“Develop success from failures. Discouragement and failure are two of the surest stepping stones to success.”
Printing Organization and Plant Layout
MANAGEMENT
Definition: management is the effective utilization of all resources through the process of planning, organizing, directing, and controlling in order to obtain stated objective.
Implement the policies made by administration is management.
The procedure of implementing the policies which is suggested by administration.
Administration: administration is top level function which includes determination of objectives and policies and overall controlled of business operations.
To from, to make the policies of the company.
Administration is concerned with laying down objectives of the enterprises, formulating its policies, determining the broad organization structure and overall control of the undertaking. Administration is a top level function which includes determination of objectives and policies and overall control of business operation.
Scientific management: the science which we apply in management is called scientific management. Input material, data, right man at right job.
The early decades of this century witnessed the emergency of scientific management. This school of through attempted to introduce a rational, systematic approach to work and to the management of work.
In his early writings F.W taylor referred to is idea of task management. In 1910 lowis brandeis coined the word scientific management.
F.W taylor got recognition as the father of scientific management. He wrote a book on the principles of management in the year 1911.
The primary emphasis of scientific management was on planning, standardizing, improve human effort and the operative level in order to maximum output and minimum input.
Taylor believed that management based on objective assessment of facts, on measurement and not on guest work.
Scientific management is applying scientific knowledge scientific method to the various aspect of management and the problems that arise from them.
Taylor through that by maximum the productive efficiency of each worker scientific management would also maximize the earning of the employees and employers.
Scientific management removed the workman discretion in planning, organizing and controlling of his own task performance.
Rather scientific man required that, management should plan, organize and control task performance.
Management should standardize methods.
1. The right person should be available at right position.
2. Training and update research of staff (proper training and development of the staff).
3. To calculate the worker’s performance should be evaluated time to time, & find out why this person not fit in your organization and how can we improve it.
4. What the wrong things are going in organization and how we can justify it.
5. We have to put responsibilities on each and every people give them a target in time.
6. Targets should not be given randomly.
7. The workers are recruited at parameters or not.
Function of element of management:
1. Planning: planning is one of the most important function in the management, without planning we can’t even take a step own-self.
Everyone do own plan, when, what, why, where to do what to do, where to do-why to do in future.
Market survey:
Short run job long run job
In view of printing industries----various material likes ink, substrate, machine, from where, these are to but, like these, various thing is done.
All datas are collected from different-different market for the particular things.
It is the first basic function of management. It determines the objectives to be achieved and the course of action to be followed to achieve them. It involves deciding in advance what to do, when to do it, where to do it, who is to do it and result are be evaluated.
Certain inputs are required are be to make a plan.
Who will be our client?
Supply?
Demand?
First step of planning?
Market survey?
a. Fore-casting: forecasting is a necessary preliminary to planning.
Forecasting estimates the future work or what should be done in future. On the basis of market survey available, we fore-caste it. Ex-location.
On the basis of market survey available, we forecast it ex-location.
2. Organizing: organization involves identification and grouping the activities to be performed and diving them among the individuals and creating authority and responsibility relationship among them for the accomplishment of organizational objectives.
We have “to organize” for starting any organization, we organize various things, money, man-power, machine sequence & raw materials.
If we have to organize money, we can organize it from ourselves, banks & we can borrow money.
Organizing various things to run an organization is the second step in the management through which we can proceed further in other business activities.
a. Identification of activities required for the achievement objectives and implementation of plan.
b. Assignment of jobs to employees.
3. Directing: directing involves communicating and providing leadership to the subordinates and motivation them for the achievement of organizational objectives.
How the things can be reached. Both the parties and agreed i.e., they understand each other.
You will be performing your duty unless you are directed in a right way in which a manager influences the actions of sub-ordinates.
We must aware to do your work in a systematic manner.
Whatever you are given instruction he must catch your instructions.
Directions are only successful only, when If other person is ready it hear it, must be followed.
a. Supervision: it means overseeing the functioning of the sub-ordinates.
b. Communication: it is the process of sharing informations and understanding with other.
c. Leadership
d. Motivation.
4. Motivation: it means inspiring the sub-ordinates with real to work for the accomplishment of organizational objectives successful manager to make use of different motivations techniques to another the workers. Financial incentives are a good tool of motivation. Non-financial incentives such a precise, recognitions freedom to week etc.
It is a tool of management, we can increase capability of workers, output but we require to motivate the work force to do our work.
a. We can give them incentives.
b. We can sharing our bones with them.
c. We can give them promotion
They give target & they will get some amount of commission.
