final sem project report - copy
TRANSCRIPT
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A REPORT
ON
STUDY OF PRODUCTION PLANNING AND CONTROL SYSTEM IN EICHER
TRACTORS, MANDIDEEP
TOWARDS FULFILLMENT OF THE REQUIREMENTS
OF POST GRADUATE DEGREE IN MASTER OF MANAGEMENT STUDIES
OF MUMBAI UNIVERISTY
SUBMITTED BY
Sunil S. Gaikwad
MMS- ROLL NO: M1252
BATCH 2013-2014
UNDER THE GUIDANCE OF
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FR. C. RODRIGUES INSTITUTE OF MANAGEMENT STUDIES, VASHI
STUDENT DECLARATION
I SUNIL SURYAKANT GAIKWAD, studying in the Second Year of Master of
Management Studies Course at Fr. C. Rodrigues Institute of Management Studies,
Vashi, Navi Mumbai, hereby declare that I have completed the project titled
Production Planning Control as a part of the course requirements for MMS
Programme.
I further declare that the information presented in this project is true and original to
the best of my knowledge.
Date: ________________
Signature of student
Place:
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CERTIFICATE FROM THE INTERNAL GUIDE
I, hereby certify that Mr. < Student Name>a student for the Master of Management
Studies Course at Fr. C. Rodrigues Institute of Management Studies, Vashi, Navi Mumbai,
has completed a project on under my guidance during this year.
His work and output has been found to be satisfactory.
Date: ________________
Signature of guide
Place: Vashi
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Acknowledgement
I take this opportunity to sincerely thank and express my gratitude to my guide, Dr.
R. C. Walke for him cooperation and inputs throughout the course of this project. It was
largely due to him help, support, esteemed guidance and encouragement that this project
could take shape and be completed. I thank him for giving direction to this project and
imbibing in an organized approach towards tackling the relevant problems.
I also thank the Head of our Institute Mr. Prakash Vaithilingam for giving us
freedom to work.
I am deeply grateful to my co-guide Mr. Srirang Joshi for giving a definite direction
to my work and providing crucial inputs throughout the project besides being a constant
motivating factor. I thank him for sparing him time in guiding me and assisting me in various
aspects of my work.
Finally, I would like to thank my family and my friends without whom it would have
been tremendously difficult for me to get through this project.
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Executive Summary
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Index
Sr. No. Topic Page No.
1 Situation Analysis 1
2 Problem Definition 7
3 Literature Review 7
4 Methodology of Study and Data Analysis 9
5 PPC Process 10
6 Conclusion 23
7 Recommendations 39
8 Reference 46
9 51
10 52
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1.Situation analysis
Eicher Tractors, Mandideep
The Eicher Group started in 1948 when the Goodearth Company was set up to sell and
service imported tractors in India. Perceiving an urgent need to mechanize Indian agriculture,
the Company set up a tractor manufacturing facility i.e. Eicher Tractors Limited in 1959 in
collaboration with Gebr. Eicher, Germany in India. The first Indian tractor rolled out of
Eicher's factory at Faridabad in India, in 1960.
Today, there are over 4,00,000 Eicher tractors that contribute to the nation's agricultural
development. Eicher's manufacturing and marketing facilities located at Faridabad have been
awarded ISO 9001 certification.
Eicher Tractors has a technology transfer tie-up with Valtra, Inc of Finland. It has an
extensive network of over 400 tractor dealers and around 56 engine dealers across India with
15 regional offices and 12 depots.
Committed to providing high quality products, Eicher invests significantly in technology
resources and infrastructure. Our manufacturing facilities are spread across three states:Highlights
Wide range of tractors, from 61 HP to 24 HP offering the best value for money. Product range includes air-cooled and water-cooled engines. Highly fuel efficient machines, with low maintenance costs. Conforming to international emission norms.
Product range also includes engines in the 22 HP to 32 HP and gensets in the 15 KVA to 30KVA categories
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2.Problem definition
The study is to prove that the production planning and control practices has impact on theefficient utilization of the resources, waste reduction, reduce waiting time and processing,
thus contributing to the profitability of the industry. On these premise the study accentuated
to address questions in order to achieve the following objectives:
(a) To know how the production planning contributes to the efficient use of facilities and
equipments.
(b) To know the effects of Production Planning and Control on Production function.
(c) To know whether production planning and control practices lead to waste reduction
and increased profit.
(d) To prove that short term production planning and scheduling techniques employed by
industries, is necessary in minimizing process and customer waiting time.
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3. Literature Review
Tractor industry plays an important part as agriculture sector has a major contribution toIndias GDP.
Tractors are part of agricultural machinery industry. Tractors came to India through imports
and later on were indigenously manufactured with the help of foreign collaborations. The
manufacturing process started in 1961-62. Indian tractor industry is relatively young but now
has become the largest market worldwide.
