Industrial MANAGEMENT NOTES

1. Introduction:
 Location of an industry is an important management decision.
 It is a two-step decision:
 first, choice of general area or region and
 second, the choice of site within the area selected.
 Location decision is based on the organisations long-term strategies such as
technological, marketing, resource availability and financial strategies.
Meaning of Plant Layout:
 After deciding the proper site for locating an industrial unit, next important point to
be considered by an entrepreneur is to decide about the appropriate layout for the
plant.
 Plant layout is primarily concerned with the internal set up of an enterprise in a
proper manner.
 It is concerned with the orderly and proper arrangement and use of available
resources viz., men, money, machines, materials and methods of production inside
the factory. A well designed plant layout is concerned with maximum and effective
utilisation of available resources at minimum operating costs.
 The concept of plant layout is not static but dynamic one. It is on account of
continuous manufacturing and technological improvements taking place
necessitating quick and immediate changes in production processes and designs.
 A new layout may be necessary because of technological changes in the products as
well as simple change in processes, machines, methods and materials”.
 A new layout also becomes necessary when the existing layout becomes ineffective
and poor or is not conducive to the changed circumstances. There are certain
indications which raise alarm for immediate changes in the existing layout of plant.
 These indications may be in the form of excessive manufacturing time, improper
storage, lack of control over materials and employees, poor customer service,
excessive work in progress and work stoppages etc.
 “Plant layout is the arrangement of machines, work areas and service areas within a
factory”. —George R. Terry

2.  “Plant layout involves the development of physical relationship among building,
equipment and production operations, which will enable the manufacturing process
to be carried on efficiently”. —Morris E. Hurley
 “Any arrangement of machines and facilities is layout”. —F.G. Moore
 “Plant layout can be defined as a technique of locating machines, processes and plant
services within the factory so as to achieve the greatest possible output of high
quality at the lowest possible total cost of manufacturing”. —Sprigal and Lansburg
 “Plant layout ideally involves the allocation of space and the arrangement of
equipment in such a manner that overall operations cost can be minimised.”
—J. Lundy
 From these definitions it is clear that plant layout is arrangement and optimum
utilisation of available resources in such a manner so as to ensure maximum output
with minimum input.
The objective of plant location decision-making is to minimise the sum of all costs
affected by location.
Plant location is important because of the following:
(i) Location influences plant layout facilities needed.
(ii) Location influences capital investment and operating costs.
 Location decisions are strategic, long-term and non-repetitive in nature.
 Without sound and careful location planning in the beginning itself, the new facilities
may create continuous operating problems in future.
 Location decision also affects the efficiency, effectiveness, productivity and
profitability.
 The location decision should be taken very carefully, as any mistake may cause poor
location, which could be a constant source of higher cost, higher investment,
difficult marketing and transportation, dissatisfied and frustrated employees and
consumers, frequent interruptions of production, abnormal wastages, delays and
substandard quality etc.

3. Objectives of Plant layout:
A properly planned plant layout aims at achieving the following objectives:
1. To achieve economies in handling of raw materials, work in- progress and finished
goods.
2. To reduce the quantum of work-in-progress.
3. To have most effective and optimum utilisation of available floor space.
4. To minimise bottlenecks and obstacles in various production processes thereby avoiding
the accumulation of work at important points.
5. To introduce system of production control.
6. To ensure means of safety and provision of amenities to the workers.
7. To provide better quality products at lesser costs to the consumers.
8. To ensure loyalty of workers and improving their morale.
9. To minimise the possibility of accidents.
10. To provide for adequate storage and packing facilities.
11. To workout possibilities of future expansion of the plant.
12. To provide such a layout which permits meeting of competitive costs
The objectives of plant layout have been nicely explained by Shubin and Madeheim. “Its
objective is to combine labour with the physical properties of a plant (machinery, plant
services, and handling equipment) in such a manner that the greatest output of high
quality goods and services, manufactured at the lowest unit cost of production and
distribution, will result.”

4. Location Economics:
 The selection of the location for an industrial plant is a long time commitment. A new
enterprise may be suffered throughout its life due to unfavourable location.
 Once a plant has been built, the expense and disruption of activities necessary to
move it to a more favourable location is quite impracticable.
 Therefore, the search for plant site justifies very careful consideration.
For evaluation of economical location following factors should be considered:
1. Raw material procurement.
2. Proximity (nearness) of market.
3. Availability of labour, their training and compensation.
4. Availability of power.
5. Availability of finance (Bank).
6. Miscellaneous considerations like donations, subsidies, taxes and non-interference by
government or local bodies, war and political effects and other facilities or bottle necks.
Let R1 and R2 be the two available sources of raw material supply, one place of market or
consumption is M, and L is the location of the factory. Then, if L is at M, only freight on
raw material will be paid or if L is at R1 or R2, there will be only distribution charges on the
manufactured goods.
Now, again if an intermediate place is selected both incoming and outgoing freights will be
paid. Actually in practice, a comparison should be made of each element of the cost
required to be involved, if the plant is erected at each of these alternative locations as
shown in triangular form in Fig. 31.1.

5. Economical Aspects:
Location economics for an enterprise includes a consideration of the product to be manu-
factured, the processes and machinery to be used, and the service and facilities required.
To know this the following factors may be studied:
1. Product:
(a) Nature,
(b) Volume, and
(c) Value.
2. Production process:
(a) Continuous,
(b) Intermittent, and
(c) Interrupted.
3. Manufacturing machinery.
4. Other manufacturing equipment’s.
5. Special manufacturing requirement.
6. Service:
(a) Steam,
(b) Gas,
(c) Water,
(d) Air or high pressure,
(e) Electricity, and
(f) Sewerage.

7. Market Location:
To solve such problems a market analysis of the area is conducted and answers of the
following questions can be found out:
1. If there is a market which could be served and if retail price of product can be reduced?
2. Whether quick delivery of the product can be made by better plant location to the
particular market?
3. Whether there is a competitor for the product in the market? Whether demand for
product may increase? Whether an additional plant is required to meet the future demand?
4. What is the potential purchasing power of the market?
5. What are the buying habits of local people, and what must be done to fit your service to
these habits?
Selection of Site in an Urban Area:
Advantages:
1. It is sometimes possible to find an existing building which can be used to house the
factory.
2. It is easier to sell the building, if it is desired, at later stage.
3. Power and water is easily available.
4. If other factories are also situated in a big city, there will be good opportunity for
discussing and having exchange of knowledge.
5. Good market for small manufacturers.
6. It is well served by railways and roads from various parts of the country so that
transportation of incoming and outgoing materials is convenient and cheap.
7. It is a good labour market, where all types of labour available. Seasonal labour is also
easily obtained than in a smaller centre of population, especially where unskilled labour is
required.
8. Workers find easy to change job from one industry to other, if required.
9. Services of repairs and maintenance etc. can be available with existing industries.

8. 10. Large number of government of facilities will be easily available like-Post office,
Banks, Railways, Police and Fire protection.
11. Houses for workers are easily available.
12. Education for the children is not a problem.
13. Transport is easy.
Disadvantages:
1. Often sites are limited in area as sufficient land is not available and congested. Hence
climate is not healthy.
2. Area being limited, it may not be possible to arrange the equipment to the best of
advantages.
3. The cost of land is high and rates are liable to increase further. Land for expansion is not
available at reasonable rates. The larger the city, the larger the land value.
4. Because of high standard of living, higher wages of labour will have to be paid.
5. More problems about labour and employer relations.
6. Cost of building factory will be high.
7. High taxes.
Selection of Site in a Rural Area:
Advantages:
1. The cost of land is less than in a city area and usually easier to provide space for future
expansion.
2. The cheapness of land enables a more efficient layout of works to be made and gives
greater freedom in selecting the most economic design for the buildings.
3. Rail or road connection can be arranged easily.
4. Labour supply may be arranged from the nearby areas or by transport from the city.
Labour is cheaply available.
5. Housing can be provided by private enterprises or by local authorities.
6. Healthy surrounding and pleasant atmosphere.

