Sunday, February 16, 2014

Guest Lecture by Mr. Nitin Gokarn

Sunday afternoons are usually meant for sitting back and relaxing at home. But Sunday afternoon on 16th Feb was rather an exciting one for SIMSREE’ites. Because, they witnessed an industry stalwart unfolding his vast and profound work experience in front of them. An alumnus of 1979 PGDBM batch, Mr. Nitin Gokarn, visited back his alma mater on 16th February, 2014. He is currently working as Vice President of Supply Chain Management at Bharat Serum and Vaccinations. Prior to this, he has worked as Head- Supply Network Operations ( Logistics & SCM) at Merck Ltd, Head - WH, Distribution and CFA Management at Novartis and as Manager- Sales Admin and Distribution at Johnson & Johnson. He talked about ‘Supply Chain Management and its functions’.   

Mr. Gokarn began with the session on a note that accuracy and perfection are of utmost importance in Supply Chain Management (SCM). “In SCM, we need to be 100% perfect for being successful”; Mr. Gokarn Said. Gone are the days when SCM was only about warehousing. It now spans across various functions such as Manufacturing, Quality, Customer, Finance, Legal aspects etc. Hence, SCM is said to be the ‘Central Nervous System’ of any organization. 

Going deeper into the topic, he explained the factors that are important for raw materials and finished products from SCM point of view:-
Raw Materials Side
Finished Products Side
Procurement
Warehousing
Quality
Transportation
Negotiations/Pricing
Customer Order Processing
Raw Materials Inventory
Communication
Payables
Collections

The epic moment of the session was when Mr. Gokarn gave analogy of ‘Bhagwad Gita’ to put more light on SCM. As it is well known, Arjuna had fought the war against Kauravas in Kurukshetra. In that war, Lord Krishna was the charioteer and there were 4 horses driving the chariot. Mr. Gokarn associated every element of it with different terms in SCM. According to him, Arjuna was the ‘Logistics Manager’, Lord Krishna was the ‘Director’ and he termed 4 horses as four separate functions within an organization viz. Production, Sales, Purchase, Finance. He opined that synergy and collaboration among these 4 functions, as was there among those 4 horses, is necessary for the smooth and efficient functioning of an organization. Further, he gave different illustration about 4 horses. Those horses can also be termed as ‘When’, ‘Whom’, ‘What’ and ‘Where’; referring to ‘Timely delivery of the right good to the right person at the right address’. As a result of this, the batch was able to envisage altogether a new perspective about the functions in SCM. 


In today’s world, being lean and slim is of utmost importance. So how can any company be an exception to this? “No company wants to reduce the manpower in its sales department, as it’s a revenue function. So it tends to reduce manpower in the service area like supply chain”, Mr. Gokarn commented while emphasizing on the cost cutting measures taken up by the companies. Operating Costs, inventories, resources, budgets are always on the radar of an operations team within any company, as it tries to reduce the cost of all these factors. The main aim is to reduce the expenses on the non-productive and non-value adding factors and thereby increasing the productivity and hence profits.  But it’s rather a cumbersome task as an SCM professional has to face plethora of challenges; the prominent ones being forecasting accuracy, sales skew & space crunch, huge rise in property rentals, rising freight costs, tropical & humid climate, shortage of drivers, conflict management etc.  

As Mr. Gokarn has been associated with the pharma sector, he gave certain facts about pharma industry in India:-
India has the largest number of USFDA approved plants outside of USA
Though R&D hasn't been the core of Indian pharma industry, there is an intense competition within the sector
No. of wholesalers: - 55,000
No. of retailers :- 6,00,000
Interstate permits make the distribution of drugs within the country challenging
Pharma industry is growing at 12-13% and it is dominated by Indian companies
Price Control & Government Regulations are currently posing the greatest challenge to an Indian pharma industry

India is a second largest exporter of generic drugs to USA. Recently, USFDA (US Food and Drug Administration) has raised concerns over the substandard quality of drugs produced and exported by one of the plant of a renowned Indian pharma company. Also, it has slammed the doors of American market on the imports of generic drugs from that particular plant. This is a huge setback for the continuously growing Indian pharma industry. Fetching reference to this incident, Mr. Gokarn claimed that for any pharma company it is necessary to understand the concepts and practices suggested by the watchdog (USFDA) on manufacturing, clinical practices, quality assurance, quality control and data integrity, across the supply chain. “Do it right the first time” is the key for any manufacturing company.

By the end of the session, students had got a fair idea about SCM and about the important challenges faced by it and also the pharma industry in India. All in all, the Sunday afternoon proved to be worthwhile for the students of SIMSREE. They found the session to be highly informative, filled with lot of facts and real life examples pertaining to current affairs. SIMSREE thanks Sir for taking out time from his busy schedule and helping students understand the different aspects of SCM.

1 comments:

Thanks you Sir. A creative and insightful analogy to relate the Gita and SCH.

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