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INDIAN INSTITUTE OF MANAGEMENT AHMEDABAD INDIA Research and Publications The Logistics Sector in India: Overview and Challenges Pankaj Chandra Nimit Jain W. P. No. 2007-03-07 March 2007 The main objective of the working paper series of the IIMA is to help faculty members, Research Staff and Doctoral Students to speedily share their research findings with professional colleagues, and to test out their research findings at the pre-publication stage INDIAN INSTITUTE OF MANAGEMENT AHMEDABAD-380 015 INDIA INDIAN INSTITUTE OF MANAGEMENT AHMEDABAD INDIA Research and Publications The Logistics Sector in India: Overview and ChallengesPankaj Chandra Nimit Jain Indian Institute of Management Ahmedabad Vastrapur, Ahmedabad 380015 [email  protected] ernet. in, [email  protected] ernet. in Abstract The logistics industry in India is evolving rapidly and it is the interplay of infrastructure, technology and new types of service providers that will define whether the industry is able to help its customers reduce their logistics costs and provide effective services (which are also growing). Changing government policies on taxation and regulation of service providers are going to play an important role in this process.Coordination across various government agencies requires approval from multiple ministries and is a road block for multi modal transport in India. At the firm level, the logistics focus is moving towards reducing cycle times in order to add value to their customers. Consequently, better tools and strategies are being sought by firms in order to enhance their decision making. In this paper, we provide a perspective on these issues, outline some of the key challenges with the help of secondary information, and describe some interesting initiatives that some firms & industries are taking to compete through excellence in managing their logistics.IIMA INDIA Research and Publications 1 Introduction The Indian economy has been growing at an average rate of more than 8 per cent over the last four years (Srinivas, 2006) putting enormous demands on its productive infrastructure. Whether it is the physical infrastructure of road, ports, water, power etc. or the digital infrastructure of broadband networks, telecommunication etc. or the service infrastructure of logistics – all are being stretched to perform beyond their capabilities.Interestingly, this is leading to an emergence of innovative practices to allow business and public service to operate at a higher growth rate in an environment where the support systems are getting augmented concurrently. In this paper, we present the status of the evolving logistics sector in India, innovations therein through interesting business models and the challenges that it faces in years to come. Broadly speaking, the Indian logistics sector, as elsewhere, comprises the entire inbound and outbound segments of the manufacturing and service supply chains.Of late, the logistics infrastructure has received l ot of attention both from business and industry as well as policy makers. However, the role of managing this infrastructure (or the logistics management regimen) to effectively compete has been slightly under-emphasized. Inadequate logistics infrastructure has an effect of creating bottlenecks in the growth of an economy, the logistics management regimen has the capability of overcoming the disadvantages of the infrastructure in the short run while providing cutting edge competitiveness in the long term.It is here that exist several challenges as well as opportunities for the Indian economy. There are several models that seem to be emerging based on the critical needs of the Indian economy that can stand as viable models for other global economies as well. Chandra and Sastry (2004) have pointed towards two key areas that require attention in managing the logistics chains across the Indian business sectors – cost and reliable value add services. Logistics costs (i. e. inventor y holding, transportation, warehousing, packaging, losses and related administration costs) have been estimated at 13-14 per cent of Indian GDP which is higher than the 8 per cent of USA’s and lower than the 21 per cent of China’s GDP (Sanyal, 2006a). Service reliability of the logistics industry in emerging markets, like India, has been referred to as slow and requiring high engagement time of the customers, thereby, incurring high indirect variable costs (Dobberstein et. al, W. P. No. 2007-03-07 Page No. 3 IIMA INDIA Research and Publications 2005).However, the Indian logistics story is one with islands of excellence though there has been a general improvement on almost all parameters. It is this aspect that we explore further in this paper. The paper is organized as follows: the next section gives a brief introduction of some of the peculiarities of the Indian logistics sector. In section 3 we discuss the determinants of growth in this industry. In section 4 we prov ide some interesting initiatives that point towards a renewal of the sector. The challenges facing the sector are discussed in the last section. 2 Some Peculiarities of the Indian Supply ChainsThe Indian logistics sector has typically been driven by the objective of reducing transportation costs that were (and often continue to be) inordinately high due to regional concentration of manufacturing and geographically diversified distribution activities as well as inefficiencies in infrastructure and accompanying technology. Freight movement has slowly been shifting from rail to road with implications on quality of transfer, timeliness of delivery and consequently costs except for commodities which over long distances, predominantly, move through the extensive rail network. More on the infrastructure issues later.Figure 1 shows the relative value of transportation costs vis-a-vis other elements of the logistics costs in India. The transportation industry is fragmented and largely unorga nized – a large number of independent players with regional or national permits that carry freight, often with small fleet size of one or two single-axle trucks. This segment carries a large percent of the national load and almost all of the regional load. This fragmented segment comprises owners and employees with inadequate skills, perspectives or abilities to organize or manage their operations effectively.Low cost has been traditionally achieved by employing low level of technology, low wages (due to lower education levels), poor maintenance of equipment, overloading of the truck beyond capacity, and price competition amongst a large number of service providers in the industry. Often, one finds transportation cartels that regulate supply of trucks and transport costs. However, the long run average cost of transport operations across the entire supply chain may not turn out to be low. W. P. No. 2007-03-07 Page No. 4 IIMAINDIA Research and Publications Figure 1: Elements of Logistics Cost in India Trans por tation 40 War e hous ing, Pack aging & Los s e s 24 26 Inve ntor y Or de r Pr oce s s ing & Adim ins trative 0 5 10 10 15 20 25 30 35 40 45 percent contribution Source: Sanyal (2006a) Table 1 gives a breakup of the logistics cost across different sectors of the Indian industry and the changes therein over the last five years. It shows how the logistics spend is increasing, sometimes dramatically, across various industrial sectors. Steel, harmaceuticals, food & agro-business, and auto have also been the sectors that are growing most rapidly in the national economy – it is no surprise that their logistics costs have been increasing at a faster rate. A few observations are in order here. The low change in order processing & administrative costs in the cement sector could possibly be due to the use of call centers by various producers for order processing and dispatch planning. Steel and pharmaceutical sectors have seen maximum changes in compon ent costs.The distribution practice of pushing goods down the channel might be responsible for high increase in the inventory and warehousing costs in the pharmaceutical industry. Investments in new cold chains and losses might be the causes of high change in the warehousing, packaging & losses related costs. Warehousing, has also been typically dominated by small players with small capacities and poor deployment of handling, stacking and monitoring technologies. While it has had detrimental effect on almost all sectors, the food sector has been the one that has suffered the most due to low investment in cold chains and allied machinery.Erratic power outages have also meant low dependence on technology and a more manual operation. Another fact that has affected both the location as well cost of operating a W. P. No. 2007-03-07 Page No. 5 IIMA INDIA Research and Publications warehouse has been the â€Å"octroi tax1. † Firms have been locating warehouses outside city limits. Ta ble 1: Distribution of Logistics Costs across Some Sectors (2000-2005) Logistics Cost Components (in US $ mn) Transport ation Inventory holding Warehousing, packaging & loses Order processing & administrative Total Logistics cost SectorAuto Cement Consumer Durables FMCG Food Garment Pharmaceutical Steel Source: IAEIS 2000-01 2005-06 Avg. Change 2000-01 2005-06 Avg. Change 2000-01 2005-06 Avg. Change 2000-01 2005-06 Avg. Change 2000-01 2005-06 Avg. Change 2000-01 2005-06 Avg. Change 2000-01 2005-06 Avg. Change 2000-01 2005-06 Avg. Change 285. 0 406. 5 20. 3 50. 6 55. 4 4. 8 331. 9 398. 9 11. 2 201. 5 280. 7 13. 2 398. 7 524. 5 21. 0 337. 3 454. 4 19. 5 174. 0 310. 0 22. 7 438. 3 693. 6 42. 5 171. 0 243. 9 12. 2 30. 4 33. 3 2. 9 199. 1 239. 3 6. 7 120. 9 168. 4 7. 9 239. 3 314. 7 12. 6 202. 4 272. 11. 7 104. 4 186. 0 13. 6 263. 0 416. 1 25. 5 185. 3 264. 3 13. 2 32. 9 36. 0 3. 1 215. 7 259. 3 7. 3 131. 0 182. 5 8. 6 259. 2 340. 9 13. 6 219. 2 295. 3 12. 7 113. 1 201. 5 14. 7 284. 9 45 0. 8 27. 7 71. 3 101. 6 5. 1 12. 7 13. 8 1. 2 83. 0 99. 7 2. 8 50. 4 70. 2 3. 3 99. 7 131. 1 5. 2 84. 3 113. 6 4. 9 43. 5 77. 5 5. 7 109. 6 173. 4 10. 6 712. 6 1016. 4 50. 6 126. 5 138. 5 12. 0 829. 6 997. 3 27. 9 503. 8 701. 8 33. 0 996. 8 1311. 2 52. 4 843. 2 1135. 9 48. 8 434. 9 775. 0 56. 7 1095. 7 1734. 0 106. 4 They delay moving goods into retail network as late as possible.It has also led to the development of a unholy business-government nexus to avoid the tax and extract rents. Use of technology is quite limited – both IT and engineering equipments in order to increase productivity and service. An in-appropriate evaluation of the diverse benefits of technology has led to higher usage of manual labour across the logistics industry whether An entry tax on goods coming into a city. The tax is a major source of revenue for city municipal corporations. W. P. No. 2007-03-07 1 Page No. 6 IIMA INDIA Research and Publications it is in the distribution activities or within pla nts.Many firms try to compete through the factor advantage of low wages which have necessitated hiring low or no skill personnel thereby sacrificing productivity related gains in the long run. Understanding the linkage between inventory and transport planning is a key to reducing operational cost of distribution. Chandra and Sastry (2004) identify transport & dispatch planning as an area of concern in a survey of manufacturing firms in India. Ninety eight per cent of sample firms in that survey have a contract with trucking companies for making dispatches and only 11 per cent own their own fleet of trucks.While 36 per cent of these firms use third party logistics (3PL) service providers for making dispatches, about 30 per cent use 3PL service providers for procuring their material from their suppliers. Somehow, transport planning has remained a unglamorous area within Operations despite the fact that about 10 per cent of the cost of sales comes through physical distribution (Sanjeev i, 2003). Transport planning (e. g. , optimal dispatch quantities & frequency of dispatch, vehicle routing, loading pattern in the trucks etc. ) does not appear to have received the required attention.For example, in the same survey, only 21 per cent of sample firms report the use of some software for scheduling dispatches. It is worth understanding the structure of the Indian supply chains, in aggregate, to get a better appreciation