Shruti Jire 511 Interim Report

8/4/2019 Shruti Jire 511 Interim Report

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INTRODUCTION

Crompton Greave is a much esteemed organization and I am working in its S-3 switch

gear campus. They have various departments like product design, marketing and sales,

procurement, inventory management, production plant, logistical operations, warehouse

management, quality management, IT, Research and development.

In this project I will be working in all of these departments in my training period. It

will help me learning all important functions of operations management throughout the

course of internship.

I will be learning Product Design and specifications, Procurement management -

Vendor selection, Vendor management, Inventory management -Scheduling, Stock

management, Buffer management, Process and production management -Process handling,Production planning, Layout and location, Logistical operations-Inbound logistics, Outbound

logistics, Packaging and labelling, Warehousing management-Raw material procurement,

Quality management-Quality checks.

Inventory Management Project and warehouse management was the live project we

were working on. Aim of the project was to reduce the current inventory levels using basics

of operations


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Basic functions of Operations

Product Design and Specification

Preface

Crompton Greaves work in two main divisions of product

We were working at Ambad Divison which has four major departments

y S1-

utdoor type instrumental transformers

y S2-Single pole Railway Appliances

y S3- Circuit Breaker.

y S4- ightning Arrestors.

We were working at S3 division.

Product

Consumer

Electrical

Appliances

ndustrial

Instrumental

Transformers

Circuit

Breakers

ightning

arrestors


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Product Range

CircuitBreaker

MediumVoltage

25KVInterruptor

25 KV GCB

33 KVSTD

33KV40 KA

72.5KV

72.5KV40

KA

High Voltage

145 SPDoubleStack

145 SP SingleStack

145 SP SPR

170SP SPR

170 GO

84" CAPSW

84" CSV

120" CSV

170 Pole

145 Pole

66 Pole

Extra HighVoltage

245 SP PN

245 SP SPSTD

400 KV WithPIR

400 KV w/oPIR


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Pro

ssforProdu

td

si

n andsp

ifi

ations

Switch Gear division totally works on customization. So customer requirements

are the highest priority for product design and specifications.

1. Custom

r:

As mentioned above, all the products are customized, the orders are as per the

customer requirement and specification, the order process would generally take place

from customer end by approaching the company for the required number of product.

2. Ind ntformat:

Generally, the marketing department receives the order indent from the customer

which includes all the necessary

y customer details,

It includes the customer name, the product type and the number of quantity

required.y product specification,

It includes all the precise details and in dept component list of all the

necessary items required for the customer for the required product

in a form of soft copy or SAP order.

Custom r

Marketin

department

y Produ

tdesi n

Department

y Produ

tion

y Testin

Indentformat

CC

Feedback

Feedback

Customer Order

Specification clearance


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3. Marketing Depart ent:

It is the department which acts as an interface between thecustomer and thecompany

for placement of the order of the product. Most often thecustomer initiates his order to

thecompany through the marketing department by providing the detailed information

and that detailed information is then CC to all other department. The other function ofthe marketing department is also to present its product catalogue to thecompanies

giving thecompanies a brief idea about their product and its quality.

4. Feedback:The feedback process includes the finalization of the design of the product from the

design department and then it issent to the marketing department so as to forward it to

thecustomer for the Final approval (Stamp Copy)so that the finalized design and

specification can besent to all the department of thecompanyto carry out the next

desired process.

Design Depart

ent Functions.

1. Preparation of Drawings as per customer requirements.

2. Sending the drawing to the marketing department.

3. Preparation on comments(Drawing restructure)

4. Release of Manufacturing Instruction to the Production, Planning and Testing

department.

5. Advance information sheet given to the purchase department.

6. SAP Maintenance (done by marketing department).

7. Production confirms.

8.

Cost Checking.9. Invoice

10.Discuss with R&D for new development.

11.To support testing.

