INTRODUCTION

Ashok Leyland is a well known automobile manufacturing company in India.

Ashok Leyland believe that its historical success and future prospects are directly
related to combination of strengths.

This project is titled as a study on functional areas in Ashok Leyland and tries to
find out the different aspects of manufacturing process in the company. The
project was held at Hosur, Unit I from 22 to 30 June 2009.

Different officials working in various departments have provided very important

data in this report. Every effort has been made to understand the functions and
activities of various departments as well as the manufacturing process.

1
 ABSTRACT

The report provides a consolidated preview of the functional activities of Ashok

Leyland, Hosur Unit I.The referred unit is a core limb of Ashok Leyland,the
nation’s pioneering automobile manufacturer.The core departments, their primary
functions and the integrating activities are described in the report. Other special
regulatory functions like evaluation methods, employee benefit schemes have also
been covered.

The unique features and policies of the company, which make it a leader without
contention and have aided the company in carving an excellent niche for itself in
the national and the international arena, have also been referred.

2
 OBJECTIVES OF THE STUDY

The objectives of the study are:

• To familiarize with business organization.

• Getting practical experience regarding the organizational function.
• To learn about the policies and functions of the organization.
• To understand the culture in the organization and its effect on employees.
• To get industrial exposure and experience.
• To understand the production and marketing methods.

METHODOLOGY

This study was undertaken by undergoing a training program at Ashok Leyland

for about a fortnight. The information was collected by interacting and
interviewing with the concerned personnel of various functional departments.

The methodology used for the study is through the collection of primary and
secondary data. Primary data is collected through direct observation and live
discussion with the managers and the staff members. Secondary data is
collected through Annual Reports, Business Journals, Existing Records and
also from the website of the company.

3
 SCOPE OF THE STUDY

The study is mainly based on the details collected from each department. It
provides a better understanding at functional level of each department. It
provides a better understanding at functional level of each department i.e.
Purchase, Materials, Production, Marketing, Finance and Human Resource
Management. Each and every activity of the company has been studied very
carefully with the data available. Apart from that I gained knowledge of the
functioning of different departments and their inter relationship with each
other. This study helped me familiarize with the manufacturing and assembling
of commercial vehicles.

4
 COMPANY PROFILE

Ashok Leyland has been a major presence in India’s commercial vehicle industry
since 1948, the year it was born. The origin of Ashok Leyland can be traced to the
urge for self-reliance, felt by independent India. Pandit Jawaharlal Nehru, India's
first Prime Minister persuaded Mr. Raghunandan Saran, an industrialist, to enter
automotive manufacture.

They are one of the India’s leading manufactures of commercial vehicles and
special vehicles, engines for industrial purpose, gen sets and marine requirement
equipments. For over five decades, Ashok Leyland has been the technology leader
in India’s commercial vehicle industry, molding the country’s commercial vehicle
profile by introducing technologies and product ideas that have gone on to become
industry norms.

Ashok Leyland at the time of its inception was known as Ashok Motors. It was
assembling Austin cars at the first plant, at Ennore, near Chennai. In 1950, the
company started assembly of Leyland commercial vehicles and soon the local
manufacturing under license from British Leyland, participation in the equity
capital, in 1954, the company was re christened Ashok Leyland.

Since its inception, Ashok Leyland has been a major presence and these years have
been punctuated by a number of technological innovations which went to become
industry standard. This tradition of technological innovations and leadership was
achieved through years of vigorous in-house research and development.

From 18 seater to 82 seater double-decker buses, from 7.5 tonne to 49 tonne in

haulage vehicles, from numerous special application vehicles to diesel engines for

5
industrial, marine and genset applications, Ashok Leyland offers a wide range of
products.

Ashok Leyland has six manufacturing plants -

Ennore Plant, Chennai.

Hosur Plants Unit I, Unit II and Unit II A.
Alwar, Rajasthan.
Bhandara, Maharashtra.

A new plant is to be set to be launched in Uttaranchal at Pant Nagar with a plant

capacity of 40,000 commercial vehicles. Early products of Ashok Leyland
included the Leyland Comet bus chassis sold to many operators including
Hyderabad Road Transport, Ahmedabad Municipality, Travancore State Transport,
Bombay State Transport and Delhi Road Transport Authority.

In the popular metro cities, four out of five state transport undertaking buses come
from Ashok Leyland. Some of them like the Double Decker and Vestibule buses
are unique models from Ashok Leyland, tailor made high-density routes.

Statistics reveal that the company is India’s largest exporter of medium and heavy
duty trucks. It sells close to 83,000 medium and heavy vehicles each year. The
company has a near 98.5% market share in the Marine Diesel engine markets in
India. At 60 million passengers a day, Ashok Leyland buses carry more people
than the entire Indian Railway network.

ORGANIZATION STRUCTURE

6
In 1987 the overseas holding by LRLIH (LAND ROVER LEYLAND
INTERNATIONAL HOLDINGS LIMITED) was taken over by a joint venture
between the Hinduja group, the Non Resident Indian Transnational group and
IVECO Fiat SPA part of the Fiat group and Europe’s leading truck manufacturing
company. Ashok P Hinduja is the chairman of the company. The Hinduja group
also associated with Ennore Foundries Limited, Automotive Coaches and
Components Limited, and Gulf Ashley Motors Limited.