of many of the issues raised earlier. In Figure 2 Chandra and Sastry (2004) present the structure of the supply chain of a sample of firms. It can be seen that about 4 per cent of firms have less than five suppliers, about 85 per cent of firms have less than five plants, about 14 per cent of firms have less than five regional distributors, and about 9 per cent of firms have less than five retailers.A similar statistics is obtained for other ranges of suppliers, plants, distributors, and retailers. What is worth noting is that 63 per cent of firms have m ore than 100 suppliers, about 39 per cent of firms have more than hundred distributors, and 77 per cent of firms have more than hundred retailers. In addition, about 17 per cent of firms claim to have more than 500 suppliers. The same for distributors and retailers is 22 and 54 per cent respectively. This is perhaps where difficulties in managing logistics in India lie – larger the number of suppliers or distributors, higher is the cost of coordination.W. P. No. 2007-03-07 Page No. 7 IIMA INDIA Research and Publications Figure 2 : Structure of the Supply Chain of Sample Firms 90 80 70 Percent of Firms 60 50 40 30 20 10 5000-10000 1000-2000 2000-5000 500-1000 100-500 50-100 10-15 15-25 25-50 0 5-10 0-5 more than 10000 Range Suppliers Plants Approved Retailers Regional Distributors Source: Chandra and Sastry (2004) When we look at the spatial distribution of both plants and suppliers, the above statement becomes even stronger. Of the sample firms that operate more han one plant , 48 per cent of these plants are located more than 100 kilometers away from each other, 33 per cent of these plants are located more than 500 kilometers away from each other and 18 per cent of these plants are located more than 1000 kilometers from each other. Similarly, on an average, only 4 per cent of suppliers are located within 5 kilometers of the manufacturing plant, about 13 per cent are located within 5-25 kilometers of the plant, 16 per cent are located within 25-100 kilometers of the plant and about 67 per cent of suppliers have facilities that are more than 100 kilometers away from the plants.Location policies of the past may have forced some firms to locate plants away from each other. However, this may be coming to haunt today as the cost of coordination increases and the ability to provide quick response to customer requirements might reduce. This problem gets exacerbated with suppliers. Manufacturers have to either develop suppliers separately for each location (ther eby increasing the number and affecting consistency in quality, price & delivery times) else material has to travel longer distances if there is a common supplier to all plants. W. P. No. 2007-03-07Page No. 8 IIMA INDIA Research and Publications The logistics challenge in such an environment is immense – build the infrastructure, manage the requirements of a changing structure of various sectoral supply chain, change industrial policies to facilitate efficient production and movement of goods and services, deploy effective managerial practices and technology to enhance the competitiveness through better management of logistics networks, and develop new models for new sectors especially in the service sectors as well as traditional areas like agri-business etc.It must be mentioned that the logistics industry in India is transforming itself very interestingly despite its peculiarities by developing innovative business models and by chipping away at the such structural and polic y based rigidities. In a later section, we discuss some of these innovative initiatives that are leading the renewal of the logistics industry in India. 3 The Changing Logistics Infrastructure With rising consumer demand and the resulting growth in global trade, the role of infrastructure support in terms of rails, roads, ports & warehouses hold the key to the success of the economy.In this section we provide a quick overview of the status of the logistics infrastructure in India and the current initiatives, both private and public, in that area. Goods are transported predominantly by road and rail in India. Whereas road transport is controlled by private players, rail transport is handled by the central government. With the second largest network in the world, road contributes to 65 per cent of the freight transport (Rastogi, 2006). Road is preferred because of its cost effectiveness and flexibility.Rail, on the other hand, is preferred because of containerization facility and ease in transporting ship-containers and wooden crates. Sea is another complementary mode of transport. Ninety five per cent of India’s foreign trade happens through sea (Deccan Herald, 2006). India has 12 major ports, six each on the West and East coasts and 185 minor ports. Table 2 maps the various modes on different performance indicators, clearly indicating the vitality and importance of road transport in Indian economy. There is also evidence of an, across the board, increase in freight traffic for all modes indicating an increased logistics activity.For instance, the per cent change in road, rail, air and sea cargo traffic has increased, between 2001 and 2005, from 5 to 14 per cent, 4 to 7. 5 per cent, 6 to 20 per cent and 3. 5 to 11 per cent respectively (CMIE Database, 2006). W. P. No. 2007-03-07 Page No. 9 IIMA INDIA Research and Publications Table 2: Comparison Chart for Various modes Rail 214760 10. 66 0. 11 Road 3487538* 5. 12* 3. 34 Sea 806 7. 9 12 Number (wagons, tr ucks, ships) Freight Capacity(mn ton) Route Length (mn km) /Number of major ports Freight Revenue (US $ bn) 7. 00 coal, steel, petroleum, primary metals 38. 64 automobile, electronic items, garments etc. 304 iron ore, coal, petroleum (and industrial and consumer products on the outbound export) Major Products Source: IAEIS, 2005-2006, Financial Express, 2006a *This figure is for 2002-03 1 US$ = Rs 44 In keeping with the increasing demand for road transportation, the National Highway Authority of Indian (NHAI) has been strengthening and widening national highways in multiple phases. As part of the National Highways Development Project, the work on the development of golden quadrilateral (connecting Delhi, Mumbai, Chennai and Kolkata) and the North-South and East-West links were started in 1998.It will build 13000 km expressways that would connect the nation (Surabhi, 2006). NHAI is investing about $650mn towards the development of an Intelligent Transportation System (ITS) which will make transport services on the highways (like reducing congestion, advance signaling, medical assistance, accident management, etc. ) efficient and automating many processes like toll collection etc. (Sanjai, 2007). Because of the growing opportunity and potential for high revenue, the Ministry of Railways has been taking measures to expand the rail connectivity and recapture the market share of freight business.By focusing on improving wagon utilization, the Railways have managed to reduce the freight cost from 61 paise2 per net tonne km (ntkm) in 2001 to 56 paise per ntkm in 2005 (Rastogi, 2006). At present, goods train run on same 2 100 paise = 1 Rupee W. P. No. 2007-03-07 Page No. 10 IIMA INDIA Research and Publications railway tracks as passenger trains at an average speed of around 25 kmph (Gill, 2006). With the proposed dedicated west and east freight corridors, the goods trains are expected to run at 100kmph. The West and East rail corridor of 1469-km and 1232-km will be bu ilt with an investment of $2. 0 bn and $2. 40 bn respectively and will be equipped with the latest centralized traffic control systems (Acharya, 2006a). Indian Railways has also decided to collaborate with bulk users of freight transport to build the rail network in a Public Private Partnership (PPP) mode. The first project on this line comprises nine public and private sector companies that are building a 82-km rail line between Haridarpur and Paradip at a cost of $ 120mn (Telegraph, 2006). Recently several steel companies have also shown interest in linking iron and coal mines in Orissa with a 98-km rail line (Business Standard, 2006).Multi-modal transport in India was a monopoly of the Container Corporation of India till 2005. With licenses being given to 13 new private players (Acharya, 2006b), rail trade should improve considerably. In order to encourage trade by small scale industries, Indian Railways has started a â€Å"road-railer†system where container vehicles are c apable of running both on highways hauled by trucks and on rail (Guha and Sinha, 2006). In 199899, the Konkan Railway (one of the railway zones in South-Western India) pioneered the ‘roll-on, roll-off' (‘RO-RO') concept between Mumbai (Kolad) and Goa (Verna).Privately owned trucks are loaded with their goods which are driven on to a rake of flat cars and are carried (trucks and their cargo) to the destination. In 2005-06, the ports handled 456. 20 million tonnes of cargo traffic. This is expected to increase to 700 million tonnes by 2011-12. In keeping pace with the growing demand, the government plans to increase port capacities to around 1 billion tonnes per annum in the next six years (Raja, 2006). Under the National Maritime Development Programme (NMDP), the government is encouraging public-private partnership to build and maintain ports.This scheme will cover 276 port related projects at an investment of $12. 40 bn (Raja, 2006). With rising congestion levels at majo r ports and with high average turnaround time, the government has decided to develop minor ports in seven states to ease the traffic of major ports (Financial Express, 20006b). Tables 3 the operational performance of various ports in India – while there is an improvement in performance, the pace is slow. The estimated cost of this development is expected to be around $350 mn. Further, private sector is likely to invest $ 7. 67 billion over the next six years.W. P. No. 2007-03-07 Page No. 11 IIMA INDIA Research and Publications Table 3: Average Turnaround Time At Ports (in Days) Port Chennai Cochin Haldia Jawaharlal Nehru Kandla Kolkata Marmugao Mumbai New Mangalore Paradip Tuticorin Vishakhapatnam Average Source: IAEIS 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 CAGR 6. 40 5. 80 5. 30 3. 70 4. 60 3. 80 (9. 90) 3. 23 3. 10 2. 37 2. 19 2. 22 2. 33 (6. 32) 5. 21 3. 96 4. 01 3. 02 2. 87 3. 00 (10. 45) 1. 72 2. 48 2. 34 2. 28 2. 04 1. 84 1. 36 6. 15 4. 72 6. 55 5. 94 5. 06 4. 62 (5. 56) 6. 59 5. 50 4. 71 4. 47 4. 29 4. 7 (8. 75) 4. 30 4. 25 2. 04 3. 86 4. 47 4. 35 0. 23 5. 60 5. 20 5. 47 5. 06 4. 10 4. 21 (5. 55) 3. 80 2. 89 2. 73 1. 90 2. 35 2. 96 (4. 87) 3. 89 4. 16 3. 99 3. 37 3. 42 3. 41 (2. 60) 6. 39 4. 10 4. 11 3. 59 2. 59 2. 66 (16. 08) 4. 75 3. 71 3. 51 3. 72 3. 33 3. 20 (7. 60) 4. 84 4. 16 3. 93 3. 59 3. 45 3. 38 (6. 92) Currently, fifteen private sector projects are operational at various major ports and four more projects are under implementation (Raja, 2006). One of them aims to build the deepest port in the world at an investment of $ 1bn (Financial Express, 2006c).This project is handled by a three-firm Chinese consortium with a Mumbai-based partner, Zoom Developers. Interestingly, firms like Ambuja Cement have been using barges for transport of clinkers from their factories to crushing and packaging plants all over the coast, thereby, reducing transport costs considerably. It can be seen that there is a fury of activity in enhancing the in frastructure capacities in the country. 