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MGT613 Production/Operation Management, Assignment # 1 Opening Date November 27, 2014 and due date will be December 03, 2014.

Important announcement

Assignment # 01

production/operations management (mgt613)


Dear Students!

This is to inform that Assignment No.1 will be opened on November 27, 2014 and due date of assignment submission will be December 03, 2014.


A 24 hours extra/grace period after the due date is usually available to overcome uploading difficulties which may be faced by the students on last date.  This extra time should only be used to meet the emergencies; and above mentioned due date should always be treated as final to avoid any inconvenience.


Marks: 10
Pakistan for the last many years is exporting textile goods and garments in many countries
of the world. The textile products made in Faisalabad are exported to Europe and many
other countries. Last year Pakistan was given GSP Plus status and it is predictable that the
demand for Pakistani textile products will boost up. At the other hand the condition at
home is different. The country has severe scarcity of gas and electricity, and everyday we
find workers and mill owners protesting on roads.
Jahagir textile mill (JTM) which was established last year is a strait of the art processing unit.
It has tremendous potential to gain major share in export quota but it has to compete with
many big exporters in the country.
Owing to your subject knowledge of Production/Operations Management answer the
following questions.
1. What advantage JTM has to establish its name as an international brand?
2. How JTM should compete with big exporters in country to get major share in GSP Plus
export quota?
3. What strategy JTM should adopt to meet the gas/electricity shortage to produce cost
effective products?
4. As a Production/Operations Manager how can you make forecasting more accurate?
Note: every question carries equal marks. The answer should be precise and comprehensive. Every
answer should not have more than three bullet points explained in one or two lines.

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Assignment File :

Fall 2014_MGT613_1.pdf

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Please Discuss here about this assignment.Thanks

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The GSP Plus status 

The European Union has granted the Generalized Scheme of Preferences (GSP) Plus status to Pakistan in December 2013. This status is likely to increase access to the EU market through duty free imports of GSP-eligible products. The grant of the GSP Plus status is effective from January 1, 2014. This is indeed a positive development and all those who contributed to achieving this status must be congratulated. 

The EU is not only one of the largest trading partners of Pakistan, but is actively engaged and contributing effectively to socio-economic development of Pakistan. Trading relations have, however, weakened over the years. One-third of Pakistan’s exports used to go to the EU in 1995-96. These declined to one-fourth in 2000-01 and further declined to almost 10 percent by 2010-11. The slower pace of economic activities in Pakistan since 2007-08 and the emergence of the European debt crisis in the aftermath of the great recession appear to be the reason behind the weakening of trade relations. 

While approximately 12 percent of Pakistan’s remittances come from the EU, foreign investment from there has declined rapidly in recent years. Almost 35 percent foreign investment originated from the EU in the mid-1990s. It increased to 43 percent in 2000-01 but declined drastically to 11.5 percent by 2010-11. Factors like the economic slowdown, less than satisfactory security environment, energy bottlenecks, and poor governance since 2007-08 appear to have contributed towards making Pakistan a less desirable destination for foreign investment. 

European countries introduced the GSP in 1971 with a view to helping developing countries develop and diversify their exports. Under the GSP, the European countries either eliminated or reduced import tariff on specified products exported by approved developing countries, including Pakistan. This tariff preferential regime has been extended to GSP Plus through additional tariff reductions to vulnerable developing countries. The objectives of GSP Plus have been to assist developing countries in reducing poverty, improving governance and promoting sustainable development. 

The tariff advantages provided by the GSP Plus status are powerful and must be exploited by our exporter and government. However, they are not the only factor that can make Pakistan more competitive in the EU market. Tariff preferences under GSP Plus are subject to quantity restraints and safeguards. These instruments are not applied to exports under MFN rates (more than one-half of all MFN tariff lines are set at zero percent and another one-quarter are below five percent). The EU buyers, therefore, prefer imports cleared under MFN because they are more reliable and sustainable and are not subject to quantity restraints and safeguards as well. 

Although the prospects of duty-free under the GSP Plus access for textile and clothing suggest enormous scope for Pakistan’s exports expansion, the reality is somewhat different. The applicable quantity threshold, that is, tariff preferences are not available to a country for a product whose exports exceed six percent of the EU’s annual GSP imports of that product, means that Pakistan’s textile and clothing exports will largely remain subject to MFN imports duties. 

The applicable safeguard provision under which tariff preferences are withdrawn when imports of textiles increase by 14.5 percent and all other products by 17.5 percent over a period of three years. An authoritative research study has estimated that a total of $600 million (that is, roughly $300 million in textiles, $100 million in leather products and $200 million in all other products) can be additionally exported to the EU at zero percent duty without attracting safeguard action. 

Many non-textile products such as sports goods, surgical instruments and Basmati rice, copper and animal casings, already enter the EU duty free under either GSP or MFN rates. For these products, the GSP Plus tariff preferences will have no positive market access impact. Nonetheless, the greatest scope for expansion of Pakistan’s exports lay with textile and clothing sector under the GSP Plus package. 