The subsidiary holdings are Ashley Holdings Ltd., Ashley Investment Ltd., and
Ashok Leyland Project Services. The chief competitors of the company are;

• Mahindra
• Volvo
• Tata Motors

With a commanding strength of the about 12,000 employees the company is

looking forwards to enhance the sxope of its action. It is aiming at expanding its
production operation overseas to make it a more globally accessible company. It is
looking to acquire a small to medium sized commercial vehicle manufacturers in
China and other developing nations, which have an established product line. An
example would be the 2007 acquisition of the Czech based Avia’s truck business
rechristened Avia Ashok Leyland Motors.

VISION

7
Be among the top Indian corporations acknowledged nationally and internationally
for

- Excellence in quality of its products.

- Excellence in customer focus and service.
-

MISSION

Be a leader in the business of commercial vehicles,excelling in technology, quality

and value to customer fully supported by customer service of the highest order and

meeting national and international environmental and safety standards.

GEMBA

Gemba is a Japanese word meaning “Real Place” where the real action takes place.
In the manufacturing industry, there are 3 major activities directly related to
earning money, developing, producing and selling products.

GEMBA KAIZEN

8
 Three ground rules for practicing kaizen in Gemba.
1. House Keeping
2. Muda Elimination [Waste Elimination]
• Waste of over production
• Waste of inventory
• Waste of waiting
• Waste of Motion
• Waste of transportation
• Waste of Producing Rejects
• Waste of processing
3. Standardization.

GEMBA MISSION
N7i+1
New 7 initiatives
1. Increase in the number of GEMBA
2. 5s [SEIRI,SEITON,SEISO.SEIKETSU,SHITSUKE]
3. EEI (Effort and Ergonomy index)
4. CMI (Cost management initiative)
5. Inventory Initiative
6. Critical machine uptime
7. Quality
8. Safety

Vendor Opportunities:

9
Our Vendors are our valued partners in our business development and we shall
work with them in a spirit of mutual co-operation to meet our business objectives.

Vendor Development and Strategic Sourcing are handled by Corporate Materials

Department (CMD). CMD identifies the vendors, rates the vendors based on
feedback received from Supplier Quality Assurance Cell, sends drawings /
specifications, calls for quotes with detailed break-up of operation-wise costs, and
negotiates the price at which the parts will be supplied.

In addition to CMD at Ennore, and the two Units at Hosur, there are Materials
Management Departments (MMDs) for scheduling based on unit production plan.

Vendor Development of Strategic Sources:

Strategic Sourcing is central to the integrated Materials Management function.

Ashok Leyland's policy is to develop a vendor base committed to continuous
improvement to meet quality, cost and delivery standards.

Ashok Leyland considers its vendors as partners in progress and believes in

establishing mutually beneficial relationships. Ashok Leyland provides necessary
technical assistance in the form of Project and Production Engineering, to maintain
quality levels. In addition, where required, Ashok Leyland also helps vendors
financially.

Qualification Analysis – Executives

10
Ashok Leyland has a tie-up with BITS, Pilani for a custom-designed, off-campus
2-year MS course in Engineering Management. Aimed at making Managers out of
Engineers, assignments and projects are central to the learning process thus
bridging the classroom with the engineers' workplace. From 2000, a BS
programme in Industrial Engineering and Technology, is offered for diploma
holders, again in collaboration with BITS. Apart from updating their knowledge
base, the programme empowers engineers to acquire multiple skills.

Ashok Leyland is one of the moving forces behind an M.Tech course in

Automobile Engine Technology jointly managed by the automobile industry
(Indian Society for Automotive Technology, made up of auto manufacturers), IIT,
Madras and Institut Francais du Petrole, the French institute for IC engines.

ORGANISATION STRUCTIURE

11
 MANAGING DIRECTOR

EXECUTIVE DIRECTOR

SENIOR DIRECTOR

GENERAL MANAGER

DEPUTY GENERAL MANAGER

ASST. GENERAL MANAGER

DIVISIONAL MANAGER

SENIOR MANAGER

MANAGER

DIVISIONAL MANAGER

ASST. MANAGER

SENIOR OFFICER

OFFICER

12
 DEPARTMENT FUNCTIONS

The major functional areas of the unit and the major departments which oversee
those areas are catalogued as follows:

1. Personnel and Administration Department

2. Purchase & Material Planning Department
3. Production Department
4. Finance Department
5. Systems Department
6. Research & Development.

A brief review of each functional department and its activities as follows:

13
 PERSONNEL & ADMINISTRATION

Departmental Structure

DGM

DIVISIONAL Sr. MANAGER MEDICAL CHIEF SECURITY

MANAGER IR HR OFFICER OFFICER

-MANAGER -OFFICER
-MT -ASST. MANAGER
-DIVISIONAL -MT
MANAGER
-ASST. MANAGER

-OFFICERS

RECRUITMENT
Recruitment is the process of ‘finding and attracting capable applicants for
employment. The process begins when new recruits are sought and ends when
their applications are submitted. The result is a pool of applicants from which new
employees are selected.

