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RECOMMENDED READING PRODUCTIVITTY TECHNIQUES BY DR

UDAY SALUNKE

PRODUCTIVITY TECHNIQUES BY P SSHIRKE

HANDBOOK OF INDUSTRIAL

ENGINEERING AND MANAGEMENT BY

IVERSON AND GRANT

ILO WORK STUDY HANDBOOK

TOTAL PRODUCTIVITY MANAGEMENT BY

DAVID SUMANTH


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PRODUCTIVITYTECHNIQUES


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RESOURCES OF AN

ORGANIZATION Whether Public or Private;The resourcesresources

that are available to them are:

Land & Buildings

Materials

Plant, Machines & Equipment

Energy

People

Money


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INTRODUCTION TO

PRODUCTIVITY PRODUCTIVITY IS RATIO OF GOODS AND

SERVICES PRODUCED TO RESOURCES USED OR

RATIO OF OUTPUT TO INPUT INCREASED PRODUCTIVITY IS AN OUTCOME OF

INCESSANT WAR AGAINST WASTE ; HENCE

PRODUCTIVITY CAN BE DEFINED AS AN

ATTEMPT TO MINIMIZE WASTE

PRODUCTIVITY CAN BE INCREASED BY

MINIMIZING USE OF MATERIAL, REDUCED TIME

TO DO JOB, etc


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EXAMPLES OF OUTPUT

Whether the organization is public or

private the outputs are ;

Accomplishment of a taskAccomplishment of a task

Length of an outputLength of an output

Distance travelledDistance travelled

Number of pieces producedNumber of pieces produced

Weight of productionWeight of production


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EXAMPLES OF

OUTPUT(Contd.)

Volume of outputVolume of output

Value of outputValue of output

No. of documents processedNo. of documents processed

Time taken to carry out a jobTime taken to carry out a job No of jobs attendedNo of jobs attended

No. of customers servedNo. of customers served


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EXAMPLES OF INPUTEXAMPLES OF INPUT

Labour force or man hours, man days. Etc..

Labour cost (Rs)

Area of land(in hectares)

Kg. Of material or material cost in Rs.

Volume of material or fluid

Length of material square area of space

Units of power

Time etc.


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MEANING OF PRODUCTIVITY PRODUCTIVITY IS OFTEN ASSOCIATED WITH

PRODUCTION

HIGHER PRODUCTION IS NOT HIGHER

PRODUCTIVITY INCREASE IN PRODUCTION CAN BE ACHIEVED

BY INCREASING QUANTUM OF INPUT BUT THATDOES NOT INCREASE PRODUCTIVITY

HIGHER PRODUCTIVITY RESULTS IF

PRODUCTION PER EMPLOYEE OR PER MACHINEINCREASES ALONGSIDE WITH QUALITY

PRODUCTIVITY IS CREATING SURPLUS THRUPRODUCTIVE OPERATIONS WHERE OUTPUT ISALWAYS GT INPUT

PRODUCTIVITY IS DEFINED AS OUTPUT WITHINDEFINED TIME AND AS PER QLTY NORMS/INPUT


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MEANING OF PRODUCTIVITY BOTH OUTPUT AND INPUT SHOULD BE

QUANTIFIED IN TANGIBLE MONETARYTERMS

PRODUCTIVITY CAN BE IMPROVED BY-INCREASING OUTPUT WITH SAME INPUT-INCREASING OUTPUT MORE THAN THEINCREASE IN INPUT

-DECREASING INPUT FOR THE SAMEAMOUNT OF OUTPUT-INCREASING OUTPUT WHILEDECREASING INPUT

PRODUCTIVITY IMPLIES EFFECTIVENESS

AND EFFICIENCY IN INDIVIDUAL AND


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DEFINITION OF

PRODUCTIVITY PRODUCTIVITY IS THE RATIO BETWEEN OUTPUT

OF WEALTH TO THE INPUT OF RESOURCES USED

IN THE PROCESS OF MFG PRODUCTIVITY = OUTPUT OF WEALTH/INPUT OF

RESOURCES

INPUTS ARE MATERIAL , MONEY , MACHINES ,

PEOPLE

ANOTHER PARAMETER OFTEN USED IS

PERFORMANCE WHICH IS (ACTUAL

ACHIEVEMENT IN TERMS OF EFFECTIVE WORK

DONE)/(STANDARD TARGET OF ACHIEVEMENT) *

100


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DEFINITION OF

PRODUCTIVITY PERFORMANCE IS EXPRESSED AS PERFORMANCE INDEX

WHICH IS % OF STANDARD TARGET OR EFFECTIVENESS OF

PRODUCTIVITY .PRODUCTIVITY = OUTPUT/INPUT

= PERFORMANCE ACHIEVED/RESOURCES CONSUMED= EFFECTIVENESS/EFFICIENCY

PRODUCTIVITY CAN BE APPLIED TO MATERIAL ,

EQUIPMENT,MEN,CAPITAL

MATRL = 1 TONNE OF HOT ROLLED STEEL PRODUCES 0.8

TONNE OF COLD ROLLED STEEL REST IS SCRAP.PRODUCTIVITY WAS 80%. THE ENGINEERS AT TISCO

STUDIED THE PROCESS AND THRU METHOD STUDY

INCREASED PRODUCTIVITY TO 90% BY REDUCING SCRAP


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DEFINITION OF

PRODUCTIVITY MACHINE = RATED THROUGHPUT OF POWER

PLANT WAS 100 MWH. ACTUAL

THROUGHPUT(PLF) WAS 72% WHICH MEANT THEPOWER PLANT HAD 28% LOSSES.AFTER

STUDYING HEAT LOSSES AND INSTALLING

PREHEATERS AND REGENERATORS THE HEAT

LOSS WAS REDUCED BY 8%.HENCE

PRODUCTIVITY OF POWER PLANT ROSE TO 80% MAN = STANDARD OUTPUT OF TRAINED 1 YEAR

EXPERIENCED ORACLE PROGRAMMER IS 80

DEBUGGED LINES OF CODE PER DAY. ON A

PARTICULAR DAY MR X PRODUCED 60 LINES. HISPRODUCTIVITY WAS 75%


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MISCONCEPTIONS ABOUT

PRODUCTIVITY People fear, hate, feel let down, complain

about productivity, very often because

they have misunderstood it.

There are several misconceptionsmisconceptions

about

ProductivityProductivity


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MISCONCEPTIONMISCONCEPTION -- II

Productivity = ProductionProductivity = Production

Productivity is merely a moresophisticated word forproduction


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MISCONCEPTIONMISCONCEPTION -- IIII

Productivity meansProductivity means

onlyonly

Labour ProductivityLabour Productivity


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MISCONCEPTIONMISCONCEPTION --44

Higher productivity causes

retrenchment and large scale loss of jobs

This may happen in the short term but thelong term benefits outweigh this

disadvantage


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MISCONCEPTIONMISCONCEPTION -- 55

Productivity is relevantonly in manufacturing

and

not relevant elsewhere


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Productivity can be

increased by cutting costs

across the board


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Productivity andProductivity andQuality are trade offs.Quality are trade offs.

You cannot increase oneYou cannot increase one

without affecting the otherwithout affecting the other


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Productivity is directly

related to profits. In other

words a profitable

organization is always aproductive one


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Productivity is relevant

only in an open economy


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Productivity is only for

commercial enterprises

and not for the

public sector


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Productivity is for

organizations and not for

you and me


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SO DO NOT GET MISLED

BY THESE

MISCONCEPTIONS


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OTHER THOUGHTS ONOTHER THOUGHTS ON

PRODUCTIVITYPRODUCTIVITY

Productivity is an attitude of mindProductivity is an attitude of mind

Productivity means doing something betterProductivity means doing something better

today than yesterdaytoday than yesterday

Productivity means continuousProductivity means continuous

improvementimprovement


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The quantitative aspects ofThe quantitative aspects of

productivityproductivity

By this is meant the concepts behindproductivity measurement and their

application to performance measurement at

the economy and company level


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PRODUCTIVITY LEVELSPRODUCTIVITY LEVELS

National ProductivityNational Productivity

Industry ProductivityIndustry Productivity

Company ProductivityCompany Productivity

Divisional ProductivityDivisional Productivity Branch ProductivityBranch Productivity

Individual ProductivityIndividual Productivity


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NATIONAL PRODUCTIVITYNATIONAL PRODUCTIVITY

= GDP

EMPLOYED WORK FORCE

This is a single factor productivity measureand therefore wrong inferences may be

made by comparing one country with

another


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ORGANIZATIONORGANIZATION

PRODUCTIVITYPRODUCTIVITY-- HOW TOHOW TOMEASURE ?MEASURE ?

The best methodbest method is to use

Added Value( as output) per single factor of

output

Added Value is Sales (Procured Material +

Outsourced services)

(Added value measures the wealth creation)


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EXAMPLES OF ADDED

VALUE

Added Value per employee

Added Value per Rs of labour cost

Added Value per Kg of material

Added Value per KWH of power Added Value per litre of fuel


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RESOURCES IN

PRODUCTIVITY MANPOWER SKILLS AND CAPABILITY

MACHINE

MATERIAL

MONEY

ENERGY

METHOD TIME

MANAGEMENT


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REASONS FOR

PRODUCTIVITY LOSS UNBALANCED WORK ROUTE

UNCLEAR INSTRUCTIONS

WAITING FOR RESOURCES

EXCESS REJECTS/REWORK

FREQUENT WORK INTERRUPTIONS

ADVERSE WORKING CONDITIONSLEADING TO EXCESS FATIGUE AND

HENCE UNDER PRODUCTIVITY EG 15 MIN

OVERS/HR IN CRIOCKET REGARDLESS OF

WEATHER


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PARTIAL PRODUCTIVITY DEFINED AS RATIO OF TOTAL OUTPUT TO ANY ONE TYPE

OF INPUT eg MATERIAL , MONEY ,LABOUR , ENERGY

LABOUR PRODUCTIVITY = TOTAL OUTPUT/LABOUR COST

eg 1000 cr/300cr = 3.3 MATERIAL PRODUCTIVITY =TOTAL OUTPUT/MATRL COST

eg 1000cr/200cr 5.0

CAPITAL PRODUCTIVITY = TOTAL OUTPUT/CAPITAL COST

eg 1000cr/800 = 1.25

CAN ALSO BE CALLED FIXED ASSET PRODUCTIVITY ENERGY PRODUCTIVITY =TOTAL OUTPUT/ENERGY COST

eg 1000cr/100cr = 10


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PARTIAL PRODUCTIVITY PARTIAL PRODUCTIVITY GIVES MEASURE OF

IMPACT OF TYPE OF INPUT ON OVERALL

PRODUCTIVITY

PARTIAL PRODUCTIVITY HELPS IN DETERMINING

IMPORTANCE OF TYPE OF INPUT ON

EFFECTIVENESS OF PROCESS


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ASSET ENERGY

SUSTAINABILITY INDEX MOST COMPANIES CONCENTRATE ON ACHIEVING A HIGH

DEGREE OF OVERALL EQUIPMENT EFFECTIVENESS

OEE = UPTIME * EFFICIENCY * QUALITY WHERE

EFFICIENCY IS THE THROUGHPUT PRODUCTIVITY BUT WHILE DOING SO HOW MUCH IS THE EXTRA ENERGY

CONSUMED

ARE WE ACHIEVING HIGHER THROUGHPUTS BUT

SACRIFICING ENERGY CONSUMPTION

ASSET ENERGY SUSTAINABILITY INDEX = OEE *(EXPECTED ENERGY CONSUMPTION PER UNIT

PRODUCED/ACTUAL ENERGY CONSUMED PERUNIT)


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COMPARITIVE PLANT FIGURES OF

