Final Sem Project Report - Copy

8/12/2019 Final Sem Project Report - Copy

1/22

A REPORT

ON

STUDY OF PRODUCTION PLANNING AND CONTROL SYSTEM IN EICHER

TRACTORS, MANDIDEEP

TOWARDS FULFILLMENT OF THE REQUIREMENTS

OF POST GRADUATE DEGREE IN MASTER OF MANAGEMENT STUDIES

OF MUMBAI UNIVERISTY

SUBMITTED BY

Sunil S. Gaikwad

MMS- ROLL NO: M1252

BATCH 2013-2014

UNDER THE GUIDANCE OF


2/22

, MMS (2012-14)

Fr.C.Rodrigues Institute of Management Studies, Vashi

i

FR. C. RODRIGUES INSTITUTE OF MANAGEMENT STUDIES, VASHI

STUDENT DECLARATION

I SUNIL SURYAKANT GAIKWAD, studying in the Second Year of Master of

Management Studies Course at Fr. C. Rodrigues Institute of Management Studies,

Vashi, Navi Mumbai, hereby declare that I have completed the project titled

Production Planning Control as a part of the course requirements for MMS

Programme.

I further declare that the information presented in this project is true and original to

the best of my knowledge.

Date: ________________

Signature of student

Place:


3/22

, MMS (2012-14)


ii

CERTIFICATE FROM THE INTERNAL GUIDE

I, hereby certify that Mr. < Student Name>a student for the Master of Management

Studies Course at Fr. C. Rodrigues Institute of Management Studies, Vashi, Navi Mumbai,

has completed a project on under my guidance during this year.

His work and output has been found to be satisfactory.

Date: ________________

Signature of guide

Place: Vashi


4/22

, MMS (2012-14)


iii

Acknowledgement

I take this opportunity to sincerely thank and express my gratitude to my guide, Dr.

R. C. Walke for him cooperation and inputs throughout the course of this project. It was

largely due to him help, support, esteemed guidance and encouragement that this project

could take shape and be completed. I thank him for giving direction to this project and

imbibing in an organized approach towards tackling the relevant problems.

I also thank the Head of our Institute Mr. Prakash Vaithilingam for giving us

freedom to work.

I am deeply grateful to my co-guide Mr. Srirang Joshi for giving a definite direction

to my work and providing crucial inputs throughout the project besides being a constant

motivating factor. I thank him for sparing him time in guiding me and assisting me in various

aspects of my work.

Finally, I would like to thank my family and my friends without whom it would have

been tremendously difficult for me to get through this project.


5/22

, MMS (2012-14)


iv

Executive Summary


6/22

, MMS (2012-14)


v

Index

Sr. No. Topic Page No.

1 Situation Analysis 1

2 Problem Definition 7

3 Literature Review 7

4 Methodology of Study and Data Analysis 9

5 PPC Process 10

6 Conclusion 23

7 Recommendations 39

8 Reference 46

9 51

10 52


7/22

, MMS (2012-14)


1

1.Situation analysis

Eicher Tractors, Mandideep

The Eicher Group started in 1948 when the Goodearth Company was set up to sell and

service imported tractors in India. Perceiving an urgent need to mechanize Indian agriculture,

the Company set up a tractor manufacturing facility i.e. Eicher Tractors Limited in 1959 in

collaboration with Gebr. Eicher, Germany in India. The first Indian tractor rolled out of

Eicher's factory at Faridabad in India, in 1960.

Today, there are over 4,00,000 Eicher tractors that contribute to the nation's agricultural

development. Eicher's manufacturing and marketing facilities located at Faridabad have been

awarded ISO 9001 certification.

Eicher Tractors has a technology transfer tie-up with Valtra, Inc of Finland. It has an

extensive network of over 400 tractor dealers and around 56 engine dealers across India with

15 regional offices and 12 depots.

Committed to providing high quality products, Eicher invests significantly in technology

resources and infrastructure. Our manufacturing facilities are spread across three states:Highlights

Wide range of tractors, from 61 HP to 24 HP offering the best value for money. Product range includes air-cooled and water-cooled engines. Highly fuel efficient machines, with low maintenance costs. Conforming to international emission norms.

Product range also includes engines in the 22 HP to 32 HP and gensets in the 15 KVA to 30KVA categories


8/22

, MMS (2012-14)


2

2.Problem definition

The study is to prove that the production planning and control practices has impact on theefficient utilization of the resources, waste reduction, reduce waiting time and processing,

thus contributing to the profitability of the industry. On these premise the study accentuated

to address questions in order to achieve the following objectives:

(a) To know how the production planning contributes to the efficient use of facilities and

equipments.

(b) To know the effects of Production Planning and Control on Production function.

(c) To know whether production planning and control practices lead to waste reduction

and increased profit.

(d) To prove that short term production planning and scheduling techniques employed by

industries, is necessary in minimizing process and customer waiting time.


9/22

, MMS (2012-14)


3

3. Literature Review

Tractor industry plays an important part as agriculture sector has a major contribution toIndias GDP.

