SUPPLY CHAIN MANAGEMENT

self confidence

2011-09-27T18:44:00.001-07:00

The professor stood before his class of 30 senior molecular biology students, about to pass out the final exam.

'I have been privileged to be your instructor this semester, and I know how hard you have all worked to prepare for this test. I also know most of you are off to medical school or grad school next fall,' he said to them. 'I am well aware of how much pressure you are under to keep your GPAs up, and because I know you are all capable of understanding this material, I am prepared to offer an automatic 'B' to anyone who would prefer not to take the final.'

The relief was audible as a number of students jumped up to thank the professor and departed from class.

The professor looked at the handful of students who remained, and offered again, 'Any other takers? This is your last opportunity.' One more student decided to go.
Seven students remained.

The professor closed the door and took attendance. Then he handed out the final exam paper. There were only two sentences typed on the paper.

“Congratulations for your self confidence! All of you who have stayed back and are willing to face the test - have just received an 'A' in this class!”

Moral of the story: self confidence is the key! keep believing in yourself…………….at all times!

Distribution Center

2011-09-02T17:57:00.000-07:00

Pulling Together | Simple Truths

2011-09-02T17:35:00.000-07:00

Pulling Together | Simple Truths

2011-09-02T17:32:00.000-07:00

Beginners Guide to Income Tax with FAQ from taxguru.

