Submitted to: Yurika Uematsu Bhuiyan (YUB)

Course: MGT314
Section: 04
Report on: Operations and Supply Chain Management
issues of Polar Ice Cream Company Bangladesh.

Group: Sky Walkers

Name ID

Dewan Tangil (Project Manager) 1620151060

Mohammad Ahsan Hasib 1620459030

Fatima Akter 1612362630

Amena Akter Mim 1620741630

Nafiza salsabil 1621106630

Md shafiqul islam 1620184630

Tajkia Tarannum 1620090030

MD Shohanur Rahman 1620206030

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 LETTER OF TRANSMITTAL

April 20, 2019

Yurika Uematsu Bhuiyan

MGT314- Course Instructor

North South University

Dear Respected Mam,

This is our project report based on ‘Operations and Supply Chain Management issues of Polar
ice cream company Bangladesh.’ The report has been prepared providing all the information
mentioned in our project outline.

The report has been constructed with the contributions of all the members of group sky walkers
equally.

We would like to thank you for all your checks and balance process during the whole semester.
Without your wonderful guidance it wouldn't be possible for us to complete our report.

Yours sincerely,

Group: Sky Walkers

1. Dewan Tangil (Project Manager)

2. Mohammad Ahsan Hasib
3. Fatima Akter
4. Amena Akter Mim

5. Nafiza salsabil

6. Tajkia Tarannum

7. Md shafiqul islam

8. MD Shohanur Rahman

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Table of Contents
Executive summary ................................................................................................................................. 4
Overview of the Business ....................................................................................................................... 5
Goal:.................................................................................................................................................... 5
Mission: .............................................................................................................................................. 5
Vision: ................................................................................................................................................. 5
Analysis of existing Production and operation strategies ....................................................................... 6
Production analysis ............................................................................................................................. 6
Process selection ................................................................................................................................. 6
Facility Layout ........................................................................................................................................ 7
Process Map ............................................................................................................................................ 8
Workstation Calculation ......................................................................................................................... 9
Steps on their process.......................................................................................................................... 9
Precedence Diagram: .......................................................................................................................... 9
Operation Strategies .............................................................................................................................. 10
Application of Production and Operation Management ....................................................................... 11
Inventories............................................................................................................................................. 13
Inventory Counting System .................................................................................................................. 14
Analysis of quality control issues ......................................................................................................... 15
DEMAND FORECASTING ................................................................................................................ 16
Operational Problems............................................................................................................................ 19
Recommendation .................................................................................................................................. 20
Appendix ............................................................................................................................................... 21

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Executive summary

The report is based on the operation and supply chain management course. Only this purpose,

we were visit a factory and witness their everyday operation. Polar ice cream brand was chosen

for this reason, since Dhaka ice cream industries ltd. pioneered in the first hygienically

produced and packed ice cream in Bangladesh, Polar ice cream brand is the member of Dhaka

Ice Cream Industries limited. They have many types of ice cream such as ice cream cake, cup,

Lolly, Malai, Chocobar , Cone etc. But we take only one type of ice cream like Malai for our

project.

The analysis of the goal, mission, vision, strategies, competitiveness, productivity, process

map, quality control issue, demand forecast, strategic capacity planning, inventory

management, project management, triple bottom line and supply chain management have been

done in this report for polar ice cream brand and the required recommendation and suggestions

made, for the betterment of the company in the near future.

Some of the information is usually not obtainable in the website. The information we have

gathered revolves around the factory and supply chain of the company Dhaka Ice Cream

Industries ltd. For this reason, we conduct an interview with the senior section manager Md.

Maynul Islam of supply chain management and we also visited their factory situated at Shaheed

Tajuddin Ahmad Sharani Tejgaon I/A, Dhaka, Bangladesh.

After the factory visit, we were able to understand the procedure of the firm better, along with

the things taught in our class.

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Overview of the Business

Dhaka Ice Cream Industries Limited, manufacturer of polar brand ice cream came into being

in 1987. Dhaka ice cream industries ltd. pioneered in the first hygienically produced and

packed Ice Cream in Bangladesh, with the important ingredients mostly from renowned

manufacturer of Australia, European etc. Prime concern of Polar ice cream is the food safety

to the valued consumers. Polar’s range extends to a wide range of coated ice creams, cup ice

creams, stick ice creams and ice lollies in an array of delicious flavours and tastes. With cold

hubs in Dhaka, Gazipur, Chittagong, Comilla, Sylhet, Bogra, Rangpur, Rajshahi, Khulna and

Jessore the distribution of Polar Ice Cream can be found almost everywhere in the country.

