Description
Study of Operations TEKNIC in manufacturing company
OPERATIONS MANAGEMENT
Group Project : TEKNIC Electromeconics Pvt. Ltd.
By: Vishwanath S.D Roll No : (USLU/MBA/I/JUL12/11881)
TABLE OF CONTENTS
i. ii. iii. iv. v. vi. vii. viii. ix. x. xi. xii.
Acknowledgement: ............................................................. 3 Introduction/Background of the project: ............................ 4 Objectives of the study: ...................................................... 6 Processes involved in the switch manufacturing: ................ 7 Detail phases of production: ............................................. 10 Bottlenecks/ Problem areas identified .............................. 11 Solutions to work on: ....................................................... 13 Quality tool to decide factors ............................................ 14 Major reason for unsatisfactory quality: ........................... 15 Steps taken to improve quality of the Switches ................. 15 Effect of quality management on productivity: .................. 19 Conclusion: ...................................................................... 21
Page 2 of 21
Acknowledgement:
This project has been an opportunity for all of us to gain a hands?on experience on a live project. First of all we would like to thank Mr. Shyam Jaising, MD, TEKNIC Electromeconics Pvt. Ltd. to show trust in the students of JARO education and entrusting us with the responsibility to study & improve the operations of their company. We would like to convey our heartfelt thanks to Ulyanovsk State University Russia to give us the opportunity to take up this project. Its study materials have been the only source of guidance for me throughout.
Page 3 of 21
Introduction/Background of the project:
In any organization Operation is the most basic function, be it manufacturing or service. In fact, one cannot imagine an organization without an operation function. As a study project our objective is to apply the concepts & techniques learned in the class to real life problems in the industry. We have selected local switch manufacturing company for this particular project. The rationale behind selecting the industry is significance of the operations management as an effective strategic tool for this particular industry. The company operates is a monopolistically competitive market. There are many planning & control issues in operations which plays important role in deciding overall competitiveness of the final product in the market. Operations Management holds the key to competitive advantage for such organizations. Unorganized nature of processes & demands create many challenges in terms of operations management. We intend to tackle the specific problems related to quality & pricing of the product which are the driving factor for the competitiveness in the particular market.
Page 4 of 21
About the Company:
Company selected for the project work is “Teknic Electromeconics Pvt. Ltd.”. Company is in its nascent stage of growth with a capital investment of Rs. 7 million.The firm is a Light Duty Switches manufacturing company based out of Bangalore. The firm produces around 50 types of products: Rocker switches, Circuit breakers, and Home appliance switches etc. It plans to develop more types of switches in the coming years. TEKNIC’s design lab has the latest CAD / CAM software to enhance design techniques in designing products and tools. With the help of Software, Design analysis can be done even before manufacturing, to reduce lead times and introduce products in the market in record times. In house tool rooms have modern machines for manufacturing tools for captive consumption. All plastic components are moulded within TEKNIC companies and to do that we have Injection moulding machines ranging upto 200 Tones Thermo Plastic / Thermo set moulding machinery from 30 Tones to 200 Tones. TEKNIC are proud that the relationship built up with their Suppliers or ancillary partners having an association with their since the establishment of the company. Two of TEKNIC group companies, Teknic Electromeconics Pvt. Ltd., & Teknic Euchner Electronics Pvt. Ltd., manufacturing appliance switches & precision switches respectively have successfully achieved the ISO 9001 certificate. The other group companies will follow. With the constant stringent quality demands by national & international customers, the products have been tested and certified for UL, CSA, STQC, ENEC and VDE approvals.
Page 5 of 21
In a diverse country like India, TEKNIC products and services have reached all corners either personally or through their dealer network. They also have their own offices in Banglore, Mumbai, Chennai, Kolkatta, Pune, New Delhi, Ludhiana, Ahmedabad and Vapi. Automation is being introduced to improve efficiency & consistency. By maintaining small sized manufacturing units, the company is lean & flexible and has a constant focus on goals
Objectives of the study:
1. To study the processes involved in switch manufacturing firm. 2. To find out the bottlenecks/ problem areas in the processes. 3. To narrow down the areas to work on for the overall improvement of the process. 4. To suggest the improvement plan in the processes: which might help the firm to gain competitive advantage in the market.