2011-08-21T16:46:00.000-07:00

In this Article we are discussing below the frequently asked question by taxpayers on Income Tax related to Taxable Income, General Question, Tax on Income, Return of income, PAN, Salary Income, Income from House property, Income from business and Profession, Capital Gains, Tax Deduction at Source and Assessment which will provide an insight to the laymen on income tax provisions.
A. General
1. What is Income Tax?
It is a tax imposed by the Government of India on any body who earns income in India. This tax is levied on the strength of an Act called Income tax Act which was passed by the Parliament of India.
2. What do you mean by ‘income earned in India’?
Income earned in India is not limited to income earned within the geographical limits or boundaries of the country. Certain incomes are also deemed to have been earned in India although they may have been earned outside the country.
3. Who administers the Income-Tax Act?
The job of monitoring the Income-tax collection by the government is entrusted to a Department called Income-Tax. This department functions under the ‘Department of Revenue, Ministry of Finance, Government of India.
4. What is the period for which a person s income is taken into account for purpose of Income tax?
Income earned in the twelve months contained in the period from 1st April to 31st March (commonly called Financial Year [FY]) is taken into account for purposes of calculating Income Tax. Under the income tax Act this period is called a Previous year .
5. What is an Assessment Year ?
It is the twelve-month period 1st April to 31st March immediately following the previous year [refer answer-4]. In the Assessment year a person files his return for the income earned in the previous year. For example for FY:2006-07 the AY is 2007-08.
6. Who is supposed to pay Income Tax?
Any Individual or group of Individual or artificial bodies who/which have earned income during the previous years are required to pay Income tax on it. The IT Act recognizes the earners of income under seven [7] categories. Each category is called a Status . These are Individuals, Hindu Undivided Family [HUF], Association of Persons [AOP], Body of individuals [BOI], Firms, Companies, Local authority, Artificial juridical person.
When Companies pay taxes under the Income tax Act it is called Corporate tax .
7. Is Income tax Act applicable only to residents?
No, The Income tax Act applies to all persons who earn income in India. Whether they are resident or non-resident.
8. Who is a resident?
If an individual stays in India for 182 days or more in a year, he is treated as resident in that year regardless of his citizenship. If the stay is less than 182 days he is a non-resident.
9. How can I know whether a company is resident or non-resident?
A company is considered as resident if it is incorporated under the Indian Companies Act. A foreign company can also become a resident if the control and management of its affairs is done entirely in India during the previous year.
10. How is resident/ non-resident status relevant for levy of income tax?
In case of resident individuals and companies, their global income is taxable in India. However non-residents have to pay tax only on the income earned in India or from a source/activity in India.
11. I am an Indian scientist, who had gone abroad on a government project. Should my return of income include income earned/received abroad?
It depends on your residential status. If you are a resident all incomes earned globally are taxable. Therefore the same needs to be included in the return. However if any tax is paid on that income in the foreign country, you will get credit for the same.
B. Taxable Income
12. What does the Income Tax Department consider as income?
The word Income has a very broad and inclusive meaning. In case of a salaried person, all that is received from an employer in cash, kind or as a facility is considered as income. For a businessman, his net profits will constitute income. Income may also flow from investments in the form of Interest, Dividend, and Commission etc. Infect the Income Tax Act does not differentiate between legal and illegal income for purpose of taxation. Under the Act, all incomes earned by persons are classified into 5 different heads, such as:
1. Income from Salary
2. Income from House property
3. Income from Business or Profession
4. Income from capital gains
5. Income from other sources
13. Are all receipts considered as income?
No.
Receipts can be classified into two kinds. A) Revenue receipt B) Capital receipt.
The general rule under the Income tax Act is that, all revenue receipt are taxable unless a receipt is specifically exempted and all capital receipts are exempt from taxation unless there is a provision to tax it. Gifts and loans etc are in the nature of capital receipts not attracting tax.
14. What are revenue and capital receipts?
In a simple language, all that one derives from a source is called revenue receipt. For ex. Salary from employment, Rent from property, Interest or Divided from Investments, Profits from business. When an income is earned on account of transacting the source itself, it is called Capital receipt. For ex. Sale of land and building, business, investment etc.
15. Is income tax levied on gifts received by a person?
Gift exceeding Rs 50,000 is taxable unless it is received from
• any person who is a relative or
• on occasion of marriage or
• under will or by inheritance or
• in contemplation of death of the payer
16. I own shares of various Indian companies and receive dividends. Is it taxable?
No. The dividend declared by Indian companies is not taxable in the hands of the share holders because tax on distributed profits have already been borne by the company.
17. I am a religious preacher and earn money from preaching. Do I have to pay tax and file return?
Yes.
18. Can I claim deduction for my personal and household expenditure in calculating my income or profit?
No.
19. Most of my income is given away in charity and I am left with just enough to meet my personal requirement. What will be considered as my income?
What is done after the income is earned does not determine its taxation. However charitable contribution to approved institutions will give you the benefit of certain deductions from taxable income.
20. My daughter stays in USA. She owns a house in India and has let it out. She has asked tenants to pay rent to me so that I can a lead decent life. She has not received any rent. Is she still liable to tax? What if she transfers the house to me?
Your daughter is the owner of the house and therefore she is liable to pay tax even though you receive the rent. If the house is transferred, then you would become the owner and you will have to pay tax on the rental income.
21. My children living abroad send me Rs.20000/- per month for my maintenance. Would this be considered as my income?
No.
22. Is there any limit of income below which I need not pay taxes?
At the moment individual, HUF, AOP, and BOI having income below rupees one lakh need not pay any income tax. For other categories [persons] such as co-operatives societies, firms, companies and local authorities no such exempted limits exists, so they have to pay taxes on their entire income. In cases of senior citizens aged above 65 years and women the exempted limit for the financial year 2007-08 are rupees one lakh ninety thousand and one lakh forty thousand respectively.
23. I am an agriculturist. Is my income taxable?
Your agricultural income is not taxable per se. However, if you have any other source of income like income from investments, property etc, while calculating tax on them, your agricultural income will be taken into account, so that you pay tax at a higher rate on that other income.
24. What is agricultural income?
To consider an activity as agriculture the basic operation such as tilling, sowing, irrigating & harvesting should have been carried out. Thereafter what is sold in the market should be the primary product harvested. Receipt from such sale is considered as agricultural receipt. If however some further processing or modification were done to the harvested product to enhance its marketable value then such enhanced value would be considered as business income.
25. Is income from animal husbandry considered as agricultural income?
No.
26. Do I have to maintain any records or proof of earnings?
For every source of income you have to maintain proof of earning and the records specified under the IT Act. In case, no such records have been laid down, you should maintain reasonable level of records with which you can support the claim of income.
27. As an agriculturist, am I required to maintain any proof of earning and expenditure incurred?
Even if you have only agricultural income you are advised to maintain some proof of your agricultural earnings.
28. I win a lottery or prize money in a competition. Am I required to pay taxes on it?
Yes.
C. Tax on Income
29. How does the Government collect Income Tax?
Taxes are collected by three means: a) voluntary payment by persons into various designated Banks. For example Advance Tax and Self Assessment Tax b) Taxes deducted at source [TDS] on your behalf from the payments receivable by you. c) Taxes collected at source [TCS] on your behalf at the time of spending. It is the constitutional obligation of every person earning income to compute his income and pay taxes correctly.
30. How will I know how much Income tax I have to pay?
The rates of income tax and corporate taxes are available in the Finance bill [commonly called budget] passed by Parliament every year.
31. Does every person have to keenly follow the annual Finance bills?
You need not do so. You can take professional help or the help of Public Relation Officer [PRO] in the local Income Tax Department office. You may also take assistance from Tax Return Preparers [TRP]
32. When do I have to pay the taxes on my income?
Generally the tax on income crystallizes only on completion of the previous year. However for ease of collection and regularity of flow of funds to the Government for its various activities, the Income tax Act has laid down payment of taxes in advance during the year of earning itself. Taxes may also be collected on your behalf during the previous year itself through TDS and TCS. If at the time of filing of return you find that you have some balance tax to be paid after taking into account your advance tax, TDS & TCS, the short fall is to be deposited as Self Assessment Tax .
33. What is the procedure for depositing tax?
A form called Challen available in the Income Tax department, in banks and on the IT department web site should be filled up and deposited in the bank along with the money. Taxes can also be paid on-line.
34. In the challan there are terms like Income tax on companies & Income tax other than companies . What do they mean?
The tax to be paid by the companies on their income is called corporate tax and in the challan it is mentioned as Income tax on Companies . Tax paid by non-corporates is called Income tax and in the challan it is identified as Income tax other than Companies .
35. How is advance tax calculated and paid?
It is paid in installments. The amount payable is to be calculated in the following manner:
Status By 15th June By 15th Sept 15th Dec 15th March
Corporate 15% 45% 75% 100%
Non-Corporate nil 30% 60% 100%
The deposit of advance tax is made through challan by ticking the relevant column.
36. What is regular tax and how is it paid?
Under the Income tax Act every person has the responsibility to correctly compute and pay his due taxes. Where the Department finds that there has been understatement of income and tax due, it takes measures to compute the actual tax amount that ought to have been paid. This demand raised on the person is called Regular Tax . The regular tax has to be paid within 30 days of receipt of the notice of demand.
37. What are the precautions that I should take while filling up the tax payment challan?
Clearly mention:
i. Head of payment eg. Corporation Tax/Income Tax
ii. Amount and mode of payment of tax
iii. Type of payment [Advance tax/Self assessment/Regular/Tax on Dividend]
iv. Assessment year
v. The unique identification number called PAN [Permanent Account Number] allotted by the IT Department. (Since PAN related services have been outsourced, for further details on PAN please see the departmental website http://www.incometaxindia.gov.in/ or www.nsdl_tin.com)
38. Do I need to insist on some proof of payment from the Banker to whom I have submitted the challan?
The filled up taxpayers counter foil will be stamped and returned to you by the bank. Please ensure that the bank stamp contains BSR[Bankers Serial number code] , Challan Identification Number [CIN], and the date of payment.
39. How can I know that the Government has received the amount deposited by me as taxes in the bank?
The NSDL website [http://www.tin-nsdl.com] provides online services called Challan Status Enquiry . You can also see your tax pass book , an online tax credit viewing facility in the same website.
40. What is the procedure to be followed to view my Tax passbook/Tax statement?
You must first register your PAN by logging into the online service called view tax credit in the NSDL website [http://www.tin-nsdl.com]. Thereafter your PAN registration must be authorized by visiting the nearest TIN [Tax Information Network] facilitation center of NSDL or getting their representative to call upon you. These are paid services.
41. What should I do if my tax payment particulars are not found against my name in your website?
For payments deposited by you into the bank you will have to contact your bankers if the credit has not been given even after three days. In case of TDS or TCS you will have to contact the concerned deductor /collector after the due date for filing the quarterly TDS/TCS return by them is over.
42. Is my responsibility under the Income tax Act over once taxes are paid?
No. You are thereafter responsible for ensuring that the tax credits are available in your tax passbook, TDS/TCS certificates are received by you and that full particulars of income and tax payment along with necessary proof is submitted to the income tax department in the form of Return before the due date.
43. What can I do to reduce my tax?
The tax can be reduced by making investment in approved schemes and also by making donations to approved charitable institutions.
D. Return of income
44. What is a return of income?
It is a prescribed form through which the particulars of income earned by a person in a financial year and taxes paid on such income is communicated to the Income tax department after the end of the Financial year. Different forms are prescribed for filing of returns for different Status and Nature of income .
45. From where can I get a return form?
The Public Relation Officer [PRO] can be contacted for this purpose. The form can also be downloaded from the site http://www.incometaxindia.gov.in/.
46. How can I know which form is applicable for my income?
You should choose a return form according to your status and nature of income from the following:
ITR1 For Individuals having Income from Salary/ Pension/ family pension & Interest
ITR2 For Individuals and HUFs not having Income from Business or Profession
ITR3 For Individuals/HUFs being partners in firms and not carrying out business or profession under any proprietorship
ITR4 For individuals & HUFs having income from a proprietary business or profession
ITR5 For firms, AOPs and BOIs
ITR6 For Companies other than companies claiming exemption under section 11
ITR7 For persons including companies required to furnish return under section 139(4A) or section 139(4B) or section 139(4C) or section 139(4D)
ITR8 Return for Fringe Benefits
ITRV Where the data of the Return of Income/Fringe Benefits in Form ITR-1, ITR-2, ITR-3, ITR-4, ITR-5, ITR-6 & ITR-8 transmitted electronically without digital signature
47. What documents are to be enclosed along with the return of income?
The new return form numbering 1 to 8 is annexure less. Hence no documents need to be attached.
48. Where and how am I supposed to file my return?
A return is to be filed before your Assessing officer. It may even be sent by post or filed electronically. Nowadays returns are also being received at designated post offices.
49. Who is an Assessing officer?
He/She is an officer of the Income tax department who has been given jurisdiction over a particular geographical territory or class of persons. You can find out from the PRO or from the Departmental website http://www.incometaxindia.gov.in/ as to your jurisdiction.
50. How is a return filed electronically?
Companies and firms are compulsorily required to file their return electronically, while for others it is still optional. For electronic filing of return you have to log on to the Departmental website http://www.incometaxindia.gov.in/ and upload the information of income and taxes in the prescribed form. If you have digital signature the same can be appended and there would be no need to file a paper return. In case you do not have a digital signature you will be required to file a paper return quoting the provisional acknowledgement number received on completion of uploading.
51. I am going out of India. Who will file my income tax return for this period?
You can authorize any person by way of a Power of Attorney to file your return. A copy of the Power of Attorney should be enclosed with the return.
52. Will I be put to any disadvantage by filing my return?
No. On the contrary by not filing your return in spite of having taxable income, you will be laying yourself open to the penal and prosecution provisions under the Income-tax Act.
53. What are the benefits of filing my return of income?
Filing of return is your constitutional duty and earns for you the dignity of consciously contributing to the development of the nation. This apart, your IT returns validate your credit worthiness before financial institutions and make it possible for you to access many financial benefits such as bank credits etc.
54. Is it necessary to file return of income when I do not have any positive income?
If you have sustained a loss in the financial year, which you propose to carry forward to the subsequent year for adjustment against its positive income, you must make a claim of loss by filing your return before the due date.
55. What are the due dates for filing returns of income/loss?
The due dates are as follows:
Companies & their Directors 3oth September
Other business entities, other than companies, if their accounts are auditable & their working partners 3oth September
In all other case 31st July
56. If I fail to furnish my return within the due date of filing, will I be fined or penalized?
Yes. This may take the form of interest if the return is not filed before the end of the assessment year. If the return is not filed even after the end of the assessment year, penalty may also be levied.
57. Can a return be filed after the due date?
Yes. It may be furnished at any time before the expiry of two years from the end of the financial year in which the income was earned. For example, in case of income earned during FY 2010-01, the belated return can be filed before 31st March 2013.
58. So far I have never paid any tax. If I file a return this year will the IT department ask me about my earlier years income?
It is never too late to start honoring your constitutional obligations for payment of tax. The department may ask you to file return of income for earlier years if it finds that you had taxable income in those years.
59. If I have paid excess tax how and when will it be refunded?
The excess tax can be claimed as refund by filing your income tax return. It will be refunded by issue of cheque or by crediting to your bank account. The department has been making efforts to settle refund claims within four months from the month of filing return.
60. If I have committed any mistake in my original return, am I permitted to file a corrected return?
Yes, provided the original return has been filed before the due date and provided the department has not completed assessment. However it is expected that the mistake in the original return is of a genuine and bona fide nature.
61. How many times can I revise the return?
Theoretically a return can be revised any number of times before the expiry of one year from the end of the assessment year or before assessment by the department is completed; whichever event takes place earlier.
62. Am I required to keep a copy of the return filed as proof and for how long?
Yes. Since legal proceedings under the income tax act can be initiated up to six years prior to the current financial year, you must maintain such documents at least for this period.
63. There are various deductions that have not been reflected in the Form 16 issued by my employer. Can I claim them in my return?
Yes.
64. Why is return filing mandatory even though all my taxes and interests have been paid and there is no refund due to me?
Amounts paid as advance tax and withheld in the form of TDS or collected in the form of TCS will take the character of your tax due only on completion of self-assessment of your income. This self-assessment is intimated to the department by way of filing of return. Only then does the government acquire rights over the prepaid taxes as its own revenue. Filing of return is critical for this process and, hence, has been made mandatory. Failure will attract levy of penalty.
65. Am I liable for any criminal prosecution [arrest/imprisonment etc] if I don t file my income tax return even though my income is taxable?
Non-payment of tax attracts interests, penalty and prosecution. The prosecution can lead to rigorous imprisonment from 6 months to 7 years and fine.
E. PAN
66. What are the benefits of obtaining a Permanent Account Number [PAN] and PAN Card?
A PAN number has been made compulsory for every transaction with the Income Tax department. It is also mandatory for numerous other financial transactions such as opening of bank accounts, availing institutional financial credits, purchase of high-end consumer item, foreign travel, transaction of immovable properties, dealing in securities etc. A PAN card is a valuable means of photo identification accepted by all government and non-government institutions in the country.
67. I have lost my PAN card but remember my number. Do I necessarily need to get a fresh card?
With your PAN you can continue to transact with the Income Tax department. However, in respect of other agencies you may encounter constraints without a PAN card since it doubles as a photo identity card.
68. I have been allotted two PANs. Which number should I use?
You may retain any one of the numbers and surrender the other through a letter addressed to your jurisdictional Assessing Officer.
69. If I do not surrender the additional PAN number, is there any problem?
Yes. It is illegal to have two PANs and the penalty for such offence is Rs.10,000/-
70. By mistake I have been using different PANs for different purpose like one for my demat account and another for filing my Income Tax return and payment of taxes. How do I set this right?
It is advisable to retain only one PAN, preferably the one used for Income Tax purpose and surrender the other number immediately. The institutions where the latter number has been quoted should be informed of the correct PAN.
71. Is it mandatory to file return of income after getting PAN?
No. Return is to be filed only if you have taxable income.
F. Salary Income
72. What is considered as Salary income?
Whatever is received by an employee from an employer in cash, kind or as a facility [perquisite] is considered as Salary.
73. What is meant by an employer-employee relationship?
If a person has the right/power to hire and fire another, then he is an employer of the latter.
74. What are allowances? Are all allowances taxable?
Allowances are fixed amounts, apart from salary, which are paid by an employer for the purpose of meeting some particular requirements of the employee. There are generally three types of allowances for the purpose of income tax- taxable, fully exempted and partially exempted.
75. I am always on tour and my employer gives me substantial daily allowance, most of which is saved. Will this saving be treated as income?
Yes.
76. My employer reimburses all my expenses on grocery and children s education. Would this be considered as income?
Yes. These are in the nature of perquisite.
77. During the year, I had worked with three different employers and none of them deducted any tax from salary paid to me. If all these amounts are clubbed, my income will exceed the minimum exemption limit. Do I have to pay taxes on my own?
Yes. You will have to pay self-assessment tax and file the return.
78. Even if no taxes have been deducted from salary, is there any need for my employer to issue Form-16 to me?
Form-16 is a certificate of TDS and in your case it will not apply. However your employer must issue a salary statement.
79. Is pension income considered as salary?
Yes. However pension received from the United Nation is exempt.
80. Is Family pension considered as salary?
No. It is taxable under other sources .
81. If I am receiving my pension through a bank who will issue Form-16 or pension statement to me- the bank or my former employer?
The bank.
82. Are retirement benefits such as PF and Gratuity taxable?
No. They are exempt subject to conditions and limits laid down in the Income Tax Act.
83. Are arrears of salary taxable?
Yes. However certain benefit of spread over of income to the years to which it relates can be availed for lower incidence of tax. This is called relief u/s 89(1) of Income-tax Act.
84. Can my employer consider relief u/s 89(1) for the purposes of calculating my tax liability?
Yes.
85. My income from let out house property is negative. Can I ask my employer to consider this loss against my salary income while computing my tax liability?
Yes.
86. Is leave encashment taxable as salary?
It is taxable if received while in service. Received as retirement benefit, however it is exempt subject to certain conditions.
87. Life insurance amount received on maturity along with bonus – is it taxable?
No.
G. Income from House property
88. What do you mean by Income from House Property ?
Unlike the other heads of income, Income from house property is a notional income based on a concept called Annual value . This is the value a property is expected to fetch if it is let out. It may be more than the actual rent being received if let out. If it is not let out the expected market/fair rent will be considered as annual value for the purpose of taxation. Property includes the building and the land surrounding it.
89. If a property is not a residential house, can its income still be considered as income from house property?
Yes, provided the property is not used for business purpose.
90. What are the conditions for taxing income from a property under this head?
The person should own the property.
91. Can interest paid on hand loans taken from friends and relatives be claimed as deduction while calculating house property income?
Yes.
92. I have two houses. One is a farmhouse that I visit on weekends and the other is in the city that I use on weekdays. Is it correct to treat both these residences as self occupied?
No. You can claim any one as self occupied. Incomes from buildings situated in or near agricultural farm are considered exempt provided they are used for dwelling of the farm owner/cultivator or for related purposes of storage etc.
93. I own two houses both of which are occupied by my family and me. Is there any tax implication?
Yes. As already mentioned in the answer to Q.No: 87, income from house property is a notional income and only in respect of one residential unit, if self occupied, it will be considered as nil . In case of the other residential unit, marketable rental value will have to be offered for tax.
94. My spouse and I are joint owners of a house constructed by availing housing loan separately. Are we both individually/separately entitled for deduction of the maximum interest payable of Rs.1.5 lakh?
No. The net taxable income from the property must be calculated first and then apportioned between the co-owners. In this process of calculation maximum interest payable of Rs.1.5 lakh can be considered only once.
95. My spouse and I jointly own a house for construction of which both of us have invested equally out of independent sources. Can the rental income received be split between us and taxed in the individual hands?
Yes.
96. I have 5 separate let out properties. Should I calculate the house property income separately for each individual property or by clubbing all the rental receipts in one calculation?
The calculation will have to be made separately for the various properties.
H. Income from business and Profession
97. What does Profession mean?
Profession means exploitation of one s skills and knowledge independently. Profession includes vocation. Some examples are legal, medical, engineering, architecture, accountancy, technical consultancy, interior decoration, artists, writers, etc.
98. I have a large piece of land which I sold by dividing into smaller plots. However I am not in the real estate business. Would this one time activity still be considered as business activity?
Yes. Under the income tax Act even a solitary activity of this nature will be considered as an adventure in the nature of trade and taxed as business income.
99. What books of account have been prescribed to be maintained by a person carrying on business under the Income tax Act?
The Act does not prescribe any specific books of account for business. However you are expected to maintain your accounts in such a fashion that the net profit of the business can reasonably and easily be arrived at by the department. For companies the books of account are prescribed under the Companies Act. Further the Institute of Charted Accountants has prescribed certain accounting standards for business that are required to be audited by them. The Income Tax department accepts the books of account maintained under these standards.
100. Are professionals required to maintain any books of account under the Income tax Act?
Yes. The following books and documents are to be maintained mandatory:
1. Cash book
2. Journal in case of mercantile system of accounting
3. Ledger
4. Carbon copies or counter foils of all bills issued, being serially numbered
5. Original copies of all expenditure bills. Signed vouchers where bills not available for less than Rs.50.
101. I am a small time trader. Do I need to maintain any accounts?
Any business or profession that has an annual turnover/gross receipts exceeding rupees ten lakh and net profit of rupees one lakh twenty thousand, must maintain such books of account and documents from which its income can be reasonably ascertained by the department.
102. Where should the books of account of my business be kept and for how long?
All the books of account and related documents should be kept at the main place of business ie where the business or profession is generally carried on. These should be preserved for a minimum of six years.
103. Do I have to keep an accountant to maintain my account?
This depends upon your ability and need. You may even prefer to use the accounting software available in the market. However, you should remember that in case of turnover exceeding rupees forty lakh per annum in a business and gross receipts exceeding rupees ten lakh per annum in a profession, a professional charted accountant must audit your accounts. [Section 44AB]
104. What is meant by audit of the books of account?
Auditing means checking the correctness and genuineness of your accounts and verifying whether accounting principles and standards have been properly followed in conduct of your business and preparation of accounts. Under Income Tax Act, this verification will have to be carried out by an independent Chartered Accountant.
105. In my business it is impossible to issue bills for every transaction. How can I be expected to maintain proper accounts?
There can be no excuse for not maintaining the bill books. However, if you are a smalltime retail trader with your annual turnover less than Rs.40 lakh, then you are permitted to declare your income on presumption at 5% of your actual sales. [U/s 44AF]. In that event no books of account need be maintained. Similarly, the benefit of non-maintenance of books of account is available for civil contractors [u/s 44AD] in case 8% of the turnover is disclosed as profits. Transporters owning less than 10 goods carriage can also avail the benefit of presumptive income scheme without maintenance of books of account. However, if you declare your income below the minimum level/percentage provided under the scheme, you will necessarily have to maintain the books and get them audited.
106. I am a medical practitioner. Do I need to maintain any accounts?
Yes. All the books and document prescribed for professional [refer question no: 99] need to be maintained. Additionally, a daily case register in prescribed form no.3C and an inventory of drugs, consumables and other stocks also need to be maintained.
107. Can an electric contractor also avail the benefit of deemed income provision?
No. These provisions are specifically for civil contractors.
108. I own 7 cars that are let out on hire to various organizations. Am I also eligible to declare presumptive income without maintaining any books?
No. The scheme is applicable to owners of goods carriages.
109. What are the expenses that I can deduct from my business receipt while calculating the business profit?
Only those revenue expenses that are directly related to the earning of your business receipt can be claimed as business expenditure. Personal expenses are not allowed to be deducted.
110. What do you mean by revenue expenditure?
Revenue expenditures are those that are routine, recurring, and periodical with no enduring value beyond the financial year in which they are incurred. On the contrary capital expenditures are those that are spent on assets from which income is generated. These are normally enduring in nature.
111. In what form can I claim deductions for capital expenses incurred in my business?
The Income tax Act allows you to claim depreciation on your movable tangible and intangible assets. The rates of depreciation are different for different assets.
112. I am engaged in wholesale business and also have a commission agency. My turnover from wholesale business this year is Rs.38 lakh while my commission income is Rs.5 lakh. Do I have to get my accounts audited since the total is exceeding Rs.40 lakh?
Yes, auditing of accounts is compulsory where gross receipt of a person exceeds Rs.40 lakh.
113. I am an Insurance agent. I incur substantial expense on travel and also meet the first few insurance premia of my customers. However I have no documents to prove these expenses. How can I claim them?
If your commission earning is more than rupees sixty thousand a year, then you will have to maintain books of account and proof of expenditure. No claim for the premia payment will be allowed if the customer has claimed the same as his own expenditure.
I. Capital Gains
114. I have sold a house for Rs.5 lakh, which had been purchased by me 5 years ago for Rs.2 lakh. Am I required to pay any tax on the profit of Rs.3 lakh earned by me?
Yes. This profit, which is called capital gain, is taxable subject to certain conditions.
115. Sale of what kind of assets attracts capital gains?
All transfer of capital assets attracts capital gains. Capital assets are those properties that have an enduring value and they are not consumable.
116. What does transfer mean?
Transfer means giving up your right on an asset. It includes sale, exchange, compulsory acquisition under any law, relinquishment etc
117. Does the capital gain tax differ according to my period of holding an asset?
Yes. If assets are held for more than 36 continuous calendar months prior to transfer they are called long-term assets and their transfer results in long-term capital gain that is taxed at the rate of 20%. The only exception to this general rule is in respect of securities for which the period of holding prior to transfer is 12 months to be considered as long-term capital asset and the rate of tax is nil, provided securities transaction tax has been paid. Any transfer of assets held for lesser than these periods would result in short-term capital gain. This is taxed at normal rates in respect of all assets except securities. For securities the rate of tax is 10% along with payment of securities transaction tax.
118. Can I get any benefit for erosion in the value of money over the years while calculating my gain on sale of asset?
Yes. To neutralize the erosion of value of money over the years the cost index for the year of sale is factored in while calculating the cost of investment so that the impact of inflation is neutralized and only the actual gain to the seller is brought to tax.
119. I have sold a property and made profit. If the sale amount is reinvested in purchase of a site, is my profit exempt from tax?
No. For getting exemption the nature of property sold is relevant. If you have sold a residential property, the gain received on sale should be reinvested in another residential property [which may include land and building] to qualify for exemption [section 54]. Even if you have sold a property other than a residential property, you will qualify for exemption only if the net consideration is reinvested in a residential property which may include land and building [section 54F].
120. If I sell my land will I be taxed?
Gain from sale of non-agriculture land is taxable as capital gain. Gain from sale of agriculture land is taxable only if it is located within 8 kilometers from the urban limits.
J. Tax Deduction at Source
121. What is TDS?
TDS means Tax Deducted at Source. It is the amount withheld from payments of various kinds such as salary, contract payment, commission etc. This withheld amount can be adjusted against your tax due.
122. Is TDS relevant for me as a businessman?
Yes. Payments may be made to you after TDS. You can adjust this against your final tax liability. You are also required to effect TDS while making business payments. Failure to do so will result in the entire of expenditure being disallowed as your business expenditure and taxed as income.
123. I have made some deposits with a bank on which annual interest is around Rs.15000. My income is below taxable limit. The banker wants to deduct tax. What do I do?
You can file a self-declaration to the banker in form 15H stating that your income is below taxable limit. The form is available with your banker, the local Income-Tax office and can be downloaded from the website http://www.incometaxindia.gov.in/. This form should be filed before the interests begin to accrue in the fixed deposit account, since the declaration has no retrospective effect.
124. I have let out a property for Rs.20,000 per month. The tenant is deducting tax that is more than my tax liability. What can I do under this circumstance?
If you compute your tax liability and find it to be lower than the tax being deducted, you may approach your assessing officer by filing Form 13. He will issue a certificate directing the tenant to make TDS at a lesser rate. This form is available with the local Income tax office or can be downloaded from the website www.incometaxindia.gov.in.
125. I have deducted tax from payments disbursed but used the same for some urgent financial needs. What are the consequences?
It is an offence to misuse the tax deducted at source. It should have been remitted to government account within the time allowed. The failure attracts tax, interest, penalty and also rigorous imprisonment up to seven years
126. What can I do if I am unable to get the TDS certificate [form-16 or 16A]?
It is the duty of every person deducting tax to issue TDS certificate. In spite of your asking if you are denied the certificate then there is a chance that the tax deducted has not been deposited by the deductor to the government account. Please inform the department [PRO or TDS section] which will then do the needful.
127. I have not received TDS certificate from my employer. Can I claim TDS deducted from my salary?
Yes. The claim can be made in your return. Department however will raise a demand which will not be enforced on you but on your employer.
128. If the employer does not deduct tax and employee also does not pay his due tax, who will be held responsible for tax payment?
The ultimate responsibility to pay tax rests on the person who has earned income. If the employee deposits such tax then the employer will be liable for interest and penalty for failure to deduct tax.
129. I am buying a property from a person residing in USA. Should I deduct tax while making payment?
Yes u/s 195. In case you have any doubt regarding the amount on which TDS is to be made, you may file an application with the officer handling non-resident taxation who will pass an order determining the TDS to be made. Alternatively, if the recipient feels that the TDS is more he may file an application with his Assessing officer for non-deduction.
130. Can I use PAN to pay the TDS deducted into government account?
No. You are required to take a separate Tax Deduction Account Number [TAN] by making an application in form 49B with the Tin facilitation center of NSDL.
131. In case the deductee comes back stating that the original TDS certificate is lost, whether a duplicate certificate can be issued?
Yes. The deductor will have to issue the certificate in a plain paper giving necessary details of deduction and remittance.
L. Assessment
132. What is the mechanism by which the department checks the correctness of my return of income? Would I be given an opportunity to present my views during the course of such verification?
Based on information available with the department a small percentage of returns are picked up for verification. This process is called scrutiny. You will be given full opportunity to put forth views and evidences to support your claims.
133. What recourse is available to me if I am unhappy with the order passed by my Assessing officer?
The Income tax Act has provided for filing appeals in such cases. The first appellate authority is the Commissioner (Appeals). Subsequently the matter can be taken to the Income Tax Appellate Tribunal, then to the High Court and Supreme Court.
134. Some demand has been raised by my Assessing officer after assessment. Can I pay this demand in installments or seek time till my appeal is settled?
Yes. You may approach your Assessing officer within 30 days of receipt of demand notice for installments or stay or seek time for payment. However you are liable to pay interest for delay in payment of demanded tax.

