Industrial Engineering - Module Ii Plant Location: Reasons For Location Changes

S7- INDUSTRIAL ENGINEERING, VJCET
INDUSTRIAL ENGINEERING MODULE II PLANT LOCATION

The problem of how many facilities to have and where they should be located is encountered by service and product organization in both the public and private sectors. Banks, restaurants, recreation agencies, and manufacturing companies are all concerned with selecting sites that will best enable them to meet their long-term goals. Since the operation managers fixes many costs with the location decision, both the efficiency and effectiveness of the conversion process are dependent upon location. This chapter will examine the facilities location issues in details by taking into account the reasons for location changes and the factors affecting the selection of location. We shall also discuss the procedure for facility location and related issues in the sections to follow. REASONS FOR LOCATION CHANGES Different situations for location change could be (i) a new plant is just being started, (ii) a new branch of an existing plant is to be located, or (iii) a new location for an existing plant is being sought. In addition to the need for greater capacity, there are other reasons for changing or adding locations: Changes in resources may occur. The cost or availability of labor, raw materials, and supporting resources (such as subcontractors) may change. The geography of demand may shift. As product markets change, it may be desirable to change facility location to provide better service to customers. Some companies may merge, making facilities location redundant. New products may be introduced, changing the availability of resources and markets. Political and economic conditions may change. Location decision should be based on long range policy and forecasts, e.g. companys expansion policy, anticipated diversification of products, changing markets, changing sources of raw materials, etc. Other decisions to be made before a plant selection/construction are: (a) products or services to be made or offered in the plant, (b) type of equipment required, (c) type of structure needed, and (d) location of the plant. GENERAL FACTORS INFLUENCING LOCATION The factors to be taken into account depend on the type of industry to be located. Thus the factors important for locating a steel plant may be different from the factors to be considered in locating a computer assembly plant. However, the general factors affecting the location of plant or facility are as mentioned below. Proximity to Good Highways This consists of the quality of highway system, its relationship to markets, raw materials, and labor supply. It is obvious that availability of inter state super highways makes the suburbs, small communities, and country easily accessible. Abundant Labor Supply It is always preferable to locate the plant in an area where skilled, semi-skilled, an unskilled labor are available. This explains why the glass and bangles industries are located in Firozabad (India) where skilled manpower in this field are available. The same reasons are true for carpets
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industry in Mirzapur, and silk sarees in Kanziwaram. It is also desirable to have no labor problem. Location of facility will also depend on the prevalent wage rate, facilities for labor, history of relationship between trade-union and management in the area under consideration. Rural labors can be hired at lower wages and Steel industry needs a lot of rural labor. Perhaps this is why most of the steel plants in India are located in rural areas. Proximity to Markets Plant should be located nearer to the consumers market. Plants r elated to cement, bricks, roofing, and gypsum board are located nearer to the market. However, for those companies producing items like fountain pens, jewelry, and watches in which the costs of materials and labor are high, shipping costs are of secondary importance, and the location of plant is not on the basis of proximity of markets. For many firms it is extremely important to locate the plant near customers. Specially, service organizations, like drugstores, restaurants, post offices, or barbers, find proximity to market as the primary location factor. Manufacturing firms find it useful to be close to customers when transporting finished goods is expensive or difficult (perhaps because they are bulky, heavy, or fragile). Further, with the trend toward JIT production, suppliers want to locate near users to speed up deliveries. Availability of Suitable Land and Land Cost Cost of land is usually a minor factor in the location of a plant. In the communities that are interested in attracting new plants, land may be offered at a reduced price or at no cost, which may influence some plants to locate there. Adequate Water Supply Water is necessary for almost all kinds of plants. However, some plants heavily depend on water supply. For example, thermal power plant, Hydroelectric power plant, steel plant need lots of water for its day to day operation. This needs the plant to be located nearer to the water sources like lake or river. Nearness to Raw Materials and Suppliers In general, bulky or perishable products manufacturing companies are located near to the source of the raw materials. For example, food processing industry should be located nearer to canning factories, meat packing plants and creameries. Firms locate near their suppliers because of the perishability of raw materials and products, and transportation costs. Bakeries, dairy plants, and frozen seafood processors deal with perishable raw materials, so