Desgin Marketing Customer

Stampcopy(Final

Approval)

CC to allDepartment

Planningdepartment

Done only after SAP

Maintenance


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12.To Design a product according to GTA(Guaranteed Technical )

y General Information

y Guaranteed Ratings Circuit ratings, Electrical parameter rating, Temperature

ratings, Coils ratings, etc.

y Dielectric withstand ofcomplete breaker.

y Operating Mechanism.

y Data on SF6 Gas

y General dimensions

y Constructional details.

y Reference drawings.

y Validated operating conditions.

y Validated multiple uses.

13.They also release MI for particular product. MI is detailed manufacturing

Instructions.

14.BOM (Bill of material) is also provided by them

Procure ent function

After Clearance about Product specification from customer as marketing department sends

copy of indent to all departments. So after clearance about the design material

procurement playsvery important role.

Procurement department is divided into subdivisions according to the functions division

Vendorselection

VendorManagement

Purchaseplanning

Raw Material

Purchasing

Quality

Assurance


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As the product is divided into MV,HV,EHV.People working in this fuctions are also divided

accrording to product divisions and all of them have to take care of all of the functions

mentioned above.

Vendor Selection

This process is a online process.It starts on online portal of CG.Vendor who wish to provide

Raw material to CG apply through this portal.It starts with Form 0

Form 0

CG confirmationof

requirements

FORM 1 supplierinformation asper cg requirements

Evaluate

supplier

Form 2-Selfassessmentbysupplier

Evaluate Self

assessment

report

Form 2-AssessmentofsupplierBYCG representative

Suppliermeets CG

requirements??


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1. Form 0This form helps in Supplier introduction to CG. Basic Information about Supplier like

Name,

Material description,

Existing customer,

contact details,

Product details

2. CG confirmationofrequirements Material Manager of concerned division will confirm the requirement by approving form

0 of supplier. System will generate a reference number and will communicate to supplier

by email.

3. Form1Supplier accesses CG website with allotted login and password and submits required

information as per form 1.

4. Evaluate SupplierMaterial manager of concerned CG division will assess the information of supplier and

will approve the supplier for next process, if found suitable

System will communicate by email/SMS to the supplier the result of initial assessment.

5. Form 2Supplier will self assess their Quality system & decide whether they are meeting CG

norms for supply of CTQ or NON CTQ items.

6. EvaluateselfassessmentreportMaterial manager of concerned CG division will evaluate the self assessment report of

the supplier and will approve the supplier for the next process, if found suitable

System will communicate by email/SMS to the supplier the result of this assessment.

End

Samplelot acceptance


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7. Assessmentofsupplierby CGG representativesCG representatives will visit supplier works for assessment as per form 2 on a planned

date.

8. Finalevaluationofthesupplier Supplier will be approved based on score obtained in assessment. For supply of CTQ

items, minimum, *** rating is required.

9. Samplelot approval Supplier will send samples of the required item for CGG approval, before start of regular

supply

10.Pilotlot approval The first pilot lot (manufactured with full fledged tooling

will be monitored forperformance at CGG

11.Performancemonitoring The new supplier will be monitored for performance for first six months.

Quality Assurance

Quality assurance of each incoming raw material is a responsibility of vendor as well as

purchase manager.

33% of total cost of the raw material is levied on the vendor, if in case he fails to deliver

the raw material according to the decided quality and the entire lot of the ordered raw

material is sent back to vendor, so as to send the entire new lot of same raw material as

well as both side transportation cost.

Every new lot of raw material which comes in the company from the vendor is checked

at the stores and a random sample of the raw material is inspected for all physical

specifications and if any raw material fails the quality check, it is then and there rejected

and the entire lot is sent back to the vendor with the vendor liable to pay thetransportation cost.


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Vendor Manage ent

In CG, vendor management comprises ofvendor audits.

The integration ofvendors with CG is on contract and thesecontracts areyearly basis,

and renewed according to the overall rating which vendor gets from the auditor.

Everysix months there are qualitychecks which arecarried out and according to quality

reports, the ratings are given to thevendor.

Qualitychecks and Rating factor for thevendors.