ET Bureau:30 lessons from life and career of NR Narayana Murthy

2011-08-18T21:25:00.000-07:00

NR Narayana Murthy , who steps down as Infosys chairman on August 20, is a role model for not just what he achieved but also how he did it. Here are 30 lessons from Murthy, one for each year he spent at company.

Seize Your Gandhi Moment
Murthy, a self proclaimed socialist in the mid '70s was jailed for 72 hours in Bulgaria. The experience taught him that entrepreneurship and job creation is the way to alleviate poverty.

You might fail, but get started
Learn from mistakes and move on. In 1976, Murthy founded Softronics, a company that lasted a year and a half. When he realised that his first venture wasn't taking off, he moved on.

Think Big. Don't Hesitate to Start Small
In 1981, a determined Murthy started Infosys with Rs 10,000 he borrowed from his wife. In few years, Infosys went on to become one of the largest wealth creators in the country.

Cut Yourself a Slice, Not a Large One Always
When Infosys was set up, Murthy took a pay cut while salaries of other co-founder's were increased by 10 percent. According to Murthy, a leader needs to show his or her sacrifice and commitment.

Lend a Hand and Throw in a Foot Too
After Murthy convinced seven of his colleagues, there was a problem. Nandan's future inlaws were not sure about him. Murthy met Nandan's uncle and convinced him.

Own Up, and Then Clean Up
In the '80s Infosys developed an application for a German client. Murthy noticed a single character error and informed the client immediately.

Trust in God, But Verify with Data
In God we trust, the rest must come with data, is perhaps Murthy's favourite statement. When confronted with difficult decisions, he tends to rely on data.

Keep the Faith
Infosys almost wound up in 1990. Murthy did not want to sell the company. He asked co-founders if they wanted out and offered to buy their shares. All of them stuck together.

Get Involved
Infosys won a contract from Reebok in the early '90s. Seeing the founders involvement, the software, was nick named 'Dinesh, Murthy and Prahlad.' Infy veterans still recall those days.

Sharing is Caring
After the IPO, Infosys decided to share a portion of its equity with employees. This helped them retain talent and gave employees a sense of ownership. Murthy is proud of having given away stocks worth over Rs 50,000 crore to employees.

Treat your People Good, but Your Best Better
Murthy always had a thing for good performers. And he rewarded them well. When Infosys decided to give its employees stock options, Murthy insisted that some shares be given to good performers through the 'Chairman's quota.'

Hire a Good Accountant, Even if he is Argumentative
A young, argumentative Indian, was asking too many questions at an annual general body meeting of Infosys. More impressed than irritated, he hired Mohandas Pai, who went on to help Infosys list on Nasdaq.

When in Doubt, Disclose
Keep your books clean and leave the cooking to the chef. Murthy's philosophy about being open and transparent has given the company a lot of credibility. He often says, "When in doubt, please disclose."

Leave the Family Out
Murthy told his wife that only one of them could be with the company. Murthy, along with other founders, said that none of their children would work for Infosys. This left no room for nepotism at Infosys.

Don't be a Pushover
In 1994, when General Electric wanted to re-negotiate rates, Murthy said no to selling services any cheaper. This helped Infosys not to be overly dependent on any one client.

Make hay While the Sun Shines
In late 90's, India's tech companies made use of the Y2K opportunity to make themselves known in the global market. For Infosys, it was a great opportunity to enter into long-term relationships with their customers.

Brand-aid First, Get Clinical
When the sexual harassment case against Infosys' top sales guy Phaneesh Murthy threatened to tarnish the company's brand, Murthy decided to quickly react. He let go of Phaneesh, and settled the case out of court despite Phaneesh wanting to fight it out.

Mind your Business, you'll See Things Coming
Murthy carries and updates a mental model of Infosys' business all the time. According to him, every leader must have a model, consisting of six to seven parameters that might affect business.

Keep it Simple, Not Silly
Keep your life simple and straight. That way, you get to work more and worry less. Murthy is known to be frugal with money. Despite being one of the richest Indians, he leads a simple life. However, he does not cut corners on buying books or brushing up on literature.

Founders Keepers, but Not Forever
Murthy's decision to not allow founders to continue with the company after the age of 65 set another standard for the company. This way, younger leaders at Infosys had a greater chance at the top positions.

Talent Spotting and Division of Labour
Murthy is known to have an eye for talent and a talent for dividing labour. Nandan was given sales responsibilities while Kris and Shibu did the tech stuff. N S Raghavan was asked to handle people and Dinesh was assigned quality.

Hold on to Your People but don't Cling
Letting go is never easy but its not good to cling on to your colleagues either. Amongst the founders, Ashok Arora, Nandan Nilekani and K Dinesh have quit Infosys. Infy veteran Mohandas Pai has also left Infosys.

Give, it only gets you more
In 2010, the Murthy's donated $ 5.2 million USD to Harvard University Press for a project that aims to make India's classical heritage available for generations to come. He is also supporter of the Akshaya Patra Foundation.

Do it First and Do it Right
Infosys did many things first. And most things right. For example, it was the first Indian company to list on Nasdaq. It was the first Indian company to make it to the Nasdaq 100 list and it was the first Indian company to attain the highest level of quality certification.

Perils of Being a Poster Child
Being the poster child of Indian IT industry, Infosys and Murthy have been at the receiving end of many criticisms. The company has been accused of taking away American jobs and been called a "chop shop."
Get Rich. Honestly
Rich businesses were considered to be dirty in the days when the country had a socialist bent. Infy was a company which got rid of this sentiment. Murthy, with his 'no compromise' policy on greasing palms and doing ethical business, set the standards.

Do Not be Afraid to Court Controversy
Ever since Infosys became a success, Murthy was under constant public glare. This did not deter the straight talking Murthy from courting controversy or voicing his opinions openly.

Invest in Learning
With big investments in training, development and building facilities, India's IT bell-weather has always been keen on grooming the younger generation. Murthy drove the culture of learning in the company in its early days.

Never Lose the Common Touch
The big man of Indian IT kept his personal life simple. He lives in a simple, middle class house and flies economy till date. Murthy has always been accessible to people around him.

Do Good, Look Good
Murthy knew the importance of creating an image for Infosys. He invested in creating a sprawling, world class campuses early on, bigger than any other company's headquarters in the country, that would make his global customers feel like they were in a global office.

beware

2011-08-09T20:42:00.001-07:00

After being married for thirty years.... wife asked her husband to describe her.

He looked at her then said slowly, "You're A, B, C, D, E, F, G, H, I, J, K."

She asks..... "What does that mean?"

He said, "Adorable, Beautiful, Cute, Delightful, Elegant, Fabulous, Gorgeous, Hot."

She smiled happily and said...."Oh, that's so lovely...... What about I, J, K?"

With a deep sigh, he said, "I'm Just Kidding!"

Moral of the story: beware, friends, after the preliminary pleasantries – THE PUNCH – normally comes in the last!