9. 7. Less labour trouble.
8. Lesser taxes and restriction.
Disadvantages:
1. Sufficient power and water facilities may not be available.
2. Enough facilities for expansion may not be available.
3. Repairing work may become difficult, because of less industry in the area.
4. Skilled workers are not easily available.
5. No recreational facilities.
6. Facilities for education to children and adults (part time courses) may not be available.
7. Government facilities may not be sufficient.
8. Transport and housing facilities may not be satisfactory.
Location for an Industrial Plant:
 The principle of Industrial Plant Location is that the sum of manufacturing and
distributing cost should be at minimum for the best location.
 The first two factors are related with the transportation cost.
 One should be clear that a plant may be located near the market as well as near the
raw materials site. But in actual practice, many times, due to some other factors, it is
not possible to locate an industry near the proximity of market as well as raw
material.
For economical analysis these factors play an important part:
(a) Following are the factors when an undertaking is located near the raw material site:
1. When source of raw material is likely be the controlling factor.
2. When materials are bulky and of relatively low price.
3. When materials are small and of high unit price.
4. When raw materials are greatly reduced in bulk during the process of manufacture.
5. When raw materials are perishable and process makes them less perishable.

10. The examples are processing industries (Fruit), Power plant (Nuclear Power Plant) etc.
(b) Factors responsible for locating an industry near the market:
1. When the size or bulk of the product is more.
2. Render it more fragile.
3. More subsection about the spoilage.
Examples are shoes, furniture, glassware industries.
(c) While dealing with the economy of labour, the factors responsible are:
1. The ratio of labour cost to total manufacturing cost. If the ratio is small then this factor is
not important.
2. The possibility of reduction in labour cost by using better methods or better quality of
labour.
3. The type of labour required.
For example, the textile industries silk and carpet making industries, sports goods etc.
(d) Now for the economy and availability of power:
This point is similar to the raw material procurement. If power is generated from coal, then
coal is a raw material. Hence still steel plants are located near the coal-mines etc.
(e) Other major factor that influences in availability of finance:
The finance can be obtained from Government agencies. Banks etc. at any place.
Advantages of a Good Layout
The advantages of a good layout can be studied from the stand point of the worker, labour
cost, other manufacturing costs, production control, supervision, and capital investment.
a. Advantages of layout to Worker
1. Reduction in the effort of the worker.
2. Fewer material handling operations.
3. Extension of the process of specialization.
4. Ensuring maximum efficiency.

11. 5. Better working condition and reduction in the number of accidents.
b. Advantages of layout in Labour Costs
1. Reduction in the number of workers.
2. Increase in production per-man-hour.
3. Reduction in the length of haul (pull or drag with effort).
4. Minimum lost motions between operations.
c. Advantages of layout in Other Manufacturing Costs
1. Maintenance and tool replacement costs are reduced.
2. Spoilage and scrap is minimized.
3. Greater saving in the waste of raw material consumption.
4. Improved quality of product due to reduction in the number of handling.
5. Saving motive power.
6. Effective cost control.
d. Advantages of layout in Production Control
1. Provision of adequate and convenient storage facilities.
2. Better conditions for receipts, shipment and delivery.
3. Increased pace for production.
4. Achievement of production targets
e. Advantages of layout in Supervision
1. Helps in easing the burden of supervision.
2. Reduces the level of inspection and this minimizing the cost of inspection.
f. Advantages of layout in Capital Investment
1. Investment in machinery and equipment is reduced because of
a. increase in production per machine
b. utilization of idle machine time and

12. c. reduction in the number of operations per machine
2. Permanent investment is kept at the minimum
3. Floor space and shop areas required for manufacturing are reduced.
4. Reduction in the number of material handling equipment, work-in-process and reduced
stock of finished products.
Thus, an efficient layout is necessary for achieving the objectives of the business i.e., higher
production, turnover and profits by minimizing the cost of manufacturing.
Bad Layout – Effects on Cost
 A bad layout results in unnecessary handling of materials and movement of men
and equipment.
 Actually, the quality of the product may come down due to damage suffered in
production process thus reducing the value added.
 Further, loss due to breakage, deterioration, etc., adds to costs being incurred. All
these factors increase the cost of manufacturing.
Symptoms of Bad Layout
The symptoms of bad layout are as follows:
1. Congestion of machines, materials, part assemblies and even workers.
2. Excessive number of work-in-process.
3. Poor utilization of space.
4. Long material flow lines.
5. Excessive handling by skilled workers and increased handling costs.
6. Increase in maintenance time.
7. Long production cycles.
8. Delay in delivery schedules.
8. Increase in handling costs.
10. Difficulty experienced in supervision and control.

13. 11. Increase in breakage of materials and products.
Principles of Plant Layout:
1. Principle of integration: A good layout is one that integrates men, materials,
machines and supporting services and others in order to get the optimum utilisation of
resources and maximum effectiveness.
2. Principle of minimum distance: This principle is concerned with the minimum travel
(or movement) of man and materials. The facilities should be arranged such that, the
total distance travelled by the men and materials should be minimum and as far as
possible straight line movement should be preferred
3. Principle of cubic space utilisation: The good layout is one that utilise both
horizontal and vertical space. It is not only enough if only the floor space is utilised
optimally but the third dimension, i.e., the height is also to be utilised effectively.
4. Principle of flow: A good layout is one that makes the materials to move in forward
direction towards the completion stage, i.e., there should not be any backtracking
5. Principle of maximum flexibility: The good layout is one that can be altered without
much cost and time, i.e., future requirements should be taken into account while
designing the present layout.
6. Principle of safety, security and satisfaction: A good layout is one that gives due
consideration to workers safety and satisfaction and safeguards the plant and
machinery against fire, theft, etc.
7. Principle of minimum handling: A good layout is one that reduces the material
handling to the minimum.
Facilities Layout Design and Facilities Location
Facilities layout design refers to the arrangement of all equipment, machinery, and
furnishings within a building envelope after considering the various objectives of the
facility. The layout consists of production areas, support areas, and the personnel areas in
the building (( Tompkins, J. A., et al., Facility Planning, Second Edition , John Wiley & Sons,
NY,1996 ).

14. Need of Facilities Layout Design
The need for facilities layout design arises both in the process of designing a new layout
and in redesigning an existing layout. The need in the former case is obvious but in the
latter case it is because of many developments as well as many problems within the facility
such as change in the product design, obsolescence (Outdated) of existing facilities, change
in demand, frequent accidents, more scrap and rework, market shift, introduction of a new
product etc.
Objectives of Facilities Layout Design
Primary objectives of a typical facility layout include
(1) Overall integration and effective use of man, machine, material, and supporting
services,
(2) Minimization of material handling cost by suitably placing the facilities in the best
possible way,
(3) Better supervision and control,
(4) Employee's convenience, safety, improved morale and better working environment,
(5) Higher flexibility and adaptability to changing conditions and
(6) Waste minimization and higher productivity.
Types of Layout
The basic types of layouts are:
 Product layout
 Process layout
 Fixed position layout
 Cellular layout
Product layout
 This type of layout is generally used in systems where a product has to be
manufactured or assembled in large quantities.
 In product layout the machinery and auxiliary services are located according to the
processing sequence of the product without any buffer storage within the line itself.

15. Figure 1: A Pictorial Representation of Product Type of Layout
 Assembly lines
 As per product (dedicated), same product
 Large volume
Advantages of product layouts include:
 Output. Product layouts can generate a large volume of products in a short time.
 Cost. Unit cost is low as a result of the high volume. Labour specialization results in
reduced training time and cost. A wider span of supervision also reduces labour costs.
Accounting, purchasing, and inventory control are routine. Because routing is fixed,
less attention is required.
 Utilization. There is a high degree of labour and equipment utilization.
Disadvantages of product layouts include:
 Motivation. The system's inherent division of labour can result in dull, repetitive
jobs that can prove to be quite stressful. Also, assembly-line layouts make it very
hard to administer individual incentive plans.
 Flexibility. Product layouts are inflexible and cannot easily respond to required
system changes—especially changes in product or process design.
 System protection. The system is at risk from equipment breakdown, absenteeism,
and downtime due to preventive maintenance.
Read more: http://www.referenceforbusiness.com/management/Int-
Loc/Layout.html#ixzz598WWBV3x

16. Table 1: Advantages and Disadvantages of Product Type of Layout
ADVANTAGES DISADVANTAGES
 Low material handling cost per unit
 Less work in process
 Total production time per unit is short
 Low unit cost due to high volume
 Less skill is required for personnel
 Smooth, simple, logical, and direct flow
 Inspection can be reduced
 Delays are reduced
 Effective supervision and control
 Machine stoppage stops the line
 Product design change or process
change causes the layout to
become obsolete
 Slowest station: pace of line
 Higher equipment investment
usually results
 Less machine utilization
 Less flexible
Process layout
 In a process layout, (also referred to as a job shop layout) similar machines and
services are located together.
 Therefore, in a process type of layout all drills are located in one area of the layout
and all milling machines are located in another area.
 A manufacturing example of a process layout is a machine shop.
 Process layouts are also quite common in non-manufacturing environments.
Examples include hospitals, colleges, banks, auto repair shops, and public libraries.
Figure 2: A Pictorial Representation of Process Type of Layout

