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7/30/2019 LSCM Project
1/25
SUPPLY CHAIN MANAGEMENT
of TATA MOTORS AND MARUTI
SUZUKI
SUBMITTED BY
Amar Jyoti (12PGDM128)
Ankur Chaturvedi(12PGDM131)Manish Kumar(12PGDM87)
Michael Mangalam(12PGDM89)
Subham Gupta(12PGDM111)
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OBJECTIVES OF STUDY
Study of vehicle manufacturing processes
from raw material to finish vehicles.
Comparision of supply chain management at
tata motors and maruti suzuki
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1 Indias largest automobile company, with revenues of US$ 34.575 billion (2012)
2Winning products in the compact, midsize cars and utility vehicle segments
3
The Companys 60000 employees are guided by the vision to be best in the manner inwhich we operate, best in the products we deliver and best in our value system and ethics
4Worlds fourth largest truck and second largest bus manufacturer
5The first company from Indias engineering sector to be listed in New York Stock Exchange
6
Subsidiaries are Tata Daewoo, Tata Hispano, Tata Technologies, Jaguar and LandRover
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Plant Location and production CapacityLocation Type of vehicle
manufactured
Production
Capacity(Lakh/PA)
Pune Passenger Cars (Indica,
Indigo, Marina, Indica Vista)
2.7 L
Pune Commercial Vehicles (MCVs
and HCVs, LCVs, Utility
vehicles)
2.5 L
Jamshedpur Trucks & Special Purpose
Vehicles
1.08 L
Lucknow Buses 0.6 L
Pantnagar(Uttarakhand) Mini Truck (Ace), PassengerCarrier (Magic)
2.25 L
Sananand Tata Nano
Hereafter we have limited the scope of study to a single location which is
Passenger Car Business Unit (PCBU), K Block, Pune
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Competitive Priorities for TATA Motors
1 Maintaining global standards to tackle competition
2
For luxury bus segment: its major focus is on the fully-built vehicle
delivery rather than supplying only chassis
3 Diversified suppliers, eg. NANO car has more than 128 suppliers
4
Sourcing through reverse auction which includes evaluating suppliers,
identifying new suppliers, leading to better supply management
5
To cut costs, Tata Motors tried innovative techniques such as zero-basedcosting
6
Believed in developing strong in house design, engineering, and
manufacturing capabilities
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Management Hierarchy of PCBU, Pune
HR
Formalized selection, evaluation, and payroll processes
Records basic selection, training and development, capabilities and skills management,compensation planning records etc.
Engineering& Research
Centre
The facility includes - improving Engine Performance, Reducing Emissions, Test Tracks, Designingand Styling and Safety
Technical &Productivity
Services
necessary technical assistance for smooth production in the plant
Functions includes setting up new assembly lines, seeking prospects for modifications in the
current assembly lines, etc.
