UNIVERSITY OF

GAZANTEP

FACULTY OF ENGINEERING
DEPARTMENT OF INDUSTRIAL ENGINEERING

Engineering Practice Journal

Mzeyyen Gl ABANUA
200849336

CONTENTS

INTRODUCTION

INTRODUCTORY FEATURES
o NAME OF ORGANIZATION
o STRUCTURE OF ORGANIZATION
o BREFLY HSTORY OF ORGANIZATION
o MAN SPHERE OF ACTIVITY
o ANALYSIS OF MACRO ASPECTS

QUALITY CONTROL POLICY

VISION

MISSION

FACTORS OF CHOOSING FACTORY LOCATION

R&D STUDIES

OVERWIEW OF THE PRODUCTION SYSTEM

PRODUCTION PLANNINGAND CONTROL SYSTEM

MANAGEMENT INFORMATION SYSTEM

C++ PROGRAM

WORK STUDY

CONCLUSION

INTRODUCTION
Summer practice was performed at ALARKO- Carrier between August 9 and
September 3. Main practice department was Air Condition Department. However we
observed the purchasing department.
Main scope of the summer practice was to observe the things that we have
learned in he lectures theoretically, visualize the main differences and real life effects
on the operations.. Most of the operations that is found very much simple at ideal
conditions may turn into a complicated job because of unexpected event of real life.
Another important scope was visualize the job environment. All department of
Alarko_Carrier are depend on each other and there is a table about link other
department Table1.An engineer in Alako_Carrier require getting ideas about
organization their expectation on employees and their utilization.
The main difficulty was getting some information for the practice report. Some of
them were confidental and employees hesitated to give them. The department
manager were needed to give the adequate information but , as they were so busy, it
was hard to find right time to ask question.
Although there were some problems to deal with, summer practice was very
useful. t was great chance to observe a production process from the beginning to
end in more detail. Also met new people and experienced in communication.
Summer practice was not easy but very much necessary and sometimes enjoyable
for any one to gain experience and to get used to business life.

INTRODUCTORY FEATURES
1.

Full name of the organization is Alarko Carrier Sanayi ve Ticaret A.

Full address of the organization is Gebze Org.San.Bolgesi (GOSB) Sahabettin

Bilgisu Cad. 41480 Gebze/Kocaeli/ TURKIYE
Mailing adress is www.alarko-carrier.com.tr .

2.
Starting from a single room office in 1954, as a co partnership between Ishak
ALATON and Uzeyir GARIH, ALARKO took its place within the Turkish industrial
sector. Its first activities were contracts awarded for central heating installations and
the manufacture of heating devices for industry. In 1956 and with a capital of 20.000
TL. ALARKO established a small work shop.
At the same time, the central air-conditioning systems for both, the Banknote
Printing Plant of the Central bank and the Malatya Textile Factory of Smerbank were
realized; with ALARKO using domestic products exclusively for both contracts. Other
contracts in this field soon followed.
Showing an impressive organizational and technical improvement, the capital of
ALARKO was first raised to 80.000. TL, then to 300.000 TL and then in 1962, to
2.500.000 TL. In 1963, ALARKO was transformed into a corporation with a capital of
3.500.000 TL. With credit from the Turkish Industrial Development Bank, ALARKO
proceeded to build a factory in Istanbul, in which it started to manufacture equipment
for beating, air-conditioning, pumping, etc. Being one of the first enterprises to have
constructed industrial plants in Turkey, ALARKO Inc. was transformed into a public
Holding Company in 1973, with a capital of 65.000.000. TL.
At 1998 Alarko got the partnership of

Carrier which was developed by the

inventor of air conditioners Willis H. Carrier . Carrier is one of the current companies
of United Technologies.
United Technologies ( UTC) is a $31 billion corporation that provides high
technology products and building systems industries through out the world. Other
companies that UTC owns are Chubb, Hamilton Sundstrand, Otis, Pratt & Whitney,
Sikorsky and UTC Power.

3.
Alarko Carrier Sanayi ve Ticaret A.., which is one of the largest companies of Alarko
company, is a public company with a foreign partner. Alarko Holding A.. and Carrier
HVACR Investments both holds same ratio of the shares .Alarko_Carrier is in service
of producing Heating, Air Continier and get Water Pressure Products at world market.

Activities of Alarko Carrier

Industry

Resorce&Development

Production

Trade and Marketing

o

Marketing and Sales

Resorce&Development

Export

Representation and Import

ALARKO CARRIER- INDUSTRIAL ACTIVITIES

Industrial activities of the Alarko Carrier are undertaken by the Gebze- Main Plant
and stanbul- Panel Radiator Plant.
Alarko Carriers Main Plant located on a site of 60.000 sq.mts. in the Gebze
Organised Industrial Area (GOIA) is the holder of the ISO 9001 certificate. The plants
production program for domestic and overseas market it as follows:

Natural Gas and LPG fired wall hang boilers- Carrier/ BLUE FLAME

Fuel-oil fired domestic boilers- Carrier/ HOT PACK

Air handling units- Carrier/ 39 HQ Series

Natural gas burners- Carrier/ ETNA 12 TG

Light oil burners- Carrier/ VEZUVIUS 12 TA

Medium and heavy oil burners

Circulation pumps

Finned coil

Pressure tank for a water supply

Submersible pumps and motors

within the framework of its research and development activities. Carrier

implements its program of product development and of becoming a global product
center in the area of air conditioning equipment.
Alarko Carriers Panel Radiator Plant located on a site of 18.000 sq.mts. and a
covered area of 9.250 sq. mts in the Dudullu Organised Industrial Region is the
holder of the ISO 9001 certificate.