17.  Different department (lathe machine with different features, milling shop,
grinding shop...)
 Variety of product
 Confusion in terms of movement
 Delays high
Advantages of process layouts include:
 Flexibility. The firm has the ability to handle a variety of processing requirements.
 Cost. Sometimes, the general-purpose equipment utilized may be less costly to
purchase and less costly and easier to maintain than specialized equipment.
 Motivation. Employees in this type of layout will probably be able to perform a
variety of tasks on multiple machines, as opposed to the boredom of performing a
repetitive task on an assembly line. A process layout also allows the employer to use
some type of individual incentive system.
 System protection. Since there are multiple machines available, process layouts are
not particularly vulnerable to equipment failures.
Disadvantages of process layouts include:
 Utilization. Equipment utilization rates in process layout are frequently very low,
because machine usage is dependent upon a variety of output requirements.
 Cost. If batch processing is used, in-process inventory costs could be high. Lower
volume means higher per-unit costs. More specialized attention is necessary for both
products and customers. Setups are more frequent, hence higher setup costs.
Material handling is slower and more inefficient. The span of supervision is small due
to job complexities (routing, setups, etc.), so supervisory costs are higher.
Additionally, in this type of layout accounting, inventory control, and purchasing
usually are highly involved.
 Confusion. Constantly changing schedules and routings make juggling process
requirements more difficult.
Read more: http://www.referenceforbusiness.com/management/Int-
Loc/Layout.html#ixzz598Xc3ABi

18. Table 2: Advantages and Disadvantages of Process Type of Layout
ADVANTAGES DISADVANTAGES
 Better machine utilization
 Highly flexible in allocating personnel
and equipment because general
purpose machines are used.
 Diversity of tasks for personnel
 Greater incentives to individual worker
 Change in Product design and process
design can be incorporated easily
 More continuity of production in
unforeseen conditions like breakdown,
shortages, absenteeism
 Increased material handling
 Increased work in process
 Longer production lines
 Critical delays can occur if the part
obtained from previous operation
is faulty
 Routing and scheduling pose
continual challenges
Fixed location layout
 In this type of layout, the product is kept at a fixed position and all other material;
components, tools, machines, workers, etc. are brought and arranged around it. Then
assembly or fabrication is carried out.
 The layout of the fixed material location department involves the sequencing and
placement of workstations around the material or product.
 It is used in aircraft assembly, shipbuilding, and most construction projects.
Figure 3: A Pictorial Representation of Fixed Location Type of Layout
 Job is stationary and machine is moving
 Depend upon size of structures
 e.g., a hospital operating room where doctors, nurses, and medical equipment are
brought to the patient, buildings, dams, and electric or nuclear power plants,
shipbuilding, aircraft, aerospace, farming, drilling for oil, home repair..

19. Read more: http://www.referenceforbusiness.com/management/Int-
Loc/Layout.html#ixzz598Ykf5JS
Table 3: Advantages and Disadvantages of Fixed Location Type of Layout
ADVANTAGES DISADVANTAGES
 Material movement is reduced
 Promotes pride and quality because
an individual can complete the
whole job
 Highly flexible; can accommodate
changes in product design, product
mix, and production volume
 May result in increase space and
greater work in process
 Requires greater skill for personnel
 Personnel and equipment movement
is increased
 Requires close control and
coordination in production and
personnel scheduling
Combination Layout (Mixed) = Product + process
Many situations call for a mixture of the three main layout types. These mixtures are
commonly called combination or hybrid layouts.
 For example, one firm may utilize a process layout for the majority of its process
along with an assembly in one area.
 Alternatively, a firm may utilize a fixed-position layout for the assembly of its final
product, but use assembly lines (product) to produce the components and
subassemblies that make up the final product (e.g., aircraft).
 Automobile
Cellular type layout
 Cellular manufacturing is a type of layout where machines are grouped according to
the process requirements for a set of similar items (part families) that require similar
processing. These groups are called cells. Therefore, a cellular layout is an equipment
layout configured to support cellular manufacturing.
 Processes are grouped into cells using a technique known as group technology (GT).
Group technology involves identifying parts with similar design characteristics (size,
shape, and function) and similar process characteristics (type of processing required,
available machinery that performs this type of process, and processing sequence).

20.  Workers in cellular layouts are cross-trained so that they can operate all the
equipment within the cell and take responsibility for its output. Sometimes the cells
feed into an assembly line that produces the final product. In some cases a cell is
formed by dedicating certain equipment to the production of a family of parts
without actually moving the equipment into a physical cell (these are called virtual or
nominal cells). In this way, the firm avoids the burden of rearranging its current
layout. However, physical cells are more common.
 An automated version of cellular manufacturing is the flexible manufacturing system
(FMS). With an FMS, a computer controls the transfer of parts to the various
processes, enabling manufacturers to achieve some of the benefits of product
layouts while maintaining the flexibility of small batch production.
Some of the advantages of cellular manufacturing include:
 Cost. Cellular manufacturing provides for faster processing time, less material
handling, less work-in-process inventory, and reduced setup time, all of which
reduce costs.
 Flexibility. Cellular manufacturing allows for the production of small batches, which
provides some degree of increased flexibility. This aspect is greatly enhanced with
FMSs.
 Motivation. Since workers are cross-trained to run every machine in the cell,
boredom is less of a factor. Also, since workers are responsible for their cells'
output, more autonomy and job ownership is present.
 This type of layout is based on the grouping of parts to form product / part families.
 Similar parts may be grouped into families based on common processing sequences,
shapes, tooling requirements, and so on.
 The processing equipment required for a particular product family are grouped
together and placed in a manufacturing cell.
 The cells become, in effect, miniature versions of product layouts. The cells may have
movements of parts between machines via conveyors or have a flow line connected
by a conveyor.
 This type of layout is used when various products have to be produced in medium to
large quantities.

21. Figure 4: A Pictorial Representation of Cellular Type Of Layout
 Instead of having different hammer (tools) in one place. Tools are placed in
different cells
 Clothing Industries
Table 4: Advantages And Disadvantages Of Cellular Type Of Layout
Advantages Disadvantages
 Higher machine utilization
 Smoother flow lines and shorter travel
distances are expected than for process
layout
 Offers some benefits of both product and
process type of layout because it is a
compromise between the two
 Encourages consideration of general
purpose equipment
 Greater labor skills required
 Flow balance required in each cell
 Has some of the disadvantages of
product and process type of layout; it is
a compromise between the two

22. Layout Selection
 The basis of selection of a layout is the volume-variety analysis. Volume-variety
analysis is based on the Pareto's principle, which focuses on the fact that a majority
of the resources are consumed by a small fraction of the population.
 For example 85% of the wealth of the world is held by 15% of the people. This rule
also applies to facilities design i.e. 85% of the production volume is attributed to 15%
of the product line. To decide a layout, a part-population analysis must first be
completed.
 A bar chart between the type of products and the quantity to be produced is
developed.
 This chart is also called product-quantity chart (Figure 5) and, based on this chart,
decision regarding the type of layout to be used is taken.
 For the products lying in the area X (Figure 5) -a product type of layout is
recommended and for the products lying in the area Y , a process type of layout is
recommended. In the middle (area between X and Y ), a combination of product and
process type layouts, is recommended (( Muther, R, Systematic Layout
Planning, Second Edition , CBI Publishing Company, Inc. Boston, 1973 ).

23. © Nigel Slack, Stuart Chambers & Robert Johnston, 2004 Operations Management, 4E: Chapter 7
7.12
Fixed-position
layout
Product
layout
Cell layout
Process
layout
Volume
Low High
Variety
Low
High
Flow is
intermittent
Regular flow more important
Flow
becomes
continuous
Regular
flow
more
feasible
Volume-variety relationship

24. Objectives of Plant Maintenance:
(i) The objective of plant maintenance is to achieve minimum breakdown and to keep the
plant in good working condition at the lowest possible cost.
(ii) Machines and other facilities should be kept in such a condition which permits them to
be used at their optimum (profit making) capacity without any interruption or hindrance.
(iii) Maintenance division of the factory ensures the availability of the machines, buildings
and services required by other sections of the factory for the performance of their
functions at optimum return on investment whether this investment be in material,
machinery or personnel.
Importance of Plant Maintenance:
(i) The importance of plant maintenance varies with the type of plant and its production.
(ii) Equipment breakdown leads to an inevitable (unavoidable) loss of production.
a. If a piece of equipment goes out of order in a flow production factory, the whole line will
soon come to a halt. Other production lines may also stop unless the initial fault is cleared.
b. This results in an immediate loss in productivity and a diminution (reduction) of several
thousand rupees per hour of output.
(iii) An un-properly maintained or neglected plant will sooner or later require expensive
and frequent repairs, because with the passage of time all machines or other facilities (such
as transportation facilities), buildings, etc., wear out and need to be maintained to function
properly.
(iv) Plant maintenance plays a prominent role in production management because plant
breakdown creates problems such as:
a. Loss in production time.