14
SOURCES OF RECRUITMENT
The following are various external sources of recruitment:

 Consultancies
 Campus recruitment
 Lateral entries

1. CONSULTANCIES

The department heads where requirements are needed informs to the HR

department about the requirement. The concerned persons for recruitment gets
approval for filling the vacancies. Then the consultancies are approached telling
the requirements. The fit applications are mailed to attend the interview. If
satisfied, they are called for the personal interview.

2. CAMPUS RECRUITMENT

The recruitment panel goes to the reputed colleges to select the candidates.
On the following basis they recruit the candidates
 GETs - Graduate Engineer Training
 DETs - Diploma Engineer Training
 ITI

3.LATERAL ENTRIES

They pick the experience candidates or people from other companies. The
following is the process of lateral entry recruitment:
1. Sourcing

15
 2. Interview
a. Written test
b. Technical round interview
c. Personal Interview
TRAINING

Training is an on-going process aimed at capability-building of the employees at

all levels. Training programme is classified into
• Skills
• Knowledge
• Behaviour

WORKMEN CAPABILITY BUILDING

Training & Development for the unionized employees at the manufacturing units
is focused on skill development. Both internal and external training is given for
associates. Guest lectures of external faculty and various other industrial visits will
be arranged for associates. In addition to some programmes like engineering
drawing and waste elimination are also conducted.

TRAINING FOR SENIOR/ MIDDLE LEVEL MANAGEMENT

Both external and internal training is given for the executives. Faculty from
outside agencies will be arranged for training them. They also get faculty from

16
corporate level. Training for senior/middle level management is done on the
following basis:

1. Technical
2. Behavioral
3. Functional
DEVELOPMENT ACTIVITIES

The following are the developmental activities:

 TEI – Total Employee Involvement

 CFG – Cross Functional Group
 QC – Quality Control
 SS – Suggestion Scheme

EMPLOYEE RETENTION/INCENTIVES

Performance linked pay

The company has an annual appraisal system in place and pursuant to this system,
performance linked pay, annual variable pay and/or commission is paid to the
employees.

HR Initiatives
There is a HR initiative called “SEED”. In this, employees are welcomed to
provide suggestions to improve quality, performance, cost reduction, etc., If their
suggestions are feasible, they are accepted and the others are rejected. A cash
award, awards such as
RESI, GEMBA passport is given to them as a token of appreciation. This
motivates people to contribute their ideas.

17
Employee welfare schemes

The following are the welfare schemes available to the employees.

 Canteen facilities
 Medical claims
 Transport facilities
 Ashok leyland school for their children
 Scholarship schemes
 Recreation facilities

PERFORMANCE APPRAISAL
‘Performance appraisal is an objective assessment of an individual’s performance
against well defined benchmarks’. The performance appraisal method followed is
based on the Superior – subordinate relationship, whereby the superiors rate their
subordinates. They are rated on the basis of their performance.

CORPORATE SOCIAL RESPONSIBILITY

 Donations
 Career guidance
 AIDS awareness

18
  Guest lectures for school and college students

PROMOTIONS
Promotions are given once in three years wherein there is elevation from one level
to the other. They give promotions based on the 3x3 matrix.

A3 A2 A1
B3 B2 B1
C3 C2 CI

Performance

SEPERATIONS
When people leave the organization, Exit interviews are usually conducted to
know the reasons for leaving. The common reasons given are

• Better opportunities
• Financial problems
• Lack of growth
• Job clarity

ATTRITION
Attrition rate is noted to be 5.6% till December 2008.

19
PURCHASE & MATERIAL PLANNING

For a manufacturing company to produce end items to meet demand the

availablility of sufficient production capacity must be co-ordinated with the
availability of raw materials and purchased items from which the end items are to
be produced.the following are the system which are followed to procure materials:
-JIT
-LCL
-MRP
-VMS
-KANBAN

JIT
It is an approach than seeks to eliminate all source of waste in production
activities by providing the right part at the right place at right time .JIT encompasis
the successful execution of all manufacturing activity required to produce a final
product from design to delivery and including all stages of conversion from raw
materials onwards.

PURPOSE OF JIT

• -have only the required inventory need

• -improve quality to zero defect
• -to reduce lead time

20
 • -to incrementally revise the operations themselves and to accomplish these
things at minimum cost.

LOW COST LOGISTICS (LCL)

LCL Includes materials such as bolts nuts etc. these are purchased in bulk and
they are used for production. they don’t affect the inventory cost.

MATERIAL REQUIREMENT PLANNING

Material is a technique for determining the quantity and timing for the
acquisition of dependent items needed to satisfy master schedule requirements

An alternative approach to managing dependent demand items is planned for

Procurement or manufacture of the specific components that will be required to
produce the required quantities of end production schedule indicated by the master
production schedule.

BILL OF MATEIALS
The parts /components requirements of the final product which is to be
manufactured is usually presented in the form of a product structure/bill of
materials. it is a listing of all components that go into an assembled item. It
frequently includes the part number and quantity required per assembly.

KANBAN
The kanban system is a signal proofing. the firm stores their materials and other
inventory item in a signal use contains that holds a specific amounts of material or

21
 other inventory part that are used to manufacture the product. when the material in
a container is depleted, a KANBAN that defines requirements of inventory items
to continue the production process is kept in the container.

