Acknowledgement

Any work is deemed incomplete without a guiding factor to help one tread in the right
path. So, I express my sincere thanks to the Head of Department and faculty of the
Department of Industrial Engineering and Management, BMSCE.

This work has been a success due to my parents who have extended their support and
encouraged me to perform better and deliver my best.

Finally my sincere gratitude to my friends and family who have always been a constant
source of support in all endeavors of life.

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Contents

Sl. no Chapters Pg no
1 Abstract 3

2 Introduction 4

3 Literature review 6

4 Assessment of cellular manufacturing 7

5 Design of cellular manufacturing 10

6 Cell implementation phase 11

7 Benefits and limitations 14

8 Case study 15

9 Conclusion 19

10 References 20

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1.Abstract
Cellular manufacturing (CM) is an application of group technology philosophy. It
recognizes the fact that small-to-medium sized batches of large variety of part types can
be produced in a flow line manner in different manufacturing cells. By applying cellular
manufacturing to produce part families with similar manufacturing processes and stable
demand, plants expect to reduce costs and lead-times and improve quality and delivery
performance.

This report proposes a method for introducing cellular manufacturing in a small

scale industry. The report outlines the method for assessing, designing and implementing
cellular manufacturing and illustrates the process with a case study.

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2.Introduction
Customers demand variety and customization as well as specific quantities
delivered at specific times; a lean producer must remain flexible enough to serve its
customers’ needs. Cellular manufacturing allows companies to provide their customers
with the right product at the right time. It does this by grouping similar products into
families that can be processed on the same equipment in the same sequence. To
successfully maintain “one piece flow” in their manufacturing cells, companies employ
quick changeover techniques.

Cellular Manufacturing (CM) refers to a manufacturing system wherein the

equipment and workstations are arranged in an efficient sequence that allows a
continuous and smooth movement of inventories and materials to produce products from
start to finish in a single process flow, while incurring minimal transport or waiting time,
or any delay for that matter. CM is an important ingredient of lean manufacturing.

In order to set up a single process flow (or single product flow) line, it is necessary
to locate all the different equipment needed to manufacture the product together in the
same production area. This is in contrast with the traditional 'batch and queue' set-up
wherein only similar equipment is put in the same area. Under a 'batch and queue' set-up,
products that need to undergo processing under certain equipment need to be transported
to the area where the equipment is located. There they are queued for processing in
batches. Such a system sometimes results in transport and batching delays. In a single
process flow set-up, the products simply transfer from one equipment to the next along
the same production line in a free-flowing manner, avoiding transport and batching
delays.

A cell is a group of workstations, machines or equipment arranged such that a

product can be processed progressively from one workstation to another without having
to wait for a batch to be completed and without additional handling between operations.
Cells may be dedicated to a process, a sub-component, or an entire product. Integral to
the manufacturing operations of a lean producer, cells are conducive to single-piece and

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one-touch manufacturing methods .Cells may be designed for administrative as well as
manufacturing operations.

A work cell is a work unit larger than an individual machine or workstation but
smaller than the usual department. Typically, it has 3–12 people and 10–15 workstations
in a compact arrangement. An ideal cell manufactures a narrow range of highly similar
products. Such an ideal cell is self-contained with all necessary equipment and resources.
Cellular layouts organize departments around a product or a narrow range of similar
processing begins, they move directly from process to process (or sit in mini-queues).
The result is very fast throughput. Communication is easy since every operator is close to
the others. This improves quality and coordination. Proximity and a common Mission
enhance teamwork.

Because of the free flow of materials in cellular manufacturing, it has the ability to
produce products just in time. This means that every unit processed at one station will get
processed in the next station. As such, no inventories that have already undergone
processing at one station will be left unprocessed in another station. This prevents the
build-up of non-moving inventories, which are products that have already incurred some
production costs but can not generate revenues because they are stuck somewhere along
the process. Aside from preventing non-moving inventories, process issues are
immediately detected by just-in-time production, since defective products are seen earlier
than if products are manufactured in large batches and queued.

One technique that cellular manufacturing can use to achieve 'just-in-time'

production is the 'pull system', wherein required inventories and materials are requested
or 'pulled in' by each station from the station preceding it. This 'pull' can originate from
the end customer itself, thereby ensuring that the products manufactured are only those
needed to satisfy a customer order. This prevents wastes from products not being sold.
The benefits of CM include WIP reduction, space utilization, lead time reduction,
productivity improvement, quality improvement, enhanced teamwork and
communication, enhanced flexibility and visibility.

