ACC revamps supply chain management

Kolkata: FOR BUDGET LINE: The cement bags are being unloaded from wagons at a Railway good shed in Kolkata on Wednesday. Looking ahead to increase the revenue model of Indian Railways a new policy was initiated to develop private freight terminals and setting up of logistics parks under Public-Private Partnership (PPP) mode. Mega logistics hubs alongside the proposed Eastern and Western Dedicated Freight Corridors, which was declared as "Diamond Rail Corridors" project of Indian Railways. But after going through several difficulties, PPP model of Indian Railways could not take off as it was expected and on other hand, safety and security of the millions of passengers have been surfaced after several horrific accidents and threats from the extremist groups in parts of the country. However, this year the Union Railway Minister facing a challenge to maintain her people’s friendly budget with a better package to the industry houses. Photo: Arunangsu Roy Chowdhury, Feb 23, 2011.

ACC Ltd. has embarked on an initiative to improve the efficiency of its supply chain, which include 10,000 trucks that carry cement from its plants to sales outlets across the country.

Transportation costs account for 35 per cent of the total sale price of cement and ACC, the subsidiary of Swiss cement major Holcim, hopes to bring down this cost by 4 to 6 per cent. ACC has deployed radio-frequency identification (RFID) and global positioning system (GPS) technologies to radically change the way cement is supplied to the market.

RFID has been deployed at its cement plants in Tikaria (Uttar Pradesh), Damodhar (West Bengal) and Thondebhavi (Karnataka). Over 400 trucks have been GPS-enabled so far. Within two years, 10,000 trucks and all plants would have GPS and RFID. This project, which is in its pilot stage, has yielded satisfactory results, and a veteran logistics professional has been hired to spearhead the initiative.

“Considering the huge costs involved in road transport, as well as to address the issue of time and asset efficiency, we embarked on a new journey 12 months back. Through automated and technology-enabled process we have improved the asset utilization in road logistics,” said Tushar Rameshchandra Dave, Vice-President, Central Logistics, ACC.

He said RFID and GPS would together increase the utilization of assets (trucks) which, in turn, would lead to freight savings and optimization of resources.

“Fixed costs of trucks will go down as the same number of trucks can now ship more cement in lesser time. A truck that was doing up to 4000 kms a month can now do 6000 kms. Apart from financial benefits, it will help in curbing pollution,” Mr Dave said.

“There is an increase in evacuation of 15-20 per cent and betterment of service levels up to 40-50 per cent,” he added. With RFID, a truck that was taking 220 minutes to drive from the entrance to the exit gate of a plant, is now doing it in 75 minutes.

RFID tracks the historical data of a truck and the time taken to go from the entrance to the exit gate of the plant. It is also helps in tracking the non-value added time. GPS, however, tracks the movement of a truck once it is outside the plant. “RFID and GPS together are ensuring better visibility of trucks and helping in complete transparency of operations,” Mr Dave said.