PRODUCTION

Departmental Structure

DEPUTY GENERAL
MANAGER

ASST. GENERAL ASST. GENERAL DIVISIONAL

MANAGER- MANAGER- MANAGER- SHOP-I
ASSEMBLY MACHINE SHOP-V

Sr. MANAGER Sr. MANAGER Sr. MANAGER Sr. MANAGER

CYLINDER BLOCK CONNECTING

& CYLINDER HEAD ROD, CAMP SHOP
& GEARS

ASST. ASST.
MANAGER MANAGER

22
 EXECUTIVES EXECUTIVES

EMPLOYEES EMPLOYEES

MACHINE SHOP I

COMPONENTS MACHINED:

• Cylinder block machining (AL-680 Engine)

• block machining (H-series Engine)
• Rocker level (Rocker arm actuating device)
• Cylinder H-series camshaft machining
• H-series connecting rod machining
• H-series timing gear case machining
• H-series flywheel housing machining.

MACHINE SHOP-V

COMPONENTS MACHINED:

BEARING CAP FOR H-SERIES:

Operations done:

23
  Rough milling
 drilling
 arrow milling
 finish milling
 washing
 boring
 tapping
 end milling
 brushing of holes
 assembly of bearing caps
 injection flood washing
 leak test water ways
 counter boring,reaming

ENGINE ASSEMBLY II & V

FIXING OF CRANKSHAFT AND BEARING CAPS:

CRANKSHAFT is attached with a gear and is fixed to the bottom of the

cylinder block by bearing caps.

FIXING OF CAMSHAFT
CAMSHAFT is attached with a timing gear and is fixed in the
required space provided in the cylinder block

24
 • Fixing of flywheel housing
• Assembly of oil sump
• Fitting of oil stainer
• Fixing of fuel injection pump
• Fixing of connecting rod and piston
• Assembly of inlet manifold
• Fixing if started motor
• Fixing of connecting rod with crankshaft
• Fixing of timing gear case
• Compressor fitting
• Fitting of cylinder head and rocker arm assembly
• Fitting of cylinder head cover
• Fitting of oil coolant
• Assembling of turbocharger or air fitter
• Fitting of atternator, fitting of belt.

MEDIUM DUTY VEHICLE(MDV)

CATEGORY:

Vehicles which transport load in the range of 16 to 35 tonnes

PRODUCTION IN MDV ASSEMBLY(H1 PLANT):44/day ,22/shift

STAGES OF ASSEMBLY :

25
Frame Assembly: 5stages
Chassis Assembly: 13 stages

FRAME ASSEMBLY:
STAGE 1: Mounting of side members and cross members

STAGE 2: Mounting of Front Spring-rear, Front Spring-rear, Rear spring-front,

Rear spring-middle, Rear spring-rear.

STAGE 3: Fitting of Engine mounting brackets and FES mounting brackets

STAGE 4: Side members fastening to torque limit, Steering box bracket, Side
Members reaming, Front tie channel mounting

STAGE 5: Fitment of FES rear brackets, Shock absorber brackets and Torque
checking

PASSING STAGE: Checking and tilting

CHASSIS ASSEMBLY:
STAGE 6: Radiator mounting brackets, Air tank mounting , Air cleaner mounting
bracket, battery mounting bracket, grease nipple fitment, Bellcom lever mounting.

26
STAGE 7: DC valve mounting, Oil piping, Clutch oil piping, Quick release valve
mounting.

STAGE 8: Spring fitment, frame punching

STAGE 9: Silencer fitment, first axle mounting.

STAGE 10: Second axle mounting, slack adjustment

STAGE 11: Fuel piping, Air piping, Air filter mounting, Diesel filter mounting,
Steering box mounting

STAGE 12: Engine mounting, fuel tank mounting, Diesel filter mounting,
Steering box mounting

STAGE 13: Radiator fitment, Radiator supports tightening, Rear lamps

fitting,Turbocharger outlet pipe connection and Radiator hose connections

STAGE 14: Exhaust piping, Shock absorber fitment (front and rear), Battery
mounting and connection of circuits, battery casing fitment and second
propeller shaft mounting

STAGE 15: Tyre mounting, Maxcut checking

STAGE 16: FES mounting, Electric fitments (male-female connecting process)

STAGE 17: Bumper fitment, FES wiring, Universal joint (UJ) fitment with
steering handle, ABC fitment and connecting

STAGE 18: Greasing of joints, nuts, etc., Off track arrangements

27
FES DRESSING:

• Fitting of seats, ABC pedals, steering handle and instrument box

• Electrical wiring
• Flink Valve Fitting.

PDI (PRE DELIVERY INSPECTION):

Testing of vehicle on real road conditions

The following are the various tests done to test the vehicle:

1. Speed test
2. Acceleration test
3. Vibration test
4. Torque tightening
5. Oil level and water level checking
6. Electrical components checking
7. Air leakage test
8. Grease level checking
9. Power steering hose routing and clamping
10. Road test

QUALITY CONTROL

QUALITY:

28
 It is the degree to wish a set of inherent characteristics fulfills requirements. The
following are the various dimensions of quality.
• Performance
• Features
• Conformance
• Reliability
• Durability
• Service
• Response
• Aesthetics
• Reputation

TQM:

It is defined as both a philosophy and a set of guiding principles that represent the
foundation of a continuously improving organization. It is the application of
quantitative methods and human resources to improve all the processes with an
organization and exceed customer needs now and in the future.