Critical Performance Indicators are decided by CG policies


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According to the guidelines

y 1 = No evidence of system

y 2 = System awareness observed and implemented

y 3 = System is documented & fully implemented

y 4 = System is documented, implemented & periodically reviewedy 5 = Continuous efforts to improve the system

For Instance, if you want to rate supplier data it will be rated according to CTQ (Critical to

Quality

ratings.

For example:

If a vendor is given a rating of2 for its supplier data, then CPK (Critical Performance

Indicator factors

> 1.33 for at least 50% CTQ items in last six months for variable data.

Interpretation is that the data provided by t he supplier is not very reliable as it is varyingconstantly.

Documentation

List of documents required from Vendors

1. Company registration certificate.

2. VAT registration.

3. Plant layout.

4. List of major customers.

5. Balance sheet.(Financial documents!

.6. Factory license.

7. Copy of ISO certification(Optional !

8. Environmental Certification.(Optional!

9. OSHAS certification.(Optional!

Factorsfor vendorselection andretention

y Financial data.

y History and background of company.

y Cost of raw material.

y Delivery time.

y Manpower.

y Technological Potential.

y Plant Capacity.

y Availability of other vendor for CG.

y Geographical Reach


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Production Planning

Production planning is a very important function in operations. Planning of production is

done month wise. According to thecustomers requirement about the product delivery

the product isscheduled in production.

Planning departments receivescleared order from marketing then according to

following factors theystart planning and scheduling.

1. Plant capacit" y SAP hassheet about UEOB that is Un-Executed Order Booking. These are quantities

which areyet to be produced.

y Plant capacity is operated with MOST documents (Maynard Operation Sequence

Technique) which gives us information about people and project skill matrix.

Marketingdept

Productdesign

productionplanning

Plant

capacity

Materialavailability


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For Example,

According to order for the day to be made, workers on the basis of their skills and

knowledge work on particular division of product. Areas and processes are allocated

according to flow. If order is less for particular product, workerscan beshifted to other

product divisions. Skill matrix helps particular product range manager to utilize their

labours to the highest efficiency.

y CapacityIt is a Potential to produce a product.

Capacity utilization refers to the relationship between actual output from installed

equipments and potential output.

For current month it is100 Cr.

y According to financial data, following graph shows thecapacity utilization ofswitch gear

plant.

Quantit

MV

HV

EHV

0#

10 #

20 #

$ 0 #

40 #

50%

60%

70%

80%

90#

Capcity Utilization

2007-08

2008-09

2009-10

10labours 7labours

15labours


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y According to capacity they plan how many breakers per month.

2. MaterialA& ailabilit' MArefers to Available inventory. Inventory is divided into Standard and non standard items.

Requirement of inventory is decided According to production schedule and AIS (Advance

information sheet).

AISsheet provides information about all material available in inventory

According to daily plan, kits for each breaker are drawn from RM warehouse.

Logistical Operations

CG logistical operationscomprise of transportation only.

They mainly focus on inbound and outbound logistics.

Outbound Logistics is ofvital importance in CG as it dispatches its products to thecustomer.

Outbound Transportation

y Countrywide.

y Export.

OutboundLogistics.

Inbound

Logistics.


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Countr(

wide Logistics

This is a general process for thecountrywide transport.

Modes of transportation

y Road.

y Railway.

Most of thecases road ischosen as the transportation mode.

Following are the factors on which transportation mode isselected.

Reasons for selecting road as a transport mode.

Clearance for dispatch

confirmation from marketing that money is received

Permission to dispatch

Road and excise permit from Government given bycustomer

Arrangement ofsuitablevehicle

According to weight and dimensions of product the, suitablevehicle ischosen

It also dependent on trasport rate.


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1.

Factors Rating(5=highest,1=lo ) est)

Cost 4

Transit time 2

Reliability 4

Capability 3

Accessibility 5

Traceability 4

Total 22

2. The Cost of transportation increases as the product has to be first taken to the railway

station, loaded onto the railway, unloaded at the receiving end and then taken to the

customer end. This involves a lot of transportation cost.

3. Air mode of transport is not selected as the circuit breakers are heavy and its size as well

as length is quite large. Small Consignments as well at the time of urgency product issent through Air mode. It is the most costliest mode of transport as its charges are Rs.