4 Determinants of Logistics Growth in India The Indian logistics business is valued at US$ 14bn and has been growing at a CAGR of 7-8 per cent.As mentioned earlier, the logistics cost represents 13-14 per cent of the country’s GDP. The market is fragmented with thousands of players offering partial services in logistics; it is estimated that there are about 400 firms capable of providing some level of integrated service (Mahalaksmi, 2006). The economy is expected to grow around ten per cent over the next ten years and sectors like chemicals, petrochemicals (especially distribution), pharmaceuticals, metals and metal processing, FMCG, textile, retail and automobile are projected to grow the fastest.New business models are emerging as new firms, both domestic and foreign, enter the market. As a result of the ensuing competition, linkages with global supply chains and domestic market growth W. P. No. 2007-03-07 Page No. 12 IIMA INDIA Resea rch and Publications promise to change the face of logistics industry beyond recognition. In this section, we discuss how these are going to determine the growth of the sector. The scale of operations in manufacturing is changing and so are their markets and sourcing geographies.Growth in manufacturing in India has happened across clusters that are located in different parts of the country, e. g. , Ludhiana, NCR, Baddi and Dehradun in North, Rajkot, Jamnagar, Pune and Mumbai in West (along with Ankleshwar, Vapi, Aurangabad, and Kolhapur and most recently Kutch), and Coimbatore, Vishkahpatnam, Bangalore, Hosur, Chennai, Pudduchery and Sriperumbudur in the South. Assembly plants at these locations are being fed with raw materials and intermediate products from all over the country and abroad (as well as these locations).Moreover, distribution networks with emerging hubs in Indore and Nagpur (i. e. , Central India) supply all over the country and abroad. This is going to increase the n ature and extent of movement of goods and services across the country. This has been accompanied by the expansion of domestic production capacity (e. g. , ORPAT in Morbi has added capacity to produce 40,000 units of quartz clocks and time pieces at a single location) as well as a big MNC entry into the Indian manufacturing scene (e. g. NOKIA’s new factory at Sriperumbudur produces 1 million mobile phones per month). As the volume of production grows, so will the extent of movement of goods either to the ports for export or to the rest of the country. Some of the large players to enter (or expand significantly) the Indian market recently have been Reliance Retail, Big Bazaar Hypermart, Pantaloon and RPG in Retail; Nokia, LG, Samsung, Motorola, Sony, Blue Star in Consumer Electronics; Bajaj, Hero Honda, Maruti, Honda, Toyota, Audi,Volkswagen, Renault, Volvo in the Automotive sectors; Holcim in Cement; etc. It can be expected that their operations will drive the growth of logist ics industry. The liberalizing Indian economy is experiencing entry of large domestic and global firms in new businesses as well as enlargement of distribution network of many regional Indian firms. The announcement of large retail projects by Reliance and Bharti (in collaboration with Wal-Mart) will bring new technology, add additional warehouse capacity and will require fast and reliable movement of goods across the country.Reliance is thinking of establishing large warehouses in Thailand to take advantage of low cost sourcing from South-East Asia once the Free Trade Agreement with Thailand (as well as ASEAN) gets finalized. Similarly, regional food & grocery retail leaders like W. P. No. 2007-03-07 Page No. 13 IIMA INDIA Research and Publications Subhiksha who are present very extensively in the South Indian market are now entering the rest of the country with more than 600 new retail stores in 2007. Their logistics strategy and needs are transforming very significantly with this nationwide expansion.New retail chains are entering the non-metro towns and non-State capitals. It may be mentioned that the growth of the courier industry post-liberalization has helped change the parameters of service evaluation in the industry from cost alone to cost, time, and reliability. This sector has also seen a number alliances between regional and local players especially in the small package (less than 500 grams) market thereby creating networks of small players who are not only cost effective but also more flexible than the large national players.This segment of the industry has taken advantage of the large manpower and is gradually moving away from â€Å"Angadiyas† or manual inter-city couriers to a more organized network that shares transport infrastructure (and even consolidates sub-packages from various small couriers in a single large courier bag to be transported by air cargo or road transport rather than these sub-packages being carried by several manual couriers on the train; the courier firms are gaining on service and are sharing fixed costs).The entry of large third party logistics (3PL) carriers like Federal Express and DHL and the expansion of domestic networks of Indian firms like Gati and Shreyas Shipping is also transforming the nature of services and the business practices across the sector. Table 4 gives an idea of the investment plans announced by the various firms for the coming financial year and gives a sense of their increasing activity. Another trend driving growth in this sector has been the consolidation amongst the logistics player.Mergers & Acquisitions amongst Indian and MNC logistics firms is starting to increase the reach of MNC 3PLs in the domestic Table 4: Investment Plans of Major 3PL Service Providers Firms DHL TNT Gati *Shreyas Shipping and Logistics Investment Details/ Plans (2007-08) (in US $ mn) 260 115 200 350 Source: Baxi (2006), Sanjai (2006a) W. P. No. 2007-03-07 Page No. 14 IIMA INDIA Research an d Publications market while consolidating the business (e. g. , DHL acquired Blue Dart, TNT acquired Sppedage Express Cargo Service, Fedex bought over Pafex etc. ).Consolidation is expected to be beneficial to both the service providers as well as the consumers. Initially MNC 3PL firms were providing only custom clearance and freight forwarding facility to their international clients. With the logistics market growing we should see a shift in this trend. The complexity of managing the supply chain in the pre-consolidation era is illustrated through the following scenario at Nokia (Figure 3) . Logistics activity for Nokia’s India Hub was maintained by a large number of Figure 3: Typical Logistics Supply Chain of NokiaDHL, Panalpina Inbound logistics Nokia Hub in Sriperumbudur Gati, Blue Dart Domestic Outbound logistics UPS Warehouse in India Export Market International Outbound logistics DHL Source: Mishra et al. (2006 service providers. Coordination and handover was a problem at times. With DHL acquiring Blue Dart, it is now able to provide seamless end-to-end integrated supply chain solutions. Downstream distribution channels have also seen some consolidation.Manufacturing firms, particularly, in the FMCG sector have started to reduce the number of wholesalers (and at times, distributors) so as to increase the reach and consequently the returns to each wholesaler. This also induces them to invest in new productivity enhancing technology and effective managerial practices. Technology in the logistics chain is being upgraded bringing better visibility on customer off-takes (though an absence of cash registers and the accompanying regulatory discipline to avoid tax evasion stand in the way of automated data updation).Introduction of more efficient transport technology and mobile communication has the potential of changing the logistics practices in the industry. Increasing competition and the low penetration of IT also implies that the scope for change is immense and imminent. The agri-business sector’s supply chain, for example, has changed significantly with increasing investment in coldchains across the country. With this, fruits and vegetables are being transported long distances (often more than 1500 kms) and milk grid is able to pickup and deliver liquid W.P. No. 2007-03-07 Page No. 15 IIMA INDIA Research and Publications milk from and to remote areas more frequently. Here the role of cooperatives like AMUL has been exemplary both in increasing the size of the distribution network and also in reorganizing the supply network very efficiently along with enormous buildup of social capital – a pre-requisite for growth in emerging economies (Chandra and Tirupati, 2003). Low penetration of hand eld technologies for order processing and tracking, product tracking and material handling accessories, as well as IT for improved decision making can be seen as opportunities for growth. Mobile technologies also hold the potent ial for rapidly using information for real time decision making as well as for coordinating both the inbound and outbound logistics. Indian customers exhibit strong value and variety seeking behaviour hence developing capabilities in the process of product and service delivery will induce loyalty (i. e. , process loyalty).Government policies have been another driver of change in the logistics industry. The trend towards a higher road cargo traffic as compared to rail is going to require better logistics control and coordination. The golden quadrilateral road project and the east & west rail corridors are expected to change the reactiveness of Indian firms through shorter lead times as well as lower maintenance costs on the transport equipment. They also have the potential of reducing the procedural delays on highways by reducing the number of checks and related stoppages of vehicles.Its impact on perishable good will be most significant. Thirteen States and three UTs have already am ended the State laws allowing private sector participation in direct purchases of farm produce from farmers (Ahya, 2006) which is making procurement more efficient and is bringing better technology as well as products in the rural production and distribution network (e. g. , see ITC echoupal in the next section). Banks have developed venture capital funds for logistics players. Small Industries Development Bank of India or SIDBI, for instance, has invested $ 2. mn in the Mumbai based firm Direct Logistics (Baxi, 2006). The unbundling of the logistics supply chain (both the physical pickup, storage and movement of goods as well as allied services like invoicing, order management, freight forwarding, customs clearance, octroi tax management etc. ) will lead to business opportunities and add value to the customers. An interesting example is that of Reliance Connect Service Centres that have been established on Indian highways by Reliance industry along with petrol stations.The Connect Centres provide a place for truckers to relax (sometimes with overnight stay facilities), send information (including data) to parent firms on their location, completed transactions etc. , receive material/instructions from the firm, remit money to parent firm, W. P. No. 2007-03-07 Page No. 16 IIMA INDIA Research and Publications etc. It has become a one-stop shop for truckers and their companies to keep in touch. Similarly, once VAT is introduced, it will simplify the process of goods servicing and will lead to rationalizing of many operational decisions.The implication of the emergence of a strong service industry on logistics performance is not well understood. Perhaps, a new business segment will emerge that is technology driven and will help coordinate activities across business channels. For example, there is a need to integrate the flow of information, goods and services between a medical physician, a diagnostics center, hospitals & nursing homes, and retail medical outlets à ¢â‚¬â€œ all of which are un-coordinated independent entities at the moment.This could range from digital transmission of MRI scans from a diagnostics center to a computer to blood collection and delivery from physician’s various city centers to nursing homes/blood banks or directly to dispersed operation theatres. The role of a coordinating agency becomes, organizationally, valuable in such an environment. The need is to link physical logistics processes with communication technologies –building on the strengths of the IT and mobile communication industries. 