QUALITY POLICY:

Ashok Leyland is committed to achieve customer satisfaction by anticipating and

delivering superior value to the customer in relation to their own business, through
the products and services offered by the company and comply with statutory
requirements.

29
 Towards this, the quality policy of Ashok Leyland is to make continual
improvements in the processes that constitute the quality management system, to
make them more robust and to enhance their effectiveness and efficiency in
achieving stated objectives leading to
1. Superior products manufactured as also services offered by the company.
2. Maximum use of employees potential to contribute to quality and
environment by progressive up gradation of their knowledge and skills as
appropriate to their functions.
3. Seamless involvement from suppliers and dealers in the mission of the
company to address customers changing needs and protection of the
environment.

OBJECTIVES OF QC DEPARTMENT:

1. Identity the quality level to meet drawing and specification requirements.

2. Establish necessary infrastructure and system to carryout quality planning,
control and improvement activities.
3. Exercise necessary controls at all stages to ensure total conformance of
product quality to design specifications.
4. Evaluate product quality in the light of performance and customer feedback
to review and update quality level, infrastructure and systems.

SYSTEM OF ACCEPTING PRODUCTS:

1. ZERO DEFECT SAMPLING PLAN:

30
 Here, the defect level should be zero, then accept the product. If there is one
defect also they will reject the product.

2.DOUBLE DEFECT SAMPLING PLAN:

Here, first one set of samples will be taken and if they find defect another
set of samples will be taken if it goes beyond the fixed level then reject or else
accept the products.

INSPECTION:
It is also to eliminate, substantially reduce or automate the inspection
activity. There are 4 phases of inspection.
• 100% inspection
• Sampling
• Audit
• Identity check

PURCHASED PRODUCTS VERIFICATION PROCESS

SUPPLIER
INPUT OUTPUT CUSTOMER ENG /
THROUGH
VEH / ASSY
PURCHASE
PURCHASED

*INTERNAL
* INWARD CUSTOMER
REJECTION FEEDBACK
*INTERNAL
CUSTOMER
CONCERN
*VENDOR
PERFORMANCE

31
RESPONSIBILITIES OF QC DEPARTMENT

The quality engineering dept is responsible for quality of all products of

Ashok Leyland, Hosur which is achieved by…
1. Ensuring the quality of bought out machine VIZ rough, semi-finished &
finished.
2. Exercising controls on the processes clearing, manufacturing and
assembling there by ensuring the quality of the house made items.
3. Ensuring the quality of the finished products prior to dispatch to the
customers.
4. To provide support to the vendors to meet the quality requirements and
also guidelines for continuous improving.

The departments is also responsible for

1. Planning and implementation of APQPCP & PPAP procedures to meet
TS16949 requirements.
2. Training in quality engineering and quality control technique to all dept of
Ashok Leyland, Hosur.
3. Monitoring quality level of “zero kilometer” failures and field performance
for improvements

BENCHMARKING:

Benchmarking is the systematic search for best practices, innovative ideas,

and highly effective operating procedures. Benchmarking considers the experience

32
of others and uses it. It promotes superior performance by providing an organized
framework through which organizations learn how the “ Best in class ” do things,
understand how these best practices differ from their own and implement change
to close the gap.

LEVELS OF BENCHMARKING:
1. Contempary level
2. High level.

PROCESS OF BENCHMARKING:
The following six steps are followed to benchmark
1. Decide what to benchmark
2. Understand current performance
3. Plan
4. Study others
5. Learn from the data
6. Use the findings.

CONTINOUS PROCESS IMPROVEMENT:

Quality based organizations should strive to achieve perfection by
continuously improving the business and production processes.

CUSTOMER RETENTION:
It represents the activities that produce the necessary customer satisfaction that
creates customer loyalty, which actually improves the bottom line. It moves

33
customer satisfaction to the next level by determining what is truly important to
the customers and making sure that the customer satisfaction system focuses
valuable resources things that really matter to the customer. It is the connection
between customer satisfaction and the bottom line.

WAYS TO RETAIN CUSTOMERS:

The following are the various ways followed here to retain their customers
1. Warranty expenditure measure
2. Dealers conference
3. Customer visits
4. Monthly plant quality review

FEEDBACK FROM CUSTOMERS:

Feedback is collected from the customers regarding quality through the

following ways.
• Customer visits
• Toll-free telephone number
• Comment card
• Report card

34
 PROBLEM SOLVING METHOD: -

IDENTIFY THE OPPURTUNITY

ANALYSE THE PROCESS

PLAN FOR THE FUTURE

ACT PLAN

DEVELOP THE OPTIMAL SOLUTION

STANDARDIZE THE SOLUTION
STUDY DO

STUDY THE RESULTS IMPLEMENT

35
 PLANT ENGINEERING

Plant engineering is responsible for proper functioning of the plant by carrying out
maintenance operations such as electrical and electronics equipments maintenance,
fork lift charging and its repairing, repairing of pneumatic circuits etc.. It is also
responsible for maintenance works carried out in the organisation. The following
are the various types of maintenance:

 Predictive maintenance
 Preventive maintenance
 Breakdown maintenance
 Routine maintenance

1. PREDICTIVE MAINTENANCE:
Predictive maintenance is done on assumption by experience before the
occurring or by any symptoms of occurring.