ANALYSIS OF MACRO ASPECTS

Inputs

Outputs

Raw Material
Semi_Manufactured Materials

Finished Material

Labor

Semi- finished Material

Energy

System Results &

Machines

Information

Material Handling Equipment

Information

RAW MATERIAL

Sheet metal

Paint

Packaging material

Molded parts
Production system of Alarko- Carrier Gebze is mostly based on assembling the

certain product. 80% of the materials used for the products are semi manufactured
materials that are either bought from domestic market or imported from foreign
countries.
Organization finds it cheaper to buy metal in sheet form, shape and paint them
just before the assembling process instead of purchasing them in ready to assembly
form. Another benefit of this system is storing sheet metal is easier than a shaped
metal since the former one requires less storage area.
For the materials that are commonly consumed by all Carrier organizations
there exists a different purchasing pattern. At the end of every year, organizations
make their new yearly plans for the following period including production forecasts,
raw material ,energy requirements, possible investments and etc . For those common
raw materials, required quantities are transferred to the central office of Carrier for
purchasing. As buying any material in high quantities enables higher discounts,
organizations spend less money for these kinds of raw materials. For other materials
that are separately consumed, organizations act individually and find their own
retailers and make their own purchasing plans according to their yearly forecasts.

SEMI MANUFACTURED MATERIALS

Electronic parts and cable groups

Fans ,pumps and motors

Those semi-manufactured materials are either bought from domestic market or

imported from foreign countries. There exist several retailer options for every material
that enables the organization to choose the one that meets their requirements in both
quantitatively and financially.

LABOR
Labor can be grouped into two as white collars and blue collars. White collars are
consists of technician, engineers and officers. Most of engineers are graduated from
mechanical engineer departments of technical universities. There are 114 whitecollars employee 45 engineer.
There is only one Industrial Engineering graduate who zer Aknar his name. He
graduated from Yldz Technical University as industrial engineering at the same time
mechanical engineer. He works in Gebze plant as a Quality Control Engineer.
There are 247 blue-collared employee in the organization. They are either from
stanbul or Kocaeli . There are services for both white and blue collared employees in
order to make transportation easier. This high education level directly effect the
technical capabilities and the wages of the employees.

ENERGY

Electricity

Water

LPG

Propane

Fuel oil

Usage of the natural resources requires a careful plan for both environmental and
financial aspects. In order to maintain the required energy level, organization has to
make the allocation plans of the energy resources and balance their budgets. For a
better allocation plan, monthly usage amounts of every resource has been monitored
carefully for several years. According to the requirements of the production system
and the changes in the markets they make the yearly plans, identify their targets
quantitatively and monitor them in fallowing year.

MACHINERY

Finn Pres

Expander

Hairpin Bending Mach.

CNC

Painting machines

Test machines
Most of the machines are for forming tube and fin of the coils. Other ones are for

quality control tests that are occupied at the tests areas in the production area.

MATERIAL HANDLING EQUIPMENT

Forklift

Transpallet

Portable montage cars

It is not allowed in the organization to let the workers carry any kind of
products since most of the products are huge in dimensions or heavy. However,
while assembling the products it becomes compulsory to turn the product left or
right. Instead of making the worker turn around or let him carry and turn the
product , they use portable montage cars which makes it easier to carry and
make montage. Finished materials are carried either by transpallets or forklifts to
temporary storages or to trucks for deliveries.

INFORMATION
The listed inputs up to this point have a physical value addition factor to the final
products. However in order to have a smooth productions flow, it is required to have
a continuous information flow and systematic documentation at every step of the
production line. In Alarko- Carrier the documentation regulations are clearly identified
and continuously revised by the organization. Every documentation procedure moves
from general to specific. For example there is only one documentation cart for whole
production departments (contains every product) and specific ones for each product.
INPUT
Purchasing order
Purchasing data
Labor costs
Budget programs
ACE studies

SUPPLIER
Customers
Purchasing department
Accounting Department
Selling Department
Carrier - UTC

Product projects

Engineering Department

Most of the production plans are structured upon these inputs. However
there exists several steps of a specific production and it is essential to have the
same careful information transfer between these steps. For all of the products the
steps have been classified in five sections which are ;

Taking Order

Production Planning

Production

Storage

Transportation
OUTPUTS

Finished Material
Air Handling Unt
Rooftop Unt
Coil Shop
Panel Radiators
Circulation Pumps
Submersible Pumps
Submersible Motors
Natural Gas Central Heaters
Oil Central Heaters
Natural Gas Burners
Oil Fired Domestic Burners
Pressure Tanks
Water Cooling Towers
Chillers
Fan Coils
SEMI FINISHED MATERIALS

Finned coils

SYSTEM RESULTS & INFORMATION

After the completion of every planned production, new data becomes available
that includes the performance results of the system and the requirements for the
following run. Available data is classified in to groups and received by specific
departments in order to evaluate the system and prepare the necessary information
inputs for the next run. Again the documentation of those data becomes essential
for the flow and the control of the production system. The documentation procedure
is the same as the documentation of the information given as a part of inputs.
Some of the general outputs and the users of them are shown in table 2.2.

