MATERIALS DEPARTMENT ANNUAL REPORT 2016-2017 · North East from 20th January, 2017 to 21st January,...
Transcript of MATERIALS DEPARTMENT ANNUAL REPORT 2016-2017 · North East from 20th January, 2017 to 21st January,...
MATERIALS DEPARTMENT
ANNUAL REPORT
2016-2017
Materials Management is
associated with the function of
business that is responsible for
the coordination of planning,
purchasing, receiving, storing
and controlling materials in an
optimum manner so as to provide
best possible service to the
customer. The materials used as
inputs such as raw materials,
consumables & spares are
required to be purchased and
made available to the users as &
when needed to ensure
uninterrupted operation.
Therefore, efficient management
of input materials is of
paramount importance for
maximizing productivity, which
ultimately adds to the
profitability of the organization.
In organizations like OIL, the
cost of materials is significant
and hence, better management of
materials will add to Company’s
growth besides ensuring
uninterrupted supply of inputs.
Thus, a well-coordinated
approach towards various issues
involving decision making
becomes an important activity for
any Material Manager.
All the materials related activities
such as material planning,
purchase systems & procedure,
variety reduction through
standardization & rationalization,
reducing uncertainties in demand
& supply, handling &
transportation, inspection, proper
storage & issue of materials to
the various user
departments/other spheres,
inventory management, vendor
management & finally disposal
of obsolete, surplus & scrap
materials etc. come under the
preview of “MATERIAL
MANAGEMENT”
In Oil India Limited (OIL), all
the activities relating to planning
of materials requirement,
indenting, procuring from
competent suppliers, receipt and
accounting, warehousing, issue
of materials to the concerned
departments and Inventory
Management are the
responsibility of Materials
Department.
These activities are carried out
by different sections of Materials
Department duly following
professional ethics, transparent
systems and procedures in order
that right quality of goods and
associated services are procured
at right time in cost effective
manner.
MATERIALS MANAGEMENT
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FROM THE DESK OF DGM- MATERIALS
I take this opportunity to acknowledge the excellent and
outstanding contributions made by each and every one of
Materials Department during the year.
The achievements were possible due to the sincere and
dedicated efforts put in by Team – Materials.
I am immensely grateful to the Corporate Management, Local Management,
ED(C&P) and GM (C& P) for their active support and guidance. I offer my sincere
gratitude to RCE, ED (PS), ED (E&D), and ED (F&A). I also record my
appreciation and sincere thanks to GM (C&P)-Corporate and GM-(KO) for their
continuous support and valuable inputs. I would also like to thankfully acknowledge
the support and co-operation received from various departments.
(U.N. JENA)
DGM - MATERIALS
2 | P a g e
KEY OBJECTIVES & SUB-SECTIONS OF
MATERIALS DEPARTMENT
The main objectives of Materials
Management in OIL are as under:
To arrange for steady flow of materials to
ensure uninterrupted operations.
To procure right quality of materials in
right quantity at the right price from the
right source at the right time.
To reduce blocking of working capital through scientific inventory control.
To preserve/conserve materials kept in stock so that losses due to deterioration/
obsolescence are minimized.
All the requirements (imported as well as
indigenous) of the Company for its operation at
Fields are met by the Materials Department. In
addition, requirement of other spheres are also met
from this office from time to time as and when
required against specific request. The activities of
the Department are carried out by the following
sections:
Planning and Inventory Control
Purchase (Foreign & Indigenous)
Receiving
Depot
Spot Purchase
General Administration
3 | P a g e
HIGHLIGHTS
The total value of purchase orders placed during the year 2016-2017 is Rs. 1,100.63
Crores.
The number of tenders processed from Indigenous Purchase section during 2016-17
has increased by 4% and that of Foreign Purchase section has decreased by 16.9 % in
comparison to 2015-16.
Materials Department has finalized scrap disposal worth Rs. 5.85 Crores during the
year 2016-2017.
Materials Department organized & participated in:
National Level Vendors Development Programme, 2016 was organized by
Materials Dept. on 19.08.2016 at Mumbai.