2. PREVENTIVE MAINTENANCE:

36
 Preventive maintenance is done before the accident occurs, they will take
actions to prevent them.

3. BREAKDOWN MAINTENANCE:
Breakdown maintenance is done after the accident occurs. Actions will be
taken only after the occurrence

4. ROUTINE MAINTENANCE:
Routine maintenance is done on even time or on routine basis. It is generally
carried out without affecting the productivity.

DIVISIONS:
Plant engineering is divided into 4 divisions to carry out its functions. The
following are divisions of plant engineering:

 Electrical
 Mechanical
 GWE(General Works Engineering)
 Civil

PERIOD OF MAINTENANCE:
Period of maintenance is done on the basis of VED analysis. It is also known as
time based maintenance. Here VED stands for
V - Vital
E - Essential
D – Desirable

37
 ANALYSIS DURATION
V- Vital 6 months
E- Essential 9 months
D- Desirable Once in a year

PEP: - PRODUCTION ENGINEERING & PROJECTS

PEP department works as a bridge between R & D and Manufacturing

Department. The R & D designs and if the testing is successfully achieved it is
transferred to PEP.

RESPONSIBILITIES OF PEP:

1. Deciding and releasings of MAKE OR BUY DECISION ADVICE

( MBDA) for new components.

If bought from supplier that may be;

BOR (Bought out Rough) – need further processing.
BOSF ( Bought out Semi Finished ) – need further prosessing.

BOF (Bough out Finish) – ready for assembly.

BOR & BOSF are chosen to maintain quality standards, core competency,
improve efficiency, and to enjoy cost benefits.
2. Laying down the Process and Selection of Machines.
3. Designing new tools for inhouse components

38
 4. Organising and Conducting assembly trials.
5. Continuous improvements towards quality and productivity
6. Analysis of processes and layouts
7. Progressing of new projects to bridge between R & D and manufacturing.

IED – Industrial Engineering Department.

This is closely related to PEP department. They work as a single wing.

RESPONSIBILITIES OF IED

1. Decide on capacity planning.

2. Manpower capacity & Requirement.
3. Machine capacity and running time
4. Operating time.
5. Frame performance index for incentive.
6. Frame the work instruction sheet, process sheet.
7. Processing FMEA for assembly vehicle

STORES AND LOGISTICS

There are Stores meant for both Vehicle assembly and Engine Assembly. Vehicle
part number and engine part number are framed for identification. 2 bin system are
practiced. Despatching of finished vehicle and semi finished engine are processed
every morning.

39
Goods Receipt Note (GRN) is the vital documents required for inspection. TVS
Logistics are the group who supply the internal components. All the dispatching
and supply schedules are accessed from ERP both by Company Logistics and TVS
Logistics.

As a cost beneficial measure for the Company and Supplier , the godowns of the
supplier are located nearby for easy delivery and enhances the efficiency of JIT.

FINANCE

FINANCE FUNCTIONS:
1) Investment decisions
2) Financing decisions
3) Dividend decisions
4) Liquidity functions

ROLE OF FINANCIAL MANAGER:

1) Funds raising
2) Funds allocation
3) Profit planning
4) Understanding capital markets

SHAREHOLDING:
The following are the shareholders of Ashok Leyland Ltd:

 51% owned by Hinduja group

 12% - 14% owned by public

40
  Remaining shares are owned by various financial institutions

DIVIDEND POLICY:

The Board may, at its discretion, recommend dividends to be paid to the

shareholders. Generally, the factors that may be considered by the Board of
Directors before making any recommendations for the dividend include, without
limitation, the future expansion Splans and capital requirements, profits earned
during the fiscal year, cost of raising funds from alternate sources ,liquidity
position, applicable taxes including tax on dividend, as well as exemptions under
tax laws available to various categories of investors from time to time and general
market conditions. The Board of Directors may also from time to time pay interim
dividends to the shareholders. Dividends, other than interim dividends, will be
declared at the annual general meeting of the shareholders based on the
recommendation of the Board of Directors.

BUDGET:
The funds which are required by the organisation are provided by the corporate
office, Chennai. These funds are allocated to the departments whenever there is
requirement.

41
 ALLOCATION OF FUNDS:
Funds are allocated for various purposes of the departments. They allocate funds
for day to day activities and also for various projects and also for special projects,

they also allocate for payroll.

PAYROLL:
They use the customized ERP to pay salary to the employees. Every month
on 10th salary is paid for the workers and on 28th salary is paid for the executives.
SYSTEMS

The systems department maintains and updates the software / data used in the unit.
The department also maintains the intra network and also does the system
maintenance. System is an orderly grouping of independent components linked
together according to a plan to achieve a specific objective. System is a
combination of resources working together to convert the input to useful output.
The total arrangement of the required entities takes place in this department.