Cost of goods sold (COGS)

2011-07-16T18:46:00.001-07:00

Cost of goods sold (COGS) refers to the inventory costs of those goods a business has sold during a particular period. Costs are associated with particular goods using one of several formulas, including specific identification, first-in first-out (FIFO), or average cost. Costs include all costs of purchase, costs of conversion and other costs incurred in bringing the inventories to their present location and condition. Costs of goods made by the business include material, labor, and allocated overhead. The costs of those goods not yet sold are deferred as costs of inventory until the inventory is sold or written down in value.

What is APQP & PPAP?

2011-07-04T16:55:00.000-07:00

APQP (Advanced Product Quality Planning) and PPAP (Production Part Approval Process) are methods used in
the automotive and some other industries. Their purpose is to ensure that the supplier understands the
customer's requirements and is capable of providing the required quality and quantity of product on time.
APQP sets out a clear path for planning, implementing and verifying a process.
The APQP process has five phases. What phases a company has to complete depends on what they do. There
are checklists provided in the back of the guide published by AIAG that are very helpful in keeping on the right
path. They provide the organization and consistency needed to ensure a successful product and process launch.
If I needed to boil the whole idea down to a few words, it would be "Matching the voice of the supplier's
process to the voice of the customer, VOP = VOC."
PPAP is the hard proof that the supplier understood the customer's requirements. It principally involves
gathering all the data and information that was generated throughout the APQP stage and presenting in
prescribed method and format to the customer for review and, hopefully, approval. The customer reviews the
PPAP submission and renders one of three possible decisions:
1) Product and process approved as submitted
2) Interim approval with a request for additional information or samples
3) Not approved - start over

A 13-Point Procurement Ethics Checklist By Charles Dominick,

2011-06-29T17:11:00.000-07:00

* Do not accept money, goods, services, or favors from suppliers
in exchange for information, decisions in their favor, or,
really, anything else.

* Comply with your employer's policy on accepting gifts, meals,
and entertainment from suppliers.

* If your employer's supplier gift policy allows gifts to be
accepted from foreign suppliers for cultural reasons,
distribute those gifts to others in the organization who are
not involved in decisions affecting the associated suppliers.

* When weighted supplier selection criteria are established
before soliciting bids, do not change the weightings or
criteria after receiving bids unless legitimate, new
information has been discovered.

* Do not "use" prospective suppliers solely to pressure
incumbent suppliers - only request bids from suppliers who
truly have a chance of winning your employer's business.

* Never share a supplier's proposal details with another
supplier unless required by law.

* Never buy or hold the stock of your employer's suppliers.

* If a relative, friend, or yourself owns, manages, or sells
for a supplier, recuse yourself from decisions involving that
supplier and do not access related information unavailable to
competing suppliers.

* Either avoid soliciting charitable donations from suppliers
or ensure that suppliers know that donating or declining to
donate will not impact the opportunity to do business with
your employer.

* If you have a second job, do not use the time or resources of
your primary employer to perform activities related to that
second job.

* If you have a second job, do not use your primary employer's
information to support your second job.

* If you have a second job, do not sell to the suppliers of
your primary employer.

* Actively try to educate other employees - including those
outside of the procurement department - about ethical
supplier interaction.

Creating value

2011-06-26T18:03:00.000-07:00

http://www.youtube.com/watch?v=cTbs9pfQS2M&feature=player_embedded

Some of the good points:

McDonald's is making a bit of a gutsy move to admit that although their jobs really are "just" flipping burgers, they are still solid jobs in a difficult economy.
I'm sure the underlying meaning was to improve the company's reputation, but in doing so they are also supporting and promoting the value of their employees.
You'll notice the defined feedback and training (and train-the-trainer) programs create progression and promotion opportunities.
You may also notice a couple situations where mistakes were made - but the intent was to learn from the mistake to improve the process, not pound on the person.
Note how McDonald's differentiates their training and promotion opportunities from other low wage jobs.

Read more: http://www.evolvingexcellence.com/blog/2011/06/mcdonalds-and-the-value-of-employees.html#ixzz1QQyj7FCT
at Evolving Excellence

Infosys's Narayana Murthy @ 30th and his last AGM as Chairman

2011-06-11T15:02:00.000-07:00

"We have to be firm in pursuing our values; recognise our weaknesses; embrace meritocracy, be open-minded about learning from people better than us, learn from our mistakes and not repeat them; be humble, honest and courteous; be firm in taking quick decisions even though some of them may be unpleasant in the short term, benchmark with the global best in every dimension, and encourage innovation at every level to perform at global levels," Murthy exhorted the new managers and the shareholders.

Business Line : Features / Investment World : A taxing issue for SEZs

2011-05-24T16:20:00.000-07:00

Business Line : Features / Investment World : A taxing issue for SEZs

quote

2011-01-21T00:05:00.001-08:00

"Tact is the art of making a point without making an enemy." - Sir Isaac Newton

Think different......

2011-01-03T22:49:00.001-08:00

A sweet grandmother telephoned St. Joseph 's Hospital.

She timidly asked, "Is it possible to speak to someone who can tell me how a patient is doing?"

The operator said, "I'll be glad to help, dear. What's the name and room number of the patient?"

The grandmother in her weak, tremulous voice said, "Norma Findlay, Room 302."

The operator replied, "Let me put you on hold while I check with the nurse's station for that room."

After a few minutes, the operator returned to the phone and said, "I have good news. Her nurse just told me that Norma is doing well. Her blood pressure is fine; her blood work just came back normal, and her physician, Dr. Cohen, has scheduled her to be discharged tomorrow."

The grandmother said, "Thank you. That's wonderful. I was so worried. God bless you for the good news."

The operator replied, "You're more than welcome. Is Norma your daughter?"

The grandmother said, "No, I'm Norma Findlay in Room 302. No one tells me anything."

Moral of the story: no information is difficult to obtain – if you have the ability to think differently!

Story of Appreciation

2010-11-26T00:46:00.000-08:00

One young academically excellent person went to apply for a managerial position in a big company.

He passed the first interview, the director did the last interview, made
the last decision.

The director discovered from the CV that the youth's academic
achievements were excellent all the way, from the secondary school until the postgraduate research, never had a year when he did not score.

The director asked, "Did you obtain any scholarships in school?" the
youth answered "none".

The director asked, " Was it your father who paid for your school fees?" The youth answered, "My father passed away when I was one year old, it was my mother who paid for my school fees.

The director asked, " Where did your mother work?" The youth answered, "My mother worked as clothes cleaner. The director requested the youth to show his hands. The youth showed a pair of hands that were smooth and perfect.

The director asked, " Have you ever helped your mother wash the clothes
before?" The youth answered, "Never, my mother always wanted me to study and read more books. Furthermore, my mother can wash clothes faster than me.

The director said, "I have a request. When you go back today, go and
clean your mother's hands, and then see me tomorrow morning.*

The youth felt that his chance of landing the job was high. When he went back, he happily requested his mother to let him clean her hands. His
mother felt strange, happy but with mixed feelings, she showed her hands to the kid.

The youth cleaned his mother's hands slowly. His tear fell as he did
that. It was the first time he noticed that his mother's hands were so wrinkled, and there were so many bruises in her hands. Some bruises were so painful that his mother
shivered when they were cleaned with water.

This was the first time the youth realized that it was this pair of hands that washed the clothes everyday to enable him to pay the school fee. The bruises in the mother's hands were the price that the mother had to pay for his
graduation, academic excellence and his future.

After finishing the cleaning of his mother hands, the youth quietly washed all the remaining clothes for his mother.

That night, mother and son talked for a very long time.

Next morning, the youth went to the director's office.

The Director noticed the tears in the youth's eyes, asked: " Can you tell me
what have you done and learned yesterday in your house?"

The youth answered, " I cleaned my mother's hand, and also finished
cleaning all the remaining clothes'

The Director asked, " please tell me your feelings."

The youth said, Number 1, I know now what is appreciation. Without my mother, there would not the successful me today. Number 2, by working together and helping
my mother, only I now realize how difficult and tough it is to get something done. Number 3, I have come to appreciate the importance and value of family relationship.

The director said, " This is what I am looking for to be my manager.
I want to recruit a person who can appreciate the help of others, a person who knows the sufferings of
others to get things done, and a person who would not put money as his only goal in life. You are hired.

Later on, this young person worked very hard, and received the respect of his subordinates. Every employee worked diligently and as a team. The company's performance improved tremendously.

A child, who has been protected and habitually given whatever he wanted, would develop "entitlement mentality" and would always put himself first. He would be ignorant of his parent's efforts. When he starts work, he assumes that every person must listen to him, and when he becomes a manager, he would never know the sufferings of his employees and would always blame others. For this kind of people, who may be good academically, may be successful for a while, but eventually would not feel sense of achievement. He will grumble and be full of hatred and fight for more. If we are this kind of protective parents, are we really showing love or are we destroying the kid instead?*

You can let your kid live in a big house, eat a good meal, learn piano, watch a big screen TV. But when you are cutting grass, please let them experience it. After a meal, let them wash their plates and bowls together with their brothers and sisters. It is not because you do not have money to hire a maid, but it is because you want to love them in a right way. You want them to understand, no matter how rich their parents are, one day their hair will grow gray, same as the mother of that young person. The most important thing is your kid learns how to appreciate the effort and experience the difficulty and learns the ability to work with others to get things done.

What is the Balanced Scorecard?

2010-10-22T03:39:00.000-07:00

What is the Balanced Scorecard?

Need

2010-09-27T23:05:00.000-07:00

A man hated his wife's cat and he decided to get rid of it.

He drove 20 blocks away from home and dropped the cat there. The cat was already walking up the driveway when he approached his home.

The next day, he decided to drop the cat 40 blocks away but the same thing happened.
He kept increasing the number of blocks but the cat kept coming home before him.

At last he decided to drive a few miles away, turn right, then left, past the bridge, then right again and another right and so on until he reached what he thought was a perfect spot and dropped the cat there.
An hour later.... The man calls his wife at home and asked her, "Jen, is the cat there?"

"Yes, why do you ask?" answered the wife.

Frustrated, the man said," Put that damn cat on the phone, I am lost and I need directions to reach home!!!

Moral: however much ever we may dislike some, it is a small world………and we all may need others at some point of time or other!

your vote counts

2010-08-08T23:01:00.000-07:00

It is time to elect a new world leader and only your vote counts. Here are the facts about the three candidates.

Candidate A: Associates with crooked politicians, and consults with astrologers. He's had two mistresses. He also chain smokes and drinks 8 to 10 martinis a day.

Candidate B: He was kicked out of office twice, sleeps until noon, used opium in college and drinks a quart of whiskey every evening. Procrastinates on decisions.

Candidate C: He is a decorated war hero. He's a vegetarian, doesn't smoke, drinks an Occasional beer and never cheated on his wife.

Which of these candidates would be your choice?

Candidate A is Franklin D. Roosevelt. President of America in the World War II

Candidate B is Winston Churchill. Prime Minister of Great Britain in the World War II

Candidate C is Adolph Hitler. The Premier of Germany in the World War II

moral of the story: all that glitters is not gold…………..and all that is dull is not rotten!

Help is not a help always.

2010-07-11T22:29:00.000-07:00

A biology teacher was teaching his students how a caterpillar turns into a butterfly. He told the students that in the next couple of hours, the butterfly would struggle to come out of the cocoon. But no one should help the butterfly. Then he left.

The students were waiting and it happened. The butterfly painfully struggled to get out of the cocoon and one of the students took pity on it and decided to help the butterfly out of the cocoon against the advice of his teacher. He broke the cocoon to help the butterfly so it didn't have to struggle anymore. But shortly afterwards the butterfly died, much to the agony of all students.

When the teacher returned, he was told what happened.

On a grim note, he explained, “By helping the butterfly, you have actually killed it, because it is against the law of nature. The struggle to come out of the cocoon actually helps the butterfly to develop and strengthen its wings. You deprived the butterfly of its struggle and the butterfly died. In your desire to help the butterfly, you actually killed her!”

Moral of the story: A smooth sea has never made a skillful mariner. …………………….everything is difficult before it becomes easy.

------

Dear friends,

I am receiving very good short stories from our HR Guru.
Reproducing for our common benefit.

This is a weekly execercise, I will share with you.

Thanks to the people who send me such wonderful tips and thaughts.

Yours,
Vedula Rameswara Sharma

2010-02-24T06:06:00.000-08:00

Presentation

View more presentations from v.r. sharma.

Supply Chain

2010-01-20T01:42:00.000-08:00

The supply chain starts with the extraction of raw materials or origination of raw concepts for services.

Each link in the chain processes the material or the concept or supports processing.

The supply chain extends from the raw material extraction or raw concept through many processes to the sale of the final product, goods or services to the consumer.

Supply chain management increases customer responsiveness at least cost.

A material is trasferred from a vendor to the manufacturer and further to distributors, retailers before reaching the ultimate consumers.

SCM includes management of materials, information and capital flow in a network consisting of vendors, manufacturers, distributors and customers.

2009-12-16T03:38:00.001-08:00

How To Fix A Slow Computer

View more presentations from Aaron Stone.

2009-11-24T06:06:00.000-08:00

Networking Basics

View more documents from Carlo Fonda.

2009-11-22T02:42:00.001-08:00

Mrp

View more presentations from v.r. sharma.

2009-11-22T02:38:00.001-08:00

Contract

View more presentations from v.r. sharma.

2009-11-22T02:34:00.000-08:00

Po For Services

View more presentations from v.r. sharma.

2009-11-22T02:31:00.000-08:00

Service

View more presentations from v.r. sharma.

2009-11-17T01:09:00.000-08:00

HP Supply Chain

View more documents from tung148.