National Vendor Development Programme at Global SME Business Summit
2016 organized by Confederation of Indian Industry (CII) held during 22nd
to
23rd
November’2016 in Delhi. B2B meetings with the SMEs were held during
the summit.
National Vendor Development Programme organized by Confederation of
Indian Industry (CII) held on 20th
December’2016 in Delhi. B2B meetings
with the SMEs were held during the Meet.
National Vendor Development Programme cum Industrial Exhibition organised
by MSME-DI, Guwahati in association with DIC at K.P. Memorial Hall,
Sivsagar on 22nd
& 23rd
December, 2016.
National Vendor Development Programme cum MSME Expo 2017 organised
by MSME-Development Institute, Guwahati in association with Commissioner
of Industries & Commerce, Government of Assam and Laghu Udyog Bhararti,
North East from 20th
January, 2017 to 21st January, 2017 at Maniram Dewan
Trade Centre, Guwahati, Assam.
National Vendor Development Programme cum MSME Expo 2017 organised
by MSME-Development Institute, Guwahati from 22th
February, 2017 to 23rd
February, 2017 at Bisturam Baruah Hall Premise, Jorhat, Assam.
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KEY FIGURES & ACHIEVEMENTS
PLANNING & INVENTORY CONTROL
INVENTORY
Materials Department issued materials worth Rs.342.10 Crores in
2016-17 as compared to issue of materials of Rs. 357.24 Crores in
2015-16 which is 4.24% lower. The inventory as on 31.03.2017 is
Rs. 322.73 Crores as compared to Rs. 344.92 Crores as on
31.03.2016 (decrease by 6.43%) resulting in very good stock to
issue ratio of 0.94 as compared to 0.96 of previous financial year.
INVENTORY ANALYSIS
CATEGORY NO. OF ITEMS
(2016-17)
CLOSING STOCK
(2016-17)
(Rs. in Crores)
Schedule Items 501 124.87
Review Items 431 62.64
Regular Items 15758 101.24
Insurance Items 185 6.89
RR Items 2262 16.88
NFO Items 6421 10.21
Schedule Items 41%
Review Items 17%
Regular Items 30%
Insurance Items 2%
RR Items 5%
NFO items 3%
System Marker Wise Value of Stock Items
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FINANCIAL YEAR
2014-15 2015-16 2016-17
Stock to Issue Ratio 1.05 0.96 0.94
NUMBER OF STOCK ITEMS
The total number of stock items covered under G.I vocabulary is 25558. Moreover,
during the year 2016-17, total 1979 items have been added to the stock range to
maintain stock of spares etc. for the newly procured equipment as per request of the
operating departments. On the other hand, 434 items have been deleted from the
stock range due to obsolescence.
INVENTORY TURNOVER
Inventory Turnover (stock to issue ratio) is one of the most vital parameters of
performance of Materials Planning. Inventory turnover ratio has significantly
decreased this year from 0.96 to 0.94.
Comparison of the Stock to Issue Ratio for last three years is shown below:
Schedule Items 2% Review Items
2%
Regular Items 59%
Insurance Items 1%
RR Items 9%
NFO Items 27%
System Marker wise Nos. of Stock Items
6 | P a g e
Fast moving items - Items having movement in 2015–16 & 2016-17
Slow moving items -Items having last movement between 01.04.2011 to
31.03.2015
Non-moving items - Items having last movement prior to 01.04.2011.
1.05
0.96
0.94
0.88
0.9
0.92
0.94
0.96
0.98
1
1.02
1.04
1.06
2014-15 2015-16 2016-17
Rat
io
Financial Year
Stock to Issue Ratio
WRITE-OFF 324 items with inventory value of Rs 1.04 Crores have been written-off during
2016-17.
Category No. of items Value (Rs. in Crores)
Fast moving items 9023 235.08
Slow moving items 5275 37.21
Non-moving items 11260 50.44
MOVEMENT WISE INVENTORY
IN 2016-17
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PURCHASE
INDIGENOUS PURCHASE
Indigenous Purchase Section processed 1208
PRs & placed 1233 purchase orders valuing
Rs. 238.27 Crores.
