Operations Management

OPERATIONS MANAGEMENT

Project report on

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CONTENTS

1. EXECUTIVE SUMMARY…………………………………………………………5
2. INTRODUCTION…………………………………………………………………..6
3. BACKGROUND OF THE PROJECT………………………………...…………….8
4. OBJECTIVE OF THE STUDY………………………………………...……………9
5. SCOPE OF THE STUDY…………………………………………………...……….9
6. METHODOLOGY………………………………………………………….………10
7. EXISTING SYSTEM……………………………………………………….……….11
8. PLC METHODOLOGY………………………………………………………...……16
9. MACHINES IN OPERATION……………………………………………………....17
12. THE PRODUCTION PROCESS……………………………...……………………21

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13. QUALITY MANAGEMENT………………………………………………………26
14. RECOMMENDATIONS…………………………………………………………...27
15. APPENDIX………………………………………………………...……………….30
16. REFERENCES……………………………………………………………………...32

TABLE OF FIGURES

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1. SITE LAYOUT PLAN………………………………………………..7

2. MACHINES DESCRIPTION……………………………..………17-20

3. EXPECTED PLANT LAYOUT……………………………………...25

EXECUTIVE SUMMARY

Albert David India is a manufacturing unit, producing antibiotic gelatin tablets and Intravenous
fluids. The company has operations in several places including Kolkata, Ghaziabad and Bhopal.

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We have carried on the project on the Ghaziabad manufacturing unit and tried to understand the
operations and the manufacturing process there. Along with this we have studied the layout plan
and the site plan of the centre and tried to identify the advantages and disadvantages of the
existing system. The report is based on what we found out from the primary observation and also
from secondary research. Through this report we have tried to comprehensively cover the whole
operations and thereby suggest recommendations that can improve the process as a whole.

INTRODUCTION
Albert David India, the company:
Albert David, headquartered in Kolkata, is a leading, fast growing and a professionally managed
pharmaceutical company in Eastern India. During the current fiscal year, the company has

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achieved an excellent annual sales turnover of Rs 87 Crores (1,95,50,000 $) and ranks 58th out
of 22,000 plus companies competing in the Indian pharma market.
The current operations of the company can be classified as:
• Pharmaceutical formulations and bulk drugs in our Kolkata manufacturing unit.
• Infusion solutions and oral solids at Ghaziabad factory.
• Disposable syringes and needles at Mandideep plant & Herbal formulations at the
Bangalore unit.
• We export these products to Vietnam, Russia, Belarus, Egypt, Bangladesh,
Kenya, Tanzania, Uganda, Sudan, Ethiopia, Nigeria, Zaire, Haiti, Brazil, Canada,
USA, UK, Netherlands and Germany.
The company covers 1,25,000 retail outlets. More than 400 highly trained, dedicated
pharmacy/science graduates constitute the field marketing team.

The Ghaziabad unit:
The Ghaziabad unit established in 1981, spans a total area of 20435.00 sq. mtrs and a covered
area of 7367.28 sq. mtrs. (GF) and 6398.42 sq. mtrs. (FF) respectively. The company has
introduced intravenous fluid section in glass bottles and polythene containers from 1981 and
1985 onwards. Manufacturing of Soft Gelatin capsules and hard gelatin capsules have started
from 1988 onwards. Special solutions like amino acid intravenous infusion were introduced in
the year 1987 in collaboration with Morishita Pharmaceuticals Ltd., a sister concern of world
famous Ajino Moto Co., Inc., Japan.

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Exhibit 1: Site Layout Plan of Albert David

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BACKGROUND OF THE PROJECT
Medicines play a critical role in delivering effective and efficient health care for patients.
Pharmaceuticals procurement is a key component of medicines management, with the supply
chain providing the critical link between the manufacturer and the patient. It is integrated with
medicines management and needs to be designed to ensure the right medicines are available for
patients at the right time. Typically, other developments in hospital pharmacy have assumed
higher priority than the supply chain. It was against this background that the pharmaceutical
supply chain project was established in 2001.
The last year or two has seen a significant increase in complaints from hospitals at Ghaziabad
and from wholesalers of other regions about the performance of the supply chain for
pharmaceuticals, centering on dissatisfaction with the service provided by the company. The
demand for medicines has increased a lot in the recent past. However, the production and supply
have not increased to that extent. Despite being an industrial area, a large chunk of the required
medicines is still supplied by adjoining regions. To address this issue, Albert David can
capitalize the situation and grow.
Expansion has been a regular activity for Albert David. On an average a moderate expansion
plan is executed every 30 months or so. A major expansion and introduction of PLC in the
process has been implemented in April this year. They also expect another large expansion in
September 2008. Such trends are also visible in past. Keeping in mind such expansion plan, we
think we have the opportunity to suggest any long term changes if necessary.

