11/16/2016

Hi

IIIE friends,

Read it carefully before going to use this study

material.

This solved question paper notes prepared with the

help of friends, text book, reference books and
Internet search.

We tried our best to match the related questions,

answers but you may find some of the answers are
not exactly proven the question but it's related to
its philosophy and urge you to understand its way
of explanation, so it can give you better view and
understanding.

We would like to thank you for your kind support

and wish you very all the best to get success in
your career.

You’re sincerely

Hemendra and Special Thanks to Dharmend

Follows us on Facebook !

IIIE STUDENTS STUDY CORNER (SSC)

1|Page
Notes by HBS
 IEB 01 Facilities Planning and Management (Feb 2016)

Q.1. a) Explain the different factors influencing the selection of plant

location.

Ans:- Location, localization and planned location of industries are often felt
to be synonymous. But, the distinction among these three terms is of
immense importance. Entrepreneurs locate their enterprises where the cost
of production comes, the lowest at the time of establishing industries. This
is known as ‘location of industries’.

The concentration of a particular industry mainly in one area, as occurred

with many industries in India, for example, textile industry in Mumbai is
known as ‘localisation of industries’. ‘Planned location of industries’ is a
term whereby the location of industries is planned to give each industrial
area a variety of industries so that large industries are dispersed and not
localised.

The early theories of industrial location carried out the analysis on a simple
framework where the locational and special diversification was simply
determined by an adjustment between location and weight distance
characteristics of inputs and outputs.

The reason is that the then industrial structure was heavily dominated by
the natural resource-base and consumer-oriented industries. But, over the
period the very consideration for locating industries in a particular region
has undergone a considerable change so the early theories of industrial
location have become improper to explain location. Consideration of natural
resources in the choice of industrial location has declined and the

2|Page
Notes by HBS
industries are likely to be established even in those areas with poor natural
endowment.

This holds especially true in the case of industries which are not heavily
biased in favour of raw material source for their location. It is seen that
such industries are gaining increasingly greater importance in the industrial
map of India during the recent decades. Concentration of IT industries in
Bangalore and Hyderabad are such examples.

It is not always possible to explain industrial location independently with the

help of any one factor. In fact, several factors/ considerations influence the
entrepreneur’s decision in selecting the location for industry. Selection of
industrial location is a strategic decision. It is a onetime decision and not be
retracted again and again without bearing heavy costs.

Nonetheless, regardless of the type of business/enterprise, there are

host of factors but not confined to the following only that influence
the selection of the location of an enterprise:
(i) Availability of Raw Materials

(ii) Proximity to Market

(iii) Infrastructural Facilities

(iv) Government Policy

(v) Availability of Manpower

(vi) Local Laws, Regulations and Taxation

(vii) Ecological and Environmental Factors

(viii) Competition

3|Page
Notes by HBS
(ix) Incentives, Land costs. Subsidies for Backward Areas

(x) Climatic Conditions

(xi) Political conditions.

Let us discuss these in some details.

(i) Availability of Raw Materials:

One of the most important considerations involved in selection of industrial
location has been the availability of raw materials required. The biggest
advantage of availability of raw material at the location of industry is that it
involves less cost in terms of ‘transportation cost.

If the raw materials are perishable and to be consumed as such, then the
industries always tend to locate nearer to raw material source. Steel and
cement industries can be such examples. In the case of small- scale
industries, these could be food and fruit processing, meat and fish canning,
jams, juices and ketchups, etc.

(ii) Proximity to Market:

If the proof of pudding lies in eating, the proof of production lies in
consumption. Production has no value without consumption. Consumption
involves market that is, selling goods and products to the consumers. Thus,
an industry cannot be thought of without market.

Therefore, while considering the market an entrepreneur has not only to

assess the existing segment and the region but also the potential growth,
newer regions and the location of competitors. For example, if one’s
products are fragile and susceptible to spoilage, then the proximity to
market condition assumes added importance in selecting the location of the
enterprise.

4|Page
Notes by HBS
Similarly if the transportation costs add substantially to one’s product costs,
then also a location close to the market becomes all the more essential. If
the market is widely scattered over a vast territory, then entrepreneur
needs to find out a central location that provides the lowest distribution
cost. In case of goods for export, availability of processing facilities gains
importance in deciding the location of one’s industry. Export Promotion
Zones (EPZ) are such examples.

(iii) Infrastructural Facilities:

Of course, the degree of dependency upon infrastructural facilities may
vary from industry to industry, yet there is no denying of the fact that
availability of infrastructural facilities plays a deciding role in the location
selection of an industry. The infrastructural facilities include power,
transport and communication, water, banking, etc.

Yes, depending upon the types of industry these could assume

disproportionate priorities. Power situation should be studied with reference
to its reliability, adequacy, rates (concessional, if any), own requirements,
subsidy for standby arrangements etc. If power contributes substantially to
your inputs costs and it is difficult to break even partly using your own
standby source, entrepreneur may essentially have to locate his/her
enterprise in lower surplus areas such as Maharashtra or Rajasthan.

Similarly adequate water supply at low cost may become a dominant

decisional factor in case of selection of industrial location for leather,
chemical, rayon, food processing, chemical and alike. Just to give you an
idea what gigantic proportions can water as a resource assumes. Note that
a tone of synthetic rubber requires 60 thousand gallons, a tone of
aluminum takes 3 lakhs gallons, and a tone of rayon consumes 2 lakh
gallons of water.

5|Page
Notes by HBS
Similarly, location of jute industry on river Hoogly presents an example
where transportation media becomes a dominant decisional factor for plant
location. Establishing sea food industry next to port of embarkation is yet
another example where transportation becomes the deciding criteria for
industrial location.

(iv) Government Policy:

In order to promote the balanced regional development, the Government
also offers several incentives, concessions, tax holidays for number of
years, cheaper power supply, factory shed, etc., to attract the
entrepreneurs to set up industries in less developed and backward areas.
Then, other factors being comparative, these factors become the most
significant in deciding the location of an industry.

(v) Availability of Manpower:

Availability of required manpower skilled in specific trades may be yet
another deciding factor for the location of skill- intensive industries. As
regards the availability of skilled labour, the existence of technical training
institutes in the area proves useful. Besides, an entrepreneur should also
study labour relations through turnover rates, absenteeism and liveliness of
trade unionism in the particular area.