Table 2.2 . Outputs- Users of AHU Production

OUTPUT
Production Plans

USER
Sale Agencies

Purchasing Orders

Engineering

Department
Job Order

Purchasing

Department
Sales

Accounting

Department
ACE Results

Carrier - UTC

Rejected Parts

Customers

Inventory Level

Carrier -UTC

Before becoming partners with Carrier UTC, Alarko was producing great
portion of their goods for domestic market. In order to take a role on the foreign
markets they had to have some production advantages against their competitors like
low product prices or a very well known trademark.
Getting into the partnership with Carrier enabled them to get into the foreign
market with Alarko production and Carrier label. Carrier UTC was in the market of
air handling groups for a long time and a very well known trademark. However there
are some products that Carrier is not very much experienced and hesitated to give its
name on it. Those products are served to the foreign market under the name of
Alarko but there happens some problems. First of all, there is a certain prejudice
against Turkish products in the foreign market about quality and technical
qualifications. In order to prefer Alarko labeled products against the competitor ones,
customers demand lower prices from Alarko. However only way of price reduction is
increasing the production rate which seems risky because they would come up with a
high inventory level since there is no sufficient customers. So Alarko Carrier finds it
easy to make exports of the products that Carrier supports. In order to increase the

export rates of the other products Alarko tries to be a well-known mark and find the
ways of price reduction.
When exporting the goods labeling becomes important. There is no product
that has a name of Alarko Carrier on it. That name is used in order to represent
the partnership of two organizations. Products are either named as Alarko or
Carrier or served to the marked with no name. For example while roof tops and fan
coils are labeled as Carrier, panel radiators or burners may use either Alarko or
Carrier.
In the domestic market it becomes easier to make sales for Alarko since they
have been in this market for almost 50 years. Being a well-known trademark
enables them to have a sufficient market share. After the partnership and the ACE
studies, the production system of Alarko has shown a great progress in the sense
of efficiency and quality. The current market shares of the products and quantities
are

Market Shares and Production Quantities of Product

NAME
Air Handling Units
Circulation Pumps
Submersible Pumps
Submersible Motors
Natural

Gas

Central %9

Heaters
Oil Central Heaters
Panel Radiators
urners

A
ng to

MARKET SHARE
%40
%61
%25

QUANTITY
2000
50000
12000
500
25000

%18
%45

15000
22000

B Natural Gas Burners

%21
Oil Fired Domestic

220000

Burners
Filled Coils
Pressure Tanks
Water Cooling Towers

%5
%5
%40

Chillers
Fan Coils
Roof Top

14000
46240
5000
300
500

%37
%98exported

35000
1200

ccordi

financial and technological aspects, firm imports raw materials and intermediate
goods from other countries. They have agreements with most of the European firms.
They prefer Germany and Switzerland for electronic devices and Italy and France for
other raw materials. The ones that have agreements with Carrier may have priorities
and a single order is given for both organizations since firms give higher discounts to
the higher amounts of purchases. As a precaution to the unexpected situations there
exists different alternative suppliers for every type of material.
QUALITY CONTROL POLICY
There are two different types of quality assurance certificates in the firm. First
type is the ones that are taken for the all of the products and the production system.
The second type is taken for the specific products that are being exported to the
foreign market which applies some extra regulations. The general quality certificates
are:

ISO9001

OHSAS18001

ISO14001
Alarko-Carrier has applied the ISO 9001: 94 Quality Safety System since

1994 , later made some changes in applications when the standard was changed in
2000, and in October 2003 obtained to ISO 9001: 2000 Quality Management
System conformity certification from TSE and BSI. The first remarkable change in
the ISO 9001: 2000 version was in the name of the standard. The name which used
to be Quality Safety System in the ISO 9001:1994 version was changed to ISO
9001:2000 Quality Management System . This was also a way of expressing the
serious changes made in the quality system approach.
Other quality assurance certificates that are taken for specific products will be
introduced in detail at section 5 which is entirely related to quality procedures at the
organization.
Quality Control Certificates

Alarko Carrier is producing burners not only for domestic market but also for
foreign market. So taking ISO 9001 certificate is not enough. They should also
obey to the European standards which are obligatory to make exports to the
foreign countries and to be preferred by the foreign customers. So they have
quality certificates from Bureau Veritas Quality International ( BVQI) ( National
Accreditation of Certification Bodies ).

Since Alarko Carrier has a wide range of products they have each necessary
quality assurance certificate for them. All of the quality certificates that Alarko Carrier
is given below.

Quality Certificates of Alarko Carrier

Above all these certificates CE Certificate (Conformit Europenne ) may be

one of the most important quality criterions that enables and facilitates exporting to
European countries. What is CE certificate why does it necessary and the importance
of it is introduced by the organization as follows.

What is CE marking?
The CE mark is a mandatory European marking for certain product groups to
indicate conformity with the essential health and safety requirements set out in
European Directives. The letters 'CE' are an abbreviation of Conformit Europenne,
French for European conformity. The CE mark must be affixed to a product if it falls
under the scope of the approx. 20 so called 'New Approach' Directives. Without the
CE marking, and thus without complying with the provisions of the Directives, the
product may not be placed in the market or put into service in the fifteen member
states of the European Union and Norway, Iceland and Liechtenstein. However, if the
product meets the provisions of the applicable European Directives, and the CE mark
is affixed to a product, these countries may not prohibit, restrict or impede the placing
in the market or putting into service of the product. Thus, CE marking can be
regarded as the products trade passport for Europe.
The CE mark is not a quality-mark. First, it refers to the safety rather than to
the quality of a product. Second, most quality markings are voluntary opposite to the

CE marking, which is mandatory for the products it applies to. CE indicates

conformity with mandatory European safety requirements. European conformity is
certified by following clear and understandable procedures, the so-called conformity
assessment procedures.