This preferential duty regime will not suffice to secure sustainable market access to the EU. They are merely a catalyst. The government and industry need to invest in higher technology, standards compliance, certification, quality control and packaging, and demand-driven output. The GSP Plus status will not be there forever; therefore, investment must be made to make this sector competitive on a sustained basis. 

It is also to be noted that the GSP Plus advantages perceived to accrue to Pakistan may attract strong defensive action from EU competitors like Italy, Portugal and Greece in textiles and Romania in clothing; and offensive actions from non-EU competitors like Bangladesh, India and China. How to face these defensive and offensive actions will be a real challenge for Pakistan and its textile industry going forward.

Some of the serious impediments to increasing exports not only to the EU but to all markets are rising cost of production, low productivity, volatile prices of raw materials, difficulty in achieving the required market standards, costs of certification, lack of customer confidence inconsistent levels of quality control and supply driven exports that are unresponsive to the EU market demand. The EU market is lucrative and highly profitable, but at the same time it is also very sophisticated and competitive. Pakistan must use its GSP Plus advantages to improve upon the factors listed above. 

The GSP Plus status granted to Pakistan is conditional on the ratification and implementation of 27 international conventions in the areas of human rights, labour standards, environment and good governance. Adoption of these conventions will assist Pakistan in integrating into the cross-border supply chain which will strengthen manufacturing activity and further promote its exports. Pakistan has ratified almost all the conventions. The most critical aspect of these conventions is that their compliance will be strictly monitored by the EU through the unnamed third parties from civil society or NGOs. 

Another critical challenge pertaining to the compliance would emanate from the 18th Amendment to the constitution. As a result of the 18th Amendment, there has been a shift of power relevant to the conditions of GSP Plus – from the federal to the provincial governments. While the federal government has worked hard to get the GSP Plus status and is responsible for monitoring and reporting of the 27 conventions, implementation of the corresponding domestic legislation is largely the responsibility of provincial governments, perhaps not yet ready for compliance. The federal government must establish a supervisory body to coordinate with provincial governments in this respect. 

The extension of the EU’s GSP preferences to Pakistan will certainly boost its competitiveness, but ultimately success in accessing the EU market in greater quantities will depend on Pakistan’s ability to meet EU consumers’ demand both in terms of quantity and quality, to increase its production efficiency, to invest in technologies and skilled manpower, and to be able to withstand its competitors’ defensive and offensive actions. 

GSP Plus alone will not suffice. The short-term advantages of tariff preferences under GSP Plus must wisely be invested for long-term goals, not short-term profit.

The Generalized System of Preferences, or GSP, is a preferential tariff system which provides for a formal system of exemption from the more general rules of the World Trade Organization (WTO), (formerly, the General Agreement on Tariffs and Trade or GATT). Specifically, it's a system of exemption from the most favored nation principle (MFN) that obliges WTO member countries to treat the imports of all other WTO member countries no worse than they treat the imports of their "most favored" trading partner. In essence, MFN requires WTO member countries to treat imports coming from all other WTO member countries equally, that is, by imposing equal tariffs on them, etc.

GSP exempts WTO member countries from MFN for the purpose of lowering tariffs for the least developed countries, without also lowering tariffs for rich countries.

plz anyone explain question no1 that what we have to explain in question 1

only write the advantages of international brnad.

Dear Students Don’t wait for solution post your problems here and discuss ... after discussion a perfect solution will come in a result. So, Start it now, replies here give your comments according to your knowledge and understandings....

please help and give some hint about the topic

1.  What advantage JTM has to establish its name as an international brand?
2.  How  JTM  should  compete  with  big  exporters  in country  to  get  major share  in  GSP  Plus
export quota?
3.  What  strategy  JTM  should  adopt  to  meet  the  gas/electricity  shortage  to  produce  cost
effective products?
4.   As a Production/Operations Manager how can you make forecasting more       accurate?

any idea about 2nd q

its not mine its just for idea ...........

As a Production/Operations Manager how can you make forecasting more accurate?

 Both qualitative and quantitative data must be available, timely, c0mpletly, accurately, and related to the problem. Stakeholders, both internal and external must be c0nsulted. Closely monitor the competitor activities and make a plan according to their plan. Forecasting should be planed, c0ncise, easily understandable to others involved. Yes sure, this data is collected by customer and other outside bodies, and by internal bodies like your workforce or entrepreneurs etc.

Watch the market growth rate, and monitor political situations. Forecasting can also be related to demand in the market in near future, or machines working hours and output. Forecasting must be flexible

its not mine just for idea....

What strategy JTM should adopt to meet the gas/electricity shortage to produce cost effective products?

Procedures, processes, systems and machines must be cost effective and efficient. Machines should be technologically go0d and updated whose c0nsumti0n of gas and electricity low. They can manage their tasks according to load shading schedule to be cost effective. They must hire specialized workforce for different tasks who can make sure quality products with less available resources, making sure less material wastage and m0re output.

What strategy JTM should adopt to meet the gas/electricity shortage to produc
e cost
effective products?

in my point of view is question me alternative solution poucha he related with gas/electricity shortage, is scenario me production cost b increase na ho.......... miss soha

its not my ans esi leye yaha post kiya hy k shayad koi thek se bata de


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