Such information can be obtained from existing industries working in the

area. Whether the labour should be rural or urban; also assumes
significance in selecting the location for one’s industry. Similarly, the wage
rates prevalent in the area also have an important bearing on selection of
location decision.

While one can get cheaper labour in industrially backward areas, higher
cost of their training and fall in quality of production may not allow the
entrepreneur to employ the cheap manpower and, thus, establish his/her
enterprise in such areas.
6|Page
Notes by HBS
(vi) Local Laws, Regulations and Taxes:
Laws prohibit the setting up of polluting industries in prone areas
particularly which are environmentally sensitive. Air (Prevention and
Control of Pollution) Act, 1981 is a classical example of such laws
prohibiting putting up polluting industries in prone areas. Therefore, in order
to control industrial growth, laws are enforced to decongest some areas
while simultaneously encourage certain other areas.

For example, while taxation on a higher rate may discourage some

industries from setting up in an area, the same in terms of tax holidays for
some years may become the dominant decisional factor for establishing
some other industries in other areas. Taxation is a Centre as well as State
Subject. In some highly competitive consumer products, its high quantum
may turn out to be the negative factor while its relief may become the final
deciding factor for some other industry.

(vii) Ecological and Environmental Factors:

In case of certain industries, the ecological and environmental factors like
water and air pollution may turn out to be negative factor in deciding
enterprise location. For example, manufacturing plants apart from
producing solid waste can also pollute water and air. Moreover, stringent
waste disposal laws, in case of such industries, add to the manufacturing
cost to exorbitant limits.

In view of this, the industries which are likely to damage the ecology and
environment of an area will not be established in such areas. The
Government will not grant permission to the entrepreneurs to establish
such industries in such ecologically and environmentally sensitive areas.

(viii) Competition:
In case of some enterprises like retail stores where the revenue of a
particular site depends on the degree of competition from other

7|Page
Notes by HBS
competitors’ location nearby plays a crucial role in selecting the location of
an enterprise. The areas where there is more competition among
industries, the new units will not be established in these areas. On the
other hand, the areas where there is either no or very less competition, new
enterprises will tend to be established in such areas.

(ix) Incentives, Land Costs, Subsidies for Backward Areas:

With an objective to foster balanced economic development in the country,
the Government decentralizes industries to less developed and backward
areas in the country. This is because the progress made in islands only
cannot sustain for long. The reason is not difficult to seek.

“Poverty anywhere is dangerous for prosperity everywhere.” That many

have-not’s will not tolerate a few haves is evidently clear from ongoing
protests leading to problems like terrorism. Therefore, the Government
offers several incentives, concessions, tax holidays, cheaper lands,
assured and cheaper power supply, price concessions for departmental
(state) purchases, etc. to make the backward areas also conducive for
setting up industries.

It is seen that good number of entrepreneurs considers these facilities as

decisive factor to establish industries in these locations. However, it has
also been observed that these facilities can attract entrepreneurs to
establish industries in backward areas provided other required facilities do
also exist there.

For example, incentives and concessions cannot duly compensate for lack
of infrastructural facilities like communication and transportation facilities.
This is precisely one of the major reasons why people in-spite of so many
incentives and concessions on offer by the Government, are not coming
forward to establish industries in some backward areas.

8|Page
Notes by HBS
(x) Climatic Conditions:
Climatic conditions vary from place to place in any country including India.
And, climatic conditions affect both people and manufacturing activity. It
affects human efficiency and behaviour to a great extent. Wild and cold
climate is conducive to higher productivity. Likewise, certain industries
require specific type of climatic conditions to produce their goods. For
example, jute and textiles manufacturing industries require high humidity.

As such, these can be established in Kashmir experiencing humidity-less

climate. On the other hand, industrial units manufacturing precision goods
like watches require cold climate and hence, will be established in the
locations having cold climate like Kashmir and Himachal Pradesh.

(xi) Political Conditions:

Political stability is essential for industrial growth. That political stability
fosters industrial activity and political upheaval derails industrial initiates is
duly confirmed by political situations across the countries and regions
within the same country. The reason is not difficult to seek.

The political stability builds confidence and political instability causes lack
of confidence among the prospective and present entrepreneurs to venture
into industry which is filled with risks. Community attitudes such as the
“Sons of the Soil Feeling” also affect entrepreneurial spirits and may not be
viable in every case.

Besides, an entrepreneur will have also to look into the availability of

community services such as housing, schools and colleges, recreational
facilities and municipal services. Lack of these facilities makes people
hesitant and disinterested to move to such locations for work.

Very closer to political conditions is law and order situation prevalent in an

area also influences selection of industrial location. Hardly any

9|Page
Notes by HBS
entrepreneur will be interested to establish his / her industry in an area
trouble-torn by nexalites and terrorists like Jharkhand, Nagaland and
Jammu & Kashmir.

People will be interested to move to areas having no law and order problem
to establish their industries like Maharashtra and Gujarat. It is due to this
law and order problem the Nano car manufacturing unit shifted from
Nandigram in West Bengal to Gujarat.

There are many qualitative and quantitative techniques adopted to

interpolate the above factors to arrive at a logical decision. The simplest
and most commonly adopted is weight rating method illustrated in Figure
below.

Besides above factors, the location of certain industries also depends upon
the delivery of emergency services like fire, police, hospital, etc. (Buffa
1983).

It seems in the fitness of the context to present the real cases of locational
considerations of the entrepreneurs of small-scale industries in India.
Based on extensive research study, one researcher (Khanka 2010: 45-46)
has found the following most important considerations that entrepreneurs
consider for selecting the location of their enterprises.

10 | P a g e
Notes by HBS
It is revealed from Table 27.1 that ‘home land’ factor, i.e., to start the
industry at one’s native place has been reported as the most important
factor for locating industries in one’s own native area. Availability of market
and ‘infrastructural facilities’ ranked the second and third most important
considerations.

However, the ‘Government incentives’ could not figure significantly in

determining the location of industry. This can be explicated on two grounds.
One, the heavy preference accorded to the home land factor in the location
of industries suggests that enterprise is not a freely mobile factor, willing to
move to any place for only marginal advantage.