25. b. Rescheduling of production.
c. Spoilt materials (because sudden stoppage of process damages in-process materials).
d. Failure to recover overheads (because of loss in production hours).
e. Need for over-time.
f. Need for subcontracting work.
g. Temporary work shortages-workers require alternative work.
Types of Plant Maintenance:
Maintenance may be classified into following categories:
(a) Corrective or breakdown maintenance,
(b) Scheduled maintenance,
(c) Preventive maintenance, and
(d) Predictive maintenance.
(a) Corrective or Breakdown Maintenance:
 Corrective or breakdown maintenance implies that repairs are made after the
equipment is out of order and it cannot perform its normal function any longer, e.g.,
an electric motor will not start, a belt is broken, etc.
 Under such conditions, production department calls on the maintenance department
to rectify the defect.
 The maintenance department checks into the difficulty and makes the necessary
repairs.

26.  After removing the fault, maintenance engineers do not attend the equipment
again until another failure or breakdown occurs.
This type of maintenance may be quite justified in small factories which:
(i) Are indifferent to the benefits of scheduling;
(ii) Do not feel a financial justification for scheduling techniques; and
(iii) Get seldom (rarely) temporary or permanent demand in excess of normal operating
capacity.
 In many factories make-and-mend (repair) is the rule rather than the exception.
 Breakdown maintenance practice is economical for those (non-critical) equipment
whose down-time and repair costs are less this way than with any other type of
maintenance.
 Breakdown type of maintenance involves little administrative work, few records
and a comparative small staff.
 There is no planned interference with production programmes.
Typical Causes of Equipment Breakdown:
(i) Failure to replace worn out parts.
(ii) Lack of lubrication.
(iii) Neglected cooling system.
(iv) Indifference towards minor faults.
(v) External factors (such as too low or too high line voltage, wrong fuel, etc.)

27. (vi) Indifference towards -equipment vibrations, unusual sounds coming out of the rotating
machinery, equipment getting too much heated up, etc.
Disadvantages of Breakdown Maintenance:
(i) Breakdowns generally occur at inappropriate times. This leads to poor, hurried
maintenance and excessive delays in production.
(ii) Reduction of output.
(iii) Faster plant deterioration.
(iv) Increased chances of accidents and less safety to both workers and machines.
(v) More spoilt material.
(vi) Direct loss of profit.
(vii) Breakdown maintenance practice cannot be employed for those plant items which are
regulated by statutory (required) provisions, for example cranes, lifts, hoists and pressure
vessels.
(b) Scheduled Maintenance:
 Scheduled maintenance is a stitch-in-time procedure aimed at avoiding breakdowns.
Breakdowns can be dangerous to life and as far as possible should be minimized.
 Scheduled maintenance practice incorporates (in it), inspection, lubrication, repair
and overhaul of certain equipment which if neglected can result in breakdown.
 Inspection, lubrication, servicing, etc., of these equipment are included in the
predetermined schedule.
 Scheduled maintenance practice is generally followed for overhauling of machines,
cleaning of water and other tanks, white-washing of buildings, etc.

28. Difference between Scheduled and Preventative maintenance:
 Scheduled maintenance
 In many cases, repair work will be undertaken after a set period of time, with core
parts replaced in order to prevent wear and tear.
 The core feature that sets this work apart is the element of timing – inspections and
maintenance work are carried out according to a predetermined calendar to avoid
issues from arising in the first place.
 Preventative maintenance
 On the other hand, preventative maintenance is carried out based on expert analysis
of each part. Rather than simply conducting inspections of every maintenance issue
at one time, this approach allows each part to be inspected separately and have a
maintenance plan drawn up accordingly.
 What are the key differences?
 Preventative maintenance requires a much greater level of skill on the part of
inspectors to be able to forecast maintenance issues ahead of time and develop a
plan to address them. Scheduled maintenance doesn’t require forecasting, as long as
the interval between maintenance work isn’t too long.
 This difference makes preventative maintenance especially useful for complex work
 Both methods are also preferable to alternatives like run-to-failure, where
maintenance is only carried out after an issue has emerged – a situation that is far
more costly in the long-run.
(c) Preventive Maintenance:
 A system of scheduled, planned or preventive maintenance tries to minimize the
problems of breakdown maintenance. It is a stitch-in-time procedure.
 It locates weak spots (such as bearing surfaces, parts under excessive vibrations,
etc.) in all equipment, provides them regular inspection and minor repairs thereby
reducing the danger of unanticipated breakdown.
 The underlying principle of preventive maintenance is that prevention is better than
cure.

29. Preventive Maintenance (or PM) Involves:
(a) Periodic inspection of equipment and machinery to uncover conditions that lead to
production breakdown and harmful depreciation.
(b) Upkeep of plant equipment to correct such conditions while they are still in a minor
stage.
 Preventive maintenance is practised to some extent in about 75% of all
manufacturing companies, but every preventive maintenance programme is
tailored as per the requirements of each company.
 The key to all good preventive maintenance programmes, however, is inspection.
Help can be taken of suitable statistical techniques in order to find how often to
inspect.
Objectives of PM:
(i) To minimize the possibility of unanticipated production interruption or major
breakdown by locating or uncovering any condition which may lead to it.
(ii) To make plant equipment and machinery always available and ready for use.
(iii) To maintain the value of equipment and machinery by periodic inspections, repairs,
overhauls, etc.
(iv) To maintain the optimum productive efficiency of the plant equipment and machinery.
(v) To maintain the operational accuracy of the plant equipment.
(vi) To reduce the work content of maintenance jobs.
(vii) To achieve maximum production at minimum repair cost.
(viii) To ensure safety of the workmen.

30. Elements (or Procedure) of Preventive Maintenance:
(i) There is no ready-made, on-the-shelf, preventive maintenance programme for any
industry. It must be tailor-made-measured and cut to fit the requirements of individual
industry or plant; this is because all industries differ in size, age, location, machinery,
resources, layout, and construction.
(ii) A well-conceived preventive maintenance programme contains the following
elements, features or steps:
1. Who should do PM?
Preventive maintenance may be taken care by:
(a) Production department.
(b) Maintenance department.
(c) A separate division of inspectors, crafts and supervisors.
 The choice depends upon, again, the conditions (such as size, age, location,
machinery, etc.) of the plant.
 However, a perfect coordination between production department and PM
personnel is highly essential for the success of the preventive maintenance practice,
because PM personnel can carry out (preventive) maintenance only when production
department releases the machinery for the same.
 For this reason, certain industries keep PM under production department.
 But as the work load of PM increases, PM is transferred either to maintenance
department or to a separate division of inspectors, crafts and supervisors.

31. Approximate size of preventive maintenance force:
2. Where to start PM?
 One should not apply PM to the entire plant at once.
 PM programme should be built up in pieces; when one piece is finished, start the
next.
 It is better to tackle one section (or department) at a time or one type of machinery
over the entire plant.
 The entire PM programme hangs on inspections and their related duties of
adjustments and repairs.
3. What to inspect in PM?
 Preventive maintenance is costly, therefore one should strike a favourable balance
between this cost and the cost of not utilizing PM.
 Application of PM to all the items in a plant may be uneconomical.
 In almost all industries, there are certain key items which are more essential for
continuing the production than others. In other words, a breakdown of key items
would seriously interrupt production and badly affect production schedule, etc.
A few examples of key-items are as follows:
(i) Material handling equipment such as cranes, lifts, conveyors, hoists, trucks, etc.

