Case presentation in operation model

1. TABLEOFCONTENTS
AbouttheCompany OperationsManagementat
MRF
AssemblyLine&Bottleneck
ERPImplementation OperationalManagement
Issue
01 02
04 05
03
Lean&
SixSigma
06

2. MRF’sJourney
1946 1952 1956 1967
K. M. Mammen Mappillai
started MRF’s journey as
a toy balloon
manufacturing unit in a
shed in Tiruvottiyur in
Madras in 1946
MRF ventured into the
manufacture of tread
rubber in 1952 put them
on the road and into the
big leagues
By 1956, within 4 years,
MRF was the market
leader of tread rubber in
India with a 50% share
MRF became the first
Indian company to export
tyres to the very
birthplace of tyre
technology, the United
States
AbouttheCompany

3. TheJourneyContinued...
1978 1997 2007 2013
MRF developed the MRF
Superlug-78, a sturdy
tyre for heavy-duty
trucks, country's largest
selling truck tyre
MRF ventured into F3
cars for the very first time
MRF made a turnover of
1 Billion Dollars
It also launched ZSLK
tyres – the first eco
friendly tyre
MRF's Aero Muscle
becomes the only Indian
tyre to be chosen for the
legendary fighter jet -
Sukhoi 30 MKI

4. AbouttheCompany
Product Portfolio
● Tyres
● Sports Goods- Cricket Kit, Bat
● Funskool- Toy Manufacturing
● Pretreads- precured retreading
system
● Paints & Coats
Services Offered
● MRF Tyres & Service (T&S)
● MRF Tiretok
Robotic Wheel Aligner
Vehicle Safety Test Lane
Diagnostic Wheel Balancer
Semi-Automatic Tyre Changer
A/C Recovery And Recharging Unit
Electronic Headlight Aligner
● MRF Tyredrome- Luxury service
● MRF Fasst- air-conditioned customer
care center
● MRF Musclezone- For commercial
vehicles

5. 01 OperationsManagementatMRFLTD.

6. ProductionUnits
Company has four production unit in every manufacturing plant:
1. Tube Plant
2. Tyre Plant
3. Mixing Plant
4. PCTR Plant
For understanding the whole process we will look at the different
departments:-
● Production Planning Department
● Plant Purchase Department
● Raw materials Store Department
● Production department
● Shipping (dispatch) Department

7. Production Planning Department:-
● The Central Planning at Corporate office will issue the Production plan for the coming month
● Based on this, plant planning incharge will issue the monthly simulation plan to central planning, plant
● production and to shipping.
● According to the monthly plan and the inventory norms set by the company requirement of raw materials and
consumables will be prepared
● Monthly requirement of raw materials is calculated from software and it is validated every six months
● Based on the monthly simulation plan of the whole manufacturing unit, each plant will make its own simulation plan
● The simulation plan for 3 segments of 10 days each is prepared and micro planning is done based on that
● Simulation plan for the work in process material is also prepared as material moves to other plant
● Production details report is sent to central planning on a daily basis for the previous day’s production
● Plan Vs Production report is published every 10 days and also on a monthly basis.
Plant Purchase Department:-
Purchase items are categorized as follows:
● Items which come under the head capital expenditure
● Items which come under engineering spares(non capital expenditure)
● Stationery and miscellaneous items (items which don’t come under the preview of raw
● materials)
● Services (Repairing of machinery)
Procedure for purchasing:-
● Any person who needs a material can make a purchase requisition but it has to be authorized by the department head. This has to
be routed through engineering store
● Based on the indent, necessary quotations are invited and purchase orders are released. The copy of purchase order is sent to the
supplier, intender, accounts, stores, corporate office PEM and a file copy for plant purchase

8. Raw materials Store Department:-
● From the Raw material requirement for the month sent by plant planning, central make purchase arrangement
● Delivery schedule is prepared, by which supplier release the materials on the specified dates to the plant
● After the weighment of the raw material it is unloaded in the storage unit or the place of consumption
● Technical department take the sampling and after testing the material is give one of the three tags:
○ Green => “ OK”
○ Orange=> “ Hold”
○ Red => “ Rejected”
● Inventory monitoring is hybrid of continuous and fixed period method
● Materials are issued to production as per the indent raised by production in each plant
Production Department:-
It is the primary function of the company, production is carried in four plant in the manufacturing unit
Following are the main functions of the production department:-
● Planning for production process
○ Central planning will give monthly plan to this department every month, based on that a simulation plan is prepared
○ For this a month is divided into 3 segments, 10 days each
● Material indent and receipt
○ The daily requirement of raw material is calculated at each plant after considering the
○ available inventory
○ The schedule production for the next day raw material indented is made to raw material store
● Processing : Processing is carried out per the technical specification
● Product identification and traceability
● Inspection