Q n A: Purchase Value in SAP

2009-11-15T06:42:00.000-08:00

Asked by Shivaji Dhumal on 2/16/2009 3:25 AM
Hi dear,
Can you please tell me how to get purchase value for the month for a
particular purchase group.
We have in our Company about 10000 materials for which 3 different groups do
the purchasing.
Each has to work out the saving made during the month on purchases. For
working out the saving
in percentage, one has to work out the cost of purchases during the month,
which is based on
actual receipts of materials.
Thank you,
Dhumal SD

A:
General LIS Analyses (MM-PUR)
Technical name: SAP_MM_PUR_LIS_GENERAL
Tasks
This role covers activities allowing you to analyze purchasing operations within your enterprise.
Possible questions that might be asked include the following: What is the order value placed by a certain purchasing group? Which materials and how much of them have been ordered from a certain vendor? What is the number of PO items for a material group?
Activities in Materials Management
Activity
Transaction

Purchasing group analysis
MCE1

Vendor analysis
MCE3

Material group analysis
MCE5 ...

==============

I will be reproducing some of the questions answered by me on different forums.
Request to go through, Correct where ever necessary, Add, suggest, improve.

Just interact for the benefit of all of us.

Best Regards,
Sharma

2009-10-28T05:04:00.001-07:00

Blanket Purchase Order

View more presentations from v.r. sharma.

2009-10-22T03:17:00.001-07:00

Mr. Presentation

View more documents from Scott Schwertly.

2009-10-22T01:30:00.000-07:00

Valuated Goods Receipt

View more presentations from v.r. sharma.

2009-10-07T06:02:00.000-07:00

Account Assignment Category

View more presentations from v.r. sharma.

2009-10-07T05:56:00.001-07:00

Purchase

View more presentations from v.r. sharma.

Sunrise, from Tiger hill, Darjeeling.

2009-10-01T06:04:00.001-07:00

2009-09-29T23:18:00.001-07:00

Consumable Materials

View more presentations from v.r. sharma.

2009-09-29T03:56:00.001-07:00

Invoice Verifications And Unplanned Delivery Costs

View more presentations from v.r. sharma.

2009-09-28T06:52:00.001-07:00

How To Stay Happy

View more documents from Ascendi.

2009-09-28T05:59:00.000-07:00

Create Purchase Order With Reference In Sap System

View more presentations from v.r. sharma.

2009-09-23T02:24:00.001-07:00

Request For Quotation (Rfq)

View more presentations from v.r. sharma.

2009-09-23T01:36:00.001-07:00

Conditions In Purchasing

View more presentations from v.r. sharma.

2009-09-23T01:34:00.001-07:00

Master Data Records

View more presentations from v.r. sharma.

2009-09-23T01:10:00.001-07:00

Basics Of Procurement Process

View more presentations from v.r. sharma.

2009-09-16T23:38:00.000-07:00

Understanding Sap Screens

View more presentations from v.r. sharma.

2009-09-15T06:54:00.000-07:00

Lepakshi, Andhra Pradesh, India (Near Ananthapur)

2009-09-15T02:26:00.001-07:00

101 Common-Sense Rules for Leaders

2009-09-13T05:50:00.000-07:00

Boost your management skills by getting back to the basics — here are some common sense tips for leading an effective team.

Management is all about connecting with the people on your team. So how do you effectively manage a team? With common knowledge, of course. These are a few back-to-basics rules that will help you develop management skills that really matter.
BODY LANGUAGE
Like it or not, your body speaks volumes, even when you are silent. Here's how to express an attitude that's appropriate for a leader.
1. Stand tall. Keeping your shoulders back and holding yourself up to your full height will give you an air of confidence.
2. Take your hands out of your pockets. Putting your hands in your pockets is often seen as a sign that you have something to hide.
3. Stand with your arms crossed behind your back. This will help you adjust your posture, and it leaves your hands in a position that is open and not intimidating.
4. Make eye contact. Always look directly into the eyes of the people you are speaking with. This shows you're interested and also gives you a sense of confidence.
5. Sit up straight. Even if you're at an 8 a.m.meeting and feeling tired, it's important to sit up straight in your chair. Slouching makes you look disinterested and can give off an unwanted air of laziness.
6. Face the person you're talking to. This shows you are interested and engaged in the conversation.
7. Shake hands firmly. For many, a handshake is a reflection of the person you're shaking hands with. You don't want to come across as unsure or overbearing, so make sure yours is professional and confident.
8. Always smile. Smiles are contagious and will make others feel positive when you're around.
9. Look your best. You don't have to be model perfect every day, but you should dress appropriately and neatly. Clothes can have a big impact on the way you're perceived.
10. Walk confidently. Keep your head up and take even strides.
MEETING DEADLINES
No one will be happy if your team has to rush around at the last minute to complete a project. Follow these tips to make deadlines less stressful for everyone.
11. Only promise what you can realistically deliver. Don't create deadlines that you know you can't meet. By only promising what you know you can do, you'll be able to finish on time.
12. Set clear goals. Once you know what you need to accomplish, it helps to know how and when you want to do it. Put your goals down on paper and make sure everyone on your team gets a copy.
13. Organize a team. Many of your employees will have unique strengths and training that can make them great assets to certain projects. Pick a team that has the right skills to carry out the job.
14. Delegate tasks. Spread work among your employees in a way that doesn't leave anyone overburdened while also allowing the project work smoothly.
15. Create milestones. Creating milestones for you and your team will help you keep track of your progress and also give you a sense of accomplishment as you reach each milestone.
16. Keep communication open. Keeping everyone in touch with the status of the project is key to making sure it's completed on time.
17. Do it right the first time. Planning ahead will help prevent you from delivering a substandard product. Having to redo something for a client costs money, and, more than likely, future business opportunities.
18. Stay organized. Staying organized will help keep you from wasting time chasing down important documents and information.
19. Make sure expectations are clear. Be sure that each member of your team knows what their specific responsibilities are. This will save time and prevent tasks from being overlooked.
20. Create a plan. Compile your goals and milestones into a comprehensive plan for attacking any project you are given. This way, you can make sure you're staying on schedule and that all of your employees will be clear about how and when things should be done.
GETTING ALONG WITH EMPLOYEES
A happy office is a productive one. Everyone will be more cheerful if you follow these simple rules.
21. Don't make your employees come in on days they're normally not scheduled to work or call them while they're on vacation. A surefire way to make employees resent you is to invade their personal time for nonpressing work. Unless you have something that absolutely has to be done, let time away from work stay that way.
22. Don't play favorites. Playing favorites can bias your judgment and impair your leadership abilities. Treat your employees equally.
23. Give credit when it's due. Don't take credit for your employees' ideas or hog their limelight. This action not only fosters resentment but also makes you seem untrustworthy.
24. Don't micromanage. While it's fine to keep up with what your employees are working on, don't constantly look over their shoulders.
25. Never discuss employee matters with their co-workers. This kind of gossip always gets back to the person and will make you look unprofessional.
26. Don't interfere with employees' work. If your employees are getting work done, don't stress about how it gets done. Even if it's not being done they way you'd do it, it's best to let employees use their best judgment.
27. Don't push unreasonable deadlines. You don't want to spend all of your time at the office, and neither do your employees.
28. Keep your promises. Barring some catastrophic event, you should always keep promises you make to employees, especially about pay and benefits.
29. Keep work about work. Don't require employees to run your personal errands. Take care of your own personal business or hire an assistant.
30. Reward hard work. Make sure your employees feel valued for the work that they do. Employees will be more willing to put in extra effort if they know it's noted and appreciated.
31. Provide motivation. Sometimes employees need a morale boost. Provide them with encouragement to get a project rolling.

MANAGE YOURSELF
Being a good manager isn't just about what you can encourage other people to do, it's also about managing your own performance.
32. Be accessible. Don't hole up in your office all day — come out and visit with your employees. Let them know that they can always come to you with problems and concerns.
33. Be open to constructive criticism. It may not always be what you want to hear, but listening to constructive criticism gives you the chance to learn and grow from your mistakes.
34. Accept responsibility. Part of being the boss is accepting responsibility for the mistakes of all that you manage, not just your own.
35. Know there's always room for improvement. No matter how good you think you are, your job can always be done better. Always be willing to learn.
36. Improve your skills. Learning is a lifelong process. You're never too old to take a class or ask a co-worker to help you improve your knowledge.
37. Explain things simply. Don't use big words or technical jargon just to sound smart and impress others. Your employees will understand and perform better if you explain simply and clearly what you need.
38. Instruct rather than order. You may be the boss, but you don't have to be bossy. You'll have more success if your requests are more tactfully delivered.
39. Include your staff in your plans. Don't make your work top secret; let your employees know what's going on and how they are expected to contribute.
40. Know your subordinates' jobs. You don't want to be caught with inferior job knowledge.
41. Be flexible. It's fine to be firm in what you expect, but allow for flexibility in how it gets done.
42. Get regular feedback. Your employees and superiors can give you valuable feedback on how to improve your performance. Use this to your advantage.
43. Know your limitations. You can't be everywhere doing everything all at once. Know the limits of your time and abilities and say no to things you know you can't do.
BOOSTING PRODUCTIVITY
Getting the most out of your day can be difficult with a busy schedule, but you can use these tips to help you maximize your time in order to be better available to employees.
44. Get the most out of meetings. Be organized and prepared for meetings to increase effectiveness and time savings.
45. Focus your energy on things that matter. Don't let trivial tasks take time away from things that are really important.
46. Identify your time-stealers. Everyone has little things that detract their attention and make them lose focus. Figure out what these are and work to eliminate them, if only for a few hours a day.
47. Be punctual. Being on time is a big deal. Never keep people waiting for appointments or meetings if you can help it.
48. Respond to your correspondence within a reasonable amount of time. You don't have to be chained to your inbox, but make sure you respond to emails within a few hours whenever possible.
49. Do only what is necessary. There are times when going above and beyond works, but doing so on a daily basis can derail your progress on more important issues. Get the key things done first, then see if you have time for additional things.
50. Stick to schedules and routines. While they may not be the most exciting things, schedules and routines can help streamline and improve your productivity.
51. Organize and manage your schedule. Use any tools and utilities you have at your disposal to prioritize your day and keep track of what you need to get done.
52. Plan more than you think you can do. While this may sound stressful, it can actually be a great motivator. If you manage to get everything done, you'll enjoy a great sense of achievement.
53. Get to work early on occasion. Sometimes an uninterrupted half hour in an unoccupied office can help you get key things done or allow you to plan your day before there are any distractions to slow you down.
54. Know that sometimes stress is good. While too much of anything, especially stress, can be bad, sometimes a little stress can be the motivation to get you moving, allowing you to get more done.
55. Do your least favorite tasks first. Get your most tedious and least desirable tasks out of the way earlier in the day. After that, everything else will be a breeze.
MANAGING FINANCES AND RESOURCES
Whether you're a business owner or a manager, staying on top of tangible items is vital to success. These tips can help you keep track.
56. Set up a realistic budget. While it's good to be optimistic, don't plan for more spending than you know you can afford. Make sure you plan for emergencies and contingencies as well.
57. Save costs where they matter the most. Don't just pinch pennies for the present. Make sure your savings will pay off in the long run. Compromising on quality might cost you later on in repairs and replacements.
58. Spend only when it's necessary. Don't spend if you don't need to. Every bit you save goes toward your profit.
59. Find alternative sources of finance. Sometimes even successful businesses need a little help. Business loans and investors can help you through leaner times.
60. Stay true to your contracts. Not only will you gain the respect of your clients, you'll also avoid legal battles that can be a serious financial drain.
61. Make sure employees are well compensated. Employees deserve to be rewarded for hard work. Make sure yours are well compensated for their time and they'll be more productive and happier to come to work.
62. Learn to do more with less. Quality is much more important than quantity, so make what you have count.
63. Assign equipment wisely. While it might be nice for every employee to have a PDA, budgets often don't allow for such conveniences. Make sure the employees that need tools the most have access to them.
64. Invest in solid technology. This doesn't always mean the latest technology, but what your office needs to do work effectively.
65. Update when necessary. Using obsolete equipment and programs can really slow you down. Update when it makes sense so you won't get left behind by competitors.
66. Don't be wasteful. Every sheet of paper, paper clip and pen is a cost on your budget. Use materials wisely and don't waste them out of haste or carelessness.
COMMUNICATING WITH CLIENTS
Whether you're a business owner or a manager carrying out a project, one thing is always the same: The client is dominant voice in decision-making. Learn to communicate with them effectively and you'll set a good example for the people you supervise.
67. Remember that the customer is the boss. At the end of the day, your job is to make the customer happy. Act accordingly.
68. Differentiate your products. Don't get lost in a sea of products and services like yours. Make sure you stand out from your competitors.
69. Retain customers as much as you recruit new ones. While you always want to bring in new business, it's very important to maintain relationships with loyal customers.
70. Provide effective channels of communication. Make sure your clients can contact you easily and quickly if they have a problem, concern or question. They can also provide a valuable source of feedback.
71. Maintain customer data. Use this data to make your customers feel special by remembering occasions like birthdays and anniversaries. It's also helpful for keeping track of purchasing preferences.
72. Segment your customers. Not all customers are alike. Divide your customers into groups that allow you to provide attention and services that meet each customer's unique needs.
73. Provide effective after-sales services. Don't let contact fall off after the work is complete. Make sure your client stays happy.
74. Listen attentively. Pay attention to exactly what clients are asking for to help you better meet their needs.
75. Don't be afraid to say you don't know. It's OK not to know the answer to every question. It's better to say you don't know and get back to a customer than to try to bluff your way through a conversation and have to backtrack later.
KEEP UP WITH CHANGE
There is no way to stop the world from changing, so follow these tips to keep up and ahead of the game.
76. Don't fight change. You can't stop markets, trends and technology from changing, so learn to go with the flow.
77. Adopt a predictive managerial style. Don't wait for things to happen to make a move. Anticipate problems and provide contingency plans.
78. Test your contingency plans. Waiting for disaster to strike is a dangerous way to find out if your emergency plans will hold. Test them out from time to time to fine-tune them and make sure they're still relevant.
79. Identify the positives. Even the most negative changes can have positive aspects to them. Being able to identify and maximize them can help make adapting less painful.
80. Be quick to adapt. Learn to adapt to changing situations quickly and be able to change plans on the spur of the moment if the situation requires it.
81. Stay tuned to external factors. Your business is affected in many ways by outside factors. Keep abreast of these so you can anticipate any sudden market changes that would affect how you need to manage.
82. Put in place a Research and Development plan. Encourage innovation and creativity to stay ahead of the demand for newer and better products and services.
83. Keep an eye on the competition. Don't let the competition get the best of you. Keep up-to-date with what they're doing and use it to your advantage in managing your business.
RESOLVING PROBLEMS
Whether problems are internal or external, they can make your management duties a nightmare if you don't handle them correctly. Here's how to stay on top of them.
84. Stand up for employees. If other departments or managers are bearing down hard on your employees, stand up for them.
85. Fix what's broken. Don't waste time placing blame. Take care of fixing the problem before dealing with any possible repercussions.
86. Manage and control your emotions. Don't let anger or frustration affect your problem resolution. If you are emotionally invested in a situation, cool down before discussing it or bring in an outside mediator.
87. Learn when to step in. Some problems might resolve themselves if you just let them be, but you need to be aware of times where you'll need to step in and take control of a situation.
88. Take the blame. If you've made a mistake, fess up. It'll give you more time to work on fixing the problem instead of talking your way out of taking the rap.
89. Get the facts first. Before you pass judgment on a situation, make sure you have the whole story. Listen to employees and refrain from questioning anyone's integrity without first ensuring that you've gathered all the data.
90. Rise above the crisis. Learn to separate yourself from the problem and rise above the fray. You'll be able to think more clearly and make a better decision on how to rectify the issue.
91. Don't ignore problems. A small problem can easily snowball and become something much more difficult to fix.
92. Try to depersonalize problems. Let employees know that the problem isn't with them but with their actions. Don't make it personal.
GO ABOVE AND BEYOND
Managing people isn't just about getting the job done. To truly be a great leader, sometimes you need to go above and beyond what the job calls for.
93. Lead by example. You can talk until you're blue in the face, but the best way to get a point across is to be the model to emulate. Let employees follow your lead.
94. Get your hands dirty. Sometimes you need to show your employees that no one's above doing unattractive tasks.
95. Make a difference to your employees. Don't just be a generic manager — stand out as a leader and role model for your employees.
96. Gain your employees' trust and respect. You'll have a much easier time managing employees when they respect your rules and boundaries and trust your leadership.
97. Be empathetic to personal problems. Whether it should or not, what happens outside of work can have a big affect on the quality of work produced. Be sensitive if employees have personal issues that keep them from concentrating on work.
98. Be unique as a manager. Every position demands something different and you should be proud to be adept at your particular role rather than trying to emulate other managers.
99. Remember that ethics matter above all. Be honest and reliable in all of your business and personal relationships.
100. Be on the lookout for new ideas. You never know where your next great inspiration will come from.
101. Get to know your employees. Learn more than just their names. Get to know your employees' family backgrounds, likes and dislikes. Doing so will make you more personable.