5. Co-ordination: Without co-ordination, we can’t move a single step.
Inter-department co-ordination: all printing department should have a smooth co-ordination among themselves.
Co-ordination is necessary among managers & workers, machine & labour etc.
6. Controlling: controlling means checking the performance of sub-ordinates. A superior must see how far his sub-ordinates have performed their duties. It the performance is unsatisfactory, reason have to found out for remedial measures. It is an integral part of the process of management.
How to maintain a discipling. All the work should be in a controlled manner, their can be disturbances in the production.
It is very important for maintain the quality it is a monitoring process.
Organization: Structure of organization: once plans are formulates the next step is that of organization is the process of establishing harmous authority & responsibility relationship among the member of the enterprises.
It is the function of creating & structure of duties and responsibility relationship is known is organization structure.
According to fayol “to organize a business is to provide it with everything useful to its functioning raw material, tools, capital and personnel.
These are three main parts of organization are:
1. Sales and marketing: total production depends upon sales department. It is the main part of any production department.
To get the production work from market so that production work takes place. It deals with all kinds of work which relates to the starting of any production and benefits the owner.
There is a higher risk factor in sales & marketing, it is a mind-full department.
Responsibilities of sales and marketing: it is responsible for all orders, sales, communicating to consumers. To tell the consumers, to educate the consumers, to compel the consumer.
2. Production: it is the heart of any organization.
It must run as per the requirement of client, quality, getting and instant.
It is also the change or covert the raw material into finished product.
Responsibilities of production: as the name indicates, “To product” depending upon the demand demanding upon sales and marketing department. It is actually executing of the job.
Every product have to be delivered at certain period or interval. We can’t compromise with the time.
Quality must be maintained. There should be any compromise with the quality.
To give maximum output with minimum input.
3. Administration: to make policies of the organization.
Sales and administration, production both reports to administration.
It has got the control, charge of human resources (H.R) & finance department.
Administrative approvals are required to run the organization.
By combining sales & marketing, production & administration, the organization is made.
Responsibilities of administration: it gives the target, give instruction to the sales and marketing what must be the target such that the organization is benefitted, is must maintain a target which is limited so that they could be able to achieve it.
Target should be according to target infrastructure available etc.
Finance department is directly under the control of administration.
It is the duty of administration that the workers are getting a good & healthy environment to work.
HR department looks after the workers comfort their salaries, their working environment etc.
Departmental management: Management is characterized by the presence of a chain of command, the chain of supervisors and sub-ordinate from the highest level of organization of the lowest. It is level of management.
They transmit orders, suggestions and decisions downwards and carry the problems and suggesting upwards.
Leadership: It is the ability to shape the attitude and behaviors of others whether in formal or informal way”.
It is a process of influencing the people and leadership transforms potential into reality.
Important of leadership:
1. It helps in persuading employees to work with determination towards common goals.
2. Leaders develop and maintain an environment which leads to maximum work efforts.
3. He fills confidence in his sub-ordinates.
4. He identifies the group goals and helps the group to obtain them.
5. He administrates the company by arranging, planning, organizing, directing, co-ordinating, and controlling the company is activities.
6. He takes a decision and finds out alternative methods of actions.
7. He initiates all the measures that are necessary for the health and progress of the company.
Qualities of a good leaders:
1. Intelligence: it should be intelligent enough to examine problems in the rigid perspective.
2. Communicative skills: he must be able to communicate clearly, precisely and effectively.
3. Objectively: he should be objective in his outlook.
4. Knowledge of work: he should have full knowledge of the tasks handled by him.
5. Self-confidence and will power: he must have confidence on his ability to meet the expectations of sub-ordinates as well as demands of day to day situations.
6. Human relation: he must be able to get along with people in a smooth and friendly manner.
7. Empathy: he should have the ability to look at things from others point of view.
8. A sense of mission.
9. Education.
10. Acceptability
11. Vision
12. Verbal ability and communication
13. Approachability
14. Maturity
15. Dependability
16. Administration
17. Cheerfulness and socialness
18. Group spirit.
19. Flexibility
20. Energy
21. Constructive, creative and independent thinking.
Productivity: Productivity management is considered to be one of the important and difficult tasks of management. It is also one of the more frequently discussed topics is seminars and management circles.