5 The Renewal of the Sector: Some Innovative ExperiencesThere have been several instances of firms undertaking innovative re-design of their logistics systems or deployment of interesting business models to enhance the effectiveness of their networks in order to deliver value to their customers. Sometimes it was done to overcome an inherent disadvantage that may exist in the supply chain. In this section, we presen t a few such experiences both at the firm level and at the industry level, through brief caselets highlighting their innovative contribution. They also represent the renewal process that is transforming the logistics sector and the distribution strategy of firms.GATI3 Established at a time (in 1989) when firms in India hardly outsourced their logistics requirements, Gati has transformed itself from a cargo movement company to become one of the leading end-to-end logistics and supply chain solutions provider in India. Continuous innovation and high end technological investments to improve service 3 Source: www. gati. com, Sharma and Thakur (2006), Prowess (2006), Reddy (2007) W. P. No. 2007-03-07 Page No. 17 IIMA INDIA Research and Publications quality, speed and efficiency can be ascribed as the reasons behind their success.It is staring to connect with mass retail market in several cities through 1500 Customer Convenient Centres. It is also the first Indian company to operate in th e far-east market with its own subsidiary in Hong Kong. On the service front, there have been several firsts in India by Gati – a money back guarantee on cargo services, cash-on-delivery and a tollfree number for convenience of customers. Gati operates one of the largest road networks linking 594 districts out of a total of 602 districts in India at a turnover of $104mn in 2005-2006. It covers 3. 2 lakh4-km every day with a fleet size of 2000 trucks.Its automated shipment tracking ability has brought it closer to the customers – for example, the SMS based tracking system has allowed the customers to continuously get an update on the status of their consignment. Another feature also enables customers to get email based conformation of any delivery. Gati has also transformed the warehouse management practices in India with its modern system, WMS – a web based warehouse management system that provides both functionality and flexibility to customers in managing thei r warehouse operations. WMS enables Gati and its customers to track inventory status in real time.Along with its transportation related capabilities, this has allowed Gati to manage the entire outbound logistics (i. e. , warehousing, transport and dealer/retailer replenishment) of Blue Star for his home air-conditioning division. Order processing times and shipping errors have decreased and customer service levels have improved, as a consequence. Currently, Gati operates with 10 warehouses and plans to setup another 25 over the next three years at an investment of $100mn. It is designing these new warehouses with mechatronic systems that could lead to a paradigm shift in warehouse management in India.It has implemented CRM and ERP systems, using IT to full advantage delivering value to the customers. AMUL5 The Kaira District Milk Cooperative Union or better known as AMUL was established in 1946 in Anand in the western State of Gujarat with an aim to remove the intermediaries in the milk procurement and distribution process and thereby increase return to milk farmers. The milk farmers were mostly marginalized members of the society and most of 4 5 1 lakh = 100,000 www. amul. org; Chandra and Tirupati (2003) W. P. No. 2007-03-07 Page No. 18 IIMA INDIA Research and Publications hem barely poured a few litres of milk each day. They, however, depended on this for their livelihood and any money lost to the middleman or to uncertainty in the environment meant a threat to their existence. Thus was born AMUL (which means invaluable in Hindi)! The Story of AMUL is an extraordinary story of vision, effort and power of networks for the benefit of the poor. From being a net importer of milk in 1947 when India became independent, India has now emerged as the largest milk producer in the world. This remarkable story has been scripted by a network of cooperatives called AMUL.The AMUL network is coordinated by the Gujarat Cooperative Milk Marketing Federation (or GCMMF) which markets milk and milk products that are produced by 12 Milk Unions (each having several factories) one of which is AMUL at Anand. The Unions are spread in twelve districts of Gujarat. Each Union collects milk from farmers through cooperative Village Societies. (This structure is now replicated in almost all the States of India. ) In 2005-2006, GCMMF had a sales turnover of $860mn through milk and milk products (its Unions or plants produce 15 categories of milk products with several products in each category).The 12 Unions collect about 6. 3million litres of milk every day from 2. 5 million farmers through 11,962 Village Societies. (with an annual collection of 2. 28 bn litres in 20052006). Each village society may have 100 to 1000 member farmers who pour milk twice a day. Twice daily, about 500 trucks collect milk from these Village Societies and bring them to either of the five chilling centers or the processing plants (or Unions). The Unions process the liquid milk – produ ce milk of various types for consumption, convert some to powder as inventory and use both powder and liquid milk for producing milk products.These products are distributed to consumers through a channel comprising 4000 stockists (or distributors) and 5,00,000 retailers. It is not difficult to imagine the complexity of coordinating such a network of perishable products with an explicit social objective, in addition to a commercial one. The network realized the need for a unique model to deliver value to customers and through that serve the key objective of setting up of the cooperative – making a producer out of a poor consumer and helping her get better returns. W. P. No. 2007-03-07 Page No. 19 IIMA INDIA Research and PublicationsBriefly, we will illustrate the unique mechanisms used by this network to coordinate the complex supply chain through the intervention of a number of third party service providers (distributors, retailers, logistics service providers and IT support groups). The network practices frequent delivery and works with low inventory levels in the chain, supported by extensive information network and IT kiosks at the milk pickup locations that provide a variety of services. Payment to farmers for RM procurement is instantaneous (well, almost! ) – during the same or in the next pouring shift by the Village Society staff.Milk is carried in cans by trucks (twice daily) or in chilling trucks, once in a day, to the plants. The routes of the trucks are well established and the arrival timetables at each Society well known and rarely is there any delay. This helps provide visibility to every member of the chain and improves the return on investment in the channel. The network operates with a zero stock out through improved availability of products and quick delivery. Disciplined planning to reduce variability at each stage helps in maintaining timeliness in the channel.GCMMF coordinates the production plan between the twelve Unions and ensures matching of geographic markets with supplies. TQM and Hoshin Kanri are the key tools used to plan and implement daily production and change programmes – these have facilitated a six-sigma performance throughout the network and has led to a doubling of sales revenue in the last ten years. Most interestingly, AMUL has the largest market share in every product category that it competes in – its competitors are both large MNCs and large & small Indian firms.AMUL illustrates how good managerial practices can help bridge the gap between profits for the supplier and low cost, highy quality products for consumers – all through exceptional coordination of logistics operations across an extensive network. AMUL operates with one umbrella brand for products from all its member Unions – a testimony to strong quality and cost coordination across all Unions and Village Societies. In addition, its has been singularly responsible for pulling out several million o f its members from poverty, ill health and illiteracy through its business model (called Anand Pattern) and social programmes.For details on this case study see Chandra and Tirupati (2003). W. P. No. 2007-03-07 Page No. 20 IIMA INDIA Research and Publications The DABBAWALLAHs of MUMBAI6 The â€Å"dabbawallah’s† or the ‘lunch box delivery people’ of Mumbai pickup and deliver lunch boxes from homes or restaurants and deliver it to the customer’s office – all within a specified time frame – and then deliver the empty box back to the place of pickup. It is an example of how processes can play an important role in coordinating logistics of an important service industry in India.The Nutan Mumbai Tiffin Box Charity Trust of Mumbai was established in 1891 to provide pick-up and delivery of lunch for Britishers working in Mumbai. Since then it has become the leading lunch delivery cooperative in the city. It picks-up and delivers 200,000 lunch boxes in a standard container every day and returns the same to the place of pickup. The firm has an annual turnover of about $12 mn and employs 5000 people for pickup and delivery – almost all of them are uneducated. However, there are less than 10 boxes mis-delivered or un-picked in a month!We discuss, briefly, the processes that help make this logistics network errorproof and deliver such an astonishing performance. The operations of the group has attracted global attention and won them many awards. They represent a growing group of service providers that exist as an element of the logistics network, provide niche service and generate value in return for the customer. The Trust which is organized as a cooperative is operationally organized in hierarchical teams – pick-up teams, consolidation teams, delivery teams (and then the reverse logistics for empty boxes with reversing of the functions for the teams).Typically, each dabba or the lunch box passes through more t han four pair of hands and may be transported up to 60 km each way. Pickup is done between 7. 30am-9. 00am, delivery between 12. 00 and 1. 00pm and return between 2. 00-5. 00pm. These represent tight time-windows where a team of 20-25 members (and supervised by a team leader who also fills in as a pickup person in case of any absence) pick-up lunch boxes from homes – about 30 per pick-ups person. The boxes are carried in a specialized fixture on a bicycle to the nearest train station where the boxes are consolidated by destination.A consolidation team performs this task and carries the boxes (which may have been picked by members of different teams but need to travel to the same destination geography) into the train. Often tiffin or lunch boxes are un-loaded at intermediate train stations – re-consolidated with boxes coming from other locations (i. e, cross-docked) and carried on a third train to its 6 Lecture of Mr Megde, President of the Nutan Mumbai Tiffin Box Suppl iers Charity Trust at IIM Ahmedabad, 2003; Chandra (2004) W. P. No. 2007-03-07 Page No. 21 IIMA INDIA Research and Publications estination station. At the destination station, the lunch boxes coming from various origins/cross-docking destinations, are once again segregated by the building where the delivery is made. Finally, a delivery team picks up their boxes, i. e. , boxes that they will deliver to specific owners in specific buildings, carry them on their bicycles and deliver them in the office of the owner of the box. Later in the afternoon, the same person picksup the empty box and pursues the reverse logistics and the box is ultimately delivered at its point of origin – either a home or a restaurant.With this as the complexity, what may be plausible reasons for such low errors? Contextually, the group members see their role as very important – they are responsible for delivering food to their customers – socially, it enhances their commitment to their tas k and establishes a critical customer-service provider link. Operationally, the handoff is done successfully through simplification or breaking down of tasks, codification and repetition. The designed process is simple and easy to understand for each operator.More important, each operator has a limited yet definite role. This role is one of pickup, consolidation & transfer and delivery (and the similarly for reverse logistics). Each pickup operator does not pickup more than 25-30 boxes as that is the number of addresses etc. that he can remember accurately which helps in avoiding mistakes. The lunch box is enclosed in a standard container which carries a unique code for the destination station, the building where the box is to be delivered and the floor number in that building where the office of the customer is located.Each operator recognizes a limited set of codes that are relevant to him (and does not have to learn the entire coding scheme). And finally, repetition of the task ( i. e. , same pickup location, same place for cross docking, same delivery location etc. ) helps in making the task foolproof. Of course, what helps is the linear geography of Mumbai, the punctuality of trains, relatively stable demand and strong inter-dependence between operators. It is an example of how manual logistics systems can be organized to effectively deliver value to the customer.ITC e-choupal7 The e-choupal project was launched by ITC (a large diversified company with strong FMCG presence) in 2000 in the central Indian State of Madhya Pradesh (MP) to reorganize the distribution of soyabean in rural markets. Today e-choupal reaches out to Source: www. echoupal. com, Talk by the eChoupal CEO S Sivakumar at IIMA, 2003, Mitra (2004), MBS CS (2006) W. P. No. 2007-03-07 7 Page No. 22 IIMA INDIA Research and Publications more than 3. 