1a) The supply chain of the petroleum industry is extremely complex compared to

other industries. It is divided into three different, yet closely related, major segments:
the upstream, midstream and downstream supply chains.

The upstream supply chain involves the acquisition of crude oil, which is the
specialty of the oil companies. Upstream process includes exploring for crude oil
deposits and the production of crude oil. Examples of firms that would belong in the
upstream segment of the industry include companies that own rights to drill for oil
and companies that provide support services to the drilling segment of the
industry. Royal Dutch Shell, Total S.A., Marathon Oil, ExxonMobil are examples for
companies with drill rigths and Halliburton, DMC Global, Nabors, NexTier Oilfield
Solutions, Borets, Weatherford, Arctic Slope Regional Corporation, Baker Hughes,
Schlumberger are examples of support service companies.

Midstream process involve the distribution of crude oil to refiners; the refining
of crude oil into saleable products; and the distribution of products to wholesalers
and retailers. Examples of firms that would belong in the midstream segment of the
industry include companies that transport oil by pipeline, truck or barge (e.g.,
Magellan Pipeline); and companies that refine crude oil (e.g., Tesoro).

Downstream process involves the retail sale of petroleum products. Gasoline

stations are perhaps the most visible downstream companies, but companies that
deliver heating oil or propane would also fall into this category.

1b) Information is crucial to the performance of a supply chain because it provides

the basis on which supply chain managers make decisions. Information technology
consists of the tools used to gain awareness of information, analyse this information,
and execute on it to improve the performance of the supply chain. Information is
essential to making good supply chain decisions because it provides the broad view
needed to make optimal decisions. IT provides the tools to gather this information
and analyse it to make the best supply chain decisions.

Information is a key supply chain driver because it serves as the glue that allows the
other supply chain drivers to work together to create an integrated, coordinated
supply chain. Information is crucial to supply chain performance because it provides
the foundation on which supply chain processes execute transactions and managers
make decisions. Without information, a manager cannot know what customers want,
how much inventory is in stock, and when more products should be produced or
shipped. To support effective supply chain decisions, information must have the
following characteristics: Information must be accurate, must be accessible promptly,
must be of the right kind, and must be shared.

Information is crucial to making good supply chain decisions at all three levels of
decision making (strategy, planning, and operations) and in each of the other supply
chain drivers (facilities, inventory, transportation, sourcing, and pricing). Information
Technology enables not only the gathering of these data to create supply chain
visibility but also the analysis of these data so that the supply chain decisions made
will maximize profitability. The abundance of data to develop information systems to
improve decision-making. Information can be a powerful tool if it is timely, accurate,
managed, and shared.

1c) A responsive supply chain is distinguished by short production lead-times, low

set-up costs, and small batch sizes that allow the responsive firm to adapt quickly to
market demand, but often at a higher unit cost. An efficient supply chain is
distinguished by longer production lead-times, high set-up costs, and larger batch
sizes that allow the efficient firm to produce at a low unit cost, but often at the
expense of market responsiveness.

The choice of responsive supply chain will be associated with lower industry growth
rates, higher contribution margins, higher product variety, and higher demand or
technological uncertainty. The interactions among these variables either can
reinforce or can temper the main effects. Lower industry growth rates are associated
with responsive market entry, but this effect is offset if growth occurs during periods
of high variety and high demand uncertainty. Higher contribution margins are
associated with responsive market entry and that this effect is more pronounced
when occurring with periods of high variety. Finally, we report that responsive market
entry also is correlated positively with higher technological demand uncertainty.

In supply chain, performance of pharmaceutical companies may it for human

or veterinary as a main player has noteworthy impact on supply chain management
efficiency. Identify the risk and prevent them in pharmaceutical companies not only
can lead to process optimization, productivity augment and plummeting business
risk, but also will help health systems to meet goals of supply chain management;
Accessibility, Quality and Affordability. Supplier qualification through a complex
process is very crucial to design right quality for the product and services. Every step
in this process is critical and needs to be followed. A good information practice that is
sharing of information between the supplier and the end user can lead to satisfactory
supplier qualification. By taking acre of above points the responsiveness and
efficiency can be managed.

2) Naïve forecasting is the technique in which the last period’s sales are used for the
next period’s forecast without predictions or adjusting the factors. Forecasts
produced using a naïve approach are equal to the final observed value. The naïve
forecasting method is the easiest of all methods and it is suitable for finance and
sales departments because it ensures that these departments work to improve the
company.

Consider the previous month’s sales and use it to forecast the sales for the next
period. Using MAD- Mean Absolute Deviation to compare the models, the Naïve
forecast method gives more accurate results with less deviation from production
values.
3)

Unit
Annual
Sno. Item Cost Category
Usage
(Rs)
1 Oil Filter 2200 150 B

2 Head Lamp 395 140 C

3 Fuеl Filter 270 95 A

Rod
4 1430 45 A
Bearing
5 Air Filter 860 120 B
 Wind
6 12000 90 B
Screen

7 Piston Rink 4500 250 A

8 Bumper 8000 110 A

Main
9 1130 120 A
Bearing
10 Bush 169 1160 C

A) In the ABC model of inventory control, items categorized under A are goods that
register the highest value in terms of annual consumption. It is interesting to note
that the top 70 to 80 percent of the yearly consumption value of the company comes
from only about 10 to 20 percent of the total inventory items. Hence, it is crucial to
prioritize these items.

B) These are items that have a medium consumption value. These amounts to about
30 percent of the total inventory in a company which accounts for about 15 to 20
percent of annual consumption value.

C) The items placed in this category have the lowest consumption value and account
for less than 5 percent of the annual consumption value that comes from about 50
percent of the total inventory items.

6) EOQ=srqt( 2*D*S)/H

As D=annual demand=6000

S=cost per order=4000

=2*6000*4000/10000

=sqrt(4800) =70

Hence the number of carrom boards the store manager should order in each replenishment lot
is 70.

Total cost = IC+PC

IC= 25000

PC=48000

Therefore total cost =Rs.73000