Gujarat Ambuja Cement Ltd.

(GACL)
Logistics Case Study

Professor: Mr. Abhijit Nag

Program: MBA (Exe) Sem II
Course: Supply Chain Management
Assignment No. : 1

Jaspreet Khalsa – Roll Number - 41411

Pushkar Pradhan – Roll Number - 41418
Nilesh Hardikar – Roll Number - 41416
Vaibhav Aras – Roll Number - 41431
Introduction & Case Briefing
GACL Introduction

 Ambuja Cements Limited (formerly Gujarat Ambuja Cement Limited) is 3rd largest Indian
cement manufacturing organization.

 It was established by Mr. Narotam Satyanarayan Sekhsaria & Mr. Suresh Kumar Neotia in
1983.

 Manufacturing and distributing cement across India since the last 3 decades and more.

 Expanded its production capacity from 0.7 million tonnes to 29.65 million tonnes.

 Transformed from a single unit to pan-India company.

 Won various awards for management excellence, quality, and environmental

management.
GACL Case Briefing
 Manufacturing and logistics activities of Gujarat Ambuja Cement Limited (GACL).

 GACL has become the cost leader in the cement industry.

 Integrated IT tools/solutions with various its logistic activities.

 GACL adopted innovative and unconventional ways for:

 Productivity improvement
 Cross Functional Approach
 Packaging
 Transportation
 Route & Scheduling
 Outstanding distribution channel
 Finally, looking for growth & new business development.
Salient Features of GACL’s Logistics System
Salient Features of GACL’s Logistic System
UNIQUENESS OF CAGL’S IDEAL PRACTICES TO ACHIVE COMPETITIVE ADVANTAGE -
 Cost leadership via operational excellence

 Speed of the delivery and availability

 Customer centric & smooth channel service

 Dissected activities - Distribution, procurement, movement, material handling

 Focused on making Ambuja a brand. Spent as much as THRICE on marketing

 Cross Functional Team approach

Salient Features of GACL’s Logistic System
 Modern approach on Integrated Logistics System

 Fusion of Information Technology with Logistics.

 Considered holistic view of the Logistics functions

 Smooth for of the Information flow via Value chain

Salient Features of GACL’s Logistic System

 Order Processing - Smooth flow of information. Fully computerised MRP and EDE.
Transmission of Customer Order --> Paper processing --> Retrieval from Warehouse -->
packaging --> Dispatch to transporter -->Adjustment of inventory level --> Transmission of
Info to Dept of Production Planning.

 Inventory Management – Linked it with other functions – Production planning, Raw Material
Planning, Ordering etc. Managers more aware, Online Ordering. Sufficient buffer, round
the clock production with reduced costs via efficient inbound material supply.

 Packaging - First Cement company to use “Polypropylene” for packaging for protection.
Follows international norms. Color codes of packaging as per type of cement.

 Transportation – Availability to the Customer. First Cement company to use ships for
cement transportation. Also taken Advantage of Multi Modal Transportation System –
MMTS. Water transport has reduced the cost. Did setup ports, captive backwater bought
jetties, 5 ships, 8 vessels, 350 Trucks to improve the Transportation.
Salient Features of GACL’s Logistic System
 Warehousing - Dumps and Transhipment point storages. Warehouses are connected
online to marketing offices & production units. Set u p chain of Retailers. Large distribution
network of 11500 outlets. Selective stockiest and dealers (based on reputation, financial
discipline).

 Inventory Management – Linked it with other functions – Production planning, Raw

Material Planning, Ordering etc. Managers more aware, Online Ordering. Sufficient buffer,
round the clock production with reduced costs via efficient inbound material supply.

Supply Chain Management System at GACL

Strength & Weakness of GACL’s Logistics System
Strength of GACL’s Logistic System
 Always follow customer centric approach hence implemented IT with logistics

 Creative (for e.g. packing in paper bags) and risk taker (e.g. own terminals &
become 1st in India to adopted transportation by ships) attitude.

 Lowest cost cement producer in Indian market due to its operational excellence.

 Outstanding distributor network (11500 outlets); It has helped the company to

withstand intense competition.

 Consistent in their brand formation as since 3 decades GACL has same tagline “Iss
cement mein jaan hai”.
Weakness of GACL’s Logistic System
 GACL has no product image hence spend thrice (in 90s) compare to their
competitor to build Ambuja brand.

 Primarily depend on Indian market for revenue generation.

 GACL focus mainly on cement & concrete. It does not have diversified product
range. This reduces its potential to expand its market share.

 Purely depend on retailer market , unlike many competitors who capture wholesaler
market as well
Recommendations
 Recommendations :
What Got you Here Won’t Get You There
Use of New Technologies like IoT/ Artificial intelligence
 Continue improving existing logistics Supply chain even further :

 Automatic Order Processing Based on inventory levels for inbound logistics

 Packaging optimization: Use bulk supply wherever possible. Design packaging based on freight charges

 Transport efficiency :
o Uptime : Connected devices installed on conveyor belts and trucks to predict maintenance.
o Data Monitoring : GPS and RFID on vehicles. Monitor time for loading/unloading, driving pattern etc.
o Mechanization : Effective and faster loading/unloading

 Better forecasting : Use of Big data analytics

 Freight Audits : Clarity on where the majority of spend went ( What you can Measure you can improve !! )

 Mobile App usage : Dealers enter stock levels/requirements  to replenish the stock - automatic ordering
at outbound logistics as well.

 Growth Strategies :

 New Market penetration : Set-up plant in South India & Build long-term strategy to enter global markets

 Focus on wholesale market like government contracts & real state organizations

 Diversification : Build long term strategy to to expand existing product range by using logistics as
competitive advantage
Appendix
GACL Physical Footprints
Brand Architecture
Key Highlights
References

 https://www.slideshare.net/jyoraji/ambuja-cement-case-study
 https://www.slideshare.net/LokendraSinghRathore7/gujarat-ambuja-
cement-limited-operations-management