200/kg.

4. Water mode of transport is the cheapest mode of all as it charges are Rs 5 -10/kg but the

coverage of water transportation network is not feasible due to geographical reasons.

99% of transport is outsourced to the following companies.

y Associated Root Corporation.

y Adhunik Transport.

y Premier Root Carriers.

y Shree Roadways.

Export

This division handles the outbound logistics ofNasik and Aurangabad Plant.

25 to 30% turnover of CG is from exports.

Two Modes of transport

y Air.

y Water.

Road


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Water Mode

Generally there are two ways ofsea transportation.

FOB (Free on Board0

This is a way of transport where the CG is not responsible for deciding the FreightForwarder

for the transportation of the Product.

The process on transportation in FOB is that, CG is responsible to send the product to the

nearest port that is Neva Seva port-Mumbai and then the product is handed over to the

Freight Forwarder who takescare of all thecustoms and excise duties, and then forwards it

to theshipping company to transport it to thecustomer to his desired port. Freight

Forwarder is responsible for thesmooth transport of the product right from the uploading

of the product on ship till it reaches thecustomer.

C1

F (Cost insurance freight0

In this type of transport, CG has the responsibility to decide the Freight Forwarder. The

process on transportation in CIF is that, CG is responsible to send the product to the nearest

port that is Neva Seva port-Mumbai and then the product is handed over to the Freight

Forwarder who takescare of all thecustoms and excise duties, and then forwards it to the

shipping company to transport it to thecustomer to his desired port. Freight Forwarder is

responsible for thesmooth transport of the product right from the uploading of the producton ship till it reaches thecustomer.

Sea Transport

FOB(Free onboard)

CIF(Costinsurance

frieght)


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Process of transportation through Water

Required documents for the transportation

y LC (Letter ofcredit) It is a letter from customers bank to CG as a assurance of the

payment of the product.

y DO(Delivery order for container) It includescustomer name, finished productweight, details ofshipping company

y ARE-I It is documents from customs which indicates that thecontainer issealed by

thecustoms, as in thecustoms has inspected it and approves it.

y Filing Shipping Bill It hasBill of Lading. This is a very important document as it is a

proof that cargo is handed over to Shipping Company, as in its now the responsible

of theShipping Company.

y Documents by CG Invoice, Packing list, Shipping Marks. Stuffing and Packing is done

by CG only because as it is good market reputation.

CG.

Port.

Freight Forwarder.

Shiping Company.

Freight Forwarder.

Customer.


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Qualit Manage ent

DivisionalQualit2

Polic2

y Setting quality objectives & goals for operations as per needs of Divisional business.

y

Manufacturing, supplying products and providing services as per the requirements ofthecustomer at minimum cost.

y Commitment and involving of all employees for promotion ofcontinual

improvement and customer focus.

y Planned training to employees, suppliers and customers of the Division.

y Planned management reviewscovering assessment of opportunities for

improvement and resources.

Qualit3

Divisions

Qualitysection is divided into four main parts bySix Sigma Drive

1. Input Qualit4 Assurancey All the incoming raw material is inspected before it is handed over to the

production department for carrying out production activity.

y The qualitycheck is done at thestores level.

y All the raw material go through a certain process which mainlyconsist of physical

check, critical component check, tolerance test which is done with the help of a

pre-defined tolerancechart, variouschecklist for different type ofcomponent,

hardness test which are or basically two types HRC and BHT hardness test,

spring test and all these test arecarried out through specified design parameters

for certain types ofcomponents.

QualityAssurance

Input QualityAssurance IPQ(Process) Predispatchqualitycheck After SaleServices


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y Every measuring instrument goes through calibration process once in a year and

every instrument has the last calibration date and the due calibration date.