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OBJECTIVE OF THE STUDY
As a part of the Operations Management project analysis we want to have a first hand
understanding of the various processes in a pharmaceutical manufacturing industry. The broad
objectives of our project are as follows:
1. To learn about the processes involved in the production of antibiotics
2. To learn about the processes involved in the production of glucose and saline solution
3. To study the contribution made by their information system towards the operational
efficiencies.
4. To learn about the functioning of various machines and their integration with the help of
PLC methodology
5. Suggest recommendations, if any, to improve the efficiency and quality control measures
of the unit.

SCOPE OF THE STUDY
We had very limited time duration to study the processes of the company. The in depth study of
the process and minute examination of each of the steps of the production process was not
allowed to us as the organisation had concerns regarding the secrecy of the process in respect to
their competitors. However, the authorities were kind enough to let us know the names of
various machines that were used in the process. We also got to know regarding the steps in the
production process. Given our understanding of Operations Management as a subject, we have
tried to develop an overall understanding if the processes of the manufacturing unit. Along with
this we tried to develop the understanding of the workings of various machines by surfing

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through various websites. The images of the machines given here are the ones which we got
from the websites. We have tried to link the various information we collected through our
primary investigation with those we have gathered through secondary research.

METHODOLOGY
The sources of data used are primarily through interview of the general manager and operations
personnel. Journals and magazines, existing research and various websites were used for
secondary research. The steps involved in completion of our project can be depicted as under:

OBJECTIVE
FORMULATION

COMPANY VISIT

PROCESS STUDY

PROCESS ANALYSIS

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RECOMMENDATIONS

CONCLUSION

EXISTING SYSTEM
Broadly, the hierarchy of Albert David can be divided into three levels. At the top of the
managerial group here we have executives who make policy decisions concerning matters of
finance, marketing, and research. Other managerial workers include industrial production
managers. Manager finance handles the finance department to control the daily financial
transactions. Marketing manager deals with activities related to distribution and marketing of
manufactured products to various wholesalers, distributors and direct customers including local
hospitals. Manager research deals with all activities of quality control and testing, Albert David
does not have separate research department because all the research regarding composition and
constituents of drugs takes place in its head quarter at Kolkata. Manager production deals with
production department and has a responsibility of putting demanded orders on time.
Here office and administrative support employees include secretaries and administrative
assistants, general office clerks, and others who keep records on personnel, payroll, raw
materials, sales, and shipments. Sales representatives, wholesalers and distributors, describe the
company’s products to physicians, pharmacists, and health services administrators. These three
serve as lines of communication between their companies and clients.

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Most plant workers fall into 1 of 2 occupational groups: Production workers who operate drug-
producing equipment, inspect products, and install, maintain, and repair production equipment;
and transportation and material moving workers who package and transport the drugs. Workers
among the larger of the production occupations, assemblers and fabricators, perform all of the
assembly tasks assigned to their teams, rotating through the different tasks rather than
specializing in a single task. They have the flexibility to decide how the work is to be assigned
and how different tasks are to be performed.
Other production workers specialize in one part of the production process. Chemical processing
machine setters, operators control machines that produce tablets, capsules, and medicinal
solutions including various types of glucose. Included among these operators are mixing and
blending machine setters, operators, who tend milling and grinding machines that reduce
mixtures to particles of designated sizes. Extruding, forming, pressing, and compacting machine
setters, operators tend tanks and kettles in which solutions are mixed and compounded to make
up desired medicine. Crushing, grinding, polishing, mixing, and blending workers operate
machines that compress ingredients into tablets. Coating, painting, and spraying machine setters,
and operators, often called capsule coaters, control a battery of machines that apply coatings that
flavor, color, preserve, or add medication to tablets. In RO treatment plant operators have a basic
job of maintaining pressure and controlling the flow of filtered water to final processing unit.
Throughout the production process, inspectors, testers, and weighers ensure consistency and
quality. For example, ampoule examiners inspect ampoules for discoloration and foreign
particles. Tablet testers inspect tablets for hardness, chipping, and weight to assure conformity
with specifications. After the drug is prepared and inspected, it is bottled or otherwise packaged
by packaging and filling machine operators and tenders. Prepared glucose solution is sent to
bottling plant where it is filled in plastic bottles which are procured from outside.
Plant workers who do not operate or maintain equipment perform a variety of other tasks. Some
drive industrial trucks or tractors to move materials around the plant load and unload trucks and
railroad cars, or package products and materials by hand.
Inspectors, testers, and weighers are involved at every stage of the production process. Some
inspectors examine materials received from a supplier before sending them to the production
line. Others inspect components and assemblies or perform a final check on the finished product.