they often locate themselves close to suppliers. The Guiding principle in such cases is weight losing. If the raw material loses a lot of weight in processing, then the plant should be located nearer to the source of raw materials. Another principle is weight balancing i.e. relative cost of transporting raw materials must be weighed against the cost of shipping the finished products. Thus, steel industry should be located near the coal and iron ore supply. Most of the steel plants in India are located in the region where coal, iron ores, and other raw materials are available. Tata steel, and steel plants under SAIL are also examples to justify this guidelines. Nearness to an Existing Plant It is advisable to keep the new plant reasonably close to the parent plant. Thus the truck assembly plant can be kept close to a steel plant because the two plants can act as complementary to each other. Product of one becomes the raw materials for the other. Again one can see why Telco and Tata steel in Jamshedpur are located nearer to each other. This way, executive supervision and staff consultations can be made common and cost reduction will be
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possible. Engineers and executives can make frequent trips to do the consultation and supervision work. Transportation Some companies find it desirable to be located near the seaport or near one of the inland waterways to take advantage of the lower cost of transporting materials (e.g., coal, iron ore, petroleum products, etc.) by boat, barge, or ship. Access to railroad or trucking facilities is also desirable. Power Supply It is desirable to have power supply at low cost for the operation of the plant. Cost of power supply per unit is generally cheaper in rural location than its urban counterpart. Some companies prefer to maintain their own standby power station. Water Disposal and Pollution Anti-pollution law should be followed to avoid water pollution. Waste materials dumped into the rivers or stream may create problems for new company needing a supply of fresh and pure water. For example, companies manufacturing antibiotics, steel, chemicals, and those using radioactive materials are confronted with waste disposal problems. Some of the examples related to environment issues include: three mile island (USA), Cello field (UK), Chernobyl (USSR), and Union carbide (India). Most countries have laws to prevent the companies from dumping the industrial wastes into rivers. Some of the site related problems in India that have surfaced in media are: Mathura oil refinery vs The Taj Mahal, Barauni oil refinery vs The Ganges river, Paradip port vs Cyclone effect, Narmada dam vs environmental issues. Similarly, the environment issues in Mugher Cement Plant in Addis Ababa (Ethiopia) calls for relocation of this plant or convert the plant into an environment friendly one. Taxes Kinds and amounts of taxes (e.g., excise duty, sales tax, income tax, etc.) levied by a state should also be considered in locating a plant. The kinds of taxes and the basis for fixing them should be investigated before hand. Some states and territories offer tax exemption for a stipulated period of time to attract the investors to set up their plants to produce certain priority products. Climate Companies requiring controlled temperature, humidity, and ventilation should consider the climatic factor while locating the plant. For example, textile factories in India needing high humidity are located in Maharashtra, Gujarat, etc which are near the sea coast and have adequate humidity for the textile mills. Even the choice of the executives may affect the plant location. Similarly, companies interested in manufacturing computer components may be interested in a place with moderate climate and dust free environment. National Defense Industry related to defense or military hardware should be located on the basis of national defense interest and may preferably be away from the countrys borders. Community Administration and Attitude Local authorities and people should be willing to have the plant located in their area. Community should also provide the necessary municipal services, e.g. police and fire protection, maintenance of streets, waste disposal, etc. Worker attitude may also differ from
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country to country, region to region, and small town to city. Worker views about turnover, unions, and absenteeism are all relevant factors. Schools, Churches, Parks, and Residential Area It makes sense to pick up a town or locality that will provide the best services and living conditions for their employees and their families. Excellent schools, parks, hospitals, residential areas, etc. should be desirable. Space for Future Expansions Demand of products is dynamic in nature. It may be required to increase the production capacity of the plant in future if the demand increases or change the product altogether if the demand is very low. Thus, there should be an adequate space for future expansion or diversification of the plant. RURAL AND URBAN SITES COMPARED It has been seen above that some points are favorable in rural site, and some are good in an urban site. None of them is entirely good or bad from all points of view. A comparison between a rural and a urban sites with respect to various factors can be done as shown in Table 2.1. Urban site (located in city) Rural site (located in village) Very well connected by rail, roads, and air. Just the opposite. Rural sites are not easily accessible. Provides good market for the final products. Products need to be transported to some nearby markets.