MISSION:
Is to following the improvements of goods that they are serving to the world
market, converting those improvements into the service and high quality products as
fast as possible and to exceed the expectations of employees, shareholders and
customers
VISION:
Is to serve to the world market at Heating , Cooling and Air Conditioning areas
as a company that is closely cooperated with Alarko and Carrier who are the main
shareholders.
Factors of Choosing Factory Location
Most prevailing factors for selecting the current locations of the facilities were
directly related to the transportation facilities, government regulations and financial
aspects. Production has been made in two different plats. Old one is in stanbul mes
Sanayi Sitesi which was built over a total area of 60.000 m 2 and used for radiator
production. The new plant is in Gebze Organised Industrial Area (GOIA) and takes
an area of 18.000 m2 and responsible for the production and distribution of other
products. The old building was not sufficient for the whole production lines so by a
detailed investment project Gebze was chosen for the new plant location.
First of all, new building area should be far from the cities and living areas
according to the governmental and environmental reasons.Every production system
has some wastes that endangers the environment and has to be stored and
controlled.
Most of the time air and soil is the ones that are threatened more. In order to
minimize the harms of those wastes, production plants are located on areas that
have certain distances from city centers and organized in certain areas.

Exports and imports constitute the highest part of the purchasing and selling
activities of organization. Those activities are generated either by air or seaways. So
it is important to be close to harbors and airports. Istanbul offers so many possibilities
to organizations in the sense of transportation of finished or semi finished goods.
There were some disadvantages of choosing Gebze. One of them was the
transportation of the workers and officers to the plant because most of them were
living in stanbul and has to travel a distance of almost one hour two times a day.
There are services for the workers and officers that add extra cost to the system.
Addition to the cost, at bad weathers (most of the time in autumn and winter) travels
take hours because of the roads and traffic .
By considering the points that are mentioned above the organization had to
choose the most economic investment area for the new plant. Transportation and the
land costs were the ones that had to be considered in the first place for the financial
aspects. Alarko Carrier has four branch offices in Ankara, stanbul, zmir , Adana and
392 authorised dealers around Turkey that are involved in transportation of goods. By
making the required calculations Gebze was found to be the most suitable
alternative.
In Alarko getting the 50 % partnership of the Carrier at 1998 happened to be a
milestone for technological renewals and research & development studies. Since
1998 Alarko Carrier plant applies different procedures for different group of products.
Carrier group has been dealing with air conditioning and ventilation all around the
world for almost 100 years and has an extreme experience on the technical details of
the products. So for the air conditioning products technical developments, Carrier
has the greatest role. However for heating products and submersible motors and
pumps there are R&D studies that have been carried on by the plant.

PROCEDURE OF R&D STUDIES FOR AIR CONDITIONING PRODUCTS

The Carrier group has a great experience on air conditioning and ventilation so
they are the ones that are making the recent studies on these products. Most of the

time they send the technical drawings and the preliminary prototypes of the new
products. The R&D Departments are responsible for trying to the same prototype with
the example one and send it back to the Carrier in order to let them observe whether
they succeed or not to make the prototype.
R&D Department is not supposed to use the same material with Carrier
prototype; they are free to use any material that will suit . At the organization they are
trying to use local materials both for financial and national aspects because it is
cheaper and if Carrier finds the local material more effective they may start to use it
in their production lines too.

OVERVIEW OF THE PRODUCTION SYSTEM

In Alarko- Carrier special advisors and the department managers make the
overall capacity and efficiency plans. Every year the optimum production amount
and price is calculated. This amount gives the exact number and price that both
satisfy the customer and the organization. The technological capacity of the
organization is enough to meet this amount. However the market demand stands
very much below than this calculated numbers. So it becomes essential for the
coordinators to produce in smaller amounts that exactly meets the customer demand
but which takes the product prices to higher amounts and causes low utilization of
the plant. Instead of taking an overall theoretical value, managers prefer taking the
efficiency calculation in more specific manner and monitor the efficiency of the
production system on machine and overall equipment basis.

Overall Equipment Effectiveness ( OEE) : m * w * p

Net Working Time: Planned Working TimeSetup Time Machine Break Down
Short Stops

m ( Machine efficiency): Net Working Time/ Planned Working Time

w ( Work efficiency): ( Net Working Time Mat. or worker Problems) / Net Working
Time

p ( Production efficiency): ( # of Produced Parts # of Defective parts)/ # of

Produced Parts
In order to make the calculations above, the production planning officers have to
know statistical values for time losses (Setup Time, Machine Break Down, Mat. or
worker Problems) and the forecast values for planned working time. The values of
those time losses are collected daily ,stored at computers and turned into graphs at
the end of every month , year. Those charts that are named as Time Chart,
Available Time Chart and

Lost Time Chart which includes information from

general to specific are prepared by each production managers.