11 | P a g e
Notes by HBS
Two, possibly more important, the accumulation of capital may be a
necessary but not sufficient condition for establishing an enterprise.
Because, fiscal concessions and financial assistance on soft terms cannot
adequately, compensate for the lack of infrastructure like transport and
marketing services.

Therefore, concessions and assistance would find it difficult to attract

industries to remote, inaccessible and highly backward areas. On the
whole, the major apprehension accorded to the home land factor in the hills
in contrast to the infrastructural and market facilities in the plains indicate
that the location considerations undergo change with differences in the
levels of development across the regions.

Q.1. b) Discuss the different types of plant layout in details.

Ans:- The following are the popular types of plant layout:

(1) Process layout (2) Product layout (3) Combined layout (4) Static
product layout or Project layout (5) Cellular layout (6) Job Shop
layout. Each layout is explained in brief in the following paragraphs:

Process layout: It is also called functional layout. All machines

performing similar type of operations are grouped at one location in
the process layout e.g. all lathes, milling machines, cutting
machines etc in the engineering shop will be clustered in their like
groups. Thus all forging will be done in one area and all the lathes
will be placed in another area. In this layout, several products may
share a machine to make its full use. The sequential arrangement
of the machine group is generally, but not necessarily made on the
basis of labor operations. In this type of layout the process rather
than the product has a dominating role. The product is given
secondary consideration and is moved for the purpose of
operations to the process section with like machines stationed at a
particular point. This type of process is more suitable to job order
type of production. In such production the operation differs from
product to product. So, it is desirable to arrange the machines on
the basis of process rather than on the products.
12 | P a g e
Notes by HBS
The typical arrangement of the machines in the process layout will
be as under:
Product ‘A’ and Product ‘B’ with their differential sequence will be
routed for the processing in the manner.
Advantages: The process layout avails of the following advantages:
1) Like product layout it eliminates the duplication of machines an
enables the optimum use of installed capacity.
2) It facilitates the flexibility in production. It is more flexible than a
line layout. Different products can be made without the changes in
the arrangement of machine. The production capacity is not
arranged in rigid sequence and fixed rated capacity with line
balancing.
3) Like product layout, the break down of one machine does not
interrupt the entire production flow.
4) Specialization in supervision becomes possible.
5) Individual incentive schemes can be developed.
Disadvantages: The following are the main disadvantages of the
process layout:
1) Due to lack of straight line sequence of production, it is
impossible to maintain the line balancing in production. So the
problems of bottleneck and waiting and idle capacity arise.
2) The cost of material handling increases due to long routing and
back tracking between the processes.
3) The processing time is prolonged which reduces the inventory
turnover and increase the investments in inventories.
4) The inspection cost increases. Due to frequent changes in the
machine set-up inspection is required at each stage of the process.
5) The cost of supervision increase due to specialist supervisors
and more number of supervisors are required at each process unit.
6) The production planning and control becomes difficult due to
complexities arising in routing, scheduling, dispatching and follow
up.
7) It is not possible to implement the group inventive schemes on
the basis of quantity of the products manufacturing
8) More space is required for internal storing, reservoir of materials
and provision for the expansion of the particular process section.

Product layout:
In this type of layout, the machines are arranged in the sequence as
required by the particular product. All machines as required to
balance the particular product the product line layout. In this layout,

13 | P a g e
Notes by HBS
one product goes through all the machines lined up, in the order
required by its manufacture. The best known example of this type of
layout is seen in motor car production. To make this layout
successful, the work load on the various machines must be
balanced. The process of getting even loading at each stage of
production is called line balancing.
In this type of layout, the product is dominating over the process, in
the sense that the product is given the primary importance and the
process machine must remain present at a point where the product
needs its services. Thus, unlike the process layout, the process is
given secondary importance in relation to the product. Product
layout suitable for continuous flow production with few items of
production:
It does not require frequent changes in machine set up. The typical
arrangement of the machines in the product with the separate
independent product lines for the Product ‘A’ and Product ‘B’ will be
as shown.
Advantages: The product layout is advantageous as under:
1) Reduced material handling cost due to straight line production
flow.
2) Mechanization of material handling is possible due to handling
between fixed points.
3) Line balancing may eliminate bottlenecks an idle capacity.
4) Shorter operating cycle due to shorter and speedier movement of
materials.
5) Maximum utilization of machine and labor capacity through
developing proper balance between them.
6) Effective control over production with reduced supervision by
generalist supervisors. By reducing the manufacturing to simple
steps we can often use less skilled labor.
7) Effective quality control with reduced inspection points. It does
not require frequent changes in machine set-up.
8) Effective production planning and control. Unlike process layout,
the routing, scheduling, dispatching and follow up are relatively
easier.
9) Maximum use of space due to straight production flow and
reduced need of interim storing.
10) It facilitates the implementation of the group inventive schemes
for the workers.
11) It is relatively easy to control

14 | P a g e
Notes by HBS
 OR
Keeping in view the type of industry and volume of production, the
type of layout to be selected is to be decided from the following:
1. Product or Line Layout

2. Process or Functional Layout.

3. Fixed Position Layout.

4. Combination type of Layout.

1. Product or Line Layout:

If all the processing equipment and machines are arranged according to
the sequence of operations of the product, the layout is called product type
of layout. In this type of layout, only one product of one type of products is
produced in an operating area. This product must be standardized and
produced in large quantities in order to justify the product layout.

The raw material is supplied at one end of the line and goes from one
operation to the next quite rapidly with a minimum work in process, storage
and material handling. Fig. 8.3 shows product layout for two types of
products A and B.

Advantages offered by Product Layout:

15 | P a g e
Notes by HBS
(i) Lowers total material handling cost.

(ii) There is less work in processes.

(iii) Better utilization of men and machines,

(iv) Less floor area is occupied by material in transit and for temporary
storages.

(v) Greater simplicity of production control.

(vi) Total production time is also minimized.

Limitations of Product Layout:

(i) No flexibility which is generally required is obtained in this layout.

(ii) The manufacturing cost increases with a fall in volume of production.

(iii) If one or two lines are running light, there is a considerable machine
idleness.

