Report required to make an end product. MRP

Report on Implementation of IS AUDIT on the Textile Industry.Group members:Shahroz Anwar 20785Meerwais Khan 21355Osama RiazAga Mehdi 21417Table of content:MIS in textile industryERP in textile industryRisk Management in Textile IndustryMANAGEMENT INFORMATION SYSTEM:Management information system (MIS) is the study of people, organization and technology. It provides information through technology and it manages and supports the managerial decision within the organization.IMPORTANTANCE OF IS: MODEL OF MIS:MIS RESOURCES:-People resources:People who use the IS or the information from ISPeople who operate IS-Software resourcesSystem software, application software and proceduresAll information processing instruction-Hardware resources:All physical devices used in information processingMachines, date media, peripherals-Network resources:Communication mediaNetwork infrastructureThe internet, intranets and extranetsMIS ACTIVITIES:The activities that MIS perform are as following:Input of data resourcesProcessing of data into informationOutput of information productsStorage of data resourcesControl of system performanceADVANTAGES OF MIS:MIS has following advantagesCore competenciesQuick reflexesEnhance supply chain managementImproves personal efficiency Increases organizational controlsHelps automate the managerial processGenerates new evidence is support of a decisionHigher speed of retrieval and processing of dataFacilitates interpersonal communicationAPPLICATION OF MIS IN TEXTILE INDUSTRY:-BUSINESS SYSTEM:Future predictions can be made on the bases of past and present data and most commonly by analysis of trends for products, groups and marketing of a business. Targets are fixed by an organization and the processes are fasten up. Business plans are made on the terms for resources which are to be executed. An strategy is set by the organization to achieve their targets and objectives of the organization. Performances and working on the objective are monitored.SALES:The orders of the customers are processed properly and then an invoice is made and the product is delivered to the customer. MIS helps in making a sales analysis and collect the data to make predictions for future budgets and measuring the progress of the business. The marketing processes of the organization are very effective for the sales and customers are attracted and sales increases on a wide scale.PRODUCTION: Production planning consists of; BOM, MPR and capacity planning. BOM is the list of raw material required to make an end product. MRP is material requirement planning which is aproduction planning, scheduling, and inventory control system used to manage manufacturing processes. Capacity planning is the capacity that is needed for a product for the changing in demands of that product. A process sheet is developed by the organization for their personnel so that they can have a guideline for achieving certain objectives.FINANCE:MIS helps the organization to keep proper record of the ledger, accounts receivable and payables. It basically control all the financial accounts of the company which includes;Budgeting and planningCost accountingTax managementBank reconciliationIt also helps in the processing of the balance sheet to make everything in the record so that no frauds can occur.QUALITY CONTROL:Quality control is a process that makes sure that the customer receives the right product which is without any defects in it and meet their needs. MIS of data gathering to assess the quality  and measure against standards. Quality of the product is analyzed by this process customer satisfactory and loyalty level increases and sales of the organization keeps increasing. The benefits of quality control are-Gain repeat business-Customer loyalty-Maintain or improve the position in the market-Improve safety-Gain new customers for referrals -Reduce liability risks -Contribute to the overall positive branding of the productMATERIAL:MIS keeps all the data of the material that the right materials is being purchased which will be effective for the end product. It have all the data stored in the receipt of the good and all the records are stored in it and one can always look into it for getting the information of every good purchased which reduces the chances of fraud. Inventory is analyzed within the system. A modernized account system is made and there is a record of everything. Data is integrated within the system and is unified so anyone who is looking at the data can unify them and does not have any problem and does not miss anything important. In the end of the purchasing process a quotation is developed which goes to both the consumer and producer as a record for both the parties. PERSONNEL:A proper personnel data is developed by MIS. It looks into the information of every individual in the organization and have the record of each personnel. Personnel attendance system is developed to check that if any employee was absent too many time and which employee was consistent and their working hours are also mention in that system. It also includes their wages, salaries, incentives, bonuses, income taxes, deductions, contribution and provident funds. These personnel are being supervised by their superiors and their performances are being measured. They get bonuses if there performances are high and their salaries can be deducted if they are not working properly or are absent on too many occasions. A human