ENERGY CONSUMPTION PER

VEHICLE IN HERO HONDA PLANTS2009 2010

PLANT VEH KWH/VEH VEH KWH/VEH

GURGAON 15.59L 35.85 15.93L 36.97

DHARUHERA 15.99L 31.12 15.33L 32.09

HARIDWAR 6.30L 24.63 14.04L 17.31

SOURCE ANNUAL REPORT OF HERO HONDA 2009-2010


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PARTIAL PRODUCTIVITY

ADVANTAGES EASY TO UNDERSTAND EFFECT OF

INDIVIDUAL FACTOR OF INPUT ON

OUTPUT EASY TO OBTAIN DATA

EASY TO COMPUTE PRODUCTIVITY

INDICES

EASY TO CONVINCE MGT OF BENEFITS

GOOD DIAGNOSTIC TOOLS AVAILABLE TO

PINPOINT AREAS OF PRODUCTIVITY

IMPROVEMENT


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PARTIAL PRODUCTIVITY

DISADVANTAGES IF USED ALONE CAN BE MISLEADING

STRESSES ON ONE FACTOR

CANNOT EXPLAIN OVERALL COSTINCREASES

TEND TO SHIFT BLAME ON WRONG AREAS

OF MGT CONTROL

IN THE CASE OF PARTIAL LABOR

PRODUCTIVITY THE CONTRIBUTION OF

INDIRECT LABOR IS NOT TAKEN INTO

CONSIDERATION


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PROBLEM WITH TRADITIONAL

LABOR PRODUCTIVITY OUTPUT PRODUCED IS A RESULT OF JOINT AND

SIMULTANEOUS IMPACT OF ALL RESOURCES

NOT ONLY LABOR

COMPANIES SHOWING HIGH LABOR

PRODUCTIVITY GROWTH RATES ARE NOT

ALWAYS COMPETITIVE IN THE MARKET

ORGANIZATIONS WITH COLLECTIVE

BARGAINING AGREEMENTS BASED ONLY ONLABOR PRODUCTIVITY TEND TO REDUCE THE

UNIT LABOR COST BUT NOT ALWAYS THE TOTAL

UNIT COST eg COMPUTERIZATION LEADING TO

LABOR REDUCTION


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PROBLEM WITH TRADITIONAL

LABOR PRODUCTIVITY DIFFICULT TO IMPLEMENT TEAM CONCEPTS OF

MGT WHEN PERFORMANCE MGT IS FOCUSED

ONLY ON LABOR PRODUCTIVITY RATHER THAN

TOTAL PRODUCTIVITY

ORG STRUCTURES TEND TO BE LESS FLEXIBLE

WHEN EMPHASIS IS ON CONTROL OF LABOR

PRODUCTIVITY RATHER THAN TOTAL

PRODUCTIVITY DIFFICULT TO DIRECTLY RELATE LABOR

PRODUCTIVITY TO PROFITS

IN MOST MFG OUTFITS LABOR COST IS NOT A

SIGNIFICANT COMPONENT OF DIRECT COSTS eg


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TOTAL FACTOR

PRODUCTIVITY DEFINED AS RATIO OF NET OUTPUT TO SUM OF

LABOUR AND CAPITAL INPUTS

NET OUTPUT = TOTAL OUTPUT INTERMEDIATEGOODS AND SERVICES PURCHASED

INTERMEDIATE GOODS AND SERVICES

PURCHASED INCLUDE RAW

MATRL,COMPONENTS,ENERGY COSTS,FUEL,FEES

FOR SERVICES etc

ALSO CALLED VALUE ADD WHEN COSTS

COMPUTED


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EXAMPLE OF TOTAL

FACTOR INDEX TOTAL FACTOR PRODUCTIVITY =

OUTPUT/CAPITAL + LABOUR INPUT =

100/(20 + 55) =100/75 = 1.33 VALUE ADD = SALES PROCURE PRICE

SERVICES PRICE = 2500 1000 500 = 1000

VALUE ADD PER EMPLOYEE = 1000/200 = 5


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ADVANTAGES OF TOTAL

FACTOR PRODUCTIVITY DATA IS EASY TO OBTAIN

APPEALING FROM ECONOMIST

POINT OF VIEW


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DISADVANTAGES OF TOTAL

FACTOR PRODUCTIVITY VALUE ADDED APPROACH TO DEFINING

OUTPUT IS NOT VERY APPROPRIATE

NOT APPROPRIATE WHEN MATRL COSTFORMS SIZEABLE PORTION OF TOTAL

PRODUCT COST

ONLY LABOR AND CAPITAL INPUTS ARE

CONSIDERED

DATA FOR COMPARISON PURPOSES IS

DIFFICULT TO OBTAIN


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TOTAL PRODUCTIVITY TOTAL PRODUCTIVITY IS THE RATIO OF TOTAL

OUTPUT TO THE SUM OF ALLINPUT FACTORS

MEASURE WHICH TAKES INTO CONSIDERATIONTHE JOINT IMPACT OF ALL INPUT RESOURCES ON

OUTPUT SUCH AS

MATERIAL,MACHINES,CAPITAL,ENERGY etc

MEASURE VERY POPULAR IN INDUSTRY


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ADVANTAGES OF TOTAL

PRODUCTIVITY CONSIDERS ALL QUANTIFIABLE OUTPUT AND INPUT FACTORS AND IS

THEREFORE A MORE ACCURATE REPRESENTATION OF THE REAL

ECONOMIC PICTURE OF THE COMPANY

PROFIT CONTROL THRU THE USE OF THESE INDICES IS OF BENEFIT TO THE

MGT IF USED IN CONJUNCTION WITH PARTIAL PRODUCTIVITY CAN DIRECT

MGT ATTENTION IN AN EFFECTIVE MANNER

SENSITIVITY ANALYSIS IS EASIER TO PERFORM

EASILY RELATED TO TOTAL COSTS

MULTIPLE GOALS CAN BE ACHIEVED SIMULTANEOUSLY BY INCREASING

TOTAL PRODUCTIVITY OF A COMPANY USING THE RELATIONSHIP BETWEEN PROFIT AND TOTAL PRODUCTIVITY

A FIRM CAN OBJECTIVELY PLAN ITS PROFIT LEVEL BASED ON ITS ABILITY

TO REACH A CERTAIN PRODUCTIVITY LEVEL

USING THE CONCEPT OF BREAK EVEN POINT OF TOTAL PRODUCTIVITY A

FIRM CAN DETERMINE IF ITS TOTAL PRODUCTIVITY LEVEL IS A VALUE

THAT YIELDS PROFITS

MGT IS FORCED INTO A LONG TERM ACTION ON QLTY,PROFITABILITY etc


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DISADVANTAGES OF TOTAL

PRODUCTIVITY DATA FOR COMPUTATION IS DIFFICULT TO

OBTAIN AT PRODUCT AND CUSTOMER LEVEL

LIKE THE PARTIAL AND TOTAL FACTOR

MEASURES THIS ALSO DOES NOT CONSIDER

INTANGIBLE FACTORS OF OUTPUT AND INPUT IN

A DIRECT MANNER


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AMERICAN PRODUCTIVITY

CENTRE MODEL MODEL DERIVES EQUATION OF PROFITABILITY WITH

PRODUCTIVITY AND PRICE RECOVERYFACTOR

PROFITABILITY = SALES/COST

= OUTPUT QTY * PRICE/INPUT QTY * UNIT COST=OUTPUT QTY/INPUT QTY *UNIT PRICE/UNIT COST

=PRODUCTIVITY * PRICE RECOVERY FACTOR

PRICE RECOVERY FACTOR INDICATES THE INFLATIONARY

EFFECT AND PRODUCTIVITY GIVES THE AMOUNT OF

RESOURCES CONSUMED TO PRODUCE THE DEFINEDOUTPUT. IT IS THE PRICE RATIO OF CURRENT PERIOD TO

THE BASE PERIOD


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APPLICATIONS OF

PRODUCTIVITY TECHNIQUES APPLIED TO ALL FUNCTIONAL AREAS BOTH IN

MFG AND SERVICES

CONCEPTS OF PRODUCTIVITY VITAL TO

SUCCESS AND SURVIVAL OF ORG IN TODAYS

HIGHLY COMPETITIVE GLOBAL BUSINESS

ENVIRONMENT

ONLY MEASUREMENT OF PRODUCTIVITY

INADEQUATE FOR COMPANY TO SURVIVE

CONTINUOUS IMPROVEMENT IN PRODUCTIVITY

IN ALL FUNCTIONAL AREAS AT A RATE FASTER

THAN COMPETITION IS A DECISIVE BUSINESS

FACTOR FOR SURVIVAL AND SUCCESS OF


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KEY PARAMETERS

MARKETING

ACCURACY OF DEMAND FORECASTING

-COST LEADERSHIP-SERVICING SPEED AND EFFECTIVENESS

-OPTIMISED PRODUCT MIX

PRODUCTION

-INVENTORY CONTROL-JUST IN TIME

-PROCUREMENT COST

-SAFETY


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AREAS OF PRODUCTIVITY

TECHNIQUES SUPPLY CHAIN MGT

DEMAND FORECASTING

COST MANAGEMENT LOGISTIC MGT

SERVICING SPEED AND EFFECTIVENESS

METHOD STUDY

PLANT LAYOUT MATERIAL HANDLING

INVENTORY CONTROL (INV TURNOVER RATIO)

WORK MEASUREMENT


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AREAS OF PRODUCTIVITY

TECHNIQUES MOTION STUDY

MATERIALS MGT AND CONTROL

ENERGY CONSUMPTION CONTROL

PRODUCTION PLANNING AND CONTROL

INVENTORY MODELS

ERGONOMICS SAFETY

JOB EVALUATION


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CAUSES OF POOR

PRODUCTIVITY LACK OF PRODUCTIVITY MEASURES BY WAY OF ABSENCE

OF A SYSTEM TO CAPTURE CORRECT AND TIMELY INPUTS

RELEVANT TO PRODUCTIVITY MEASUREMENTS

ESPECIALLY FOR ADMINISTRATIVE STAFF FAULTY APPRAISAL SYSTEM BASED ON QUALITATIVE

JUDGEMENTS

INADEQUATE WORK ASSIGNMENT

DEMOTIVATED OR UNDER CAPABLE EMPLOYEES

LOW EMPLOYEE INVOLVEMENT HUMAN CONFLICTS

LACK OF TRAINING AND SKILLS UPGRADES

TECHNOLOGICAL CHANGES ESPECIALLY FROM CLIENT

SERVER TO THIN CLIENT

UNBALANCED PRODUCTION LINE OR UNRELIABLE LINE


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MATERIAL BASED

PRODUCTIVITY TECHNIQUES INVENTORY CONTROL

SUPPLY CHAIN MGT

MATERIAL HANDLING QUALITY ASSURANCE

JUST IN TIME MFG AND PROCUREMENT


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PEOPLE BASED PRODUCTIVITY

TECHNIQUES INDIVIDUAL FINANCIAL INITIATIVES

GROUP FINANCIAL INITIATIVES

LIBERAL FRINGE BENEFITS EMPOWERMENT AND OWNERSHIP

TRAINING AND PERSONAL DEVELOPMENT

JOB ENRICHMENT AND ROTATION

EMPLOYEE PARTICIPATION IN MGT


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PRODUCT BASED

PRODUCTIVITY TECHNIQUES VALUE ENGINEERING

PRODUCT DIVERSIFICATION

PRODUCT SIMPLIFICATION PRODUCT FLEXIBILITY AND AGILITY

BENCHMARKING


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TASK BASED

PRODUCTIVITY

TECHNIQUES WORK MEASUREMENT INCLUDING

METHOD STUDY , TIME STUDY , MOTION

STUDY JOB DESIGN JOB EVALUATION AND JOB

SAFETY


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ILO APPROACH TO PRODUCTIVITY