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3.Literature review of Cellular Manufacturing
Cellular manufacturing is a fairly new application of group technology, although
the Portsmouth Block Mills offers what by definition constitutes an early example of
cellular manufacturing. By 1808, using machinery designed by Isambard Brunel and
constructed by Henry Maudslay, the Block Mills were producting 130,000 blocks
(pulleys) for the Royal navy per year in single unit lots, with 10 men operating 42
machines arranged in three production flow lines. This installation apparently reduced
manpower requirements by 90% (from 110 to 10), reduced cost substantially and greatly
improved block consistency and quality.
Group technology is a management strategy with long term goals of staying in
business, growing, and making profits. Companies are under relentless pressure to reduce
costs while meeting the high quality expectations of the customer to maintain a
competitive advantage. Successfully implementing Cellular manufacturing allows
companies to achieve cost savings and quality improvements, especially when combined
with the other aspects of lean manufacturing. Cell manufacturing systems are currently
used to manufacture anything from hydraulic and engine pumps used in aircraft to plastic
packaging components made using injection molding.

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4.Assessment of cellular manufacturing
Assessing of cellular manufacturing is done in 2 ways and is:

4.1.Product–process matrix
The product-process matrix (Hayes and Wheelwright 1979) links
the product and process life-cycles with the intent of providing a
means to assess whether or not a firm has properly matched its
production process to the product structure. As shown in Figure.1, the
matrix suggests that as the sales volume of the product increases, the
process flowshould become more continuous.This iswhat onewould
expect, aswhen volumes grow, automation may be introduced and
lines may be dedicated to the product. Since traditionally the small
scale industry has considered itself a low-volume producer, until
recently the majority of its operations had opted for a flexible process
layout, to permit them to handle small quantities of a large variety of
products. As a result, machines are grouped by function to minimize
machine idle time and maximize machine utilization (Dul 1994) in what
is often called a job shop layout.

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 Figure 1: Product-process matrix

4.2.Functional and Product flow layouts

The jumbled flow and disconnected line flow of the product- process matrix
correspond to what is often known as a functional layout or job shop. In a functional
layout equipment with the same function is located together, providing a great deal of
flexibility; therefore a wide variety of products can be manufactured at a low volume. It
also allows for easier training of workers as they have the opportunity to learn from each
other when they are collocated. However, the functional layout has several disadvantages.
For example, as the number of products and machine type’s increase, scheduling
complexity increases substantially. Since the products travel a lot around the factory,
lead-times are higher and it becomes difficult to track down thework-inprogress (WIP).
Also, batching products before they move to the next step in the process increases WIP
and hides quality problems. Thus defects are found late in the process and are generally
costlier to correct, as there is already a large number of products in the pipeline that have
to be reworked or scrapped (Arnold et al. 1996). Since maximizing machine utilization is

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an important metric in this environment, larger batch sizes are preferable tominimize
change-over and set-up costs. This incentive of increasing machine utilization causes an
increase in inventory costs, in terms of both work-inprogress and finished goods and
perpetuates long lead times and decreasing throughput. Goldratt in his book “The Goal”
(Goldratt and Cox 1984) has warned managers from using machine utilization as a
driving metric, but in a functional layout it is hard to resist this temptation and succumb
to large inefficiencies for the sake of keeping all the machines busy.

Product-flow layouts correspond to the connected line flow in the product process
matrix. These layouts are used when the product volumes are large enough to justify a
dedicated line to support a sequence of operations, i.e. machines located according to the
line of flow of the product. The main advantages of this layout are the reduction of WIP
as batching is eliminated, and no products are accumulated between process steps. Since
waiting times are reduced considerably, cycle times decrease and output is higher. One of
the main disadvantages of the product-flow layouts is lack of flexibility, as only one or a
very small number of products may be manufactured in one line, and accommodating
product changes or new products can be difficult and costly. Product- flowlayouts also
require high initial capital investment to purchase dedicated manufacturing and handling
equipment which are connected “in series”. However, when one of the pieces of
equipment breaks it can cause the whole line to stop, or at least considerable disruptions
in production. In figure 2 and figure 3 functional and product flow layouts are shown
respectively.

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 Figure.2: Functional layout

Figure .3: Product layout

5. Design of cellular manufacturing

The goal of cellular manufacturing is having the flexibility to produce a high variety
of low demand products, while maintaining the high productivity of large scale

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production. Cell designers achieve this through modularity in both process design and
product design.