The average lead time of Indigenous Purchase
Section from the date of release of PR to the
date of placement of Purchase Order was 133.48
days as compared to 135.34 days in 2015-2016,
i.e. decrease by 1.40%.
The number of tenders processed during 2016-
17 has increased by 4.00% as compared to
2015-16 from 1251 to 1302 numbers.
FOREIGN PURCHASE
Foreign Purchase Section processed 922 PRs & placed 841 Purchase Orders (on both
Indian and Overseas suppliers) valuing Rs. 863.64 Crores.
The average lead time from the date of release of PR to the date of placement of
Purchase Order was 172.20 days, as compared to 179.58 days in 2015-16, i.e. decrease
by 4.28%.
The number of tenders processed during 2016-17 has decreased by 16.9% as
compared to 2015-16, from 923 to 767 numbers.
During the year 2016-17, some major orders for procurement of items like 2D/3D
Cable Less Seismic Data Acquisition System, Diesel Engine with Acoustic Enclosure,
Truck mounted Coil Tubing Unit, 4” Steel line pipe (seamless) and various casings
were placed from the Foreign Purchase Section.
8 | P a g e
A list of such high value major orders placed during 2016-17 is given below:
Purchase Order No. &
Date
Brief Description
Total Value
(Rs. in Crores)
7951044 dated
15.12.2016
Truck mounted Coil Tubing Unit
(01 Nos.) 31.30
7908190 dated
22.10.2016
Diesel Engine with Acoustic
Enclosure (09 Nos.) 28.47
7118230 dated
25.08.2016
4” Steel Line Pipe, Seamless
(2,48,000 m) 28.30
7118611 dated
12.12.2016
Casing, 9.5/8” x 47 PPF x N-80,
BTC (50,000 m) 22.59
7950984 dated
14.05.2016
2D/3D Cable Less Seismic Data
Acquisition System (01 No.) 21.66
7118299 dated
14.09.2016
4” Steel line pipe, seamless
(70,000 m) 20.88
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The number of incoming consignments (including POL consignments) handled during
the year 2016-17 was 6944 Nos.
The number of Railway rakes received during 2016-17 was 13 as against 09 rakes
received during 2015-16.
A total of 3675 Nos. of Road Permits were issued in 2016-17 against 3264 Nos. in last
year for entry of consignments to Assam from outside the State.
Major Projects of Receiving Section:
1. Renovation of Receiving Section:
The renovation job of Receiving Section was started in mid February’ 2017 and
almost 95% job has been completed.
2. Repairing & Renovation of Railway Tracks.
The repairing & renovation of railway tracks is in progress. Almost 75% job has
been completed.
RECEIVING
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DEPOT
Number of Reservations handled 28329
Number of items issued 53108
Number of items transferred (STOs) 10295
Number of items returned (MRNs) 1057
OFFLOADING OF RAILWAY RAKES
Srl.
No.
PARTICULARS
2015-16
2016-17
REMARKS
1 No. of Railway Rakes
offloaded during the year.
09
13
The demurrage
charges has
increased due to
renovation of
railway lines.
2
Total Demurrage paid
against offloading of the
railway rakes (In Rs.)
2,03,473/-
10,29,703/-
PROJECTS
Srl.
No. PARTICULARS PROJECT HEADS
1
Undergoing
1. Construction of New Chemical Godown for
keeping Barytes & Bentonites.
2 Upcoming
1. Construction of New Chemical Godown
for keeping different Chemicals
2. Installation of new shed at OIL’s Consumer
Pump.
3. Construction of New Shed for scrapped
battery yard.
11 | P a g e
HUMAN RESOURCE
MANPOWER
EXECUTIVES
Sanctioned Existing Shortfall
41 40 1
UNIONIZED EMPLOYEES
Category Sanctioned Existing Shortfall
CP 119 78 41
MP 59 53 6
Steno 6 2 4
Total 184 130 51
SEPARATIONS
Executives Employees
Retirement - 06
TRAINING
Overseas In Country In House
Executive 1 19 04
Work-person Nil 12 92
Manpower of the department as on
31.03.2017 is as under:
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CONSTRAINTS
INFRASTRUCTURE
The present setup of the godowns
and pipe yards of Materials
Department were built during
inception of the Company in the
sixties. Over the years, the
activities of the Company have
increased manifolds.
