PART-A

HOLIDAY SHIPPING WARS: COMMIT WITH CONFIDENCE

India is a country with a diversified population and a place where one could find a plethora of cultures.
With such a wide range of cultures come a wide range of festivals. But festivals means holidays! But
being in India, we get holidays for every festival. Every holiday is looked at as an opportunity from both,
the buyers as well as the sellers point of view. This leads to something which occurs
frequently.Shipping wars.

Before I proceed, it is important to lucidly understand the termShipping Wars. In a laymans language,
shipping wars means, literally, the wars that occur during the delivery of products. But, in a more
technical point of view, holiday shipping wars is a part of the supply chain management. Once upon a
time, shipping was viewed as a perk, but now its viewed as a requirement. Since the time shopping has
gone online, this concept has been even more talked about. The reason for this is that one part of sales
is to first come up with a concept but the other, and the more important part would be to live up to the
concept also to keep improvising them.

So what exactly is the war all about? In the simplest of terms, dont keep a kid waiting with empty socks
during Christmas when you have promised that it wouldnt be empty. Thats the reason why the term
commit with confidence is used. One first needs to set specific targets. But, he/she must also know
how to deliver when it matters.



Fig.1. Sales during holidays
Source: compete.com

Several corporate have come up with their online shipping facilities like PayPal, by Ebay, ShopRunner,
FlipKart.com, Amazon Prime etc. It is important to understand why and how these came up. Just a few
years ago, customers were apprehensive of online shipping as they were worried about the quality of
the products delivered and also the costs for shipping. However, times have drastically changed in the
last 5 years or so. The percentage of holiday shoppers who plan to shop online this year is expected to
reach almost 60% this year. Hence, to attack this segment of buyers requires careful strategy and
meticulous planning. The reason why planning becomes very important is that once the number of users
increase, the process of providing service also becomes increasingly complex. One needs to keep an
account of the stocks available and also keep a check of requirements. That is the reason why one needs
to commit with confidence. Setting realistic targets becomes vital here and estimating the number of
buyers becomes even more important. Hence, many organizations are aiming at bettering their
performances by spending more on Sales and Operations Planning.


Fig 2: Holiday Budget
Source: tomsnewsletter.com

This was meant to get different stakeholders of an enterprise on the same front, which is still vital, but
the new norm is the timely and systemic involvement of the trading partners like the distributors,
customers, suppliers in this process as they have an important impact on the ability to execute to
achieve the operational, commercial, and ultimately, the financial plan. The supply chain is nothing but
the movement of a product from the supplier to the consumer. The basic objective of a supply chain is
optimization of the chain in itself, thus making the process a better one. The Sales and Operations
Planning process and the integration of supply chain planning across the company were concurrently
the largest single opportunity for improvement. From the graph shown, we can clearly infer that sales
certainly depend a lot on the time of the selling.

Shipping in the real world scenario (not online) is probably a more arduous task as there is a direct
interaction with clients and to meet customer satisfaction is a huge challenge in itself. To come up with
specific plans might be a bad idea at times as flexibility is vital here. In India, electronics sell like hot
cakes in the festival season as the prices and offers are certainly more attractive. In fact, the system has
almost transformed into one in which both, the buyers as well as sellers wait for the festive season.

Hence, as a conclusion, one would say that there are two sides to the entire situation-one at the
supplier side and the other at the customer side. However, the suppliers performance is what finally
matters. The ability to sell a product strategically is extremely important. The holiday season just acts as
an opportunity to strike the iron when it is hot. But careful planning is required before the striking as the
process is difficult in itself. To be able to deliver and keep up promises and value orders is something not
every organization can achieve easily. So, the situation is nothing less than a war where confidence is
required before actually committing.




























PART-C

1. LEAD TIME: It is the time required to meet a customers demand.

2. LITTLES LAW: It is the rate of inventory for a given flow time.

3. MUDA: It is the waste that is generated during the production and needs to be minimized

4. QUEUING: It is nothing but the formation of lines. It also deals with the formation and the variation of
the queues.

5. OPERATIONS MANAGEMENT: It refers to the coordination of business practices and has the objective
of creating the highest level of efficiency possible within an organization.