(iv) A single machine break down may shut down the whole production line.

(v) Specialized and strict supervision is essential.

2. Process or Functional Layout:

The process layout is particularly useful where low volume of production is
needed. If the products are not standardized, the process layout is more
low desirable, because it has creator process flexibility than other. In this
type of layout, the machines and not arranged according to the sequence
of operations but are arranged according to the nature or type of the
operations. This layout is commonly suitable for non repetitive jobs.

Same type of operation facilities are grouped together such as lathes will
be placed at one place, all the drill machines are at another place and so

16 | P a g e
Notes by HBS
on. See Fig. 8.4 for process layout. Therefore, the process carried out in
that area is according to the machine available in that area.

Advantages of Process Layout:

(i) There will be less duplication of machines. Thus, total investment in
equipment purchase will be reduced.

(ii) It offers better and more efficient supervision through specialization at

various levels.

(iii) There is a greater flexibility in equipment and man power thus load
distribution is easily controlled.

(iv) Better utilization of equipment available is possible.

(v) Break down of equipment can be easily handled by transferring work to

another machine/work station.

(vi) There will be better control of complicated or precision processes,

especially where much inspection is required.

Limitations of Process Layout:

(i) There are long material flow lines and hence the expensive handling is
required.

(ii) Total production cycle time is more owing to long distances and waiting
at various points.

17 | P a g e
Notes by HBS
(iii) Since more work is in queue and waiting for further operation hence
bottle necks occur.

(iv) Generally, more floor area is required.

(v) Since work does not flow through definite lines, counting and scheduling
is more tedious.

(vi) Specialization creates monotony and there will be difficult for the laid
workers to find job in other industries.

3. Fixed Position Layout:

This type of layout is the least important for today’s manufacturing
industries. In this type of layout the major component remain in a fixed
location, other materials, parts, tools, machinery, man power and other
supporting equipment’s are brought to this location.

The major component or body of the product remain in a fixed position

because it is too heavy or too big and as such it is economical and
convenient to bring the necessary tools and equipment’s to work place
along with the man power. This type of layout is used in the manufacture of
boilers, hydraulic and steam turbines and ships etc.

Advantages Offered by Fixed Position Layout:

(i) Material movement is reduced

(ii) Capital investment is minimized.

(iii) The task is usually done by gang of operators, hence continuity of

operations is ensured

(iv) Production centers are independent of each other. Hence, effective

planning and loading can be made. Thus total production cost will be
reduced.
18 | P a g e
Notes by HBS
 (v) It offers greater flexibility and allows change in product design, product
mix and production volume.

Limitations of Fixed Position Layout:

(i) Highly skilled man power is required.

(ii) Movement of machines equipment’s to production centre may be time

consuming.

(iii) Complicated fixtures may be required for positioning of jobs and tools.
This may increase the cost of production.

4. Combination Type of Layout:

Now a days in pure state any one form of layouts discussed above is rarely
found. Therefore, generally the layouts used in industries are the
compromise of the above mentioned layouts. Every layout has got certain
advantages and limitations. Therefore, industries would to like use any type
of layout as such.

Flexibility is a very important factory, so layout should be such which can

be molded according to the requirements of industry, without much
investment. If the good features of all types of layouts are connected, a
compromise solution can be obtained which will be more economical and
flexible.

Q.2. a) State and explain environmental aspects for good plant layout.

Ans:- General principles

Plant layout is often a compromise between a number of factors such as:

• The need to keep distances for transfer of materials between plant/storage units to a minimum to reduce costs
and risks;
• The geographical limitations of the site;
• Interaction with existing or planned facilities on site such as existing roadways, drainage and utilities
routings;
• Interaction with other plants on site;

19 | P a g e
Notes by HBS
• The need for plant operability and maintainability;
• The need to locate hazardous materials facilities as far as possible from site boundaries and people living in
the local neighbourhood;
• The need to prevent confinement where release of flammable substances may occur;
• The need to provide access for emergency services;
• The need to provide emergency escape routes for on-site personnel;
• The need to provide acceptable working conditions for operators.
The most important factors of plant layout as far as safety aspects are concerned are those to:

• Prevent, limit and/or mitigate escalation of adjacent events (domino);

• Ensure safety within on-site occupied buildings;
• Control access of unauthorised personnel;
• Facilitate access for emergency services.
In determining plant layout designers should consider the factors in outlined in the following sections.

Inherent safety
The major principle in Inherent Safety is to remove the hazard altogether. The best method to achieve
this is to reduce the inventory of hazardous substances such that a major hazard is no longer
presented. However, this is not often readily achievable and by definition no COMAH facility will have
done so. Other possible methods to achieve an Inherently Safer design are:

• Intensification to reduce inventories;

• Substitution of hazardous substances by less hazardous alternatives;
• Attenuation to reduce hazardous process conditions i.e. temperature, pressure;
• Simpler systems/processes to reduce potential loss of containment or possibility of errors causing a
hazardous event;
• Fail-safe design e.g. valve position on failure.
Plant layout considerations to achieve Inherent Safety are mainly those concerned with domino
effects (see below).

The Dow / Mond Indices

These hazard indices are useful for evaluating processes or projects, ranking them against existing
facilities, and assigning incident classifications. They provides a comparative measure of the overall
risk of fire and explosion of a process, and are useful tools in the plant layout development stage
since they enable objective spacing distances to be taken into account at all stages.

The methodology for undertaking a rapid ranking method that is based on the Dow / Mond index is
detailed in ILO, PIACT, Major Hazard Control: A practical manual, 1988.

Although these are useful rule-of thumb methodologies for first consideration of plant layout, they do
not replace risk assessment. The distances derived between plant units using these systems are
based upon engineering judgement and some degree of experience rather than any detailed analysis.

20 | P a g e
Notes by HBS
 Domino effects
Hazard assessment of site layout is critical to ensure consequences of loss of containment and
chances of escalation are minimised. Domino may be by fire, explosion (pressure wave and missiles)
or toxic gas cloud causing loss of control of operations in another location.