Therefore, various initiatives have
been undertaken to enhance the
infrastructure facilities and
capacity building to
the desired level to cope up with
the current requirements.
MANPOWER
In view of movement of number of Executives to various Projects / Departments,
Materials Department is facing shortage of executive manpower for sometimes now.
On the other hand, various new requirements have come up in recent times due to
new Government Directives / CVC’s requirement / Audits /IEMs/ SAP
implementation /e- procurement / Lowering of threshold limit for e-tendering/ RTI
queries / implementation of procurement policy for MSEs etc. which has resulted in
enormous workload on the Executives at all levels.
Also Materials Department is facing severe challenges due to acute shortage of
unionized employees. The present strength of Clerical Manpower in the Department
is 78 against the sanctioned strength of 119. Thus, the shortage of the Clerical
Manpower is 41 which is 34.45 % of the sanctioned strength.
13 | P a g e
Sl.
no Details 2014-15 2015-16 2016-17
i
PR (In Nos.):
Stock 351 253 307
Direct Charge (D/C) 560 639 716
e-Tender 49 259 183
Development 37 41 2
Total 997 1192 1208
ii
Tender (In Nos.):
Stock 325 280 293
Direct Charge (D/C) 569 692 795
e-Tender 77 238 212
Development 37 41 2
Total 1008 1251 1302
iii Proposals (In Nos.): 1339 1300 1184
iv Order (In Nos.)
Stock 430 447 335
Direct Charge (D/C) 836 585 723
e-Tender 58 133 166
Development 28 18 2
Total 1352 1183 1226
v Rate Contracts (In Nos.): 25 24 18
vi Total Value of Indigenous Orders [Rs in Crores] :
Stock 59.60 68.36 87.61
Direct Charge (D/C) 50.48 40.44 43.24
e-Tender 67.34 166.47 105.83
Development 4.60 1.85 0.31
Total 182.02 277.12 236.99
vii Average Lead Time (In Days)
From PR Release Date to Purchase Order Date 136.85 135.34 133.48
viii Total No. of CBC Notes put up during the year (In
Nos.):
10 5
0
STATISTICS OF THE DEPARTMENT (SECTION WISE)
INDIGENOUS PURCHASE SECTION
Annexure- I
14 | P a g e
FOREIGN PURCHASE SECTION
Sl.n Details 2014-15 2015-16 2016-17
i) PR (in Nos.)
Stock 610 649 676
Direct Charge (D/C) 265 237 246
Total 875 886 922
ii) Tender (in Nos.)
Stock (Physical Tender) 427 489 441
e-Tender Stock 94 170 116
Direct Charge (D/C) (Physical) 110 107 86
e-Tender Direct Charge (D/C) 108 128 105
Development 2 29 19
Total 740 923 767
iii) Proposals (In Nos.) 790 1018 1112
iv) Orders (In Nos.)
Stock (Physical Tender) 364 313 480
e-Tender Stock 47 103 130
Direct Charge (D/C) (Physical) 107 95 85
e-Tender Direct Charge (D/C) 36 74 133
Development 4 12 13
Total 558 597 841
Value of Foreign Purchase Orders (Rs. In Crores)
v) Stock (Physical Tender) 48.79 49.32 85.17
vi) e-Tender Stock 61.27 283.00 566.84
vii) Direct Charge (D/C) (Physical) 34.64 22.94 17.57
viii) e-Tender Direct Charge (D/C) 289.82 481.46 188.90
ix) Development 1.14 4.43 5.14
x) Total value of Purchases 435.66 841.15 863.64
xi) Average lead time (In Days) from PR release date to
PO placement date
174.95 179.58 172.20
xii) No. of Reverse Auction carried out during the
year(In No.)