There are currently 14 players in the industry. Mahindra & Mahindra is the leading player in
the industry.
Monsoon season is a key driver for sales of tractors. A series of good or bad monsoon can
affect the sales. In recent years the industry has registered a good growth in sales, both
domestic as well as exports. This is also partly because of the initiative of the government to
boost up agriculture and agricultural machinery industry.
The tractor penetration level in India is very low as compared to the world standards. Also
the penetration levels are also not uniform throughout the country. While the northern region
is now almost saturated in terms of new tractor sales, the southern region is still under
penetrated. The medium horse power category tractors, 31-40 HP, are the most popular in the
country and fastest growing segment.
4. Methodology of study and Data Analysis
Pertinent information is gathered from the respondents using a structured questionnaire. The
structured questionnaire is consists of descriptive questions to get the description of various
aspects of Production Planning and Control. The initial questions are to cover the variables
characterizing the various production planning and control practices such as demand
forecasting, inventory, capacity utilization, and scheduling techniques while the last segment
will purely on Control practices.
Unstructured personal interview is also conducted in order to augment the responses that may
not be explicitly cleared in the questionnaire. Like this the data is properly collected,
organized, and presented.
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Q2 Capacity plann ing contr ibutes to the effi cient use of f acil it ies and equipments?
I f Yes then how?
Options Yes No
Response 8 2
Interpretation
Most of the respondents i.e. 80% are in favor of the statement that capacity Planning
contributes to the efficient use of facility and equipments.
Proper Capacity planning leads to optimum utilization of capacity reduces idle time, under or
over utilization of capacity.
Response
Yes
No
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Q3. What are the main objectives of Production Planni ng?
a) Optimum Utilization of Capacity
b) Inventory control
c) Economy in Production Time
d) Ensure Quality
e) Waste reduction and increased profit
Interpretation
All the respondents believe that waste reduction and increased profit is the main objective of
production planning, some of them also believe that optimum utilization of capacity is
another objective of production planning.The other objective of production planning is
inventory control, economy in production time, and quality insurance.
0
2
4
6
8
10
a b c d e
Options A b c D E
Response 8 6 4 2 10
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Q4. ProductionPlanning and Capacity Planning are in terr elated?
If yes then how?Options Yes No
Response 7 3
Interpretation
Majority of the respondents i.e. 70% believe that production planning and capacity planning
are interrelated. Long term Production planning becomes the basis of capacity planning. Size
of production and type of production depends on capacity, hence both are interrelated.
Response
Yes
No
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Q5. Since, capacity cant always be added or subtracted instantaneously; there will be
mismatch of load and capacity.
What are its effects?
a) Lead time get affected
b) Increase in cost
c) Hurts the ability to satisfy customers
d) Other effects
Please specify other effects (if any)
Options a b c D
Response 0 9 10 2
Interpretation
Almost all respondents believe in the above statement. According to them mismatch in loadand capacity, leads to customer dissatisfaction and increase in cost. If the capacity is low and
demand is high, orders will not be completed on time. If load is less and capacity is more then
requirement it will lead to inefficient use of capacity, hence, cost of production will increase.
As lead time is calculated on the basis of available capacity it has no effect on lead time.
Other effects can be increase in cost by increasing man power and plant maintenance, and
delay in delivery to customers.
0
2
4
6
8
10
a b c d
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Q6. On what basis do you plan your production?
a) Customer needs (demand)
b) Target of Marketing Dept.
c) Resources available
d) Other factors
Please specify other factors (if any)
Options A b c D
Response 8 0 10 0
Interpretation
According to the data collected from the respondents the production planning of Eicher
Tractors, Mandideep is based on customer need i.e. dealers demand for particular models,
and also on the basis of resources available.
The marketing department reports to the PPC/Store about dealers requirements. PPC/Store
communicates with the material department about availability of material. Hence, market
demand and availability of resources is considered as base for production plans.
0
2
4
6
8
10
a b c d
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Q7. Do you feel or experienced hung up and bottlenecks in implementing
Production Plans.
a) Yes
b) No
If yes then what type of bottlenecks?
Options Yes No
Response 4 6
Interpretation
Majority of the respondents i.e. 60% are in against of the statement, hence, all the department
works in integration. Heads of all the department sits together and prepares plans which are
properly applicable.
There are people who experienced bottlenecks like- sequence change due to non availability
of material, and transforming one model to other due to requirement of specific model.
Response
Yes
No
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Q8. How do cur rent Production Planning and Capacity Planni ng methods account for
bottlenecks.
Interpretation
Current production planning and capacity planning highly depends on material available and
material in transit. The non availability of material and delay in transportation of material
hinders execution of plans properly. Due to this too many changes in daily and weekly plans
takes place.