32. (ii) Safety equipment such as vacuum and pressure relief valves, flame and flashback
arresters, fire extinguishers; safety alarms, etc.
(iii) Process equipment such as furnaces, compressors, pumps, boosters, motors, pipings,
etc.
(iv) Special purpose—unique equipment and machines.
(v) Water, air and fuel lines.
4. What to inspect for?
 After listing the equipment requiring PM, the next step is to decide-what physical
parts of each piece of equipment need attention.
 These parts can be identified by the craftsmen and supervisors who maintain these
equipment; they, by their experience, know the items liable to wear or equipment
maladjustments taking place under normal conditions.
 Another guide in this matter can be the service manual issued by the equipment
manufacturer.
 After making the list of machines and their parts needing PM, i.e., their inspection
points, one’ makes, a CHECK-LIST to ensure that no inspection point has missed.
5. How often to inspect-frequency?
The decision-how often to inspect is made,
(i) In the light of past experience. For example, if annual inspection keeps a key-item in
perfect running condition, one may not think of inspecting the same every six months.
However, one may try to see if the same key-item will work well if instead annually is
inspected after every 18 months.

33. (ii) Also, on the basis of costs and savings of the PM programme. If the cost of PM is greater
than the savings, one may go for reducing the frequency of inspections.
 The exception is safety standards-they must always take precedence over financial
considerations.
 Over-inspection is needless expensive and may involve more productive downtime
than an emergency breakdown.
 Under-inspection results in (frequent and) more breakdowns and earlier
replacements. A good balance between the two is very essential to bring optimum
saving.
Frequency of inspections may be decided depending upon the following equipment
conditions:
(i) Severity of service and hours of operation, i.e., whether an equipment runs in one shift,
two shifts or for all the 24 hours.
(ii) Age, condition and value of the equipment.
(iii) Safety requirements and health hazards (associated with equipment breakdown).
(iv) Exposure (of equipment) to dirt, friction, fatigue, stresses, corrosion, i.e., the
susceptibility (of the equipment) to wear.
(v) Exposure to vibrations, overloading etc., i.e., susceptibility (of the equipment) to
damage.
(vi) Susceptibility to lose adjustments and the effect of misalignments in the equipment on
production jobs.

34. 6. When to inspect—schedules?
 Scheduling involves determining calendar inspection dates that will fulfil the
frequency requirements in the most efficient way.
 In setting up schedules one must ensure to keep production going at lowest overall
cost.
 Schedules should be set in consultation with production department and as per the
production needs, as far as possible.
PM inspection and service functions can be classified into three following groups:
(i) Routine up-keep, i.e., adjustment, lubrication and cleaning of equipment.
(ii) Periodic inspections, i.e., visual inspections, tear down inspections, overhauls, scheduled
replacement of parts, etc.
(iii) Contingent work (not regular), e.g., inspection of oil burners while relining a furnace.
Routine upkeep or periodic inspections may be scheduled as follows:
(i) Do them in the day-shift (to reduce over-time).
(ii) Spread them over the year to even up the total work load of maintenance.
(iii) Plan them when equipment is not producing, i.e., during set up time, etc.
(iv) Ensure that PM consumes least productive time.

35. Fig. 13.2 shows a PM schedule:
7. Preventive maintenance records:
It is very necessary to keep records because they are the only reliable guides for measuring
the effectiveness of the preventive maintenance programme. Only records tell us, what is
the situation at present and where it is going. Good updated records, proper filing
equipment and adequate clerical help are the backbone of PM programme.
Record keeping is also necessary:
(i) When budgeting for major overhauls.
(ii) When budgeting for general maintenance costs.
(iii) For finding equipment reliability.
(iv) For determining frequency of inspections.
(v) For preparing maintenance schedules.
(vi) For predicting equipment life.
(vii) For designing maintenance cost control systems.

36. (viii) For equipment replacement analysis.
(ix) For carrying out cost reduction studies (e.g., value analysis).
Guidelines to good PM records:
(i) Minimize the number of forms and entries.
(ii) Integrate PM system with other maintenance paper work systems in order to reduce
administrative costs.
(iii) Account for costs of all primary PM inspection activities in order to show what exact
costs are and how far the PM programme is justified.
(iv) Arrange for a periodic control report (weekly or monthly) to check on PM performance.
Records should show:
(i) Type of equipment and its description.
(ii) Whether it is a key item?
(iii) Name of the manufacturer.
(iv) Cost and date of purchase of the equipment.
(v) Location of the equipment in the factory.
(vi) Equipment identification (e.g., chassis) number.
(vii) Inspection of job specification reference number.
(viii) Estimated cost of inspection and the cost and data of planned repairs.

37. (ix) Breakdowns, their dates and reasons.
(x) Cost of breakdowns and other associated implications.
8. Storage of spare parts:
Spare parts are stored in order to reduce the loss of production time.
What spare parts to keep and how much to keep depends upon:
(i) The past experience.
(ii) Advice from plant manufacturers.
(iii) The cost of buying and storing the spares.
(iv) The cost of having idle plant waiting for spare parts in case of a breakdown or at the
time of need.
(v) The ease or difficulty with which the spare parts can be made available when required.
(vi) Whether spare parts are standard or not.
Spare parts once procured should be stored adequately in order to locate them
immediately at the time of need for this:
(i) Spare parts should have stamped code number.
(ii) The stock card may be identified by this number.
(iii) The bin or rack, in which the part is lying, should have its location reference number
recorded on the stock card.
(iv) Spare parts for an equipment may be grouped together and referred to by their plant
number.

38. (v) For locating a part, the storekeeper would first check the stock card bearing the plant
number and take down the bin (or storage rack) reference number. Then, by the code
number of the part, he will identify the required spare part from the many parts lying in
that bin.
9. Control and evaluation of PM:
A PM programme be coordinated and must remain under control at all times.
To maintain control of the PM programme, the following measures should be take:
(i) Periodic review of PM programme with the operating department.
(ii) Review of monthly reports of PM inspections.
(iii) Analytical approach to the evaluation of PM. Analytical approach makes use of
following relations:
(a) Inspections incomplete/ Inspections scheduled x 100 = 10% Max.
(b) Job resulting/Inspections completed x 100 = 20 to 30%
(c) Hours worked as forecast jobs/Total hours worked x 100 = percentage of performance
When plotted, percentage of performance should have a trend either increasing or
stabilized above 80%.
Advantages of PM:
1. Reduced breakdowns and connected down-time.
2. Lesser odd-time repairs and reduced overtime to the maintenance work-force.
3. Greater safety for workers.

39. 4. Fewer large-scale and repetitive repairs.
5. Low maintenance and repair costs.
6. Less stand-by or reserve equipment, and spare parts.
7. Identification of equipment requiring high maintenance costs.
8. Lower unit cost of manufacture.
9. Better product quality and fewer product rejects.
10. Increased equipment life.
11. Better industrial relations because production workers do not face involuntary lay-offs
or loss of incentive bonus because of breakdowns.
(d) Predictive Maintenance:
 It is comparatively a newer maintenance technique.
 It makes use of human senses or other sensitive instruments such as:
 Audio gauges,
 Vibration analyzers,
 Amplitude meters,
 Pressure, temperature and resistance strain gauges, etc., to predict troubles before
the equipment fails.
 Unusual sounds coming out of rotating equipment predict a (coming) trouble; an
electric cable excessively hot at one point predicts a trouble.

40.  Simple hand touch can point out many unusual (equipment) conditions and thus
predict a trouble.
 In predictive maintenance, equipment conditions are measured periodically or on a
continuous basis and this enable maintenance men to take a timely action such as
equipment adjustments, repair or overhaul.
 Predictive maintenance extends the service life of an equipment without fear of
failure.
Schedule of Plant Maintenance:
Maintenance scheduling follows a similar procedure to that outlined for production. It is
required to know that how long a job will take, when it should be done and if resources are
available. Scheduling means determining calendar inspection dates that will fulfill the
frequency requirements in the most efficient way.
Scheduling:
(1) System should be clear, precise and easy to operate,
(2) Should be based upon accurately determined time standards,
(3) Should be finalised in consultation with production department so that the equipment
for maintenance purposes can be spared,
(4) Should aim at creating a balanced work load on each trade section in the department,
that is, each section should be evenly loaded. Maintenance schedule should be flexible.
Maintenance schedule should:
(1) Be such that, the maintenance work can be carried out during lunch hours, between
shifts or at weekends etc.,

41. (2) Take advantage of planned machine stoppages such as tool changes, loading and
unloading of job etc.,
(3) Plan major repairs and overhauls during holidays,
(4) Make use of reserve plant if the need arises.
Procedure:
The scheduling of maintenance work involves essentially two steps:
1. Preparation of master maintenance schedule.
2. Preparation of Detailed weekly or daily schedule.
Master maintenance schedule indicates the nature and magnitude of each repair and
construction task segment of maintenance for a specified time span.
Considering total man hours needed for each task segment and the manpower available,
the distribution of jobs (that will give reasonable man loadings, and can be accomplished) is
done. A master schedule is flexible and a cushion always exists to accommodate,
unanticipated tasks and jobs which are lagging behind schedule. Detailed schedules are
prepared by breaking overall time spans allocated under master schedule.
Detailed weekly work schedule provides information to each craft and shop regarding the
task to be carried on each job for each day in the coming week. Detailed scheduling
requires records of work capacity of each section of the maintenance department and of
the maintenance department as a whole. Like master schedule, the detailed schedule
should also be flexible and able to accommodate emergency jobs. Detailed schedule may
be issued to concerned persons every day or near the week-end.
Maintenance schedule of each machine may be prepared and it will indicate the list of
works which must be carried out (together with the frequency) and will contain servicing,
adjustments, lubrication details and particulars of replacement work. Fig. 13.3 shows the
schedule of maintenance.

