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MANAGEMENT PROGRAMME Term-End Examination June, 2OO8

AND SUPPLY MS-55 : LOGISTICS CHAIN MANAGEMENT


Time : 3 hours Nofe : (i) Section A hos six questions' each carrying 20 marks.Attempt any four questions. SectionB is compulsory, and carries20 marks. Maximum Marks : 700

(ii)

SECTION A "l . by "Efficient CustomerResponse What do you understand (ECR)" ? Discuss the strategies that are followed in implementationof ECR. Integrationof supply chain and demand chain can be seen the strategies from three angles.What are they ? Disct-tss that are followed for an effectiveintegration.

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Discussthe categoriesin which supply chain information requirements can be classified. Give examples of the information containedwithin these categories. What is the need for supply chain performancemeasures? Mention some of the supply chain performance measurementsystemsthat are in practice. Discussone of them in detail.

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Why is it said that selectionof the right transport m_ode is necessary for optimum customer satisfaction and a balanced logistics system for the firm ? Discuss the strategiesthat are followed in order to better coordinate the transportation function. Discuss various factors that influence the design of the supply chain. Discuss the three categories in which one can classify decisions relating to flow of information, product and funds in context to supply chain design.

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SECTIONB
7. Read the following case and answer the questions given at the end.

ROCHE DIAGNOSTICS Roche Diagnostics, based in Basel, Switzerland, is one of two divisions of the 1OO-year-oldhealthcare company. For Roche Diagnostics, business success comes primarily from manufacturing and selling many of the world's best-known in-vitro diagnostic products. In-vitro products typically consist of chemicalsthat, when mixed with other substances,cause chemical reactions. These types of tests are highly effectivefor diagnosing a wide

realized that to maintain its business successit had to address the challenges presented by a non-integrated infrastmcture of computer systems, used for monitoring and managing the processes of Roche's analytical

laboratories.The company turned to information systems to help it manage these processes quite complex. Stringent For Quality Tests instance, every batch of chemicals (or which in fact are

"reagents," as they are called)must undergo a series of

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stringent quality tests before being releasedto production. With the old IT infrastructure,which was made up of a dozen, sparate quality management systems, Roche technicians and scientistswere required to communicate with one another, and with production, manually usually by sending faxes to one another. "Eventually, we " were able to send our data into our main ERP system, says Kai Rothermel, information manager QM at Roche Diagnostics."But it was a slow process,since we had a dozen different interfabes between the quality " As a managementsystemsand our central ERP system. result, redundant and sometimes conflicting data

populated the different systems,so laboratory personnel frequentlyhad to check their data, and communicatetheir results manually. Growing Complexity At the same time, quality testing itself was becoming increasingly " complex. Roche was growing, capturing about twice the in-vitro diagnosticsmarket share as its competitors, and was introducing a variety of new products, each of which requiredits own testing regimen. "This industry has always been closely regulated for quality compliance," says Rothermel. "But as the

processes become more complex, the regulatilns get MS-55

more complicated.For instance,for the last three years' the regular government inspectionshave covered our IT systems as well as our actual test and production Roche integrated processes."Becauseof these pressures, information systemsto enhance its quality management processingplants' in its diagnostics (QM) capabilities Numerous Benefits benefitsus in two Yays," says "Quality management ,,First, it performs a full range of laboratory Rothermel. and producesaccurate,consistent managementprocesses, documentation that can satisfy the government audits. integratedwith our ERP second, becauseit is searnlessly and production system, it has let us turn what was an automated highly a into bottleneck IT laboratory-to-productionsystem." In the laboratory, the solution acts as an enterprise laboratory information management system (LIMS) to cover wide-ranging analyses,including audit-trairand problern management. And thanks to the integration of Roche's IT system, all and appropriate QM information now flows directly immediately management into the company's material and batch and production-planning modules- "For

instance, once a new batch of reagent passes the QM testing, the statusof that batch is automaticallyposted as

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stock' in the materialsmanagementsystem,,, says Rothermel. "And if it doesn't pass,then it's automatically blocked from production. " As a result, Roche now gets products to market more quickly than before, because staffers do not have to take the time to manually check and double-checkone another,stest data. Room for Growth, product Safety The solution for quality management has helped Roche Diagnosticsstreamlineits IT infrastructure, too, by eliminating the dozen IT interfaces that connected the laboratory and production systems. This has cleared the way for Roche to continue growing and introducing new products well into the future. The QnA solution has also brought new level of safety both'to its customers and to Roche' according to Rothermel. "We now know we can rely on our Qttt data and its documentatior,,, he mys. "This means our customers and our employees are assured of continuing, top{evel product quality that is extremely irnportant in this business. " "And it means we can be confident about complying with regulatory audits. This is important, because if you don,t comply, the FDA or another agency can actualry shut down your entire plant.',

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Questions : (a) How has Roche improved its quality management without increasingIT complexity ? processes Highlight the importanceof quality in manufacturing'

(b)

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