GENERAL PROCEDURES FOR FACILITY LOCATION Location of a plant or an organization can be seen as a two step decision. First, one has to select a region, and second a choice of a site has to be made within the region. The first step depends on the plants long-term strategies like technological, marketing, resource mobilization, and financial strategies. However, the choice of a site within a region can be decided by comparing the relative availability and costs of required resources like: power, transport, labor, water, land, raw materials, in alternative sites. While comparing various sites, one has to take into account both tangible and intangible costs (climate, labor relations, community support, recreational facility, and presence of good schools, etc.) related to the sites. These are all discussed subsequently under the headings: preliminary screening, and selection of exact site. SELECTION OF EXACT SITE Different sites should be compared on the basis of various factors by asking relevant questions on each issues. Some of them are discussed below: Transportation facilities Is the location easily accessible by vehicles from the main highways? Are the railroad facilities sufficient for quick receipt and shipment of goods? Can a railroad siding be made available? Availability of water, power, gas and sewerage Is water available in sufficient quantity and of required quality? Is adequate power available or not? Is gas and sewer system adequate to the plants needs? Soil characteristics Is the bearing capacity of soil suitable to support the building and equipment? Will the soil provide adequate drainage? Drainage Will the area drain away all surface water so that the buildings or work area will not be flooded? Parking space Is adequate space available to provide for employees and visitors vehicles parking? Space for expansion Is enough space available for future expansion of the plant? Accessibility by workers
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Can the sites be reached by public transport ? Is the road and street network suitable for speedy entrance and exit of employees during rush hours or emergency? Cost of land Does the cost of land justify the selected site for the intended product? Can the location be shifted to some cheaper site with similar facilities? Existing buildings Are the existing buildings suitable for companys operation on rent or final purchase basis? Factors Ratings Factor ratings are used to evaluate location alternatives because (i) their simplicity helps decide why one site is better than another; (ii) they enable managers to bring diverse locational considerations into the evaluation process; and (iii) they foster consistency of judgment about location alternatives. The following steps are involved in factor rating: Develop a list of relevant factors. Assign a weight to each factor to indicate its relative importance (weights may total 1.00). Assign a common scale to each factor (e.g., 0 to 100 points), and designate any minimums. Score each potential location according to the designated scale, and multiply the scores by the weights. Total the points for each location, and choose the location with the maximum points. Example 2.1. A glass company is evaluating four locations A, B, C, and D for a new plant and has weighted the relevant factors as shown in Table 2.2. Scores have been assigned with higher values indicative of preferred conditions. Using these scores, develop a qualitative factor comparison for the four locations.
PLANT LAYOUT
Plant layout is defined as the most effective physical arrangement of machines, equipment, and service departments to have the best co-ordination and efficiency of man, machine and material in a plant. REASONS :Need to make minor correction in present layout due to method improvement, new type of inspection plan, and new type of product, Need to rearrange the existing layout due to various changes, Re-allocating the existing facilities due to new location, Building a new plant. EFFECTS OF A PLANT LAYOUT A good layout will result in the following: Material handling and transportation is minimized The movements made by workers are minimized. Waiting time of the semi-finished products is minimized. Bottlenecks are eliminated Overall satisfaction & simplification Increased production, safer working conditions, well ventilated rooms, clean environment, optimum spaces Increased flexibility , improved work methods and reduced production cycle time In other words, the layout design must consider how to achieve the following: Higher utilization of space, equipment, and people. Improved flow of information, materials, and people. Improved employee morale and safer working conditions. Improved customer/client interaction. Flexibility to change the layout that exists anytime. VARIABLES:Layouts are affected by types of industry, production systems, types of products, volume of production, and types of manufacturing processes Types of industries Synthetic process based industry: In this, two or more materials are mixed to get a product, e.g. cement Analytic process based industry: It is opposite of synthetic process. Here, the final products are obtained as a result of breaking of material into several parts. For example, the petroleum Conditioning process based industry: Here, the form of raw material is changed into the desired products, e.g. jute products in the jute industry, or the milk products in the dairy farm. Extractive process based industry: By applying heat, desired product is extracted from the raw material, e.g. Aluminum from bauxite, and steel from iron ores. Types of production system Continuous Production:-They are characterized by standardized, high-volume, capital-intensive products
Job Shop Production:-This is characterized by made-to-order, low volume, labor-intense products Batch Production:-They are characterized by medium size lots of the same type of item or product Type of product Whether the product is heavy or light, large or small, liquid or solid, etc. Volume of production Whether the production is in small quantity, or in lots or batches, or in huge quantity (mass production). PRINCIPLES OF PLANT LAYOUT Principle of overall integration (of man, materials, machine, supporting activities, etc) Principle of minimum distance between operations Principle of flow (arranging machines according to the sequence of operations) Principle of cubic space Principle of satisfaction and safety Principle of flexibility of rearrangement at a minimum cost. TYPES OF FLOW
CLASSIFICATION OF LAYOUT Layouts can be classified into the following five categories: 1. Process layout 2. Product layout 3. Combination layout 4. Fixed position layout 5. Group layout PROCESS LAYOUT:Process layout is recommended for batch production. All machines performing similar type of operations are grouped at one location in the process layout e.g., all lathes, milling machines, etc. are grouped in the shop will be clustered in like groups. Thus, in process layout the arrangement of facilities are grouped together according to their functions. The flow paths vary from product to product. paths are long and there will be possibility of backtracking.
