29-08-2014, 11:45 AM
6 Months Training Report and Project at Hero Cycles Ltd. Vendor SPA (Supplier Plan Adherence) Management, Inventory Half in Stores at Hero Cycles Limited
Chapter 3- Project work 3.1 Major Project- Project 321- Half Inventory Inventory or stock refers to the goods and materials that a business holds for the ultimate purpose of resale (or repair). Aim: To reduce overall inventory from 30Crores to 15Crores Fig.3.1 Project 321 Inventory Half- Timeline 3.1.1 Inventory Half Fig.3.2 Project 321 Inventory Half- Action Plan-cum-Timeline Aim: To reduce 7 day stock to 2-3 day stock (inventory). SOP - • Mapping the existing Inventory • Overall Inventory Norms finalization • Item Location finalization in stores • Material Process Flow • One day advance Orders for dispatch • 2 day advance Orders for dispatch • Vendors- Process Sharing & Sign off QC • Segregation of Dead Stock, Slow moving and fast moving items • Exhausting of Dead stock • Trolley/Bins Management • Mock up trial • Go Live 3.1.2 (a) No Check Aim: To reduce time taken and manpower for checking (incoming inspection) materials. Fig.3.3 (a) Project No check- Action Plan-cum-Timeline SOP - • Preparation of Item Matrix-counting Time/deliveries/manpower • Finalizing the Storage/Handling mode • Defining Stores Storage space • Designing of Bins/Trolleys • Implementation and Trials • Go live 3.1.2 (b) No Count Aim: To reduce time taken and manpower for counting of materials. Fig.3.3 (b) Project No count- Action Plan-cum-Timeline SOP – • Vendor visit for No Check (self Certified Vendors) • Gap Closing- Instruments/Receiver Gauges/QA Inspection SOP • SOP signing with Suppliers • Trial Supplies • Go live 3.1.3 Bin Management system Aim: To make standard packing equipments (standardized bins/trolleys) for material keeping in stores. Fig.3.4 Project Bin management- Action Plan-cum-Timeline SOP – • Item wise packaging identification & cost calculation • Demarcation of space for Empty trolleys /Bins • Material Handling SOP • Handling Equipment Requirement • Handling Equipment Procurement • Trials • Go live 3.1.4 Vendor Management SPA (Supplier Plan Adherence) Aim: To maintain the Supplier Plan Adherence for different items. Fig.3.5 Project Vendor Management SPA- Action Plan-cum-Timeline SOP – • Release of week Plan to the vendors • Sharing Daily SPA of vendors • Reviewing & Meeting the Defaulter Vendors and generate CAPA • CAPA adherence meeting • SPA Adherence sign off 3.1.5 Guthi Outsourcing Aim: To procure the small items in one packet (Guthi) from vendors and stop the Guthi packing line. Fig.3.6 Project Guthi outsourcing- Action Plan-cum-Timeline SOP – • Outsource Methodology Finalization • Identification of Potential Suppliers • Finalization of Suppliers • QA Process Deployment • Code Creation • Trial Procurement • Regular procurement 3.1.6 SKD Box Standardization Aim: To make the SKD boxes for similar models common. Fig.3.7 Project SKD Box Standardization- Action Plan-cum-Timeline SOP – • Data Collection -Present Status • Analysis & Rough cut proposal • CFT/RND/Marketing discussion & finalization • Drawings Preparation • Order on modified Boxes • Trial Procurement & education • Quality Approval/ & Report • Field feedback • ECN Creation • ECN implementation 3.1.7 Purchase outsourcing of C-Class items Aim: To procure the C-Class items from single vendor and ask for CI (Cost Innovation). Fig.3.8 Project C-Class item outsourcing- Action Plan-cum-Timeline SOP – • Identification and listing Potential vendors • Discussion with Potential Vendors • Vendors Finalization • Agreement with the Vendors • Inventory/Bin location/Layout /Space finalizing/Preparation of Drawings • Designing of Bins • Bin Refilling system with signals • Frequency of refilling and Bin requirement • Consumption matrix to be shared with vendor • Daily Signal to vendor-3 day Plan • Consolidation of Purchasing and CI • Existing vendor follow up system • Go live 3.1.8 Vendor People Control inside Factory Aim: To keep a check on vendor people inside the factory. Fig.3.9 Project Vendor people control inside factory- Action Plan-cum-Timeline SOP – • Offloading unloading to New Contractor Scope plan by target date • New System Implementation 3.1.9 Purchase outsourcing of Finished Handles Aim: To procure the Finished handles from vendors and stop the handle assembly line. Fig.3.10 Project Finished Handle outsourcing- Action Plan-cum-Timeline SOP – • Identification and listing Potential vendors • Discussion with Potential Vendors • Vendors Finalization • Agreement with the Vendors • Inventory/Bin location/Layout /Space finalizing/Preparation of Drawings • Designing of Trolleys • Trolleys Requirement • Consumption matrix to be shared with vendor • Daily Signal to vendor-3 day Plan • Consolidation of Purchasing and CI • Existing vendor follow up system • Go live 