Page 6 of 21
Scope of the study:
Scope of this project includes the understanding of the basic processes involved in the switch manufacturing. It also includes finding out the bottlenecks or problem areas in the process & providing workable solution for the overall improvement of the operation processes involved.
Processes involved in the switch manufacturing:
1. Raw Material Purchase
All the raw material viz. copper reels, fasteners, Plastic raw material, Tool room Metals, Consumables, Bimetals etc are purchased before the start of the production process. Most of the purchases are from the local and overseas manufacturers.
Page 7 of 21
2. Hire Contract Labourers
Labors are hired for many processes viz. mechanical fitters, Welding, Assembly, testing and packing. The hired labor charges at per day rate. The working hours per day are 8 hours. And number of labors calculated as per the man hour demand calculation.Due to high demand fluctuation; Labourers are hired on daily/ monthly wage basis for short durations. Firm has requirement of the both skilled & non skilled labourers. And there are minimum permanent labours as well. Labours are selected on below job description: 1. Read technical drawings 2. Ability to work continuously 3. Troble shooting in case of wrong work. 4. Skill level on the job 5. Approach towards senior employees/workers. 6. General behaviour. 7. Inter personnel skills. 8.Any advantageous skills that may benefit organisation.
Page 8 of 21
3. Production Process
Production process for manufacturing switches involves below steps. 1. Tooling for In-house components manufacturing. 2. In-house components manufacturing. 3. Outsourced components manufacturing. 4. Quality testing for in-house and outsourced components. 5. Welding of contacts 6. Rivetting 7. Component assembly into housings. 8. Ultra-sonic welding for closure of housings or enclosure.(Plastics) 9. Testing and Packing 10. Delivery The detailed production process is given below
Page 9 of 21
Detail phases of production (Supply chain):
1. Preparing Specifications of switch as per customer requirement. The 2. Quote preparation of the switch and customer approval /negotiation. 3. Release of first revision of drawings for both in-house and outsourced components of proto sample. 4. Tooling design and manufacturing. 5. Component manufacturing. 6. Component validation 7. Proto preparation 8. Testing of switch and submission to customer. 9. Approval and modification and finalisation of switch design. 10. Final revision drawings release for components and tooling. 11. Material procurement. 12. Component manufacturing 13. Component Validation. 14. Welding of contacts 15. Riveting 16. Component assembly into housings. 17. Ultra-sonic welding for closure of housings or enclosure.(Plastics) 18. Testing and Packing 19. Delivery
Page 10 of 21
Bottlenecks/ Problem areas identified
1. Availability of skilled labourers:
Assembly in the production process is semi automatic. Welding of copper contacts takes places automatically but machine setting needs to be refreshed each hour which is manual. Skilled labourers required for this are not easily available in the market.
2. Quality of Rivets:
Rivets are brought out parts and needs proper coating of nickel which decides the life of switch. Hence it is very natural that there is large variation in the quality of the Rivets obtained from the local vendors.
3. Price flexibility of Copper:
Prices of the copper material vary to large degree depending on the market. As Copper is most extensively used raw material, it has major effect on the final cost of the product. Local switch market in India is monopolistically competitive market. There are few major players which covers the most of the market share. TEKNIC is a start up venture hence cost & quality are important drivers in the competition.
Page 11 of 21
4. Wear & tear of tooling the quality of final product:
We found that one of the important reasons for the poor quality of switch is the quality of die or plastic mould. Mould undergoes wear & tears with time affecting final quality.
5. Availability of electricity supply:
Electricity supply is one of the key requirements for the production process. Continuous supply of electricity is main problem. The company has installed a generator to counter this particular problem. The generator installed is capable of supporting one machine only. However, if the load of both the machines is shifted on the same, the moulding and welding process takes a hit and in turn the quality of the sole thus produced suffers.
Page 12 of 21
Solutions to work on:
1. Further study intends to work on the improving overall quality of the switch produced. This will create competitive advantage in long term for TEKNIC.
2. The firm is price taker mainly because of the competitive nature of the industry. As Price cannot be changed much our focus is on increasing production efficiency to reduce overall cost of the processes.