The production capacity of the organization is depend on labor and the working
hours beside the equipment effectiveness. The managers have to know whether their
labor (working hours) capacity is enough to produce the planned numbers of
products or not. In order to handle this problem, at the beginning of each year after
the forecasts are calculated the numbers are send to the Accounting Department.
Accounting Department multiplies these forecasted amounts with the statistically
known cycle times of the product to the find the required working hours. Then they
compare the actual working hours capacity of the departments with the desired
working hours for the following year and make the required worker, extra shift
allocations. Those calculations are made by Accounting Department since the
decisions based on either employing new workers or adding extra shifts are a part of
financial decisions of the organization.
In order to find the difference between desired and actual working hour capacity
of the organization, the number of workdays of each month is counted. Then the
normal working hour of each department is calculated by using those numbers of
workdays. The number of extra shift hours and lost times have to be considered in
the calculated too. There exist Extra Shift Coefficient and Lost Time Coefficient in
the calculations, which are known by statistical studies. After finding the usable

working hours capacity, it is compared with the actual capacity. If one department has
extra usable working hours and another one needs those hours, the former may give
one or two of his workers to the other department. If there is not chance like this the
problem is handled either by extra shifts or hiring new workers. The formulae of those
capacity calculations are given below .

Normal hour: # of workers * 9 hours * # of workdays

Extra Shift Hours: Normal Hour * Extra Shift Coefficient
Lost Hours: Normal Hour * Lost Time Coefficient
Work hours of one day: 8
Usable Working Hours Capacity: Normal Hour + Extra Shift Hours Lost Hours
Desired Working Hours: Forecasted Number * Cycle Time
Capacity Difference: Usable Working Hours - Desired Working Hours

In order to describe the production system of Alarko Carrier very well, the system
should break down into several units, which are responsible of different product types
and functions. Each product type and production department show different
characteristic based on standardization. So those groups should be identified first
and observed separately. However there is one thing in common between those
product groups. The production system of the organization is based on assembling,
which all of the semi- finished materials and raw materials that have been purchased
is assembled together manually step by step.
The most standardized products are produced by Heating Department that are
burners, central heaters, kombi boilers and for the products that are produced by Air
Conditioning Department which are chillers, cooling towers and submersible pumps .
No customer requirements are translated into the product. There are different sizes
( big, small , medium) and different types in source of firing (oil and natural gas). The
only chance of the customers to make a selection is for the size and fire source.

Each type has its own montage area. Every montage operation of any standardized
product has been divided into different operations. Since there happens to be high
volume, very standardized and repetitive production; the system for burners, kombi
boilers and central heaters are said to be an example of flow shop.
The highly customized products of the organization are air-handling units. The
standardized split air conditioners are not produced in the plant. The Gebze plant of
the organization has customers that need the air-handling units for the conditioning
the air of small sized plants or buildings. The size of the handling units change
according to the customer demand because the dimensions of the customer room
that the handling unit will be constructed can be very different in size. Although the
customer requirements play a great role on production, there are some limits in
dimensions that are based on the material capabilities. Those differences with the
customer demand and the limits are tried to be solved by making some meetings with
the customer and offering some options to him. For example the dimensions of the
handling units get larger as the expected performance area of the product increases.
In order to handle this problem more than one air-handling unit is employed. High
customization and low volume makes the system possible to put into the job shop
category.
Another type of highly customized products are roof tops. The main difference
between air handling units and roof tops are the dimensions. Although they are both
customized roof tops are very much larger than the air handling units. So whenever
an order is arrived any roof top has to be positioned fixed and the workers has to
assemble the required parts to it at that special area. Those products are the good
examples of project shop, which has fixed position layouts and high customization.
There are some special areas on the plant that are used for painting, bending,
grinding and etc. Although the assembling of all products are made manually those
jobs are automated according to quality, efficiency, health and capacity reasons.
Every machine or painting area is use for only one specific product. For example
there are different painting areas for burners and chillers. The most important reason
for that is the capability of the painting machines in those areas. Every part that will
be painted is hanged on the movable parts that pass through paint pools and ovens.

Weight of a chiller and a burner is very much different and the required movable parts
should be different in different sizes for both of the products. To sum up the
automated department of the plant are the examples of flow shop which serves to
standardized and high volume products.
Producing several type of products makes it necessary to apply several layouts
for the efficiency of the production system since the physical requirements of every
product is different from the others. It s possible to see all kinds of layouts in AlarkoCarrier since they have a wide range of products.
Process layout: Most evident characteristic of this type of layout is the grouping
of the similar equipment and operations in the same department. Products of those
departments is the movable element of this kind of layouts, the position of the
equipments are machines are fixed. Although
Carrier Gebze is based on the assemblies

the production system of Alarko( that product layouts are more

preferable), process layouts are applied too. Main departments that prefer this kind of
layout is the ones that are not dealing with montage or assembling of the materials.
Painting, grinding or cutting departments are arranged so that all similar equipments
that are making changes on physical appearances of products and make them ready
for the following assembly operations are grouped together. All those departments
are fully automated and placed nearby the related departments to them.
Product Layout: For the production system of Alarko-Carrier Gebze, this kind
of layout is the most applicable one since assemblies are employed for the
production of the goods. The system starts with taking he first raw material from the
storages and assembling the required part to it. All the production steps are made by
manually. The only automated part is the testing step since a better result and quality
analysis of the assembled material can be reached by machines and specialized
equipments. That kind of layout is preferable for the highly standardized products
because it is not possible to chance even the sequence of the operations or the
physical properties ( dimensions or colors) of the products. Burner, kombi boilers or
submersible pump departments are good examples for that layouts.

Fixed-Position Layout: For the assembly of the huge products, fixed-position

layout is the most preferable one. Since it is not easy to move the product, machines
and equipments are carried near by the product. So the movable element of this
department are man and machines in stead of product. The departments that are
using this layout are the ones that are responsible for production of roof tops and big
air handling units. Not only the big dimensions of the products but highly customized
parts can be shown as the common property of the products. Especially the air
handling units are the most customized ones.