For long distance delivery points they have commissioned freezer vans. The Polar family

stands strong to satisfy customers, consumers and other stakeholders with high quality ice

creams and superior services. They are continuously innovating products, processes and

services to stay modern and preferred. The Polar family has a healthy, sensible and positive

minded approach towards everything they do.

Goal:

Polar is in the business of making people happy with its ice creams. Every time Polar ice

creams bring out smiles, making your moments a little special, Polar gets a step closer to its

goal.

Mission: To provide quality products & services that is consistently exceed customer’s

expectations.

“The consumer’s happiness is our happiness”.

Vision: To manufacture the best value ice cream they use the highest quality ingredients and

then to sell their products according to a strategy that they believe maximizes savings for

their customers.

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Analysis of existing Production and operation strategies

Production analysis: We came to know form our lectures that there are four types of

processes and they are –

1. Job shop

2. Batch

3. Repetitive or assembly line

4. Continuous

Process selection: Polar selects their process according to -

Variety – How much they can produce

Flexibility – what degree they can change

Volume – what would be their expected output?

After analysing these three things they have selected their process as repetitive or assembly

line process because-

 They use same mixture in different boxes or packets with extra flavor and quantity. So

there are less variety in products.

 They produce high volume of ice creams.

 The equipment are not as flexible as in a job shop and batch. They cannot be moved

easily.

 The workers are not that much skilled, they are highly depended on machines.

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Facility Layout

According to Mainul Islam, (senior section manager), among four types of facility layouts

polar uses Product layouts for their production.

Product layout: Layout that uses standardized processing operations to achieve smooth,

rapid, high-volume flow. The product layout of polar includes –

Raw materials  Mix processing area (plant 1 & plant 2) 

Pasteurization  homogenization  Aging 

Freezing  Packaging  hardening  storing -35◦C  Warehouse

(FIFO)

It can be more understandable if we follow the process map!

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Process Map

Planning for the Collection of raw materials

finished good

Checking
by Quality
Check
team

Return it
Quality
is
good?

NO

YES

Pasteurization Mix
Homogenization Preparation

Freezing Packaging
Aging

Distri- Storage
Liquid
bution -35◦C
Hardening
Tunnel
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Workstation Calculation: The Polar Ice Cream Company Bangladesh sells varieties of

products, but this calculation has been done on Malai Ice cream from their given information.

They have provided us the Cycle Time for their Malai Ice cream.

It is CT= 6.0 min

Steps on their process:

A. Aging of the mix – required 0.6 min

B. Adding liquid flavour and colour – required

C. Freeze

D. Add Bulky flavour and other elements

E. Packaging

F. Hardening.

Precedence Diagram:

A B C

0.6 1.4 4.0 Work station 2.

Workstation 3.

Work station 1.
D E F

1.6 0.4 6.0

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Here,

Nmin. = Total time / CT

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= 6

=2.33= 3

Now,

Idle time of work station 1 = 6.0-0.6-1.4 = 4.0

Idle time of work station 2 = 6.0-4.0-1.6-0.4 = 0

Idle time of work station 3 = 6.0-6.0 = 0

Total Idle time = 4.0+0+0 = 4.0

𝑻𝒐𝒕𝒂𝒍 𝒊𝒅𝒍𝒆 𝒕𝒊𝒎𝒆 𝟒.𝟎

Percentage of Idle time = = 𝟑 𝒙 𝟔 = 0.22 x 100% = 22%
𝑵𝒂𝒄𝒕. 𝒙 𝑪𝑻

Efficiency = (100-22) % = 78%

Operation Strategies

According to Mainul Islam, senior section manager, we came to know that they use some

strategic factors to achieve distinctive competencies like,

 Quality

 Time and flexibility

 Price

Now let’s see how the use these factors to establish strategies -

 They follow quality based strategies.

 Sometime they increase cost to decrease customer - supply gap and improve quality.

 They do not use preservatives to maintain high quality and reduce cost.

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  Use temperature as preservatives.

 If there is any shortage in packets which are delivered from Turkey, they make

immediate air shipment.

 Their business is seasonal business, so they made a schedule to manufacture.

 Design their product in a cost reducing way, use same mixture to make different types

of ice cream, just add flavor and change the boxes according to quantity.

