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Acknowledgement
We express our heartfelt gratitude towards our Course Director, Shri. Rakesh Rajpurohit
(PIM) and Shri Rajnish Kumar, (PIT)for his valuable guidance, support and inspiration
throughout this endeavour. It was due to his supervision that the work on the project was
enjoyable, rewarding and above all successful.
We are also thankful to all the officers from IOFS specially Sri Shashi Pal (AWM IOFS) and
MSIL and specially Sri Tarun Dheer (MSIL Engineer )who gave us data and information
related to their organisations and helped us in understanding their systems.
We also express our heartfelt gratitude towards Sri P S Shammi (RDSO) , Sri Kanaujiya
(Sr.DMM LKO), Sri Agrawal (Dy CMM NCR), Sri Santosh Kumar (Dy CMM COER) for
their valuable guidance..
We also extend our gratitude towards National Academy of Indian Railways,
Vadodara and its faculty members without whom this project would have been a distant
reality.
National Academy of Indian Railways,
Vadodara, Gujarat June, 2016
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Abstract
Supplier relationship management is a comprehensive approach to managing an enterprise's
interactions with the organizations that supply the goods and services it uses. The goal of supplier
relationship management (SRM) is to streamline and make more effective the processes between an
enterprise and its suppliers.
In this project we have studied the SRM activities of IOFS and MSIL and implemented them
for the working environment of railways .Our work plan was divided into following activities
1. Collection of graphical, tabulated material from theory
2. Collection of data from different organisations
3. Visits of IOFS, RDSO, MSIL and different divisions and HQ
4. Study of existing system in following areas
Vendor registration
Vendor rating
Vendor relations
Vendor development
Indigenization
Localization
SRM
Handling Rejection Cases
5. Modify/ design new model suitable for the Indian Railways
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Chapter 1
Literature Review
Introduction
Indian Railways procure about 12,500 stock and 8,000 non-stock items worth
Rs.30,000 Crores every year for smooth running of Railways which is a substantial amount.
Besides, there involves substantial in-house cost in various activities involved in processing
for procurement of materials through tenders and making them available at consumer’s point.
There are lot many number of vendors involved in the procurements. The Indian Railways is
is one of the most important customer groups for many suppliers and service providers. This
is due to the size of the organisation and the volume of public expenditure. It is of great
importance for the Indian Railways to maintain a healthy relationship with its vendors to
ensure supply of good quality material within the prescribed timeframe.
Maintaining positive relationships with suppliers is increasingly being recognised as
a critical factor in sustaining a competitive advantage (Stevenson 2009:525). Most businesses
view their suppliers as partners; in other words, they seek a stable relationship with
comparatively few suppliers that are able to provide high-quality supplies, sustain delivery
schedules and remain flexible in relation to changes in specifications and delivery
schedules.According to Monczka et al. (2010:109), most buyers and sellers recognise the
need for teamwork between buyers and suppliers as the best way to reduce costs and ensure
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quality, delivery, time and other measures of performance. The relationship is two-sided, as
both parties have the power to shape their nature and future direction. Mutual commitment
and balanced power are key features. Commitment enables both parties to keep the
relationship working overtime and balance ensures mutual benefits. This teamwork is often
described as SRM.
However, the public sector has an inherent problem with SRM, as it often sees a
negative correlation between building relationships with suppliers and maintaining ethics.
This is based on a perception that in order for public procurement officials to form
relationships with suppliers, a compromise must be made in relation to their ethics. However,
the importance of sound supplier relationships is vital and relationships with suppliers should
be viewed as a key strategic activity in the public procurement sector.
An alliance between two parties is much like a relationship, & if only one party is
happy, then the marriage is not likely to last .Same scenario is in case of Vendors and
Organization. The Supplier Relation Management process aligns, provides structures, and
manages the supplier relationships. It is important to achieving win-win competitive
performance for the buyer and supplier. It involves “a mutual commitment over an extended
time to work together to the mutual benefit of both parties, sharing relevant information and
the risks and rewards of the relationship. It helps in planning resources and directs, confirms
and adjusts the relationship between company and key suppliers. It Develops the network
bonds of trust, commitment, cooperation & dependence.