Significance of productivity: whether it is a free enterprise economy, a socialistic economy or a mixed economy the stress is being given on higher productivity, according to price Philip “no amount of economic juggling to can alter the fact that in the long run, our solvency depends on the efficiency of our industries and upon the national productivity.
When the productivity in an industry is increased, the rate of economic growth increased automatically.
Increase in productivity in an industry leads to higher production with the most economical use of available resources. In other words, the cost of production by decreased.
This benefits the customer by reducing the prices, the workers by increasing their wages and the entrepreneurs by increasing profits.
The productivity drive has higher significance in case of developing countries which are facing the problems of inadequacy of capital, raw materials, management personnel etc.
Advantage of higher productivity:
1. Increase in the efficiency of various factors of production.
2. Economical use of various factors of production. This decreases the total cost of production per unit.
3. Decrease in overhead cost.
4. Better quality of goods at lower price.
5. Overall growth of the economy.
6. Profit are increased.
7. Increase in wages and salaries to the workers.
Meaning of productivity: it represents goods and services produced in relation to the resources utilized in their production.
Measures of productivity:
Production V/S Productivity:
There is a different between the two terms, namely production and productivity.
Production: if inputs are increased and a large production is obtained, it does not necessarily result in increased productivity.
Productivity: but if production is increased with the use of same inputs or the same output or production is obtained with smaller inputs, productivity is sold to have increased.
Factors influencing industrial productivity:
1. Technological advancement.
2. Quality of workforce.
3. Available of finance.
4. Managerial talent.
5. Government policy.
6. Natural factors.
Difficulties in managing labour productivity: the difficulties in managing productivity of labour are due to the following factors:
1. Lack of commitment of management to productivity enforcement.
2. Lack of system to measure productivity.
3. Poor industrial relations climate.
4. Bad method and bad management contributing to low productivity.
Some other lack productivity:
1. High overtime.
2. High idle time.
3. High absenteeism.
4. Low output.
5. More rejections.
6. Rework and rectification.
7. More waiting times.
8. Inadequate utilization of machinery.
9. Surplus manpower.
10. Frequent work stoppage.
Step of increase productivity:
1. Improved raw materials.
2. Better machines.
3. Good working conditions.
4. Scientific selection of workers.
5. Industrial research.
6. Provisions of incentives.
7. Quality and cost consciousness.
Scientific management: F.W taylor was the first person who instead on the introduction of scientific method in management.
Meaning of scientific management: scientific management is the substitution of exact scientific investigations and knowledge for the old individual judgement or opinion in all matters relating to the work done in the shop.
The thread of scientific management turns through operational study of work, the analysis of work into simplest elements and the systematic improvement of workers performance of each elements.
1. Scientific study and analysis of work.
2. Scientific selection and training of employees.
3. Standardization of raw materials, working conditions and equipment.
Aim of scientific management:
1. Increased production.
2. Quality control.
3. Cost reduction.
4. Elimination of wastes.
5. Right man for right work.
6. Incentive wages.
Techniques or element of scientific management:
1. Scientific task setting:
2. Work study (work study implies an organized objectives, systematic, analytical and critical assessment term for those techniques which are used in examination of human work in all its content and which leads systematically to the investigation of all factors that affect the efficiency and economy of operation.
a. Method study: it conducted to know the best method of doing a particular job.
b. Motion study: it is a study of the movement of an operator or a machine.
c. Time study or work measurement: time study is an art of observing and recording the time required to do each detailed element of an industrial operation.
d. Fatigue study: fatigue, physical or mental, has an adverse effect on worker’s healths and his efficiency.
3. Planning the task:
4. Rate setting: wages rates should be fixed in such a way that the average worker is induced to attain the standard.
5. Standardization: the standardization of material, tools and equipment, cost system and several items. Efforts should also be made to provide standardized working conditions and methods of production to the workers.
6. Scientific selection and training of workers: it is very important and it required right worker on the right jobs.
7. Specialization: he advocated functional foremanship for this purpose. In his scheme planning was separated from executing. He recommended eight foreman in all to control the various aspect of production. He advocated four foreman in the planning department namely, route clerk instruction card clerk, time and cost clerk and shop disciplinarian.
The four foreman recommended for getting the required performance from the workers include gang boss, speed boss, repair boss and inspector.
Principles of scientific management:
1. To point out, through simple examples, the great loss and country is suffering through inefficiency in almost all of its daily operations.
2. To try to convience to readers that the cure lies in systematic management rather than searching for unusal man.
3. To prove that the best management is a true science based on clearly defined, laws, rules and principles and to show that the principles of scientific management are applicable to all forms of human activities.