9. Shipping (dispatch) Department:-
● Finished goods will be received from inspection/ packing area size wise, batch wise or lot wise on the
basis of production Transfer Note
● Proper storage and identification of finished goods is the responsibility of shipping department
● Finished goods will be stored size wise on pallets with transfer slips showing the size, quantity, date of
receipt
● There are stacking norms for finished goods, where ever specified norms will be followed
● Shipping will publish Daily Dispatch Simulation Plan
● Daily Dispatch plan is prepared based on simulation plan, allocation plan and urgency as intimated by
central planning /marketing, transportation time required, availability of truck, shelf life of the product

10. AssemblylineandBottleneck
02

11. Structure Diagram of Assembly Line at MRF
Banbury Mixer
Fabric Calender
Extruders
Wire
Calender
Fabric Bias
cutter
Tyre Building
Wire cutter
Bead
Construction
Curing Press PCI
Final
Inspection

12. Above chart shows the queuing time ( avg waiting time) in the assembly line.
From this we can see that Fabric Calendering has the largest waiting time and it will be the bottleneck in the process.
BottleneckIdentification

13. DeterminingtheSpecificcauses
‘5 Why ‘ analysis was chosen to determine the specific causes for the bottleneck:
Why reduced tyre production? Lack of green tyre for curing
Why lack of green tyres?
Too much time taken for producing green
tyres
Why green tyre production
takes time?
The calendered rolls are taking too much
time to get standardized after each roll
Why are the rolls not being
set properly?
Each roll has specified temperature and it
takes time for setup
Why are roll are taking time to
be set at required
temperature?
No apparatus to check the temperature is
correct or not. It was done by trial and
error method

14. Key points :
● Calendering machines are taking more time than other process
● Company was using 3 roll calendering machine
● which takes 2 passes of fabric to coat both side with rubber
● Very time consuming and waste of money
Solution:
● 3 roll calendering machines to be replaced with 4 roll calendering
machine available in the market
● This replacement reduced the cost by 40%
● It removes the process of second pass as both side will be coated
in single pass
Bottleneckelimination
3 roll
calendering
machine
4 roll
calendering
machine

15. ERPImplementation
atMRF
03

16. Problem:-
● MRF was using outdated systems that were not capable to keep up with the expanding operation of company
● Slow availability of information, manual data entry, less flexibility,improper utilization of human resource all these
resulted in increased cost to the company and its performance
● Also, lot of time was spending in consolidating the information and data on time which give signal to MRF that
there is need to replace the non-integrated system and independent system
● The company needed a flexible and total low cost of ownership in its IT solution and decided to implement SAP
ERP and SAP CRM based on the SAP NetWeaver platform
The Solution:-
● To determine the requirements of the company a core team “ Power User Team” was formed for selection of
suitable ERP
● A detailed evaluation was performed based on various criteria as product offerings, experience in the
manufacturing
● After evaluation Oracle and SAP were short listed, MRF participated in aSAP summit which helped the company to
take the final decision
● SAP offered a clear solution for MRF’s manufacturing operations which included process as well as discrete
production
ERPImplementationatMRFLtd.

17. SD
FICO
MM
PM
PP
QM
HR
SAP
ERP
Implementation:-
● There were 60 members from MRF and 35 members from Siemens in implementation process, core
team ensured that with collaboration implementation was on the schedule.
● One of the challenge during the implementation was the company’s system were working in silos
● SAP ERP has been implemented at the company’s Head Office in Chennai, 6 factories in
Thiruvottiyur, Arakkonam, Pondicherry,Medak, Goa and Kottayam, and around 80 Sales Offices
● Finance and Controlling
● Sales and Distribution
● Human Resource
● Material Management
● Production Planning
● Quality Management
● Plant Maintenance

18. OperationalManagement
issueatMRFLtd. 04

19. Problem Definition
● MRF decided to launch a new and state of the tires system for heavy
vehicles
● This was the first of its kind in the market of tyres
● MRF wanted to make its product to end customers by the target date
without any delays
● The raw material was sourced from different locations and final product
delivered to the customer must have all the accessories packed with it
● MRF wanted their retailer and distributors to have up to the minute
information regarding the product availability
● Top management should ensure that there will be no issue with the
delivery of the new product