42. Scheduling Tools (Devices):
They are classed as:
1. Visual charts.
2. Scheduling boards.
3. Individual cards.
1. Visual chart is shown in Fig. 13.3.
2. Scheduling boards.
3. Individual cards.
As compared to scheduling board, individual cards contain more written details and can be
used for historical records.

43. Standard Data for Plant Maintenance:
No maintenance programme can be accurately developed and maintained without
various standards such as:
(i) Time standards which indicate the time to complete a maintenance job.
(ii) Lubrication standards which mark the interval between lubrications, etc.
Purpose:
Maintenance standards are used for:
(i) Planning and scheduling maintenance work.
(ii) Providing fair number of maintenance-men.
(iii) Measuring the output or effectiveness of performance of maintenance—men.
(iv) Providing incentive earnings for maintenance—men.
Setting and Using Standard Data:
Owing to the variable, non-repetitive nature of maintenance work, a great deal of technical
study is required before the standard data assembled represents sufficient coverage of the
work to do effective planning. Standard data derived from time studies is probably the
most widely used system for applying sophisticated labour control to maintenance
departments. For an individual concern, to collect standard data, would require many
engineering hours and thus make it prohibitive because of initial cost.
However, there are management consulting firms who have assembled standard data (for
maintenance) and have established programmes that are available to clients for installation
of maintenance controls. Table 13.1 gives an example of Maintenance Standard Data.

44. Table 13.2 shows the method to calculate the time required to install a machine with the
help of standard maintenance data.
Advantages of Using Standard Data for Maintenance Control:
1. Consistent estimating of maintenance jobs.
2. Elimination of delays through improved scheduling.

45. 3. Improved supervisory controls.
4. Alternate methods of maintenance can be properly weighed and compared.
5. Determination of labour content for each craft provides proper coordination of crafts.
6. Through application of maintenance standards and proper estimating, the work backlogs
can be adjusted as required.
7. Through controlled means, the fluctuations in maintenance requirements are handled
properly.
8. Standard data forms a basis for accurately evaluating, forecasting and controlling
maintenance expenditures.
Some Recent Developments in Plant Maintenance:
In recent years there has been a tendency to use a variety of management techniques for
plant maintenance.
These techniques have led to:
(i) An increase in maintenance efficiency.
(ii) Reduced maintenance costs.
(iii) Improved services.
(A) Use of Work study:
Work study can improve maintenance scheduling and eliminate a great deal of frustration
and anxiety on the part of production supervision.

46. (B) Use of Network Planning Techniques:
(i) CPM has enabled some firms to cut their downtime by 20 to 30%.
(ii) Maintenance costs have been cut down.
(iii) Plant utilization has been raised.
(iv) CPM is very useful for planning and control of large maintenance projects.
(v) Dramatic reductions in time (about 70%) were experienced with the overhaul of
generating plant by Central Electricity Generating Board in Great Britain, by using network
planning techniques.
(vi) When applied to the maintenance and overhaul of a refinery, PERT reduced its
shutdown time from 18 to 16 days and thus added 90,000 barrels to its production volume.
(C) Use of Operations Research:
Operations Research handles maintenance problems such as the economic level of spare
parts or when to replace an item, etc.
(D) Use of Computers:
Computers when used for managing maintenance problems provide more efficient
operation and control. Computers can prepare maintenance work orders giving accurate
work order descriptions and job timing.
The following improvements over manual systems of PM have been claimed by using a
computerized system of preventive maintenance:
(i) Eliminated human error in preparing work order, etc.
(ii) Reduced cost of keeping records of equipments, etc.

47. (iii) Reduced premature replacement of parts.
Introduction
Production Planning is a managerial function which is mainly concerned with the following
important issues:
 What production facilities are required?
 How these production facilities should be laid down in the space available for
production? and
 How they should be used to produce the desired products at the desired rate of
production?
Broadly speaking, production planning is concerned with two main aspects: (i) routing or
planning work tasks (ii) layout or spatial relationship between the resources. Production
planning is dynamic in nature and always remains in fluid state as plans may have to be
changed according to the changes in circumstances.
Production control is a mechanism to monitor the execution of the plans. It has several
important functions:
 Making sure that production operations are started at planned places and planned
times.
 Observing progress of the operations and recording it properly.
 Analyzing the recorded data with the plans and measuring the deviations.
 Taking immediate corrective actions to minimize the negative impact of deviations
from the plans.
 Feeding back the recorded information to the planning section in order to improve
future plans.

48. A block diagram depicting the architecture of a control system is shown in Figure1.
Important functions covered by production planning and control (PPC) function in any
manufacturing system are shown in Table1along with the issues to be covered.
Functions Issues to be covered
Product Design &
Development
Customer needs, market needs, availability of similar product, demand-
supply gap, functional aspects, operational aspects, environmental
aspects etc.
Demand
Forecasting
Quantity, Quality, Demand pattern.
Capacity Planning No. of machines, No. of tooling, workers, No. of flow lines, Quantity,
Quality and rate of production, demand pattern.
Equipments
Selection &
Maintenance
No. of machines, type of M/c, Quality aspects, Quantity aspects, rate of
production, Cost of equipments, support from the supplier,
maintenance policy, storage of spare parts.
Tooling Selection No. of tools, their cost, their material etc, storage policy.
Material Selection
& Management
Types, specification, quality aspect, quantity aspect, cost, supplies
reputation , lot size, inventory levels, setup cost, mode of transportation
etc.
Process Planning Generation of manufacture instruction, selection of M/c, tools,
parameters, sequence etc.
Loading Division of work load, assignment of tasks, uniform
loading, matching between capability & capacity with job requirements.
Routing Path selection for material movement as per the process plan and
loading, minimum material handling and waiting time.
Scheduling Time based loading, start and finish times, due dates, dispatching rules,

49. re-scheduling.
Expediting Operation Scheduling and order and progress reporting.
Elements of Production Planning and Control in an Organization
Some of the important elements involved in the process of production planning and control
in organization are: (a) Planning; (b) Routing; (c) Scheduling; (d) Despatching; (e) Checking
the progress or follow-up and (f) Inspection.
(a) Planning:
 This is the first and the most important element of production planning and control.
Planning refers to deciding in advance what is to be done in future.
 A separate planning department is established in the organisation which is
responsible for the preparation of policies and plans with regard to production to be
undertaken in due course.
 While explaining the concept of scientific management, F.W. Taylor emphasised the
need of separating planning function from the function of actual operation in an
organisation.
 For successful implementation of production control, production planning is of
utmost importance.
 The planning department prepares various charts, manuals production budgets etc.,
on the basis of information received from management.
 These plans and charts or production budgets are given practical shape by carrying
various elements under production control.
 If production planning is defective, production control is bound to be adversely
affected.
 For achieving the production targets, production planning provides sound basis for
production control.
(b) Routing:
 Production routing is a process concerned with determining exact route or path, a
product has to follow right from raw material till its transformation into finished
product. A few definitions of routing can be cited here:—
“Routing may be defined as the selection of paths or routes over which each piece is to
travel in being transformed from raw material into finished product”.