It based of five principles:
1. Replacement of old rule of thumb method: it should be used for taking managerial decision instead of basing decision on openion, institution or rule of thumb.
2. Scientific selection and training of workers.
3. Co-operation between labour and management.
4. Maximum output.
5. Equal division of responsibility.
Mental revolution: the basic idea behind the principles of scientific management is to change the mental attitude of the workers and the management toward each other taylor called it “mental revolution”.
a. All out efforts for increasing production.
b. Creating of the spirit of mutual trust and confidence.
c. In-calculating and developing the scientific attitude towards problems.
Benefits of scientific management:
To employers: the main benefit of scientific management is “conservation and saving, making an adequate use of every ounce of energy of any type that is expended.
a. Replacement of traditional rule of thumb method by scientific investigation.
b. Proper selection and training of the workers leading to better workforce.
c. Achievement of equal division of responsibilities between the workers and the management.
d. Standardization of tools, equipment, materials and work method s for increasing efficiency.
e. Better utilization of various resources.
f. Better relation between workers and management.
g. Scientific determination of fair day’s work.
h. Worker can do.
To workers:
a. Detailed instructions and constant guidance for the workers.
b. Opportunity for training and development to increasing skills.
c. Incentive wages to the workers for higher production.
d. Better working conditions and tools for work for good health of the workers.
e. Less fatigue in work because of application of scientific method.
To society:
a. Better quality product as lower costs to the people.
b. Higher standard of living of people though better products.
c. Increased productivity in the country.
d. Industrial peace in the country.
e. Technological development due to scientific investigation.
LOCATION OF THE ENTERPRISE
Approachable, walking distance, more facilities to customer easily availability of labours transportation proper connectivity, availability of electricity, proper communication system, good roads and machine & machine parts, mechanics availability.
Plant layout: plant layout means the disposition of the various facilities (equipment, material, man-power etc.) and services of the plant within the area of the site selected previously.
Plant layout begins with the design of the factory building and goes up to the location and movement of a work table.
All the facilities like equipment, raw material, machinery, tools, fixtures, workers etc. are given a proper place.
1. Integration: integration of production centers in a logical and balanced manner.
2. Minimum movements and material handling.
3. Working conditions are sager, better.
4. Increased productivity and better product quality.
5. Plant maintenance is simplier.
6. Movements made by the workers are minimized.
7. Utilization of cubic space (length, width, height).
SALESMANSHIP AND ADVERTISING
Marketing helps in developing economic resources, since a business firm generates revenue and earns. Profit by carrying out marketing function, it will engage in exploiting more and more economic resources of the country to earn more profits. Therefore, marketing should be given the greatest important if the national resources are to be exploited fully. Marketing determines the needs of the customers and sets out of the pattern of production of goods and services necessary to satisfy the needs of the customers. Marketing also helps to explore the export market.
Definition of marketing:
1. Narrow definition: marketing may be an economic process by which goods and services are exchanged and the values determined in terms of monthly prices. The American marketing association has defined marketing as “the performance of business activities that direct the flow of goods and services through producer to consumers or users. That means marketing includes all those activities carried on to transfer the goods from the manufacturers or producers to the consumers. In involves the exchanges of goods and services for money.
But in the present day, business marketing begins long before the goods are produced. The demands of the customers must be forecast before the product development and production take place. Marketing decisions must also be made regarding the market, pricing and promotion of the product, marketing does not end with the final sale. It is main aim of customer satisfaction.
2. broad definition: marketing is the business process by which products are matched with the markets and though which transfer of ownership are effected if a business organization produces the products after assessing the requirements of prospective customers, it is more likely to be successful to achieve its objectives. The consumer-oriented marketing has given rise to a new phillosphy in business known as ‘marketing concept’. The marketing concept emphasis the determination of the requirement of potential customers and supplying products to satisfying their requirements.
“marketing is a total system of interacting business activities designed to plan, price, promote and distribute wants satisfying products and services to present and potential customers.
Marketing concepts: Modern authors view marketing more than a physical process of distribution goods and services. They feel that marketing represents a distinct phillosphy of business or a course of business thinking that has emerged over the recent years. The businessman following this philosphy recognise and accept ‘customer oriented’ way of doing the business. It needs of customers.
Under marketing concept the emphasis is a selling satisfaction and not merely on selling a product.