5 million farmers in 31,000 villages through 5,200 internet enabled kiosks and now covers a variety of agri-business products.The e-choupal was a u nique venture which aimed to eliminate the middlemen from the agricultural commodity supply chain and reduce information asymmetry for the farmers. It is an extremely profitable rural distribution system with its unique design features. The e-choupal was started with an objective to re-organize the soybean trade which was operating in an inefficient manner. Farmers used to sell their produce through government mandated markets called â€Å"mandis. † Mandi trading was conducted by commission agents who bought and sold the produce.As the produce was sold through auction by these traders, farmers would find out the market price only upon arrival at a mandi. If the buyers had purchased enough for the day at this mandi then either the auction prices fell dramatically or the farmers had to wait for the next day’s auction. While all this may have been happening at one mandi, the farmers were unaware of the auction status at other mandis where there could have been shortages. The decision regarding the quality of the produce was also dependent on the trader.Similarly, distortions in price and quality effected agro-business trading firms like ITC who were, by government law, required to purchase from the mandi and through these traders and not directly from farmers. Under the e-choupal model, kiosks were setup in villages providing farmers information in local language on agricultural inputs, best practices in farming, market price realized at various mandi auctions, weather details etc. Nevertheless, it enabled ITC to purchase products directly from farmers (through a change in the law), enhancing quality of products and significant cost reduction (e. . , it saved $5. 40 per tonne on soyabean). The e-choupal now has just two service providers in its procurement chain – the sanchalak, a person between the kiosks and the farmers who inspects the produce and based on his assessment of the quality, the price of the commodity is decided (he gets 0. 5 p er cent commission on the volume sold) and samyojak, a person who manages the ITC warehouses (he gets 1 per cent commission on transactions). Samyojaks also handle much of the logistics at the procurement hub like storage management and transportation from the hub to processing factories.ITC was able to overcome the hurdles posed by infrastructure inadequacy in villages. It uses solar energy to power the batteries of the computer kiosks and has shifted from W. P. No. 2007-03-07 Page No. 23 IIMA INDIA Research and Publications dialup connection to satellite based technology (VSAT). Farmers are now able to make informed decisions as they understand the market better leading to higher productivity. Various seed and fertilizer companies are now able to reach wider market with lesser transaction cost.The e-choupal has provided a market for more than 64 companies (to name a few, Monsanto and Nagarjuna Fertilizers). This innovative direct procurement channel is a win-win mechanism for all the involved parties. ITC is now building a rural retail infrastructure on the foundation of the e-choupal network thereby changing the rural distribution landscape. Transforming the Auto-Component Replacement Supply Chain With changing government policies and consumer preferences, the distribution supply chain of Indian companies has been effected significantly. This poses new challenges for various channel partners.We illustrate this transformation process through the lens of the auto component replacement market supply chain and discuss its implications. We surveyed 21 manufacturers and 22 channel members (distributors, wholesalers and retailers) spread equally in Northern and Western clusters of auto component Industry in India for this purpose. The auto component industry produced parts worth $6. 7 billion (2004-05) with 57 per cent of the demand coming from the replacement market (ACMA, 2005). Low entry barriers have led to a large number of players in the replacement market.T here are about 400 firms in the organized sector and more than 5000 in the unorganized sector. Another feature of this sub-sector is the long duration of ownership of vehicles in India which leads to high requirement of parts. It is also found, anecdotally, that willingness to pay for parts decreases with the length of ownership. This has led to an intense segmentation of the parts market by price. Pre–1991, this industry was still in a nascent stage. It was characterized by few manufacturers and low demand. Consequently, the distribution network was flat (Figure 4a).Availability of spare parts was a key issue with long delivery lead-times and manufacturers sought large order sizes. This also led to the growth of un-branded parts or parts branded by regional producers (often supplied by small firms) in the replacement market. The product was sold chiefly on personal relationship with the buyer; quality, brand and price were not the selling propositions. Maruti Udyog Limited h ad created a W. P. No. 2007-03-07 Page No. 24 IIMA INDIA Research and Publications network of suppliers of quality parts for its vehicles.Hero Honda had done the same for its motorcycles. Post-1991, the liberalization of the automotive industry led to an entry of many foreign auto players. Because of the impending automobile industry boom and high margins for distributors, the demand for spare auto-parts was expected to grow. The distribution channel was modified with the entry of two more channel members, i. e. , wholesalers and semi-wholesalers (Figure 4b). The latter were smaller versions of the former and locally oriented. The period 1994-2007 saw a major transformation of the distribution structure (Figure 4c).OEMs started to operate in the replacement market through a parallel supply chain selling parts through their service stations. Additionally, the entry of large number of channel members caused semi-wholesalers to move out of the supply chain – they either moved up the chain to become wholesalers or moved down to become retailers. To strengthen the coordination of this extended supply chain and to buffer against the differential tax structure across states, companies started to operate with Carry and Forwarding Agents (C&FA). Transportation related activities are carried out by all the members of the supply chain.Manufacturers use services of 3PL for transferring their stock to C&FA and distributor locations. But thereafter, the transportation activity is solely managed by channel members themselves. An analysis of the available IT infrastructure and its usage pattern for all the channel members in our sample survey indicates that there is a high deviation in the usage of IT in the replacement market supply chain. Eighty seven per cent of the sampled firms use an ERP package – most of which is customized and developed locally. The main impediment in the use of a branded packages is the high cost of purchase and mplementation. These pac kages are used to generate sales report, order from suppliers, account for the financial transactions and track the level of inventory at plant and C&FA. Manufacturers order the stock from suppliers mostly through emails. In order to track inventory in the channel, firms also made IT investments both at C&FA and within the firm. Linking the C&FA to the company website enabled firms to check stock status at the C&FA and reduce the order processing and customer response times. Larger firms are also providing a similar setup to their distributors.Since the C&FA is mostly owned W. P. No. 2007-03-07 Page No. 25 IIMA INDIA Research and Publications and managed by the firms, manufacturers are also able to check the inventory status, dispatching status and customer records. Distributors have invested primarily in computers for keeping track of the inventory and updating accounting details. On the other hand, rest of the channel partners (wholesalers and retailers) don’t even own comp uters. Parts are ordered primarily on the phone. Interestingly, most distributors were found to be following periodic review olicy while the rest of the channel members were following continuous review policy because of their low sales volume. Post 2007, with the implementation of a uniform tax structure across all states, there will be some changes in the way firms operate. The C&FA will, perhaps, become redundant as most manufacturers will prefer to deal directly with distributors. The concept of an exclusive distributor is expected to vanish. It is expected that with the increase in variety of components, distributors might become wholesalers and will stock multiple brands for the same product.Two parallel distribution channels are expected to be in operation – the OEM chain and the non-OEM chain (Figure 4d). OEM network will primarily handle the passenger car replacement parts and the non-OEM distribution network will sell parts for Light Commercial Vehicles, Heavy Commer cial Vehicles, 2-wheelers and 3-wheelers as the car customer is becoming more brand conscious even while replacing parts which comes along with superior service. Further, we perceive that the more advanced automobiles, Free Trade Agreement with other Asian countries and VAT are going to change the way the replacement market operates.There will be a rationalization of this market in terms of number of firms competing thereby leading to an improvement in quality, delivery time and availability of parts. The size of the firms is expected to increase with an emergence of large national players (in addition to OEMs). This may reduce the number of producers exclusively focusing on the local markets. W. P. No. 2007-03-07 Page No. 26 IIMA INDIA Research and Publications Figure 4a Manufacturer Figure 4b Manufacturer Distributors Distributors Retailers Institutional Buyers SemiWholesalers Wholesalers Institutional Buyers RetailersGovernment Agencies & Transport Companies Garage-station Govern ment Agencies & Transport Companies Garage-station Vehicle owners Vehicle owners Figure 4c Manufacturer Figure 4d Manufacturer Institutional buyers C&FA OEMs Institutional buyers OEMs Wholesalers Distributors Authorized Service Stations Authorized Service Stations SemiWholesalers Retailers Wholesalers Vehicle Owners Vehicle Owners Retailers Government Agencies & Transport Companies Garage-station Government Agencies & Transport Companies Garage-station Vehicle owners Vehicle owners W. P. No. 2007-03-07 Page No. 27 IIMA INDIA Research and Publications Challenges Ahead Several challenges remain before the Indian logistics sector and its future success will depend on the ability of the industry to overcome these hurdles. Some of these impediments are at the firm level while others are at the policy level. At the policy level, the issues of infrastructure and integration of the nation’s logistics network remain the two most critical areas that require attention. The growth of inf rastructure, since 1991, has been quite extensive (covering a wide geographical area) as well as strategic – linking the key industrial, consumption and transshipment centers.However, some imminent weaknesses need be addressed. Movement beyond the golden quadrilateral is required to bring goods from upcountry production sources to main shipment centers. The rate of growth of expressway has to increase. Poor road conditions increase the vehicle turnover, pushing the operating cost a