50. —Kimball and Kimball Jr.
“Production routing involves the planning of the exact sequence of work stations to be used
in processing a part of product. Once a layout has been established the routing of an item is
the determination of the path that item should follow as it is manufactured”.
—James C. Lundy
“Routing is the specification of the flow or sequence of operations and processes to be
followed in producing a particular manufacturing lot”.
—Alford and Beatty
“Routing includes the planning of where and by whom work shall be done, the
determination of the path that work shall follow and the necessary sequence of operations;
it forms a groundwork for most of the scheduling and dispatching functions of planning
department.”
—Spriegel and Lansburgh
The above mentioned definitions clearly lay down that routing is concerned with the
selection of the most economical and appropriate path for the product in the process of
final completion from raw material to finished product.
Objects of routing:
 The main objective of routing is to lay down the best and the most economical
sequence of operations to be undertaken in the process of production.
 Another objective of routing is to determine proper tools and equipments and the
required number of workers required for doing or carrying total production
processes in an organisation.
 Routing becomes automatic and continuous in case of continuous manufacturing
units where standardized products are produced by undertaking standardized
production operations.
 On the other hand, in case of job order units or intermittent- process industries such
as ship building, every product requires different designs and varying sequences of
operations.
Procedure followed in routing:
In case where a new product is going to be produced, different steps are involved in a
total routing procedure. These steps are:

51. (a) Complete analysis or study of the product as to decide what parts of the product are to
be manufactured and what may be purchased from the market.
(b) Analysis of the article so as to know what sorts of materials are needed for producing
the article or product. This includes the complete study with regard to quality, quantity,
kind and grade of materials required.
(c) To determine different manufacturing operations and their sequence. This can be
worked out by knowing accurately about the machines and their layout. This also
necessitates the knowledge of allied equipment, jigs, tools and implements needed for
efficient production.
(d) Determining lot to proper size in relation to order placed by the customers.
(e) Possibility of scrap in manufacturing a product must be properly determined.
Anticipated scrap should be compared with actual scrap. Steps should be undertaken to
control excess scrap.
(f) Determination of the cost of the article or the product produced must be properly
worked out. Calculation of total cost and per unit cost production is primarily the job of
costing department, but still cost estimates pertaining to direct material, direct labour,
direct expenses and indirect expenses and overheads must be prepared by the production
department. These estimates will be greatly helpful for the costing department.
(g) Complete information pertaining to different types of production control forms viz.,
time and job cards, inspection cards and tool tickets, etc. must be kept by the works
manager. This will be very helpful in carrying planned and systematic production.
(h) Preparation of route sheets is another important step in routing procedure. Route
sheets relate to specific production orders. One sheet is prepared for each part or
component of the product.
Route sheets also indicate the sequence of operations to be undertaken and also contain
various requirements of production viz., men, materials and machinery etc. Route sheets
also indicate total number of pieces to be produced and number of pieces to be included in
each lot where production is carried in lots.
It must be remembered that routing is a complex and tedious process as such it should be
entrusted to an expert who knows all the intricacies and complexities of production
operations.
A number of factors viz. human considerations, plant layout, type of production undertaken
and processes employed and type of equipment being undertaken must be kept in mind
before selecting a proper route for production.

52. (c) Scheduling:
 Scheduling in simple words means fixation of time and date when each operation is
to be commenced and completed.
 It is an important part of production control as all future process of production is
based on it.
 Scheduling lays down ground work for all subsequent steps in production process.
A few definitions of scheduling are given as under:
“The determination of the time that should be required to perform each operation and also
the time necessary to perform the entire series as routed, making allowance for all factors
concerned.”
—Kimball and Kimball Jr.
“Scheduling involves establishing the amount of work to be done and the time when each
element of the work will start, or the order of work. This includes allocating the quality and
rate of output of the plant or department and also the date or order of starting each unit of
work at each station along the route prescribed.”
—Spriegel and Lansburgh
“Work Scheduling consists of the assignment of starting and completion times for the
various operations to be performed.”
—James C. Lundy
“The detailed planning of material, labour and machine time, so that materials and parts
will be at the right place and at the right time so that a job can be completed within the
time planned and in accordance with the requirements.”
—John D. Mclellan
From the above mentioned definitions, it is clear that scheduling is concerned with
allocating time for each operation of production and finally total time in the completion of
production.
Types of scheduling:
Scheduling is of three types:
(a) Master scheduling;
(b) Manufacturing or operation scheduling;

53. (c) Retail operation scheduling.
(a) Master scheduling:
 It relates to a specified period; say a month, a week or a fortnight.
 It contains production requirements of a single product or different products during
the specified period of time.
 It is easier to prepare master schedule for a single product, but difficulty arises where
the number of products are more. It is also known as over-all schedule.
 The preparation of master schedule varies from industry to industry according to
type of production undertaken by them.
 Master schedule usually contains information pertaining to direct material
requirements, estimated requirements in man-hours per product at various work
centres and estimated overhead expenses etc.
(b) Manufacturing or operation scheduling:
 Manufacturing schedules are prepared in case of process or continuous type of
industries.
 In case of mass production industries, where uniform products of same size, colour
and design etc., are produced, manufacturing schedules can be easily prepared.
 But in case where a product is produced in different sizes, quantity, colour and
design, it is bit difficult to prepare manufacturing schedule.
 The important information contained in this schedule relates to name, number of the
product, quantity to be produced each day, week or any other stipulated time.
(c) Detail operation scheduling:
 This type of schedule relates to allocation of time for each production operation
within each machine and manufacturing process in the organisation.
 Both routing and scheduling are important elements in the process of product
control.
 They are interdependent on each other.
 Proper route cannot be assigned to a product without proper schedule, at the same
time schedules cannot be prepared properly without the knowledge of exact route of
production.

54. (d) Dispatching:
 Dispatching relates to the process of initiating production in accordance with pre-
conceived production plan.
 It is concerned with giving practical shape to the production plan.
 This includes issuing necessary orders and instructions and other important
guidelines and information pertaining to work.
Some important definitions of dispatching are enumerated here:
“A good definition of dispatching is the routine of setting productive activities in motion
through the release of orders and instructions, in accordance with previously planned times
and sequences, embodied in route sheet and schedule charts.”
—Afford and Beatty
“Despatches put production in effect by releasing and guiding manufacturing orders in the
sequence previously determined by route sheets and schedules.”
—John A. Shu bin
“The despatching function involves the actual granting of permission to proceed according
to plans already-laid down. This is similar in case of the traveller, to his employer finally
approving his vacation leave.”
—James L. Lundy
By reading the above mentioned definitions, it can be laid that despatching is concerned
with putting the production plan into action. It is concerned with the attainment of
production orders by supplying materials, arranging machines and required workers, for
different production orders.
Procedure or steps followed in dispatching:
Following steps are undertaken in discharging the function of dispatching’:
1. Issuing materials from stores to different production processes.
2. Assignment of work to various machines and work places.
3. Procuring necessary tools, equipment and fixtures to be issued to workmen as and when
needed.

55. 4. Issuing necessary work orders, giving instructions and other information with regard to
work to the workers.
5. To record and maintain the time taken from starting to completion of each job and also
recording the total production time.
6. After the completion of work, all tools, implements, drawings and charts etc., to be
returned to respective issuing departments.
7. Recording idle time of machines and workers.
a. To have liaison with routing and scheduling departments for effective performance.
Types of Despatching:
Despatching is of two types viz.,
(a) Centralised and
(b) Decentralised.
(a) Centralised despatching:
 Under this system there is a centralised despatching section from where orders and
instructions are directly issued to workmen and machines.
 This system of despatching ensures greater control and flexibility in its operation.
(b) Decentralised despatching:
 This is just the reverse of the first method.
 Under this system, work orders are sent to the foreman of each department.
 It is the duty of the departmental head to adjust the process and sequence of work in
accordance with the requirements of the department.
 This system minimises production delays, duplication of postings and other
drawbacks involved in centralised dispatching.
 The most important drawback of this system is that there are difficulties in achieving
co-ordination in different departments and more clerical work is involved.
Various cards and forms used in carrying the functions of dispatching are:
(i) Material requisitions:
These are sent by workers working on different jobs for getting supply of materials from
stores.

56. (ii) Job Cards:
These cards are issued to each individual worker who enters his performance and time
taken on a job.
(iii) Move tickets:
These tickets authorize the movement of materials in between various production
operations.
(iv) Tool and gauge tickets:
These tickets authorize the issue of various tools and equipment from stores.
(v) Inspection Cards:
These cards show the quantity of work passed and rejected at each inspection point.
(e) Checking the progress or Follow-up:
 Follow-up or expediting function relates to evaluation and appraisal of work
performed.
 If goods are to be produced as planned, proper follow up or expediting must be
undertaken.
 A properly planned follow up procedure is helpful in finding errors and defects in the
work and it also suggests remedial measures.
In the words of Bethel, Atwater etc.,“Follow up or expediting is that branch of production
control procedure which regulates the progress of materials and part through the
production process”
 The function of follow-up is carried by ‘follow-up men’.
 These men act as intermediaries between various departments bringing about co-
ordination between them. ‘Follow-up men’ are also referred as expeditors, ‘go-
betweens’, ‘stock chasers’ and ‘progress-men’ etc.
 Follow-up function can be applied in accordance with product or process layout.
Follow up under product layout is easier to undertake as the follow-up men are
responsible for the progress of a single product from inspection to packing.
 On the other hand, follow-up under process layout is difficult to carry on account of
scattered departments.
 Different follow-up men are appointed in different department’s viz., lathe
department, welding department and finishing department etc.