3. This study also aim to provide the calculations to measure the overall changes in terms of cost & quality which will be benefited from the new processes suggested.
4. To create & study the production chart of the company.
Page 13 of 21
Quality tool to decide factors
Pareto Analysis:
Cause Raw material Generator Defective Die Misalignment Transportation
No. Of defects 84 59 15 10 8 176
Percentage 48 34 9 6 5 100
Page 14 of 21
50 45 40 35 30 25 20 15 10 5 0 Series1
Major reason for unsatisfactory quality:
1. Quality of raw material. 2. Products manufactured using the generator. 3. Misalignment of die. 4. Product produced with a die which have undergone wear & tear.
Steps taken to improve quality of the Switches
1. Quality of scrap:
Page 15 of 21
Quality of scrap is one of the reasons for poor quality of switch. To improve the quality we suggest a lab test to be performed on COPPER material taken from market this test will reduce the chances of defective raw material by 80 to 90%.
2. Quality of die:
It usually takes 6 months for die to wear. Hence checking of die after every month after first 3 month of die is completed for replacement is must. This will take care of bulk lesser quality products because of die wear & tear.
3. Inferior quality due to generator usage:
Production schedule is revised & attempt is made to reduce the machine usage on generator.
Page 16 of 21
Timing 7 -8 am 8 - 9 am 9 - 10 am 10 - 11 am 11 - 12 am 12 - 1 pm 1 - 2 pm 2 - 3 pm 3 - 4 pm 4 - 5 pm 5 - 6 pm 6 - 7 pm 7 - 8 pm 8 - 9 pm 9 - 10 pm Break
Monday
Tuesday
Wedenesday
Thursday
Saturday
Sunday
(12-1pm) (6-7 pm) (12-1pm) (6-7 pm) (11-12pm) (4-5 pm) (11-12pm) (4-5 pm) (12-1pm) (5-6 pm) (12-1pm) (5-6 pm)
Total Generator hours in a week = 37 Total Hours saved = 8 Defects under generator usage = 59 Forecasted defects = 46
4. Misalignment of Die
One of the main reasons for defective quality of switch is misalignment of die for welding. To solve this problem we are proposing a fixture which
Page 17 of 21
will resolve this problem. Though it will involve some initial investment it will help in resolving quality issues in long term.
Page 18 of 21
Effect of quality management on productivity:
1. Productivity & Yield
Input
Output
Productivity
Yield
1180 1070
1000 1000
84.75 93.46
1000.05 1102.83
? ?
Productivity increased from 84.75% to 93.5%. Yield increased from 1000 to 1103.
2. Product Cost
Page 19 of 21
Rocker Switch Current Kd I Yield Product Cost 41 1176 1011 48 Forecasted 41 1067 1105 40
Circuit Breaker Current 52 1176 1011 61 Forecasted 52 1128 1105 54
Kd :- Direct manufacturing cost per unit I :- Input units
? ?
Product Cost for Rocker switch has improved from 48 to 40 Product Cost for circuit breaker has improved from 61 to 54.
3. Forecasted Percentage of defective pieces
Cause
No. Of defects
Percentage
Forecasted defects
Percentage
Raw material Generator Defective Die Misalignment Transportatio n
84 59 15 10 8 176
48 34 9 6 5 100
12 47 0 0 8 67
7 27 0 0 5 39
? ?
Significant reduction in percentage of defective pieces after the application of suggested quality measures. Percentage change is almost equal to 60%.
Page 20 of 21
4. Quality Productivity Ratio
Kd
I
O/P
QPR
Rocker switch Circuit breaker
41 41 52 52
1176 1067 1176 1067
1000 1000 1000 1000
2.08 2.29 1.64 1.81
? ?
QPR for the Rocker switch increased from 2.08 to 2.29. QPR for the Circuit breaker increased from 1.64 to 1.81
Conclusion:
All the suggested quality measures if implemented will help the firm to achieve the objective of producing better quality switches at low cost. Even if purchasing a fixture is a costly affair & firm cannot take up that in its infancy period it is definitely a measure to be taken up some year down the line. All other measures are effective & almost cost nothing. We hope TEKNIC benefits from our study.
