2.

4 Process Planning
A process is a sequence of activities that is intended to achieve some result, typically to create added value for the customers. Types of Processes: (i) Conversion Processes i.e., converting the raw materials into finished products (for example, converting iron ore into iron and then to steel). The conversion processes could be metallurgical or chemical or manufacturing or construction processes. (ii) Manufacturing Processes can be: (a) Forming Processes, (b) Machining Processes and (c) Assembly Processes. (iii) Testing Processes which involve inspection and testing of products (some times considered as part of the manufacturing processes). Forming Processes include foundry processes (to produce castings) and other processes such as forging, stamping, embossing and spinning. These processes change the shape of the raw material (a metal) into the shape of the work piece without removing or adding material. Machining Processes comprise metal removal operations such as turning, milling, drilling, grinding, shaping, boring etc. Assembly Processes involve joining of parts or components to produce assemblies having specific functions. Process Planning is defined as the systematic determination of methods by which a product is to be manufactured economically and competitively. It consists of selecting the proper machines, determining the sequence of operations, specifying the inspection stages, and tools, jigs and fixtures such that the product can be manufactured as per the required specification. The detailed process planning is done at each component level. After the final design of the product has been approved and released for production, the Production Planning and Control department takes the responsibility of Process Planning and Process Design for converting the product design into a tangible product. As the process plans are firmly established, the processing time required to carryout the production operations on the equipments and machines selected are estimated. These processing times are compared with the available machine and labour capacities and also against the cost of acquiring new machines and equipments required, before a final decision is made to manufacture the product completely in house or any parts or sub assemblies must be outsourced. In transformation of raw materials into finished products, several questions need to be answered; such as: 1. What will be the production quantity? 2. What are characteristics of the products to be manufactured? 3. The availability of equipment and what kinds of equipment are to be purchased and what will be the investment? 4. What kinds of labour are required? 5. What should be the level of automation? 6. Make or buy the components required? Once these questions are answered, the process planning activity can be carried out with minute details as to how each component can be manufactured. Process Planning is concerned with planning the conversion processes needed to convert the raw material

into finished products. It consists of two parts (i) Process design and (ii) Operations design. The two terms are explained as under: Process planning establishes the shortest route that is followed from raw material stage till it leaves as a finished part or product. The activities that are associated with process planning are: List of operations to be performed and their sequence. Specifications of the machines and equipment required. Necessary toolings, jigs and fixtures. Gives the manufacturing details with respect to feed, speed, and depth of cut for each operation to be performed. It gives the estimated or processing time of operations. All the above information is represented in the form of a document called process sheet or route sheet. The information given in the process sheet can be used for variety of activities. It becomes the important document for costing and provides the information on the various details like set-up and operation times for each job. The machine and manpower requirements can be computed from the set-up and operational times. Helps to carryout scheduling. The material movement can be traced. It helps in cost reduction and cost control. It helps to determine the efficiency of a work centre. Factors affecting process planning (i) Volume (quantity) of production. (ii) Delivery dates for components or products. (iii) Accuracy and process capability of machines. (iv) The skill and expertise of manpower. (v) Material specifications. (vi) Accuracy requirements of components or parts. Steps in Process Planning 1. Detailed study of the component drawings to identify the salient features that influence process selection, machine selection, inspection stages and toolings required. 2. List the surfaces to be machined. 3. The surfaces to be machined are combined into basic operations. This step helps in selection of machines for operation. 4. Determine the work centre, tools, cutting tools, jigs and fixtures and inspection stages and equipment. 5. Determine the speed, feed and depth of cut for each operation. 6. Estimate the operation time. 7. Find the total time to complete the job taking into account the loading and unloading times, handling times, and other allowances. 8. Represent the details on the process sheet. Process design is concerned with the overall sequences of operations required to achieve the product specifications. It specifies the type of work stations to be used, the machines and equipments necessary to carryout the operations. The sequence of operations is determined by (a) The nature of the product, (b) the