Advantages machines are better utilized and fewer machines are required. Flexibility of equipment , personnel , work distribution Lower investment (less number of machines and lower cost of general purpose machines) Higher utilisation of production facilities. Expert Supervisors Limitations Backtracking and long movements Material handling cannot be mechanised which adds to cost. Lowered productivity due to number of set-ups. Throughput (time gap between in and out in the process) time is longer. Space and capital are tied up by work-in-process. PRODUCT LAYOUT machines and auxiliary services are located according to the processing sequence of the product. Special purpose machines are used which perform the required function quickly and reliably. The product layout is selected when the volume of production of a product is high such that a separate production line to manufacture it can be justified.
Advantages The flow of product will be smooth and logical in flow lines. In-process inventory, Throughput time is less. Minimum material handling cost.
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Reduced material handling cost due to mechanised handling systems and straight flow. Perfect line balancing which eliminates bottlenecks and idle capacity. Manufacturing cycle is short due to uninterrupted flow of materials. Small amount of work-in-process inventory. Unskilled workers can learn and manage the production. Limitations A breakdown of one machine in a product line may cause stoppages of machines in the downstream of the line. A change in product design may require major alterations in the layout. The line output is decided by the bottleneck machine. Comparatively high investment in equipments is required. Lack of flexibility. A change in product may require the facility modification. COMBINATION LAYOUT A combination of process and product layouts combines the advantages of both types of layouts. A combination layout is possible where an item is being made in different types and sizes. Here machinery is arranged in a process layout but the process grouping is then arranged in a sequence to manufacture various types and sizes of products.
FIXED POSITION LAYOUT This is also called the project type of layout. In this type of layout, the material, or major components remain in a fixed location and tools, machinery, men and other materials are brought to this location.
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Advantages and disadvantages Least movement of material Maximum flexibility Number of projects can be taken with same layout Low utilization of labour and equipment High equipment handling cost GROUP LAYOUT (OR CELLULAR LAYOUT) Group technology (GT) is the analysis and comparisons of items to group them into families with similar characteristics. GT can be used to develop a hybrid between pure process layout and pure flow line (product) layout. This technique is very useful for companies that produce variety of parts in small batches . first step is to determine component families or groups, second step is to arrange the plants equipment used to process a particular family of components. It reduces production planning time for jobs, reduces the set-up time. Thus group layout is a combination of the product layout and process layout. It combines the advantages of both layout systems. The basic aim of a group technology layout is to identify families of components that require similar of satisfying all the requirements of the machines are grouped into cells
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Group Technology layout can increase Component standardization and rationalization. Reliability of estimates. Effective machine operation and productivity. Customer service. It can decrease the Paper work and overall production time. Work-in-progress and work movement. Overall cost. Limitations of Group Technology Layout This type of layout may not be feasible for all situations. If the product mix is completely dissimilar, then we may not have meaningful cell formation.
MATERIAL HANDLING
Definition:Material handling embraces the basic operations in connection with the movement of bulk, packaged and individual products in a semi-solid or solid state by means of gravity manually or power-actuated equipment and within the limits of individual producing, fabricating, processing or service establishment the function dealing with the preparation,placing and positioning of materials to facilitate their movement or storage. It does not add any value to the product but adds to the cost of the product Out of the total time spent for manufacturing a product,20% of the time is utilised for actual processing on them while the remaining 80% of the time is spent in moving from one place to another, waiting for the processing. It is the art and science involving the movement, handling and storage of materials during different stages of manufacturing. Objectives of material handling Following are the objectives of material handling: 1. Minimise cost of material handling. 2. Minimise delays and interruptions by making available the materials at the point of use at right quantity and at right time. 3. Increase the productive capacity of the production facilities by effective utilisation of capacity and enhancing productivity. 4. Safety in material handling through improvement in working condition. 5. Maximum utilisation of material handling equipment. 6. Prevention of damages to materials. 7. Lower investment in process inventory. Principles of material handling 1. Planning principle: All handling activities should be planned.