Tractors are part of agricultural machinery industry. Tractors came to India through imports

and later on were indigenously manufactured with the help of foreign collaborations. The

manufacturing process started in 1961-62. Indian tractor industry is relatively young but now

has become the largest market worldwide.

There are currently 14 players in the industry. Mahindra & Mahindra is the leading player in

the industry.

Monsoon season is a key driver for sales of tractors. A series of good or bad monsoon can

affect the sales. In recent years the industry has registered a good growth in sales, both

domestic as well as exports. This is also partly because of the initiative of the government to

boost up agriculture and agricultural machinery industry.

The tractor penetration level in India is very low as compared to the world standards. Also

the penetration levels are also not uniform throughout the country. While the northern region

is now almost saturated in terms of new tractor sales, the southern region is still under

penetrated. The medium horse power category tractors, 31-40 HP, are the most popular in the

country and fastest growing segment.

4. Methodology of study and Data Analysis

Pertinent information is gathered from the respondents using a structured questionnaire. The

structured questionnaire is consists of descriptive questions to get the description of various

aspects of Production Planning and Control. The initial questions are to cover the variables

characterizing the various production planning and control practices such as demand

forecasting, inventory, capacity utilization, and scheduling techniques while the last segment

will purely on Control practices.

Unstructured personal interview is also conducted in order to augment the responses that may

not be explicitly cleared in the questionnaire. Like this the data is properly collected,

organized, and presented.


10/22


11/22

, MMS (2012-14)


5

Q2 Capacity plann ing contr ibutes to the effi cient use of f acil it ies and equipments?

I f Yes then how?

Options Yes No

Response 8 2

Interpretation

Most of the respondents i.e. 80% are in favor of the statement that capacity Planning

contributes to the efficient use of facility and equipments.

Proper Capacity planning leads to optimum utilization of capacity reduces idle time, under or

over utilization of capacity.

Response

Yes

No


12/22

, MMS (2012-14)


6

Q3. What are the main objectives of Production Planni ng?

a) Optimum Utilization of Capacity

b) Inventory control

c) Economy in Production Time

d) Ensure Quality

e) Waste reduction and increased profit

Interpretation

All the respondents believe that waste reduction and increased profit is the main objective of

production planning, some of them also believe that optimum utilization of capacity is

another objective of production planning.The other objective of production planning is

inventory control, economy in production time, and quality insurance.

0

2

4

6

8

10

a b c d e

Options A b c D E

Response 8 6 4 2 10


13/22

, MMS (2012-14)


7

Q4. ProductionPlanning and Capacity Planning are in terr elated?

If yes then how?Options Yes No

Response 7 3

Interpretation

Majority of the respondents i.e. 70% believe that production planning and capacity planning

are interrelated. Long term Production planning becomes the basis of capacity planning. Size

of production and type of production depends on capacity, hence both are interrelated.

Response

Yes

No


14/22

, MMS (2012-14)


8

Q5. Since, capacity cant always be added or subtracted instantaneously; there will be

mismatch of load and capacity.

What are its effects?

a) Lead time get affected

b) Increase in cost

c) Hurts the ability to satisfy customers

d) Other effects

Please specify other effects (if any)

Options a b c D

Response 0 9 10 2

Interpretation

Almost all respondents believe in the above statement. According to them mismatch in loadand capacity, leads to customer dissatisfaction and increase in cost. If the capacity is low and

demand is high, orders will not be completed on time. If load is less and capacity is more then

requirement it will lead to inefficient use of capacity, hence, cost of production will increase.

As lead time is calculated on the basis of available capacity it has no effect on lead time.

Other effects can be increase in cost by increasing man power and plant maintenance, and

delay in delivery to customers.

0

2

4

6

8

10

a b c d


15/22

, MMS (2012-14)


9

Q6. On what basis do you plan your production?

a) Customer needs (demand)

b) Target of Marketing Dept.

c) Resources available

d) Other factors

Please specify other factors (if any)

Options A b c D

Response 8 0 10 0

Interpretation

According to the data collected from the respondents the production planning of Eicher

Tractors, Mandideep is based on customer need i.e. dealers demand for particular models,

and also on the basis of resources available.

The marketing department reports to the PPC/Store about dealers requirements. PPC/Store

communicates with the material department about availability of material. Hence, market

demand and availability of resources is considered as base for production plans.

0

2

4

6

8

10

a b c d


16/22

, MMS (2012-14)


10

Q7. Do you feel or experienced hung up and bottlenecks in implementing

Production Plans.

a) Yes

b) No

If yes then what type of bottlenecks?

Options Yes No

Response 4 6

Interpretation

Majority of the respondents i.e. 60% are in against of the statement, hence, all the department

works in integration. Heads of all the department sits together and prepares plans which are

properly applicable.

There are people who experienced bottlenecks like- sequence change due to non availability

of material, and transforming one model to other due to requirement of specific model.

Response

Yes

No


17/22

, MMS (2012-14)


11

Q8. How do cur rent Production Planning and Capacity Planni ng methods account for

bottlenecks.

Interpretation

Current production planning and capacity planning highly depends on material available and

material in transit. The non availability of material and delay in transportation of material

hinders execution of plans properly. Due to this too many changes in daily and weekly plans

takes place.