materials used, (c) the quantities to be produced and (d) the existing physical layout of the plant. Operations design is concerned with the design of the individual manufacturing operation. It examines the man-machine relationship in the manufacturing process. Operations design must specify how much labour and machine time is required to produce each unit of the product. Process Design-Framework The process design is concerned with the following: (i) Characteristics of the product or service offered to the customers, (ii) Expected volume of output, (iii) Kinds of equipments and machines available in the firm, (iv) Whether equipments and machines should be of special purpose or general purpose, (v) Cost of equipments and machines needed, (vi) Kind of labour available, amount of labour available and their wage rates, (vii) Expenditure to be incurred for manufacturing processes, (viii) Whether the process should be capital-intensive or labour-intensive, (ix) Make or buy decision and (x) Method of handling materials economically. Selection of process Process selection refers to the way production of goods or services is analysing. It is the basis for decisions regarding capacity planning, facilities (or plant) layout, equipments and design of work systems. Process selection is necessary when a firm takes up production of new products or services to be offered to the customers. Three primary questions to be addressed before deciding on process selections are: How much varieties of products or services will the system need to handle? What degree of equipment flexibility will be needed? What is the expected volume of output?

Process decisions:
Major process decisions are: Process choice : It refers to choice of a particular process, based upon the nature of product. The operations manager has to choose from five basic process types (i) Job shop, (ii) Batch, (iii) Repetitive or assembly line, (iv) Continuous and (v) Project. Vertical integration : Vertical integration is the degree to which a firms own production system handles the entire supply chain starting from procurement of raw-materials to distribution of finished goods. Two directions of vertical integration are: (a) Backward integration which represents moving upstream toward the sources of raw-materials and parts, for example, a steel mill going for backward integration by owning iron ore and coal mines and a large fleet of transport vehicles to move these raw materials to the steel plant. (b) Forward integration in which the firm acquires the channel of distribution (such as having its own warehouses, and retail outlets). Procedure for process planning and design

1. The inputs required comprise the product design information, production system information and product strategy decisions. 2. Process planning and design starts with selection of the types of processes, determining the sequence of operation, selection of equipment, tooling, deciding about the type of layout of facilities and establishing the control system for efficient analysing of resources to achieve most economical production of the product. 3. The outputs are specific process plans, route sheets, flow charts, assembly charts, installation of equipments, machinery, material handling systems and providing trained, skilled employees to carryout the production processes to achieve the desired results. Process analysis and process flow design : While analysing and designing processes to transform input resources into goods and services, certain questions need to be asked. They are: Is the process designed to achieve competitive advantage in terms of differentiation, response or low cost? Does the process eliminate steps that do not add value? Does the process analysing customer value as perceived by the customer? Will the process enable the firm to obtain customer orders? A number of tools help production manager to understand the complexities of process design and redesign. Some of such tools are: (i) Flow diagram, (ii) Assembly charts, (iii) Process charts and (iv) Operation and Route sheet. These tools are discussed in the following paragraphs. Flow Diagrams: It is a drawing used to analyse the movement of people or material or product to understand, analyse and communicate the process to others. Assembly Charts: Assembly charts are used to provide an overall macro view of how materials and sub assemblies are assembled to form finished products. These charts list all major materials, components, sub assembly operations, inspections and assembly operations. Process Charts: A process chart is understood as a graphic representation of events and information relating to them during a series of actions or operations. Operation process charts are similar to assembly charts except that they include specifications for the components as well as operating and inspection times and thereby provide more instruction on how to produce an item. The operation analysis and routing sheets or simply the route sheets specify precisely how to produce an item by identifying the equipment and tools to be used, the operations to be carried out and their sequence to be followed and the machine set up and run-time estimate. Purpose of Process Charts Process charts can present a picture of a given process so clearly that every step of the process can be understood by those who study the charts.