5.1.Process Design

The division of the entire production process into discrete segments, and the
assignment of each segment to a work cell, introduces the modularity of processes. If any
segment of the process needs to be changed, only the particular cell would be affected,
not the entire production line. For example, if a particular component was prone to
defects, and this could be solved by upgrading the equipment, a new work cell could be
designed and prepared while the obsolete cell continued production. Once the new cell is
tested and ready for production, the incoming parts to and outgoing parts from the old
cell will simply be rerouted to the new cell without having to disrupt the entire
production line. In this way, work cells enable the flexibility to upgrade processes and
make variations to products to better suit customer demands while largely reducing or
eliminating the costs of stoppages. While the machinery may be functionally dissimilar,
the family of parts produced contains similar processing requirements or has geometric
similarities. Thus, all parts basically follow the same routing with some minor variations
(e.g., skipping an operation). The cells may have no conveyorized movement of parts
between machines, or they may have a flow line connected by a conveyor that can
provide automatic transfer.

5.2. Product Design

Product modularity must match the modularity of processes. Even though the entire
production system becomes more flexible, each individual cell is still optimised for a
relatively narrow range of tasks, in order to take advantage of the mass-production
efficiencies of specialisation and scale. To the extent that a large variety of products can
be designed to be assembled from a small number of modular parts, both high product
variety and high productivity can be achieved. For example, a varied range of
automobiles may be designed to use the same chassis, a small number of engine
configurations, and a moderate variety of car bodies, each available in a range of colors.

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In this way, a large variety of automobiles, with different performances and appearances
and functions, can be produced by combining the outputs from a more limited number of
work cells.

6. Cell implementation phase

The cell implementation phase executes the cell design. Then, through on-going
performance measurements it identifies areas of success and further challenges in the
cell. A strategy is only as good as its implementation, therefore having a well prepared
execution plan is very important. The success of the implementation can be monitored in
time through performance measurements to ensure that continuous improvement is
achieved. Thus the two main steps in this phase are implementation and performance
measurement. In an existing production environment, theremay be already established
teams or process improvement activities that can be used as vehicles for implementation.
This section discusses these topics further and presents the outcome of these steps in
detail.To ensures that the cell runs smoothly, the commitment of those who work in it and
with it is essential. Any staff involved in the operation of the cell should be part of the
decision making process at the design stage and be invited to share their views, skills and
experience. This involvement and input often release stifled talents and skills, including
leadership, innovation and forward planning; and without it is very difficult to change
working practices (Thorn 1996). The implementation step offers the opportunity to
involve in a larger scale all those who “work with and in it”. This is an important point
because when introducing a cell in a producing shop there is a tendency to minimize
disturbances to production by limiting the number of participants in the cell
implementation activity. However, employees that do not participate may not feel
compelled to the cell idea, and the effectiveness of the cell can be greatly diminished.

The implementation check lists proposed are given below.

6.1. Identify implementation mechanism

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 Regardless of what vehicle is used to implement the cell (shop floor teams, quality
circles, kaizen events); there are two key elements that must be present in the
implementation activity: leadership/facilitation and schedule allowing time for training
and doing. It is important that the leaders/facilitators have a good understanding of CM
concepts and are involved as early as possible in the cell planning phase. They are
responsible for teaching these concepts to the participants, and for balancing the schedule
of the implementation activity such that there is time to establish the goals, provide the
necessary training, and allow time for the participants to brainstorm and implement their
ideas. If there are no existing implementation vehicles within the company that
incorporate these elements, the cell vision team needs to plan and provide one.

6.2. Inform all employees of cell implementation

Prior to the implementation activity, employees in the shop should be informed of
the upcoming plans to introduce a cell. This can be easily accomplished at daily or
weekly meetings. Although some employees may not embrace the planned change, it is
important that all are informed one to two weeks ahead of time. By doing so, the next
step of dentifying the participants list may be facilitated through the interaction between
operators and supervisors.

6.3. Identify cell implementation participants

Shop floor and support personnel must be identified and notified prior to
implementation. As stated earlier, in as much as possible, all those who work with or in
the cell should participate.

6.4. Provide data and resources during implementation

Since the implementation activity takes place during “production time” data and
resources needed in this period should be obtained ahead of time so that the time can be
used more efficiently in “brainstorming” and doing rather than “hunting” for information.