PRODUCTION PLANNING AND CONTROL SYSTEM

Forecasts are the most important parts of the production planning activities at
the organization. Whole plans related to the budgets, raw material purchases ,cost
and time schedule are arranged according to the forecasts. Especially the raw
material purchases is very essential since any stock outs will actually cause the
stoppage of the production system and loss of money, customer reliability and
satisfaction.

Alarko Carrier Gebze plant is holding minimum finished good inventories in

their plants. Their policy is to take the customer order and produce the product as
soon as possible and deliver it. This system enables the organization to tie lees
money up to the inventories and has a continuous cash flow. However the most
important requirement of that system is the necessity of holding raw material and
semi finished material in order to give a quick response to the customer orders. To
make that system advantageous in financial aspects, making very accurate forecasts
is the most important step since under estimations will cause purchasing less
materials and stoppages to production system and over estimations will cause
inefficient money and storage area usage. In order to have a smooth production
system the organization should build up pyramids which the forecasts are the
bottoms , final products and feedback results are the top through careful production
plans.

One of the most important purpose of forecasting is to have the required

production plans for scheduling and inventory holding policies For example in order
to make a weekly plan of any product a fluent information flow is required through
dealers to the top management of the plant that is based on the forecasted values.
First of all at the beginning of every year the branches sends Sale Plans to the
organization which includes the regional sale estimations that are made by the data
collected from dealers. By considering those estimations ,part years production
amounts, target inventory levels and market behaviors; the production chiefs of every
product makes the required yearly forecasts .

After the completion of forecasts they give them to the department production
managers. According to the next years cost estimates and the forecasted production
amounts, department managers prepare the cost figures of

turnover and cost

amounts. Those turnover and cost values makes it possible to prepare first cash
allocations and send to the plant managers. Plant manager makes the analyses of
that information and prepares the new purchasing policies for the raw materials and
revise the old information related to the policies. If every data is approved and formal
documentation is completed, The production managers and the chiefs turn that yearly
plan into the weekly plan and enter the data to the computer system.
Decision mechanism of the plant has already been chance since the 50%
partnership of Carrier-UTC is taken. Before getting the partnership, all decisions
related to the products was taken by the plant management. However all these taken
decisions require some financial sources to apply to the organization. The approval of
those financial plans and the allocation of the money was made by the top
management of the Alarko. According to the allocated amount of money new
decisions were taken and applied to the production system of the organization.
However after the partnership Carrier is closely interested with the type of products
and the production plans. Currently, there are two decision groups who are related to
the decisions of products. Those are

Top managements of Carrier-UTC and Alarko

Plant management
Top managements of Carrier-UTC and Alarko : UTC is a big company that

has a number of branch companies all around the world and serves a wide range of
products. Scorsky helicopters and Carrier are one of those branch companies with
great capitals. Carrier has been dealing with air conditioning and ventilation and dealt
with Alarko to continue their production plans together both in Turkey and all around
the world. Although Gebze plant is producing also heating and cooling products,
Carrier is only interested with the air conditioning equipments and has a right to take
decisions regarded to them.
Carrier has factories all around the world that both make imports and exports
and has various kinds of product. So the top management has to make the allocation
of their products production percentages to for those plants, which will satisfy them
financially. Technological capacities, costs, export and import capabilities of those
plants are some of the properties that are being investigated. Another important
checkpoint is the ACE level of the organizations.
ACE is a continuous improvement strategy which can be used to improve the
quality and productivity of manufacturing and business process. This strategy is
implemented by offering a set of tools. ACE tracks a set of key business metrics that
are common to all Carrier sites ad used across all UTC divisions. There are four Ace
levels that shows the success levels of organizations in implementing the strategy
and improvement lee which are Qualifying, Bronze, Silver and Gold. While giving the
production rights of a product toa plant Carrier considers the Ace levels of the
organizations and choose the one with the highest level For example, Carrier has
already stop productions of roof tops at other plants and give the 100% production
right to the Alarko- Carrier plant. Similarly they may take this production right back
from stanbul and give to another plant.
Of course while taking those decisions they have to have a meeting with top
managers of Alarko and take their points. Most of the time the financial interests of
both organization meet at the same decisions. The decisions belong to the capital

investment of new these technologies and new products are taken by both
organization top managers. The required approvals are a part of those meetings too.
So for the air conditioning and ventilation products Carrier has the right to say
what to produce and how much to produce yearly.

Plant management: For the other products of Alarko Carrier, members of

plant management are the decision makers. There are three main decision groups
for that kind of products which are
o

Ones that require no improvement

Ones that need improvements

New products at design stage

Decisions related to ones that require no improvement is the easiest among the

other groups. Main data source for those products are the forecasts.At the beginning
of every year production chiefs make their forecasts according to their personal data
sources. The management arranges meeting that those forecasts are argued and
investigated whether they will manage to sell that amount of products. After the
approvals of the decisions the weekly production plans are made and production
starts.
For the products that need improvement and for the new ones at design stage
Research and Development plays the greatest role. They make market analysis and
the required technical development according to the desires of the production chiefs
and managers. The detailed explanation of how the procedures are implemented in
R&D department is given at the question 2.4. After the technical improvement of the
products is completed, according to the customer questionnaires, capacities and
market analyses the production officers arrange meetings and decide on how much
to produce. Again the approved decisions of plant manager is send to the top
managers of Alarko and Carrier groups and according to the financial and technical
advantages of those decisions, the investment necessary money is allocated to the
plant.