Marketing concept is based on three fundamental beliefs. First all company planning policies and operations should be oriented towards the customers.
Secondly, profitable sales volume should be the goal of a firm.
Third all marketing activities in a firm should be organizationally integrated and co-ordinated.
Distinction between marketing and selling: The marketing concept is a course of business thinking while marketing is a process or a course of business action. Naturally, marketing is influenced by the course of business thinking (i.e. customer-oriented). Marketing concept focuses on customers for earning profits through customers ‘satisfaction and follows integrated marketing but formely marketing focused on products to earn profit through sales volume and followed sales promotion techniques for this purpose.
Marketing is a total system of interacting business activities designed to plan, promote and distribute want satisfying goods and services to present and potential customers.
Selling is a sub-activity of marketing and is basically administrative in nature conditioned to physical transfer of ownership and possession of goods and services from the seller to the buyer. Selling concentration merely on increasing the volume of sales whereas marketing is concerned with satisfaction of wants, needs and preferences of the customer.
Marketing management: Marketing management is an important operative function of management. It performs all management functions in the field of marketing. It is responsible for planning, organising, directing and controlling the marketing activities.
Marketing management is the analysis planning implementation and control of programmes designed to create, build, maintained mutually beneficial exchanges and relationships with target market for the purpose of achieving organization objectives.
Function of marketing: In most of the business enterprises, marketing department is set up under supervision of the marketing manager. The major purpose of this department is to generate revenue for the business by selling want satisfaction goods and services to the customers. In order to achieve this purpose. The marketing manager perform the following functions.
1. Marketing research.
2. Product planning and development.
3. Buying and assembling.
4. Selling.
5. Standardisation, garding and branding.
6. Packaging.
7. Storage.
8. Transportation.
9. Sale-man ship.
10. Advertising.
11. Pricing.
12. Insurance.
Marketing functions:
1. Function of research
(a) Marketing research.
(b) Product planning & development.
2. Function of exchange
(a) Buying and assembling
(b) Selling
3. Functions of physical treatment
(a) Standardization grading & branding.
(b) Packaging.
(c) Storage.
(d) Transportation.
4. Function which facilitate exchange
(a) Salesman ship.
(b) Advertising.
(c) Pricing.
(d) Insurance.
Business Process Management:
Business process management (BPM) has been referred to as a
"holistic management" approach to aligning an organization's business processes with the
wants and needs of clients. BPM uses a systematic approach in an attempt to continuously
improve business effectiveness and efficiency while striving for innovation, flexibility, and
integration with technology. It can therefore be described as a "process
optimization process.
Printing Industries: Printing means to produce reproductions of written material or images in multiple copies. There are four traditional types of printing: relief printing (with which this article is mainly concerned), intaglio, lithography, and screen process printing. Relief printing encompasses type, stereotype, electrotype, and letterpress. Flexographic printing is a form of rotary letterpress printing using flexible rubber plates and rapid-drying inks.
Printing and Print – Packaging industry in India is growing; people are taking keen interest in this key industry now. There are more than 36 printing institutes some of these giving even post-graduate education. Every year more than 3500 new printing engineering graduates joins the industry, while still much more get on the spot training in the print shops. Printing especially Packaging printing is now one of the industry. It is said that since 1989 the growth of the Printing coupled with Packaging Printing industry is over 14%.
The growth of this sector attributes to the two main reasons, First is the spread of education- according to the 2001 census report literacy growth in India touched nearly 66 per cent. This amazing growth in literacy together with rising educational levels and rapidly progressing trade and industry in India make the current situation a happy note. Literacy rate is growing; increase in the literacy rate has direct positive effect on the rise of the circulation of the regional papers. The people are first educated in their mother tongue as per their state in which they live e.g. students in Maharashtra are compulsory taught Marathi language and hence they are educated in their state language and the first thing a literate person does is read papers and gain knowledge and hence higher the literacy rate in a state the sales of the dominating regional paper in the state rises. There's little doubt about India's market potential in print media. According to a national survey, 248 million literate adults still don't read any publication. But readership of newspapers and magazines is up by 15% since 1998 to 180 million. It's a reflection of a younger, more educated population, especially in small-town India, feel experts. India has 49,000 publications, but annual revenues total just $1.1 billion. While they can be vibrant and gutsy, most are starved for technology, marketing, and capital to expand. So a handful of publications dominate. With the growth in literacy, the Indian print media industry is expected to grow at CAGR of 5.7% for the period 2009-13 to reach Rs. 213.6 billion from Rs. 161.8 billion in 2008.
