END TO END SCM MODEL OF

PAK SUZUKI
SHAHZAIB SUBHANI (21997)
SYED AUON ZAIDI ( 19556)
ARSALAN ZEESHAN (22818)
M. UZAIR ALI (18002)
AHMED SAAD (19475)
 COMPANY PROFILE
• Formed in August 1983 in accordance to a joint venture agreement between Pakistan
Automobile Corporation Limited (PACL) and Suzuki Motor Corporation (SMC).
• The company has a Cars and LCVS plant located at Port Qasim with a production outcome
of 150,000 units per annum. Facilities are Press Shop, Welding Shop, Paint Shop, Plastic
Shop, Engine and Transmission Assembly Shop, Final Assembly & Hi-Tech Inspection
Shop. The Company has also established a modern Waste Water Treatment Plant as its
contribution to the environment.
• Also have a Motorcycle production plant with the output capacity of 37000 units per
annum.
• Pak Suzuki is ranked number 1 among the top Automobile production and selling
companies of Pakistan.
 PROCESS OF SUPPLY CHAIN
MANAGEMENT AT PAK SUZUKI
• Demand planning and forecasting
• Procurement
• Manufacturing and Assembly
• Distribution
• Return
 VENDORS (SUPPLIERS) NETWORK

• Pak Suzuki has promoted and encouraged the downstream vendor industry
of the private sector.
• Currently there are 143 local vendors for different parts and more than 10
foreign suppliers.
 SOURCING THE RAW MATERIAL
• Majority of the components are imported from SMC Japan. Other countries
included are Thailand and Korea.
• There are 3 departments at Pak Suzuki responsible for procurement of materials
from different vendors across Pakistan and other countries.
1. IPP (Imports Parts Purchasing) Department (Procure components from
Foreign vendors)
2. LPP (Local Parts Purchasing) Department (Procure locally developed
components from local vendors)
3. General Purchasing Department (Procure Plant Consumables)
 OBJECTIVES OF IPP DEPARTMENT

• To ensure continuous supply of all the imported inputs to the end user to keep
running the production without any interruption.
• Functions of IPP department
1. Planning ( Inventory, ordering, contracting and negotiating price)
2. Operations (Monitoring, control, logistics, shipments, finance, customs and
insurance)
3. Exports (Commercial, non-commercial, duty draw back and export of hardware)
 OBJECTIVES OF LPP DEPARTMENT

• Arranging components from vendors at competitive prices, in right quantity and at right
time. Order local components at competitive prices & look out for all possible ways to
reduce cost of vendorized parts.
• Departmental Functions
1. Costing & Cost control (Cost assessment of new developing parts and re-assessment of
developed parts)
2. Scheduling ( Issuance of LOI, price revision letter, monthly schedule, additional schedule
and schedule against short supplies)
3. Parts Follow up ( Advance follow up, arrival schedule, dispatch, urgent arrangements and
maintenance of stock)
 OBJECTIVES OF GENERAL PURCHASING
DEPARTMENT
• Following are the main functions of GP.
a) Planning
b) Ordering
c) Follow Up
d) Price Negotiation
e) Market Sourcing
As it is general purchase department therefore it is involved in following types of procurement:
1. Plant Procurement ( Paint and allied materials, consumables, packaging materials and PMEs spares)
2. Administrative Procurement (Computer Peripherals,Mobile Phones, Stationery items, Janitorial items,
Capital Procurement, Computer, Printers, Scanners etc)
 SWOT ANALYSIS WITH REFERENCE TO
SUPPLY CHAIN
• The SWOT analysis of Pak Suzuki with reference to their supply chain management is as follows:
1. Strengths
The strengths are Production capacity, large vendor industry and market goodwill
2. Weaknesses
The weaknesses of Suzuki motors with reference to SCM are warehousing, forecast methods and quality.
3. Opportunities
The opportunities include ERP and R&D Computerization.
4. Threats
The threats for Pak Suzuki motors are the Competitors, Innovations in the supply chain of motor industry.
 PUSH VS PULL
• Push system: material is pushed into downstream workstations regardless of whether resources are available.
• Pull system: material is pulled to a workstation just as it is needed.
INVENTORY
• Traditionally Suzuki motors are keeping inventory as in case problems arise i.e. of stock out. They are also working on Just in Time
approach (JIT).
JIT objective: To eliminate inventory
JIT requires:
• Small lot sizes
• Slow setup time
• Containers for fixed numbers of parts
JIT inventory: Minimum inventory to keep system running, Lower inventory reduces waste and reducing inventory reveals problems so they
can be solved.
PLANNING PROCESS THROUGH ENTERPRISE
RESOURCE PLANNING (ERP)
• The purpose of ERP is to facilitate the flow of information between all business
functions inside the boundaries of the organization and manage the connections to
outside stakeholders (ERP)
• Local parts purchasing department (LPP): LPP sent delivery order to vendors
which is monthly basis and also known as firm orders, delivery order contains order
quantity, delivery dates, packing size, minimum lot size, and starting date.
• Ordering process through ERP in PSMCL: LPP issue delivery order and part
tags to vender, delivery order shows all details and part tags to vender through e-
mail and vender is liable to paste part tags and delivery instruction letter along with
supplier in order to generate GRINS (goods receivable inspection notes)
 ADVANTAGES OF ERP