Sometimes lack of coordination between PPC/Store, production department, and Quality
control department creates problem of rework and repair.
Q9. Previously what measur es have been taken to avoid such bottlenecks?
Interpretation
As the main source of bottleneck is timely not availability of material. So, proper care is
taken of the material providers, transportation of material, and inventory of material.
Following measures have been taken to avoid such bottlenecks:
Multiple vendors being developed for most of the items. Proper inventory level is being asked to maintain. Planning being done with the best availability of material
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Q10. I f resul ts are not according to the plans, what control measures are taken?
a) Revision of Plan
b) Any other measures.
Please specify other measures (if any)
Options Revision of Plan Other measures
Response 10 0
Interpretation
If the results are OK wait until next control period. If not OK, revision of plan is required tobe done. At present people of Eicher Tractors do not have any other solution except revision
of plan to control deviations in plans and results.
Response
Yes
No
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5. Production Planning and Control at Eicher Tractors,
Mandideep
Production plan is crucial to the success of any producing unit; it is an activity which is
continues in nature and required to be revised time to time as per the requirements. It cant be
done in isolation by a particular department; rather it is an integrated activity done by
Planning and Control Department in collaboration with Material Department, Production
Department, and Quality Control Department. The heads of various departments of Eicher
Tractors sits together and Plans there monthly, weekly, and daily production.
5.1 Process of Production Planning at Eicher
1. Marketing DepartmentMonthly details of Market demand
Production planning starts from the market details provided by Marketing Department.
Marketing Department provides there monthly requirements like- number of tractors, specific
models, specific color, capacity etc.
2. PPC/StorePreliminary Production Plan
PPC/Store receives message of monthly requirements from marketing department. PPC
studies the requirements and prepare a Preliminary Production Plan. This plan is sent to the
Materials Department.
3. Material DepartmentMaterial requirements planning
A copy of preliminary plan is sent to the material department. Material department studies the
plan and prepares a report which shows the availability of material, material in transit, plan of
receipt of material in chronological form, expected shortage of material, and any other
problem related to the material. Materials Requirements Planning (MRP) can be used in more
complex systems. MRP determines time-phased requirements (period-by-period) for all
purchased and manufactured parts such as raw materials, components, parts, subassemblies,
etc. . This report is sent to the PPC Department
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4. PPCRevision of preliminary Production plan.
On the basis of the report sent by material department, the PPC/Store revises the preliminary
plan. This revised plan is sent to the marketing department. Marketing department revises the
schedule of requirements according to the availability and sequence/schedule of receipt of
material.
5. Production Planning and Master Production Scheduling
After the consent of marketing department and material department the monthly Production
Plan and weekly master production scheduling is done. A copy of main plan and master
production schedule is sent to each department.
6. Daily Production Plan
Every day in morning the production head, quality head, and material head sits together,
discuss there problems, and unanimously prepares a daily production plan. This daily
production plan is displayed on planning board of every department and at every level of
assembly line. This daily production plan shows sequence of operations, sequence and
schedule of material movement, post pending material, pre pending material, and shortage ofmaterial. This daily plan is automatically get updated with the completion of operations at
every level.
7. Control
In results are not according to the Daily Plans, the plan is required to be revised. Daily
Production Plan is revised number of times considering the material shortages, problems with
assembly line, etc. if material is post pending i.e. on assembly line its operation cant be
changed, but, changes can be made in the sequence and scheduling of pre pending material
i.e. material in queue. Efforts are made to plan a sequence which minimizes the idle time of
assembly line, labour, and other equipments.
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6. Conclusion
After doing this project I am in position to conclude that Eicher Tractors, Mandideep has well
defined and structured production planning system. PPC defines the sequences and schedules
of operations; hence production planning contributes to the efficient use of facilities and
equipments.
PPC is done to identify production process which leads to reduced lead time; hence customer
waiting time is also reduced.
PPC ensures optimum utilization of production capacity, material, and other equipments;
hence it leads to waste reduction and increased profits.
7. Recommendations
The production planning and control of Eicher Tractors, Mandideep, highly depends on the
material availability. In case of shortage of material the overall plan get disturbed. If such
problem prevails the optimum results cannot be achieved. To avoid such problem following
measures can be taken:
a. Proper Materials Planning done,b. Materials must be purchased from multiple vendors,c. Sufficient safety stock must be maintained,d. Lead time and responsibility must be fixed at the part of vendors.
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8. REFERENCES
1. www.wikipedia.org2. www.tmtl.com3. www.eichertractors.in4. www.researchandmarkets.com
http://www.wikipedia.org/http://www.wikipedia.org/http://www.tmtl.com/http://www.tmtl.com/http://www.eichertractors.in/http://www.eichertractors.in/http://www.eichertractors.in/http://www.tmtl.com/http://www.wikipedia.org/