The main goal of SRM is to maintain a good relationship with vendors. As per
purchaser's perspective the goal is to maximize the profit as well as reduce the risks involved.
If we are having good relationship with suppliers this will reduce the difference between
capability and performance. This will help in creating a reliable and long term source of
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supply. There is sharing of Information between organisation and supplier thus Organisation
can inform the supplier about their needs and Supplier works in close coordination with the
organization. This helps in reducing overhead costs as well as lead time is also reduced. We
have to maintain a less stock as buffer stock.
If we see from the perspective of a supplier if he has a good relation with organisation
It will be a source of revenue for him. He will have a long term relationship with the
organisation. Also in SRM process as the organisation and supplier works together for the
organisation thus gives them clear idea about the trends of organisation and they can plan
their activities accordingly and supplier grows in line with the organisation
But the process of SRM is not as simple as it looks. The organisation has to face many
challenge. Selection of supplier is one of the challenge. Organisation has to choose one
supplier which will be helpful in highest value addition to the them with least effort i.e.
supplier stratification. Organisation will have to fix of needs and will have to identify the key
values of organisation. Also they will have to fix the performance levels and tolerance. The
SRM process involves System and process integration. Capability assessment is the very
important process in SRM. A careful and accurate assessment of the vendor capability is
must. The organisation and vendor invest jointly in new capabilities to improve the
organisation. Organisation should organise the training of its own staff as well as staff of
vendor. Collaboration with different organisations are made.
There are some agreements between the organisation and vendor which are structured
for srm.They agree upon various Incentive schemes for good performance and penalty for
poor performance. Well defined expected performance level and tolerance ranges are
communicated to the supplier well in advance. Also policies are formed for dealing the cases
of underperformance, its consequence and remedial process
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Maruti & Toyota are famed for its tightly knit group of suppliers and its long-term,
collaborative approach to supplier relation. It operates a system of shared values and work
philosophy across a tightly knit supplier network, an approach that has been adopted by many
other organisations, with varying degrees of success.
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Chapter 2
Current practices in Indian Railway
Bulk of the procurement, spares and capital goods is being done by Indian
Railways from approved suppliers which are either approved by RDSO, DLW, CLW,
ICF or RCF etc. The list is prepared by these nodal agencies are used for making
purchases by stores department of various Railways and Production Units. But it is
surprise to note that during vendor approval, purchase officers have not been made a
part of the process. This is being done solely by technical officers who are not in true
sense the Supply Chain Managers. Also there have not been so many things related to
suppliers relation management in the past in Indian Railways. At present Indian
Railways is not using any proper vendor rating method to select the supplier. Also
there are not so many activities like vendor audit. At present there is a need of looking
into this area so that profit can be maximized as well as the risk is minimum. Thus
increasing the efficiency of stores department as well as relationship with supplier is
better.
1. V endor Registration Process
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Registration Process was made online since 1st Dec 2010. RDSO website has a
vendor Interface on its website which can be accessed very easily by vendors.
Following are the steps of the process of registration.
1. Register online
2. Submit fee
3.Uploading all relevant documents
4.Legar Scrutiny by Legal Cell
5.Technical Screening
6. Acceptance/Rejection
7. Visit to firm's premise for STR(Schedule of Technical Requirements)
verification
8.Capability Assessment Report
9.Sample testing
10. Approval by Directorate head
Flowchart Showing Vendor Registration Process in IR.
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First part-II registration should be given normally, but in some cases developmental
order are also placed first. After assuring adherence to QAP, and satisfactory
performance of the product in field and after supplying the minimum specified
quantity part II status is given. Then after capacity/ capability/ quality audit, firm is
given Part I status. For the quality audit, compliance to STR, QAP etc is verified.