Creative Planning @ Miami Ad School

2009-09-12T04:30:00.001-07:00

Check out this SlideShare Presentation:

Creative Planning @ Miami Ad School

View more documents from theplanninglab.

Azim Premji at the “Shaping Young Minds” interactive workshop

2009-09-09T05:27:00.000-07:00

organised jointly by the All India Management Association and the Bombay Management Association.

The funny thing about life is that you realise the value of something only when it begins to leave you. As my hair turned from black, to salt and pepper and finally salt without the pepper, I have begun to realise the importance of youth. At the same time, I have begun to truly appreciate some of the lessons I have leant along the way. I hope you will find them useful when you plan your career and life.

The first thing I have learnt is that we must always begin with our strengths. From the earliest years of our schooling, everyone focuses on what is wrong with us.

There is an imaginary story of a rabbit. The rabbit was enrolled in a rabbit school. Like all rabbits, it could hop very well but could not swim. At the end of the year, the rabbit got high marks in hopping, but failed in swimming. The parents were concerned. They said, "Forget about hopping. You are good at it anyway. Concentrate on swimming.” They sent the rabbit for tuition’s in swimming. And guess what happened? The rabbit forgot how to hop! As for swimming, have you ever seen a rabbit swim? While it is important for us to know what we are not good at, we must also cherish what is good in us. That is because it is only our strengths that can give us the energy to correct our weaknesses.

The second lesson I have learnt is that a Rupee earned is of far more value than five found. My friend was sharing with me the story of his eight year-old niece. She would always complain about the breakfast. The cook tried everything possible, but the child remained unhappy. Finally, my friend took the child to a supermarket and bought one of those ready-to-cook packets. The child had to cut the packet and pour water in the dish. After that, it took two minutes in the microwave to be ready. The child found the food to be absolutely delicious. The difference was that she had cooked it! In my own life, I have found that nothing gives as much satisfaction as earning our rewards. In fact, what is gifted or inherited follows the old rule of come easy, go easy. I guess we only know the value of what we have if we have struggled to earn it.

The third lesson I have learnt is that no one bats a hundred every time. Life has many challenges. You win some and lose some. You must enjoy winning. But do not let it go to the head. The moment it does, you are already on your way to failure. And if you do encounter failure along the way, treat it as an equally natural phenomenon. Don't beat yourself for it or any one else for that matter! Accept it, look at your own share in the problem, learn from it and move on. The important thing is, when you lose, do not lose the lesson.

The fourth lesson I have learnt is the importance of humility. Sometimes, when you get so much in life, you really start wondering whether you deserve all of it. This brings me to the value of gratitude. We have so much to be grateful for. Our parents, our life partner, our teachers and our seniors have done so much for us that we can never repay them. Many people focus on the shortcomings, because obviously no one can be perfect. But it is important to first acknowledge what we have received. Nothing in life is permanent but, when a relationship ends, rather than becoming bitter, we must learn to savour the memory of the good things while they lasted.

The fifth lesson I learnt is that we must always strive for excellence. One way of achieving excellence is by looking at those better than ourselves. Keep learning what they do differently. Emulate it. But excellence cannot be imposed from the outside. We must also feel the need from within. It must become an obsession. It must involve not only our mind but also our heart and soul. Excellence is not an act but a habit. I remember the inspiring lines of a poem, which say that your reach must always exceed your grasp. That is heaven on earth. Ultimately, your only competition is yourself.

The sixth lesson I have learnt is never give up in the face of adversity. It comes on you suddenly without warning. One can succumb to self-pity, wring your hands in despair or decide to deal with the situation with courage and dignity. Always keep in mind that it is only the test of fire that makes us find steel. A friend of mine shared this incident with me. His eight-year-old daughter was struggling away at a jigsaw puzzle. She kept at it for hours but could not succeed. Finally, it went beyond her bedtime. My friend told her,” Look, why don't you just give up? I don't think you will complete it tonight. Look at it another day.” The daughter looked with a strange look in her yes, "But, dad, why should I give up? All the pieces are there! I have just got to put them together!” If we persevere long enough, we can put any problem into its perspective.

The seventh lesson I have learnt is that while you must be open to change, do not compromise on your values. Mahatma Gandhi often said that you must open the windows of your mind, but you must not be swept off your feet by the breeze. You must define what your core values are and what you stand for. And these values are not so difficult to define. Values like honesty, integrity, consideration and sensitivity have survived for generations. Values are not in the words used to describe them, as much as in the simple acts. A wise man once said, "You do not have to change the world to make a difference. If, on the way to your house, you can bring a smile on the face of a crying child, you have done your bit.” At the end of the day, it is values that define a person more than the achievements. Because it is the means of achievement that decide how long the achievements will sustain. Do not be tempted by short cuts. The short cut can make you lose your way and end up becoming the longest way to the destination.

And the final lesson I learnt is that we must have faith in our own ideas even if everyone tells us that we are wrong. There was once a newspaper vendor who had a rude customer. Every morning, the customer would walk by, refuse to return the greeting, grab the paper off the shelf and throw the money at the vendor. The vendor would pick up the money, smile politely and say, "Thank you, Sir.” One day, the vendor's assistant asked him, "Why are you always so polite with him when he is so rude to you? Why don't you throw the newspaper at him when he comes back tomorrow?” The vendor smiled and replied, "He can't help being rude and I can't help being polite. Why should I let his rude behavior dictate my politeness?"

So it is, my young friends, with all of us. In my youth, I thought of myself as a rebel and was many times, a rebel without a cause. Today, I realise that my rebellion was another kind of conformity. We defied our elders to fall in line with our peers! Ultimately, we must learn to respond instead of reacting. When we respond, we evaluate with a calm mind and do whatever is most appropriate. We are in control of our actions. When we react, we are still doing what the other person wants us to do.

I wish you all the best in your life and career. I hope you achieve success in whatever way you define it and what gives you the maximum happiness in life. Remember, those who win are those who believe they can.

PRACTICAL EXPERIENCE

2009-06-17T01:07:00.000-07:00

I have some queries regarding APICS-CSCP certification...

I am working in a software company in Chennai.... Currently i have 1.9 months experience....I would like to get into supply chain management...
I worked in SCM project for 1 year.... So i know a bit about SCM functionalities.... That project created an interest for SCM....

Am i eligible to appear for APICS-CSCP certification exam???
I saw APICS website that people should have 2 years relevant experience in SCM to be eligible.... Can you please advise me on this???

Is it possible for me to get a job in SCM by doing these certifications alone???

I would like to get into SCM by any cost....Can you pls suggest me some ways to get into SCM???

Your suggestions would be a great help for me and highly appreciated.....

Thanks in advance....

Regards,
Syed.
============
From APICS Site
+++++++++++++++++++++++++++++++
APICS The Association for Operations Management Certification Program
Certified Supply Chain Professional
The APICS CSCP (Certified Supply Chain Professional) is the first globally recognized comprehensive certification program designed for supply chain management professionals. The APICS CSCP designation is the first and only global supply chain credential accepted by the world’s top manufacturers.
By earning the APICS CSCP designation you:
 Validate your ability to create and execute supply chain strategies that meet customer needs and increase profits
 Increase your professional value to employers
The APICS CSCP program addresses the entire supply chain—extending past your internal operations—from your suppliers, through your company, to your end customers.
Is APICS CSCP Right for You? Earning an APICS certification can take you from a qualified candidate to a sought-after expert. Around the world, APICS certification designees are recognized, promoted, hired, and paid more.
Especially in today's growing and changing supply chain management field, to maintain your competitive edge, you must continuously increase your knowledge, skills, and expertise. Stay competitive with the APICS Certified Supply Chain Professional certification.

What is the APICS CSCP?
The APICS CSCP brings your company's entire value chain into perspective. By giving you a truly end-to-end view of the supply chain, you become the expert, not just within your organization's walls—you become the global expert.
From manufacturing to service, in business and consumer markets, the increasingly important role of effective supply chain management affects all organizations. Customer expectations are high—with the APICS CSCP, you can ensure that your company not only meets, but exceeds them.

Who are APICS CSCP Designees?
• Professionals seeking in-depth knowledge and understanding of their entire supply chain.
• Employees hoping to boost productivity and collaboration.
• Innovators promoting global supply chain management.
• Managers working to affect lead time, inventory, productivity, and the bottom line.
• Hard workers trying to move forward in their careers.
++++++++++++++++++++++++++++++++++++++++++++++++++++++
My Answer to your question:

I think you have 1year 9months experience.
One year in SCM project.
A project experience and practical domain experience differs.
Project experience under guidance of a project manager, along with other senior colleagues you worked in more of a comfort Zone.
You know how to create a purchase order in the system in an AC room, but the pain behind identifying the vendor, getting the prices, negotiating the terms, getting approved, placing order, follow-up to get it on time, delivery at the right place, getting inspected, approval, goods receipt note preparation, actual issue, accounting, invoice verification, payment etc has to be experienced in practical.
Knowing concept is one thing, applying it in different situations is altogether it is different.
It is not difficult, but one has to experience to know it better and better it further.
Flight navigation you know, you can work in a simulator your self but when it comes to actual flying ………..
You know what I mean to say.
This is the reason any professional course stipulate some practical experience before taking up the course.
When you worked in a factory in SCM area, you will better appreciate what course is talking about.
You can relate subject to your applicability, you will ask more yourself why like this? Why not like this? Otherwise you accept what it says, you read, get thru the certification.
The actual difference you find when you want to apply.
Your will is what is most important. SCM jobs are very hard, tiresome.
Unless you enjoy what you do it is difficult path. A passion for SCM is required in this profession.
As already you are in the job, please do concentrate more on to SCM projects, get involved, move around the factories, what is happening in your projects and practically in the ship floor, relate why we are doing what we are doing for example a purchase request comes from shop floor, enquiry generated by a purchase executive, cost analysis done by a cost accountant, final order authorized by a GM. It may be completely different in another industry.
According to the need of the factory or project you are in you try and translate in to the system.
Where as if you are person involved in SCM you design and implement the system how a document has to flow, how a purchase has to take place. You advice the project personnel how you would like the software to behave in a given situation, the project person exactly do what you want which is called customization.
Getting into SCM is not difficult. But only SCM job may not pay you as much SCM with Software implementation experience can.
So stick on to the job you are in, try and do this course. If you got admission fine, otherwise better to wait and do after gaining more experience.
Meanwhile I suggest you to see the website of IIMM (Indian Institute of Materials Management).
There are some courses which may interest you, this qualification plus software project experience will definitely place you in better position than only getting in SCM.