IMPROVEMENT

ILO APPROACH IS TASK BASED

IT BREAKS MFG TIME INTO BASIC

WORK CONTENT ,ADDED WORK

CONTENT AND INEFFECTIVE TIME

APPROACH FOCUSES ON REDUCING

INEFFICIENT TIME IN THE TOTALWORK CONTENT


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INEFFECTIVE TIME

ALL INTERRUPTIONS WHICH CAUSE

STOPPAGE IN OPERATION IS REGARDED

AS INEFFICIENT TIME BECAUSE NO WORKEFFECTIVE TOWARDS COMPLETION OF

OPERATION IN HAND IS BEING DONE

DURING PERIOD OF INTERRUPTION

INEFFECTIVE TIME DUE TOSHORTCOMINGS BY MGT.TIME DURING

WHICH MAN/MC IS IDLE BECAUSE MGT

FAILED TO PLAN DIRECT OORDINATE OR

CONTROL EFFICIENTLY


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REDUCTION IN

INEFFECTIVE TIME INEFFECTIVE TIME WITHIN CONTROL OF WORKER CAN BE

REDUCED THRU ADOPTION OF FOLLOWING INITIATIVES

- POOR DESIGN AND FREQUENT DESIGN CHANGES

-WASTE OF MATERIAL-INCORRECT QUALITY STDS

-POOR LAYOUT AND UTILIZATION OF SPACE

-INADEQUATE MATEIAL HANDLING

-FREQUENT PRODUCTION STOPPAGES

-INEFFECTIVE WORK METHODS

-POOR WORK PLANNING-FREQUENT BREAKDOWNS

-ABSENTEEISM , WRONG ATTITUDES

-POOR WORKMANSHIP

-ACCIDENTS AND SAFETY ISSUES


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SURVEY RESULTS ON

PRODUCTIVITY TYPICAL 8 HR DAY

-3.5 HRS(44%) PRODUCTIVE TIME

-1.2 HRS(15%) UNAVOIDABLE DELAYS

-3.3 HRS(41%) WASTED TIME

REASONS FOR PRODUCTIVITY LOSS

-POOR PLANNING AND WORK SCHEDULING (35%)

-UNCLEAR INSTRUCTIONS TO EMPLOYEES(25%)

-INABILITY TO ADJUST STAFF SIZE AND DUTIESDURING PEAK LOADS(15%)eg BANK CASH

DISPENSING TELLERS

-POOR COORDINATION OF MATRL FLOW

,UNAVAILABILITY OF MACHINE(25%)


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COMMON MFG RATIOS

UNITS PRODUCED/LABOR HRS

REWORK HRS REQD/UNITS

PRODUCED

NUMBER DEFECTS/TOTAL UNITS

MACHINE UTILIZATION %

WT OF WASTE/WT OF FINISHED

GOODS

WT OF FINISHED GOODS/RM WEIGHT


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HARD METRICS IN

PRODUCTIVITY PLANT UTILIZATION

ENERGY EFFECTIVENESS INDEX

NUMBER OF ACCIDENTS AND HRS

LOST DUE TO ACCIDENTS

OVERALL PLANT EFFECTIVENESS

OVERALL PROCUREMENT

EFFECTIVENESS

OVERALL DISTRIBUTION

EFFECTIVESS


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SOFT METRICS IN

PRODUCTIVITY EMPLOYE MORALE

EMPLOYEE LOYALTY

EMPLOYEE INVOLVEMENT

JOB SATISFACTION

HONESTY


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SUMANTHS TOTAL

PRODUCTIVITY MODEL MODEL DEFINES TOTAL PRODUCTIVITY

MEASURE WHICH INCLUDES ALL THE OUTPUT

AND INPUT FACTORS

THE TPM IS BASED ON TANGIBLE OUTPUT AND

INPUT ELEMENTS WHICH ARE DIRECTLY

MEASUREABLE AND QUANTIFIABLE

MODEL ALSO REFLECTS THE IMPACT OF

INTANGIBLES DIRECTLY eg IF THE TOTALPRODUCTIVITY LEVEL GOES DOWN IN A PERIOD

IT COULD BE BECAUSE OF POOR QLTY OF RAW

MATRL WHICH INCREASE THE MATRL INPUT OR

REDUCED OUTPUT AS A RESULT OF REWORK


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IMPLEMENTATION PROCESS FOR

TOTAL PRODUCTIVITY MGT MISSION STATEMENT DEVELOPMENT

TOTAL PRODUCTIVITY MODEL AND COMPREHENSIVE

TOTAL PRODUCTIVITY MODEL ANALYSIS

MGT GOALS DEVELOPMENT

FISHBONE ANALYSIS

ACTION PLANS DEVELOPMENT

PRODUCTIVITY QUALITY TEAM TRAINING

IMPLEMENTATION OF ACTION PLANS

ASSESSING THE EXTENT TO WHICH THE MGT GOALS ARE

ACHIEVED

TOTAL PRODUCTIVITY GAINSHARING

NEW GOALS DEVELOPMENT


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STEP 1 MISSION

STATEMENT AN ENTERPRISE WITHOUT A MISSION STATEMENT IS LIKE

A BUILDING WITHOUT A FOUNDATION

MOST COMPANIES HAVE SO LITTLE SUCCESS WITH NEW

IDEAS BECAUSE THEY DONT HAVE A CENTRAL GUIDINGPHILOSOPHY CAPTURED THRU A VISION AND A MISSION

A VISION REPRESENTS A VERY LONG TERM GOAL

A MISSION REPRESENTS A SHORT TO MEDIUM TERM

STATEMENT OF PURPOSE

A MISSION STRETCHED OVER A RELATIVELY LONG PERIODOF TIME BECOMES A VISION

A CORRECTLY DRAFTED MISSION SHOULD HAVE SEVERAL

CHARACTERISTICS


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FACTORS TO BE CONSIDERED

IN MISSION STATEMENT HIGHLIGHT MAJOR STRENGTHS

HIGHLIGHT ENVIRONMENTAL FACTORS

SUCH AS ECONOMIC,POLITICAL,SOCIAL) STRATEGY FOR COMBATTING

COMPETITION

QUALITY OF SERVICE

STRATEGY FOR SUPPLIERS

CUSTOMER CHARACTERISTICS

MARKET CHARACTERISTICS


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CHARACTERISTICS OF

GOOD MISSION STATEMENT ARTICULATES GUIDING PHILOSOPHY OF

ENTERPRISE WITH A CENTRAL FOCUS

CONCISELY WORDED COMES NATURALLY TO EVERYONE

DEVELOPED CAREFULLY THRU ACTIVE

INVOLVEMENT OF EMPLOYEES

NEEDS TO BE REVISED AS PER THE

TACTICAL AND STRATEGIC PLANS OF THE

COMPANY AND THE THEN PREVAILING

INDUSTRIAL ENVIRONMENTAL OUTLOOK


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STEP 2 TPM ANALYSIS

TRENDS DISCOVERY IN

-TOTAL PRODUCTIVITY-BREAK EVEN POINT OF TOTAL PRODUCTIVITY

-HUMAN PRODUCTIVITY

-MATERIALS PRODUCTIVITY

-FIXED CAPITAL PRODUCTIVITY

-WORKING CAPITAL PRODUCTIVITY

-ENERGY PRODUCTIVITY

-OTHER EXPENSES PRODUCTIVITY


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STEP 3 MANAGEMENT

GOALS FOUR CRITERIA FOR A GOAL TO QUALIFY AS A MGT GOAL

EVERY MGT GOAL MUST

-ACHIEVE MISSION STATEMENT

-BE VERY SPECIFIC-BE TIME BASED

-BE VERIFIABLE

IN HMT THE GOALS ESTABLISHED WERE

-INCREASE HUMAN PRODUCTIVITY BY 7% PER YEAR

-INCREASE OTHER EXPENSE PRODUCTIVITY BY 3.5% YRLY

-REDUCE INVENTORIES BY 5% INORDER TO INCREASE

WORKING CAP ITAL PRODUCTIVITY


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STEP 4 FISHBONE ANALYSIS

WELL ESTABLISHED TOOL TO ANALYZE

THE CAUSES FOR A PROBLEM

FISHBONE ANALYSIS DONE FOR EACH OFMGT GOALS IN STEP 3

IF A COMPANY CAREFULLY ANALYZES

ALL TASKS , PROCESSES AND

TECHNIQUES NEEDED TO ACCOMPLISHEACH MGT GOAL , IT WILL BE BETTER

EQUIPPED TO ALLOCATE RESOURCES

TOGOALS THAT WOULD ATTAIN ITS

MISSION


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Cause-and-Effect Diagram for

Manufacturing

Exhibit S6.8Exhibit S6.8


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STEP 5 ACTION PLANS

ACTION PLAN IS DEVELOPED FOR EACH MGT GOAL

ACION PLAN INCLUDES DETAILS OF TASKS ,START AND

END DATES,PEOPLE RESPONSIBLE FOR EACH TASK

ACTION PLAN IS ANOTHER WAY TO CREATE A CAREFULTHOUGHT OUT PLAN OF ACTION TO ACHIEVE A MGT GOAL

TOOL TO ASSIGN PEOPLE TO TASKS WHICH WHEN

ACCOMPLISHED WILL ACHIEVE MGT GOALS WHICH IN

TURN WILL AID ACHIEVEMENT OF VISION AND MISSION

ACTION PLAN HELPS IDENTIFY BOTTLENECKS


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STEP 6 PRODUCTIVITY

QUALITY TEAM TRAINING TRG IS PROVIDED TO ALL

EMPLOYEES SO THAT THEY HAVE

THE REQUISITE TOOLS TOACCOMPLISH TASKS IN THE ACTION

PLANS IN AN EFFECTIVE AND

EFFICIENT MANNER TRAINING FOCUSES ON PROBLEM

SOLVING


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STEP 7 IMPLEMENTATION

OF ACTION PLANS IMPLEMENTATION BECOMES MORE

SYSTEMATIC WITH DETAILED

ACTION PLAN ACTION PLANS ARE CONSTANTLY

REVISED AS THE TASKS PROGRESS

THER IS A CONTINUOUS FEEDBACKCONTROL WHICH IS MONITORED

CAREFULLY


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STEP 8 MGT GOALS

ACHIEVED PROGRESS TOWARDS ACHIEVEMENT OF

GOALS IN STEP 3 ASSESSED ON A

PERIODIC BASIS SAY QUARTERLY IF A GOAL IS NOT ACHIEVED THE ACTION

PLAN RELATED TO THAT GOAL NEEDS TO

BE REVIEWED AND CORRECTIVE ACTION

INITIATED WHICH INCLUDESDOWNSIZING OF GOAL IF ACHIEVEMENT

IS NOT POSSIBLE DUE TO INTERNAL AND

EXTERNAL ENVIRONMENTAL CAUSES


82/837

STEP 9 TOTAL PRODUCTIVITY

GAIN SHARING BRAINSTORMING APPROACH BASED ON TOTAL

PRODUCTIVITY

STEP PROVIDES FOR A TANGIBLE MONETARY INCENTIVE

TO ACHIEVE THE MAXIMUM POSSIBLE POTENTIAL OF TPM REASONS FOR INCLUDING GAIN SHARING IN TPM INCLUDE

-NEED TO SUSTAIN MOTIVATION IN NEW CONCEPTS.