Exhibitions are made once in two years . Last exhibition was made in December
2014. RDSO also participates in National and International exhibition programs for
interaction with vendors.
2. Inspection and Handling Rejection Case: At present items are inspected by
RDSO or RITES or Railway Advisor (for imported items) or by consignee. In case
the quality of material is not as per the desired specifications, the material is rejected
and a rejection memo is prepared. The firm is asked to lift the material. In case of
warranty rejection or rejection of pre-inspected item, board has issued a guideline
vide circular no. 2000/RS(G)/379/2 dt 07-08-2015.
3. Indigenization: Major items of import are rolling stock involving new technology
not available in India and their spares, machines/equipments not available
indigenously and items of regular consumption where indigenous sources are not able
to meet the requirement of Railway either in quantity or quality. Import is resorted to
in inescapable circumstances only. At present, railways is doing so many efforts
towards indigenizing various items.
4. IT Implementation: Implementation of information technology is going on in
Indian Railways. All the information about materials can be seen online Vendor
Registration Process is Online. DLW is doing online prototype inspection. Vendor
Interface is there on RDSO website where vendors can get information regarding
registration and status. There is no centralized Vendor Portal and Vendor Directory.
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Chapter 2
Study of current practices in various organisations in field
1. Indian Ordinance Factory
Vendor Registration and Vendor Rating:
Before the year 2005, since, all the quality control was centralized in the DGQA, therefore,
Vendor registration was also done by the DGQA. However, post-2005, registration activity
was delegated to respective factories.
Registration Procedure:
(i). Vendor Enrolment: Those vendors that are interested in participating in an open tender
have to purchase a Format application and enrolment digital key (INR 2000/-), which is
essential for enrolment.
Subsequent to this enrolment, an Initial Approval Requisition will appear on the screen of
concerned MMG officer (JAG level) which has to be approved online.
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(ii). Capacity Verification: Once the initial online approval is granted by the MMG officer,
enrolled vendor is required to online update the relevant documents like Vendor Registration
Certificate (if registered in any other Ordnance Factory for the same or equivalent item), Past
5 IT Returns, Service & Sales Tax Certificate, Central Excise Certificate, ISO Certificate,
Industrial License, Turnover and Balance sheets for 5 years, etc. along with the submission of
Vendor Registration Request (VRR) fee in the form of Demand Draft (INR 1000/-)
A vendor can participate and bid in an Open Tender as soon as it gets enrolled in the
online system
However, the vendor will be eligible for commercial bid only after final registration
and success in technical bidding
A vendor already registered in another factory for the same or equivalent item need
not to be verified physically again, and is eligible for commercial bidding directly
after submission of essential documents as mentioned above.
Vendor registration/Technical bidding is valid only in case of mode of Open
Tendering and No vendor that is already registered with the factory can participate by
this mode.
(iii) Vendor Rating:
There is a system established in the factory available with all the concerned parties
like Store Section, MMG section, Quality Section etc. that can feed the data in
respective heads
A vendor is rated based on various parameters like delivery schedule is as per the
contract, quality of material & no./lot of item rejected from the delivered lot, failure
of delivery cases, etc.
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This data is fed into the centralized system, which compiles the data entered by
different parties and make calculations as per the set formula
Based on this data vendor rating is generated in terms of %age
Vendor Rating %age is also a criteria to select vendors during Limited Tender Mode
of purchase.