Page 21 of 21
doc_699895665.pdf
Study of Operations TEKNIC in manufacturing company
OPERATIONS MANAGEMENT
Group Project : TEKNIC Electromeconics Pvt. Ltd.
By: Vishwanath S.D Roll No : (USLU/MBA/I/JUL12/11881)
TABLE OF CONTENTS
i. ii. iii. iv. v. vi. vii. viii. ix. x. xi. xii.
Acknowledgement: ............................................................. 3 Introduction/Background of the project: ............................ 4 Objectives of the study: ...................................................... 6 Processes involved in the switch manufacturing: ................ 7 Detail phases of production: ............................................. 10 Bottlenecks/ Problem areas identified .............................. 11 Solutions to work on: ....................................................... 13 Quality tool to decide factors ............................................ 14 Major reason for unsatisfactory quality: ........................... 15 Steps taken to improve quality of the Switches ................. 15 Effect of quality management on productivity: .................. 19 Conclusion: ...................................................................... 21
Page 2 of 21
Acknowledgement:
This project has been an opportunity for all of us to gain a hands?on experience on a live project. First of all we would like to thank Mr. Shyam Jaising, MD, TEKNIC Electromeconics Pvt. Ltd. to show trust in the students of JARO education and entrusting us with the responsibility to study & improve the operations of their company. We would like to convey our heartfelt thanks to Ulyanovsk State University Russia to give us the opportunity to take up this project. Its study materials have been the only source of guidance for me throughout.
Page 3 of 21
Introduction/Background of the project:
In any organization Operation is the most basic function, be it manufacturing or service. In fact, one cannot imagine an organization without an operation function. As a study project our objective is to apply the concepts & techniques learned in the class to real life problems in the industry. We have selected local switch manufacturing company for this particular project. The rationale behind selecting the industry is significance of the operations management as an effective strategic tool for this particular industry. The company operates is a monopolistically competitive market. There are many planning & control issues in operations which plays important role in deciding overall competitiveness of the final product in the market. Operations Management holds the key to competitive advantage for such organizations. Unorganized nature of processes & demands create many challenges in terms of operations management. We intend to tackle the specific problems related to quality & pricing of the product which are the driving factor for the competitiveness in the particular market.
Page 4 of 21
About the Company:
Company selected for the project work is “Teknic Electromeconics Pvt. Ltd.”. Company is in its nascent stage of growth with a capital investment of Rs. 7 million.The firm is a Light Duty Switches manufacturing company based out of Bangalore. The firm produces around 50 types of products: Rocker switches, Circuit breakers, and Home appliance switches etc. It plans to develop more types of switches in the coming years. TEKNIC’s design lab has the latest CAD / CAM software to enhance design techniques in designing products and tools. With the help of Software, Design analysis can be done even before manufacturing, to reduce lead times and introduce products in the market in record times. In house tool rooms have modern machines for manufacturing tools for captive consumption. All plastic components are moulded within TEKNIC companies and to do that we have Injection moulding machines ranging upto 200 Tones Thermo Plastic / Thermo set moulding machinery from 30 Tones to 200 Tones. TEKNIC are proud that the relationship built up with their Suppliers or ancillary partners having an association with their since the establishment of the company. Two of TEKNIC group companies, Teknic Electromeconics Pvt. Ltd., & Teknic Euchner Electronics Pvt. Ltd., manufacturing appliance switches & precision switches respectively have successfully achieved the ISO 9001 certificate. The other group companies will follow. With the constant stringent quality demands by national & international customers, the products have been tested and certified for UL, CSA, STQC, ENEC and VDE approvals.
Page 5 of 21
In a diverse country like India, TEKNIC products and services have reached all corners either personally or through their dealer network. They also have their own offices in Banglore, Mumbai, Chennai, Kolkatta, Pune, New Delhi, Ludhiana, Ahmedabad and Vapi. Automation is being introduced to improve efficiency & consistency. By maintaining small sized manufacturing units, the company is lean & flexible and has a constant focus on goals
Objectives of the study:
1. To study the processes involved in switch manufacturing firm. 2. To find out the bottlenecks/ problem areas in the processes. 3. To narrow down the areas to work on for the overall improvement of the process. 4. To suggest the improvement plan in the processes: which might help the firm to gain competitive advantage in the market.