INTANGIBLE MOTIVATION IS A NECCESARY CONDITION

NOT A SUFFICIENT ONE TO SUSTAIN POSITIVE

MOTIVATION

-IT IS FAIR TO SHARE GAINS WITH RESPONSIBLE FOR IT

-RATE OF NEW HIRING CAN BE REDUCED DRAMATICALLY

SELECTED ELEMENTS IN


83/837

SELECTED ELEMENTS IN

PRODUCTIVITY LINKED

BONUS INCREASED PRODUCTION

REDUCED LABOUR COSTS

BETTER MATERIAL UTILIZATION MINIMIZED OVERHEAD EXPENSES

OPTIMUM UTILIZATION OF CAPITAL EMPLOYED

AND HIGH LIQUIDITY OF CURRENT ASSETS

BETTER PRODUCT DESIGNS AND REDUCED TIMETO MARKET

REDUCTION IN WASTE


84/837

STEP 10 NEW GOALS

SET NEW GOALS WHEN ALL

PREVIOUS GOALS HAVE BEEN

ACHIEVED SET ANNUAL GOALS. THIS LOOKS

OKAY BUT IN A DYNAMICALLY

CHANGING SITUATION ANNUALREVIEW OF GOALS MAY BE A BIT

TOO LATE. NEED TO REVIEW EITHER

ON A QTRLY BASIS OR WHENEVER


85/837

HOW DO WE IMPROVE

PRODUCTIVITY


86/837

THE PROFIT GOAL

PROFIT = REVENUE - COSTS


87/837

MAJOR STEPSMAJOR STEPS

Analyze the Revenues

Analyze the Costs

And then Prioritize

Find the Vital Few Components of cost


88/837

ANALYZE REVENUEANALYZE REVENUE

SOURCESSOURCES


89/837

ANALYZE COSTSANALYZE COSTS


90/837

CLOSELY LOOK AT

Labour costs

Material costs

Energy costs

Finance costs

Overhead costs


91/837

HOW PRODUCTIVITY CAN

BE IMPROVED INCREASING OUTPUT WITH SAME

INPUT

INCREASING OUTPUT MORE THANTHE INCREASED INPUT

DECREASING INPUT FOR SAME

OUTPUT INCREASING OUTPUT WITH

DECREASED INPUT

IMPROVING LABOUR


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IMPROVING LABOUR

PRODUCTIVITY Improving working conditions- lighting, ventilation,

noise(music), temperature, work times

Using appropriate and better tools

Ergonomics and better work station layout.

Improving factory, stores & office layout.

Improving the method/process - use 5Ws & IH

Improving the nutritional status of the worker

Improving industrial housekeeping(5s) and safety

Improving welfare facilities and worker motivation

USE THE BRAINS OF THEUSE THE BRAINS OF THE


93/837

USE THE BRAINS OF THEUSE THE BRAINS OF THE

WORKERWORKER

Quality Circles

Staff Suggestion Schemes

Kaizen System(Seiri-sort,Seiton-Set-order, Seiso-clean-up-Shine Seiketsu-

standardize, Shitsuke-Sustain-Training

& Discipline)

3 Mu -Muda(Waste), Muri-

(Strain),Mura(Discrepancy)

IMPROVING CAPITALIMPROVING CAPITAL


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IMPROVING CAPITALIMPROVING CAPITAL


Implement TQM

Reduce Working capital

Reduce floor space

Utilize machinery & equipment better

etc..

IMPROVING MATERIALIMPROVING MATERIAL


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IMPROVING MATERIALIMPROVING MATERIAL


Cheaper material

Alternative material

Cheaper sources

Better utilization

IMPROVING ENERGY


96/837

IMPROVING ENERGY

PRODUCTIVITY

Improve power factor

Reduce wastage

Change processes for less heating

Study working procedures

etc.


97/837

BENEFITS OF TOTAL

PRODUCTIVITY MGT CUSTOMER RESPONSIVENESS

QUALITY COMPETITIVENESS

TOTAL COST COMPETITIVENESS TEAM BUILDING AND ACCOUNTABILITY

TECHNOLOGY PLANNING

INVESTMENT ANALYSIS ACQUISITION AND MERGER PLANNING

PROFIT TARGETTING


98/837

MAKE PRODUCTIVITY A

WAY OF LIFE

Think Productivity Talk Productivity

Demonstrate Productivity

Be Productive at Home, on the Road, andin Office


99/837

REMEMBER!

ProductivityProductivitystarts withstarts with

You !You !


100/837

ENERGY PRODUCTIVITY

Energy use transitions hold key to


101/837

Energy use transitions hold key to

future trajectory

Household energy mix is rapidly moving from

inefficiently-utilized biomass to gas and electricity

Commercial space is increasing; and energy use iscommercial space is increasing at a faster pace

Industrial energy intensity is declining, but there is

a wide bandwidth of specific energy consumption

within industrial sectors


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Barriers to Energy Efficiency

Lack of information about comparativeenergy use especially of appliancesbought by retail consumers

Perceived risk due to lack of confidence inperformance of new technologies inappliances, building design, industrialtechnologies

Higher cost of energy-efficient technologies

Asymmetry in sharing of costs andbenefits especially in the buildings sector

Energy Policy of India Short term


103/837

Source: BEE-IREDA

gy y Maximize returns from the existing assets Current deficit

in demand supply is 15% peakload Reduce losses in transmission and distribution(43%

losses) and in end use

Initiate action to reduce energy intensity of different

consuming sectors and promote conservation through

organizational and fiscal measures

Initiate steps to meet the basic energy need of rural and

urban households so as to reduce the existing inequities.

Maximize satisfaction of demand for energy from

indigenous resources

Energy Policy of India Medium term


104/837

Source: BEE - IREDA

gy y

Progressive steps to substitute petroleum productsby coal, natural gas and electricity

Action for accelerated development of all

renewable energy resources especially hydro

potential

Promote programmes to achieve self-reliance in

energy sector

Create appropriate organizational changes inconsistent with the over all energy strategy


105/837

Sorces: BEE - IREDA

Energy Policy of India Long term

Promote an energy supply system, largely

based on renewable sources of energy

Promote technologies of production,transportation and use of energy that are

environmentally benign and cost effective

Potential for Energy


106/837

Source: Powerline

Potential for Energy

Conservation Indias energy intensity per unit of GDP is higher

compared to Japan, US and Asia by 3.7, 1.55 and1.47 times respectively. This indicates inefficientuse of energy but also substantial scope for energy

saving. One unit of energy saved at the consumer end

avoids nearly 2.5 to 3 times of capacityaugmentation due to PLF, auxiliary consumption

and T & D losses The conservative estimate of potential of energy

saving in India is creating nearly 25,000 MW ofnew capacity

P i l f E C i


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Source: Powerline

Potential for Energy Conservation -

Sector-wiseSector Potential %

Industrial Up to 25

Transport Up to 20

Agricultural Up to 30

Domestic and

Commercial

Up to 20

Economy as a whole Up to 23

Potential for Energy Conservation


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Source: Powerline

Industrial Sector

Industry Saving Potential %Iron and Steel 10

Fertilizer 15

Textile 25

Cement 15

Paper 25

Aluminum 10

Sugar 20Petrochemicals 15

Refineries 10

Potential for Energy Conservation


109/837

Source: Powerline

Agricultural Sector

Code Nature of Improvement Reduction in

consumption

%

R1 Low resistance foot valve and

suction pipe

Up to 25

R2 R1 + Low friction delivery pipe Up to 35

R3 R2 + Higher efficiency Pump Up to 45

R4 R3 + Lower rating motor Up to 60

Commercial Sector


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Source: Powerline

Commercial Sector

End-Use Saving estimate %

Lighting Up to 50

Cooling Up to 50

Ventilation 50

Heating 15 - 40

Refrigeration 15 - 40Water Heating 40 - 60

Miscellaneous 10 - 30

Residential Sector


111/837

Source: Powerline

Residential Sector

End Use Saving estimate %

Lighting 20 - 50

Cooling / Ventilation 15 -50

Refrigeration 15 - 40

Water heating equipment 20 -70

Miscellaneous Equipment 10

Energy Conservation Case Studies


112/837

Source: IREDA-BEE

Century Rayon (Savings achieved)

Description 2008-09 2009-2010 Reduction in

%

Electrical

energy

204.7 MU 161.1 MU 22

Cost Rs 633.4million

Rs 431.3million

32

E C ti d


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Energy Conservation and

productivity In broad sense, energy conservation means more efficient

use of energy without reducing production levels andwithout sacrificing product quality, safety or

environmental standards. Productivity is defined as the output of any productionprocess, per unit of input. To increase productivity meansto produce more with less.

Traditional energy managers considered EC opportunities

as independent of other industrial productivity relatedopportunities

Energy-only recommendations had little impact on theproductivity of manufacturing plant

C i


114/837

Source: renewingindia, icraindia

Energy Conservation

A key factor to productivity Indian energy intensive industries (cement, Iron &

steel, aluminum, textiles, paper, chlor-alkalis etc)consumes 65 % of Industrial energy

Energy cost accounts for 40 % of Aluminum production cost

30 35 % of Iron and Steel production cost

30 32 % of Cement production cost

30 % of Paper production cost

50 60 % of Chlor-alkalis production cost

12 15 % of Textiles production cost

Energy ConservationA k f d i i C d


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A key factor to productivity -Contd

The potential for energy conservation is around 25 %in Indian Industries and 23 % for whole Indianeconomy

No other constituent of manufacturing can influencethe productivity to this great extent

No other constituent of manufacturing can have a greatpotential for improvement in productivity

Energy is a manageable expenses and it can be easilycontrolled through dedicated efforts. EnergyConservation is the quickest, cheapest and most

practicable method of increasing the productivity. Hence Energy Conservation will be one of the most

important factorto increase the productivity in thefuture

nergy onserva on A key factor to productivity -Contd


116/837

Source: Powerline

A key factor to productivity Contd

Industry Energy Saving

Potential %

Iron and Steel 10Textile 25

Cement 15

Paper 25Aluminum 10


117/837

What can I do now tocurb rising utility

costs?

How can I better control utility

costs in the future?

Identify opportunitiesOptimize use of facilities

Switch off power when not needed


118/837

WASTE MANAGEMENT


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Waste is anything other than

the minimum amount of

equipment, materials, parts,space, and workers time,

which are absolutely

essential to add value to the

product.

Shoichiro Toyoda

President, Toyota 1995 Corel Corp.

Introductory Quotation

What is WASTE?


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120

What is WASTE?

Any Activity that DOES NOT increase the

Market Form or Function of the Product or

Service based on the Critical Customer

Requirements.

These are things the customer is NOT

willing to pay for.