3.1.10 Purchase outsourcing of Spoke Nipple Aim: To procure the spoke nipple from vendor and stop its production in Hero Cycles Limited. Fig.3.11 Project Spoke Nipple outsourcing- Action Plan-cum-Timeline SOP – • Identification and listing Potential vendors • Discussion with Potential Vendors • Vendors Finalization • Agreement with the Vendors • Inventory/Bin location/Layout /Space finalizing/Preparation of Drawings • Designing of Bins • Bin Refilling system with signals • Frequency of refilling and Bin requirement • Consumption matrix to be shared with vendor • Daily Signal to vendor-3 day Plan • Consolidation of Purchasing and CI • Existing vendor follow up system • Go live 3.2 Minor Project- 3.2.1 Vendor Management SPA (Supplier Plan Adherence) and MIS A management information system (MIS) provides information that organizations require to manage themselves efficiently and effectively. An MIS gives business managers the information they need to make decisions and solve problems, while facilitating data from different aspects of a project. Early business computers were used for simple operations such as tracking inventory, billing, sales, or payroll data, with little detail or structure. In dispatches, schedule adherence or on-time performance refers to the level of success of the service remaining on the published schedule. There are many factors that can have an impact on on-time performance. Supplier Plan adherence is calculated by dividing the number of deliveries in a period by the total number of “Planned” deliveries made. The result is then multiplied by 100 and expressed as a percentage. Problems- At Hero Cycles Limited – • Late incoming of items Frames, Forks, Handles, Mudguards, Chain covers • Reduction in PPA (Production Plan Adherence) • Truck Detention and Penalties (Due to late dispatches) At Vendors End – • No Fixed Plans • Fluctuations in Demands • Late orders • Abrupt changes in demands • More and frequent model changeovers • Accumulation of non moving stock Vendors- • For Frames, Forks and Handles ? Tirupati industries ? Chandan industries ? Tushar industries ? Raka willpower industries ? Appu international ? Surpal industries ? Navyug industries ? Mapco industries ? KS Munjal group ? Everbest industries ? Highrise industries ? Arpan industries • For Mudguards, Chain covers ? Mahalaxmi industries ? Kular Industries ? Kohinoor Industries ? BM Munjal Group ? Amar udyog ? Munjal exports Aim- • To provide a fixed week plan to frame, fork and handle vendors and fixed 3 day plan to mudguard chain cover vendors • Minimum fluctuation of orders and demands • Exhausting of non moving Items at vendor ends • Vendor development • Reduction in Model changeover at vendor end • Increasing the productivity at vendors end • Asking for Cost Innovation i.e., 2% • Timely meeting with defaulter vendors and listening to their grievances • Discussion of CAPA (Corrective Actions and Preventive Actions) with vendors in case of any abnormality in receiving of orders Result- • SPA (Supplier Plan Adherence) Increased to more than 90 % • Timely Dispatches of orders • Lesser No. of trucks detained • Lesser Penalties • Cost Innovation i.e., Discount of 2% for each item achieved. • Productivity at vendor end increased by 30-50% due to timely weekly plans • Vendors satisfied which help in vendor development • Due to fixed plans vendor can now keep appropriate inventory of finished goods at their end • No more Fluctuation in supply of items, causing a smooth vendor-buyer relationship 3.2.2 Line Balancing (4 in 1 Packing) Problems- • Lesser Production • Frequent model changeovers • Frequent Breakdowns • Uneven distribution of work at the line • Long breaks for material arrangement on the line • Material shortage on packing line • Uneven stock for different items (half an hour stock for fork and tire/tube but 16 hours stock for brake set, mudguard and small fitting box) • No fixed plan given by PPC (Production planning and control) to the supervisor which causes frequent model changeovers • Line idle for most of the time • Rejection due to missing material in 4 in 1 kit Aim- • Increasing Productivity • Reducing model changeovers • Reducing the no. of Breakdowns • Poor line balancing i.e. 50% • Evenly distribution of work at the Packing line • Minimum down-time for material arrangement on the line • No or minimum Material shortage on packing line • Evenly distributed stock for all items (1 to 2 hours of stock) • Fixed plan to be given by PPC (Production planning and control) to the supervisor to avoid frequent model changeovers • Proper utilization of manpower Result- • Increased Productivity • Model changeovers minimized • No. of Breakdowns Reduced • 90% Line Balancing achieved • Minimum down-time for material arrangement on the line achieved • Material shortage on packing line at its minimum value