resource management system is developed within MIS to make a set of planning for the employees, recruitment of the ones who are qualified for the organization, people are trained for the work in the organization as future employees in the organization who will be effective in the progress in the organization.MIS GARMENT MANUFACTURING: MODULES:*Order Module*Sampling module*Pre-production planning module*Inventory*Production control module*Sales module*Accounting module*Documentation module*Payroll management system module*MIS report moduleREPORT:*Design wise payment*Balance stock statement*Ledger*Slips*Worker efficiency*Overdue analysis*Registration report*In charge report*Agent report*Rate analysis*Purchase report*Master issue receipt report*P&L report*Lot statusMIS HUMAN RESOURCE CONTENTS:*PERSONAL HISTORY-Name-Address-Date of birth-Sex-Ethnicity-Contact number*SKILLS INVENTORY:-Skills-Specials skills-Education-Competencies*TRAINING AND DEVELOPMENT ACHIEVED:- Both internally and externally*CAREER PLANS:*WORK HISTORY:- department- job title- grade- position – position history- supervisor- salary- salary history- appraisal data- benefits selectedLIMITATIONS OF MISThe implementing and monitoring MIS requires a lot of expertise.The running of MIS programs tends to be relatively costlyCannot make creative responses as human expert would be in unusual circumstancesThe dynamic nature of MIS makes it difficult for the organizations to keep up with the principles and strategiesSystem may become slow and hard to manage because of large amount of data and lack of technical staff          ENTERPRISE RESOURCE PLANNING:Enterprise resource planning system integrates internal and external management of information across an entire , organization embracing finance/accounting, manufacturing, sales and service, customer relationship management etc. ERP system automate this activity with an integrated software application. Erp facilitates info flow between all the business units within the organization and as well as manages to hold connections with the outside.Functional areas of ERP:Financial accounting which includes general ledger, fixed asset, payables, receivables, cash management and financial consolidation.Management accounting which includes budgeting, costing, cost management, activity based costing. Human resources which includes recruiting, training, payroll, benefits, diversity management, retirement and seaparation.Manufacturing which contains the areas of engineering, bill of materials, work orders, scheduling of work, capacitating materials, quality control and checking, manufacturing projects and product lifecycle management.Supply chain management which has the planning of supply chain, how to schedule the supplier, purchasing raw materials or goods , inventory, and the how to process a claim if it occurs.Project management contains careful planning of the project, scheduling the resources, cost associated with the project, the duration of billing, time and expense and the units of performance.There are different types of software for textile industry such as ACS OPTIMA, BANN, BPCS, DATATEX, INTENA MOVEX FASHION, JD EDWARDS, POINTMAN, SAP.Development of ERP packages for textiles:ERP prime focus is to facilitate a companywide integrated information system which can cover all the fuctional areas such as manufacturing, sales and distribution, general ledger such as accounts receivable, payables, inventory and HR. The steps in the development of the program are as follows :Define the problemDesigning the programmeDebugging TestingDocumentationMaintainenceRedesignDEFINING THE PROBLEM :This part includes feeding of data for eg. The specifity of the processing requirements ( input and output both ). When one is designing the system he must be aware of the different and various parameters which are incorporated here.Fibre Module: It is the price at which the fibres are sold in the market, also it is related to the technical specification like the grade of the fibre, fineness of the fibre used,.Yarn Module: The yarn module is in various parts.The technical parameters such as the quantity of yarn, the weight of yarn used, cv percentage, the twisting capacity, quality of the yarn, the breaking or tensile strength and the irregularity of the yarn.The production details such as lot number( the lot they belong too) the shift production,  efficiency of the  yarn and the waste which has occurred due to the yarn.The parameters of the process which are carding and spinning of the yarn to create the the fibre.The last thing here is the commercial use that is the market price on which they will be delivered and the final use of the product that means for what use they will be best.Fibric module which includes the yarn count for wrapping, the quantity od reed used. The no. of ends and picks per inch. The process specification at the winding.The next thing here is the process details like weight of the fibre, width of the fibre, the number of knots, pasting size, take-up size, the faults occurring in the fabrics.Marketing module:  This deals with the store section and the various parameters associated with it are stock. Finance module: This area deals with the HR cells and has the following parameters such as database on the HR, performance of the employees and staff, the perfect and useful allocation of the employees, and staffing and recruiting the best possible employees.2. Designing the programme:The first step is