All the production plans and detailed planning of the materials are exactly for
the efficient and careful usage of the scarce resources.
Money or capital is the most important thing for the continuity of any
organizational function and the more they earn money , the more organizations are
satisfies financially. So it can be said that scarcity of this resource comes through it
importance At the end of every department at Alarko-Carrier Gebze prepares it
investment plan for the following year and calculates the budget. Those budgets are
send to the top managements of Alarko an Carrier to get the approval. Most of the
time, the approved monetary amount is lower that the desired one. So department
managers has to make the allocation of the limited very carefully and give priority to
the ones that needs it most and the ones that will have more beneficial outcomes for
the organization.
Another scarce resource is the natural resources that sustain energy to the
organization. Careful planning of those resources is not only important financially but
also important for environmentally. There exists no current limitation for the plant that
is applied by government. However continuous improvement is very important for the
organization so any current usage amount is not sufficient for them hey should try to
reduce that amount and improve their production system. Another important factor is
the ISO 14001 which is about natural resource usage. In order to keep that quality
certificate organization has to act very carefully. Current amounts related to some of
these resources is given at graph 2 and 3.
Labor is also important for the organization and requires a careful allocation.The
production range of Alarko- Carrier Gebze is said to be very wide and they havea
limited amount of workers in their plant. They have to make such a plan that they will
meet the customer needs. Efficiency measures of workers plays a great role while
making those plans. The target production amounts are reached at Heating
Department by allocating these workers to the different assemblies and by reducing
the worker the efficiencies of the worker are increased.
Current area capacity can also be named as scarce There exists a customer
demand for different kinds of products and new assembly lines should be constructed
in order to profit that market demand. For example constructing a new assembly line

for panel radiators is one of the investment plans of the organization. However there
exists no area for the new assembly line in the plant. Either the production area of
the plant will be enlarged or a new arrangement at the current plan of the plant will be
made. The decision will be taken by top managers of Carrier and Alarko. Making all
the required feasibility studies will take time and this will cause monetary loss since
they can not profit the opportunity. If the capacity of the organization were not limited,
it will take less time to take action.
Raw materials at the inventories are scarce resources too. Especially the
imported ones since the arrivals of those materials take at least days or weeks. By
the forecasts that are prepared at the beginning of every year the purchases were
planned by the organization. Because of unexpected event or orders they may get
into the trouble of material shortages. So they must carefully plan hose material
usages, control the inventories and be ready for the unexpected sales.
At Alarko-Carrier yearly improvement plans and target reports are being made
since they started to ACE. Those plans are the routine regulations of ACE and are
almost compulsory for getting higher levels. The reduction of the usage of the scarce
resources can be maintained by these detailed works. At those report what to do how
to do how much reduction to expect and who to deal with is directly given
There exists no exact measurements for the allocation of those resources in the
organization. However some measurements can be proposed and some of them are
given below.

Scrap cost or amount/unit

For cost and inventories

Raw, WIP,Finished good inventory turns

Profit/area

For area utilization

Profit/Cost

For monetary benefits

For inventories

Those measurements can be used for the usage of the resources that are
named as scarce. First measure will give the scrap amount per unit o scrap cost per
unit of the product. Raw materials may be used for the ones that will give higher

finished goods with less scrap or less cost of scrap. This measure will give
information both about the cost and the amount of the raw material wastes. However
the profit per unit of the products should be calculated too while evaluating that
measure because it will be nonsense to produce the one with higher profit less.
Second one may inform the management about how to utilize the inventory areas.
Since there exists a limited area for inventories they may utilize the area by putting
higher amounts of the ones which has lower inventory turns. This will both prevent
material shortages (since material in inventory quickly reduces), maintain quick turns
in inventory and prevent the firm paying all costs related to transportation each time
and tying up less money to inventories that stands for long time. Another measure for
area allocation can be the third one. There are certain amounts of areas that are
given to the different types of products. By dividing total profit earned from one
product by the area separated for it, it can be seen how the area is utilized financially.
They may give higher amounts of production area to the one that has greater profit
turns.
Fourth one shows how the profit earned by one product is offsetting the cost.
Higher profit per cost ratios may show whether the cost paid by the organization is
turns acceptable amounts of profit or not. All those measures gives ideas about
usage of the scarce resources like inventory, area, capital and raw materials. There
can be numerous measures found in order to monitor how beneficial is the current
allocation of scarce resources is being made.

MANAGEMENT INFORMATION SYSTEM

Computers are widely used in processing data and providing information for
managerial decision making in the organization. One of the greatest advantages of
employing computers is their speed in processing and storing data. Great processing
speeds reduces the required times for documentation and routine operations. Huge
storage capacities enables observing past data easily and quickly. They facilitate

data sharing between numerous departments that eliminates manual efforts.

Reduction in the necessary operation times makes it possible for he officers to
allocate more time on serious decision making activities.
In Alarko Carrier all of the officers have computers that are allocated to them.
In order to have the required maintenance operations of computers and make the
necessary set ups and arrangements there is a Information Systems Department in
the organization. Department manager is directly controlled by plant manager. There
are two officers who are working at that department. One of them is technician and
the other is functional expert. They are responsible for all data processing activities in
organization, making routine maintenance activities and investigating for possible
system improvements.

There are 12 servers.