2 11 12
xiii) Total no. of CBC Notes raised during the year (in
no)
29 14 3
xiv) No. of presentations made to Independent External
Monitors (IEM)
- 13 1
xv) Total no. of Essentiality Certificates applied for to
obtain Customs Duty Waiver
271 276 230
xvi) Total no. of Project Authority Certificates (PAC) issued
to Indian suppliers to avail Deemed Export Benefit 144 34 126
15 | P a g e
0
200
400
600
800
1000
1200
611.94
1111.99 1100.63 P
U
R
C
H
A
S
E
V
O
L
U
M
E
YEAR
PURCHASE VOLUME
2014-15 2015-16 2016-17
TOTAL PURCHASE VOLUME (Rs. In Crores)
kkkKKKhhhh))gf)cRORESCrores)
2014-15 2015-16 2016-17
a) Value of Orders
placed from
Duliajan on Indian
vendors(Rs. in
Crores)
274.23
670.15
833.04
b) Value of Orders
placed from
Duliajan on Foreign
vendors(Rs. in
Crores)
337.71
448.12
267.59
c) Total value of orders
placed from Duliajan
(Rs. in Crores)
611.94 1,118.27 1,100.63
(Note:-Above excludes values of Spot purchase & Development orders)
Value of Indigenous Orders & Foreign Orders Placed
16 | P a g e
INDIGENIZATION EFFORTS:
Continuous efforts are on to promote indigenization in Oil India Limited.
Accordingly, quite a few numbers of indigenous sources have been developed over
the years through continuous and sustained efforts. In continuation of indigenization
efforts in OIL, a number of developmental orders have been placed during last 3
years.
Year No. of Development POs
(In Nos.)
Value of Development POs
(Rs in Crores)
2014-15 32 5.74
2015-16 30 6.28
2016-17 12 2.30
0
5
10
15
20
25
30
35
2014-15 2015-16 2016-17
No. of Development POs (In Nos.)
No. of Development POs (In Nos.)
32
0
5
10
15
20
25
30
35
2014-15 2015-16 2016-17
No. of Development POs (In Nos.)
No. of Development POs (In Nos.)
32
0
2
4
6
8
2014-15 2015-16 2016-17
Value of Development POs (Rs in Crores)
Value of Development POs (Rs inCrores)
6.28
2.30
30
12
5.74
17 | P a g e
PLANNING AND INVENTORY CONTROL SECTION:
STATISTICS OF PRs (IN NOS.):
Financial Year 2014-15 2015-16 2016-17
PRs on Stock Non-
Stock Stock
Non-
Stock Stock
Non-
Stock
a) Calcutta
339 159 377 107 374 152
b) Foreign
Purchase 454 173 529 101 555 89
c) Indigenous
Purchase 384 962 396 729 391 886
d) Spot Purchase
132 2398 118 2597 79 2493
e) Development
PRs 26 8 35 5 20 7
f) E-Tender 142 238 321 292 286 437
g) Total PRs 5415 5607 5769
CODIFICATION (of Stock items for all spheres):
No. of New Material Codes opened
2014-15 2015-16 2016-17
1000 765 1979
NFO ITEMS:
a) No. of NFO Items as on –
b) Value of NFO Items as on –
(Rs in Crores)
31.03.15 31.03.16 31.03.17
3829
14.07
6536
17.73
6421
10.21
18 | P a g e
GENERAL AND ADMINISTRATION SECTION
DESPATCH SECTION:
(i) No. of documents sent through
Courier Service.
(ii) No. of documents sent through
Registered Post with A/D.
(iii) No. of documents sent through
Speed Post.
2014-15 2015-16 2016-17
6275
9112
955
60
6743
8303
1674
09
15682
PROMOTION:
Sl.
No. Category Total Promotions (In Nos.)