Fire
A fire can spread in four ways:

• Direct burning (including running liquid fires);

• Convection;
• Radiation;
• Conduction.
The spread of fire from its origin to other parts of the premises can be prevented by vertical and
horizontal compartmentation using fire-resisting walls and floors. Further information may be found
in BS 5908 : 1990. Consideration should also be given to the spread of flammable material via drains,
ducts and ventilation systems. Delayed ignition following a release may result in spread of flames
through such systems via dispersed flammable gases and vapours.
Protection against domino effects by convection, conduction and radiation can be achieved by
inherent safety principles i.e. ensuring that the distances between plant items are sufficient to prevent
overheating of adjacent plants compromising safety of those plants also. Where this is not possible
due to other restrictions, other methods such as fire walls, active or passive fire protection may be
considered.

Explosion
Explosion propagation may be directly by pressure waves or indirectly by missiles. As for fires,
inherently safe methods that should be considered are:

• arranging separation distances such that damage to adjacent plants will not occur even in the worst case;
• provision of barriers e.g. blast walls, location in strong buildings;
• protecting plant against damage e.g. provision of thicker walls on vessels;
• directing explosion relief vents away from vulnerable areas e.g. other plants or buildings, roadways near site
boundaries.
However, the latter may not provide practical solutions, particularly against missiles, and risk analysis
may be required to prove adequate safety.

Toxic gas releases

Toxic gas releases may cause domino effects by rendering adjacent plants inoperable and injuring
operators. Prevention/mitigation of such effects may be affected by provision of automatic control
systems using inherently safer principles and a suitable control room (see section below on Occupied
Buildings).

21 | P a g e
Notes by HBS
 Reduction of consequences of event on and off Site
In addition to the measures described in the sections above, Plant Layout design techniques
applicable to the reduction of the risks from release of flammable or toxic materials include:

• Locating all high-volume storage of flammable / toxic material well outside process areas;
• Locating hazardous plant away from main roadways through the site;
• Fitting remote-actuated isolation valves where high inventories of hazardous materials may be released into
vulnerable areas;
• Provision of ditches, dykes, embankments, sloping terrain to contain and control releases and limit the safety
and environmental effects;
• Siting of plants within buildings as secondary containment;
• Siting of plants in the open air to ensure rapid dispersion of minor releases of flammable gases and vapours
and thus prevent concentrations building up which may lead to flash fires and explosions;
• Hazardous area classification for flammable gases, vapours and dusts to designate areas where ignition
sources should be eliminated.
Risk management techniques should be used to identify control measures that can be adopted to
reduce the consequences of on or off site events. See references cited in further reading material.

Positioning of occupied buildings

The distance between occupied buildings and plant buildings will be governed by the need to reduce
the dangers of explosion, fire and toxicity. In particular, evacuation routes should not be blocked by
poor plant layout, and personnel with more general site responsibilities should usually be housed in
buildings sited in a non-hazard area near the main entrance. Consideration should be given to siting
of occupied buildings outside the main fence. In all cases occupied buildings should not be sited
downwind of hazardous plant areas. Further guidance is available in standard references.

Aggregation / trapping of flammable vapours

To avoid aggregation and trapping of flammable / toxic vapours which could lead to a hazardous
event, buildings should be designed so that all parts of the building are well ventilated by natural or
forced ventilation. Flammable storages should be sited in the open air so that minor leaks or thermal
outbreathing can be dissipated by natural ventilation. Maintenance procedures should include the
displacement of vapours from hazardous areas before work begins.

22 | P a g e
Notes by HBS
 Internal Assignment Questions for August 2016
Q. 1 b) Illustrate characteristic features of batch type of production with suitable
examples.

Ans:- Batch production pertains to repetitive production. It refers to the

production of goods, the quantity of which is known in advance. It is that
form of production where identical products are produced in batches on the
basis of demand of customers’ or of expected demand for products.

This method is generally similar to job production except the quantity of

production. Instead of making one single product as in case of job
production, a batch or group of products are produced at one time. It
should be remembered here that one batch of products may not resemble
with the next batch.

Under batch system of production the work is divided into operations and
one operation is done at a time. After completing the work on one operation
it is passed on to the second operation and so on till the product is
completed. Batch production can be explained with the help of an
illustration. An enterprise wants to manufacture 20 electric motors.

The work will be divided into different operations. The first operation on all
the motors will be completed in the first batch and then it will pass on to the
next operation. The second group of operators will complete the second
operation before the next and so on. Under job production the same
operators will manufacture full machine and not one operation only.

Batch production can fetch the benefits of repetitive production to a large

extent, if the batch is of a sufficient quantity. Thus batch production may be
defined as the manufacture of a product in small or large batches or lots by
series of operations, each operation being carried on the whole batch
before any subsequent operation is operated. This method is generally

23 | P a g e
Notes by HBS
adopted in case of biscuit and confectionery and motor manufacturing,
medicines, tinned food and hardware’s like nuts and bolts etc.

The batch production method possesses the following

characteristics:
1. The work is of repetitive nature.

2. There is a functional layout of various manufacturing processes.

3. One operation is carried out on whole batch and then is passed on to the
next operation and so on.

4. Same type of machines is arranged at one place.

5. It is generally chosen where trade is seasonal or there is a need to

produce great variety of goods.

Q.2. b) How will you use DCF technique in equipment replacement.

Ans:- Discounted Cash Flow is a valuation technique or model that discounts the future cash
flows of a business, entity, or asset for the purposes of determining its value.
One aspect of investment decision-making entails discovering the fair value of investments. The
DCF rests on the principle that an asset’s fair value is the present value of all its future cash
flows. Investors seek such value to

Determine a fair valuation for assets such as financial securities, business entities or
divisions, or any asset that produces future cash flows

Compare an asset’s estimated DCF value with its market price today

Decide whether to purchase an asset or dispose of an investment holding

Compare the values of various assets or financial securities
Uses and Roles of DCF
DCF is used in areas such as

Portfolio Management

Financial analysts use DCF to find the fair or fundamental value of financial securities
such as stocks and bonds

Using DCF estimates, analysts make stock buy or sell recommendations to their
clients

24 | P a g e
Notes by HBS

Portfolio managers use DCF results to decide on which financial securities to add or
remove from their portfolios

Typically, DCF analysis results in comparison between an asset’s DCF value and its
market price

If DCF value > market price = asset is undervalued

If DCF value < market price = asset is overvalued

If DCF = market price, asset is fairly valued
Advantages and Disadvantages
Advantages of DCF

Is a fundamentally sound valuation technique that can be used to determine fair or intrinsic
value

DCF can be used to assess the market’s gauge of a particular investment’s value.