DEFINITION OF


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WASTE

THE OXFORD DICTIONARY DEFINES WASTEAS UNPURPOSEFUL OR EXTRAVAGANTACTIVITY WHICH RESULTS IN

UNPRODUCTIVE END RESULTS WASTE IS A PRODUCT,ACTIVITY ORSERVICE FOR WHICH AN EXTERNALCUSTOMER IS UNWILLING TO PAY FOR

CASE OF SECURITY CESS IN RAILWAYS

WASTE IS ONLY NUISANCE VALUE TOCUSTOMER


122/837

WASTE MANAGEMENT

WASTE EXISTS EVERYWHERE FROMINDUSTRY TO HUMAN ACTIVITIES

IN ANY PROCESS WASTE ACCOUNTS FOR

A VERY LARGE AMOUNT OF NON VALUEADD ACTIVITY

MGT NEEDS TO CONTROL ACTIVITIESBETTER THRU TIGHTER CONTROL

WASTE MGT IMPROVES COSTS ANDPRODUCTIVITY AND REDUCES CYCLETIMES


123/837

MUDA MURI MURA

3 JAPANESE TERMS USED BY TOYOTA TO

SIGNIFY DIFFERENT TYPES OF WASTES

MUDA IS WASTE. TWO TYPES OF WASTE TYPE 1

MUDA UNAVOIDABLE WASTE OR FORCEDSCRAP(ESSENTIAL NVA);TYPE 2 OR AVOIDABLE

WASTE

MURA IS WASTE OF INCONSISTENCY OR

UNEVENNESS OF FLOW.UNEVENNESS INPRODUCTION FORCES PROCESSES TO DEAL WITH

SPIKES IN DEMAND AND HAS IDLENESS IN

SLACK PERIODS

MURI IS OVERBURDENING OF SYSTEM 123


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124

Eliminate Waste

Muda anything that does not add value

for the customer

Products in storage Products being inspected

Products waiting in queues

Defective products Unnecessary movement of materials or workers

- 2 TYPES OF WASTES TYPE 1 WASTE WHICH ISESSENTIAL NON VALUE ADD ACTIVITIES AND TYPE 2

WASTE WHICH IS ELIMINATABLE eg INSPECTION


125/837

125

Examples of Waste Idle machine run Waiting for parts

Counting parts

Overproduction Moving parts over long distances

Storing inventory

Looking for tools

Machine breakdown

Rework


126/837

Common Causes of Waste

Layout (distance)

Long setup time

Incapable processes Poor maintenance

Poor work methods

Lack of training

Inconsistentperformance measures

Ineffective production

planning

Lack of workplaceorganization

Poor supplyquality/reliability

Common Causes of Waste


127/837

Excess Manning

Poor layout and material presentation Rework and extra processes

Inconsistent / inefficient work methods

Excess Downtime

Tooling condition Unreliable equipment

Long changeovers

Incapable process

Defectives - Rework or Replace

Incapable processes or process not compatiblewith customer expectations or design spec (designfor mfg)

Tooling condition

Operator methods and errors

Where is the Waste?


128/837

128

Defects incomplete or incorrect information

Overproduction releasing work before nextprocess can work on them, unbalanced work loads

Waiting unbalanced work loads, slow system response,incomplete information, approvals

Not Utilizing Employees old guard thinking, politics, high

turnover, low investment in training

Transportation poor layout, poor flow

Inventory large batches, complexity to complete task

Motion poor organization, no standard work

Excess Processing excess communication, lack ofcommunication, unnecessary approvals, customerrequirements are not clearly understood

All processes have waste.

Types of Waste (Muda)


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. 9-129

Types of Waste (Muda)

in Toyota production system Overproduction

Waiting

Transportation

Inventory

Motion

Overprocessing

Defects

PRODUCING DEFECTS


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PRODUCING DEFECTS

DEFECTS IN PRODUCT / SERVICE ARE MAJOR SOURCE OF WASTE

COSTS OF WASTE INCLUDE WARRANTY COSTS,ATTENDINGCOMPLAINTS AS WELL AS REWORK,INSPECTION

CASE OF DELL COMPUTERS

PRODUCT DEFECTS TO BE ELIMINATED BY QUALITY ASSURANCE INDESIGN ELIMINATING NEED TO INSPECT OR REWORK

DEFECTS INCREASE PRODUCTION COSTS AND LEAD TIME OFMANUFACTURE

DEFECTS DUE TO WRONG OPERATING PROCEDURES,VARIATIONS INOPERATIONS RESULTING IN M/C WEAR,DEFECTIVE RAW

MATRL,OPERATOR ERROR etc

TRANSPORTATION ANDMATERIAL HANDLING


131/837

MATERIAL HANDLING

ITEMS IN MFG MOVED FROM STATION TO STATION TRANSPORTATION WASTES TIME AND IN THE CASE

OF HUMAN BEINGS WHO MAY HAVE TO MOVE FROMSTATION TO STATION TO DO WORK IT IS

FATIGUING AND CAUSES DECLINE INPRODUCTIVITY AND INCREASE IN ERROR RATES OBJECTIVE IS TO MINIMIZE HUMAN EFFORT IN

TRANSPORTATION AND MATERIAL HANDLING BYHAVING CONVEYOR BELTS

CASE STUDY OF AUTOMOBILE ASSEMBLY LINEWHERE AUTOMOBILE MOVES ON THE CONVEYORBELT AND MAN IS STATIONARY.TIME REDUCEDFROM 12HRS/CAR TO 1 HR/ASSEMBLY

INVENTORY


132/837

INVENTORY AS PER TOYOTA IS ONE OF THE SEVENSINS

INVENTORY REPRESENTS ITEMS WAITING FORSOMETHING TO HAPPEN (JUST IN CASE)

INVENTORY IS CARRIED TO PREEMPT DELAYS INDELIVERY OF PROCESS INPUT OR TO PROVIDE FORCUSHION STOCKS TO TAKE CARE OF MFGREWORK/SCRAP (SOME CUSHIONS ACCOUNT FORAS MUCH AS 5% OF RAW MATERIAL)

WASTES ASSOCIATED WITH HOLDING COSTS,

DEPRECIATION, EXPIRY DATES , DETERIORATION.PILFERAGE ETC JUST IN TIME IS THE REMEDY FOR EFFECTING ZERO

INVENTORY

OVERPRODUCTION


133/837

OVERPRODUCTION

EXCESS PRODUCTION BECAUSE OFWRONG SALES FORECASTS OR ATTEMPTTO KEEP FACILITIES RUNNING

MFG OF EXCESS PRODUCTION IS WASTE

CASE OF ALL SALES OF READY MADEGARMENTS

WASTE FROM OVERPRODUCTION ISREFLECTED IN UNSOLD STOCKS WHICH

ADD TO FINISHED GOODS INVENTORY

WAITING


134/837

WAITING

WASTE OF WAITING IS EASY TO IDENTIFY

WAITING IS A RESULT OF UNBALANCEDPROCESS SEQUENCE OR BREAKDOWN INBOTTLENECK PROCESS

INCLUDES WAITING FOR ORDERS, RAWMATERIAL, POWER, SPARES, LABOUR OR EVENFUNDS TO PROCURE RESOURCES

WAITING ALSO INCLUDES ITEMS FROMPRECEDING PROCESSES

EXAMPLE OF PILE UP OF WIP OR PERISHABLESAWAITING CUSTOMS CLEARANCE

WAITING


135/837

WAITING MINIMIZED BY BUSINESSPROCESS ACTIVITY IMPROVEMENT ORMINIMIZATION OF LEAD TIME TO

PROCURE THROUGH VENDOR MANAGEDINVENTORY OR OTHER INITIATIVES

WAITING ALSO MINIMIZED BY GOODMAINTENANCE PRACTICES SUCH AS CBMRESULTING IN MAXIMIZEDEFFECTIVENESS

PROCESSING


136/837

PROCESS MAY CONTAIN ACTIVITIES WHICH AREINEFFECTIVE OR UNNECCESARY

PROCESSING WASTE CAN BE ELIMINATED BYMINIMIZING MOTION REQUIRED TO PERFORM

WORK ACTIVITY ANALYSIS DONE TO DETERMINE

PROCESS UTILISATION TIME AND THEREAFTERPROCESS IMPROVEMENT DONE TO ELIMINATEDELAYS AND NON VALUE ADDED ACTIVITIES

MOTION


137/837

BEING IN MOTION IS INCORRECTLY CONNOTED TO BE ATWORK

MOTION AND WORK ARE NOT THE SAME

WORK IS CONSIDERED A PARTICULAR KIND OF MOTION THATADDS VALUE

AN APPARENTLY BUSY PERSON MAY ACTUALLY PRODUCEVERY LITTLE WORK

INHERENT HANDICAP AT RIGHT HANDED WORKPLACE FORLEFTHANDERS

MOTION UNREQD TO DO WORK IS WASTE

EXCESSIVE MOTION CAUSES FATIGUE AND LOSS OFPRODUCTIVITY AND INCREASE OF WASTE

CASE OF BEARING LIFETIME INVERSELY PROPORTIONAL TORPM

ROOT CAUSE OF TOYOTAWASTES


138/837

WASTES

USAGE OF 5 WHY ANALYSIS

DEFECTS

-INADEQUATE DESIGN POOR MATERIAL

-WRONG PROCESS SPECIFICATIONS

-OPERATOR ERROR -INADEQUATE TESTING

TRANSPORTATION

-WAIT TIME TO TRAVEL -LAYOUT

INVENTORY

-OBSOLETE STOCKS JUST IN CASE WRONGFORECST

CUSTOMER CANCELLATIONS MKT SLUMP

OVERPRODUCTION -WRONG FORECAST

ROOT CAUSE OF TOYOTAWASTES


139/837

WASTES

WAIT TIME

-IMBALANCE IN PROCESS THROUGHPUT ORPROCESS BREAKDOWN

-POOR SCHEDULING -INADEQUATE LABOURSCHEDULING

MOTION

-EXCESS MOTIONEXCESS PAPER DISTRIBUTION

PROCESSING-INEFFECTIVE OR NON VALUE ADDED STEPS

REMEDIES FOR TOYOTAWASTES


140/837

WASTES

WASTE REMEDY

OVERPRODUCTION JIT/PULL PRODUCTIONWAITING PROCESS ACTIVITY STUDY

TRANSPORTATION MOTION STUDYWRONG PROCESSING METHOD STUDYEXTRA INVENTORY JUST IN TIMEEXTRA MOTION MOTION STUDYDEFECTS ROOT CAUSE ANALYSIS

AND FMECA

OTHER( ) WASTES


141/837

OTHER(canon) WASTES

WASTED CAPACITY

WASTED ENERGY

WASTE FROM LOST OPPORTUNITY

WASTE FROM UNREQD EXPENSES

WASTE FROM UNUTILISED TALENT WASTE FROM LOSSES DUE TO

EFFICIENCY,STARTUP,IDLING, BATCH CHANGEOVER

WASTE DUE TO COMMN LOSSES OR INEFFECTIVENESS OFCOMMN

WASTED PLANNING EFFORTS

WASTED INVESTMENTS WASTED OVERSTAFFING

WASTE IN DISPOSAL

OFFICE WASTES


142/837

ERRORS IN DOCUMENTS

DOING UNREQUIRED WORK NOT REQUESTED PROCESS OF GETTING APPROVALS AND NEEDLESS LEVELS OF

APPROVALS BACKLOG OF WORK UNREQUIRED STATIONERY FILES PAPERS AT WORKPLACE

UNCLEAR JOB DESCRIPTIONS RESULTING IN UNDEFINEDOUTCOMES

EXCESS DEBIT CREDIT NOTES DUE TO ERRONEOUS POINVOICE

OBSOLETE DATABASES

TYPOGRAPHICAL ERRORS UNREQUIRED COMMUNICATION

LEVELS OF WASTE


143/837

FOUR LEVELS OF WASTE-BUSINESS LEVEL WASTES-PLANT LEVEL WASTES

-PROCESS AND METHOD WASTES-OPERATING LEVEL WASTES

LEVEL 1 BUSINESS LEVELWASTE


144/837

WASTE LONG TERM AND SHORT TERM GOALS NOT COMMENSURATE

WITH CAPABILITIES AND CAPACITY SHORT TERM GOALS NOT ALIGNED WITH LONG TERM

STRATEGIC GOALS WHICH ENABLE THE REALISATION OFVISION

STRATEGIC OBJECTIVES OF EACH FUNCTION NOT IN UNISON

WITH CORPORATE OBJECTIVES LACK OF COORDINATION AND UNDERSTANDING WITH

STAKEHOLDERS LOP SIDED FINANCING INSTAL OF EXTRA CAPACITY W/O MAXIMISATION OF

CURRENT

STRATEGIC DIVERSIFICATION IN AREAS WITHOUTOPPORTUNITIES AND CORE COMPETENCE

INEFFICIENT PRODUCT LIFECYCLE PLANNING AND MGT

LEVEL 2 PLANT LEVEL WASTE


145/837

POOR PPC NOT BASED ON MARKETDYNAMICS

HIGH INVENTORIES

LOW PLANT EFFECTIVENESS ANDUNPROFITABLE OPERATIONS

HIGH OVERTIME PAYMENTS BUT LOW

EMPLOYEE PRODUCTIVITY

LEVEL 3 PROCESS ANDMETHODS LEVEL WASTE


146/837

METHODS LEVEL WASTE

INCORRECT OR INEFFECTIVEPROCESS METHODS

BORNE OUT OF LACK OF SKILLS OR

ATTITUDE

NEED TO MONITOR AND DO PERIODICMETHOD STUDIES TO MAXIMIZE

PROCESS THROUGHPUT WITHMINIMUM EFFORT

LEVEL 4 OPERATIVE LEVELWASTE


147/837

WASTE

POOR OPERATIVE CONTROLSRESULTING IN HIGH MFG COSTS

HIGH REWORK/REJECT CONTENT eg

.04% value of sales realized thru saleof scrap in 2008-09 and 0.16% valueof sales realized in 2009-10