Page 6 of 21
Scope of the study:
Scope of this project includes the understanding of the basic processes involved in the switch manufacturing. It also includes finding out the bottlenecks or problem areas in the process & providing workable solution for the overall improvement of the operation processes involved.
Processes involved in the switch manufacturing:
1. Raw Material Purchase
All the raw material viz. copper reels, fasteners, Plastic raw material, Tool room Metals, Consumables, Bimetals etc are purchased before the start of the production process. Most of the purchases are from the local and overseas manufacturers.
Page 7 of 21
2. Hire Contract Labourers
Labors are hired for many processes viz. mechanical fitters, Welding, Assembly, testing and packing. The hired labor charges at per day rate. The working hours per day are 8 hours. And number of labors calculated as per the man hour demand calculation.Due to high demand fluctuation; Labourers are hired on daily/ monthly wage basis for short durations. Firm has requirement of the both skilled & non skilled labourers. And there are minimum permanent labours as well. Labours are selected on below job description: 1. Read technical drawings 2. Ability to work continuously 3. Troble shooting in case of wrong work. 4. Skill level on the job 5. Approach towards senior employees/workers. 6. General behaviour. 7. Inter personnel skills. 8.Any advantageous skills that may benefit organisation.
Page 8 of 21
3. Production Process
Production process for manufacturing switches involves below steps. 1. Tooling for In-house components manufacturing. 2. In-house components manufacturing. 3. Outsourced components manufacturing. 4. Quality testing for in-house and outsourced components. 5. Welding of contacts 6. Rivetting 7. Component assembly into housings. 8. Ultra-sonic welding for closure of housings or enclosure.(Plastics) 9. Testing and Packing 10. Delivery The detailed production process is given below
Page 9 of 21
Detail phases of production (Supply chain):
1. Preparing Specifications of switch as per customer requirement. The 2. Quote preparation of the switch and customer approval /negotiation. 3. Release of first revision of drawings for both in-house and outsourced components of proto sample. 4. Tooling design and manufacturing. 5. Component manufacturing. 6. Component validation 7. Proto preparation 8. Testing of switch and submission to customer. 9. Approval and modification and finalisation of switch design. 10. Final revision drawings release for components and tooling. 11. Material procurement. 12. Component manufacturing 13. Component Validation. 14. Welding of contacts 15. Riveting 16. Component assembly into housings. 17. Ultra-sonic welding for closure of housings or enclosure.(Plastics) 18. Testing and Packing 19. Delivery
Page 10 of 21
Bottlenecks/ Problem areas identified
1. Availability of skilled labourers:
Assembly in the production process is semi automatic. Welding of copper contacts takes places automatically but machine setting needs to be refreshed each hour which is manual. Skilled labourers required for this are not easily available in the market.
2. Quality of Rivets:
Rivets are brought out parts and needs proper coating of nickel which decides the life of switch. Hence it is very natural that there is large variation in the quality of the Rivets obtained from the local vendors.
3. Price flexibility of Copper:
Prices of the copper material vary to large degree depending on the market. As Copper is most extensively used raw material, it has major effect on the final cost of the product. Local switch market in India is monopolistically competitive market. There are few major players which covers the most of the market share. TEKNIC is a start up venture hence cost & quality are important drivers in the competition.
Page 11 of 21
4. Wear & tear of tooling the quality of final product:
We found that one of the important reasons for the poor quality of switch is the quality of die or plastic mould. Mould undergoes wear & tears with time affecting final quality.
5. Availability of electricity supply:
Electricity supply is one of the key requirements for the production process. Continuous supply of electricity is main problem. The company has installed a generator to counter this particular problem. The generator installed is capable of supporting one machine only. However, if the load of both the machines is shifted on the same, the moulding and welding process takes a hit and in turn the quality of the sole thus produced suffers.
Page 12 of 21
Solutions to work on:
1. Further study intends to work on the improving overall quality of the switch produced. This will create competitive advantage in long term for TEKNIC.
2. The firm is price taker mainly because of the competitive nature of the industry. As Price cannot be changed much our focus is on increasing production efficiency to reduce overall cost of the processes.