Process charts may be effective in process analysis and may help in detecting inefficiencies of the processes currently adopted. Types of Process Charts Process charts can be classified as operation process charts, flow process charts, worker-machine/manmachine charts and activity charts or multiple activity charts. (a) Operation Process Chart Operation process chart, the basic process chart is a graphic representation of the points at which materials are introduced into the process and of the sequences of inspections and all operations except those involved in material handling. It includes information considered desirable for analysis such as time required and location. Flow Process Chart Flow process chart is a graphic representation of all operations, transportations, inspections, delays and storages during a process and includes information for analysis such as time required and distance moved. It is especially useful in detecting hidden, non-productive costs such as delays, temporary storages and distances travelled. Worker-Machine Chart or Man-Machine Chart or Multiple Activity Chart Worker-machine charts or man-machine charts are graphical representation of simultaneous activities of a worker and the machine or equipment he or she operates. These charts help identify idle time and cost of both workers and machines. Alternative worker-machine combinations can be analysed to determine the most efficient arrangement of worker-machine interaction for carrying out a job. Worker-machine charts show the time required to complete tasks that constitute a work cycle. A cycle is the length of time required to progress through one complete combination of work activities. Operation Analysis and Route Sheet: An operation and route sheet specifies operations and process routing for a particular part and assembly. It conveys such information as the type of equipment, tooling, and operations required to complete the part, equipment setup time and operation time etc. Process improvement It is a systematic study of the activities and flows of each process to improve the process. Once the process is thoroughly understood, it can be improved. Process improvement becomes necessary because of relentless pressure to provide better quality at a lower price. The basic techniques for analysing the processes such as flow diagrams and process charts are useful for understanding the processes and improve them. Improvements can be made in quality, through-put time, cost, errors, safety and on-time delivery. Process improvement is necessary when: (i) the process is slow in responding to the customer, (ii) the process introduces too many quality problems or errors, (iii) the process is costly,

(iv) the process is a bottleneck, with work accumulating and waiting to go through it, and (v) the process involves waste, pollution and little value addition. Application of BCA in the choice of machines or process This analysis is the most convenient method for selecting the optimum method of manufacture or machine amongst the competing ones. The cost estimates of the competing methods (both fixed and variable costs) are prepared and a particular quantity N is determined at which the alternatives give the same cost. If the quantity to be manufactured is less than N the process with lower fixed cost is selected and if the quantity to be produced is more than N the process with lower variable cost is selected. Let FA the Annual Fixed Cost of Machine A FB the Annual Fixed Cost of Machine B VA Variable Cost per unit for Machine A VB = Variable Cost per unit for Machine B N = Quantity at which costs on both machines will be equal. Total cost on machine A = Total cost on Machine B for Quantity N i.e., FA + VA.N = FB+VB.N or, N(VA-VB) = FB- FA or The alternative with lower fixed cost will be more economical for manufacturing up to N and once the quantity exceeds N, it is economical to select an alternative with lower variable cost.

Problems and Solutions

Problem 1: A component can be manufactured either on centre lathe or on a turret lathe. The cost and time information to process a component is given below. The tooling costs are to be recovered within a year. There are no repeat orders. The requirements are to be met in two lots. (i) Find the quantity at which both alternatives results in equal cost. (BEP) (ii) Give the decision rule regarding the choice of lathes (iii) If the quantity required is 800 Nos./year, which of the machine do you propose? Solution: Let F1 = Fixed cost for the centre lathe. Fixed cost consists of set-up and tooling up costs. Fixed cost for centre lathe (F1) = Set-up cost + Tooling up cost F1 = No. of set-ups/year set-up time/set-up (hrs) [(set-up labour rate) + (Depreciation and other expense/hr)] + tooling up costs. =2x 30 60 x (10 + 2) + 200 = 212 (Rs.) Similarly, Fixed cost of turret lathe (F2) = 2 90 60 x (20 + 2) + 500= Rs. 566 Variable cost for centre lathe = V1 V1 = Processing time [(Labour cost/hr + Depreciation and other cost/hr)] =

10 60 (10 + 2) = Rs. 2 / piece Variable cost for turret (V2) V2 = 5 60 (20 + 2) = 1.83 Rs. /piece. Let, Quantity at which both alternatives gives equal cost be N. N=
12 21