UNDULY HIGH REACTIVEMAINTENANCE % ie 17.5% ofmaintenance time against 2% worldclass (includes 7% breakdown)

R t f t


148/837

Root cause of waste

Defects

Inadequate Design - Poor Matrl - Wrong Proc - Oper Error

Inadequate Testing

Over Production

Over enthusiastic incentive - Wrong Forecast

Excess Inventory

Obsolete Stocks - Wrong Forecast - Customer amendments/cancellation

Poor Quality - Market Condition

Unrequired Motions

Over use of paper/distribution - Excess Walking - Excess Motions

Transportation Layout - wait time to travel

Wait Time

Poor Scheduling - Imbalance in prodn line - Inadequate labor resource

R t f t


149/837

Root cause of waste

Process

Wrong operations or poor material leading to rework orreject

Poor process control Poor operating specifications

Untrained or de motivated operators

TOTAL WASTE REDUCTION


150/837


STRUCTURED APPROACH TO DEAL WITH

WASTES AND DELAYS WITH VIEW TO

ELIMINATION

APPROACH SEPARATES WASTE(NON

VALUE ADD ACTIVITIES) FROM VALUE

ADDITION AND SCRUTINISES ESSENTIAL

NON VALUE ADD ACTIVITIES FORMINIMISATION OF WASTEFUL ACTIVITIES

PREREQUISITE FOR TQM



151/837


WASTE MAY EXIST IN PROCEDURES POLICIESSYSTEMS AND IS DIFFICULT TO IDENTIFYHIDDEN WASTES

AUTOMATION IS NOT THE SOLUTION TO WASTE

NEED OF THE HOUR IS TO IDENTIFY REALWASTES THAT AFFECT BOTTOM LINES

WASTE MGT SHOULD BE A CONTINUOUS DRIVEON THE GUIDELINES OF TQM

PERIODIC REVIEW OF

POLICIES,PROCEDURES,PROCESSES TO ENSUREPROCESS IMPROVEMENT AND WASTEREDUCTION



152/837


DRASTICALLY IMPROVES QLTY,PRODUCTIVITY,FLEXIBILITY AND SAFETY

REDUCES CYCLE TIME AND IMPROVESRESPONSIVENESS

MAXIMIZES UTILIZATION OF ASSETS ANDPROCESSES

MINIMISES [PROCESS LOSSES AND COST OF NONCONFORMITY

REDUCES PROCESS AND PRODUCT COST AND

IMPROVES CONTRIBUTIONS IMPROVES LIQUIDITY BY FREEING MONEY TIED

UP IN INVENTORIES AND OTHER WASTES

ELIMINATION OF 3M


153/837

ELIMINATION OF 3M

3M EXERCISE DONE TO

-ELIMINATE WHOLE ACTIVITY

-REDUCE STEPS IN ACTIVITY-CHANGE AND SIMPLIFY ACTIVITY

-REDUCE THE TIME COST AND

FATIGUE INVOLVED IN ACTIVITY

ELIMINATION OF 3M


154/837

ELIMINATION OF 3M

3M STAND FOR MUDA MURA AND MURI

MUDA MEANS WASTES OF ALL KINDSSUCH AS

REWORK,TRANSPORTATION,DELAYS MURA MEANS INCONSISTENCES SUCH ASNON CONFORMANCE TO QLTY AND STDOPERATING PROCEDURES

MURI MEANS NON RATIONALITY OR

DISCREPANCY ie UNSCIENTIFIC WAY OFDOING THINGS

MUDA


155/837

MUDA

MUDA MEANS WASTE

WASTE IS ANY ACTIVITY THAT DOES NOT ADD VALUE

SUCH ACTIVITIES CONTRIBUTE TO COST OF POOR

QUALITY

MUDA IS TOTAL COST OF EXTERNAL PRODUCT/SERVICE

FAILURE PLUS THE COST OF PREVENTIVE MEASURES

MUDA DEFINED IN TOYOTA 7 WASTES AND CANON 9

WASTES

ELIMINATING MUDA REDUCES COST OF PRODN ,

ENHANCES PRODUCTIVITY , REDUCES CYCLE TIME , AND

LEADS TO BETTER CUSTOMER SATISFACTION

MUDA (WASTE) EXPLAINED OVERPRODUCTION WASTE


156/837

OCCURS WHEN WE PRODUCE WHAT IS UNNECESSARY, WHEN IT ISUNNECESSARY, AND IN UNNECESSARY AMOUNT.

INVENTORY WASTEINVENTORY-SYMPTOM OF ILL HEALTH IN FACTORY OPERATIONS. INVENTORYAVOIDS BUT NEVER SOLVES PROBLEMS.

CONVEYANCE WASTE

IS A RESULT OF POOR LAYOUT, HANDLING, OF MATERIAL ETC.

. DEFECT PRODUCTION WASTE

HUMAN ERRORS CAUSE DEFECTS, DEFECTS ARE WASTE AND ALSO CAUSE

WATE OF DETECTION, CORRECTION, CUSTOMER COMPLAINTS ETC. THEYALSO DISRUPT NORMAL FLOW OF GOODS AND REDUCE PRODUCTIVITY

. PROCESS-RELATED WASTE

EXAMPLES:

I. DRILLING MACHINE SCREW HOLES, EVEN AFTER DESIGN HAS CHANGEDTHE FASTENING METHOD TO WELDING

II. USING SIX SCREWS WHERE FOUR MEET THE PURPOSE.

OPERATION RELATED WASTENOT ALL OF WORKERS MOVEMENT IS WORK OR VALUE-ADDING, SUCHWASTE RESULTS FROM POOR EQUIPMENT LAYOUT OR BY POORLY PLACEDPARTS, JIGS & TOOLS.

IDLE TIME WASTE

INCLUDES HUMAN AS WELL AS MACHINE IDLE TIME. GENERALLY IT IS THETIME OF WAITING FOR SOMETHING.

8 types of Muda8 types of Muda


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1. Muda of over-production

2. Muda of waiting

3. Muda of transport

4. Muda of processing

5. Muda of inventory

6. Muda of motion

7. Muda of repair/rejects

8. Muda of Untapped Human potential

MURI


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MURI

MURI MEANS UNREASONABLE OR IRRATIONAL

APPROACH TO ANY OPERATION

KAIZEN CHECKLIST TRIES TO LOOK INTO IMPROVEMENT

BY IDENTIFYING AND ELIMINATING THE

UNREASONABLENESS IN AREAS SUCH ASMANPOWER,TECHNIQUE,METHOD,TIME,FACILITIES,TOOLS,

MATERIALS,INVENTORY,PLACE,PRODUCTION,,QUANTITY,

QUALITY, etc

MURI LOOKS FOR IRRATIONALITY WITH FOUR MAJOR

APPROACHES

Muri


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Muri

Muri = Physical Strain

Bend to work?

Push hard? Lift weight?

Repeat tiring action?

Wasteful walk?

All this is Muri

4 APPROACHES OF MURI


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4 APPROACHES OF MURI

THINGS OR ACTIVITIES THAT ARE EXTREMELY DIFFICULT

TO DO AND AT THE MOMENT BEYOND REACH SHOULD BE

IDENTIFIED AND ELIMINATED FROM ACTIVITIES

DO NOT PURSUE ACTIVITIES THAT DO NOT ADD VALUE

IDENTIFY AND REFINE REASONS FOR PERFORMING

ACTIVITIES

ELIMINATE IRRATIONAL OPERATIONS THAT CAUSE

FATIGUE

MURA


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MURA

INCONSISTENCY IN OPERATIONS

DEVIATION FROM STANDARDS

LEADING TO INCONSISTENCY MURA CALLS FOR MINIMUM

DEVIATION BETWEEN BEST AND

WORST PRODUCT BY MINIMIZINGRANGE OF STD DEVIATION USING

SPC

EFFORTS REQUIRED IN WASTE MGTINITIATIVE


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ELIMINATING WASTE REQUIRES A COMPANYWIDE

INTEGRATED EFFORT WHICH INCLUDES ALLCORPORATE FUNCTIONS SUCH ASMARKETING,SALES,FINANCE,MANUFACTURING,R&D.

INDUSTRIAL ENGG, QUALITY,CUSTOMER SERVICE,

DISTRIBUTION,HR ETC

WASTE AS SEEN COMPRISES OF MFG AND ADMINWASTES

ADMIN WASTES COULD BE EXCESSIVECOMMUNICATION,UNCONTROLLED DISTRIBUTION OF

INFORMATION, DELAYED INFORMATION ,BREAKDOWNIN ADMIN SERVICES, ERRORS IN COMMERCIALDOCUMENTS,WASTED SALES CALLS,UNPRODUCTIVEMEETINGS ETC

COST OF I.T. /INFRASTRUCTURE DOWNTIME A MAJOR

ISSUE AND NEED FOR BUSINESS CONTINUITY PLAN

COST OF WASTE


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163

COST OF WASTE

1.WASTE FROM DEFECTS

-PLANNED 1ST QLTY FOR MTH 95%

-ACTUAL 1ST

QLTY FOR MTH 90%-LOSS/MTR FOR 2ND QLTY IS RS 40

-QLTY LOSS/YR = 5% *0.79MILLION

MTRS * 40 *12 = RS 1.896 CR

COST OF WASTE


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164

2.WASTE FROM INVENTORY-SPARES/RAW MTRL INV = 6.0CR

EXCESS OF 1 MTH INV = 5.0 CR

HOLD COST ON INV =5*0.20 = 1.0CR

INT ON EXCESS SP/RM =5*0.10 = 0.5CR-TTL WASTE ON A/C INV = 1.5 CR

COST OF WASTE


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165

3.OWING TO BREAKDOWN AND PROCESSINEFFICIENCY

UNIT PRODUCED 0.07 MILLION MTRS LESS FOR THEMTH WHICH AMOUNTED TO 0.84 MILLION MTRS LESS/YEAR

-AVERAGE REALISATION PER MTR IS RS 100-LOSS PER YEAR ON ACCOUNT OF OPPORTUNTIYLOST IS

0.84 MILLION MTRS * 100 RS/MTR = 8.4 CR RS

-TOTALCOST OF WASTE IS 1.896CR + 1.5 CR + 8.4CR

=11.796 CRORES

COST OF WASTE


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BUSINESS PROCESS WASTE

MANAGEMENT

166

NEED TO CALCULATE COST OF WASTE FOR MOTION ,PROCESSING, OVERPRODUCTION,TRANSPORT

WHICH SHOULD BE LOSS IN PRODUCTIVITY

COST OF IDENTIFIED WASTE AS PERCENTAGE OFSALES (135 CR) IS 11.7/135 =8.67%

CASE STUDY DOES NOT SUFFER FROM OVERPRODN

LOSS OF PRODUCTIVITY IS COMPUTED IN TERMS OFEXPECTED THROUGHPUT VERSUS ACTUAL ACHIEVED

LOSS OF PRODUCTIVITY CAN CONTRIBUTE TO AS

MUCH AS 5% OF TURNOVER


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5 S

8 Pillars Of TPM


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8 Pillars OfTPM

Definition of the Five Ss-PILLAR


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The Five S practice is a technique usedto establish and maintain a quality

environment in a company by

improving its organization,

in order to achieve high levels of

quality, safety, and productivity, for

which workers must have a conduciveworking environment.