Oedipus: the Fate of Poweruful a King Essay

Imagine being a hero, and your destiny is to kill your father and marry your mother. This is Oedipus’s fate. When he was still a baby, his parents heard of the prophecy they had a shepherd take Oedipus to Kithairon to die. There the shepherd gave the baby to another shepherd from Corinth, where Oedipus was given to the king and queen. In Oedipus Rex by Sophocles, Oedipus proves himself to be a tragic hero by exhibiting the four traits of a tragic hero; goodness, superiority, tragic flaw and tragic realization. Oedipus has goodness, the first trait of a tragic hero. Oedipus is determined to solve the problem in Thebes, and declare to Creon that â€Å"once more [he] must bring what is dark to light† (9). Oedipus is saying that he wants to do what is good for his country. He is good because he has already saved Thebes once and he wants to save Thebes again. Later, Oedipus is talking about his wife with Creon and says, â€Å"Everything that she wants she has from meâ€Å"(31). Oedipus is telling Creon that he provides for his wife, not only Thebes. This shows goodness because he cares for his family, not only his country. Oedipus’s goodness may help him now, but his superiority may not help him. Oedipus’ second trait is superiority. The priest proclaimed â€Å"Great Oedipus O powerful King of Thebes! (4)†. The priest is saying that Oedipus is basically one of the best kings Thebes ever had. This shows that Oedipus is superior because people think highly of him. Oedipus asked Teiresias to come to him to help solve the problem. Teiresias is hinting that Oedipus killed Lais, Oedipus got mad at him, so Oedipus starts comparing himself to Teiresias, â€Å"wealth, power, craft of statesmanship, kingly position, everywhere admired† (21), unlike Teiresias. Oedipus is saying that he is better than the rest, since he is king. This proves that Oedipus prides himself and thinks he is better than the people in his country. Superiority is something everyone should have, even heroes; but some also have flaws. Oedipus has hubris, which is his tragic flaw and it led him to his end. Oedipus thinks â€Å"Creon, whom [he] trusted, Creon [his] friend, for this power Creon desires on secret to destroy [him]† (21), when Teiresias told him about Laios’ death. Here Oedipus is accusing Creon of trying to destroy his power. This shows his pride because he is blinded by his arrogance and can’t see that it’s his fault. When pride still blinded Oedipus, he would keep on asking questions about his birth, he’d tell his wife of â€Å"Go on of you, and bring the shepherd here† (57). Oedipus needs the shepherd that could help find out more about his birth. This explains his pride because he keeps asking questions and still can’t see the answer while Iocosta already found out what really happened. His flaw that blinded him and led him to realize something, he was wrong the entire time. The final trait Oedipus has is tragic realization. When Oedipus realized what was happening and that he was the one to blame, he told everybody for the last time â€Å"O Light, may I look on you the last time! I Oedipus, Oedipus, damned in his birth, in his marriage, damned, damned in the blood he shed with his own hand† (64)! Oedipus realized that he was wrong the whole time and that he was damned in his birth. This shows that even though he was a hero, his pride was there more that it should have been and it made him fall hard. â€Å"No more, no more shall you look on the misery of my own doing! Too long have you known the faces of those whom I should never have seen. Too long been blind to those for whom I was searching† (69). These were Oedipus’s last words. He was looking for a sword and when he saw Iocasta dead, he took her brooches and poked his eye out, because it was a greater suffering than just death. As you can see, Oedipus realized everything he had done and he had to punish himself. You can see that even though Oedipus was a hero, his pride ate his soul more than it should have and it caused himself to poke out his eyes. So you know that Oedipus has the four traits of a tragic hero. Now think about your flaw. Does it make you fall, or you can’t see what’s right in front of you because you are too blind to see it? So don’t be like Oedipus, don’t let superiority and tragic flaw lead you to defeat.

External and Internal Factors

Management is a universal concept because its principles and techniques are used all over the world, irrespective of their level of development. The basic objective of the management is the progress of people and not the direction of things. The conservative explanation of management is obtaining work done through its people, but the factual management refers to the development of people through work. The management should make the difficulties interesting and their solutions productive for the team members so that everyone can deal with these situations. Management has to provide effective leadership, promote team spirit, set in motion bilateral and multi-lateral channels of communication and enroll the participation of its people, commitment and contribution through an appropriate system of financial and non-financial incentives. Functions of Management The four basic functions of management are planning, organizing, leading, and controlling. The internal or external factors of an organization influence the ongoing process of an organization. They create an impact on the above-mentioned functions of the management. An impact of these internal and external factors will help in modifying the organization culture. Planning refers to designing policies and procedures to build up production or service capabilities, or to diversify its business and extend its existing capacities. Organizing refers to as the management of resources – material and immaterial. Once a plan is made, it comes to the implementation phase. Further it moves toward the leading phase. To have a desired result, creative strategy is appropriately monitored and evaluated. Globalization The combination of national economies into an international economy through various deals between the different countries along with the foreign direct investment all refers to globalization. Proper planning and organizing have to be done while planning for globalization. It involves various material and immaterial resources to be used in exchange of the interrelated processes between the borders. To understand the impact of internal and external factors, the example of AT&T is taken. American Telephone and Telegraph Company (AT&T) is the largest fixed telephone company in the United States. The American Bell Telephone Company established AT&T in 1885. According to AT&T (2007), â€Å"Today’s companies are realizing that growth abroad must be supported by corresponding IT investments† (Convergence as a global competitive driver, Para. 13). When globalization is in play, AT&T uses platforms as a planning key because organizations are seeking to maximize their voice and investments; trying to reduce their communication costs. AT&T will stay organized by integrating multiple communication channels and increasing the richness of communications to the people who need it. Integrating the companies, which are working with AT&T, will be able to arrive at decisions in shorter time and enhance their workflow. In leading in globalization, AT&T has experts who have in-depth consultancy and experience to relate technology to business quickly; this leading will keep AT&T in control by forming tighter lines with their customers, partners, and vendors. AT&T can delegate globalization responsibilities by using services they provide and distribute it through there strategists, engineers, and specialists who can help achieve their goals in globalization. Technology One of the most revolutionary technological advances of the time is the Internet. Our corporate and personal culture quickly became dependent on this technology and has influenced every other aspect of lives, but eve n more so for AT&T. Cell phone companies are racing to keep up with the growing demand from business and individual customers who want, and need, to be connected continuously. When a new technology or an up-graded version is adopted in an organization, it affects the existing planning. The new modifications have to be done so that the new technology adopted fits in and is aligned with the organization. To carry out for each of the norms of the company and to be periodically evaluated needs to be done properly. AT&T has remained on the border of technology, because of its inception in 1877 as The Bell Telephone Company, the predecessor of AT&T (AT&T, 2010). Today, these new technologies vary from IP network management to automatic speech recognition and next- generation text-to-speech products. To maintain this impressive record of innovation, takes thorough planning, and vision. AT&T is equally committed to the bond they the share with one another and their customers; their focus on technology leadership and innovation; and a culture of commitment (AT&T, 2010). These high-tech gadgets have made it possible for professionals to stay connected to work anytime, anywhere via cell phone, personal digital assistants, smart phones, and laptops. However, â€Å"using technology effectively is more than a matter of learning new skills; it also involves making judgments about when and where to apply the technology for maximum benefit† (Bateman & Snell, 2009, Para. One p. 9) Innovation  Innovative systems and processes need proper planning and organizing. The requirements of the innovative system should be properly managed and taken into consideration. Also new creative ideas should be developed in the organization and properly monitored so as to create liveliness in the organization and avoid monotony in the system. The four factors of management extensively come in to play when concerning innovation. When AT&T has a new product is being advertised there are many procedures that need to be done. First, planning on how they are going to advertise the new product can truly make or break the sales of the device. When planning a big sale, the company needs to organize how they will handle all the extra people coming in. They may need to have more people on staff and organize how they will all the extra products until they have sold them. They also need to know how to keep all the plans for the sale organized to make sure everything is done for the sale. Innovation is not new for AT&; new products and new service plans seem to come out all the time. A good manager needs to lead and control the situation and store when the business has large sales of new items. A good way that they can do this is to delegate some of the work to other employees. If the managers have the employees do tasks that they can handle it will make everything run more smoothly. Making sure that everything is ready for the sale of a new product is the manager’s job and by delegating work to others helps in making sure that everything needs to be finished in a timely manner. This is when leadership and control come in handy. Managers need to have positive leadership with their employees and control to make sure everything is done correctly. Diversity  One of the primary internal factors from the four functions of management at AT&T is the diverse demographics of its workforce. Demographics are defined as â€Å"measures of various characteristics of people who make up groups or other social units† (Bateman & Snell, 2009, Para. Three p. 56). Demographic classification categories include characteristics such as age, race, religion, gender, family size, national origin, sexual preference, income, education, and geographic location. AT&T executive acknowledge that the diversity of its workforce better enables them to meet the demands of its diverse customer base. In support of this philosophy AT&T has planned for workforce inclusion, community involvement, multicultural marketing, and supplier diversity (AT&T, 2010). To build a dynamic organization, AT&T invested 244 million in training programs and 1. 2 million in health care and retirement benefits. AT&T also supports workers union affiliations, providing avenues for workers to negotiate fair wages and benefits and actively participate collectively in negotiations (AT&T, 2010). Management is proud to lead a diverse workforce, of whom 41% is female and 38% is of ethnic origin. Reward systems are performance-based and employees are provided with opportunities to develop their professional careers through initiatives such as Talent Development Program and Accelerated Development Program. AT&T management recognizes that talented and dedicated employees can be inspired to achieve team and organizational goals (AT&T, 2010). Control of the management functions are exercised by carefully monitoring performance and implementing changes when necessary. For example, AT&T requires, and assists diverse suppliers to include global strategies, such as supporting minority, women, and disabled veterans business enterprises. Ethics Ethical dilemmas are very common these days. The management needs to take proper tools to plan and control it. The manager should possess the delegation skills that mean that he should be acquainted with the ability to get the work done by using the skills, abilities, and time of the other people. It has been quoted that â€Å"effective delegation is a vital survival skill for supervisors and managers† (Effective Delegation Skill, 2002). Managers can use delegation skills for enhancing productivity, imparting training, reducing workloads, etc. The impact of globalization requires the approval of the top management. At this level, there is a huge possibility of taking a firm decision. The guidance of state or local federal agencies is also required. When organizing, the basic tasks of the managers are to manage the planning and the monitoring phase in a way to obtain the set goals. Managers in the innovation phase can take decisions related with the new up-gradations and technologies to be used. The managers at the top level should keep a proper check on each level of the management. Every phase should be properly managed and an effective decision has to be taken at each level. References http://www.time-management-guide.com/delegation-skill.html

Database Applications Essay Example | Topics and Well Written Essays - 500 words

Database Applications - Essay Example A data mart is an easy data warehouse that focuses on one area of functionality or subject like finance, marketing and sales. A single department builds and controls a data mart for the whole organization. The sources of data mart ranges from external data, central data warehouse to operational systems. The implementation of a data mart takes place in a series of steps. The first step involves the designation of the schema that initiates the data request. The construction of the physical storage before populating the data mart with source systems data follows. One then accesses the data for initiating sound decisions. Finally, there is the management of data over time. Data mining analyzes data from diverse perspectives before summarizing it into useful information. Useful information is capable of minimizing costs and increasing revenue or doing both. The analysis of data requires the application of data mining software as an analytical tool. Data mining ensures analysis of data from different angles and dimensions. It also helps in categorizing and shortening the relationships of the data identified. Data mining seems to be a new term though it is not technologically. Over the years, many companies have applied the technology of data mining to sort through through supermarket scanner volumes besides conducting market research data analysis. Business intelligence is a blanket description of all the software applications use in the analysis of the raw data of an organization. The discipline of business intelligence comprises of reporting, online analytical processing, data mining and querying. It plays a crucial role in the improvement of decision-making, cutting costs and the recognition of new business opportunities by enterprising organizations. Besides, it can help the management of business organizations in the identification of those business