57. In brief the element of follow up is concerned with the following three steps,
(a) To review the present situation with regard to materials, work-in-progress and finished
products.
(b) Expediting the performance of those departments which lag behind.
(c) Removing obstacles in the way of production for smooth and uninterrupted flow of
production.
(f) Inspection:
 This is the last but not the least component in the process of production planning and
control.
 The function of inspection is primarily carried to ensure whether desired quality of
products has been achieved or not.
 Inspection is carried out at different levels of production activity.
In the words of Kimball and Kimball Jr.
“Inspection is the art of comparing materials, product or performance with established
standards.”
 Inspection of product at every stage, raw material, work in progress or semi finished
goods and finished goods may be undertaken.
 Plant, machinery, equipment and tools used in production may also be inspected.
 For conducting inspection, specialised laboratories may be set up.
 The most important benefit derived from inspection is that it ensures pre-
determined quality and minimises wastage and rejected products.

58. The advantages of production planning and control are as follows:
(i) Efficient Use of Resources:
An efficient system of production planning and control is supported by a good quality
control procedure which helps in the efficient utilisation of materials, machines and the
time of the workers.
(ii) Coordination:
Production planning and control can be used as an instrument of formalising coordination
in purchasing, marketing, quality control, cost control and other activities related to the
production of goods and services.
(iii) Economy:
There is better utilisation of plant capacity and working time as everything is planned well
in advance of the operations.
(iv) No Bottlenecks:
Since there is an even flow of production through production control, bottlenecks are
avoided.

59. (v) Inventory Control:
It helps in maintaining proper levels of inventory of different kinds of materials and work-
in-process.
(vi) Public Image:
Proper scheduling of manufacturing operations facilitates meeting the delivery dates. The
customers get the goods of proper quality in time. This creates a good public image of the
enterprise.
The limitations of production planning and control are discussed below:
1. Production planning is based on certain assumptions about customers’ order, plant
capacity, availability of materials and power, etc. If these assumptions go wrong, the
process of production planning and control will go weak.
2. Production planning and control may bring rigidity in the behaviour of employees
who may resist it and try to sabotage it.
3. Production planning is a time-consuming process. Small firms can’t afford to spend
so much time in planning.
4. Production planning and control is a costly device as its implementation requires
separate persons to perform the functions of planning, dispatching, executing, etc.
Small firms cannot afford to use the services of specialists for the effective
performance of these functions.
5. The effectiveness of production planning and control is sometimes reduced due to
external factors which are beyond the control of production manager. Break down of
power, government control, natural havoc; change in technology, change in fashion,
etc. are some of the factors which adversely affect the implementation of production
planning and control.
Types of Production: with it’s Characteristics and Limitations
Some of the most important types of production are:
(i) Job Production
(ii) Batch production and
(iii) Mass or flow production!

60.  A production manager will have to choose most appropriate method for his
enterprise.
 The final decision regarding any particular method of production is very much
affected by the nature of the products and the quantity to be produced.
 Production methods may be broadly classified as Job Production, Batch production
and Mass or Flow Production.
(i) Job Production:
 Under this method peculiar, special or non-standardized products are produced in
accordance with the orders received from the customers.
 As each product is non- standardized varying in size and nature, it requires separate
job for production.
 The machines and equipment’s are adjusted in such a manner so as to suit the
requirements of a particular job.
 Job production involves intermittent process as the work is carried as and when the
order is received.
 It consists of bringing together of material, parts and components in order to
assemble and commission a single piece of equipment or product.
 Ship building, dam construction, bridge building, book printing are some of the
examples of job production.
 Third method of plant layout viz., Stationery Material Layout is suitable for job
production.
Characteristics:
 The job production possesses the following characteristics.
1. A large number of general purpose machines are required.
2. A large number of workers conversant with different jobs will have to be
employed.
3. There can be some variations in production.
4. Some flexibility in financing is required because of variations in work load.
5. A large inventory of materials, parts and tools will be required.
6. The machines and equipment setting will have to be adjusted and readjusted to
the manufacturing requirements.
7. The movement of materials through the process is intermittent.
Limitations: Job production has the following limitations:
1. The economies of large scale production may not be attained because production is
done in short-runs.

61. 2. The demand is irregular for some products.
3. The use of labour and equipment may be an inefficient.
4. The scientific assessment of costs is difficult.
(ii) Batch production:
 Batch production pertains to repetitive production.
 It refers to the production of goods, the quantity of which is known in advance.
 It is that form of production where identical products are produced in batches on the
basis of demand of customers’ or of expected demand for products.
 This method is generally similar to job production except the quantity of
production.
 Instead of making one single product as in case of job production, a batch or group
of products are produced at one time.
 It should be remembered here that one batch of products may not resemble with
the next batch.
 Under batch system of production the work is divided into operations and one
operation is done at a time.
 After completing the work on one operation it is passed on to the second operation
and so on till the product is completed.
Batch production can be explained with the help of an illustration. An enterprise wants
to manufacture 20 electric motors.
 The work will be divided into different operations.
 The first operation on all the motors will be completed in the first batch and then it
will pass on to the next operation.
 The second group of operators will complete the second operation before the next
and so on.
 Batch production can fetch the benefits of repetitive production to a large extent, if
the batch is of a sufficient quantity.
 Thus batch production may be defined as the manufacture of a product in small or
large batches or lots by series of operations, each operation being carried on the
whole batch before any subsequent operation is operated.
 This method is generally adopted in case of biscuit and motor manufacturing,
medicines, tinned food and hardware’s like nuts and bolts etc.

62. The batch production method possesses the following characteristics:
1. The work is of repetitive nature.
2. There is a functional layout of various manufacturing processes.
3. One operation is carried out on whole batch and then is passed on to the next operation
and so on.
4. Same type of machines is arranged at one place.
5. It is generally chosen where trade is seasonal or there is a need to produce great variety
of goods.
(iii) Mass or flow production:
 This method involves a continuous production of standardized products on a large
scale.
 Under this method, production remains continuous in anticipation of future
demand.
 Standardization is the basis of mass production.
 Standardized products are produced under this method by using standardized
materials and equipment.
 There is a continuous or uninterrupted flow of production obtained by arranging the
machines in a proper sequence of operations.
 Process layout is best suited method for mass production units.
 Flow production is the manufacture of a product by a series of operations, each
article going on to a succeeding operation as soon as possible.
 The manufacturing process is broken into separate operations.
 The product completed at one operation is automatically passed on to the next till its
completion.
 There is no time gap between the work done at one process and the starting at the
next.
 The flow of production is continuous and progressive.
Characteristics:
 The mass or flow production possesses the following characteristics.
1. The units flow from one operation point to another throughout the whole
process.
2. There will be one type of machine for each process.
3. The products, tools, materials and methods are standardised.

63. 4. Production is done in anticipation of demand.
5. Production volume is usually high.
6. Machine set ups remain unchanged for a considerable long period.
7. Any fault in flow of production is immediately corrected otherwise it will stop
the whole production process.
Suitability of flow/mass production:
1. There must be continuity in demand for the product.
2. The products, materials and equipments must be standardised because the flow of line is
inflexible.
3. The operations should be well defined.
4. It should be possible to maintain certain quality standards.
5. It should be possible to find time taken at each operation so that flow of work is
standardised.
6. The process of stages of production should be continuous.
Advantages of mass production:
 A properly planned flow production method, results in the following advantages:
1. The product is standardized and any deviation in quality etc. is detected at the
spot.
2. There will be accuracy in product design and quality.
3. It will help in reducing direct labour cost.
4. There will be no need of work-in-progress because products will automatically pass
on from operation to operation.
5. Since flow of work is simplified there will be lesser need for control.
6. A weakness in any operation comes to the notice immediately.
 7. There may not be any need of keeping work-in-progress, hence storage cost is
reduced.
Job:
 Bridge, buiding, tailor, architect, hairdresser, Film production
Batch
 Bakers, cold drinks, clothing, electronic instruments, Paint and wallpaper
manufacturers, cricket bats, bicycles

64. Mass
 Cars, electronic chips, soaps