The 5s Principles, Flow of the Five Ss

SEIRI Organisation/Sorting out; Only


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keeping necessary item

SEITON Orderliness/ Neatness/ SystematicArrangement; Everything has itsplace

SEISO The Cleaning/ Shining, Spick andspan; Keeping the workplace clean

SEIKETSU STANDARDIZATION; Making the

first 3Ss a daily job

SHITSUKE Sustain/ Self-Discipline; Enforcingthe Five Ss

Sort (Seiri) - Perform Sort Through and Sort Out, byl i d t ll d d it d i th

THE 5 Ss


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placing a red tag on all unneeded items and moving them

to a temporary holding area. Within a predetermined timethe red tag items are disposed, sold, moved or given away.

Set in Order (Seiton) - Identify the best location forremaining items, relocate out of place items, set inventorylimits, and install temporary location indicators.

Shine (Seiso) - Clean everything, inside and out.

Standardize (Seiketsu) - Create the rules for maintainingand controlling the first 3Ss and use visual controls.

Sustain (Shitsuke) - Ensure adherence to the 5S standardsthrough communication, training, and self-discipline.

1. Sorting Out (SEIRI)


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Decide what you need

Remove unnecessary clutter

All tools, gauges, materials, classifiedand then stored

Remove items which are broken,unusable or only occasionally used

RED TAG TECHNIQUE REDTAG


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GIVE STAFF RED LABELS

ASK STAFF TO GO THROUGH

EVERY ITEM IN THE WORK PLACE ASK IF NEEDED & THOSE THAT

ARE NEEDED,IN WHAT QUANTITY

NOT NEEDED RED TAG IT STORE IN THE RED TAG AREA

For wavering itemsRED

TAG


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PLACE THE SUSPECTED ITEMS INTHE RED TAG AREA FOR ONEWEEK

ALLOW THE STAFF TOREEVALUATE THE NEEDED ITEMS

AT THE END OF WEEK THOSEWHO NEED ITEMS SHOULD BERETURNED

Sorting out (Seiri)

PRIORITY FREQUENCY OF USE HOW TO USE


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PRIORITY FREQUENCY OF USE HOW TO USE

Low Less than onceper year

Throw away

Once per year Store away from

the workplace

Avg. Once per month Store together but

offlineOnce per weekHigh Once Per Day Locate at the

workplace

2. ORDERLINESS (SEITON)


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ONCE YOU HAVE ELIMINATED ALLTHE UNNEEDED ITEMS,

NOW TURN TO THE LEFT OVER

ITEMS study and improve how fast you canput items away, and retrieve them in time ofneed.

The goal should be to realizeimplementing the PEEP principle (Aplace for everything, and everythingin its place).

ORDERLINESS (SEITON)


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Organise layout of tools andequipment

Designated locations

Use tapes and labels

Ensure everything is available

as it is needed and at the pointof use

ORDERLINESS (SEITON)


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Workplace Checkpoints:

Positions of aisles and storage places

clearly marked?

Tools classified and stored by

frequency of use?

Pallets stacked correctly?

Safety equipment easily accessible?

Floors in good condition?

3. SEISO (CLEAN/SHINE)

this includes everyone,


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Create a spotless workplace

Identify and eliminate causes ofdirt and grime remove the needto clean

Sweep, dust, polish and paint

this includes everyone,

from the head honcho to the janitor.

SEISO (CLEAN/SHINE)


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Divide areas into zones

Define responsibilities for cleaning

Tools and equipment must be ownedby an individual

Focus on removing the need to clean

Cleanliness involves cleaning every aspect

of the organization and the removal of dirt,


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dust,oil, scraps on the floor, & garbage.Key Deliverables

A clean Systematic Organization results in increased

safety and efficiency.

Increased

Safety

Increased

Efficiency

4. SEIKETSU (STANDARDISE)


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Generate a maintenance system for thefirst three, viz., Seiri, Seiton, Seiso

Develop procedures, schedules, practices as standardized daily practices.

Continue to assess the use and disposal of

items

Regularly audit using checklists andmeasures of housekeeping

Real challenge is to keep it clean

5. SHITSUKE (SUSTAIN / SELF-DISCIPLINE)

Means inculcate courtesy & good habits


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Means, inculcate courtesy & good habits

Driving force behind all 5S

Demings point number 1: Constancy of

purpose

Make it a way of life

Part of health and safety

Involve the whole workforce*

Develop and keep good habits

5S INSPECTION SHEET

AT ASHOK LEYLAND


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AT ASHOK LEYLAND

1=NO IMPL;2=ALMOST NO IMPL; 3=PARTIALIMPL;4=MAJORITY IMPL; 5=FULL IMPL;

*ORGANISE

-UNREQD ITEMS-UNAUTHORISED ITEMS

-CLEAN WKPLACE

-FIREFIGHTING TOOLS

*SET IN ORDER

-CLEAN CLOTHING

-CLEAN WKPLACE

-ADEQUATE VENTILATION

-CLEAN EQPT

5S INSPECTION SHEET

AT ASHOK LEYLAND


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AT ASHOK LEYLAND


*SWEEP

-AREA FREE FROM THRASH AND DUST-EQPT OPERATIONS WORTHY

-CLEAN FLOOR

-CLEANUP RESPONSIBILITY CLEAR

*STANDARDISATION

-EVERYTHING IN ITS OWN PLACE

-THINGS PUT AWAY AFTER USE

-WORK AREA UNCLUTTERED

-SHELVES,TABLES ORDERLY

5S INSPECTION SHEET AT

ASHOK LEYLAND


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ASHOK LEYLAND


*DISCIPLINE

-DRESS AS PER REGULATIONS-SMOKING AREAS OBSERVED

-PRIVATE BELONGINGS STORED SECUREDLY

-REFRAIN FROM EATING IN WKPLACE

Improves efficiency of workplace

KEY BENEFITS of5s


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Improves efficiency of workplace

Improves overall appearance of company

Improves self-organization

Improves self-organization

KEY BENEFITS of 5s


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RESULTS IN A PLACE EASIER TOMANAGE

SMOOTH WORKING NO

OBSTRUCTION NO DEVIATION, NO PROBLEMS

B/C EVERYONE KNOWS WHERE THETHINGS ARE SPPOSEDF TO BE

KEY BENEFITS of 5s


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Health and Safety is ensured

Machine maintenance

Quality

Productivity

Lean Manufacturing

KEY BENEFITS of 5s


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TIME SAVING

QUICK RETRIEVAL

ACCIDENTS & MISTAKESMINIMIZED

INCREASES SPACE

CREATES WORKPLACEOWNERSHIP

KEY BENEFITS of 5s


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FOUNDATION OF ALL QC TOOLS

CONTINUOUS QUALITYIMPROVEMENT

LEAN MANUFACTURING

KINDERGARTEN OF QUALITYTOOLS & TECHNIQUES

VISUAL MANAGEMENT SYSTEM

KEY BENEFITS of 5s


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VISUAL MANAGEMENT SYSTEM

VISUAL CONTROL TO SEE THE

ABNORMALITIES SIMPLE SIGNALS THAT PROVIDE AN

UNDERSTANDING OF THECONDITION( NORMAL/ ABNORMAL)

A LOOK AT THE PROCESS REVEALSITS DIRECTION (RIGHT/WRONG)

KEY BENEFITS OF 5S


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GREATER PEOPLE INVOLVEMENT

INCREASED SUGGESTIONS

BETTER USE OF FLOOR SPACE REDUCTION OF WIP AND

INVENTORY

BETTER WORKFLOW LESSER MACHINE BREAKDOWNS


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KAIZEN

Pillar 3 - Kaizen


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"Kai" means change, and "Zen" means good (for the

better)

Kaizen Target : Achieve and sustain zero losses with respectto minor stops, measurement and adjustments, defects andunavoidable downtimes. It also aims to achieve 30%

manufacturing cost reduction.

Less Initial Cost

Aims at reducing losses in the workplace that affect the

efficiencies

PILLAR 3 -KAIZEN


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KAIZEN IS SMALL IMPROVEMENTSCARRIED OUT CONTINUOUSLY

STUDY LOSSES,ELIMINATE LOSSES

OBJECTIVE TO HAVE ZERO LOSSES,- OPER COST REDN,-INCR EQPTEFFECTIVENESS

KAIZEN TOOLS INCLUDE PMANALYSIS AND 5WHY ANALYSIS

KAIZEN


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PROCESS OF SYSTEMATIC,SMALL GRADUAL AND CONTINUOUSIMPROVEMENT THAT USES TECHNIQUES SUCH AS TPM,JIT,PDCA

SEEKING BETTER METHODS IN ACCORDANCE WITHREQUIREMENT OF ACTUAL SITUATION

KEY ELEMENTS OF KAIZEN INCLUDE ADAPTABILITY OFPROCESSES AND PEOPLE AND OPTIMISING EXISTING CAPACITIES

PEOPLE BASED APPROACH WHICH CENTRES AROUND PROCESSORIENTED THINKING

AIM IS TO ALIGN COMPANY FOR CONTINUOUS IMPROVEMENT

PRACTICES ELIMINATION OF 3M WHICH ARE MUDA-WASTEMURA-NONCONFORMITY TO QLTY,MURI-DISCREPANCY OFMETHOD OF DOING THINGS

ALIGNING COMPANY FOR CONTINUOUS IMPROVEMENT GENERATES PROCESS ORIENTED THINKING

TRIES TO SIMLIFY,COMBINE,ADD,REARRANGE,ELIMINATEACTIVITIES(SCARE)

KAIZEN


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DEVELOPS EMPLOYEES TO OWN

THEIR PROCESSES AND GENERATE

PROCESS ORIENTED THINKING

EFFECTIVELY TRAINS PARTICIPANTS

TO IDENTIFY ROOT CAUSE AND

PERMANENTLY RECTIFY PROBLEMS

TYPES OF KAIZEN


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GROUP ORIENTED

INDIVISUAL ORIENTED

GROUP ORIENTED KAIZEN


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KAIZEN IN GROUP WORK IS REPRESENTEDBY SMALL GROUP ACTIVITIES LIKEQUALITY CIRCLES

CALLS FOR PDCA APPROACH NANDDEMANDS THAT PEOPLE IDENTIFYPROBLEM AREAS IDENTIFY ANDANALYSE CAUSES IMPLEMENT COUNTERMEASURES TO RESOLVEPROBLEMS ATTHE ROOT CAUSE AND ESTABLISH NEWPROCEDURES

SMALL GROUP ACTIVITIES


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SMALL GROUP ACTIVITIES ARE INFORMAL VOLUNTARYSMALL GROUPS WITHIN DEPT TO CARRY OUT SPECIFICTASKS eg SAFETY, ZERO DEFECT,PRODUCTIVITY

ADVANTAGES OF SMALL GROUP ACTIVITIES ARE:-STRENGTHENING OF TEAM WORK

- BETTER COORDINATION OF ROLES- BETTER COMMUNICATION BETWEEN PLANNERS ANDEXECUTORS-IMPROVED MORALE-DEVELOPMENT OF MULTI SKILLS AND IMPROVEMENT OFCURRENT SKILLS-IMPROVED LABOUR MGT RELATIONS