to check the study the incoming orders, check whether it is feasible for you to work accordingly and can deliver the amount you are requested for, then you need to suggest them the best possible and available delivery, after that manage the entire order cycle from acceptance to entry  in the list, shipping of your order, invoicing or billing, managing the price list of your product throughout your market. Orders accepted through internet means.The second step the coding of article that is to give different codes to different end products. The code structure of a particular end product maybe named in accordance to the software developer or its user or the parameters required.The third step is planning that is working on your product through a given budget allocated and then plan your production and then calculate the material, required and the capacity required to store or produce the material and then the laundering of the production orders.The fourth step here is the checking of the manufacture of the oroduct. It allows the planning, laundering and tracking of the production activities inside the whole cycle and the means to handle the the faults in reporting and mapping.  Good care should be taken at the time of purchasing and the policies regarding stock by specifying the optimum inventory levels , reordering of the quantities and replenishment times. 3. Debugging is the procedure of correcting any of the errors encountered while working. Testing is the checking of the correction of the individual progarmme earlier aswell as thec complete system which is used.Documentation gives the complete and useful information or description of package and details in order to execute the system.Maintainence is the preservation the complete package from start to finish.Redesigning is the extent or the changes as per the requirement of individual situation or the situation at the present time.ERP solutions for textile industry: Preparation of project profile and project report: That is to prepare the type of file and report used.Preaparation of the loan application: it means it can serve for the approval of loans from financial institutions.Selection of the site of project, the plant installation and machinery needed.Building up a layout plan to design the plan easily and efficiently.The recruitment and selection process is made much easier and less time consuming.Helps during the trial productions and later the commercial production.Assists us in identification of what market best suits our product either international or domestic.The challenges it faces are : Demand planning: the forecasting of longterm sales order.Time period: meeting the customer deadlines which were set up earlier.Production planning:  flexible production plan and reduction of the plant setup time so that customer order specifications are met.Integration: a lot of nonintegrated IT approach which results in lots of disparate IT systems.Automation: the automation of the plant and the quality management systems involved.Conclusion : The textile companies are looking forward to ERP solutions which can assist their particular needs. The textile industries are looking forward to integrate their supply chain management with their intelligence systems. The latest ERP systems offer need based applications. The firms now need not worry about their Software programs they can install software programs pertaining to what they require.Risk management In Textile Industryis the decision making process involving considerations of political, social, economics engineering factors with relevant risk assessment relating to a potential hazard so as to develop analyze & compare regulatory options & to select the optimal regulatory response for safety from that hazard. Essentially risk management is the combination of 3 steps:risk evaluation,emission &exposure controlrisk controlFUNCTION OF RISK MANAGEMENT The function of risk management is to reduce the risk of loss and minimize its effects through: Identification of sources of Property, Net Income, Liability, and Personnel risks from which losses may arise; . Evaluation of the financial risk involved in each exposure in terms of expected frequency, severity and impact;  Treatment of risks by: • Elimination or avoidance • Reduction or control • Transfer to others • Funding Monitoring of results continuously and systematicallyRisk Identification After establishing the context, the next step in the process of managing risk is to identify potential risks. Risks are about events that, when triggered, cause problems. Hence, risk identification can start with the source of problems, or with the problem itself.Source analysis Risk sources may be internal or external to the system that is the target of risk management. Examples of risk sources are: stakeholders of a project, employees of a company or the weather over an airport • Problem analysis Risks are related to identified threats. For example: the threat of losing money, the threat of abuse of privacy information or the threat of accidents and casualties. The threats may exist with various entities, most important with shareholder, customers and legislative bodies such as the government .Risk AssessmentOnce risks have been identified, they must then be assessed as to their potential severity of loss and to the probability of occurrence. These quantities can be either simple to measure, in the case of the value of a lost building, or impossible to know for sure