 Also designed their work stations to reduce lead time.

Application of Production and Operation Management

We learn many things about production and operation management which related with polar

ice cream supply chain management.

Forecasting - They forecast their ice cream demand and supply. They seat on meeting with

sales and marketing department, and then take a review what amount of ice cream demand

will they face on a year and how much they can supply. Discussing all matter and season they

forecast demand and supply. We also have talked about forecasting in details in our demand

section.

Inventory - They purchase their necessary inventory. Polar distribute their inventory based

on their forecast and do quality assurance. They set a target and made a schedule for finishing

the production on time and for proper delivery.

Customer service - Polar do not compromise on their customer service, for that they if face

any shortage on their product producing then they use safety stock, by finding goods on local

markets or by air shipment from another country. Beside those they also follow supply chain

facilities, like warehouse.

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Productivity- Productivity of polar is efficient, every worker continuously work on their

warehouse. Machine productivity of polar also very efficient.

Polar maintain all elements of supply chain management and maintain those elements issues

very effectively as, customer matters they determining what customer wants and what types

of variation customer needs they run their product process based on that. Polar processing

side they maintain controlling quality like they store their ice cream on a cold store

warehouse which have -35 temperature , when they send their ice cream they make sure that

the truck have -35 temperature . And maintain their workstation with a fixed time. Polar

meeting demand while managing inventory costs.

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Inventories

Independent
Ice Cream Demand

Dependent
Demand
Mix Preparation

Pasteurization

Homogenization

Aging

Freezing

Packaging

Hardening

Inventory Management

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Raw Material: Polar collect raw materials within four months from New Zealand, Australia

and Germany and store them in their inventory as March to October is the pick time of their

production for summer season. These raw materials have rechecked in the beginning of the

production starts.

Work in Progress: After starting the production of ice cream they start with mix preparation

then pasteurization and homogenization. To set the ice cream from liquid they keep it on aging

which they have to store for 48 hours. Before taking it to the machine they store the unfinished

goods to freezer as their inventory of work in progress.

Finished Goods Inventory: Taking goods from the inventory of work in progress they put it

in machine to give a shape of ice cream and package them in their order. Now this becomes

finished goods and then they store it on hardening tunnel where they keep it for distributing.

Replacement Part: From the inventory of finished product they make a lead time to supply

their product and supply them in their order.

Pipeline Inventory: Polar distributes their product from the final storage in order to the

demand of ice cream in all locations.

Inventory Counting System

Perpetual Inventory System: Polar uses perpetual inventory system for their raw materials in

a first in first out basis. This system keeps track of each items removal continuously. And gives

the current amount of inventory they have.

Universal Bar-Code: Polar uses bar code system for their packaged product. A printed bar

code level is attached to their package and by scanning them it is easy to find how many and

where the product is stored.

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Analysis of quality control issues

Quality control is the inspection act of all the activities and task needed to maintain at the

desire level of nobility. A perfect quality management part is needed to ensure quality.

So after visiting the company we have come to know that they do their best to keep the best

quality of their products. They told us that, for keeping good quality of product, follow some

steps. These are-

 Online base: They always keep them update that what the customer wants by using

their website and Facebook page.

 Analytical: Keep tract about using of fat. (They never use preservatives chemical)

 Microbiological test: This test takes place 15 days per month.

They are also approved by BSTI and BUET test. They claimed that 15 people always work

for the quality control.

They have also claimed that they face some quality control issues. And that issues can be

described easily if it is shown in a chart, what we have found by talking with them. And we

can relate these issues with cause and effect diagram or fishbone diagram.

Materials
Methods

Poor forecast Out of electricity

Manual Boxing
Environment Effect
Traffic & Strike New employees
New machine
Sick leave
Broken Machine

People Equipment
tttttt
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Environment: This is the most significant issue of their quality control. It becomes harder

for them to keep the quality of their product during traffic and strike when it is in transit.

Methods: They have automated system for packaging their products. But when they put their

product in the box that work is done manually, which is very time consuming. Sometimes

they do poor forecasting, because the demand is changed by the weather.

Materials: They fall in a great problem when they are out of electricity. Though they have

generator electricity system but they claimed that it is very costly.

People: They face the shortage of employees when their employees leave for sick. As well as

the production rates get lower when they appoint the new employees.

Equipment: Sometimes some machine fail to work properly and it requires a new machine.