DCF is particularly useful with companies that generate stable cash flows

Can be used with companies that have negative earnings

Disadvantages of DCF

It can be very hard to make accurate projections

DCF Values are also highly sensitive to its assumptions and estimates. Even minor
changes in estimates can cause large swings in value, which causes uncertainty to be
large

DCF is geared for long-term investing horizons, and might not suitable for short-term
investors.

In some cases, a long time horizon is needed, which makes the assumptions even more
uncertain
Conclusion
The Discounted Cash Flow model or technique is a method used to determine an asset’s fair or
intrinsic value. Its premise rests on the principle that an asset’s fundamental value is the sum of
the present values of its expected future cash flows. The present value of such cash flows is
found by discounting their future values using a discount rate. DCF is an important valuation tool
extensively used in portfolio management, investment banking, and corporate finance.

OR

Concept Of Equipment Replacement Decision

Some time choice to be made between retention or replacement of equipment. Basically,

replacement of machine or equipment is a capital investment or long-term decision
requiring use of discounted cash flow technique. But, here discussion is confined to short

25 | P a g e
Notes by HBS
range problems. Therefore, only one aspect of replacement will be dealt with, i.e. how to
deal with written down/book value of old equipment. And differential cost approach is
primarily followed because replacement will invariably involve additional fixed cost. Major
considerations relevant to decision are given below:

- Determine relevant items of cash outflows and inflows due to the decision.

- Book value or written down value is irrelevant for the decisions- loss on sale of old
machinery is irrelevant for this decision.

- Sales proceeds of old equipment is relevant for the decision and be considered for this
analysis.

- Replacement of machinery may bring down the cost per unit, but it may involve capital
outlay. Here the firm may have to decide at what point replacement will be justified.

- Profit or loss on sales of assets being replaced may affect tax payment and this taxation
effect should be included in analysis.

Items Of Differential Cost:

- Capital equipment and associated cost, viz, interest and depreciation.

- Loss on sales of old equipment ( if affect by tax)

- Increase in fixed overhead cost.

Items of Differential Benefits:

- Saving in operating cost - tax benefits if any

- Increase volume and value of production

- Realizable value of old machine.

Q3. Suggest and Justify the material handling equipment for handling following
materials:

a) Car assembly line : Material handling (MH) involves “short-distance movement

that usually takes place within the confines of a building such as a plant or a

26 | P a g e
Notes by HBS
 warehouse and between a building and a transportation agency.”1 It can be used to
create “time and place utility” through the handling, storage, and control of
material, as distinct from manufacturing (i.e., fabrication and assembly operations),
which creates “form utility” by changing the shape, form, and makeup of material.2
It is often said that MH only adds to the cost of a product, it does not add to the
value of a product. Although MH does not provide a product with form utility, the
time and place utility provided by MH can add real value to a product, i.e., the value
of a product can increase after MH has taken place; for example: • The value (to the
customer) added by the overnight delivery of a package (e.g., Federal Express) is
greater than or equal to the additional cost of the service as compared to regular
mail service—otherwise regular mail would have been used. • The value added by
having parts stored next to a bottleneck machine is the savings associated with the
increase in machine utilization minus the cost of storing the parts at the machine.

Consider the assembly of a car: assume that certain steps in the assembly line are to
install the engine, install the hood, and install the wheels (in that order, with arbitrary
interstitial steps); only one of these steps can be done at a time. In traditional production,
only one car would be assembled at a time. If engine installation takes 20
minutes, hood installation takes five minutes, and wheels installation takes 10 minutes,
then a car can be produced every 35 minutes.

In an assembly line, car assembly is split between several stations, all working
simultaneously. When one station is finished with a car, it passes it on to the next. By
having three stations, a total of three different cars can be operated on at the same time,
each one at a different stage of its assembly.

After finishing its work on the first car, the engine installation crew can begin working on
the second car. While the engine installation crew works on the second car, the first car
can be moved to the hood station and fitted with a hood, then to the wheels station and
be fitted with wheels. After the engine has been installed on the second car, the second
car moves to the hood assembly. At the same time, the third car moves to the engine
assembly. When the third car’s engine has been mounted, it then can be moved to the
hood station; meanwhile, subsequent cars (if any) can be moved to the engine
installation station.

Assuming no loss of time when moving a car from one station to another, the longest
stage on the assembly line determines the throughput (20 minutes for the engine
installation) so a car can be produced every 20 minutes, once the first car taking 35
minutes has been produced.

27 | P a g e
Notes by HBS
b) Coal in thermal power plant :- Introduction to Coal
handling plant
In a coal based thermal power plant, the initial process in the power
generation is “Coal Handling”. So in this article i will discuss the overall
processes carried out at a Coal Handling plant in a coal based thermal
power generating station.
The huge amount of coal is usually supplied through railways. A railway
siding line is taken into the power station and the coal is delivered in the
storage yard. The coal is unloaded from the point of delivery by means
of wagon tippler. It is rack and pinion type. The coal is taken from the
unloading site to dead storage by belt conveyors. The belt deliver the
coal to 0m level to the pent house and further moves to transfer point8.

The transfer points are used to transfer coal to the next belt. The belt
elevates the coal to breaker house. It consists of a rotary machine, which
rotates the coal and separates the light dust from it through the action of
gravity and transfer this dust to reject bin house through belt.

The belt further elevates the coal to the transfer point 7 and it reaches
the crusher through belt. In the crusher a high-speed 3-phase induction
motor is used to crush the coal to a size of 50mm so as to be suitable
for milling system. Coal rises from crusher house and reaches the dead
storage by passing through transfer point 8.

28 | P a g e
Notes by HBS
Stages in coal handeling power plant

Equipment used in a coal handling plant

1. Pull chord switch
A series of such switches are arranged in series at a 1m distance on the
side of conveyor belt. The power supply to rotor of the conveyor belt is
established only if all switches in series are connected.

2. Vibrating feeder
The coal stored in a huge hub is collected on the belt through vibrations
created by the vibrating feeder.