2. IPQ(InterProcessQuality)y Six Sigma Drive has divided every process in the division into IPQ cells.

y The Cells are of according to the product ranges and process, each cell has its cell

owner and has the responsibility to ensure total quality for that product.

y During manufacturing of product, the errors which occur are noted down on

yellow card. All the major and minor error which occurs during manufacturing

are noted here.

y Not to Move card is placed on the breaker with defects and they all the non-

conformities are attended by that cell owner in Quality hour. Every morning

there is a Quality hour where all the issues related to quality are addressed.

y When all the error is rectified a card known as Read y To Test card is issued by

the production manager and it is placed the breaker and is ready for testing.y Major and minor errors are occurring in daily productions are taken up by the Six

Sigma department as a project and the solutions are standardized.

y Major Failures include Gas Leakage, Arcing Failure and MV Failure.

3. Pre-Dispatch Inspectiony In this section actual testing of circuits, components, physical and electrical

aspects of components and physical aspects of the breaker are done.

y Generally, each breaker takes minimum 2 days for testing.

y Physical Testing Lengths, Materials, Height are checked according to MI and

Drawings.

y Closing coil checks AC/ DC Circuits, Voltage etc electrical parameters are

checked for used coils.

y Component checks Physical and Electrical Specification are checked.

y Pneumatic Operations Component Resistance, Mechanical part, Wire Inter

phasing, Pneumatic Pressure. Etc

y After the entire testing process, customer verifies the tested produced so as to

meet his requirement. The verification is done at CG plant.

y After customer clearance, the breaker is sent for packing and dispatch.

4. After Sales Servicesy After the dispatch of the breaker and when the breaker reaches the customer, the

installation as in erection is done at the c ustomers end by CG representatives and

engineers.


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y Constant track of feedback record is kept by the after sales service team in order to

maintain quality standard in case of any post installation failures and for servicing

purpose.

y Number of after service sales department are set up across the country for providing

the post sales services and corrective actions in order keep a check on failures and

have a constant quality standard.

y Generally a breaker requires servicing after 10-12 years.

y Service department are categorized into main four regions

East Kolkata.

West Mumbai.

North Delhi.

South- Chennai.

y Every failure that occurs post sales services are go through CAPA action sub -module

(corrective action, preventive action5

which are predefined actions for failure

occurrence.

Head Office


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ASSIGNMEN 1-Operational Research

AIM

To know and analyze the operational efficiency ofvariousvendors for Crompton Greaves

Global. This will help us in managing and controlling inventorystocks levels at CG byknowing Vendors potential.

SCOPE

Research was performed on all local vendors available in Nasik. It involvesvisiting all local

vendors personally. There are totally 8 major vendors available in Nasik

Okay tools

Turningpoint

6 edarEnterprises

R.P.

Vivek

Hextech

MRC

Bunts ltd.

Vendor List


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METHODOLOGY

Methodology selected for data collection is Personal Interview

Interview session was arranged by Crompton Greaves only.

Reasons

PI helps in gathering information very fast. Respondent cooperation is very important in this

type of methodology. Flexibility of questions If the cooperation is good then Information

collected can be reliable. As we were supposed to perform research on lo cal vendors only

geographical barriers were not the problem. Vendors are situated in a locality of 1 -2 km

only.

So PI is the best suited methodology here.

MajorQuestions Asked were

We started with the list of Raw material they sell to CG.

a7 What are the raw materials components u sells to CG??

b8 Is CG your only customer??What are the other customers??

c8 How long you have been CGs supplier??

d8 What kind of integration you have with CG??

e8

What is raw material required for particular component??f

8 What RM Procurement time for each component??What is the Process lead time??

g8 What are processes involved in making of one component??

h8 What is labor count in one plant??

i8 What is companys turnover??What percentage of turnover it has with CG??

j8 Any Problems they get from CG side??


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Main Findings

Around 70 9 components are procured from local vendors.

Vendorscustomer

Year wise relationship

Integrations made with vendors by CG are all on Yearlycontractual basis;vendors

are approved and given ratingseveryyear through vendor audits.

0 @

20@

40 @

60@

80@

100@

120 @

T.P Hextech Kedar Okay tools Vivek R.P.

others

Semens

ABB

CG

0

5

10

15

20

25

30

T.P Hextech Kedar Okay tools Vivek R.P.

years

years


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Percentage of turnover from CG

Vendor complaints

Major turnover of all local vendors is with CG. This gives bargaining power to CG but

if not handled well power can shift to vendors as there are the onlyvendorsforparticular component.