Production
Group carries out production as per the production plan prepared by production planning andcontrol (PPC)
VendorDevelopmen
t
Small parts are outsourced to various vendors, due to various in-house constraints
Identifies the appropriate vendor and ensures proper quality standards
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Production Strategy Followed in TATA
Motors
Passenger Car Division in 'K' block executes the entire process ofcar manufacture over five shops
Engine shopTransmission
shop
Press and
body shopsPaint shop
Assembly
shop
1
The shops are fully automated ensuring that there is minimal chance for error in the
manufacturing processes
2Production Strategy being implemented in Tata Motors is Make to Stock
3
Demand forecast is done by the marketing team and accordingly a production plan is
prepared
4
The cars produced are tested thoroughly and after successful completion, they are stored
in large free space available in the company premises
5
Some special purpose vehicles such as utility vehicles for defence, mini-ambulance for
hospitals are made as per the order
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Plant Layout of PCBU, Pune
Machine Shop
Engine Shop
Press Shop
Paint Shop
TCF
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Quality Management
1 Has introduced cleaner engines
2
First Indian company introduce vehicles with
Euro I and Euro II norms
3
Manufacturing stage - regulars quality audits
held by in-house auditors
4
Post manufacturing -stringent testing standards
such as shower test, wheel balancing
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ENVIRONMENTAL MANAGEMENT
1
Reduce the emission levels of vehicles in full complianceof the regulatory norms
2
proactively work with the industry, Government, other
related industries & agencies to bring in internationalpractices
3
Conserve natural resources and energy by minimizingtheir consumption & wastage
4
Certified with ISO 14001 : 1996 for EnvironmentalManagement System (EMS)
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WORK MEASUREMENT
1
first Indian Company to introduce the Balance Scorecard System inautomotive sector in India
2
Balance Scorecard System - incorporates SQDCM (Safety, Quality,
Delivery, Cost and Morale)
3
Suggestion scheme - any employee irrespective of his cadre can suggest
an improvement in the work place ; if approved, employee gets rewards
points
4
Gift voucher for achieving certain number of points
5Bonus on certain festive occasion
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VALUE ENGINEERING
1 Continuous efforts are made to reduce the cost of
service
2
Rejection of input parts received from vendors -
closely monitored
3
Vendors penalised if rejection exceeds beyond the
defined limits
4
consumption of electricity, water, LPG, Compressed
air - continuously monitored ; steps taken to reduce
their consumption
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MATERIAL MANAGEMENT
Tata Motors uses SAP 4.6C Material
Management (MM) module for:
materials planning and control,
purchasing,
goods receiving,
inventory management, invoice verification.
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REVERSE ENGINEERING
Reverse engineering is a process bywhich the design of a product is
analysed or re-created using a
physical part or mock-up as a
starting point. This becomes truly
valuable when trying to extract thedesign intent from a handmade
model
Tata motors does reverse
engineering of its competitors cars
in an effort to constantly improve
on the design of its cars
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Problems identified
Waste management and hygiene issue
Major environmental wastes: machine lubricants and coolants;
aqueous and solvent cleaning systems; paint; and scrap metals
and plastics. Hazardous cleaning chemicals very common, requirespecial waste management arrangements.
Efficient utilization of Human resource
Efficient utilization of human capital is always a questionable task.On comparing the human capital utilization with that with the
best in the business, TATA motors was found lagging behind.
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Tools management
Lot of time wasted in tools movement from the stock to theshop floor. Whenever a tool is broken or is declared useless,
than the assembly line has to stop till the new
Unorganised flow path
The place for each item was not clearly labelled ordemarcated. Items not arranged in a manner that promotes
efficient work flow (eg : Workers had to bend repetitively to
access materials) Each tool, part, supply, or piece of
equipment was not kept close to where it will be used
Untidy shop floor with dusts in the weld shop and press
shop
Customer complaints and defects in products after delivery
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OUR RECOMMENDATIONS
Adoption of Kaizen
The Kaizen Management System addresses all aspects that
contribute to company results including quality, costs, logistics,
staff motivation, safety, technology
The entire process chain from supplier via the internal
customer to the final customer is therefore taken
available tools are used to eliminate all wasteful activities
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Adoption of six sigma methodology
6 sigma is a structured statistical methodology that can be
used to measure the quality of the service and performance.
6 sigma is 3.4 Defects per million opportunities(DPMO).
The accuracy is at a level of 99.9997%.
Six Sigma is a process improvement set of tools and strategies
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Device to clean foot - Before coming to the assembly
lines and the shop floors everyone should clean their
shoes
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Efficient utilization of space
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Focus on hygiene
Problems in implementing kaizan
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Problems in implementing kaizan
managementresistance
managers may find it hard to manage empowered workers
employeeresistance
this may occur, especially in situations where industrial relations have been
poor in the past. Employees may simply feel that they are being asked to do
more without extra pay
cost oftraining
- attitudes will need to change and the type of training required to achieveattitudinal change will be expensive and lengthy.
justifying thecost
the costs of implementing a kaizen programme, in terms of both training
and lost production, will be clear. The benefits will be unknown until the
programme is up and running.
Unfortunately there are a number of barriers that must be overcome in order
to implement a kaizen programme.