Production and operations management: Production and operations management is a critical management role in the regulated transformation of raw materials into goods and services with an added value per the organisation’s policies. Although production and operations management concepts and techniques have been developed throughout time owing to global competitiveness, these concepts and methods are supplemented by newer/modified concepts and designs to fit the evolving needs of business houses.
As businesses operate in an environment where they have to offer goods, services or ideas to potential customers to earn revenue for their shareholders and also in order to expand, diversify, grow and create goodwill for themselves, they have to undertake operations with the resources that they have. The primary function of any business is the objective for which the industry has been set up. For example, for a company who sells cold drinks, operations will include all the necessary steps that are important to produce and store and finally sell the cold drinks bottles to the end customer in such a way that it ensures utmost efficiency.
Production and Operations Management involved two distinct ideas: “Production” and “Operations”. Operations management, in particular, became a popular field in academics only after the services became a matter of mass production in the new industrial revolution. When the show became intangible along with the conventional tangible, to fill this gap and to broaden the understanding of the field of production management in the services sector, the advent of operation management began.
Location of Facilities:
Location decision is one of the most important decisions of production and operations management. The decision about where the plant facility will be established concerns the location decision. For example, the idea of setting up a manufacturing plant in an industrial town of Haryana will majorly be based on several factors, including the availability of raw material, labour, ancillary activities, the customer’s geographic location etc., in no particular order.
The decision concerning the location of the facilities is typically a key decision because it has a long-term impact on the firm. Once set up, it takes much work for the firms to step back from the decision.
Plant Layout & Material Handling
The layout is the structure in which the physical components of any production facility are arranged. A production facility typically has various centres of production where each centre has a different role to play in the production process. Think of a car manufacturing plant at Manesar, Haryana. They do not just let the steel sheets, Tires, Paint cans, electrical wiring, Glass, Fibre panels, screws and bolts into the building from one side and get the final finished car out from the other. Rather there are dedicated facilities for every operation.
For metal fabrication, there is a separate setup, another set-up for the engine, another for paint etc. Similarly, each set-up requires different kinds of inputs and materials also. Sometimes the material has to be taken from one place to another. All these decisions regarding the handling of material and setting up of the physical arrangement of the plant have to be taken keeping in mind the required quality that is to be achieved with minimum wastage and costs. Thus, Plant layout and material handling are crucial decisions under production and operations management.
Quality Control
A method used to maintain a standard of quality for goods and services can be termed quality control. It involves systematically overviewing several elements that have an impact on the product's quality. Quality control also uses an efficient feedback system and corrective action mechanism to avoid faults at their source.
Inventory Management
One of the critical responsibilities of a production and operations manager is to ensure that the organization maintains adequate inventory levels to meet customer demands. Inventory management decisions include determining the optimal quantity to order, when to place an order, and how much safety stock to maintain. A manager must strike a balance between maintaining adequate inventory levels to meet demand and minimizing the costs associated with holding inventory.
Faculty Location: Facility location plays an important role in operations management. Every business has some kind of facilities, operating space, and storage space for machinery, bulk stock, types of equipment, etc., to perform their day-to-day operations smoothly. So, they require adequate space to run the business operations without compromising on time, and money and use their resources to their full potential.
Facility location is a strategic decision for the business to decide and assess whether a particular location will reduce the operating economy and increase operating efficiency by computing and controlling operational cost and labor availability, and ensuring easy arrival of raw material and distribution of the final product. While there are several mathematically derived methods to determine the optimum facility location,the business owner should also assess the qualitative aspects, i.e., that are not measurable in numbers, to ensure the best possible site location forthe optimum day-to-day operations of the business. For example, a location that is far from a major city may face higher transportation costs, unavailability of unskilled and skilled labor, and delayed supply of raw materials.Therefore, after a critical analysis of both quantitative and qualitative factors, the best possible facility location is selected. The various factors affecting the choice of location have been discussed in the following section.
Facility location is also an important concept for supply chain management (Melo, Nickel, &
Saldanha-da-Gama, 2009). The efficiency of the distribution system and the logistic system, and the ability to fulfill the order requirements on time are the key components of the supply chain which are heavily dependent on where the facility is located. Therefore, the facility should be located in the proximity of other suppliers as well as retailers. The emergence of technology in terms of artificial intelligence (AI) and the internet of things (IoT), as well as the growing awareness of various stakeholders about environment-friendly practices, have also impacted supply chain decisions.Therefore, the facility location and the operations in the facility location should adopt technological changes for efficient operations as well as ensure environmental sustainability. This has also led to the concept of green supply chain management. The linkage between facility location and supply chain network design is crucial (Petrisor&Cozmiuc, 2017).