Following are the defined parameters for Vendor Rating
(a). Quality Rating:
VRQ = (Q1 + 0.7 X Q2 + 0.3 X Q3 + Q4) / Q
Where, Q1 = Qty. accepted conforming to specs,
Q2 = Qty. accepted with deviation,
Q3 = Qty. accepted after rectification,
Q4 = Qty. rejected and
Q = Total Qty offered for inspection (Q1 + Q2 + Q3 + Q4)
(b). Delivery Rating:
VRD = (Qa/Qc) + (Qb/Qc) X (Tc/Ta) X 0.5
Where, Qa = Qty supplied on time
Qb = Qty supplied late beyond delivery period
Qc = Qty ordered
Ta = Total time taken to complete the supplies, including late deliveries in number of days
Tc = Delivery Period as per supply order in days
(c). Price Rating:
VRP = PL / PQ
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Where, PL = Lowest price quoted by any supplier against the tender
PQ = Price quoted by the supplier
(d). Service Rating:
Break-up as per IS12040:2001
Parameter
Maximum Score
Cooperativeness and readiness to help
in emergencies
30
Readiness to replace rejected material 20
Providing support documents in time 10
Promptness in reply 10
Cooperation in delivering and
implementing measures or avoiding
recurrence of defects/complaints
30
TOTAL 100
(iv) Delay/Failure of Delivery:
If any delivery schedule is tempered with by the vendor due to its incapability or any
other reason that does not include Act of God, then firstly the rating of respective
vendor is affected
Before 2005, in most of the cases of failure in delivery were countered by performing
Risk Purchase, however, Risk Purchase method has been now minimized to avoid the
loss of time and money caused due to delayed response from defaulter vendor
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At present scenario, Security Deposit at 10% the value of Tender is mandatory for
purchase of all items and has to be submitted as soon as contract is finalized. Same is
deemed to be forfeited in case of any failure of delivery
In case of any delay of delivery, Liquidated Damage has to be imposed on the vendor
at the rate of 0.5% per week and upto a maximum rate of 10%
(v) Special Points of Counter Measure followed for Delay/failure of delivery in OF:
Old methods like Risk Purchase has been abolished and Security Deposit is imposed
mandatorily on all items irrespective of category
Vendor Rating is highly affected in cases of delay in delivery, thus, increasing
difficulties for the vendor to grab future contracts
Quality Control and Inspection:
There are three categories defined in Ordnance Factories for the purpose of Quality
control and inspection viz.:
1. ‘Self-Certification’ category inspection status is awarded to firms securing more
than 95% vendor rating apart from other requirements mentioned in Schedule Of
Procedure for input material inspection. This categorization is valid for 1 year and has
to be reviewed on expiry of period.
2. For ‘Inspection at Firm Premises’ category inspection status, firm has to secure
more than 85% marks in vendor rating apart from other requirements mentioned in
Schedule Of Procedure for input material inspection.
3. ‘Inspection on Receipt’ category inspection is applicable to the firms securing
70% to 85% marks in vendor rating apart from other requirements mentioned in SOP
for input material inspection.
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Procedure of Quality Check:
Though it is mandatory for all the suppliers to attach all relevant test certificates
issued by labs accredited to NABL, with the delivered material, yet inspection for all
Category 2 & 3 material is done in factory premises
After the generation of MIS, material is handed over to Quality Control department
for sampling and testing of the material
For testing purpose Factory owns Laboratory that is equipped with most of the
facilities required to test majority of items, however, if necessary some of the items
are also sent to Laboratory of adjacent Factories
Parameters subjected to test includes material properties, dimensions and other
features
Based on the test results, decision is mentioned on the MIS sheet for further action
Parameter Sample Size Counter-ActionMaterial Property 1 Unit Whole Lot will be rejected
without any further checkCriticalDimension
1 Unit Whole Lot will be rejected without any further check
Other Dimension Based on Indian Standard of Sample size
Every Unit of Lot will be checked for further use
2. MSIL:
Maruti Suzuki makes 1.5 million Maruti Suzuki family cars every year. That’s
one car every 12 seconds; reason behind the success is its JIT supply chain
management which is one of the best in the country. The backbone of a strong supply
chain is Supplier Relation management.MSIL has a vast vendor base, unlike other
OEMs, that allows to achieve 12 sec cycle time. Maruti suzuki India Ltd. does many
activities for maintaining a better supplier relation management.