Sometimes lack of coordination between PPC/Store, production department, and Quality

control department creates problem of rework and repair.

Q9. Previously what measur es have been taken to avoid such bottlenecks?

Interpretation

As the main source of bottleneck is timely not availability of material. So, proper care is

taken of the material providers, transportation of material, and inventory of material.

Following measures have been taken to avoid such bottlenecks:

Multiple vendors being developed for most of the items. Proper inventory level is being asked to maintain. Planning being done with the best availability of material


18/22

, MMS (2012-14)


12

Q10. I f resul ts are not according to the plans, what control measures are taken?

a) Revision of Plan

b) Any other measures.

Please specify other measures (if any)

Options Revision of Plan Other measures

Response 10 0

Interpretation

If the results are OK wait until next control period. If not OK, revision of plan is required tobe done. At present people of Eicher Tractors do not have any other solution except revision

of plan to control deviations in plans and results.

Response

Yes

No


19/22

, MMS (2012-14)


13

5. Production Planning and Control at Eicher Tractors,

Mandideep

Production plan is crucial to the success of any producing unit; it is an activity which is

continues in nature and required to be revised time to time as per the requirements. It cant be

done in isolation by a particular department; rather it is an integrated activity done by

Planning and Control Department in collaboration with Material Department, Production

Department, and Quality Control Department. The heads of various departments of Eicher

Tractors sits together and Plans there monthly, weekly, and daily production.

5.1 Process of Production Planning at Eicher

1. Marketing DepartmentMonthly details of Market demand

Production planning starts from the market details provided by Marketing Department.

Marketing Department provides there monthly requirements like- number of tractors, specific

models, specific color, capacity etc.

2. PPC/StorePreliminary Production Plan

PPC/Store receives message of monthly requirements from marketing department. PPC

studies the requirements and prepare a Preliminary Production Plan. This plan is sent to the

Materials Department.

3. Material DepartmentMaterial requirements planning

A copy of preliminary plan is sent to the material department. Material department studies the

plan and prepares a report which shows the availability of material, material in transit, plan of

receipt of material in chronological form, expected shortage of material, and any other

problem related to the material. Materials Requirements Planning (MRP) can be used in more

complex systems. MRP determines time-phased requirements (period-by-period) for all

purchased and manufactured parts such as raw materials, components, parts, subassemblies,

etc. . This report is sent to the PPC Department


20/22

, MMS (2012-14)


14

4. PPCRevision of preliminary Production plan.

On the basis of the report sent by material department, the PPC/Store revises the preliminary

plan. This revised plan is sent to the marketing department. Marketing department revises the

schedule of requirements according to the availability and sequence/schedule of receipt of

material.

5. Production Planning and Master Production Scheduling

After the consent of marketing department and material department the monthly Production

Plan and weekly master production scheduling is done. A copy of main plan and master

production schedule is sent to each department.

6. Daily Production Plan

Every day in morning the production head, quality head, and material head sits together,

discuss there problems, and unanimously prepares a daily production plan. This daily

production plan is displayed on planning board of every department and at every level of

assembly line. This daily production plan shows sequence of operations, sequence and

schedule of material movement, post pending material, pre pending material, and shortage ofmaterial. This daily plan is automatically get updated with the completion of operations at

every level.

7. Control

In results are not according to the Daily Plans, the plan is required to be revised. Daily

Production Plan is revised number of times considering the material shortages, problems with

assembly line, etc. if material is post pending i.e. on assembly line its operation cant be

changed, but, changes can be made in the sequence and scheduling of pre pending material

i.e. material in queue. Efforts are made to plan a sequence which minimizes the idle time of

assembly line, labour, and other equipments.


21/22

, MMS (2012-14)


15

6. Conclusion

After doing this project I am in position to conclude that Eicher Tractors, Mandideep has well

defined and structured production planning system. PPC defines the sequences and schedules

of operations; hence production planning contributes to the efficient use of facilities and

equipments.

PPC is done to identify production process which leads to reduced lead time; hence customer

waiting time is also reduced.

PPC ensures optimum utilization of production capacity, material, and other equipments;

hence it leads to waste reduction and increased profits.

7. Recommendations

The production planning and control of Eicher Tractors, Mandideep, highly depends on the

material availability. In case of shortage of material the overall plan get disturbed. If such

problem prevails the optimum results cannot be achieved. To avoid such problem following

measures can be taken:

a. Proper Materials Planning done,b. Materials must be purchased from multiple vendors,c. Sufficient safety stock must be maintained,d. Lead time and responsibility must be fixed at the part of vendors.


22/22

, MMS (2012-14)


16

8. REFERENCES

1. www.wikipedia.org2. www.tmtl.com3. www.eichertractors.in4. www.researchandmarkets.com
http://www.wikipedia.org/http://www.wikipedia.org/http://www.tmtl.com/http://www.tmtl.com/http://www.eichertractors.in/http://www.eichertractors.in/http://www.eichertractors.in/http://www.tmtl.com/http://www.wikipedia.org/

Documents

Final Sem Project Report - Copy