29 | P a g e
Notes by HBS
3. Flap gates
These are used to channelize the route of coal through another belt in
case the former is broken or unhealthy. The flap gates open let the coal
pass and if closed stop its movement.

4. Magnetic separator
these are used to separate the ferrous impurities from the coal.

5. Metal detector
These are detect the presence of any ferrous and non-ferrous metal in the
coal and sends a signal to a relay which closes to seize the movement of
belt until the metal is removed. It basically consists of a transmitter and a
receiver.

The transmitter consists of a high frequency oscillator, which produces a

oscillations of 1500 Hz at 15V. The receiver receives this frequency
signal. If there is any presence of metal in the coal. Then this frequency is
disturbed and a tripping signal is send to relay to stop the conveyor belt.

6. Belt weightier
It is used to keep an account of the tension on the belt carrying coal and is
moves accordingly to release tension on the belt.

7. Reclaim hopper
Reclaimation is a process of taking coal from the dead storage for
preparation or further feeding to reclaim hoppers. This is accomplished by
belt conveyors.
Top

30 | P a g e
Notes by HBS
Steam generation from coal
1. Tipplers
Coal from the coal wagons is unloaded in the coal handling plant. This
unloading is done by the “Tipplers”. This coal is transported up to the raw
coal bunkers with the help of conveyor belts.

2. Crush House
After hand picking foreign material, coal is transported to the Crush house
by conveyor belts where it is crushed to small pieces of about 20 mm
diameter. The crushed coal is then transported to the store yard. Coal is
transported to bowl mills by coal feeders.

3. Bowl Mill
The coal is pulverized in the bowl mill, where it is grounded to a powder
form. The mill consists of a round metallic table on which coal particles
fall.

This table is rotated with the help of a motor. There are three large steel
rollers, which are spaced 120” apart. When there is no coal, these rollers
do not rotate but when the coal is fed to the table it packs up between
rollers and the table and this forces the rollers to rotate.

Coal is crushed by the crushing actions between the rollers and

rotating tables.
4. Furnaces
This crushed coal is taken away to the furnace through coal pipes with the
help of hot and cold air mixture from P.A Fan. P.A Fan takes atmospheric
air, a part of which is sent to Air pre-heaters for heating while a part goes
directly to the mill for temperature control.

31 | P a g e
Notes by HBS
Atmospheric air from F.D Fan is heated in the air heaters and sent to
the furnace as combustion air.
5. Boiler
Boiler used in the power plant is suspended type. This prevents it from
getting deformed, when a subjected to very high temperatures.
The boiler is divided into two cylindrical parts namely the Primary and the
Secondary boiler. Water from the boiler feed pump passes through
economizer and reaches the boiler drum. Water from the drum passes
through down comers and goes to bottom ring header. Water from the
ring header is divided to all the four side of furnace.

Due to heat and density difference the water rises up in the water
wall tubes.
Water is partly converted to steam as it rises up in the furnace. This steam
and water mixture is again taken to the boiler drum where the steam is
sent to super heaters for superheating.

The super heaters are located inside the furnace and the steam is
superheated (540°C) and finally it goes to turbine. Flue gasses from the
furnace are extracted by induced draft fan, which maintains balance draft
in the furnaces with forced draft fan. These flue gasses emit their heat
energy to various super heaters in the pant house and finally pass through
air pre-heaters and goes to electrostatic precipitator where the ash
particles are extracted. Electrostatic precipitator consists of metal plates,
which are electrically charged.

Ash particles are attracted on to these plates, so that they do not pass
through the chimney to pollute the atmosphere.

Regular mechanical hammers blows cause the accumulation of ash to fall

to the bottom of the precipitator where the bottom of the precipitator where
they are collected in a hopper for disposal. This ash is mixed with water to
form slurry and is pumped to ash pond.

32 | P a g e
Notes by HBS
c) Cotton in textile Mill :-

Textile mill consumes a huge amount of raw material for conversion of raw material to final
products. The mills are using a large number of machines and processes. During conversion of raw
material to end product; material moves from one department to other, one machine to other
machine and from one floor to other. Day by day, production of each machine is going up. To
achieve the target of production, the mill management is facing the challenge of safe, efficient and
economical material handling. In this paper it is tried to provide the required knowledge of material
handling in reference to textile mills.

Material handling can be defined as: “art and science of conveying, elevating, positioning,
transporting, packaging and storing of materials Starting from the time, the raw material (such as
fibres for spinning unit or yarns for weaving/ knitting unit and fabrics for wet processing or
garmenting units) enters the mill gate and goes out of the mill gate in the form of finished products;
it is handled at all stages within mill boundaries such as within and between raw material stores,
various section of production department, machine to machine and finished product stores. A
material may be handled even 50 times or more before it changes to finished product. It has been
estimated that average material handling cost is roughly 10-30% of the total production cost
depending upon product to process. By saving in the material handling cost, the cost of production
can be reduced considerably. Material handling involves the movement of materials, manually or
mechanically in batches or one item at a time within the plant. The movement may be horizontal,
vertical or the combination of these two. Material movement adds to the cost but not to the product
value. The ideal mill would have an absolute minimum of materials handling and more use of
mechanical material handling equipments. The shortage of labour and increasing wages cost
demand the most efficient use of labour. Proper material handling offers benefits for:

i. improving productivity

ii. increasing the handling capacity

ii. reducing man-power iv. increasing the speed of material movement v. reducing
materials wastage vi. promoting easier and cleaner handling vii. eliminating idle
time of machines, equipment and workers viii.reduce fatigue incurred by the
workers ix. increasing safety and minimising accidents x. locate and stock
material better and in less space xi. minimising production cost, etc

4. SELECTION OF MATERIAL HANDLING EQUIPMENTS There are two most important aspects for
analyzing or solving a material handling problem are: engineering aspect, and economic aspect.
Engineering factors include: the condition of existing building and plant layout, production processes
and equipments, nature of materials and products to be handled, usefulness and effectiveness of
existing material handling equipment. The economic factors include the cost of material handling