Faculties Location:
The basic production, distribution, and feedback (PDF) model is explained in Figure 1.1. The key elements of any such production and distribution network include raw material supplier, factory or production unit, warehouse or storage unit, wholesaler, retail store, and customers. There is also a reverse process resulting in providing information, requirement, and feedback.
The raw material supplier will ensure the availability and transportation of raw materials to the factory or production unit for further processing. The factory or production unit will process that raw material into the finished goods and will send it to the warehouse or storage unit. The warehouse or storage unit will preserve the finished goods and ensure their safety. Upon the order requirement received from the wholesaler, the warehouse manager will prepare the consignment ready to be delivered to the wholesalers’ location. Now it is the job of the marketing manager as well as the wholesaler to provide the finished goods to a preferred chain of retail stores. These retail stores are selected strategically to ensure maximum coverage of the target customers and be available at locations where the customers are shopping. And lastly, a feedback mechanism works in the background where all the involved elements will provide information, requirement, and appropriate feedback.
Fig 2.1: Flow of production, distribution, and feedback(Source: Author’s compilation)
The facility location decisions will ensure that the above production and distribution model works seamlessly. Therefore,it is very crucial to decide upon the facility location strategically after considering all the elements discussed above. The facility location or the production unit should be accessible to suppliers as well as wholesalers. As the volume of business operations increases, the businesses tend to keep the production unit and the warehouses at the same location in close proximity to wholesalers and retailers.
Big businesses move a step ahead with the help of a strategic decision to adopt either forward integration or backward integration or both. In forward integration, they acquire their suppliers and become their own retailers by opening their own branded stores. For example, exclusive stores of Nike, Reliance, etc. In the case of backward integration, the manufacturer acquires their supplier of raw materials to save cost and time. In both strategies, the business is trying to have more control over the production and distribution network. For example, China is known for its world-class manufacturing unit, wherein they invite small suppliers of raw material by giving them space in the production unit itself and also have their warehouses situated at the same location and the manufacturing unit is the size of a small city. This is one of the reasons why China is famous around the world for its production infrastructure and for producing goods at the cheapest possible cost.
There could be various circumstances under which a business decides to explore a new location for its operations. Some of the common reasons are:
• Opening a new segment of the business
• Expansion of existing manufacturing operations
o To cater to the increased demand
o For increasing presence in a new region or covering a new territory
• To strategically reduce costs of the existing business operations
• Due to the uncontrollable external factors in the socio-cultural, regulatory, or legal environment.
It is recommended that a business should be flexible enough to adapt to any unforeseen external changes and have a provision for shifting to an alternate location, beforehand. Many large businesses share the same facility location to manufacture different segments of goods in order to save costs and reach economies of scale.
Globalization of operations: Due to the globalization and opening of the economy, customers have easy access to global products and global markets. When a business goes global by launching its operations around the world, they face a very diverse set of geo-political challenges.In order to tackle these challenges and the competition in global markets for providing world-class quality, businesses have spread their operations in various cost-effective manufacturing hubs around the world. It is also called the expansion of manufacturing hubs and can be seen as a growth strategy of a business. Not only does the global presence helps in catering to a different set of customers, but it also helps in lowering the overall operating costs by reducing the cost of various factors. The main reasons are:
Reduced labor costs, Reduced raw material costs, Easy access to buyer markets, Tax rebates, Trade agreements and benefits from government.
Factors affecting location decisions: It must be now clear why facility location is so important, as it affects the whole supply chain network. But still, there is no clear-cut shortcut to estimate the best possible location. As discussed earlier, a wise decision-making manager should consider both qualitative and quantitative factors. The qualitative factors will include land acquisition, construction and building, transportation, electricity, and other utility costs. The quantitative factors on the other hand will include the supply and demand of labor, climate conditions, regulations of the state, legal requirements, environment-related laws, and the political and cultural environment. For example, in the year 2008, while manufacturing the Nano car, Tata had to move its existing manufacturing plant location from West Bengal due to political disturbance in the state. This caused delays and an increase in the cost of production for Tata.A list of factors is compiled and given in Table 1.1:
Table 2.1: Factors affectinglocation decisions (source: Author’s compilation)
Operational Factors, Labor Factors, Logistic Factors, Socio-cultural, Regulatory and Climatic conditions.