3. This study also aim to provide the calculations to measure the overall changes in terms of cost & quality which will be benefited from the new processes suggested.
4. To create & study the production chart of the company.
Page 13 of 21
Quality tool to decide factors
Pareto Analysis:
Cause Raw material Generator Defective Die Misalignment Transportation
No. Of defects 84 59 15 10 8 176
Percentage 48 34 9 6 5 100
Page 14 of 21
50 45 40 35 30 25 20 15 10 5 0 Series1
Major reason for unsatisfactory quality:
1. Quality of raw material. 2. Products manufactured using the generator. 3. Misalignment of die. 4. Product produced with a die which have undergone wear & tear.
Steps taken to improve quality of the Switches
1. Quality of scrap:
Page 15 of 21
Quality of scrap is one of the reasons for poor quality of switch. To improve the quality we suggest a lab test to be performed on COPPER material taken from market this test will reduce the chances of defective raw material by 80 to 90%.
2. Quality of die:
It usually takes 6 months for die to wear. Hence checking of die after every month after first 3 month of die is completed for replacement is must. This will take care of bulk lesser quality products because of die wear & tear.
3. Inferior quality due to generator usage:
Production schedule is revised & attempt is made to reduce the machine usage on generator.
Page 16 of 21
Timing 7 -8 am 8 - 9 am 9 - 10 am 10 - 11 am 11 - 12 am 12 - 1 pm 1 - 2 pm 2 - 3 pm 3 - 4 pm 4 - 5 pm 5 - 6 pm 6 - 7 pm 7 - 8 pm 8 - 9 pm 9 - 10 pm Break
Monday
Tuesday
Wedenesday
Thursday
Saturday
Sunday
(12-1pm) (6-7 pm) (12-1pm) (6-7 pm) (11-12pm) (4-5 pm) (11-12pm) (4-5 pm) (12-1pm) (5-6 pm) (12-1pm) (5-6 pm)
Total Generator hours in a week = 37 Total Hours saved = 8 Defects under generator usage = 59 Forecasted defects = 46
4. Misalignment of Die
One of the main reasons for defective quality of switch is misalignment of die for welding. To solve this problem we are proposing a fixture which
Page 17 of 21
will resolve this problem. Though it will involve some initial investment it will help in resolving quality issues in long term.
Page 18 of 21
Effect of quality management on productivity:
1. Productivity & Yield
Input
Output
Productivity
Yield
1180 1070
1000 1000
84.75 93.46
1000.05 1102.83
? ?
Productivity increased from 84.75% to 93.5%. Yield increased from 1000 to 1103.
2. Product Cost
Page 19 of 21
Rocker Switch Current Kd I Yield Product Cost 41 1176 1011 48 Forecasted 41 1067 1105 40
Circuit Breaker Current 52 1176 1011 61 Forecasted 52 1128 1105 54
Kd :- Direct manufacturing cost per unit I :- Input units
? ?
Product Cost for Rocker switch has improved from 48 to 40 Product Cost for circuit breaker has improved from 61 to 54.
3. Forecasted Percentage of defective pieces
Cause
No. Of defects
Percentage
Forecasted defects
Percentage
Raw material Generator Defective Die Misalignment Transportatio n
84 59 15 10 8 176
48 34 9 6 5 100
12 47 0 0 8 67
7 27 0 0 5 39
? ?
Significant reduction in percentage of defective pieces after the application of suggested quality measures. Percentage change is almost equal to 60%.
Page 20 of 21
4. Quality Productivity Ratio
Kd
I
O/P
QPR
Rocker switch Circuit breaker
41 41 52 52
1176 1067 1176 1067
1000 1000 1000 1000
2.08 2.29 1.64 1.81
? ?
QPR for the Rocker switch increased from 2.08 to 2.29. QPR for the Circuit breaker increased from 1.64 to 1.81
Conclusion:
All the suggested quality measures if implemented will help the firm to achieve the objective of producing better quality switches at low cost. Even if purchasing a fixture is a costly affair & firm cannot take up that in its infancy period it is definitely a measure to be taken up some year down the line. All other measures are effective & almost cost nothing. We hope TEKNIC benefits from our study.
Page 21 of 21
doc_699895665.pdf