1. Better scheduling and control

2. Effective delivery order through DI Slip & Part Tag
3. No mistake in required documents for making GIRN.
4. Effective application of FIFO
5. Better control on supply over delivery order quantity.
6. Easy handling of received materials in standard packing with Part Tag
 FLOW OF MANUFACTURING PROCESS

1. Press Shop ( Fabricate Sheet metal parts)

2. Welding Shop ( Chasis number punching and transfer of body shells)
3. Paint Shop ( loading white body shells from welding shop, transfer of painted body shells at final
assembly area and off loading from conveyor)
4. Engine &Transmission Shop ( Off loading of engines from conveyor after test line and transfer of
engine to final assembly area)
5. Plastic Shop ( Transfers sub assemblies to the final assembly area)
6. Material Handling Department ( keeps close link with all the purchasing departments and production
lines, supply parts to all production lines and ensure smooth flow of production)
7. Vehicle Inspection Department ( Inspects for any defects, send for re-work if required and finally issue
clearance)
 PRODUCTION MONITORING & REPORTING

Production monitoring and report includes the following procedures:

1. Loading sequence report
2. Monthly standard cycle time report
3. Color wise & version wise cycle time report
4. Color wise & version-wise production follow up
5. Monthly reports
6. Monthly activity report
7. CKD stock position (Completely Knock Down)
8. Production division manpower status
 Material Handling Department (MHD)

FUNCTIONS
1. Receiving
2. Storage
3. Supply to the Production Line
• ROLES
• 1. Head of Department (Monitoring and supervising)
• 2. Section In-charge (Carries out activities for safety, quality, productivity and administrative affairs)
• 3. Shift In-charge (Responsible for shift production and solving abmormalities related to production)
• 4. Integrates Management System (IMS) Coordinator (Performs concerned departmental activities)
• 5. Quality Coordinator (Ensures quality at all platforms and processes is maintained)
• 6. Safety Coordinator (Ensures safety is not compromised at any cost)
• 7. Kaizen Coordinator ( Ensures continuous improvement )
 MHD CONT’D
• Issue parts to other departments. Receive requisition, check the status of the required material and
finally issue material. All delivered parts are compiled at end of the month to place the order for
replenishment of stock.
• Supply of parts to production line. Material Handling department ensure FIFO (first in first out) of
the parts.The shop wise staff have been deployed for the supply of parts. There are specified and
general trolleys designed in order to carry more parts in a lesser amount of time. Parts filled in trolleys
& bin at un-boxing area and then transferred to the desired place.
• Storage areas. The parts have information/serial tags attached on them in the storage areas. Each part
has its separate location as well. All parts in these areas are clearly identified and arrange in groups
according to their type. The storage areas need proper cleaning and maintenance in order to prevent
damages and deterioration of stored items.
 MAJOR PROBLEMS FACED BY MHD

1. LINE REJECTION
• It is caused by the mishandling of worker (unskilled), or the manufacturing fault.
2. DEFECTED & SHORT SUPPLY
• Some times MHD gets defected supply or the quantity they’re getting is not up to the
specification. This causes shortage and interrupts the involved process.
3. PARTS ISSUANCE TO OTHER DEPARTMENTS
• Parts issued to the other departments because of some unavoidable situations.
 ROLE OF QUALITY ASSURANCE

• Parts inspection department is involved in assuring quality in the supply

chain.
• PARTS INPECTIONS DEPARTMENT: PID checks the quality of the
components which are delivered by the vendor or supplier through JIGS and
FIXTURE in order to ensure PSMCL standard. Jigs and fixtures are special
purpose tool which are used to facilitate production (machining, assembling
and inspection operations).
 Dealer (Customer) Network

• The dealers of Pak Suzuki are situated across the country to cater all the
important areas.
• These provide sales, service and genuine Suzuki spare parts. At present there
are 74 dealers of Pak Suzuki stretched in all major cities of Pakistan.
• These dealerships make up the country’s largest vehicle after sales service
and genuine spare part network
 RECOMMENDATIONS
1. Lobbying with Policy Makers
2. SCM Process Definition
3. MRP System (Pak Suzuki is practicing MRP system and they are maintaining their material
planning on excel. In our opinion Pak Suzuki should consider more advance software for their
facility)
4. Alternative Vendor’s Pool (Look for alternatives with same quality just in case of any mishap)
5. Develop Vendors Society
6. Marketing Intelligence. (Provides up to date marketing information)
7. E-Supply Chain (High speed, low cost, communication and collaboration with your customers
and suppliers are critical success factors to more effectively manage your supply chain)
 CONCLUSION

• SCM is now days one of the greatest emerging technological implication.

Supply chain management (SCM) is a concept that has flourished in
manufacturing, originating from Just-In-Time (JIT) production and logistics.
• Today, SCM represents an autonomous managerial concept, although still
largely dominated by logistics.
• SCM endeavors to observe the entire scope of the supply chain. All issues
are viewed and resolved in a supply chain perspective, taking into account the
interdependency in the supply chain.
THE END