in the case of the probability of an unlikely event occurring. Therefore, in the assessment process it is critical to make the best educated guesses possible in order to properly prioritize the implementation of the Risk Management PlanTYPES OF RISK TEXTILE INDUSTRY FACES:Political risk Political risk may be defined as the probability that a political event will impact adversely on a firm’s profit. The risk that a new law or a change in an existing could have a significant impact on an investment. Whatever laws the government passes today may not be extinct tomorrow. Political risk represents the financial risk that a country’s government will suddenly change its policiesThis risk covers Restriction on remittances in the buyer’s country or any government action which may block or delay payment in rupees to the exporterWar, revolution or civil commotion in the buyer’s country.  Imposition or new import licensing rest ructions in the buyer’s country or cancellation of a valid import licenseCancellation of an export license of imposition of new export licensing rests ructions ion. Additional handling, transport charges due to interruption or diversion of voyage, which cannot be recovered from the buyer. Operation riskOperational risk is defined as the risk of loss resulting from inadequate or failed internal processes, people and systems, or from external events. Risk associated with the potential for system failure in a given market”. “It is associated with systems processes & people & covers such as succession planning, human resources, information technology, control systems & compliance with regulations”.”Operational risk is an expression of the danger of unexpected direct or indirect losses resulting from inadequate or failed internal process, people & systems or from external events”. This risk covers External fraud- theft of information, hacking damage, third-party theft and forgery  Business disruption & systems failures- utility disruptions, software failures, hardware failures.Execution, delivery, & process management – data entry errors, accounting errors.Employee risk Health and safety issues are a constant problem in the garment industry. It is very necessary for the management to develop the Labour welfare condition, which will motivate the employees to do more and will help to achieve the satisfaction. This risk covers • Illnesses • Infections • Injuries The work environment in a majority of the units is unsafe and unhealthy. The people working in such poor or standard environmental prone to occupational diseases.These illnesses are due to: excessively high temperature – or very low temperatures; dust; inadequate ventilation; inadequate lighting; excessive noise; lack of fire-fighting equipment; blocked exits; bad sanitation; unhygienic canteens; and lack of drinking water. The types of illnesses, which may affect the employees in company, are fevers, headaches, eyesight problems, skin allergies, kidney infections, backache, stomach cramps, breathing difficulties and constant exhaustion. Exhaustion, ergonomic problems – which relate to the movements necessary to carry out the work, the conditions in the factory environment – the deprivation of basic bodily functions such as drinking water and using the toilet are reoccurring problems for workers.Purchasing power riskThe loss of purchasing power due to the effects of inflation. When inflation is present, the currency loses its value due to the rising price level in the economy. The higher the inflation rate, the faster the money loses its value. This risk is also known as inflation risk. “The risk of loss in the value of cash due to inflation”.Example • The cotton textile industry is dependent in the vagaries of nature. Availability of the required quality & quantity of cotton is critical for business and any damage or fall in crop production can adversely impact the price of cotton, which can impact business performance & profitabilityTechnology risk Many institutions such as banks, investment management firms, insurance companies, brokerage firms, technology is a critical component of any risk management initiates for institutions which rely heavily on technology, there is always a risk technology becoming the focus on risk management. “Technology can response corporate cultures & facilitates innovative procedures”. In a garment manufacturing firm, the production manager has been with the firm for over thirty years and has thus seen all the changes and transformations in the production processes over time.Many institutions such as banks, investment management firms, insurance companies, brokerage firms, technology is a critical component of any risk management initiates for institutions which rely heavily on technology, there is always a risk technology becoming the focus on risk management. Currency risk It is the uncertainty associated with changes in the relative value of currencies. “Currency risk arises due to uncertainty in exchange rates”. Currency risk is a form of risk that arises from the change in price of one currency against another. Whenever investors or companies have assets or business operations across national borders, they face currency risk if their positions are not hedged The risk that a business operations or an investments value will be affected by changes in exchange rates. These risks usually affect business, individual investors who make international investors. This is also called as exchange rate risks