And the new machine does not work smoothly as the old one, which can be effect on the

quality control.

Effects: So, overall this causes in the fluctuation of demand, and they also cannot control

their product quality properly. And it increases their losses.

DEMAND FORECASTING

Forecasting means the future values of any variables. Demand is one of them. In terms of

forecasting the demand for the polar company we use three method- Moving average,

weighted moving Average, and exponential smoothing.

Among the various product line we are forecasting the demand for one of their best selling

product called “Malai”

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Moving Average:

Period Demand

1 1200

2 1400

3 1100

4 1600

5 1000

Calculation the three-period moving average for demand in period six.

F6 = (1000+1600+1100)/3 =1233.33

Here we can see that the average forecasted demand for the period six is 1233.33

Weighted Moving Average:

Period Demand Weight

1 1200

2 1400 10%

3 1100 20%

4 1600 30%

5 1000 40%

Four-period weighted moving average demand forecasting for the period six

F6 = (.1*1400)+(.2*1100)+(.3*1600)+(.4*1000) = 1240

Here taking weight in to account we can see that the forecasted demand has changed to 1200.

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Exponential Smoothing:

Period Actual [α= 0.01]

Demand Forecast

1 1200 -----------

2 1400 1200

3 1100 1220

4 1600 1208

5 1000 1247.2

Calculating exponential smoothing-

F3 = F2+α(A2-F2)

=1200+.1(1400-1200) = 1220

F4 = F3+α(A3-F3)

=1220+.1(1100-1220) = 1208

F5 = F4+α(A4-F4)

=1208+.1(1600-12008) =1247.2

Based on the pervious years demand the forecasted demand for period six will be

F6 = F5+α(A5-F5)

= 1247.2+.1(1000-1247.2) = 1222.48

Here we see continuous change in forecasted demand every year.

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Operational Problems

Though polar is a brand and a big company, having exclusive tools and equipment they also

have to face some operational problems. According to Mainul Islam, senior section manager

of polar, Problems that Polar face during their operations are-

1. Unusual pick:

They make their manufacturing plan yearly, the sales department gives the forecast to plan.

As they are ice-cream manufacturing company they have full sales on March to October. But

the rest four months their sales go down. On season sometimes the demand goes 20% up, so

they make backups on the off season.

2. Supply demand gap:

Sometimes if the forecast does not go well they have to face supply demand gap. In that

situation they have to take immediate action to meet that gap. In that situation they usually

increase cost to reduce that gap.

3. Recognizing Alternatives:

If they face any shortage they had to recognize alternatives to face that situation. In that case,

recognizing alternatives become an issue for them.

4. Manual Packaging:

Polar uses manual packaging which increases their lead time. Production process slows down

during this packaging part.

5. Unavailability of packets in BD:

The papers they use to pack their cone ice creams are ordered from Turkey as these are not

available in Bangladesh this sometimes create issues. If the forecasted demand of the packets

19
are not enough for the production they might need to make an immediate order for packets

and might need to an air shipment, which might increase the cost.

Recommendation

Overall performance of Polar is really good. But they have mentioned some of their problems

what they are facing the most and we have also find some significance obstacles and time

consuming works, which they should change immediately.

First of all, they have the automated machine for packaging the products but the boxing

method of products are done manually by the workers. Which may affect the quality of the

products. As well as it is also very time consuming method. So they should develop their

boxing method of the products to keep the quality good and to minimize the time of boxing.

Secondly, they claimed, the packet of cone ice cream come from Turkey. So we think they

should keep an alternative way to get the packet if the shipment of the packet delay.

Lastly, they have mentioned that sometimes they fail to meet the demand, but which is not

that much major concern to them as because they had already met the forecasted demand. In

counter they have mentioned that they are working on it. So here we think if they do the

appropriate forecasting and keep a good relation with the suppliers and distributors, they will

not face this kind of problems anymore.

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Appendix

We, “The sky walkers” Visited Polar Ice cream’s Factory located in Mohakhali on 20th march

2019. There We were briefed by their chemical engineer Imteaz Ahmed and senior section

manager Mainul Islam. We were provided information regarding the production by Mainul

Islam, Senior Section Manager, whose visiting card has been provided in this report. Here we

are attaching our photo with Mainul Islam at polar.

Team Sky Walkers With Mainul Islam, senior section manager of Polar Ice cream at Polar

Ice cream Factory

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