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2. Systems principle: Plan a system integrating as many handling activities as possible and co-ordinating the full scope of operations (receiving, storage, production, inspection, packing, warehousing, supply and transportation). 3. Space utilisation principle: Make optimum use of cubic space. 4. Unit load principle: Increase quantity, size, weight of load handled. 5. Gravity principle: Utilise gravity to move a material wherever practicable. 6. Material flow principle: Plan an operation sequence and equipment arrangement to optimise material flow. 7. Simplification principle: Reduce combine or eliminate unnecessary movement and/or equipment. 8. Safety principle: Provide for safe handling methods and equipment. 9. Mechanisation principle: Use mechanical or automated material handling equipment. 10. Standardisation principle: Standardise method, types, size of material handling equipment. 11. Flexibility principle: Use methods and equipment that can perform a variety of task and applications. 12. Equipment selection principle: Consider all aspect of material, move and method to be utilised. 13. Dead weight principle: Reduce the ratio of dead weight to pay load in mobile equipment. 14. Motion principle: Equipment designed to transport material should be kept in motion. 15. Idle time principle: Reduce idle time/unproductive time of both MH equipment and man power. 16. Maintenance principle: Plan for preventive maintenance or scheduled repair of all handling equipment. 17. Obsolescence principle: Replace obsolete handling methods/equipment when more efficient method/equipment will improve operation. 18. Capacity principle: Use handling equipment to help achieve its full capacity. 19. Control principle: Use material handling equipment to improve production control, inventory control and other handling. 20. Performance principle: Determine efficiency of handling performance in terms of cost per unit handled which is the primary criterion. selection of material handling equipments Selection of material handling equipment is an important decision as it affects both cost and Efficiency of handling system. The following factors are to be taken into account while selecting Material handling equipment. 1. Properties of the material Whether it is solid, liquid or gas, and in what size, shape and weight it is to be moved. if a material is fragile, corrosive or toxic etc 2. Layout and characteristics of the building Another restricting factor is the availability of space for handling. Low-level ceiling may Restrict the use of hoists or cranes, and the presence of supporting columns in awkward Places can limit the size of the material-handling equipment. If the building is multi-storeyed, Chutes or ramps for industrial trucks may be used 3. Production flow
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If the flow is fairly constant between two fixed positions that are not likely to change, fixed Equipment such as conveyors or chutes can be successfully used. If, on the other hand, the Flow is not constant and the direction changes occasionally from one point to another because Several products are being produced simultaneously, moving equipment such as trucks would Be preferable. 4. Cost considerations Initial investment and operating and Maintenance costs are the major cost to be considered. By calculating and comparing the total Cost for each of the items of equipment, a more rational decision can be Reached on the most appropriate choice. 5. Nature of operations Selection of equipment also depends on nature of operations like whether handling is temporary Or permanent, whether the flow is continuous or intermittent and material flow pattern-vertical Or horizontal. 6. Engineering factors Selection of equipment also depends on engineering factors like door and ceiling dimensions, floor Space, floor conditions and structural strength. 7. Equipment reliability Reliability of the equipment and supplier reputation and the after sale service also plays an Important role in selecting material handling equipments. evaluation of material handling system The cost factors include investment cost, labour cost, and anticipated service hours per year, Utilization, and unit load carrying ability, loading and unloading characteristics, operating costs and size requirements are the factors for evolution of material handling equipment. Other factors to be considered are source of power, conditions where the equipment has to operate Time Effectiveness = time spent in the handling/ total time spent in production Cost Effectiveness= total expense/total weight handled ie expenses incurred per unit weight Handled Equipment utilisation ratio In order to know the total effort needed for moving materials, it may be necessary to Compute materials handling labour (MHL) ratio. This ratio is calculated as under: MHL =Personnel assigned to materials handling/ Total operating work force In order to ascertain whether is the handling system delivers materials work centres with Maximum efficiency, it is desirable to compute direct labour handling loss ratio. The ratio is: DLHL =Materials handling time lost of labour/ Total direct labour time
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material handing equipments Broadly material handling equipments can be classified into two categories, namely: ( a) fixed path equipments, and (b) variable path equipments. (a) fixed path equipments which move in a fixed path. Conveyors, monorail devices, chutes And pulley drive equipments belong to this category. (b) variable path equipments have no restrictions in the direction of movement although their size is a factor to be given due consideration trucks, forklifts mobile cranes and Industrial tractors belong to this category. Material handing equipments may be classified in five major categories. 1. Conveyors Conveyors are useful for moving material between two fixed workstations, either continuously Or intermittently. They are mainly used for continuous or mass production operations They are suitable for most operations where the flow is more or less steady. Conveyors may be Of various types, with rollers, wheels or belts to help move the material along: these may be Power-driven or may roll freely. The decision to provide conveyors must be taken with care, Since they are usually costly to install; moreover, they are less flexible and, where two or more Converge, it is necessary to coordinate the speeds at which the two conveyors move. 2. Industrial trucks Industrial trucks are more flexible in use than conveyors since they can move between various Points and are not permanently fixed in one place. They are, therefore, most suitable for intermittent Production and for handling various sizes and shapes of material. There are many types of truckpetrol- Driven, electric, hand-powered, and so on. Their greatest advantage lies in the wide range Of attachments available; these increase the trucks ability to handle various types and shapes of Material. 3. Cranes and hoists The major advantage of cranes and hoists is that they can move heavy materials through Overhead space. However, they can usually serve only a limited area. Here again, there are Several types of crane and hoist, and within each type there are various loading capacities. Cranes and hoists may be used both for intermittent and for continuous production. 4. Containers These are either dead containers (e.g. Cartons, barrels, skids, pallets) which hold the material To be transported but do not move themselves, or live containers (e.g. Wagons, wheelbarrows