20. From the cost analysis MRF decided to produce some of the parts in India and rest to out source in different
countries.
Also, MRF team up with VISTA supply chain management system to deliver the products.
1. Major components were manufactured in ASIA
2. Assembled in Japan and Thailand
3. Accessories are manufactured in Eastern Europe countries
Distribution of the product:-
● Assembled products from japan and Thailand were flowned to Kentucky and distributed after packaging to North
America
● Latin America region was covered with air freight from Kentucky
● Product Supply to North and Europe and Africa: The assembled product was air shipped to Bucharest, Romania
and is packaged with accessories and sent to retailers
● Asia Pacific Region: The accessories are flown to Thailand and packaged with product
Major Results:-
● The supply chain got reduced by 40%
● Increased speed to end customer and retailers
● Product is launched at the same time globally without any delays
Solution: Synchronizedsupplychainmanagement

21. LeanandSixSigmain
Manufacturing 05

22. Define:-
Here all the processes and department of manufacturing of tyres are studied and performance is measured to find out
inefficiency and wastage in the system.
Measure:-
Here all five processes of manufacturing that is
● Banbury Mixing
● Tuber, Calendering
● Tyre Building
● Tyre Curing
All these processes were measured on different parameters for further analysis
Analyse Phase:-
Here all the departments are analysed, ‘WHY-WHY’ analysis is performed to understand the cause of the defect
Also different departments are combined to clearly define the cause and effect, an example of this is show in the next slide.
DMAICmethodwasusedbyMRF

23. Defect Area Sr. No Cause Sub causes
Off
Centered
Bead
Bead
fitting
and
stitching
1 Finger distance low Finger distance setting off specifications
2 Bead off centred Wrong bead
3 Low pressure and dwell time Pressure setting off specifications
4
Bead setting without air trap and wrinkles Operators fault
US disc setting off specifications
US disc damaged
5 Drum spotting not ok Setting off specifications
6
Specific BSR off specification Operational lapse
Non identified BSR
Edge worn out of BSR
Blisters Awling
of the GT
1 Awling not done properly Improper length of the needle
Improper rpm and pressure of the gun
2 Awling not done at a
specific position
Operational error
3 Awling not done for a
specific number of times
Operational error
Contaminati
on
Curing of
the GT
1 Contamination in mould
Improper cleaning
Contaminated Green Tyres used
Use of overused mould
Cured flash
Damaged mould

24. Starvation Banbury
Mixing
1 Stock properties off specification Wrong recipe
Wrong polymer
Polymer weight off specification
Wrong oil used
Oil weight off specification
Wrong filler used
Filler weight off specification
Wrong chemical packet
Wrong mixing sequence
Curing of
GT
2 Improper tyre shaping pressure Hydraulic leak
Airline leakage
Bladder pin hole
Shaping regulator failed
Defect Area Sr. No Cause Sub causes

25. Improve and Control :-
1). Loading and Unloading efficiency in Banbury mixing:
● Closing of the bottom drop door and opening of the top door would happen simultaneously by using on one single push button.
● Per batch around 4 seconds is saved
● This would result in improving the Loading and Unloading efficiency
Table below gives the comparison of the current and proposed system
Important parameters Current Proposed
Total number of activities 5 4
Number of non-value added activities 2 0
Average total time is taken for activities 2 and 3 together (in a sec) 8 4
Average Time is taken per batch for Loading and Unloading (in a sec) 20 16
Batches produced currently on an average per shift 235 245
Average Loading and Unloading Efficiency (%) 58.835 100
2). Defects in tyre building and tyre curing:
● 3M/4M condition was used which comprises of condition to be followed, the requirement for that given condition, ways to
check and maintain it
● 3M/4M conditions were generated only after proper discussion with Industry guide, supervisors from the respective
department and other staff in the industry having experience and knowledge
Example of this Starvation and Blisters are given in the next slide

26. 3M Condition Requirement How to check and Maintain
Method Preparation of the Green
Tyre for loading
Uniform application of the paint Visual, For every tyre
Material Defect free Green Tyre Proper setting of components of Green
Tyre
Visual, For every tyre
Machine
Shaping PRV No cut packing (SS diaphragm), Stage 1 shaping regulator ok,
Stage 2 shaping regulator ok
Open and check, during PM schedule
Defect free Green Tyre The specified setting of the pressure
and tread centering
Visual, for every tyre
3M Condition Requirement How to check
Men No air traps present in
Green Tyre
Proper awling process done at specific
distance and number of times
Follow the
specification, each tyre
No impurities in the vents of press mould
Proper cleaning of vents Visually, before loading
No impurities in the vents
of press mould
Use of mould only till its specified life Visually, PM schedule
Machine No air traps present in
Green Tyre
Proper rpm and pressure of pneumatic
gun used for awling
Visually and
Pressure gauge, each tyre
Material No impurities in the vents
of press mould
No contamination on the Green Tyre Visually, each tyre
Proper awling application
for removing air traps
Use of proper needle for awling Visually, each tyre

27. THANKYOU!