6.5.Do as much as possible, and schedule remaining action

Items

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 Sufficient time should be allowed for “doing” during the implementation activity.
By doing as many of the necessary tasks as possible during this time, the cell gains
tremendous momentum. Realistically, some activities, like equipment relocationmay are
difficult to complete during the implementation activity. In this case, a schedule of
remaining action items needs to be established. It is suggested that aggressive deadlines
be imposed or remaining action items to maintain a sense of momentum.

6.6. Inculcate importance of metrics

Throughout the implementation activity, participants must remain aware of the need to
“keep track” of improvements through metrics. Therefore, participants must not only be
encouraged to be creative about improvement, but also about how to measure its impact
through already existing or newly created metrics.

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7.Cellular manufacturing: Benefits and Limitations
CM offers an opportunity to combine the efficiency of product flow layouts with the
flexibility of functional layouts. In CM, products with similar process requirements are
placed into families and manufactured in a cell consisting of functionally dissimilar
machines dedicated to the production of one or more part families (Shafer and Charnes
1995). By grouping similar products into families, the volume increases justifying the
dedication of equipment. But since this volume is justified by process and product
similarity, CM warrants much more flexibility than a pure product-flow layout. In terms
of the Product–Process matrix, CM allows movement down the vertical axis, i.e. it allows
increasing the continuity of the manufacturing process flow without demanding that the
products be made in large volumes.
The benefits of CM include faster throughput times, improved product quality,
lower work-in-process (WIP) levels and reduced set-up times (Wemmerlov and Hyer
1989). These gains are achieved because the batch sizes can be significantly reduced. As
set-up times decrease through the use of common tools or the collaboration of cell
workers during set-up times, batch size can be reduced. The shorter the set-up time the
smaller the batch size, and as a goal a batch size of one is feasible when set-up time is
zero.Within a cell, small batch sizes do not travel very far as machines are co located,
resulting in less work-in-progress, shorter lead times and much less complexity in
production scheduling and shop floor control.
Unfortunately, in a cellular layout as in the product-flow layout, a machine break
down may still cause a work stoppage in the cell. Another limitation of this approach is
that to ensure cell profitability and low unit costs, a large enough volume of products
must be processed within the cell so that capital expense of buying the dedicated
equipment to each product is low. Managers, who disregard this fact when pursuing the
improvements that CM promises, may end up with fewer benefits than expected.

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8. Case Study
Adopting Cellular Manufacturing taking an example of
Gear Manufacturing Machine Shop
8.1.Assessment of gear manufacturing machine shop
The small scale industry which manufactures gears components for automotive and
other application which is considered for research showed that the typical machine shop
facility is characterized by batch-oriented processes, large monument-like equipment, a
large variety of gears being produced at any time in the facility and manual shop floor
communications between machine operators, forklift drivers and plant
managers/supervisors. This dispersion of the manufacturing assets, and the functional
layout of the facility at each location, results in a Value Added Ratio (Actual Man
Hours/Total Lead Time) of about 10%.
Gears that have a high unit price are seen to have the highest lead times in both
dimensions, which is the primary reason for high WIP costs. However, it must be
recognized that the typical manufacturer operates in a Make-To-Order business
environment. These small scale manufacturers do not have an extensive suite of well-
documented, easy-to-use and thoroughly validated methods and tools to support their
implementation of CM. Clearly, there is a need for new concepts and analysis tools
specifically suited for Gear manufacturing machine shops to implement CM in a manner
that suits their business model and manufacturing environments.

8.2.Implementing cellular manufacturing in gear manufacturing

machine shops
Naturally, the first question that will be asked is, “How do we implement the
proposed CM strategy? The answer is: Through the integration of Group Technology to
decompose a product mix into part families and CM to design a flexible facility layout.
Group Technology seeks to identify and group together similar parts to take advantage of
their similarities in manufacturing and design. CM is an application of the Group
Technology concept specifically for factory reconfiguration and layout design. Small