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Or computer self-driven containers). Handling equipments of this kind can both contain and move The material, and is usually operated manually. 5. Robots Many types of robot exist. They vary in size, and in function and manoeuvrability. While many Robots are used for handling and transporting material, others are used to perform operations such As welding or spray painting. An advantage of robots is that they can perform in a hostile Environment such as unhealthy conditions or carry on arduous tasks such as the repetitive Movement of heavy materials. The choice of material-handling equipment among the various possibilities that exist is not Easy. In several cases the same material may be handled by various types of equipments, and The great diversity of equipment and attachments available does not make the problem any easier. In several cases, however, the nature of the material to be handled narrows the choice. Some Of the material handling equipment are shown in figs
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Classification 1. Equipment oriented system Overhead system Conveyor system Tractor trailer system Fork lift system Industrial truck system Underground system 2. Material oriented system Unit handling system Bulk handling system Liquid handling system 3. Methods oriented system Manual system Mechanized/automated Job- shop handling system Mass production handling 4. Function oriented system Transportation system Conveying system Transferring system Elevating system
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MAINTENANCE
Introduction and objectives
the work of keeping something in proper condition; to prevent a device or component from failing or to repair normal equipment degradation experienced with the operation of the device To keep the equipments in best operating conditions and in proper working order. to minimise excessive downtime and also interruption of production to reduce quality related problems to maintain economical cost and sustain value addition If a firm wants to be in the same business competitively, it has to take decision on whether to replace the equipment or to retain the old equipment by taking the cost of maintenance , operation ,procureing and installation. Types of maintenance Different approaches have been developed to know how maintenance can be performed to ensure equipment reaches or exceeds its design life Maintenance
Planned
Unplanned
Preventive
predictive
corrective
Emergency
Running
Schedule
Shutdown
breakdown
Planned maintenance:-organised maintenance work carried out as per procedure with control. Breakdown maintenance :-emergency procedure in which the plant or equip is operated until it fails and then brought back into running condition by repair; feasible for small factories with limited types of equip;no specialist are required. Corrective maintenance :-organised maintenance work intended to restore a failed unit, one tine job; full info on all the breakdowns and causes are obtained, tries to eliminate the cause once and for all. Preventive maintenance :-planned maintenance in order to prevent or minimise breakdown. Predictive maintenance :-predicting the failure before it occurs.
Breakdown (Reactive) Maintenance Breakdown maintenance is basically the run it till it breaks maintenance mode; still the predominant mode of maintenance; Advantages can be viewed as a double-edged sword. For new equipments minimum failure- so if we choose reactive M, then we save manpower and money but we are shortening the life of the equipment resulting in more frequent replacement. 18
S7- INDUSTRIAL ENGINEERING, VJCET Advantages 1. Involves low cost investment for maintenance. 2. Less staff is required. Disadvantages 1. Increased cost due to unplanned downtime of equipment. 2. Increased labour cost, especially if overtime is needed. 3. Cost involved with repair or replacement of equipment. 4. Possible secondary equipment or process damage from equipment failure. 5. Inefficient use of staff resources. Preventive Maintenance Actions performed on a time or maintenance that detect, preclude, or mitigate degradation of a component or system with the aim of sustaining or extending its useful life through controlling degradation to an acceptable level.; Preventive maintenance is a means to increase the reliability of their equipment, By expending the necessary resources to conduct maintenance activities intended by the equipment designer, equipment life is extended and its reliability is increased. Advantages 1. Cost effective in many capital intensive processes. 2. Flexibility. 3. Increased component life cycle. 4. Energy savings. 5. Extended life of equipment, efficiency, minimum failures Disadvantages 1. Catastrophic failures still likely to occur. 2. Labour intensive. Predictive Maintenance Measurements that detect the onset of a degradation mechanism, thereby allowing causal stressors to be eliminated or controlled prior to any significant deterioration in the component physical state. Basically, predictive maintenance differs from preventive maintenance , as one is based on actual condition of the machine where as Preventive maintenance is time-based; A good predictive maintenance program will eliminate catastrophic equipment failures. It can minimize or delete overtime cost , also It is possible to minimize inventory and order parts Advantages 1. Increased component operational life/availability. 2. Allows for pre-emptive corrective actions. 3. Decrease in equipment or process downtime. 4. Decrease in costs for parts and labour. 5. Better product quality. 6. Improved worker and environmental safety. 7. Improved worker moral. 8. Energy savings. Disadvantages 1. Increased investment in diagnostic equipment. 2. Increased investment in staff training.