F F V V = 566 212 2 1.83 = 354 0.17 = 2082.3 = 2083. Thus the break-even quantity is 2083 pieces. 2. Decision Rule (i) If quantity is below 2083, Centre lathe is preferred because of lower fixed cost. (ii) For quantities above 2083, turret lathe is preferred. (iii) For quantity 2083, both are equally feasible select either of the two machines. Problem 2: A Companys fixed and variable costs for manufacturing a component on three alternative machines are given below formulate the decision rules for selecting the machines. Solution: The total cost = fixed cost + [variable cost / unit no. of units] Let, Tc1 , Tc2 and Tc3 be the total costs for engine lathe, capstan lathe and automat respectively Let, x be the number of units to be manufactured Then, Total cost on Engine lathe (Tc1) = 5 + 0.2x Total cost on Capstan lathe (Tc2) = 30 + 0.lx Total cost on Automat (Tc3) = 70 + 0.05x Now, comparing the Tc1 and Tc2. 5 + 0.2x = 30 + 0.lx 0.lx = 25 x = 250 Comparing the Tc2 and Tc3 At B.E.P. Tc2 = Tc3 30 + 0.1x = 70+0.05x 0.05x = 40 x = 800 Decision Rules (i) If the quantity is below 300, select engine lathe (ii) Between 300 to 800, select capstan lathe (iii) Above 800, Automat is to be selected. Problem 3 : A Job is performed on the milling machine. The following details are given below: Standard time for job = 6 minutes No. of jobs to be produced = 70,000 jobs Machine capacity = 2000 hrs/month Machine utilisation = 90% Compute the number of machines required.

Solution: Standard Time (ST) = 6 60 = 1 10 hrs. Maximum Production (MP) = 70,000 Machine Capacity (MC) = 2000 hrs/month Utilisation of capacity (UC) = 0.9 No. of Machines required (N) N= ST MP MC UC = 0.1 70,000 2,000 0.9 = 3.88 Machines = 4 Machines Problem 4: A company wants to expand the solid propellant manufacturing plant by the addition of more 1 tonne capacity curing furnace. Each tonne of propellant must undergo 30 minutes of furnace time including loading and unloading operations. Furnace is used only 80 per cent of the time due to power restrictions. The required output for the new layout is to be 16 tonnes per shift (8 hours). Plant efficiency (system) is estimated at 50 per cent of system capacity. (a) Determine the number of furnaces required (b) Estimate the percentage of time the furnace will be idle Solution Required system capacity = Actualoutput SystemEfficiency = 16tonnes/shift 0.5 = 32.0 tonnes/shift Reared system capacity (hrs) = 32tonnes/shift 0.8 8 hrs/shift = 5 tonnes/hrs. Individual furnace capacity = 1tonne 0.5hr = 2 tonnes / hr per furnace (i) Number of furnaces required (N) = Requiredfurnance capacity Individual furnace capacity N= 5tonnes/hr 2 tonnes/ hr/ per furnace

= 2.5 furnaces (say 3) (ii) Total Hours available per shift = 3 furnace @ 8 hours = 24 furnaces hrs (iii) Total Hours of actual use per shift =16 tonnes 0.5 hr/tonne = 8 furnace hr Idle hours = 24 - 8 = 16 hours Percentage idle time = 5hrs idle 2hrs total = 66.66% 67% Idle time. Problem 5: A lathe machine is used for turning operation and it takes 30 minutes to process the component. Efficiency of the lathe is 90 per cent and scrap is 20 per cent. The desired output is 600 pieces per week. Consider 48 hours per week. Determine the number of lathes required? Solution Assuming 50 weeks in a year. The output per annum = 600 50 = 30,000 units. The scarp rate is 20%. The quantity to be produced (including scarp) Requiredoutput (1 Scraprate) = 30,000 (1 0.2) = 37,500 units Total time required for turning = 37,500 30 60 = 18,750 hours Production time required with 90 per cent efficiency = 18,750 0.9 =20833.3 hours Time available per lathe per annum = 48 50 = 2400 hrs Number of lathes required = = = Timerequired(hrs) 20833.3 8.68 9 Timeavailable(hrs) 2400 No. of lathes required = 9 Problem 6: An article is processed on three machines A, B and C as shown below:

A B C B

Machine Machine operation time Preparation Cleaning time (min/day) (min/day) Time Processing Total A 2 2.5 4.5 15 10 B 3 10 13 30 10 C 2 5 5 35 10

