Comprehensive Report: Logistics Management in Steel Manufacturing

This report provides an in-depth analysis of logistics management principles, using HG Metals Manufacturing Limited as a case study. It begins with an introduction to the company, its background, and key information. The report then delves into the core functions of a logistics manager, including the coordination of marketing, production, and finance processes within the supply chain. It explores the interfaces between these functions and the importance of efficient supply chain management. The analysis covers the order cycle, detailing the steps from product processing to shipping confirmation and the role of technology in monitoring the order cycle. The report also examines inventory management, including tag control and replenishment processes, and their impact on the company's operations. Furthermore, it discusses the manufacturing/production process, the flow of products, and cash flow within HG Metals. The report concludes by emphasizing the crucial role of the logistics manager in influencing business growth and the importance of proper planning, technology utilization, and customer feedback in maintaining product quality and increasing the company's success. References from the report are also included.

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Contents
Introduction...........................................................................................................................................3
Background.......................................................................................................................................3
Key Information................................................................................................................................3
The Interfaces........................................................................................................................................4
Order Cycle...........................................................................................................................................5
Inventory management..........................................................................................................................7
Conclusion.............................................................................................................................................8
References...........................................................................................................................................10
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Introduction
Background
The purpose of this report is to describe the various duties being performed by the logistics
manager of the company or an organization. In this report, we will discuss about the HG
Metals Manufacturing Limited, Singapore. First of all in this report, we will discuss about the
role of the logistics manager in the company and then we will study about the core function
of the overall process, i.e., about the production process being carried out in the company,
about the fields of marketing along-with the study of accounting and finance system of the
company (Team, HG Metal, 2017).
Key Information
HG Metals Manufacturing Limited is the manufacturer of steel products and it manufactures
a large variety of steel products from last forty five years in the country. HG Metals was
founded in the year 1971, and working from such a long time at present the company holds
approximately eight Lac square feet of the warehousing facilities. The company is
successfully carrying out its business in a large number of countries across the world and it is
capable of doing so with the help of its strong sourcing network with the other countries. The
company manufactures and delivers more than three thousand steel products among the
people all over the world. The company also offers several customized steel solutions to the
customers all over the world. The HG Metals has divided its whole business into three
different sections or companies, i.e., HG Distribution, HG Industrial Steel & Services and the
third one is HG Construction Steel. HG Metals were also listed on the Singapore Exchange’s
Main Board in the year 2004. The company has successfully attained this position by
maintaining good customer relationship as well as its supply network through its various
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representatives in the countries like Japan, Turkey, Russia and many other Eastern European
Countries.
The Interfaces
Working as a logistics manager in the company, the basic task is to coordinate all the
processes being carried out by the company such as, satisfying the employees, suppliers as
well as the customers of the company. The working of the logistics manager ensures the
success of the company’s business by selecting an effective and efficient the supply chain
management technique. Three core functional areas given in the case study, i.e., the process
of marketing, production and the finance process are actually the part of supply chain, which
are totally similar to the functionality of a logistics manager of the company or an
organization. Both the processes include similar types of task or responsibilities like issues
related to the environment, issues related to the transportation of the products from one place
to another and many other processes related to the delivery of the products from the
manufacturer to the customer on right time while ensuring all the safety procedures. The
logistics manager has to perform several important tasks like forecasting the requirements of
the customers and fulfilling them according to their need. Effectively evaluating the buying
patterns is also one of the most important tasks of the logistics manager/ supply chain
manager. It is the responsibility of the logistics manager to introduce new-new policies
related to the logistics activities and to modify these policies from time to time (Sin, 2014).
He/she needs to track all the processes continuously to meet the requirements of the
production staff and the customers. They need to introduce time to time training facilities for
the newly recruited staff and to introduce the new technologies as well with the help of
several models specially designed for the evaluation of the logistics services and programs.
The complete working of the logistics manager is divided into two main categories, i.e.,
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inbound logistics and the outbound logistics. Accomplishment of the several tasks like
purchasing the raw materials for the production of the products or we can say for the
manufacturing process comes under the inbound logistics. On the other hand, the tasks
related to the storage and delivery of the products across the world come under the outbound
logistics (Team, 2016). Working as a logistics manager in the HG Metals, I would classify
the whole working into different steps, which are as mentioned below:
 Manufacturing/ Production process – talking about this phase we can say that, the
company manufactures more than two thousand metal products and as a logistics
manager it is our duty to implement the material flow management theory for
evaluating the quality, quantity and the specification of the product needs to be
manufactured depending upon the demand and the sale of the product.
 The Flow of the product – as the name specifies, in this step the flow of the products
from supplier to distributors and further from distributors to retailers, etc. is being
monitored. Approximately 20% of the total products are plates, 30% are the bars,
19%are the beams, etc. therefore, we can say that all the marketing tasks like
forecasting of the products, services, etc. are carried out in this phase.
 Cash flow – in this phase the flow of the cash between the suppliers, manufacturer
and the customer is being carried out. Operating cash flow of the company is
approximately 2.67, whereas the free cash flow of the company is 5.16. By making an
effective use of documented reports, metrics and any other type of record can be
maintained easily.