0A

20 A

40A

60A

80 B

100 B

120 B

T.P. okay tools R.P kedar vivek Hextech

Series3

Series2

Turnover with CG

23A

43B

34A

Pr le

No Problem

Material Pick up

Frequent changes in schedule


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ASSIGNMEN 2: InventoryManage ent

Introduction

Inventory is a stock or a list of goods and materials which can be of following types

1. Raw material

2. Work in progress(WIP)

3. Finished good

Project AiC

To reduce Current inventory levels in stores

To plan new inventory levels and Decidea purchasing cycle for each component.

Project Phases

Phase 1

Secondary Data collection about all raw material componentsname,description,SAP codeetc divided into MV,HV,EHV .

Data feeding

there are more than 1300components.

Phase 2

Primary data collection through Operational Research

collection of Lead times ofeach component from vendors andpurchasing manager

Deriving consumption pattern for next quarter


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For exaD

ple:

For MV, Mech frame is used in 72.5KV and 72.5KV40KA, total averageconsumption for

month is123.Calculate EOQ, SS, minimum quantity and maximum quantity

Solution-

For EOQ,

D=123, ordering cost is negligible, Inventorycarrying cost as per given bycompany.

SQRT (2 X D X ordering cost)

EOQ=

SQRT (Inventorycarrying cost)

EOQ=12

For SafetyStock,

Lead time=30, Safety factor of 90E

=1.247, Avg STD deviation (calculated)= 2.0027

SS=SQRT (LT) x SF X STDEV

SS= 5

Phase3

Calculating EOQ,SS for each component

Deciding Minimum and maximum stock level ofeachcomponent

Phase4

According to Cost ofeach material we will becalculatingBudget for each quarter for keeping minimum stocklevel considering average month consumption.


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For Min level,

As we didnt want any extra Inventory for the day, we calculate

Min stock level as Demand

Min. level=

(21 that is working days of plantF

Min. Level= 123/21

= 5.85

= 6

For Max level,

Max. Level = EOQ

Max .Level = 12

Both Min and Max levels are calculated according to CG needs not Standard formulae.


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ASSIGNMEN 3: Warehouse Manage ent

CG has only a raw material warehousestore.

Main functions of warehouse G anage G ent are

1. Quality Checks of incoming raw material.

2. Placing the raw material in respective bins.

3. Keeping the record ofevery incoming entity

4. Making kits for particular product according to requirements and orders.

5. Giving hold up information of raw materials

6. Keeping and giving stock out information to supervisors.

Project AiH

To improve thestore processes and process management techniques.

To manage Inventory levels in warehouse.

Project phases

Phase1

Understanding thecurrent processes.

Analyse the processes.

Phase 2

Understand what all raw material isstored in warehouse

Classify them according MV,HV,EHV.

Then Classify them according to Processes they go through(ifthey go through) like planting,casting etc

After that according to weights heavy,medium,light Socollecting and lifting them from bins will beeasy for workers.


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Existing StoreI

ap

Phase3

Analysing the material flow ofstore it should besuch that once a labor putsa cart between two rows all material should be available to him in that placeonly ,so as to decrease his physical efforts and save time

Current processes in warehouse are not like this.everything is hotchpoch.

Phase4

After material flow management assigning bin numbers to each component

currently CG has bin cards whereentry of incoming and outgoing count iskept bt the work over there is all manual so mistakes in counts lead to extrainventory

Phase 5

Implementation

feedback about improvement


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Proposedstoremap

Proposedrackstructure


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REFERENCES

Websites

y http://en.wikipedia.org/wiki/Inventory

y http://en.wikipedia.org/wiki/Warehouse_management_system

y www.inventoryops.com/warehouse_management_systems.htm

y http://www.accountingformanagement.com/minimum_level_or_minimum_limit.htm

y www.cgglobal.com

Books

y Supply chain Management, Tata Mc Graw Hill