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• Vendor Registration : Vendor can register in MSIL as a Tier-2 supplier by sharing
their detail and interest in component development with the company. New vendor
may also call R&D team for an exhibition of their Part production plan with capacity.
R&D team is responsible for calling a Tech. Review before source selection with
Vendor in presence of Supply Chain personnel to discuss MSIL production plan =>
Vendor may discuss respective capacity.If found satisfactory the Vendor may be
registered as Tier-2 source after submission of all necessary legal documents.Only
then the Drawings are issued by MSIL to new Vendor.
• Vendor Rating : Vendor rating of MSIL is incorporated in the SAP based system
available.Parameters of rating are Quality, Cost, Delivery, Development.Based on
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these Q, C, D, D parameters, system will be rating the vendors and compare on a 10
point scale
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• System Process: Negotiation is a major part of source selection in MSIL from initial
stage of registration to source selection. MSIL enters in a long term contract, whose
life is evaluated on the basis of quality of material supplied by vendor. Financial
Support is made available for Investment in Dedicated Toolings as per the MSIL
Tooling Support Policy. And this support is also available directly to Tier2’s through
MSIL.The First Mover gets the advantage of higher volume share in order to get
faster return over the investments. Dedicated Department in Supply Chain Vertical
called as Vendor Development cell that discusses future projects with vendors and
provide support in modification of existing vendors and discovery of new vendors
• Quality : MSIL has a dedicated vertical of Quality Assurance that holds
responsibility of not only the final product but also owns the inhouse labs to test new
components. Supplier Quality Assurance is responsible for all the part quality being
supplied whether by new vendor or existing vendor
• Audits: MSIL does Frequent Quality checks on the vendor premises. Source selection
audits are done. It evaluates technical and financial capabilities of vendor. 3rd party
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safety audits of vendor premises are also performed.Supply chain managers are also
involved in these processes. HR Audits of vendors are also performed and MSIL
share the good practices with the HR Teams of the vendors. Also they do the audit of
vendors of their Tier 1 vendor to ensure better quality.
They organise vendor conference frequently in which they discuss the
future projects. Also they have system of awarding the vendors for good performance.
Thus the vendors remain motivated and aware of future developments.
A Vendor's Perspective
Whenever some vendor does business with some organisation, his main aim is
to maximize his profit. He wants simplified process of vendor registration payments
etc. Also if some dispute arises there should be a simplified process for the redressal.
In the present scenario, railway is not giving much attention towards its vendors from
the aspect of maintaining a good relationship. Which is highly discouraging for the
emerging sources.
New entrepreneurs are not willing to do business with the railways. The
processes are a bit complicated and lengthy. Also most of the items are railways
specific and they cannot be used anywhere else. So if a supplier doesn't get the offer
again, his whole setup is idle which can lead to closure of firm.
There have been no initiatives towards joint investment which is one of the
basic pillar of the supplier relation management. Also suppliers have no information
about the future trends and planning of Indian Railways thus they are not able to plan
their activities accordingly.
Negotiations meetings for scrap and purchase need to be there as a regular practice.
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Chapter 4
Analysis
Based on overall observations of the Indian Railways and other organisations like
IOFS and MSIL, we have tabulated our observations in the following areas in all the
three organisations.
IR IOFS MSIL
Vendor Registration Online, Complex Process
Lengthy & Complex Process
Open Online System
Vendor Rating Grey Area Software Based System
SAP Based System
System & Processes Variation among zones Partially Defined Vendor Friendly
IT In Progress In Progress Fully Implemented
Quality RITES/RDSO Inhouse Labs for each factory
Dedicated Department
Where are we lagging?
• Railway is not giving much attention towards its vendors from the aspect of
maintaining a good relationship
• The processes are a bit complicated and lengthy.
• New entrepreneurs are not willing to do business with the railways
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• No initiatives towards joint investment which is one of the basic pillar of the supplier
relation management.