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Depending on their skill level, inspectors also may set up and test equipment, calibrate precision
instruments, repair defective products, or record data.
Inspectors mark, tag, or note problems. They may reject defective lot outright, send them for
remanufacturing if possible, or fix minor problems themselves. If the lot is acceptable,
inspectors stamp it with a serial number to certify it as quality approved.
Inspectors, testers, and weighers record the results of their inspections, compute the percentage
of errors and other statistical measures, and prepare inspection and test reports. When defects are
found, inspectors notify supervisors and help to analyze and correct the production problems.
The emphasis on finding the root cause of error is a basic job of this inspection team. Industrial
production managers work closely with the inspectors to reduce defects and improve quality. In
the past, a certain level of defects was considered acceptable because variations would always
occur. But due to current rigorous standards constant quality improvement through analysis and
correction of the causes of error is required.

Role of IT
Computers have become an integral part of industrial production; they play an important role in
day-to-day administration, maintenance, and support of production activities.
One obstacle associated with expanding computer use is the need for different computer systems
to communicate with each other. Because of the importance of maintaining up-to-date
information—accounting records, sales figures, or budget projections, for example—systems
analysts work on making the computer systems within an organization, or among organizations,
compatible so that information can be shared among them. Many systems analysts are involved
with “networking,” connecting all the computers internally—in an individual office, department,
or establishment—or externally, because many organizations rely on e-mail or the Internet. A
primary goal of networking is to allow users to retrieve data from a mainframe computer or a
server and use it on their desktop computer. Systems analysts must design the hardware and
software to allow the free exchange of data, custom applications, and the computer power to
process it all. For example, analysts are called upon to ensure the compatibility of computing
systems between and among businesses to facilitate electronic commerce.

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In the core work process IT and computers also play a vital role in transforming manual process
to semi-automated machines and semi-automated machines to fully automated ones. For
example, in case of Programmable Logic Controllers, the use of IT is highlighted to a great
extent. It helps to automatically execute the sequence of steps in the manufacturing process.
Thereby it ensures that all the steps are rigidly followed in the correct order. It also acts a device
for quality control by ensuring that all the nitty-gritty of the process is taken care of.

Working Conditions
Technical support specialists answer telephone calls from their organizations’ computer users
and may run automatic diagnostics programs to resolve problems. Working on monitors,
keyboards, printers, and mice, they install, modify, clean, and repair computer hardware and
software. They also may write training manuals and train computer users in how to use new
computer hardware and software. In addition, technical support specialists oversee the daily
performance of their company’s computer systems and evaluate software programs with regard
to their usefulness.
Help-desk technicians assist computer users with the inevitable hardware and software questions
that are not addressed in a product’s instruction manual. Help-desk technicians field telephone
calls and e-mail messages from customers who are seeking guidance on technical problems. In
responding to these requests for guidance, help-desk technicians must listen carefully to the
customer, ask questions to diagnose the nature of the problem, and then patiently walk the
customer through the problem-solving steps.

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Help-desk technicians deal directly with customer issues, and companies value them as a source
of feedback on their products. These technicians are consulted for information about what gives
customers the most trouble, as well as other customer concerns. Most computer support
specialists start out at the help desk.
Network administrators and computer systems administrators design, install, and support an
organization’s local-area network (LAN), wide-area network (WAN), network segment, Internet,
or intranet system. They provide day-to-day onsite administrative support for software users in a
variety of work environments, including professional offices, small businesses, government, and
large corporations. They maintain network hardware and software, analyze problems, and
monitor the network to ensure its availability to system users. These workers gather data to
identify customer needs and then use the information to identify, interpret, and evaluate system
and network requirements. Administrators also may plan, coordinate, and implement network
security measures.
Systems administrators are the information technology employees responsible for the efficient
use of networks by organizations. They ensure that the design of an organization’s computer site
allows all of the components, including computers, the network, and software, to fit together and
work properly. Furthermore, they monitor and adjust the performance of existing networks and
continually survey the current computer site to determine future network needs. Administrators
also troubleshoot problems reported by users and by automated network monitoring systems and
make recommendations for enhancements in the implementation of future servers and networks.
In some organizations, computer security specialists may plan, coordinate, and implement the
organization’s information security. These workers may be called upon to educate users about
computer security, install security software, monitor the network for security breaches, respond
to cyber attacks, and, in some cases, gather data and evidence to be used in prosecuting cyber
crime. The responsibilities of computer security specialists has increased in recent years as there
has been a large increase in the number of cyber attacks on data and networks. This and other
growing specialty occupations reflect an increasing emphasis on client-server applications, the
expansion of Internet and intranet applications, and the demand for more end-user support.