Ashok Leyland Network Connectivity

Supplier

Internet
Hosur- Unit II
Hosur- unit I
ENNORE Corporate Bhandara

42
 AL - AU
ALWAR MKTG DCU

ASHOK LEYLAND ERP- FAMILY MEMBERS:

• ALMAP- Manufacturing
• ALMARK- Marketing
• ALFIN- Finance
• ALPAY- Payroll
• ALPMS- Plant maintenance
• ALEMS- Environmental management
• ALHR- Human resources
• ALCORP- Corporate functions
• ALSCM – Supply Chain Management
• ALPD – Product Development
• ALNPRD – Non Production
• ALIMS – Information Management Systems.

43
HARDWARE TECHNOLOGIES USED IN SYSTEMS:

# DATABASE SERVERS – (3nos)

* HP-R*8640 Itanium Processor (1.3 GHz)
* 16 Processors each
* 64 GB RAM (total 192 GB)

#APPLICATION SERVER (5nos): -

--Compaq Alpha Server- model ES40
* Dual Processor
* 6 * 9.0 GB of OS
* 4GB RAM
# DATA STORAGE: -
* EVA 5000 Disk sub system
* 2 Controllers
* 7 TB
* RAID 0 + 1

SOFTWARE TECHNOLOGIES USED IN SYSTEMS:

# Oracle log
# Internet Application Server (IAS)
# Real Application Cluster (RAC)
# Application development with
*Oracle forms 6i

44
 * Oracle reports 6i

MODULES USED INSIDE THE COMPANY:

• ACL - Access Control Module

• BOM - Bill of Material
• MPL - Material Planning
• SDB - Supplier Database
• POS - Purchase Order System
• IPS - Inspection Planning Sheet
• INW - In warding
• JIT - Just In Time items
• LCL - Low Cost Logistics Items
• MRM - Sun Contractor Material Issues
• MTN - Sub Contractor Material Transfer
• VQR - Vendor Quality rating
• VDP - Vendor Delivery Performance
• STK - Stock / Inventory
• CPM - Comprehensive Process Master
• PPL - Production Planning
• SFC - Shop Floor Control
• UPJ - Unplanned Jobs
• URDC - Inter Units Receipt & Dispatch
• EXS - Excise
• PSL - Priced Stored Ledger

45
 • WMC - Works Made Items Costing
• VCS - Vehicle Costing System
• SCL - Sub Contract Ledger
• RMGP – Returnable Material Gate pass
• NRMGP – Non RMGP
• GCS – Gauge Calibration System
• CFS – Chassis Final Specification
• LTMS – Lean Tool Management System

GROWTH MILESTONES OF ASHOK LEYLAND

1966 – Full air brakes introduced

1967 – Double Decker buses introduced.
1968 – Power steering offered.
1979 – Multilane trucks introduced.
1980 – Integral bus with air suspension.
1992 – Self-certification status for defence supplies.
1993 – ISO 9000 Certification.
1994 – ISO 9001 Certification
1997 – India’s first CNG powered bus.
1998 – QS 9000 Certification
1999 – CNG (Compressed Natural Gas) introduced.
2000 – Euro-I, Engines/vehicles introduced.
2001 – ISO 14000 Environment Management System Certification.

46
2002 – Exclusive Machine line – 2 for Hino cylinder.
2003 – E-Comet launched.
2004 – 50,000 mark vehicle produced.

PRODUCT PROFILE

Ashok Leyland offers a comprehensive product range with trucks from 7.5 tons
GVW to 125 tons GVW. From 19 to 80 seaters a host of special application
vehicles and diesel engines from industrial gensets and marine application.

Product profile can be broadly split into six categories viz. passenger, goods,
cargo, heavies, special Vehicles and Engines.

PASSENGER
ICV Viking MOV
Cheetah Viking Hino Viking AL
Rear Engine Bus Vestibule Bus Panther
Cruiser CNG Bus Viking
Super Double Decker

GOODS
Haulage Comet Bison
Tipper Taurus 6X4 Tractor
Comet 2614 Tusker 3516 Multi Axle Tusker
CARGO
LCV Haulage Cargo 909
Cargo 1614 Tipper

47
HEAVIES
Haulage Tractor Beaver
Dumper

SPECIAL VEHICLES
Defence LRV Fire Fighter
RIV 4 x 4

ENGINES
Industrial Marine

RESEARCH AND DEVELOPMENT

World-class Technology :
To offer world-class technology that is relevant and affordable to the Indian
customer is the philosophy that drives R&D at Ashok Leyland. Over the years, this
philosophy has been translated time and again into products that seamlessly
integrate international technology with local needs. "The role of R&D is central in
fulfilling the company-wide commitment to total customer satisfaction" states Mr.
R. Seshasayee, Managing Director, and adds that the increased infrastructural and
financial support expresses the company's determination to become self-reliant in
R&D.

Value to the Customer

The immediate R&D priorities are to pro-actively address safety and
environmental issues, harness and adopt technologies that provide value to the
customer in an atmosphere enabling creativity and innovation. Powering those

48
who "engineer tomorrows" with an enabling infrastructure has been top priority
for the company.