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scale production units are complex high-variety low-volume manufacturing facilities
where the changes in product mix, volume, customer base, workforce skills, process
technology, etc. are significant. A complete reorganization of a typical small scale
industry into a Cellular Layout may be ill-advised due to the inherent inflexibility of
manufacturing cells to adapt to changes in their product mix, demand volumes and
capacity requirements (machine and labor) to meet production schedules. Hybrid Cellular
Layouts, unlike the traditional network of manufacturing cells, provide an effective
foundation for job shops to configure their shop floors differently from the typical
assembly facility. These layouts integrate the flexibility of a Process Layout with the
order flow tracking and control of a cellular layout. They are designed based on the
principles of design for flow to achieve waste-free, and therefore high-velocity, flows of
orders in a Make-To-Order realm without necessitating repeated shop floor
reconfiguration. Here is a sample of challenging ideas that needs to be implemented for
effective CM:
(a) To identify and implement not just a single “pilot” cell, but all potential cells for
different families of parts that may exist in its large product mix.
(b) To implement virtual (dynamic and reconfigurable) cells for a portion of its product
mix.
(c) To develop a self-motivated workforce knowledgeable in Industrial Engineering skills
who seek to eliminate muda in a wide variety of administrative and production processes
on a daily basis.
(d) To adopt the concepts and models of Lean Thinking depending on demand forecasts.
(e) To develop a partnership with its suppliers in order to better estimate and control
supplier delivery schedules.
(f) To define it’s “core manufacturing competencies” into a guidebook that its sales staff
could use to accept, evaluate or reject new orders based on past cost/benefit performance
measures.
(g) To implement Finite Capacity Scheduling without purchasing expensive software,
since Theory of Constraints and Drum-Buffer-Rope scheduling have been known to
succeed in such facilities.

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 (h) To achieve flow and be flexible to changes in product mix, demand and
manufacturing technology.

8.3.Performance measurement
By identifying relevant metrics and measuring them, managers receive the
necessary feedback to ensure that the projected benefits are realized, and to fuel the
continuous improvement process. It is important to remember that metrics need to be
defined carefully, as often “what one measures is what one gets”. If the metrics do not
truly reflect the goals of the change, the effectiveness of the improvement can be greatly
diminished. This issue is particularly relevant when introducing a cell in an existing
production environment. All of the metrics in the existing job shop may not be relevant in
CM Environment. This ensures that the cell can be examined by management in the
context of the shop, and alignment of (at least some) metrics with the existing objectives,
which may be much more difficult to change than the production process. The metrics
that was considered for the cell performance measurement was monthly throughput and
flow hours in a cell. The performance analysis is shown in table 1 and table 2 where the
monthly throughput and average no of manufacturing hours a product spends on the shop
floor is shown respectively.
Table 1: Shows monthly throughput. For ex Main gear which was manufactured over a
period of time without CM implementation was on an average of 60 parts per month.
After implementation it improved to an average of 90 parts per month, almost 30 parts
more in one month simply due to the coordinated efforts of all the things mentioned
above in this report.
Table 2: shows average number of manufacturing hours a product spends on the shop
floor. For Ex main gear used to spend on an average 57 h on the shop floor before
implementing CM. After implementation it spends just 30 h on an average. Almost 27–28
h is saved and that much of inventory and other related things are saved purely due to
coordinated efforts.

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Table 1: Shows monthly throughput. For ex Main gear which was manufactured over a
period of time without CM implementation was on an average of 60 parts per month.
After implementation it improved to an average of 90 parts per month, almost 30 parts
more in one month.

Table 2: shows average number of manufacturing hours a product spends on the shop
floor. For Ex main gear used to spend on an average 57 hours on the shop floor before
implementing CM. After implementation it spends just 30 h on an average. Almost 27–28
hours is saved and that much of inventory .

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9. Conclusion
The goal of this work was in two folds: Primary aim was to achieve the objectives to
implement the CM technology in a small scale industry and secondary to document the
learning from interaction with the industry and these have been accomplished. The
approach to cell design and implementation process proposed in this report was used to
implement the ideas at a small scale industry, and it has begun to realize the benefits
expected from the cell. In conclusion, this paper has shown that when a job shop
manufactures a group of products with similar characteristics and stable demand, CM can
be a very effective way to obtain performance improvements. The method proposed in
the report is recommended to design and implement CM in existing job shop
environments.

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10. References
1. Shishir Bhat, “A strategy for implementing the idea of cellular manufacturing in
small scale industries” Journal on Production planning and control, volume 19,
no. 6, September 2008.
2. http://www.springerlink.com/content/p002h4l7k7374165/, February 21, 2009
3. http://www.siliconfareast.com/cellular-manufacturing.htm, February 25,2009
4. http://www.strategosinc.com/cellular_manufacturing.htm, February 25,2009
5. http://www.informaworld.com/smpp/content~content=a906413273~db=all~jumpt
ype=rss, March 4, 2009

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