Exploring Professional Ethics in Accounting Dissertation

Exploring Professional Ethics in Accounting - Dissertation Example This paper illustrates that the number and the fiscal enormity of the corporate scandals and collapses of the late 1990s and early 2000s have inspired numerous theories about what went wrong, where the fault lies and with whom. Business points to the accounting profession whose mission is to audit the financial presentations of management and issue an opinion about the relative fairness of that presentation as whole. The accounting profession has pointed to the changing business environments and the conflicting demands that it has placed on the profession. The accountants have evolved from their role as the â€Å"watchdog† employed by ownership in the 19th century British corporate model to their own multinational corporations themselves representing the independent audit and attestation role, the tax advocacy role, a management consultative role, as well as the provider of many primary accounting and reporting services for clients. The pressures of business and market demands on independent public accountants as well as the conflicting roles that they are called upon to perform has led the profession to defend itself with a sorry â€Å"my clients made me do it† defense. The United States government has responded to these corporate scandals with the passage of the Sarbanes-Oxley Act of 2002. This Act contains the most significant reformation of accounting and public reporting standards since the Securities Act of 1933 and the subsequent Securities Exchange Act of 1934. (Thomas, 2004). Intrinsic to the Sarbanes-Oxley Act is the restructuring of public accounting firms that removes the confusion in the role required of the public accountant. In addition, however, the Act has mandated requirements of corporate ownership itself in the form of appropriately trained members of the Audit Committee of the Board of Directors of each public firm restoring much of the responsibility for management’s deeds to owners. However, as Thomas (2004) states, t here are also significant mandates in ethical behaviors of both industry and public practitioners. But critics of and from both sides all seem to agree that the academy ultimately has an important responsibility of its lack of ethics education to those paraprofessionals in its business and accounting programs. Ghoshal (2003) stated that â€Å"faculty members need to own up to their own role in creating Enrons. It is their ideas that have done much to strengthen the practices they are all now so loudly condemning†. It is reiterated by Merritt (2003) who stated â€Å"to clean up ethics in corporations, you have to start at the beginning of a career. Business school, that is.† These quotes are a representative criticism of business and accounting faculty members offered by many in the literature and popular press. It is that criticism of the academic programs and their teaching faculty that has inspired significant activity in business programs to incorporate ethics into the curriculum. 1.1 Background of the Study The demands for improvement in the ethics education of students preparing to enter the fields of both public and corporate practice have become strident as the reality of business and accounting standards are increasingly at odds with each other. The accounting profession is required to legitimize itself in a way that will restore public confidence in its primary mission. The perception of the role of the CPA according to the Securities Exchange Commission as well as the general public is to serve as a trustworthy guardian of the public interest regarding the proper presentation of financial reports of publicly traded companies. In fact, Briloff (2002) referred to the SEC requirement for an independent auditor’s attestation of companies’ financial statements as an exclusive â€Å"franchise† to the profession. However, in turn, that franchise obligates CPAs to fulfill their

Marketing junk food to children Essay Example | Topics and Well Written Essays - 250 words

Marketing junk food to children - Essay Example Junk foods are made up of sugary ingredients. Unfortunately, sugar is the cause of many diseases in the society. For instance, it is evident that too much sugar in the body in the form of starch result to obesity (Smith 431). Sugar is also associated with the occurrence of diabetes that is among the leading death causing diseases. It is as a result of this negative impact of sugar in the consumers’ health that Coric wrote the script and produced the movie â€Å"Fed Up.† It is crucial for appropriate measures to be taken in order to reduce the occurrence of nutritional diseases among young children. One of the best measures is for everyone to take part in the condemnation of junk food (Smith 431). In doing so, the marketing of junk food to kids in TV programs as well as their respective schools will be stopped. It is also advisable for the adults to learn about the production of junk foods so as to avoid buying them for their children. Additionally, it is crucial for the parents to inform their children on the negative effects of junk foods so that they can avoid consuming them in their

Human behavior Essay Example | Topics and Well Written Essays - 2000 words

Human behavior - Essay Example Thus individuals’ omissions either willfully or accidentally in their actions have contributed to devastating occurrences. Common place accidents such as leaving an iron box on, a dropped cigarette or an electric heater left too close to flammable material have been reported to be major cause of fire fatalities in private residences (Grosse and Malvern, 2004). Consequently, most cigarettes’ related fires begin as a result of the smoker’s carelessness. Similarly, electricity is another commonly reported cause of fire in residential places due to human errors. This has been explained by (Grosse and Malvern, 2004) as emanating from either blown fuses or over warming of hot plugs and sockets. Faulty electrical wiring with exposed naked wires in the wall due to poor workmanship has also been reported to result in short circuiting, consequently starting a fire. Moreover, numerous reports have variously faulted the habit of leaving appliances like lamps, ovens and even baby monitors unplugged for over 24 hours a day. Grosse and Malvern (2004) explain that these implements have occasionally shorted out starting a fire. In the same vein, leaving fireplaces and heating devices such as pots, burners, stoves and lighted candles unattended in rooms have frequently resulted in devastating consequences according to the views of Duncan (2005). Research findings have associated majority of these causes to particular rooms in private residences. Duncan (2005), Elaine (2000) and Grosse and Malvern (2004) have variously demonstrated that the kitchen is the number one cause of domestic fires since it contains numerous hazardous items like the frying pans that can cause fire easily. Furthermore, majority of the mentioned risky items are probably stored in the kitchen. Overloading extension cords in the bedroom with electrical devices such as electric blankets or warmers and heaters with no lab-approval have significantly increased fire risks in the bedroom

The Homless Essay Example | Topics and Well Written Essays - 750 words

The Homless - Essay Example 2011, or risk being arrested. This belies the earlier efforts and fanfare that city officials had for The Journey Home, a 10 year plan to defeat homelessness, under which several beds were provided for homeless women on the streets. Credibility of Source: Good, since it shows action taken by the authorities and the effect it will have on the proposed plan to end homelessness. The reasons for homelessness are also highlighted. The author, a college student, has addressed social problems before in other writings. The Baltimore Sun is a trusted and widely read source. Reasonableness and Clarity of Purpose: Good; the information presented is fair, balanced and objective. Both sides of the issue are presented, can be appreciated by general audience as well as homelessness advocates and affected population. Organization and Support: Fair, since claims can be supported by statistical studies and facts on the ground about homelessness in Baltimore. No bibliography, table of contents or index for this newspaper article. 2. "Homelessness Timeline."(2011). Leading Issues Timelines. 02 Mar 2011: n.p. SIRS Issues Researcher. Web. Accessed on 18 Dec 2011at http://sks.sirs.es.vrc.scoolaid.net/cgi-bin/hst-article-display?id=SNY5270-0-6545&res=Y&ren=N&gov=N&lnk=N&ic=N&method=&keyword=&sid=SNY5270-0-6545&view.x=117&artno=0000281999&translationtarget=ko&submitButton2=Translate This timeline chronicles the story of homelessness in the USA from 1729 to Feb 2011. The Panic of 1837 and 1873, the Bowery Mission, Hull House, Labor Department and Housing Commission studies are some of the events covered, including the Great Depression of the 1930s and its aftermath. The works of various housing commissions and efforts to establish low cost housing are mentioned. It is clear that the United States has been dealing with homelessness issues since colonial times. Many of the homeless end up living on the streets, which forces the Federal

Poetry Essay Example | Topics and Well Written Essays - 750 words - 14

Poetry - Essay Example Four stanzas characterize The Road Not Taken, each having five lines. The scheme of the rhyme in the poem is ABAAB. This means that the rhymes are masculine and strict, meaning that the speaker is in a dilemma to choose a path that is rarely used by people. The poem the road not taken has received widespread recognition based on which it reflects dilemma when an individual has to make a choice in life. Based on the simple words used in The Road Not Taken the author employs (â€Å"I shall be telling this with a sigh / I took the one less travelled by†), scholars stipulate that the poem is easy to memorize without the reader really understanding it. In the case of the poem, the persona stipulates â€Å"the passing here/ Had won them really about the same.† Ideally, the two roads â€Å"that morning/ In leaves no step had trodden black.† This means that in the case of the two roads, one of them is less travelled. As such, it is inappropriate to ignore the after-effects prevalent based on the way in which they are portrayed in the poem, since the persona is unsure on the path in which he should follow. In this case, the speaker stipulates that â€Å"I took the less travelled by / And that has made all the difference.â €  The major attraction evident in the poem is the archetypal dilemma, meaning that the narrator cannot make the right decision on the path to follow. The reader encounters it both figuratively and literally numerous times and in an instantaneous manner. The paths present in the folks and woods reflect deep-rooted and ancient metaphors for a lifeline. In this case, the persona stipulates that â€Å"The roads diverged in a yellow road / To where it bent in the undergrowth.† They reflect crisis and decisions that one has to make in life. The similar folks are a symbol for fate and free will. People are free to choose anything, but they are unaware of what lays ahead based on the choice they make. The speaker states, â€Å"hen took the other, as

Kierkegaard Essay Example | Topics and Well Written Essays - 500 words - 1

Kierkegaard - Essay Example This aesthetic stage is criticized and held up as facile against the duty-bound nature of the ethical, but Kierkegaard did not favor one over the other. In fact, his progression of the self involved the transformation of the first two stages (aesthetic and ethical) into the third (religious) in such a way that they are both retained and yet, annulled. This higher synthesis is achieved through what Kierkegaard calls â€Å"absolute choice.† The absolute choice or decision that the individual makes at a point of crisis in their life is akin to the common phrase â€Å"leap of faith.† Both the ethicist and the aesthete find themselves questioning their mode of living at a certain point of time and it is here that Kierkegaard sees them as either taking the leap into the religious state or not. It is not necessary for the aesthete to pass through the ethical stage before reaching the religious state of Christianity, and vice versa although an individual may exist through both stages in the course of his lifetime. The decision to leap into religion, Christianity for Kierkegaard, is taken for different reasons by the ethicist and the aesthete. The aesthete, represented by A, detects irony in his lifestyle and in society around him. He is not unaware of the dangers and pitfalls of leading a hedonistic lifestyle.