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PLC METHODOLOGY:
Albert David sought to incorporate Programmable Logic Control methodology for its batch
control systems in April, 2006. Its 'modular batch automation' methodology breaks down each
manufacturing module into a pyramid of smaller and smaller process steps, known (in
descending order) as 'procedures', 'unit procedures', 'operations' and 'phases'.
The basic process of pharmaceutical manufacturing commences with the transfer of raw products
into dispensing silos, from which they are conveyed into a weigh bin. The combined powders
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plus any solutions that might be added are mixed together, and then dried using heated air flow.
All weight is reconciled, followed by milling and final blending of the batch; then the resulting
product is ready to be pressed into tablets.
The need for introducing PLC methodology was felt to increase the automation in the whole
system. The company is in a high growth industry and has to expand its operations every 30
months or so. Hence to increase the efficiency of the overall system PLC was introduced.

MACHINES IN OPERATION:

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Semi Automatic Filling Machines

Exhibit: 2 (a)
This is suitable for filling the capsules of various sizes. This machine is equipped with electric
and air control device and automatic counting device, and they make the whole process of filling
automatically from placing the empty capsule.

Automatic Blister Pack Machine

This packaging machine is capable of packing various forms and irregular shapes of tablets.

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Pellets making Machine

Exhibit: 2 (b)
Process details:
1) Makes pellet using dissolved glycol medicine (liquid or super fine
powder etc.)
2) Processing involves: heating, stirring and mixing into a suspension in the ground material

Aluminium Foil Strip Packaging Machines

Exhibit: 2 (c)
The machine is suitable for automatic double aluminum foil hot sealing of tablets and pills. It
also helps in anti-shine sealing. This machine is very well coordinated through PLC.

Multi column Distillation Unit:

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Exhibit: 2 (d)
Albert David Ltd. produces distilled water from multi column distillation units which is imported
from Stilmas Italy.
In a Multi column Distillation unit four processes are used to produce distilled water:
1. Filtration
2. Disinfection
3. Reverse osmosis or de-ionization
4. Distillation or ultra-filtration

Milling and grinding machine:

Exhibit: 2 (e)
The Milling and grinding machine is used to crush raw material into small granule or powder.
Further the larger and irregular granules are processed into smaller and even size (milling).
Coating machine:

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Exhibit: 2 (f)
A coating machine is used for the following purposes:
• Film Coating: One thin protection layer which is coated on the surface of tablet (used in
aqueous or organic solvent)
Film Coating Process
Preheating-->Film coating-->Drying-->Cooling-->Finish
• Enteric Coating: One protection layer is coated on the tablet to against stomach acid.
• Sugar Coating :Many layers of sugar are coated on the surface to protect the tablet.

Form Fill Seal Machine:

Exhibit: 2 (g)
This machine integrates rinsing, filling and revolving cap into one unity, which is mainly used
for filling mineral water, purified water separately into plastic bottles and polyester. In addition,
this machine can complete the functions of delivering bottles, turning-washing bottles, filling,
handling caps and revolving caps automatically.

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THE PRODUCTION PROCESS:
The competitive priorities of the unit are its timely delivery and stringent quality measures. The
process is primarily a capital intensive system with very negligible customer contacts. As
mentioned earlier expansion plan is carried over very frequently, this is aimed at making the
process more automated than manual. The capacity measurement in case of manufacture of
Intravenous bottles is output per machine cycle. The average production for Albert David is
80,000 bottles per day. The effective capacity is 85% of theoretical capacity. They have to
maintain this much of cushion as the demand may vary on a seasonal basis as it has been seen
that during the summers the demand for glucose generally increases. However generally the
production strategy of Albert David is made-to-stock, and thereby it is a continuous process
contrary to that of tablets which is a batch process. They have around 300 working days a year.
In case of raw materials, they are both imported and indigenous. They maintain a healthy lead
time in case of raw materials. For indigenous raw materials a lead time of 30 days is maintained.
In case of imported raw materials a lead time of 2 months is maintained.