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TOTAL PRODUCTIVE MAINTENANCE (TPM)

Total productive maintenance (TPM) is a maintenance program, which involves a newly defined concept for maintaining plants and equipment. The goal of the TPM program is to markedly increase production while, at the same time, increasing employee morale and job satisfaction and also to hold emergency and unscheduled maintenance to a minimum. objectives. Avoid wastage in a quickly changing economic environment. Producing goods without reducing product quality. Reduce cost. Produce a low batch quantity at the earliest possible time. Goods send to the customers must be non-defective. Similarities and Differences between TQM and TPM The TPM program closely resembles the popular Total Quality Management (TQM) program. Many of the tools such as, employee empowerment, benchmarking, documentation, etc. used in TQM are used to implement and optimize TPM. Following are the similarities between the two: 1. Total commitment to the program by upper level management 2. Employees empowerment 3. A long-range outlook The differences between TQM and TPM are summarized below.
Pillers of TPM
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S7- INDUSTRIAL ENGINEERING, VJCET PILLAR 1-5S TPM starts with 5S. Problems cannot be clearly seen when the work place is unorganized. Cleaning and organizing the workplace helps the team to uncover problems. Making problems visible is the first step of improvement.
PILLAR 2JISHU HOZEN (AUTONOMOUS MAINTENANCE) developing operators to be able to take care of small maintenance tasks, thus freeing up the skilled maintenance people to spend time on more value added activity and technical repairs. The operators are responsible for upkeep of their equipment to prevent it from deteriorating. PILLAR 3KAIZEN Kai means change, and Zen means good (for the better). Basically Kaizen is for small improvements, but carried out on a continual basis and involve all people in the organization. The principle behind is that a very large number of small improvements are more effective in an organizational environment than a few improvements of large value. This pillar is aimed at reducing losses in the workplace that affect our efficiencies. 1. Practice concepts of zero losses in every sphere of activity. 2. Relentless pursuit to achieve cost reduction targets in all resources. 3. Relentless pursuit to improve overall plant equipment effectiveness. 4. Extensive use of PM analysis as a tool for eliminating losses. Tools used in Kaizen 1. PM analysis 2. Why-Why analysis 3. Summary of losses 4. Kaizen register 5. Kaizen summary sheet. PILLAR 4PLANNED MAINTENANCE It is aimed to have trouble free machines and equipments producing defect free products for total customer satisfaction. This breaks maintenance down into 4 families or groups, which was defined earlier. 1. Preventive maintenance 2. Breakdown maintenance 3. Corrective maintenance 4. Maintenance prevention Policy 1. Achieve and sustain availability of machines; 2. Optimum maintenance cost; 3. Reduces spares inventory; and 4. Improve reliability and maintainability of machines. 21
S7- INDUSTRIAL ENGINEERING, VJCET PILLAR 5QUALITY MAINTENANCE It is aimed towards customer satisfaction through highest quality through defect free manufacturing. We gain understanding of what parts of the equipment affect product quality and begin to eliminate current quality concerns, then move to potential quality concerns Policy 1. Defect free conditions and control of equipments; 2 to support quality assurance; 3. Focus of prevention of defects at source; 4. Focus on poka-yoke (fool proof system); PILLAR 6TRAINING It is aimed to have multi-skilled employees with high morale . It is not sufficient know only Know-How by they should also learn Know-Why. The goal is to create a factory full of experts. PILLAR 7OFFICE TPM Office TPM should be started after activating four other pillars of TPM (JH, KK, QM,PM). Office TPM must be followed to improve productivity, efficiency in the administrative functions and identify and eliminate losses. This includes analyzing processes and procedures towards increased office automation. Office TPM addresses twelve major losses. PILLAR 8SAFETY, HEALTH AND ENVIRONMENT In this area focus is on to create a safe workplace and a surrounding area that is not damaged by our process or procedures. Target 1. Zero accident, 2. Zero health damage, and 3. Zero fires.