A study revealed that if the jigs for machines B and C were to be redesigned, loading and unloading times could be reduced to 2 minutes and 1 minute respectively. (a) Find the number of pieces produced per day (single shift of 8 hrs). (b) Costing has shown that unless production is increased by 20 per cent the installation of new jigs

would not be worthwhile. Would you recommend redesign of jigs. (c) If the number to be produced is large, suggest changes in present arrangement and estimate new production rate. Solution:
Machines Processing time (minutes) Preparation and cleaning (min/day) A 2 + 2.5 = 4.5 25 B 3 + 10 = 13 40 C 2 + 5 = 7 35

(a) Cycle time for the job is 13 minutes. Total production-time available/day = 480 - preparation and cleaning time/day For machine B (critical operation) = 480 40 = 440 min= 440/13 Output/day = 34 pieces (b) Redesigning the new jigs: The redesigning of new jigs will change the cycle time, i.e., the cycle time is reduced to 12 minutes (from 13 min as the unloading and loading time is reduced by 1 minute) Output/day = 440/12 = 36.6 = 37 pieces Percentage increase in output = 37 34 34 100 % = 9% So the redesign of jigs is not justified. (c) Suggestion if the number of pieces is large: The critical operation (bottleneck) is processing on machine B which requires 10 minutes. If we introduce one more machine of kind B, then the cycle time will be reduced to 8 min.

2.10 Human Resource Planning

HRP is a process of stricking balance between human resources required and acquired in an organisation. In other words, HRP is a process by which an organisation determines how it should acquire its desired manpower to achieve the organisational goals. Thus, HRP helps an organisation have the right number and kind of people at the right places and right times to successfully achieve its overall objectives. Human resource planning is a process of determining and assuming that the organisation will have an adequate number of qualified persons, available at the proper times, performing jobs which meet the needs of enterprise and which provide satisfaction for the individuals involved. HRP is the process- including forecasting, developing and controlling-by which a firm ensures that it has the right number of people and the right kind of people at the right places at the right time doing work for which they are economically most useful. HRP can be defined as the comparisons of an organisations existing labour resources with forecast labour demand, and hence the scheduling of activities for acquiring, training, redeploying and possibly discarding

labour. It seeks to ensure that an adequate supply of labour is available precisely when required. HRP could be seen as a process, consisting of the following series of activities: 1. Forecasting future personnel requirements, either in terms of mathematical projections of trends in the economy and developments in the industry, or of judgements estimates based upon specific future plans of the company. 2. Inventing present manpower resources and analysing the degree to which these re-sources are employed optimally. 3. Anticipating Manpower Problems by projecting present resources into the future and comparing them with the forecast of requirements, to determine their adequacy, both quantitatively and qualitatively. 4. Planning the necessary programmes of recruitment, selection, training, employment, Utilisation, transfer, promotion, development, motivation and compensation so that future man power requirements will be duly met. Objectives of HRP : The main objective of having human resource planning is to have an accurate number of employees required, with matching skill requirements to accomplish organisational goals. In other words, the objectives of human resource planning are to: Anticipate the impact of technology on jobs and requirements for human resources. Assess surplus or shortage, if any, of human resources available over a specified period of time. Control the human resources already deployed in the organisation. Ensure adequate supply of manpower as and when required. Ensure proper use of existing human resources in the organisation. Forecast future requirements of human resources with different levels of skills. Provide lead time available to select and train the required additional human resource over a specified time period. Importance of HRP: 1. Despite growing unemployment, there has been shortage of human resources with required skills, qualification and capabilities to carry on works. Hence the need for human resource planning. 2. Human resource planning is also essential in the face of marked rise in workforce turnover which is unavoidable and even beneficial. Voluntary quits, discharges, marriages, promotions and seasonal fluctuations in business are the examples of factors leading to workforce turnover in organisations. These cause a constant change and flow in the work force in many organisations. 3. Human resource planning is also needed in order to meet the needs of expansion and diversification programmes of an organisation. 4. Large numbers of employees, who retire, die, leave organisations, or become incapacitated because of

