Supply Chain Management at Nicholas Piramal India
Case Study
Supply chain management (SCM) is one of the leading cost saving and revenue
enhancement strategies in use today. Pharmaceutical companies are increasingly
using this technique to improve the entire functional process. SCM has also helped
companies enhance their efficiency in managing resources and improving
relationships.
In the case of Nicholas Piramal, SCM has proved to be one of the most powerful engines of
business transformation. Since the company’s decision to enter the high growth contract
manufacturing and research services (CRAMS) segment, SCM has become key to the
company’s strategy. After the acquisition of Avecia (UK) in 2005, and more recently, Pfizer’s
UK Morepeth facility, the company’s ability to integrate over seas businesses and ramp up of
supplies becomes key to the profitability it’s CRAMS business.
Background
Three years ago, India’s fourth largest pharmaceutical company, NPIL, came up with a total
restructure plan. Post patent regime, the company identified CRAMS as a major growth
opportunity. With a slowdown in patented drugs sales and drying R&D pipelines, global
pharmaceutical companies are increasingly exploring low cost options for outsourcing research
and manufacturing. According to industry sources, the global pharmaceutical outsourcing
market, which currently stands at $24 billion, could reach $53 billion by 2010. Low cost
manpower and a large base of FDA approved plants, positions India high on the outsourcing
list, Suven Lifesciences, GVK Biosciences, Jubilant Organosys, Nicholas Piramal and Shasun
Chemicals & Drugs now featuring among the leading Indian players in this segment.
Custom manufacturing for innovator companies stands out as the most attractive outsourcing
opportunity for pharma companies. This market could reach, from an estimated $16 billion
Since this is a new product and market size can not yet be known, CMI’s ...
More new products need to be introduced and research needs to be done to find out which products will be most popular and profitable.
Research and development is a very important aspect of this industry and it is very draining on a company's funds. Great emphasis is also placed on product placement and marketing. Though these products are usually marketed towards industry professionals such as doctors and hospital management.
Kesavan, R., Mascarenhas, O. A., & Bernacchi, M. D. (2013). Outsourcing Services to India: A Review and New Evidences. International Management Review, 36-44.
...pital resources like distribution vehicles and storage warehouses should be outsourced to help reduce the high cost of operation which in turn can lead to reduction of its products price. The company should concentrate on product development and evolution and delegate distribution roles to outsourced firms. Such initiatives have worked well in the new Indian market and should be implemented in other areas.
Supply chain management is basically refers to the fundamental supply chain analysis of the organization which predominantly describes functionalities from source to the delivery point. In this process of delivery, supply chain management framework divides in four categories: In Planning the products and suppliers evaluated and selected, Sourcing pull the information process including contracting, ordering and expediting, Moving is a physical process from suppliers to end user and Paying is the financial process including payment and performance measurement.
In the late 1980's the rise of India outsourcing had its start. During this phase, India provided skilled contract workers for the US. Efforts to outsource projects to India arose in the late 1990's. This was driven by a combination of rapidly changing technologies and shrinking IT budgets Little by little the small offshore development projects started to multiply. In the beginning it was trial and error because there wasn't much focus on a repeatable and process driven model. During this time offshore outsourcing led to several failures. The big outsourcing force during the late 1990's came with Y2K. Work needed to get done quick and outsourcing to Indian companies was a solution to this. Indian companies had the ability to scale rapidly.
significant growth opportunity for eBay to capitalize on. eBay should also take its next 2 largest
This report has clearly in detail described the meaning, benefits as well as the need and challenges of the RFID in the supply chain system. While RFID comes with a larger magnitude of benefits than the bar code, it’s an expensive medium and comes at a price that may be prohibitive to many businesses. On the one hand, RFID is advantageous in different areas of the supply chain and does not require line-of-sight scanning; it helps in labor reduction, enhances visibility of products and processes , and helps in inventory management. On the other hand, RFID is an expensive solution, lacking benchmarks or standards, suffers from some adverse deployment issues, and suffers from major privacy concerns. However with the ultimate aim to see the establishment of item-level tracking which should act to revolutionize SCM practices, RFID is here to stay.
There are high entry costs to enter the market. The large industry competitors already have captured the market share.
Lean manufacturing and just-in-time processing are great business strategies that can severely stress a supply chain. The supply chain and supply chain management is a critical operations management element for any major company to succeed and remain competitive in the global market. The supply chain is one of many pieces critical to maximizing value to the end customer and requires close management to minimize external impacts. If a company is relying on another company to supply the raw materials needed for their production line, then impacts to this other company could impact their supply chain. Careful risk management is needed to optimize performance. As a company expands into global markets and global suppliers, this risk and management challenge is multiplied. The global nature of the company could impact important activities such as transportation, funds transfers, suppliers, distributors, accounting and information sharing. Disruption to the supply chain can significantly reduce revenue, cut market share, inflate costs and threaten production. A major disruption would have obvious impacts to profit, but could have additional intangible impacts to the credibility of the company if products are not delivered on time.
Give concrete information about the market you intend to compete in: current situations, trends, projections.
The key performance drivers of Supply Chain Management (SCM) are - facility effectiveness, inventory effectiveness, transportation effectiveness, information effectiveness, sourcing effectiveness, pricing effectiveness, delivery effectiveness, quality effectiveness and service effectiveness. These drivers include various performance markers that may be measured quantitatively by gathering information and applying them in SPSS. The works here may principally be quantitative with spellbinding measurable investigation. In the current world, practical supply chain management to help the triple primary concern, (nature, domain, and economy) is likewise included in the extent of supply chain performance drivers. This is relatively a quite new research region.
... and health insurance is expected to reach US$ 160 billion by 2017, as per the reports of Frost & Sullivan. India has tremendous growth in the health care industry with its expansion in both the private and the public sectors. According to a report by Grant Thornton India, the Indian medical device and equipment market is expected to grow around US$ 7.8 billion by 2016.
18. Rugman, Alan M. and Collinson, Simon. International Business 4th Edition. Essex : Pearson Education Limited, 2006.