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DEPRECIATION
In any machine performing useful work wear and tear is present , it can be minimised by maintenance but cannot be fully prevented. Therefore its efficiancy and value reduces with time .this is known as depreciation. So some money is kept aside so that when the machine become uneconomical ,it can be replaced by a new one. New machine cost+installation charges+ repair charges-scrape is calculated and charged with overheads for the entire working life of the machine. Obsolescence is depreciation of existing machine due to new and better invention , design, equipment process etc.. types of depreciation:-
Due to wear and tear- when machines performs work wear and tear occurs.proper lubricating and cooling can minimise it but cannot prevent it. Physical decay-certain materials like insualtion, cables, furniture, chemicals etc get decay because of environmental effects Accidental-accidents occur by some wrong operation,loose components which may result in heavy damages. Neglect-not following proper instuctions given by the manufacturer Inadequacy-reduction in efficiancy of an asset. Obsolesence-reductio n in efficiancy and value due to the arrival of new and better invention , design, equipment process etc..
Methods of calculating depreciation: Straight line method Diminishing balance method Sinking fund method Annuity charging method Insurance policy method (Endowment policy) Revaluation or regular valuation method Machine hour basis method Sum of the years digits method
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S7- INDUSTRIAL ENGINEERING, VJCET Straight line method:- assumes loss of value to the machine is directly proportional to age. Also known as fixed installment method.same amt is deducted every year . no consideration is given to maintanence or repair charges. (Depreciation amount per year) D=(C-S)/N where C initial cost, S-scrape value and N- no of years Diminishing balance method-also called reducing balance method. The value deducted will be greater in early years , when repairs and maintenance are not costly Certain percentage of the book value of the equipment (which goes on decreasing year by year)is taken as depresiation amount 1/N (Fixed percentage taken to calulate yearly depreciation ) x=1-(S/C) where C=initial cost, S= scrape value and N= no of years. Sinking fund method- depreciation will be equal to the actual loss in the value of the machine taking into account its interest . this is constant throught the entire life of the machine. N (Depreciation amount per year) D=(R(C-S))/(1+R) -1 where R=rate of interest,C=total cost of machine, S= scrape value, N=no of years Annuity charging method-here interest is charged on the cost of machine every year on the book value, but the rate of depreciation is constant every year N N (Depreciation Rate ) D={[C(1+R) -S][1-(1+R)]}/[1-(1+R) ] where C=cost of the machine,S=scrape value, N=no of years, R=rate of interest Insurance policy method-the machine is insured and premiums are paid. When the policy matures the machine is replaced.. Revaluation method-every year the value of machine is revaluated and the difference in the book value and the revaluated value is charged as depreciation Machine hour basis method-here the rate of depreciation is calculated considering the total number of hours a machine runs in a year Sum of years digit method-Reduction value will be greater initially and it will go on decreasing gradually The net amount is spread over the whole life in a decreasing proportion Reasons for Replacement Deterioration decline in performance, may occur due to wear & tear, misalignmnt, increases maintenance and labour costs, decreases qlty,production rate, efficiency. Obsolescence Inadequacy Working conditions old machines which create unpleasent and hazardous working conditions
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S7- INDUSTRIAL ENGINEERING, VJCET Methods for replacement studies Pay back period method:- It determines as to how long it will take to pay back the invested capital , P = C/R where P=pay back period, C=original investment, R=annual return expected, Not reliable , Return is constant Total life average method:- In this all costs involved in buying, operating, and maintaining an equipment are added together into one figure and divided by total estimated life Annual cost method:- To compare the annual costs of obtaining service from different equipments , Annual cost = capital recovery+ operating cost Present worth method:- Accurate method , Used to evaluate the present value of the new n equipment , F= P(1+i) , P = F/(1+i)n where F=worth of money in future, P=present amt of money,i=interest rate, n=number of years. Rate of return method :- Average annual net income is expressed as percentage of capital investment , %return rate = (earnings per year/net investment ) X 100, (Discounted rate of return) C = R/(1+r)n where C=investment cost, R=expected earning in the nth year, r=rate of return, n=no of years MAPI method :- Machinery Allied Products Institute, Use widely , adjusted after-tax rate of return criterion, Cost is based on process and system performance , It estimates the initial rate of return and not average rate of return , it allows obsolescence, Uses charts and forms to reduce calculations 1 A one year comparison period and sum of digits tax depreciation method 2 A - one year comparison period and double declining balance tax depreciation 3 A - one year comparison period and straight line tax depreciation
Advantages :-Calculations are simple, Replacement timeis known , Can be applied to a single or combination of machines , aids inBudgeting , full provision for future deterioration and obsolescence on new machines
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Industrial Engineering - Module Ii Plant Location: Reasons For Location Changes

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S7- INDUSTRIAL ENGINEERING, VJCET