• Suppliers don’t have much information about the future trends and planning of Indian
Railways thus they are not able to plan their activities accordingly.
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Chapter 5
Conclusions
1. Improved Vendor Rating System: A proper vendor rating system should be used
for rating all the vendors of IR. This rating system must cover all the criteria related to
Quality of Product, Delivery Performance, Price of Item, Service of supplier and
System.
Suppliers can be rated by keeping following criteria for evaluation:
The standard lays down the comparative weightage of various factors based on
criticality of component on quality and delivery consideration. For majority of items
for which vendor list is maintained, the Quality shall be treated as Critical and
delivery as Sub Critical Path . For this classification, the standard lays down
following weight ages:
Quality: 35%
Delivery: 20%
Price: 25%
Service: 20%
Following guidelines can be followed regarding vendor rating
•Vendor evaluation shall not be applicable to purchase orders valued below Rs
10,00,000 but if item is Safety item, this limit can be reduced upto Rs. 5,00,000
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•Firms with rating less than 50 per cent should be taken as unreliable and generally
ignored for placement of purchase order .
•Exception :Administrative interest owing to reasons like inadequate sources, limited
capacity, lower price etc .
•Vendors with less than 30per cent vendor rating can be considered for deletion from
the list of approved suppliers .Also there should be a team of professionals which will
visit the vendors with lower rating and identify their problems and give them
recommendations for improving the performance. If the improvement is seen in next
orders, their ratings should be increased accordingly.
•Overall vendor rating can be decided based on orders placed during the last three
years (not less than 3 )
Reference can be taken from the studies done by Abhay Kumar Singh et.al. IRSS
2012 Batch for the major project Vendor Evaluation and Rating.
2. Long Term Contacts: Untill unless we maintain a long term relationship with
vendors just like the private automobile companies have, we will not be able to assure
the continuous supply and minimize the defaults from the vendors part. Vendors will
be able to manufacture the items more economically and quality will be ensured. Also
the traders will be reduced as OEMs will be interested to participate as a first hand
vendor. Recently the Railway Board has issued a circular regarding the LTCs. But it
is not yet adopted by most of the railways. There is a need to implement this concept
all over the railways. There is also need of selecting the items for which the LTCs will
be beneficial. The contract conditions must be so framed that there is a benefit to the
railways as compared to the normal contracts. Also while entering into LTC, we
should take care that orders are placed on multiple suppliers. Sources on which orders
are not placed are diminished with time. Also some big supplier can quote lower price
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initially so that its competitors are not able to survive the market and at later stage he
can enjoy the monopoly. Thus if sources are less and item is of critical nature, we can
enter into LTC with more than one supplier and quantity can be divided on the basis
of capability and rates.
3. Negotiations: There should be provision of negotiations as a regular process in the
tendering process so that the rates are competitive. Thus we will be able to ensure the
economy. At present we are doing negotiations with L1 only which itself limits the
basic logic of negotiation. There should be some discretion as per the scale of the
officer dealing with case so that economy can be ensured and competition can be
increased among vendors. This will help in breaking the cartels also. Also reverse
auctioning must be encouraged and used more frequently with some modifications.
4.Financial incentives to New Vendors: If we give financial incentives to the new
and emerging vendors after proper scrutiny, more number of interested parties will
come and participate . There will be contract between railways and supplier and there
can be so that the vendor will be assured a minimum quantity in future if he
successfully develops the product and maintains the quality standards.
