Materials Management

1. Basic Materials Managment Practices on IR

I. Role of Materials Management

Role of Materials Management in industry is increased from clerical role to strategic. It has profit center approach.To know more   Click Here

II. Organisation of Materials Management Department:

The Indian Railways net work is owned andmanaged by the Central Government. Operations are controlled and directed by the Railway Board under the over-all supervision of the Minister of Railways. The network of Railways is divided into 17 zonal railways each under the control of a General Manager. Each Railway zone is organized on the divisional pattern of working.

           In addition there are modern Production Units- viz. Chittaranjan Locomotive Works, Chittaranjan (Electric Locomotives); Integral Coach Factory (Integrated coaches), Chennai ; Diesel Locomotive Works (Diesel Locomotives), Varanasi; Rail Wheel Factory, Bengaluru; Diesel loco Modernisation Works, Patiala; Railway Coach Factory, Kapurthala.

             On a Zonal Railway, General Manager is assisted by Additional General Managers and Heads of different departments such as Controller of Stores, Chief Engineer, Chief Optg. Mgr., Chief Comml. Mgr., Chief Mech. Engineer, etc. To know more Click Here

III. Classification of Stores:

All materials are basically divided into two broad categories viz. Stock and Non-Stock. The stock items are those items for which there is a regular demand, regular drawl or consumption and there is a regular recoupment. Non-stock items are required occasionally and not on regular basis. The Stores Department is required to give a service of making thousands of items available to the indenters when required. There are approximately one lakh eighty thousand such items all over the Railways stocked in 259 stores depots. To give this service we have to maintain stocks of a large number of items known as “Stock items” whereas for other items, which are not frequently required or having one time requirement, no stocks are maintained. These items are purchased as and when required to meet specific demands and are called “Non-stock items”. To know more Click Here

IV. Requisitioning and Distribution of Stores:

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V. Purchasing:

The purchasing function is generally centralised in the headquarters office of the Controller of Stores. The recoupment or estimate sheets for stock items routed through the stores depots are received in the purchase office of the Controller of Stores for arranging procurement of all these items. The COS has full authority to scrutinize every demand, to question regarding quality of items and modify the quantities.

For small value purchases, however, the depot officers as well as Divisional Railway Managers have been delegated powers to do local purchase.To Know more Click Here

VI. RETURNED STORES & SCRAP DISPOSAL

All the materials no more required by the consuming departments should be returned to the nominated stores depots for taking disposal action. Such materials are returned along with an Advice note for returned stores (form No. S-1539) prepared in 6 copies. The 6 copies are distributed in such a way that debits and credits can be raised by the Accounts department for the transaction satisfactorily. To Know more Click Here

VII. INVENTORY CONTROL

Improving Service level and Inventory Control:

To ensure continuous availability of stores to user departments while keeping the stock levels at optimum level is one of the important objectives of Stores Department. Efficiency with regard to optimum stock levels is measured by working out inventory turnover ratio on every 31st march, which is worked out as attached:- To Know more Click Here

VIII. IMPORT

Level of Imports by IR:

YearImports (Cr.)
Total (Cr.)
%age of Imports
1950-5118.40
81.60
23.0
1960-6119.80
177.90
11.0
1970-7132.60
363.70
9.0
1980-81
143.80
1377.10
10.4
1990-91
440.10
5189.30
8.4
2000-01
462.00
10835.00
4.3
2001-02
385.16
10950.00
3.5
2006-07
594.0018651.003.2
2007-08
630.00
21982.002.9
2008-09
813.00
27495.003.0
2009-10
1151.00
27876.004.1
2010-11
1082.0029099.003.7

Import Procedures- :To Know more Click Here

2.Materials Management on IR at a glance

3.Supply Chain in Public Procurement Enviroment

Purpose- This paper provides analysis of supply chain management framework in the public procurement environment through a case study of the Indian railway. The paper provides some insights about the evolution of supplier relationship management and its impact on key performance indicators. Its also provides an integrative framework for management of public procurement.

 Methodology- The paper builds on extensive review of literature and follows a case study methodology. The unit of analysis is the Indian Railway’s material management function. Analysis uses data of over a period of five years.

 Finding- The finding highlights that supplier relationships with the Indian railway have been geared around arms-length philosophy. The current symptoms of inefficiencies are reflected in high cycle time, high costs associated with supplier selection process, poor accountability, blurring of responsibility and poor value creation for all the stakeholders. The current procurement mechanisms are not crafted around development of long term strategic partnerships.

 Research limitations/implication- This study is filling the gaps in literature by presenting the challenges of supply chain management in the public procurement environment. Insights from developing country like India can be applied to other public procurement systems.

 Practical Implication- The paper deals with sensitive issue of public procurement system. The findings would be useful for policy makers in developing mechanisms for instilling insights of business management into the realms of public management.

 Originality/value- The study is first of a kind to provide a conceptual framework for understanding building blocks of the supply chain management in the public procurement environment.

 Key word- Supply Chain Management (SCM), Public Procurement (PP), Key Performance Indicator(KPI), Indian Railway (IR), Material Management (MM), Performance Management System (PMS), Third party logistics (3PL), Bill of Material (BOM), Leading Automobile Co. (LAC), Long term contract (LTC). To know more Click Here