physical or mental ailments, need to be replaced by the new employees. Human resource planning ensures smooth supply of workers without interruption. 5. Technological changes and globalisation usher in change in the method of products and distribution of production and services and in management techniques. These changes may also require a change in the skills of employees, as well as change in the number of employees required. It is human resource planning that enables organisations to cope with such changes. 6. The need for human resource planning is also felt in order to identify areas of surplus personnel or areas in which there is shortage of personnel. Then, in case of surplus personnel, it can be redeployed in other areas of organisation. Conversely, in case of shortage of personnel, it can be made good by downsizing the work force. Human resource planning is important to organisation because it benefits the organisation in several ways. The important ones are mentioned below: 1. By maintaining a balance between demand for and supply of human resources, human resource planning makes optimum use of human resources, on the one hand, and reduces labour cost substantially, on the other. 2. Careful consideration of likely future events, through human resource planning might lead to the discovery of better means for managing human resources. Thus, foreseeable pitfalls might be avoided. 3. Human resource planning compels management to assess critically the strength and weaknesses of its employees and personnel policies on continuous basis and, in turn, take corrective measures to improve the situation. 4. Human resource planning helps the organisation create and develop training and succes-sion planning for employees and managers. Thus, it provides enough lead time for internal succession of employees to higher positions through promotions. 5. Human resource planning meets the organisation need for right type of people in right number at right times. 6. It also provides multiple gains to the employees by way of promotions, increase in emolu-ments and other perquisites and fringe benefits. 7. Last but no means the least, with increase in skill, knowledge, potentialities, productivity and job satisfaction, organisation becomes the main beneficiary. Organisation is benefited in terms of increase in prosperity / production, growth, development, profit and, thus, an edge over its competitors in the market. 8. Manpower shortfalls and surpluses may be avoided, to a large extent. 9. Some of the problems of managing change may be foreseen and their consequences mitigated.

Consultations with affected groups and individuals can take place at an early stage in the change process. This may avoid resistance for change. 10. Through human resource planning, duplication of efforts and conflict among efforts can be avoided, on the one hand, and coordination of workers efforts can be improved, on the other. Forecast requirement for human resources in the future: There are various techniques varying from simple to sophisticated ones employed in human resource forecasting. These include: 1. Management Judgement, 2. Work-Study Method, 3. Ratio-Trend Analysis, 4. Delphi Technique, 5. Flow Models, 6. Mathematical Models.

2.11 Material Requirement Planning

Material requirement planning (MRP) refers to the basic calculations used to determine component requirements from end item requirements. It also refers to a broader information system that uses the dependence relationship to plan and control manufacturing operations. MRP is a technique of working backward from the scheduled quantities and needs dates for end items specified in a master production schedule to determine the requirements for components needed to meet the master production schedule. The technique determines what components are needed, how many are needed, when they are needed and when they should be ordered so that they are likely to be available as needed. The MRP logic serves as the key component in an information system for planning and controlling production operations and purchasing. The information provided by MRP is highly useful in scheduling because it indicates the relative priorities of shop orders and purchase orders. Materials Requirement Planning (MRP) is a technique for determining the quantity and timing for the acquisition of dependent demand items needed to satisfy master production schedule requirements. MRP is one of the powerful tools that, when applied properly, helps the managers in achieving effective manufacturing control. MRP Objectives: 1. Inventory reduction: MRP determines how many components are required, when they are required in order to meet the master schedule. It helps to procure the materials/components as and when needed and thus avoid excessive build up of inventory. 2. Reduction in the manufacturing and delivery lead times: MRP identifies materials and component quantities, timings when they are needed, availabilities and procurements and actions required to meet delivery deadlines. MRP helps to avoid delays in production and priorities production activities by putting due dates on customer job orders.

3. Realistic delivery commitments: By using MRP, production can give marketing timely information about likely delivery times to prospective customers. 4. Increased efficiency: MRP provides a close coordination among various work centres and hence helps to achieve uninterrupted flow of materials through the production line. This increases the efficiency of production system. Functions served by MRP 1. Order planning and control: When to release orders and for what quantities of materials. 2. Priority planning and control: How the expected date of availability is compared to the need date for each component. 3. Provision of a basis for planning capacity requirements and developing a broad business plans.