achieved • Evenly distributed stock for all items (1 to 2 hours of stock) achieved • Fixed plan is being given by PPC (Production planning and control) to the supervisor • A few men shifted to material arrangement work from the line without affecting conveyor speed and production of the line 3.2.3 Warehouse Management at 3T logistics (Hero Moto Corp, Haridwar) Problems- • Material incoming from Hero Cycles Limited not being fed to the warehouse • Wrong supply of items to the dealer • Quality problems at dealer end • Late dispatches of orders to dealers • Uneven Inventory (7 days inventory in case of some items and 0 inventory in case of others) • Accumulation of non moving stock • No fixed Plan sent to Hero Cycles Limited • Storage area for items not defined • No FIFO maintained • Proper layout of warehouse not available • Standardization of trolleys not done • Difference in physical stock and system stock Aim- • Proper and timely supply of items to the dealer • Evenly Balanced Inventory (3 days in case of all items) • Exhausting non moving stock • Fixed Plan to be sent to Hero Cycles Limited according to demand from dealer • Proper defining of storage area for each and every item • Maintaining FIFO • Making a proper layout of warehouse • Standardization of trolleys • Matching of physical stock and system stock • Training a person at warehouse to minimize quality problems at dealer end Result- • Proper and timely supply of items to the dealer • Balanced Inventory (3 days in case of all items) maintained • FIFO Maintained • Non moving stock exhausted • Standardization of trolleys done and ordered the optimum no. of trolleys which are needed to keep 3 day inventory • Fixed Planning to Hero Cycles Limited according to demand from dealer • Storage area for each and every item properly defined • Proper layout of warehouse made and space allocated for each item • Physical stock and system stock matched daily • Quality person well trained and quality maintained properly 3.2.4 5S, Kaizen Implementation at Hero Cycles Limited Introduction- 5S is much more than ‘a place for everything and everything in its place’. 5S comprises five principles to make people highly efficient and effective in doing their work. • Sort: Keep near you only what you regularly use • Straighten: Find exactly what you need to use in less than 30 seconds • Shine: Have your workplace and equipment ready for immediate use • Standardize: Everyone does each job in the same way and is challenged to improve it • Sustain: Everyone does their part to foster a safe, efficient and effective workplace • Sort: Keep near you only what you regularly use • Straighten: Find exactly what you need to use in less than 30 seconds • Shine: Have your workplace and equipment ready for immediate use • Standardize: Everyone does each job in the same way and is challenged to improve it • Sustain: Everyone does their part to foster a safe, efficient and effective workplace Problems- • Mismanagement of work • A lot of NVA (Non Value Added) activities • No Standardization of working • No SOP’s of projects • Poor Co-ordination of different departments • No clear vision about one’s work • No sincerity for work among staff • No sense of belongingness to one’s work in employees • Skill and potential of employees not utilized Aim- • To raise the potential of workers and employees • Preventing mistakes that ruin a job and makes scrap and rework • Making sure equipment is reliable and works properly to make a perfect item every time • Removing and preventing useless variation in work activities and machine performance • Delivering exact quality products and service ever more quickly • Keeping people and plant safe from hazards and harm • 20% Increase in Productivity and 20% Decrease in Manufacturing Cost Result- • Unnecessary items Removed • Work made easy by eliminating obstacles • Accumulation of unnecessary items prevented • Evaluation of the unnecessary items with respect to dept/cost/other factors. • Arrangement done for necessary items in order so they can be easily picked for use • Loss and waste of time in different operations prevented • Necessary items put in easy reach • First-come-first-serve principle ensured • Work flow made smooth and easy • Employees clean their workplace themselves • Machinery and equipment deterioration minimized by self-inspection by operators • Maintain high standards of housekeeping and workplace organization at all times • Cleanliness and orderliness maintained • "Self-Discipline" maintained in workers as well as employees • 20% Increase in Productivity and 20% Decrease in Manufacturing Cost being Achieved Kaizen is a Japanese word for "improvement" or "change for the best". Kaizen refers to activities that continually improve all functions, and involves all employees from the CEO to the assembly line workers.