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Order Cycle
It is the process in which the routing of the products from place to the other is being carried
out. The order cycle includes various steps like processing of the products, cycle actions, pick
and release of the products, shipping confirmation, etc. with the help of this cycle anyone can
check the current status of his/her products from anywhere and at any time. At present, each
and every company working on small, medium or large scale requires latest technology for
monitoring its order cycle. The insufficient forecasting of the products is one of the major
reasons due to which the overall performance of the company lacks behind. Therefore, for the
successful supply chain forecasting or we can say for the successful order cycle the trained
staff and the business based modelling are required (Oracle, 2015). Order cycle helps in
overcoming the mismatch, state between the demand of the products and the availability of
the products as well. The process of order cycle helps the management of the company in less
overstocking of the items or the products, which are already present in the stock. Further, this
helps in decreasing the loss of the company in manufacturing those products which are
shorter in demand, etc. for the future forecasting various logistical studies needs to be
implemented in the company like Qualitative forecasting techniques, quantitative forecasting
techniques, graphical forecasting techniques, etc. All these methods help in attaining the data
from the previous sale of the products depending upon the requirement of the products by the
customers across the world. The logistics manager can successfully accomplish all the tasks
by selecting optimal transportation facilities, equipment being used for the transportation and
by selecting chain based management system for the company. Working according to the
logistical theories it is his/her responsibility to create and introduce new-new policies from
time to time and he/she also needs to monitor those policies so that, they should be modified
if required depending upon the present conditions (Kyith, 2011). At present the HG Metals
are supplying its products in various countries across the world through their representatives.
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More than two thousand products are being delivered from the manufacturing plant of the
company to the distributors of the company working in the country as well as outside the
country and then those products are being delivered to the retailers and to the customers. The
company can easily attract more and more customers towards it by providing services related
to the products and by accepting customer returns against some valid reasons. Therefore, we
can say that the order cycle is the measurement of the time interval taken by the system for
the production of the products to the delivery of that product to the customer and they are as
mentioned below.
 Production cycle time – In this phase of the order cycle, production of the products is
being done and monitored by the management at several intervals.
 Order processing – This phase of the order cycle describes about the overall time
invested in processing the products.
 Cash-to-cash cycle time – In this phase of the order cycle, the financial investment or
we can say the cash flow between the supplier and the customer is being carried out
(PLS Logistics, 2015).
Inventory management
In this part of the report, we will discuss about the inventory management of the company. In
actual, the inventory management is the process of controlling the flow of the products
through various phases like production, cost, the value of the goods, etc. It is the process in
which the actual record or we can also say that in which accurate records are being
maintained by the management of the company about the finished goods, which are ready for
the shipment across the different countries of the world (NextInsight Pte Ltd, 2017). The
company holds a strong position in the markets of the various countries, which is possible
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only due to the strong procurement network. With the help of trained and well defined staff
the company has covered a huge geographical area. The management of the company keeps
on modifying the economic policies reactive to the price of the similar products present in the
market (Spacey, 2016). With the help of latest technology the management can easily prepare
general notes, buyer notes, vendor notes, etc., which are beneficial for accessing the history
of the products manufactured. By introducing and effectively utilizing the latest technology
machines we can easily track all the transactions, physical counts, etc. The two main tasks for
the successful accomplishment of the inventory management are tag control and the
replenishment process. Some of the phases can easily improve the overall working of the
system, which are as mentioned below.
 By maintaining all the records related to the history of the products sale and
purchase.
 By using the tag control module effectively for the inventory management (Ming,
2010).
 Ability to trace any object or the product completely such as, tracing the previous
transactions, physical adjustments, etc.
All this can be easily attained by providing time to time training to the employees so that,
each and every employee of the company participates in each and every activity of the
company.
Conclusion
Logistics manager plays an important role in the manufacturing company. Depending upon
the guidelines of the logistics manager the management of the company can directly
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influence its business growth. Making an effective use of the technology directly influences
the various factors like money, time, efforts, etc., invested in the production and the delivery
of the products. The company needs to take timely survey’s for the cross verification of the
quality of the raw materials being purchased by the company and the equality of the products
being delivered to the customers. An effective logistical technique helps in avoiding the loss
of the money, shortage of the material required for the production process, which also
influences the time and cost invested in that product. Proper planning is required for the
implementing the various processes related to the internal and external system of the
logistics. Collecting reviews from the employees as well as from the customers help in
maintaining the quality of the products, which raises the faith of the employees and the
customers of the company. Therefore, we can say that all these processes will surely increase
the growth of the company’s business.
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References
Kyith. (2011, May). HG Metal Quick Take: How to kill a steel stockist. Retrieved from
http://investmentmoats.com/stock-market-commentary/value-investing/hg-metal-
quick-take-how-to-kill-a-steel-stockist/
Ming, Y. (2010). Annual Report 2010: HG Metal manufacturing limited. Retrieved from
http://hgmetal.listedcompany.com/misc/ar2010.pdf
NextInsight Pte Ltd. (2017). HG METAL: Gets open letter from Quarz Capital. Retrieved
from https://www.nextinsight.net/story-archive-mainmenu-60/939-2017/11533-hg-
metal-gets-open-letter-from-quarz-capital
Oracle. (2015). Defining and Maintaining Order Cycles. Retrieved from
https://docs.oracle.com/cd/A60725_05/html/comnls/us/oe/defordcy.htm
PLS Logistics. (2015, August 19). Reduce Cycle Time, Improve Efficiency. Retrieved from
http://info.plslogistics.com/blog/reduce-cycle-time-improve-efficiency
Sin, G. (2014). Resolution passed at annual general meeting. Retrieved from
http://hgmetal.listedcompany.com/newsroom/20140423_173916_526_LLZUWLPIP
XJ8OC53.1.pdf
Spacey, J. (2016, June 27). 12 Key Metrics For Supply Chain Management. Retrieved from
https://business.simplicable.com/business/new/12-key-metrics-for-supply-chain-
management
Team, HG Metal. (2017). Company Profile: HG Metal Manufacturing Limited. Retrieved
from www.hgmetal.com: http://www.hgmetal.com/company-profile/
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Team, R. (2016). HG Metal Manufacturing and subscribers have mutually agreed to
terminate share subscription agreement. Retrieved from
http://in.reuters.com/finance/stocks/HGMM.SI/key-developments/article/3437215
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