-

HIERARCHY OF KAIZEN

INVOLVEMENT


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INVOLVEMENT

TOP MANAGEMENT

MIDDLE MGT AND STAFF

SUPERVISOR WORKERS

TOP MANAGEMENT


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INTRODUCE KAIZEN AS CORPORATESTRATEGY

PROVIDE SUPPORT AND DIRECTION FORKAIZEN BY ALLOCATING RESOURCES

ESTABLISH POLICY FOR KAIZEN ANDCROSS FUNCTIONAL GOALS

REALISE KAIZEN GOALS THROUGHPOLICY DEPLOYMENT AND AUDITS

BUILD SYSTEMS,PROCEDURES ANDSTRUCTURES CONDUCICE FOR KAIZEN

MIDDLE MANAGEMENT


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IMPLEMENT KAIZEN GOALS AS DIRECTED BYTOP MGT THROUGH POLICY DEPLOYMENT

USE KAIZEN IN FUNCTIONAL CAPABILITIES

ESTABLISH MAINTAIN UPGRADE STANDARDS

MAKE EMPLOYEES KAIZEN CONSCIOUSTHROUGH TRAINING PROGRAMS

HELP EMPLOYEES DEVELOP SKILLS AND TOOLSFOR PROBLEM SOLVING

SUPERVISORS


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USE KAIZEN IN FUNCTIONAL AREAS

FORMULATE PLANS FOR KAIZENS ANDPROVIDE GUIDANCE TO WORKERS

IMPROVE COMMUNICATION WITHWORKERS AND SUSTAIN MORALE

SUPPORT SMALL GROUP ACTIVITIES ANDINDIVISUAL SUGGESTION SYSTEM

INTRODUCE DISCIPLINE IN THE

WORKSHOP AND PROVIDE KAIZENSUGGESTIONS

WORKERS


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ENGAGE IN KAIZEN THROUGH THESUGGESTION SYSTEM AND SMALL GROUPACTIVITIES

PRACTICE DISCIPLINE

ENGAGE IN CONTINUOUS SELFDEVELOPMENT TO BECOME BETTERPROBLEM SOLVERS

ENHANCE SKILLS AND JOB

PERFORMANCE EXPERTISE WITH CROSSEDUCATION

KAIZEN STRATEGY


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MAINTAIN AND IMPROVE WORKING

STANDARDS THROUGH GRADUAL

IMPROVEMENT

DELEGATE RESPONSIBILITY OFMAINTAINING STANDARDS TO WORKERS

WITH MGT IMPROVING STDS

PRODUCE A SYSTEMS APPROACH THAT

CAN BE APPLIED TO REALIZING THIS

GOAL

PREREQUISITES FOR KAIZEN


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HIGHLY RESPONSIVE WORKFORCE

DEEP UNDERSTANDING OF BUSINESSPROCESS WORKFLOW RULES,OBJECTIVES, DEPENDENCIES

PROJECTION OF KAIZEN AS CORPORATEPHILOSOPHY AND VISIBLE IN STRATEGIES

ALL EMPLOYEES SHOULD UNDERSTANDAND BE INVOLVED IN THE DRIVE

SENSE OF PROCESS OWNERSHIP ANDCOMMITMENT

Small Group Activities


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ForEnergy Conservation

AtSHREE CEMENT Ltd.

Fundamentals of Small Group Activitie


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* Activities carried out voluntarily and

continuously by all members of small group

* The group sets its own goals (Requires

the support & guidance of managers).

* Guidance of superiors is taken to set goals.

Aim


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To improve the operation of the work place

in line with companys policy.

Basic Idea


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I) To develop work culture that is satisfying andfulfilling by raising workers capabilities and maki

effective utilisation of their abilities.

II) To create a lively and bright work place by respect

the human qualities of the workers.

III) To contribute to the improvement and developmenof the company.

Promotion of Small Group Activities


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Form the Circle

Decide the theme

Target & Plan

Evaluation of

Alternatives

Confirm

effect

Project

proposal

Management

Approval

Implementation

Analysis

Yes

Revise Plan

Incorporate

management

suggestion

No


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Shree cement ltd. has initiated SMALL

GROUP ACTIVITY under Green

Aid Plan Project (Bilateral Cooperation

between Govt.. Of Japan & Govt.. Of

India) in association with Bureau of

Energy Efficiency, New Delhi.

Benefits

Best utilisation of lower line capabilities.


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Ensure approach of lower line suggestions upto higher manageme

level.

Promotes leadership qualities & personal development.

Creates problem solving capability.

Inspires more effective team work.

Builds an attitude of Problem Prevention.

Promotes cost reduction through energy conservation &

productivity enhancement.

Develops harmonious relationship.

Reduces downtime of machines and equipment.

Increases employee motivation.

ENERGY POLICY

SHREE CEMENT LTD.


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y To reduce to the maximum extent possible the consumption

of energy without impairing productivity which should help in:

Increase in the profitability of the company

Conservation of Energy Reduction in Environmental pollution at energy producing

areas

y Since Energy is Blood of Industry, It is the responsibility of all

of us to utilizes energy effectively and efficiently

ENERGY SAVED IS ENERGY PRODUCED

Formation of 7 groups consisting of 5 to 6

Activities Performed at Shree Cement


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members in each group include operatingworkmen and supervisors in each section.

Leaders for each group have been selected.

Themes for energy conservation have been

identified.

Meeting with Technical Head is organisedmonthly to monitor the progress of Small Group

Activity.

*

Themes Identified By Various Groups


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Idle running of belts and crushers should be avoided.* Use of FRP type impeller.

* Appropriate size of motors.

* Use of Electro Static Filters in compressors.

* Use of fluid coupling orSMP coupling for power savingin all type of belt drive motors.

* Use of star- delta starter in hammer crusher of clinker coo

* Modification of raw coal hopper feeding arrangement.

* Removal of Insulation from pre-heater outlet to GCT inletduct.

SAVINGS

Savings in water consumption : 31.77 - 29.11 = 2.66 KL/Hr


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: 63.87 KL/Day

: 21076 KL/Year

Savings in power consumption : 1480 - 1460 = 20 KW

: 480 units/Day

: 1.58 Lacs units/Year

COST BENEFIT ANALYSIS

Total Investment Made : Rs 40,000/-


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Savings Due to Water Conservation : Rs 543 per day

: Rs 1.79 Lacs per year

Savings Due to Electrical Energy : Rs 825 per day

Conservation

: Rs 2.72 Lacs per year

Total Savings : Rs 4.51 Lacs per year

Pay Back Period : ~ 1 month

KAIZEN IMPL IN ASHOK

LEYLAND


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MATRL AND INFO FLOW REVIEWED

TIME STUDY OF PROCESS ELEMENTS

CYCLE TIME OF ACTIVITIES MEASURED

PROCESS PROBLEMS IDENTIFIEDANALYSED

GOALS SET FOR CHANGE

KAIZEN IDEAS DEVELOPED PLANS FORIMPL DONE AND IMPL

IMPACT OF KAIZEN MEASURED

REPORT ON ACHIEVEMENT

KAIZEN TRAINING AT ASHOK

LEYLAND


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CYCLE TIME OF M/C MEASURED

PROCESS PROBLEMS IDENTIFIED ANDANALYSED

KAIZEN GOALS SET FOR CHANGE KAIZEN IDEAS DEVELOPED AND

IMPLEMENTED

IMPACT OF KAIZENS ON PROCESSES

VERIFIED REPORT ON ACHIEVEMENT PREPARED


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ADVANTAGES OF KAIZEN


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ENSURES INCREMENTAL BUT CONTINUOUSIMPROVEMENT INQLTY,PRODUCTIVITY,SAFETY,CLEANLINESS ANDCAPACITY UTILIZATION

REMOVES DEFECTS USING ROOT CAUSEANALYSIS

REDUCES WASTE REWORK REJECTION AND LOSSOF ENERGY

OFFERS FLEXIBILITY AND REDUCES PROCESSCYCLE TIMES

LOWERS PROCESS COSTS AND LESSENS WASTE


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SAFETY

Pillar VIII : Safety and

EnvironmentTarget = Maintenance of peace of mind

Target = Maintenance of peace of mind


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226

Safety

ManagementEnvironment

Management

Zero Accident

Zero InjuryZero Pollution

Zero Waste

REMEMBER..

No job is so important and Noservice is so urgent that we


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227

cannot take time to perform ourwork safely.

SAFETY


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TARGET IS ZERO ACCIDENTS

FOCUS IS ON CREATING SAFE WORKPLACE

IDENTIFY ALL HAZARDS IN AN OPERATION ANDTHEIR PRECAUTIONARY MEASURES

INTRODUCTION OF WORK PERMITS ANDISOLATION CERTIFICATES WHICH WORK ASSAFETY PLANS WORKING IN CONJUNCTION WITHMAIN JOB PLANS

MAINT WORKPLACE CERTIFIED AS SAFE TOWORK AFTER ISOLATION, PRIOR TO WORKCOMMENCEMENT AND EQPT CERTIFIED SAFE TOOPERATE AFTER DEISOLATION

SAFETY


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PERMITS AND CERTIFICATES-COLD PERMIT-HOT PERMIT

-PERSONAL PROTECTION PERMIT-DRIVING LICENCE-CONFINED SPACE PERMIT-VEHICLE ENTRY PERMIT

-MECHANICAL VALVE ISOLATION-ELECTRICAL ISOLATION

Introduction to safety audits


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230

This orientation includes:SAFETY PROGRAM,

INSPECTIONS/AUDITS,

SAFETY MEETINGS,

HAZARD AWARENESS,HAZARD ABATEMENT,

ACCIDENT INVESTIGATION,

ACCIDENT REPORTING

PERSONAL PROTECTIVE EQUIPMENT

What is it?


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Similarities

It provides an external overview

It aims to confirm due propriety of internal procedures

Differences

It is Management initiated not a regulatory imposition

A principal aim is improvement, training and development

The downside is human suffering

Its a bit like a financial audit

Why do we have them?


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A duty of care to employees and neighbours

To reduce risks to the business of untoward events

Management being seen to be serious about safety

For consistent interpretation of management policy

To improve safety by training and development

Internal confluence of experience and ideas

Where in the overall safety

scheme of things?


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Tools for Ensuring SafetyMAJOR

HAZARDS

OPERATIONAL

INTEGRITYWORKPLACE

SAFETY

DESIGN

Hazard AnalysisRisk Analysis

HAZOP

Protection Systems

SYSTEMS

ProceduresReporting

Statistics

Support

ACTIVITIES

HousekeepingVigilance

Notification

Compliance

Health and Safety Audit

Inspection

Tour

Design

Team

What is the Auditor looking for?


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Throughout the process, the Audit Team

should be asking itself: Are Systems and Procedures appropriate and adequate?

Are Systems and Procedures correctly followed? Are the correct Documentary Records available?

Are the H&S Facilities and Equipment appropriate and adequate?

Is there a general awareness of Safety as an issue?

Is there a programme forsafety training?

What about evacuation procedures and mock drills for testingpreparedness

Could the organisation respond to a serious emergency?

Safety StatisticsTo be meaningful, statistics must be consistent and accurate


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Typical statistical analysis would include

Injury Frequency Rates Lost time, Medical

treatment

Injury Severity Index extent of lost time

Injury analysis - by type, location, worker

group

Central recording and analysis ensures consistency

Care with definitions such as Lost-time injury how many days?

Figures are only useful if lessons are learned and improvement targets imposed

Rigorous recording is essential

Procedures availability and

adherenceDefined procedures must be set down


23

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