(i) Executive 15
(ii) Work-person 61
OVERTIME (IN HOURS)
Overtime 2014-15 2015-16 2016-17
Overtime
(No. of Hours)
21,611
22,037
16,081
19 | P a g e
RECEIVING SECTION
Sl.no. Particulars 2014-15 2015-16 2016-17
(i) Number of Consignments by road 3490 3286 3675
(ii) Consignments directly delivered by suppliers
(including POL & Safe hand) 3528 4359 3912
(iii) No. of Road Permits processed 3325 3264 3032
(iv) Consignments by Railway rakes 7 9 13
(v) Consignments by Air 36 16 12
(vi) Consignments by Post Parcel 16 11 14
(vii) Consignments by Safe hand 374 287 315
(viii) Consignments by Courier 227 257 197
(ix) MRA/ Delivery Note (103 doc.) raised 3878 3991 7545
(x) GRNs raised 3597 3905 7357
(xi) Discrepancy Reports 397 223 329
(xii) Claims lodged 146 170 146
(xiii) Outward consignments dispatched through
carriers 48 65 44
(xiv) Outward consignments dispatched by
Post/Courier/Air 2 3 2
(xv) No. of Inwards 5887 5704 6183
(xvi) No. of Inwards cleared 5399 4933 5210
(xvii) Balance at the yearend (xv-xvi) 488 771 973
(xviii) No. of POL consignments received from IOC 792 715 761
20 | P a g e
DEPOT SECTION SCRAP DISPOSAL
Srl.
No. PARTICULARS 2015-16 2016-17
1 No. of Lots generated during the year for
disposal of scrap 38 116
2 No. of Scrap Lots sold during the year 23 91
3 No. of Scrap Lots Under Process 15 25
4 No. of e-Auctions hoisted during the year. 18 50
HSD & MS SUPPLY
Srl.
No. PARTICULARS 2015-16 2016-17
1
High Speed Diesel (HSD) & Motor Spirit (MS)
for both at OIL’s Consumer Petrol pump & at
the various Drilling locations.
9720 KLs
11,843 KLs
REVENUE FROM SCRAP DISPOSAL
Srl. No. PARTICULARS 2015-16 2016-17
1
Revenue Earned during the year from
disposal of scrap (Rs. in Crores) 5.29 5.85
A new Double Storied Godown (near Godown No. 05), a new Tyre & Battery
Godown and 07 Nos. New racks for Godown No. 5 (near Electronic Weigh Bridge of
Materials Department) have been constructed for storage of materials.
Achievements:
a) The total no. of scrap lots sold during the year 2016-17 increased by 295%
than the previous year from 23 Nos. to 91 Nos.
b) The total nos. of E-auctions for scrap disposal conducted during the year 2016-
17 increased by 177% than the total nos. of E-auctions conducted during the
previous year from 18 Nos. to 50 Nos.
c) The revenue generated from sale of scrap materials rose by 10% (approx.)
during the year 2016-17 in comparison to the previous year from Rs. 5.29 crore to
Rs. 5.85 crore.
d) The entire scrap disposal process has been incorporated in the SAP system and
thereby abolishing the manual process of disposal of scrap.
21 | P a g e
SPOT PURCHASE
Spot Purchase Details 2014-15 2015-16 2016-17
Total value of SPO (Stock) (Rs. in Lakhs)
11.82 15.34 15.32
Total value of SPO (D/C) (Rs. in Lakhs)
387.51 507.23 546.71
Grand Total (Rs. in Lakhs)
399.33 522.57 562.03
1
10
100
1000
11.82
15.34 15.32
387.51 507.23 546.71
VALUE OF SPOT PURCHASE ORDERS (Rs. in Lakhs)
SPO (Stock)
SPO (D/C)
Total Nos. of PRs received during 2016-17: 2779 Nos.
Total Nos. of POs placed during 2016-17: 3515 Nos.
2014-15 2015-16 2016-17
22 | P a g e
GLIMPSES
VENDORS’ MEET, MUMBAI 2016
VENDORS’ MEET, MUMBAI 2016
VENDORS’ MEET, MUMBAI 2016
VENDORS’ MEET, MUMBAI 2016
*****************************************
VENDORS’ MEET, MUMBAI 2016
C&P INTERACTIVE MEET, DULIAJAN 2016 C&P INTERACTIVE MEET, DULIAJAN 2016