Just in Case Inventory not Just in Time Inventory

Today started off with a lecture on “Indian Suppliers meeting global standards” by Dr. R. Jagadeesh. It was interesting to me but at the same time repetitive to what I already learned in my operations management sciences class. I wish he would have spent more time on the international aspect of it and how it specifically benefits India. He touched on this only a little. One thing I found interesting that he said was how India has become the one destination outsourcing needs for companies. This just reinforces what I am learning in The World is Flat and the textbook how India is becoming the global business center of the world. He mentioned how out of the Fortune 500 companies, 220 outsource their software from India. All in all, it was an interesting lecture.


Following the lecture we went to Automotive Axles Limited. We listened to a presentation from the CFO which was very interesting. One thing that surprised me was that they do not do an inventory count or bring in auditors to check inventory. He said that the government has trust in these companies. Also they have inventory storage of 2 months just in case their customers need it. When asked about the costs associated with storing this inventory, the CFO responded by saying suppliers do not charge them unless they sell the gods which again shows the trust they have with each other. This says something about Indian culture how although it seems like Varma only focuses on the negatives of Indians in Being Indian, there is something good in Indian Culture and in my opinion essential to a well-run society; which is trust in one another.


After the presentation we toured the factory which was very interesting to see. I was amazed how many fumes surrounded the air and how many people did not wear any protection around their faces. It was interesting to see how India is definitely catching up to the United States in the technology realm. I have seen videos on Supply Chain Management in my Operations Management class, but it was really cool to see the real thing. The architecture came in following the tour and even gave more interesting information. One thing he said that I found interesting was the there are pros and cons of any location you choose to place your factory. For example, when he answered a question about where he would move the factory if he could, he said that’s a hard question to answer because on one hand he would say the center of India to better serve Automotive Axles Limited’s customers, but on the other hand he would also say Southern India because it has better workforce options. Below is a picture I took at the factory. Sorry it is not more exciting, but we were not allowed to take any pictures of the machinery.