medium. Matador has its website and through it
Matador provides updated information to their customers.
E-commerce: We all know that e-commerce is the ace of every organization in the
communication process with the customers. Matador is not beyond that. Through the
website of Matador, it provides various offers to the customers. Customers of Matador
are able to purchase their product through ordering in the internet. On the basis of order
Matador has provided home delivery for their customer. E-commerce gives Matador great
flexibility in reaching the global access with reduced cost (Matador 2014).
Business to Business Systems: Matador not only sells their products to the ultimate
consumers by the retailers but also involves commerce between different firms. Matador
sales their product to many big business organizations including multinational company,
bank, corporate house, pharmaceuticals, chemical and many others which actually
purchases a great amount or lot of product (Matador 2014).

Order Fulfillment and Distribution Process

Order fulfillment of the customers and effective distribution gives a business huge benefit
in capturing the customers mind and make the product available at their hand. The
strategies of Matador in both processes areForward Placement: Forward placement is locating the stock of product closer to
customer. Matador has successfully practicing the forward placement strategy in their
order fulfillment process. Matador places their inventory at different warehouse
controlled by the dealers or to wholesalers across the country for better placement and
easy access to the product among the customers. Matador has 270 inventory placement
and distribution center across the country for the placement of product or inventory.
Decentralized Distribution: In their product distribution strategy Matador usually used
decentralized distribution from 270 distribution centers. The 425 sales representatives
also provide it a good flow in the distribution of their product. Matador distributes their
product from Dhaka to rural places of the country. Good transportation system gives
Matador a thrust in their distribution system. As their distribution vehicle Matador uses
pick-up van, covered van, rickshaw van and also uses their party transportation system.
Matador also operates their inventory and distribution process through software that gives
them the necessary information about the whole inventory and distribution system that is
their one of the competitive advantages.
Supplier Selection and Relationship Process
Effective supplier selection and maintaining a good relationship with supplier is another
key factor for any business organization to achieve goal. Matador maintaining their
relationship with supplier in a feasible manner that benefited both party by providing
good output.

Figure: Aspects of supplier relation of Matador

Figure: Supplier Selection Criterion of Matador

Supply chain Disruption
Matador doesnt have a any kind of internal causes to hamper or disrupt its supply chain.
The only for which the supply activities disrupted is the external activities. In the
production to distribution Matador maintain a sustainable flow that keeps their supply
chain smooth. The external causes that sometimes hamper it activities are

Late deliveries
Absence of the purchaser
Violence political situation
Unfavorable environment
Transportation strikes

Efficient Supply Chain strategy

There are basically two types of supply chain strategy including Efficient supply chain
strategy and Responsive supply chain strategy. Between this two kinds as a supply
chain strategy Matador follow the efficient supply chain strategy for their huge amount of
customers and higher demand. Efficient supply chain strategy focuses on the efficient

flow of services and materials to a minimum. Efficient supply chain strategy works best
where demand is relatively high and predictable.
Matador regularly conducts market survey over their customer, supplier and competitors.
Through the market survey Matador are easily able to know and predict their relative
demand in future for their potential and new market.
Product customization
Matador not only produces and sale regular pen as their product but also customize their
product for the customers. In case of product customization Matador priories the big
organizations who actually customize and purchase a great lot of the product.
Here customization is occurs by designing and shaping the product design into customers
choice and so Matador customize their product by customized design and putting the
names of the organization on the pen. Some of the customized buyers of Matador are

Unilever Bangladesh Ltd.

Marico Bangladesh Ltd.
Pacific Pharmaceuticals Ltd.
Kohinoor Chemical co. (BD) Ltd
Civil Engineers Ltd
Islami Bank Bangladesh Ltd

10. Limitation and constraints faced by the Matador Ball pen Industry.
In managing the inventory of the business Matador faces various limitations in the
inventory management of the inventory of the organization. As the inventory
management system of the organization is basically focused on cycle inventory and
anticipation inventory Matador to some extent has the implication of almost every
relevant inventory management practices.
Matador faces the most crucial problem regarding the financial limitations in case of
managing the organization. The organization has limitation in case of the holding cost if
the inventory. The tax, insurance and the rent of the inventory costs also adds up to the
limitations that are faced by the organization. The limitations are also extended to the cost
of raw materials that are increasing day to day. The recent announcement by the
government to increase the price of gas has also incremented the limitation to an
extended level.

11. Recommendationfor Matador Ball pen Industry to eradicate the constraints.

As there are many constraints and limitations faced by the Matador, they require some
recommendations for the problems they are facing. Matador argues that they don`t have
any limitations in the supply chain management and only few problem is associated with
inventory management system the recommendations should be inventory based. The
following recommendations Matador can follow to eradicate their constraints Matador need to ensure a sustainable flow of the working capital for the better
management of the work in process and inventory management.
Matador need to empower its relation to the foreign raw material supplier and take
a better control of the market so that the increased price of raw material cannot
hamper its activities.
Cost effectivemeasures should be taken to minimize the cost and charges that are
related to the holding and supply charges within the flow of the management.
Government and other regulatory organizationmust facilitate Matador with proper
beneficial procedures to enhance the efficiency in the overall operation of the
organization.

12. Conclusion
The overall objective of the report is to assess the entire operation management situation
of the organization. This report contains a brief discussion about the relevant overview of
various operation management practices and their implication in the contemporary
operation management practice of the industries in Bangladesh. This report also
elaborates wit efficiency the various application of supply chain management and
inventory management practices in terms of Matador. The assessment of existing
inventory and supply chain practices has been outlaid in the report with proper
justification and efficacy. At last proper recommendation has been made that will
facilitate the organization to ensure a better and enhanced operation management practice
in Matador.

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14. Appendix:

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A PHOTO WITH DEPUTY GENERAL MANEGR OF MATADOR

A GROUP DISCUSSION WITH DEPUTY GENERAL MENAGER OF MATADOR