5. Vendor Development For this purpose, railways must organise vendor meets at
all the levels i.e. at Headquarters, workshops divisions etc. There should be some
agenda of each vendor meet and technical persons must be assigned the task of
clearing the doubts of new vendors. Also vendors must be familiarized with various
items of railways by showing them the drawings and explaining the manufacturing
process to them. It will reduce the risk of rejection. Under Prime minister's Make In
India campaign, an special investigation wing must be formed comprising supply
chain managers, user departments and designer of RDSO that will look after all
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import items across all the zonal railways and PUs and will work for search and
development of new vendors for the main aim of indigenization of these items
6. Vendor Interface- The process of vendor registration should be made simple. It
should be made fully online so that vendors can do it by themselves. The status of
their registration should be shown online. All the details of vendor, his performance
related data, vendor rating etc vendor must be made online on his account. Also there
should be a system in which notifications should sent to vendor so that when the
registration is going to expire, they are notified about it. As well as the bill passing
activities must be made online and this should be connected to the vendor account so
that he is able to track the status of his bills. Also we can have option in the same
interface where a vendor can upload the dispatch details and particulars of the
material online and the consignee is notified about the same.
7.Inspection and Handling of Rejection Cases-
Self-Certification status should be awarded to firms with good vendor rating for input
material inspection and should be reviewed on expiry of period. Also there should be
provisions made for inspection at firm's premises.
8. Decentralization cum divisionalisation of Vendor Development: At present ,
some PUs and RDSO is involved in vendor development. This process must be
decentralized . Divisions and zonal headquarters and major depots must be delegated
with the powers for vendor development. There should be a committee at all the
levels which will search for new vendors and familiarize them with the practices of
the Indian Railways and encourage them to do business with Indian Railways by
manufacturing various items.
9. Make in India - Under Prime minister's Make In India campaign, an special
investigation wing must be formed comprising supply chain managers, user
25
departments and designer of RDSO that will look after all import items across all the
zonal railways and PUs and will work for search and development of new vendors for
the main aim of indigenization of these items
The size of India’s public procurement market offers a unique opportunity for its
leveraging for kick-starting the Make in India mantra of the new Government: an idea
most developed countries have been rigorously following for decades
IDDM
Under the new DPP, the government has introduced a newly incorporated
procurement class called “Buy (Indian-IDDM)”, where IDDM stands for Indigenous
Designed Developed and Manufactured.
The category refers to the purchase from an Indian vendor of either products that
have been indigenously designed, developed and manufactured with a minimum of 40
per cent indigenous content or products having 60 per cent of it on a cost basis but not
designed and developed indigenously.
In future, vendors offering equipment designed and built in India(IDDM) products -
will be preferred to vendors offering equipment designed abroad.
Besides being designed and developed in India, at least 40 per cent of a product must
be manufactured in India for it to qualify for the IDDM category.
Under the new DPP,there will be three main categories:-
Make I-the government will fund 90 per cent of the development cost, instead of just
80 per cent. Further, if after successfully developing a prototype, the vendor does not
get an order within 24 months, his 10 per cent expenditure would be refunded.
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Make II-it involves industry funding, rather than government funding, for prototype
development. If a tender is not issued within two years of the successful prototype,the
entire development cost to the duly selected vendor would be refunded.
Make III-it seeks to galvanise innovation in micro, small and medium enterprises
(MSMEs). While procedurally similar to Make II (industry-funded Make), this is
reserved for projects with a development cost of less than Rs 3 crore, which will be
exclusively reserved for MSMEs.
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Chapter 6
Future Scope of Studies
• Identification of ITEMs for which LTC will prove to be beneficial
• Developing a Vendor Interface Module ideal for Railways
• Vendor Development Cell at divisional Level
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References
1. McCue, C. P. and Johnson, B. R. (2010). Strategic Procurement Planning in the
Public Sector. Herndon, VA: NIGP, and the Scottish Public Procurement Toolkit - A
step by step guide to producing a strategic sourcing strategy, August 17, 2010.
2.Effective Supplier Relation Management , Josheph C. Black
3. IS 12040 , 2001 Guidelines for development of supplier rating system
4. Major Project Report " Vendor Rating" by Abhay Kr Singh and group IRSS 2012
batch
5. Supplier relationship management – anathema for theSouth African public
procurement sector by Micheline J. Naud and others.
6. DPP guidelines
29