The Tablet Manufacturing Process:

The active ingredients and the excipients are procured as raw materials from the market. The
manufacture of oral solid dosage forms such as tablets is a complex multi-stage process under
which the starting materials change their physical characteristics a number of times before the
final dosage form is produced. Numerous unit processes are involved in making tablets,
including particle size reduction and sizing, blending, granulation, drying, compaction, and
(frequently) coating. Various factors associated with these processes can seriously affect content
uniformity, bioavailability, or stability.

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Exhibit 3: Tablet Manufacturing Process

The process can be described as follows:
Dispensing: Dispensing is the first step in any pharmaceutical manufacturing process. It means
weighing and measuring of the ingredients. Dispensing may be done by purely manual by hand
scooping from primary containers and weighing each ingredient by hand on a weigh scale,
manual weighing with material lifting assistance. Issues like weighing accuracy, dust control
(laminar air flow booths, glove boxes), during manual handling, lot control of each ingredient,
material movement into and out of dispensary should be considered during dispensing.
Sizing: The sizing (size reduction, milling, crushing, grinding, pulverization) is an impotent step
(unit operation) involved in the tablet manufacturing. ( Using plant in exhibit 2(e).)
Powder blending: The successful mixing of powder is acknowledged to be more difficult unit
operation because, unlike the situation with liquid, perfect homogeneity is practically
unattainable. Here it is done through machines called “Mixer granulator” or “High shear mixing
machine.
Granulation: Following particle size reduction and blending, the formulation are granulated,
which provides homogeneity of drug distribution in blend.
Drying: Drying is a most important step in the formulation and development of pharmaceutical
product. It is important to keep the residual moisture low enough to prevent product deterioration
and ensure free flowing properties.
Tablet compression: After the preparation of granules (in case of wet granulation) or sized slugs
(in case of dry granulation) or mixing of ingredients (in case of direct compression), they are
compressed to get final product. The compression is done either by single punch machine

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(stamping press) or by multi station machine (rotary press).The tablet press is a high-speed
mechanical device. It 'squeezes' the ingredients into the required tablet shape with extreme
precision. It can make the tablet in many shapes, although they are usually round or oval. Also, it
can press the name of the manufacturer or the product into the top of the tablet.
Coating: The penultimate step is that of coating and coloring of the tablets as per specific
requirements.
Packaging: Pharmaceutical manufacturers have to pack their medicines before they can be sent
out for distribution. The type of packaging will depend on the formulation of the medicine.
'Blister packs' are a common form of packaging used for a wide variety of products. They are
safe and easy to use and they allow the consumer to see the contents without opening the pack.

The Intravenous solution manufacturing process:

Raw feed water is supplied to De-ionization chamber. De-ionization of the feed water occurs
prior to distillation. It is necessary because presence of ionized particulate can disturb the process
of distillation. Distillation is carried out in distillation chamber.
Distilling water is necessary because it makes water relatively free of dissolved mineral content
which prevents superheating of the water and the resulting entrainment of solute particles in the
downstream water stock. The downstream implication of minimizing particulants in the mixing
tank and filter are essential to achieving a superior-quality product. In mixing tank fitted with
filter mixing of desired constituents like sodium chloride and potassium chloride takes place,
from here final solution moves to filling plant.
In filling plant air quality of the filling zone is critical for aseptic filling processes. The machines
here fill and seal the plastic container in one operation. Bottles procured from outside must be
examined for bacterial and particulate contaminants. The Blow-Fill-Seal machine, injects water
or other solutions into the sterile bottles before scaling, greatly reduces both the chance of
contamination and the need for secondary inspection and testing. The Blow-Fill-Seal machine
includes a custom-engineered PLC control system with customized screens. Plastic temperature
control is integral to the control system including PID tuning. Enhanced documentation
accumulation is also built into the system operator's interface. Software accumulates data in real
time from various modules. Differential pressure monitors, and filters integrity testers Data is

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communicated back to the PLC control system and electronically fed for the critical control
factors which relate to the batch processing parameter monitoring. The program continuously
monitors machine parameters and operating interventions. The system is capable of performing
statistical process control on the sampled data as well as recipe batch control, historical trend
diagram, alarm management and multi-level security. Labeling of the completed product is
performed after sterilization by packaging equipment on the production line.

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