6. BLUE SKY: It refers to the goodwill associated with an asset of a company.

7. EBITDA: Earnings before taxes, depreciation etc

8. FILL RATE: Fraction of total demand satisfied by inventory on hand.
9. Labor productivity: The average output of each worker over a period of time - Current output /
number of workers
10. Merger: The joining of two businesses to create a new organization
11. Economies of scale: The reduction in average cost per unit
12. CRITICAL PATH: It is the path through an activity that has the longest flow time.
13. Subcontracting: Using the resources of another organization, or letting out the business's resources in
order to increase efficiency
14. FLOW SHOP: A flow shop is nothing but an operation which produces products in a continuous flow.
15. Overtime: Staff working beyond their contracted hours in exchange for a higher hourly wage
16. Total Quality Management: It is the approach to quality that aims to involve all employees in the
quality improvement process
17. Kaizen groups: They are formed to encourage new ideas from all workers as part of a continuous
improvement strategy
18. Downtime: It is the period when machinery is not being used. This could be either as a result of
maintenance or when parts of the machinery have to be adapted to produce a slightly different unit of
production
19. Supply chain: It is the chain where all the stages in the production process from obtaining raw
materials to selling to the consumer - from point of origin to point of consumption
20. Stock: It is nothing but the stored materials such as raw materials, work in progress or finished goods
21. Quality product: It is the product or service that meets customer' expectations
22. Quality control: It is the inspection of products to check they meet necessary standards.
23. Job production: It is the manufacture of one-off goods tailor made to meet the specifications
customers.
24. Ombudsmen: They are independent organizations that police specific industries and investigate
complaints on behalf of customers
25. Warranties: It Similar to a guarantee, but normally the customer pays for the extra protection. They
are1 often known as extended warranties or insurance policies against repair and replacement costs
26. Guarantees: It is the official reassurance given free of charge by the manufacturer of a product to the
customer that if the product proves faulty within a specified period their money will be refunded.
27. Operational targets: Specific and measurable objectives set for each operations activity of a business
28. Sustainability: Sustainability is defined as the production systems that prevent waste by using the
minimum of non-renewable resources so that levels of production can be sustained in the future
29. Outsource: The contracting of an outside organization to provide a product or service that might be
too expensive, complicated or time-consuming for the business to do itself
30. Job production: The manufacture of one-off goods tailor made to meet the specifications of the
customer.
31. Rationalization: Reorganizing a business to reduce capacity and increase efficiency
32. Capital intensive
High proportion of capital (machinery) compared to labor
33. Labor intensive
When there is a high proportion of labor compared to capital
34. Flow/Mass production
It is the continuous movement of items through each stage of production
35. Batch production
It is the manufacturing of groups of products to meet a specific order. The products will move through the
stages of production at the same time.
36. Capacity: It is the maximum possible output that can be produced with the given resources
37. Capacity management
It refers to the planning and controlling the capacity of an organization to meet the demands of customers
38. Capacity utilization
The proportion of capacity used over a period of time: Current output / Maximum output x 100
39. Diseconomies of scale
Increase in average cost per unit
40. Unit cost
Average cost per unit of output:
41. Unit labor cost
The cost of labor needed to produce one unit of output
42. Efficiency
It is defined as the making the most of resources by maximizing the output from a given level of inputs.
Labor efficiency is output per worker.
43. Buffer stock
Stock kept in order that production can be increased to meet unexpected demand
44. Opportunity cost
The benefit lost from the next best alternative foregone.

45. Stock-out costs
It is the cost of lost production, lost sales and customer dissatisfaction when the business runs out of stock
46. Total Quality Management
It is an approach to quality that aims to involve all employees in the quality improvement process
47. Minimum efficient scale
The smallest output that a business can produce while making sure that its average costs are minimized
48. External growth
It is the expansion achieved through buying or merging with another business
49. Unit labor cost
It is the cost of labor needed to produce one unit of output
50. ISO 9000/9001
It is the internationally recognized certificate that acknowledges the existence of a quality procedure that
meets certain conditions
















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