230 stand-alone PCs (nearly 128 MB RAM, 2 GHz processor; 15 inch screen ;

Compac, Dell and IBM)

30 lap-tops (256 MB 333 MHz RAM, 2.8 GHz processor; INTEL Pentium4)

160 printers( 3 of them Xreox 5455 that works through network others are HP )
In Alarko Carrier information systems activities are executed by AS/400

mainframe and MAPICS /XA package program. Organization has been using AS/400
since February 1996. Before AS/400, System/36 was in charge however its capacity
was almost 600 MB and its speed was very low. AS/400 is much more faster than S/36
and has a capacity of 4 GB.
All PCs are attached to AS/400. There happens to be two updates at midday and
at evening. These updates are for the towing and recording the new data entries to the
main memory.
MAPICS/ XA is a special computer program for Production Accounting and
Control developed by IBM

for production organizations. There are 18 different

application modules of that program and system support module ( which enables the

interactions between modules). However Alarko- Carrier is using only four of them and
the system support module.Those modules are
o PDM (PRODUCTION DATA MANAGEMENT)
o IM (INVENTORY MANAGEMENT)
o MRP (MATERIALS REQUIREMENT PLANNING)
o PCC (PRODUCTION CONTROL & COSTING)
o CAS System Support Module
Detailed explanations of first four modules were given at the previous parts of
the report. Those modules are being used almost every production departments,
purchasing marketing exporting and so on. It becomes extremely important to
implement a data sharing process between those departments because their
functions are all related with the others.
In Air Handling Department the production planning and inventory controls are
being made on computers expect from watching market attitudes and deciding on
new product types. Those decisions can be classified into two. First of all, At the
beginning of every month the production chiefs and the department managers
arrange meeting in order to decide on how to implement the current plans on agenda
which was roughly identified at beginning of the year. Those decisions can be related
to allocation of resources, layout decisions or product type decisions. Level of this
kind of decision making can be named as tactical. Secondly those plans are
implemented day by day under the control of production chiefs. They make the
necessary allocations and response to the sudden changes. Officers who are
responsible from inventories, monitor the current customers and orders and the latest
condition of the inventory level. At any probable stock out situation she asks to the
production chief for opening a new order and inform purchasing department through
the computer in the case of the approval of opening an order. Everyday detailed
information related to products ( how much produced, assembled, rejected or
delivered) and workers ( any injuries , working hours) arrive to the department and
stored at the computer system. All those information is considered and the necessary

allocations are made, required precautions are taken by the department. So second
level of decision making activities can be said to be operational level.

Organization is using Microsoft. 60% of PCs are using Windows XP ( R&D ,

Information Systems , Accounting) , 30% using Windows 98 and 10 % using
Windows 2000. Current general computer programs on PCs except from standard
office programs are
o

SQL server

Anti-virus program

Microsoft Exchange ( mails )

Proxcy (internet)

Back up(production)

Back up ( management)

Back up (R&D)

As/400 (production)

UNIX ( management)

AutoCAD (R&D)

Telephone exchange (Siemens)

Voicemail
Most common program is MAPICS which is employed for production planning

and inventory control. Three modules ( PDM, IM, MRP) has already been introduced
for explaining inventory planning activities. However PCC is also playing a great role
on production planning by recording working time entries everday and storing them.
By this modules cost accountings, inventory control, production control,
purchasing, forecasting and analyze studies can be made. As some of the modules
works alone, some of them works with a high collaboration with others. Besides ,
because of the arising need Information Systems Department has prepared special
programs that works together with MAPICS and tried to answer the problems of the
organization. Those programs are

COST ACCOUNTING

This programs works by daily transfers of storage arrivals/departures and man-hours

from MAPICS.

DELIVERY TAKING
1. Transfers the data related to open production orders and purchasing orders
2. Departures of External workshop dispatch lists
3. Arrivals of dispatch lists from External Workshop and Purchases and printing
certificate of delivery
4. Directing orders at MAPICS storage arrivals

DEALS

Contains the agreed costs of materials bought from either External Workshop or
Purchased

IMPORTING MRP

EXPORTING MRP

AS/400

Supplier

Inventory Control
MRP
Billing delivery certificate
Reorder
Opening
Storage
Arrival
of
order
transfer
material
forof to the
Printing
the
certificate
Quality
Entry
toControl
the
storage
Approval
purchases
delivery
plant
certificate

ALVIMA

Opening order+ Approval

of order
Billingthe
debit
note and
Printing
approval
Manipulating
cost
printing
Preparing
order transfer
form+ TL
Storage
entry
accounting

Representation of Ordering Storing And Accounting Activities with AS/400 and

ALVIMA
C++ Program
I determined to create a program about Air Handlng Unt materials.The program
work as material tree. Chosen options determine material list.

This Program code is in appendix 3.

Work-Study
Present Method:
Proposed Method:
Definition of job: Hairpin Bending Machine
Elements of Job

Symbols

1.First Moving to reference point

Material :
Operator :
Time
Distance
(SECOND)
(m)
6

2.To drive forward

3. Cutting&Bending

4.Push Back

5. Turn Back

6. Storage

Method
Offer

1000mm
1000mm

MAN MACHINE CHART

Operation

Operator

Machine

CONCLUSION
After this summer practice I have learned that the theoretical is more difficult than
practical in engineering. I tried to use the informations which l had learned in lessons.

In addition, I tried to observe the organizational structure of the company. I believe

that it is very useful for me. I learned many things by the IE299 and I have written the
technical learning in the report but in addition, I recognize that the industrial
engineers and how is a factory environment. I think that it will be useful for me to
have some thoughts for the future.