PRACTICE MAKES PERFECT

2009-05-27T04:37:00.000-07:00

This is a collection from one of my friend, which I would like to share with you all as there is a perfect message for us.
--------

All record breaks concentrate on the previous performances... that's why
everyone achieves better not the best...

If sky is the limit, then no one is
our competitor...

let me say one incident..

A boy in a mathematics class
fell asleep, at the end of the class when he saw the blackboard, there was a
problem for assignment. Waking guiltily, he copied the sum and went home.. For
the whole night he worked out... worked out and worked out.. He found a
solution..

Next day when he showed this to the master, everyone and the
master of course wondered.. because master has ended the class by saying no
one has found a solution for this puzzle..Hence no one in the class tried.. as
this boy is unaware of this fact, he worked out and found the
solution..Miracle happened...

WEBSITES ON SAP FOR REFERENCE AND HELP

2009-05-12T00:26:00.000-07:00

http://help.sap.com

http://sap.com

http:// sap.com/education

http://sap.com/srm

http://service.sap.com/maintenance

http://service.sap.com/rkt-solman

http://service.sap.com/roadmaps

http://service.sap.com/servicecatalog

http://service.sap.com/solutionmanager

http://service.sap.com/support service

http://service.sap.com/sweat

www.toolbox.com

www.masteringsap.com

www.mySAP.com

www.sap_img.com

www.sap_press.com

www.sapgenie.com

www.sapmm001.htm

www.sapresources.com

www.sapteched.com

www.service.sap.com/supportacademy

SOME MODULES IN SAP

2009-03-16T11:43:00.000-07:00

This insertion is to give a bit of clarity to the people who are interested to know about the modules in SAP. Lot of aspiring people who want to learn SAP, ask which module is better for me, which is more lucrative in the terms of getting in to a job and more payment.

The Answer is simple. The best suited module for you is the experience in which domain you have and where you want to nurture your career.

Each and every module is important in relation to any Enterprise. No one can say that for me only my production, sales and distribution are important and we do not care about plant maintenance or warehouse management.

More fetching may be plant and maintenance as only few people will take up this module at present, availability of trained people in this module are scares at present time. But by the time you come out of the institute trained what is the guarantee that same amount of scarcity prevails. So you can not foresee the demand today. For any bright candidate with proper experience, good understanding on the business process of the enterprise and willing to take that extra mile - employment and earning should not be a problem at all.

So have some at least two to three years of experience, select the module which complement your domain experience and get the skill.

Following are few modules in SAP for your ready reference.

ABAP Advanced Business Application Programmer

APO Advanced Planning Optimization

BW Business Information Warehousing

CRM Customer relationship Management (Mobile sales, Internet sales and interactions)

DW Data Warehousing

EHS Environment, Health and Safety

EP SAP Enterprise Portal

FI CO Finance and Control

HCM Human Capital Management

HR Human Resource Management

MM Material Management

PLM Product Life cycle Management

PM Plant Maintenance

PP Production Planning

PS Project System

SCM Supply Chain Management

SD Sales and Distribution

SEM Strategic Enterprise Management

SRM Supplier Relationship Management

WM Warehouse Management

XI Exchange Infrastructure

Have a nice day.

Intro - SAP

2009-02-21T00:48:00.000-08:00

SAP & MySAP Business Suite.

SAP stands for Systems Application Products in data processing.
It should be pronounced as S A P and not as a single word sap.

SAP product strategy is:

Extend instead of replace.
Business process integration for cost reduction and efficiency.
Cooperation among the supply chain, collaboration within business community for improved effectiveness, value creation.

The evolution of business is from ERP to Inter Enterprise Cooperation, collaborative business. Drives efficiency, profitability from business relationship.

SAP founded by 5 IBM Engineers in 1972 at Waldorf in Germany.

Claus Wellenreuther
Dietmar Hopp
Haus Wenner Hector
Hasso Plattner
Klaus Tschira

SAP Business suit is built on SAP Net Weaver, which include SAP Web application server, the portal infrastructure, the exchange infrastructure and information integration.

SAP Web application server supports Internet technology (HTTP & XML) JAVA and ABAP.

SAP switched over to R/2 Architecture in the year 1979, R/3 Architecture in the year 1992 and supported e-commerce since 1996.

SAP provides 23 industry and cross industry solutions.
28 languages which can be used in SAP.
46 various country specific versions available.
About 10,000 tables used in SAP R/3.
About 2.5 lakhs screens in SAP.
About 53 core modules called business components in SAP.
SAP reached India in year 1997, implementation by SAP partners and not SAP Labs.

SAP solution manager is for implementation, which covers operation, solution monitoring and support.

SAP implementation is a collective effort.

Enterprise success

2009-02-05T03:55:00.000-08:00

Enterprise success depends on how best we manage the materials, how best control the costs, how best we use the information system and integrate all activities effecting the bottom line.

Enterprise resource planning, ERP in short made this task easy.

With sound knowledge of any ERP only one can consider best suited for in the field of Purchasing, Materials Management and Logistics, apart from the domain knowledge.
Reason being every company using ERP, amongst them SAP is one pioneered.

As it is worth to give some inputs to students who want to get in to SAP MM, practicing professionals, who are in for some inputs,
few writings I would like to take up how SAP deals with real time situations.

I request all the experienced to add few lines to my blogs, which will help me to improve and also helpful to the readers.

You may kindly ask if any doubt or question in mind, which I will try to answer in my next blog.

Me believe in learning continous process, I would like to have a interactive experience with you all.

Best wishes.

Business logistics

2009-01-29T03:21:00.000-08:00

In an organization environmental factors influence decision making at all levels and warehouse is no exception. Tax structures and other governmental rules and regulations will influence the movement of goods from supplier to factory and factory to consumer. The basic rules and regulations will remain same but the rates, tariff and materials affect change from year to year.

Customs duties and sales tax account for a major portion of government revenues.

The warehouse in charge must be aware of these in order to function effectively have the economic advantage of stocking and not stocking.

Business logistics management aims at delivering material in production areas and finished goods to ultimate consumer by better freight management.

These activities cover the functions of incoming material, transportation, warehousing, material handling, stock control, order processing, supply scheduling and distribution of finished goods.

An efficient logistics system is one which handles the flows of inputs of raw materials into the production shops and the flow of the finished products to the customer according to plan with benefits greater than cost.

The packaging to be as acceptable for the consumer and easy to handle, transport and distribute, deliver to the customer. Product must be available for buy when customer wants at the merchant location.

Storage automatically assumes importance because of the time lags between completion of manufacturing and packaging, between the packed state and loading in to the carrier and between unloading at the destination and final delivery to the customer. Efficient management requires the time lag to reduce as minimum as possible to keep the distribution channel full and at the same time to minimize the costs. This is what exactly reduction in queuing. Time is money. Distance you cannot reduce, but time to travel can. This will reduce Inventory carrying and associated costs.

A total solution considering all the factors is the need in relation to the following areas:

Space cost economy in warehouses, labor economy in handling, transportation efficiency, reduced working capital investment, accurate forecast and control of costs, marketing efficiency and customer satisfaction.

Incident based documentation is the effective measure for a better functioning of the store.

On time, every time.

Right at fist time, every time and no rework.

No short cuts.

Success of verification process

2009-01-25T03:41:00.000-08:00

The primary purpose of stock verification is to check that the physical stock agrees with the book balance.

If these fail to match, as often is the case the following could be the possible reasons:

Labeling of the item is not correct
Location of the material is wrong
Arrangement of the warehouse is improper
Gangways filled with boxes and other materials
Mislaid or lodged between shelves and dislocated later
Theft
Faulty documentation
Illegible handwriting
Figures copied incorrectly
Loss of documentation
Elimination of number of copies
Deteriorating accuracy of records
Transferring the paper work from one shift to another and not completing properly
Receiving by weight and issuing by numbers or vise versa
Inaccuracy of weighing scales at receiving or issuing or both places
Issuing without authorization, indents, or issue vouchers
Urgent issues made when store closed, without posting the entries.
Delay in inspection, posting the goods receipt note and other receipt documents later than the issue documentation posting.
Using rejected material in emergency and not accounting properly
Improper communication with the user, inspection, external vendors
Each bin containing more than one item leading to mix up and confusion in issue
Issuing wrong material, wrong indenting
Issuing with out a document, as user is busy
Direct delivered items, bulk items are received and removed without adequate documentation
Understaffed stores and presence of unskilled stores personnel
Improper records on the transfer from one store to another, lead to discrepancies
Material receipt when the store closed resulting in delay in postings.

In spite of all the above warehouse in charge has to receive, store in proper locations, issue, and account properly to minimize the discrepancies.

Verification agency should be impartial. Success of the verification process depends on the skill of the personnel involved.

Entire operation is on two primary documents namely receipt and issue. Hence the warehouse in charge has to keep these two records update and accurate to minimize the year-end imbalances.

Physical verification is useful only when a follow-up action is planned for future like writing off, imposing penalties, tightening security etc.

Stock verification

2009-01-24T01:56:00.000-08:00

Stock verification defined as the physical counting, weighing, or measuring the stock materials held and making a record of these figures.
Mostly it is an annual exercise coincides with the closing of accounts.

The warehouse in charge is responsible for the safe custody of the largest current asset of the balance sheet. They are raw materials, machinery spares, finished and semi finished goods.

In order to avoid discrepancy in stocks, constant review of stocks, up to date posting, reconcile the physical and book balances are of prime importance.

The main objective of the verification process is to identify the weaknesses in the operations of the warehousing system.
To ensure the input, output and stock on hand accounted for accurately.
Ensure proper placement of materials.
It also helps to identify slow, non-moving and obsolete items.
The chances of collusion amongst the various staff members may be to detect.
The purpose is to set up records as the basis for control and secondly to pass on accountability from one department to another.

Science there is always a pressure to complete stock verification exercise quickly; this may be ineffective and nullify the advantages.

To overcome this drawback, we require adopting continuous monitoring or perpetual inventory taking. In this case, materials verified throughout the year, a few items daily.

It will be advantageous to have the high value items verified more often.

Arrange verification of the high value items at the time of issue or receipt of these items in order to avoid accumulation of errors.

The primary purpose is to assure that inputs, outputs and the stock on hand have been accounted for accurately. A careful planning, well organized and executed stock verification will give tremendous advantages to the organization.

Take care to avoid double counting and omitting some items.

Cost

2009-01-22T05:02:00.000-08:00

Storage costs

The warehouse in charge must be aware of the fact that materials cost the organization in the form of intrinsic price paid to the supplier, freight, handling expenses, and inspection charges.

Materials stored in the warehouse cost the organization in terms of men, materials, time, space, insurance, risk and so on.

The inventory carrying cost is approximately about 30 per cent per annum on the average value of materials stocked.

Cost of funds

The cost of money invested in inventories and or opportunity cost for the funds.

Cost of storage place

For storing items, a firm needs space. This includes space for documents, work force, and office furniture etc. The cost incurred on the physical storage facilities in the form of rental value or opportunity cost basis.

Salary and wages

The salary and wages and the statutory payments of stores staff, security staff, stores audit staff, depreciation of bins, racks, handling equipment, furniture, office equipment and other devices used in store.

Obsolete items

Low shelf life items stored will deteriorate over period of time, requires to be disposed off.

Losses in spillage, evaporation of volatile substances and chemicals are also included in inventory carrying cost.

Breakages in handling and in transporting within stores premises will add to the costs. The non-moving items require liquidating at throwaway prices.

Losses due to theft and pilferage are included in the inventory carrying cost.

Insurance cost against fire, theft, burglary and other risks.

Over stocking cost - is an extension of inventory carrying cost, it signifies the investment in inventory for a longer period than necessary. Hence, the opportunity of alternative investment is lost.

Stock out or under stocking cost - in the finished goods area non-availability of an item implies that the customer will go to another vendor or substitute the brand with another. This results not only in loss of profit on sales, but also affects the image of the organization. In the case of raw material, stock out results in idle production line, the cost of lost production during the period of stock out and the extra cost per unit which might have to be paid in an emergency purchase.

The warehouse in charge is expected to manage the stores efficiently by reducing these costs without affecting the service level to the consumer.

"A battle well begun is half won"

2009-01-21T01:49:00.000-08:00

Management of receipts in store

"A battle well begun is half won", amply emphasizes the management of receipts or inputs in the warehouse.

Input management in the warehouse includes the following activities.

Requirement determination
Preparing of purchase requisitions
Chasing supplies through the purchase section
Request for expediting suppliers
Receiving the materials
General visual inspection
Quantity inspection
Coordination with quality inspection
Taking stock of the accepted materials
Taking care of rejected materials
Completing documentation
Making book entries
Endorsing supplier’s bills

Unless the warehouse systematizes its working by better planning, it will not be able to complete the input formalities. This is one of the critical areas as the time of deliveries is uncontrollable. Load carrying vehicles, containers from out stations not to consider as extension of warehouses, and to clear on a priority basis to avoid demurrages.

Receipt determination

Past consumption, anticipated forecasts, lead-time, exceptional known cases, are relevant to determine the requirements in the case of regularly consumed items.

Purchase requisitions

By raising a purchase requisition, the procurement section to be informed about the materials requirement, to take necessary purchase actions.

For new items, it is essential to consult the user before releasing the requisition. This will ensure corrected, updated entries and prevents accumulation of obsolete items.

