SUSTAINABILITY REPORT 2013-15

People Overview Self Managed Teams Mechanisation Safety Overview The Parivartan     Journey Progress on     Roadmap Incident Statistics Robust Governance Standardised     Processes Enhanced Awareness Capability Building Safety Infrastructure Safety Audits Quality Overview Top-down    Accountability Quality by Design Quality Culture     Transformation Quality Assurance Quality     Best Practices All Time Audit     Readiness Availability Overview Strategic Sourcing Risk Management Product    Rationalisation Success stories Environment Overview Roadmap Energy Management Emissions Water Waste Case Study KPIs Community Overview Focus Areas Education Livelihoods Healthcare Infrastructure     Initiatives Creating Change     Makers Productivity Overview Productivity Streams Case Study PACE Update Initiatives Engineering Excellence Overview Digitisation Automation Mechanisation Lean Manufacturing Capital Equipment Strategy Predictive Maintenance Continuous Improvement Overview Continuous     Improvement     at Work Best Practices Annexures GRI Index Acronyms Assurance Statement   Summary Report     ECONOMIC PERFORMANCE SUSTAINABLE SOURCING Overview    |    A Chain is as Strong as its Weakest Link    |    Adding Value to Natural Capital    |    Case Study A Chain is as Strong as its Weakest Link The complex nature of our business, a dynamic business environment and growing stakeholder expectations – make our pursuit of excellence, an evolving endeavour. Thus we are constantly upgrading benchmarks, enhancing processes and refining our systems. But we realise that a chain is only as strong as its weakest link and therefore, with the same zeal, we share the know-how with our various partners. Different engagement and capability building platforms have been designed to embed sustainability in the supply chain and thereby, raise the performance collectively. Over and above enhanced sustainability performance, this collective knowledge boost is enabling standardisation of benchmarks across the chain, higher business efficiency, faster delivery and most important of all, enduring partnerships. Below is a glimpse of our new and ongoing platforms that ensure intensive engagement with the supply chain.   Vendor Induction All new vendors undergo a mandatory induction to enhance familiarity with our business processes and culture. The induction training comprises key sustainability parameters like environment, health & safety, ethical trading and human rights.   Supplier Training Sessions A widely adopted knowledge sharing mechanism; during the reporting period, 280 man-hours were invested in conducting supplier training. Training areas included safety, quality, regulatory landscape and sourcing levers. Our SCM professionals were also trained and rated across three competency levels – silver, gold and platinum.       Troubleshooting Labs for Vendors Also called the Use Test Lab, its core goal is to help lessen the probability of sudden discrepancies at the time of commercial scale production. Performance Measurement A supplier score card was introduced in the reporting period, to enable supplier rating based on various parameters like price, delivery, quality and D&B Supplier Evaluation Risk Rating. The aim of this one-of-a-kind score card is to rate suppliers more objectively, identify specific interventions for improving their score as well as institute a risk & reward mechanism to encourage high performance. Vendor Risk Assessment We periodically analyse vendor risks pertaining to key aspects such as quality, capacity, finance, environment, health & safety and social responsibility. In the reporting year, we reconducted the D&B Risk Assessment exercise for our top Indian vendors with an aim to anticipate and alleviate risks. Global Business Partners Summit A total of 350 strategic business partners from 5 countries attended the event, where we shared our key business priorities and expectations from vendors on quality, regulatory preparedness, delivery and code of conduct. We also hosted the Annual Business Partners Conference wherein, we recognised high performing vendors.     Vendor Support Lab A dedicated lab to analyse samples as well as extend support in areas of cut-off studies, analytical method validations and method development for few critical molecules. LAZORR: Collaborative Engagement Dr. Reddy's is a member of LAZORR, a-first-in-India alliance of the country's six major pharmaceutical companies, which has been formed to share best practices in core areas including procurement, solvents, energy, safety and water. Dr. Reddy's leads the packaging workstream, sharing insights and possibilities of interventions to optimise packaging.     Safety and Quality Safety and quality gap analysis has been initiated for suppliers to identify shortcomings and prescribe corrective measures. We continue to conduct Quest Meets, a biannual programme to ensure quality compliance among suppliers.   Vendor Audits Year-on-year, we conduct vendor audits to ensure robustness of our supply chain. In FY14, 82 vendor audits were conducted wherein, 628 observations were raised including 6 critical observations and 89 major observations. Based on this analysis, 2 vendors were blocked. In FY15, 95 vendor audits were conducted wherein, 627 audit observations were raised including 33 critical observations and 173 major observations. 9 vendors were blocked based on these audits.