Location planning methods: As discussed above, there are various qualitative factors affecting the decision about facility location. However, there are some quantitative measures to guestimate the operating cost. Various options for facility location can be assessed based on certain benchmarks and the best performer in those ranking or ratings or scores can be selected.
Maintenance and Repair:
Production and operations managers are responsible for ensuring that equipment and machinery are in good working condition to maintain the production process. This requires a plan for maintenance and repair to minimize downtime and avoid costly repairs. Decisions related to maintenance and repair include choosing the best equipment maintenance strategy, scheduling maintenance and repair work, and identifying the right suppliers to provide the necessary equipment parts and services.
UNIT-2
Site Selection
Site selection refers to the process of choosing the most suitable location for setting up an industrial plant, factory, or facility. The goal is to maximize operational efficiency, reduce costs, and enhance market reach.
Strategic Issues of Location
Strategic issues to consider while selecting a site include:
Supply-Distribution System
Dynamic Nature of Plant Location
Location Strategy – Factors Influencing Choice
State Regulations on Location
Backward Areas and Industrial Policy
Government Policies for Decentralization
Industrial Estates
Comparison of Locations
Location Type
Advantages
Considerations / Disadvantages
Urban
Market access, labor availability, infrastructure
High land cost, congestion, pollution
Sub-urban
Moderate cost, good connectivity, growing markets
May require some infrastructure development
Rural / Backward
Low land cost, government incentives, decentralized growth
Poor labor skills, limited infrastructure
Economic Survey of Site Selection
Analytical Approach
UNIT-3
Characteristics & Applications:
Factors Governing Flow Patterns:
Line Flow (Straight Flow)
Text Sketch:
Start → Machine 1 → Machine 2 → Machine 3 → Finish
L-Type Flow
Start → Machine 1 → Machine 2
↓
Machine 3 → Finish
Circular Flow
↑ ↓
Finish ← Machine 3 ← Machine 4
U-Type Flow
Start → M1 → M2 → M3
M4 ← M5 ← Finish
S or Inverted S Flow
Text Sketch (S Flow):
Start → M1 → M2
↓ ↑
M3 → M4 → Finish
Combination of U and Line Flow
Line Section: Start → M1 → M2
U Section: ↓
UNIT-4
Introduction
A factory building is a structure designed to accommodate industrial operations, machinery, raw materials, and workforce in an organized way. It is more than just a shelter; it plays a vital role in efficient production, safety, and worker productivity.
Key Points:
Advantages of a Good Factory Building
Feature
Single-Storey Building
Multi-Storey Building
Floor Area
Large horizontal area required
Saves horizontal space
Material Handling
Easy, materials move on same level
Requires lifts, hoists, or conveyors
Construction Cost
Usually lower per sq. m.
Higher due to structural requirements
Supervision
Easier to supervise
More complex supervision
Flexibility
Easier to modify layout
Difficult to modify or expand
Suitable For
Heavy machinery, large equipment
Light machinery, small-scale industries, urban areas
Natural Lighting & Ventilation
Easier to provide
Needs careful planning (skylights, ducts)
Analytical approaches use mathematical, statistical, and operational research techniques to optimize plant layout. They aim to:
Methods can include heuristic approaches, mathematical models, and simulation techniques.
Line balancing ensures each workstation in a production line has roughly equal work content to minimize idle time and maximize efficiency.
Heuristic Methods: (Rule-of-thumb approaches, faster but approximate)
Objective:
These problems involve selecting the best location for a single facility to optimize objectives such as minimizing transportation cost or total distance to customers.
Minisum Location Problem with Distance:
Minimize ∑i=1nwi⋅d(F,Pi)\text{Minimize } \sum_{i=1}^{n} w_i \cdot d(F, P_i)Minimize i=1∑nwi⋅d(F,Pi)
Where:
d=(x2−x1)2+(y2−y1)2d = \sqrt{(x_2 - x_1)^2 + (y_2 - y_1)^2}d=(x2−x1)2+(y2−y1)2
Concept
Key Point
Heuristic Line Balancing
LCR, RPW, Kilbridge & Wester, COMSOAL
Single Facility Location
Minisum problem – minimize total distance/cost
Distance Metrics
Euclidean (straight-line), Manhattan (grid)
MLP
Multi-facility, optimization of distances using algorithms