Based on the purchase requisition, purchase department will release the purchase orders. A copy of which is forward to the stores for facilitating receipts. This facilitate the store to prepare for receiving the materials and correlate with the suppliers documents sent with the material. The receiving section constantly should chase, follow-up the procurement section to get the materials in time.

The warehouse is accountable for the physical count of the receipt. The quality control department will carry out the quality assessment. The final incoming materials can be in usable stock only upon passing thru the prescribed quality checks. Technically the procurement action is not complete until the inspection is over.

The warehouse to be provided with adequate measuring instruments like weighing scales, measuring vessels, for volumes, ratio balances for counting etc.

The document used to regularize receipt of materials is the goods receipt and inspection note or GRIN.

When shortage arises, send intimation to supplier giving the necessary details. There is urgency in this regard, as claims are time bound.

Regular materials issue to consumer departments constitutes the bulk of warehouse activity. Warehouse also has to cater to temporary requirements such as equipments, tool kits, projects, sub contracts, sample issues, returnable issues, etc., separate procedure have to be developed for these issues and the method of accounting should be specified and effectively implemented.

Issues must be based on valid authorization. Authorization can be in the form of a material requisition.

Once issue voucher received by the store, it is for the store to check availability, identify the authenticity, correlates the control limits and issue the material. The necessary entries made in the stock ledger / bin card.

Complete the receipt, stocking and issuing formalities as and when the transaction happens.
Incident based documentation will avoid many problems of stock mismatch, timely indication for procurement, excess or short receipts, over stocking etc.

Define procedure for stock transfer or loan from one cost center to another.

FIFO system of issue

To enable a proper rotation of stocks, adopt a first in first out (FIFO) principle in the issue of materials. As the name implies, items received first issued first. The material in store physically organized in such a way that the first in materials are handy enough to be issued out first. This rule will take a back seat when expiry date is the criteria for issue. Material whose expiry date is first to issue first irrespective of it receipt.

Returns to stores

In normal conditions there will be no returns to store once the material is issued, but it may be necessary to have a procedure laid in place as some times because of wrong issue, or plan change, or non suitability of the item issued may give rise to return the material back to store.

A store document is to cancel by issuing another reverse document.

Factors in stores systems

2009-01-15T04:32:00.000-08:00

To satisfy the customer/consumer/user, it is essential for the stores function to systematize its working.

The factors that have to be considered while designing a storage system are the type of material, volume of transaction, physical facilities, receipt, issue, documentation, flow of materials, and the warehousing manual.

Raw material stores

Proper control of raw material is one of the major factors that influence the profitability of a company.

A stock out in the raw material will reflect by an idle manufacturing line.

External factors in the supply such as availability, lead-time, seasonality, staggered deliveries, and credit conditions all combine to influence the stocking of raw material. Transactions of raw materials need tight control to affect an uninterrupted supply to production lines.

Packaging material and consumables

Generally, the consumable and packaging materials do not cause any supply problems, but occasionally some of them can become scares. The general characteristic of these items are voluminous. Depending on the demand and availability of their storage space, the stocking policy controlled. They require protecting from moisture and excess heat, their aesthetic character is most important in view of the marketability.

Machinery spares

Machinery spares pattern of consumption is rather unpredictable. The obsolete inventory in most cases comprises only the spare parts.

A proper coordination, planning, procurement, issue, monitoring, and control can give better results. Regular collection, collation and analysis of consumption data reduce the problem of a stock out.

The damage due to non-availability of a part is several times more than the cost of the part itself; leading to hoarding of machinery spares stock.

A collaborative approach between purchase, stores and engineering departments will save a lot of money in this area.

Finished goods

The input to the stock is as per the production schedule, while the output depends on market conditions in a consumer-oriented industry. A slack market leads to stockpiling and a buoyant market leads to scarcities. Shelf life is an important consideration. Storage space should be adequate to meet these extreme conditions. The system of control should be oriented towards coordination not only within an organization but also with the competition and consumer profile.

Finished goods to be as near to the consumer as possible, in order to reduce transportation time, cost, double handling, etc. Periodic meetings with the users help identify problem areas and increase the service facility of stores. The guiding factor in all cases must be the cost of capital and benefits arising there from.

Way to save costs

2009-01-14T02:20:00.000-08:00

Physical aspects of warehousing
Physical aspect such as location, layout, and type of material, shelf life, handling equipment, storing methods, bins, racks, a passageway between stacks or displays of goods, use of preservatives play a crucial role in the context of cost reduction.

The performance of warehouse measured by cubic space and hence utilization of heights assumes importance. This storing height has to decide based on ease of storage, retrieval, and type of packages, load characteristics, flooring, roofing, ladder facility and handling facilities.

The upper limit of stacking heights depends upon the roof structure, lighting arrangements, exhaust arrangements, fire prevention facilities, use of sprinkler system, safety considerations, handling methods etc.,

Allow clearance at the top 2 to 4 feet and about six inches at the bottom free movement and prevention of dust accumulation.

Give adequate provisions for maintenance of buildings, yards, handling equipments, storage areas, wiring systems, roads etc.

Stacking method:
Unit loads to stack one over the other, in such a way to make it possible to issue out a part of the stack from top to bottom without disturbing the rest of the stack. Stability of the stack has to be ensured to prevent crashing loads. The advantage is space utilization is high, no special requirement of racks or bins. Suitable for bulk when variety is less and quantity is more.

Bins and racks
These wooden or metallic structures divide storage space in to compartments to enable items to keep individually. Arrange parallel, one foot away from walls, back to back allowing sufficient moving place. They can reach up to the roof leaving two feet above. Number properly and a file to be maintained indicating the bin number and its contents.

Loading and unloading areas
Exercise care to have sufficient space for proper maneuvering of vehicles and handling equipment. Provide weighing scale at the unloading bay of the receipt section.

Safety measures
Protection against fire hazards is one of the primary safety measures to undertake in a warehouse.
Fire is a major menace in warehouses, because of the inflammable nature of materials stored.

In case of an accident, an extinguisher on hand is better than brigade coming ten minutes later.

There must be early detection of fire and a fire fighting system, which can swing into action at once.

Fire extinguishers at strategic points, junction of gangways are immense help.

Provide a bucket of sand and another with water besides adequate number of fire extinguishers.

Gas extinguishers are hazardous.

Provide First aid and medical kits at all points

Install fire alarms and smoke detectors throughout the stores.

Inspect and update fire equipments on regular intervals.

Develop, train and retrain fire-fighting teams within the organization.

Protect pilferage. Prevention is better than cure.

Costly items that are small enough to carry are likely to pilfer.

Arrange caged enclosures or closed shelves with locks for available items to limit the access. Restrict the number of people who will have the key. Establish foolproof check out system.

Appealing to the moral value and ensuring that the wages of the workers are comparable to other organization may help reduce pilferage.

Preservatives in storage
If materials are to be stored without depreciation of their physical properties they have to be guarded against the effects of dampness, rain, dryness, heat, cold, humidity, temperature variations, dust, dirt, attack by insects, fungus formation, and other biological aspects.

Chemical items
All containers must be labeled and storage areas demarcated by visible signs.

The storage place containing chemicals well ventilated far from fire hazards. Incompatible chemicals must not be stored together.

Issue on a first in first out basis will reduce the incidence of losses in warehouses. Special care on expiry date is an exception for first in first out. The material getting expired soon to be issued out first.

Cleanliness, inspection, proper ventilation, and use of preservatives may reduce the wastage.

Layout.Security.Safety.

2009-01-13T00:54:00.000-08:00

Layout

The general principle is to minimize the total kg-km of transportation of materials, within the constraints imposed by the other environmental conditions.

It is advantageous to have the warehouse to the nearest point of usage.

Ensure adequate precautions for security against fire, leak, damage, pilferage and safety.

Handling losses at be bare minimal.

The warehouse lay out must ensure the right material in the right place, and serving the user in the most effective manner through the shortest possible distance, in the least amount of time.

Security and safety

Since stores is money (in the form of stocks), the in-charge is the custodian of the stores, he is responsible for its security. Security in all senses - fire, leak, damage, pilferage, deteriorating in storage, shelf life, handling losses, Short and excess receipt or issue, theft, etc.

The security force or the watch and ward staff keep vigil throughout the day and night, not only in stores but the entire premises of the organization.

All warehouses are to have proper locking arrangements and periodic checks to be carry.

Unauthorized entry and exit must avoid.

Safety devices like burglar alarms, smoke detectors, and fire fighting equipment to be installed. Safe working loads to be displayed. Use of protective clothing, hand gloves, helmets and gumboots and safety rules to observe by all.

Excessive fatigue should be avoided.

Provide adequate lighting, ventilation and moving space.

Prevent Electrical short circuit by way of periodical checks on wiring and fittings.

Provide proper emergency exit wherever necessary.

Train in first aid.

Use equipments like forklifts, overhead cranes etc with caution and by trained personnel only.

Handling procedures, in case of accident what to do signals are displayed on most of the original labels of the manufacturers. Manufacturing and expiry dates, batch details are mentioned by almost all manufactures wherever necessary.

Where to use and not to use hooks display and how many to stock vertically are displayed by the manufacturer.

Keep the original labels and signals intact. Follow these instruction of label for your own safety. Avoid costly damages to men, material.

No smoking is a strict norm to be followed.

The Store.

2009-01-12T05:54:00.000-08:00

The store is to facilitate receipt, storage, retrieval and issue.

Return on investment (ROI): The major corporate objective in any organization is to improve ROI.

The return on investment is return divided by investment.

Investment consists of fixed capital and working capital.

Improving ROI is possible by increasing the return or by decreasing the investment (fixed capital and working capital).

Fixed capital is not possible to reduce but return increase is possible by increasing the capacity utilization.

Approximately seventy to ninety per cent of the working capital gets block in inventories.
One important method of increasing the return is to reduce all kinds of inventories stocked in warehouses.

Material enters in to organization as raw material, components, spares or consumables. These materials converted in to finished goods and sold.

Input materials contribute to over sixty per cent of the value of finished goods.

These percentages are approximate and vary depending on the industry.

Any reduction in the inventory and its associated costs will increase the profitability substantially.

This shows the importance of economy in warehousing and the interrelated areas of purchasing, planning, logistics and inventory control.

Proper identification of how the materials have been consumed and an accurate updating of warehouse records on receipt, issue, price, balance, wastage, rejection losses, etc., are the initial steps involved in effecting economy in stores.

Reducations in obsolescence, waste minimization, reduction in queuing etc are some of the areas where stores personnel will play a major role in increasing the profitability.

PRINCIPLES OF WAREHOUSE ORGANIZATION

2009-01-11T04:02:00.000-08:00

Define and spell out resposibilities according to company objectives, per position working in warehouse..
Responsibility to commensurate with authority.
No change in scope and responsibility without prior discussion.
No employee should be subject to orders for more than a single source.
Orders should never be given to subordinates superseding a responsible executive.
Critisism should be done privately and not in open meetings.
All major and minor disputes between departments should be sorted out in coordination meetings.
The immediate superior should approve promotion, increments, disciplinary action, etc.,
No employee should be assistant as well as critic at the same time.
The quality of the assistant's work should be periodically checked and mistakes to point out so that corrective action can be taken at once.
For carrying out the above tasks effectively, the span of control or number of employees reporting to an executive should not be too large.
It is advantageous to develop an organisation’s warehousing manual describing all aspects of stores function.

Why to stock?

2009-01-10T01:31:00.000-08:00

Identification of the need is the prime requisite. Then materials required are being procured or produced. It takes considerable time. The time between identification of the need and converted into available materials ready for use is called lead time.

Materials are required to be held in stock to meet consumption requirements of this period.

In addition to the lead time there can be delays in procurement or unexpected increases in the rate of consumption.

The materials stocked in store is to provide for this contingency.

Also materials stocked for speculative purposes, expecting price rise due to increased demand or shortages in supply.

The storage of raw material and finished goods is regarded as a key element of marketing strategy.

Functionally goods held in stock enable a smooth adjustment of demand and supply.

Warehousing is not the simple act of storing goods, but rather a package of services that enables the smooth running of wheels of industry - Supplying raw materials to the operation executives and finished goods to the customers.

The warehouse should supply goods of the right quality at the right time in the right quantities to meet the pace of consumption.

It has to forecast the demand to enable procurement, receive, handle, store and transport material with out breakages or losses. Reduced wastage and obsolescence result in increased returns.

Thus the prime purpose of warehousing is strategic deployment of marketable goods in such a way as to minimise the total distribution costs and maximise customer service.

INTRO - Supply Chain Management (SCM) & my Blog

2009-01-06T05:03:00.000-08:00

Dear Friends,

Very Happy New Year to you all.

With my qualification and experience, i taken a resolution this year that Let me try and help the people who want some help, guidance and support in the subject area of Supply Chain Management and this is the result.

An Idea of blog. The title of the blog is you (u), me that is I, and Supply Chain Management (SCM).

This effort is aimed at students, aspiring entrants in to the area of Supply Chain, Professionals already in the area and looking for some guidance, to the experts who want to share their knowledge and experience.

It is aimed to be an outlet to air your ideas, questions, answers and suggestions.

Supply is business.
Supply chain management is Business Management.
Business we manage for profits.
Profit maximization or risk minimization is the essence of business management.

It is you who is involved or likely to be involved in day to day business of problem solving of your organization.

It is me, who spent about 25 years in the field of Materials management.

My philosophy is you have one rupee, i have one and if we swap we have one each.
You have one idea and i have one and if we swap we have two each.

So our interaction thru this blog will be for mutual benefit.

The participation is only mantra for the growth.

With this few words, I V.R.Sharma request you all come and join my blog and make it a success.

Knowledge is power, let us share it.