Test Tracks
But our R&D is not confined within walls. It extends to the test tracks as well.
Rigorous tests are carried out under stringent simulated conditions that replicate
the most treacherous landscapes.

Vehicle ruggedness and longevity are a prime customer concern, as they directly
impact earnings. Ever conscious of this, Ashok Leyland makes extensive use of a
modern CAD set-up, a comprehensive test track facility (where cobble-stones are
calibrated and reset periodically), accelerated fatigue testing rigs and rigorous
durability testing facilities. Together they ensure that there is a constant
improvement in the life and on-road performance of every make of Ashok Leyland
vehicle to hit the roads. Safety, durability, through our R&D efforts.

Innovations
Ashok Leyland product development successes have come from a keen sense of
anticipation and attentiveness. The company initiated research into alternative
fuels well before legislative debate had even begun in the country. The result was
the implementation of CNG technology ahead of the rest promising a breath of
fresh air for polluted cities.

People
We are close to 12,000 people, moulding and managing technology. And reaching
the benefits of technology to our customers. Offering transport solutions and after-
market support wherever our products operate - which is almost everywhere.

49
We are spread throughout India, and even outside India. Our tasks vary, so do our
skills. But we are bound together by a healthy chain of interdependence, to deliver
value to the customers.

ENVIRONMENT POLICY

Ashok Leyland is committed to preserve the environment through a

comprehensive environmental policy and a proactive approach in planning and
executing the manufacturing and service activities. The objective of Ashok
Leynand’s environmental policy is to adhere to all applicable environmental
legislations and regulations, adopt pollution preventive techniques in design and
manufacture, conserve all resources such as power, water etc, and optimize its
usage, through scientific means, minimuse waste generation by all possible ways
and Reduce, Reuse and Recycle the same through time bound action plan as well
as provide a clean working environment to employees, contractors and neighbours.

Ashok Leyland has proactively developed its engines to meet the progressive
emission norms, including the Bharat Shage II norms. The Ennore unit was
recently identified as one of the model energy – efficient units by a CII-TNEB
organized energy conservation (ENCON) mission.

From August 1999 “ green energy” has been powering the Hosur Plants. Even
cooking is eco-friendly here. The canteen runs on Solar Heaters and food waste
becomes fodder to cattle at a cattle farm at Mathagiri near Hosur.

To the best out of Ashok Leyland’s eco-friendly engine technology, round the year
awareness and action programmes are held at Operators’ meets and service
campaigns. Ashok Leyland has also launched a dedicated mobile emission clinic

50
operating on highways and at entry points to New Delhi. On an average 250,000
liters of recycled water is pumped into the garden saving Rs. 1.5 million per
annum.

OBSERVATIONS AND INTERPRETATIONS.

SWOT ANALYSIS
STRENGH OF THE COMPANY
1. Good Training System.
2. Good Organisational Climate.
3. High Market Share
4. Skilled Employees
5. Strong Functional Structure
6. Standard Quality Product

WEAKNESS OF THE COMPANY

1. Low margin
2. High price
3. Sales representatives are less
4. There is no proper mechanism to handle the grievance of the customers

OPPORTUNITIES FOR THE COMPANY

1. Due to liberalization, demand for heavy vehicle have steeped up all
over the globe.
2. National market through good advertisement.
3. Company provides better credit facility to dealers.
4. Company introduces promotional programmes

51
THREATS FACED BY THE COMPANY
1. High competion
2. Liberal credit policy of other brand
3. Promotional programmes of other brand
4. Complicated national market
5. Good replacement facility if other brands.

FINDINGS

1. In this organisation there is no flexible manufacturing system.

2. There is no effective utilization of Human Resources.
3. To solve their work related problems QCC (Quality Control Circle) and
cross functional team are made effective. Work instructions, standard
operating procedures, inspection reports, QC charts are effective..
4. In this organisation there is no flexible manufacturing system.
5. There is no effective utilization of Human Resources.
6. To solve their work related problems QCC (Quality Control Circle) and
cross functional team are made effective.
7. Work instructions, standard operating procedures, inspection reports,
quality control charts are effectively utilised by the employees.

SUGGESTIONS

52
 • The company should earmark more money for the advertisement and sales
promotion of its products. It helps to increase the brand awareness and
image.

• The company should concentrate on markets in the international arena

where its competitors are less powerful.

• Complaints should be rectified in the shortest possible time. For this a

customer satisfaction cell should be organized.

CONCLUSION

Ashok Leyland is a well known automobile manufacturing company in India.In

Unit I, Hosur, there is a well planned organisation structure being followed. There
is a well integration of all the functional departments which facilitates the use of
software like ERP. Retention of the talented people is essential as they contribute a
lot to success of the organisation.

The catalogued training programme and the resulted report have been of great help
to me, an aspirant manager, to understand the functioning of a major establishment
like Ashok Leyland. The training programme has also revealed many unknown
facts about the working of a manufacturing unit.

53
BIBILIOGRAPHY

Human Resource Management – Ashley News.

Financial Management – I.M. Pandey
Total Quality Management – Bestersiek

Web Bibiliography – www.ashokleyland.com

54