Zara's strategic approach to Information Technology Management Essay

Zara's strategic approach to Information Technology Management - Essay Example Information technology management not only involves basic functions of management such as staffing and budgeting, but also has aspects like software design, change management, tech support and network planning that are unique to the management of information and technology only. Table of contents Executive Summary†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦...2 Zara’s Approach to management of information and technology†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.†¦4 Cisco’s approach†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ 8 Comparison†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.11 Conclusion†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦...11 References†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.12 Cutting back on cost is one of the most crucial aspects of the Zara Company’s approach to information and technology. This can be proved by the fact that the company tries as a much as possible to minimize cost in their information technology infrastructure. This can be seen in the way they handle their information technology needs. For example, the company prefers to develop their own programs rather than employing software developing companies to write their program or buying software’s. It is good to develop ones softwa re internally, but it has its limitation. In fact, what most companies do is to buy shell programs and then configure them accordingly to the suitability of their company. They do not develop their programs themselves from scratch. Although developing one’s programs internally like in the case of Zara has some advantages like ownership to rights of the programs, it comes with some disadvantages. Firstly when a company writes its own program from scratch and does not intend to gain from it commercially, they face they risk of being behind in technology. This can be proved by the case of Zara clothing company which as of 2003 the company was still using DOS operating system, which even its manufacturer Microsoft has termed it as well out dated (Macafee & Dessain & Sjoman, 2007). One reason why Zara finds it difficult to upgrade to another current operating system is the fact that it wrote its point of sale (POS) program specifically run on a dos operating system. Thus, as much as any management tries to minimize running cost as much as possible, quality should also be considered. This because in the long run cheap is expensive. Five years down the line, Zara Fashion Company will find itself in a lot of technical problems. This is because it will be left behind by other fashion companies since other companies are moving forward with the technology in regards to point of sale. If we look at Zara’s systems, after making transactions at the end of the day, one needs to back up the data in a floppy disk. However, in modern point of sale systems, information is backed up automatically in real time. This means that a good point of sale system should store information of any transaction in the main server immediately. Saving information each and every day is exceedingly tiresome and time consuming. Another disadvantage of this is that if one forgets to store the information in a floppy disk, then it means that information will never be retrieved hence caus ing problems in accounting. Zara’s approach to information technology management can be evaluated considering the ten principles of good information management and seeing if it satisfies these principles. Good information management should focus on adoption. This means information manag

Study design report & analytical planning and data analysis Essay Example for Free

Study design report analytical planning and data analysis Essay Part 2 STUDY TWO (Open file 1. 2. sav dataset) RESEARCH QUESTIONS: Factors related to birth weight outcomes specifically for this study: 1. Are there differences between three birthweight groups in maternal lead level? 2. Is maternal age at first childbirth associated with birth weight? BACKGROUND: It has been suggested by previous research findings that maternal blood-lead levels as an environmental factor is an apparent predictor of low birth weight; another possible explanatory factor of low birth weight relates to the maternal age of the mother. This study aimed to explore relationships between maternal blood lead levels, and maternal age (at first childbirth) with any observed differences in birth weight as a pregnancy outcome. METHODS: Life style information, maternal blood lead levels measured by micrograms per decilitre ( µg/dl), age of mother (years) and infant birth weight (grams) was collected from 250 consecutive (first-time) mother-infant pairs from hospital delivery departments in four Brisbane hospitals. Pregnancy outcomes (weight) were verified by consulting medical records. Lead was determined by electro thermal atomic absorption spectrometry (Whole Blood). Birth weight was recoded into three classes: Low birth weight (2500g); Lower end of normal (2500-3000g) and Normal (3000g). Additional notes: Lead exposure adversely affects the cognitive development and behaviour of young children . Regarding ‘LEAD EXPOSURE IN PREGNANCY’, according to the Centre for Disease Control (CDC), the acceptable blood lead level is 10 ug/dL. US Department of Health and Human Services, Agency for Toxic Substances and Disease Registry, 1999. . Write an unambiguous analytical plan to address the research question/s in the box above. Please note that the data required for this question are located on file1. 2. 1. What are the variables involved in answering the research question/s, e. g. independent dependant variables; In the first research question, the independent variable is the maternal lead level, while the dependent variable is birth weight of the infants. In the second research question, the independent variable is the age of the mother at first childbirth and the dependent variable is birth weight. 2. What is their level of measurement (type); All variables considered in this study birth weight of the infants, age of the mother at first childbirth and maternal lead level are ratio variables. Ratio variables are those which are measured on a scale where the distance from one point to another means the same things wherever the measurement is made on the scale. This scale is also characterized to have a true zero point representing the absence of what is being measured (Statistical Glossary, 2007) 3. Write-up the scientific hypotheses that you want to test to address the research question/s; The following hypotheses, stated in the null form, were tested at a 0. 05 level of significance : a. There are no significant differences in the means of the maternal lead levels when the infants are grouped according to birthweight. b. There is no significant association between maternal age at first childbirth and the birthweight of infants. 4. What tables (numerical) and/or graphs would you use to summarise the associations once the data are collected and analysed? Provide ‘dummy’ tables and/or graphs with appropriate labels; The following tables summarize the associations revealed from the test of the first hypothesis. Table 1. Significant Differences in the Maternal Lead Levels When the Infants are Grouped According to Birthweight based on One-Way Analysis of Variance (? = 0. 05). Source of Variation Sum of Squares Degrees of freedom (df) Mean Square F-value p-value Remarks Between groups 42. 492 2 21. 246 4. 350 0. 014 Significant difference in at least one pair of means Within groups 1206. 255 247 4. 884 Total 1248. 747 249 Table 2. Mean differences and p-values in the Maternal Lead Levels Among the Three Groups of Infants using Bonferroni Post-hoc Analysis Infant Groups Mean differences in Maternal Lead Levels (I – J) p-value Remarks I J Low birthweight Lower end of normal birthweight 0. 5952 0. 645 No significant difference Normal birthweight -0. 3895 1. 000 No significant difference. Lower end of normal birthweight Low birthweight 0. 5952 0. 645 No significant difference Normal birthweight -0. 9848 0. 011 Maternal lead level Significantly Higher in normal weight infants Normal birthweight Low birthweight 0. 3895 1. 000 No significant difference Lower end of normal birthweight -0. 9848 0. 011 Maternal lead level Significantly Higher in normal weight infants The following tables summarize the associations revealed from the test of the second hypothesis. Table 3. Relationship Between Maternal Age at Childbirth and Birthweight of Infants (? = 0. 011) Variables Correlation. Coefficient p-value Remarks Maternal age of mothers at first childbith (independent) vs. Birthweight of infants (dependent) 0. 18 0. 004 There is significant slight correlation between maternal age of mothers at first childbirth and the birthweight of infants. 1 Hypothesis was tested using 0. 01 level of significance. Results of the test of hypothesis that â€Å"There is no significant association between maternal age at first childbirth and the birthweight of infants† is shown in Table 3. 5. Provide a statement of the statistical test(s) that will be appropriate to test the hypotheses; To test the hypothesis that â€Å"There are no significant differences in the means of the maternal lead levels when the infants are grouped according to birthweight†, the best statistical treatment to use is one way Analysis of Variance ANOVA at a 0. 05 level of significance. When the computed p-value, which for this study is 0. 014 is less than the level of significance, which is 0. 05, there is significant difference in at least one pair of means. To evaluate, which of the means differed, a post-hoc analysis is conducted. Since there are only three groups, the conservative Bonferroni multiple comparisons test is applied. P-values from the post hoc analysis indicate which of the pairs of mean differed. To determine which of the two means that differed is actually higher, either the descriptives which shows the means of the groups or the mean difference in post-hoc analysis results may be used. To test the hypothesis that â€Å"There is no significant association between maternal age at first childbirth and the birthweight of infants† correlation analysis is employed at a 0. 01 level of significance. The resulting value of the correlation coefficient was interpreted using the following table : Table 4. Interpretation of Pearson’s Coefficient of Correlation (Monzon-Ybanez, 1997) Coefficient Range Interpretation 0. 00  ± 0. 20  ± 0. 20  ± 0. 40  ± 0. 40  ± 0. 70  ± 0. 70  ± 0. 90  ± 0. 90  ± 1. 00 Slight correlation; almost negligible relationship Low correlation; small relationship Moderate correlation; relationship substantial High correlation; marked relationship Very high correlation; Very dependable relationship Correlation is significant if the p-value generated is less than the specified level of significance. 6. Provide a list of assumptions that will need to be met to apply the test(s) validly; To validly apply ANOVA, the following assumptions must be satisfied : the distribution of the data to be analysed should be normal and there should be homogeneity of variance. Normality may be simply checked using Q-Q plots or with statistical tests like Kolmogorov-Smirnov or Shapiro Wilk. Homogeneity of variance is verified using Levene’s test (Becker, 1999). In a correlation analysis, relationship between the independent and dependent variables are supposed to be concurrent, or in other words, both variables are in the same time frame (Jensen, 2005). 7. Provide a statement of the levels of significance, that you will use to test each hypothesis; The hypothesis that â€Å"There are no significant differences in the means of the maternal lead levels when the infants are grouped according to birthweight† was tested at a level of significance (? ) of 0. 05. The hypothesis that â€Å"There is no significant association between maternal age at first childbirth and the birthweight of infants† was tested at a level of significance (? ) of 0. 01. 8. Finally, provide a sentence or two that you would present to the researchers to explain the results at both a descriptive (univariate) and inference (bivariate) level. Results of a one-way Analysis of Variance revealed a significant difference in the maternal lead levels among the three groups of infants grouped according to birth weight, with an F-value of 4. 350 and a p-value of 0. 014. Post hoc analysis via Bonferroni multiple comparisons test suggested that the mean of maternal lead levels of the group of infants with normal birthweight (4. 4052  ± 2. 37333) are significantly higher (p=0. 011) than the mean of maternal lead levels of the group of infants at the lower end of the normal birthweight (3. 4214  ± 1. 55170). No significant differences were noted on the other pairs of means. On the other hand, a correlation analysis performed at 0. 01 level of significance implied significant slight correlation (Pearson r = 0. 18, p-value=0. 004) between maternal age at first childbirth (32. 11  ± 5. 274) and birthweight of infants (3204. 47  ±620. 986). References Becker, L. (1999, July 7). Explore: Assumption testing for ANOVA.Retrieved April 11, 2008, from The University of Colorado at Colorado Springs: http://web. uccs. edu/ lbecker/spss80/explore2. htm. Jensen, A. (2005, August 10). Correlation Analysis. Retrieved April 10, 2008, from California State University, Sacramento: http://www. csus. edu/indiv/j/jensena/ mgmt105/correl01. htm. Monzon-Ybanez, L. (1997). Basic Statistics. Quezon City, Philippines : Phoenix Press, Inc. Statistical Glossary. (2007). Retrieved April 10, 2008, from http://www. statistics. com/resources/glossary/r/ratioscale. php. Statistical Package for the Social Sciences. (2006). Version 11. 0. [CD-ROM] Chicago, Illinois.