33 | P a g e
Notes by HBS
equipment, operating costs, repair and maintenance costs and taxes etc. The choice of a particular
equipment depends upon specific requirements or the condition of an industry. For selection of
Material handling equipment, the following factors should be taken into account: i) Type/shape of
materials to be transported: The size of material, its shape, weight, delicacy and its chances of
getting damaged during handling etc. should be considered. ii) Mill building and layout: The route of
material movement, width of doors and aisles, inequality in floor levels, height of the ceiling,
strength of floor and walls, columns and pillars etc. to a great extent influence the choice of a
material handling equipments. iii) Machine production: Different machines have different outputs
per unit time. The material handling equipment should be able to handle the maximum output. iv)
Type of material flow pattern: A horizontal flow pattern will need trucks, overheads bridge cranes,
conveyors etc, whereas a vertical flow pattern will require elevators, conveyors, pipes etc. v) Types
of production: The selection of the material handling equipments depends a great extend on type of
production such as: mass production and batch production. Conveyors are more suitable for mass
production on fixed routes and powered trucks for batch production. vi) Other factors: Some other
factors also considered during selection of material handling cost are: cost of material handling
equipment, handling costs, life of the equipment and amount of care and maintenance required for
the equipment. 5. MATERIAL HANDLING EQUIPMENTS A wide range of material handling
equipments is available in the market; which are suitable to the most of the industrial requirements.
Material handling equipments are classed as: 1. Industrial trucks: manual and powered

2. Cranes: overhead bridge crane, jib crane and gantry crane 3. Hoists : chain type manual, electrical
and pneumatic, 4. Conveyors: belt conveyors, roller conveyor, drag conveyor, bucket conveyor, pipe
line (pneumatic) conveyor, chain or cable conveyor 5. Monorail 6. Slides and chutes 7. Lift 8. Tractors
and trailers etc. In the textile mills, there are many types of materials viz. raw materials, purchased
components, material in process, finished goods, packing material, maintenance and repair supplies,
scrape and waste etc. These materials are of various size, shape and specific features. For this
purpose, mostly special and some general type material handling equipments are used in textile
industries.

d) Hot clinker of cement :-

Hot cement describes clinker that has, through the process of grinding, gained
additional energy stored in the form of heat. Once the clinker is ground, this hot
cement is stockpiled in storage silos where the elevated temperature, especially in
warm climates, is not readily abated.

Summer months exacerbate the situation since ambient temperatures are generally
high and cement consumption increases. The warmer temperatures reduce the
ability of the hot cement to release large quantities of heat to the ambient air; and
increased consumption means freshly ground cement is not stored very long before
being shipped to the ready-mixed plants for use in batching.

34 | P a g e
Notes by HBS
Many attribute slump loss, strength reduction, or other concrete-related problems to the
temperature of the cement upon batching. However, research has shown that cement’s
ultimate effect on the concrete mixture’s temperature is quite minimal.

Initial studies by Lerch, 1955, (see reference below) and duplicated research has shown that
to lower the temperature to normal concrete by 1 degree Celcius, the temperature of the
cement must be reduced by 8.2 degrees Celcius, the temperature of the water reduced by
4.9 degrees Celcius, and the temperature of the aggregates lowered only 1.5 degrees
Celcius. Thus the influence of cement temperature on overall concrete batch temperature is
less than that of the other concrete ingredients. See Table 1 below, adapted from Design
and Control of Concrete Mixtures, 2002, for a representation of the effect between relative
mass proportions and specific heat capacity and temperature influence on a concrete mix.

A typical process of manufacture consists of three stages:

• grinding a mixture of limestone and clay or shale to make a fine "rawmix" (see Rawmill);
• heating the rawmix to sintering temperature (up to 1450 °C) in a cement kiln;
• grinding the resulting clinker to make cement (see Cement mill).

In the second stage, the rawmix is fed into the kiln and gradually heated by contact with the hot
gases from combustion of the kiln fuel. Successive chemical reactions take place as the
temperature of the rawmix rises:

• 70 to 110 °C - Free water is evaporated.

• 400 to 600 °C - clay-like minerals are decomposed into their constituent oxides; principally
SiO2 and Al2O3. Dolomite (CaMg(CO3)2) decomposes to calcium carbonate, MgO and CO2.
• 650 to 900 °C - calcium carbonate reacts with SiO2 to form belite (Ca2SiO4).
• 900 to 1050 °C - the remaining calcium carbonate decomposes to calcium oxide and CO2.
• 1300 to 1450 °C - partial (20–30%) melting takes place, and belite reacts with calcium oxide
to form alite (Ca3O·SiO4).

Typical clinker nodules

Alite is the characteristic constituent of Portland cement. Typically, a peak temperature of 1400–
1450 °C is required to complete the reaction. The partial melting causes the material to
aggregate into lumps or nodules, typically of diameter 1–10 mm. This is called clinker. The hot
clinker next falls into a cooler which recovers most of its heat, and cools the clinker to around
100 °C, at which temperature it can be conveniently conveyed to storage. The cement kiln
system is designed to accomplish these processes .

35 | P a g e
Notes by HBS
e) Hazardous Chemical in Chemical Plant :-

Dangerous chemicals and gases are handled and stored at nearly all chemicals and
explosives plants, oil refineries, pulp and paper plants, paint factories, paintshops,
power plants, water purification plants, ports and many other facilities. Dangerous
chemicals and gases include flammable liquids, natural gas and liquefied petroleum
gas (LPG), and chemicals that pose a risk to health and the environment.

All production plants carrying out large-scale handling and storage of chemicals must
appoint a chemicals supervisor. The supervisor ensures that the production plant
follows the provisions on dangerous chemicals, the licence conditions, and the
prepared operational principles and plans.

Among the many justifications for using robotics, the most important is to shield
people from working in dangerous environments and from handling hazardous
materials. From dealing with chemicals that are explosive to handling radioactive
substances, robots are routinely used to perform tasks that would kill or maim
people.

Robots are ideal for use in hazardous environments by removing people from direct
exposure to unfriendly conditions such as materials that are radioactive or highly
explosive,’‘ says Isabelle Roberts, Vice President for Business Development at BRIC
Engineered Systems, Oshawa, Ontario, Canada.

Haz Mat Robots

By design, munitions are explosive items that are dangerous to humans and consist
of hazardous chemicals. When munitions are to be dismantled due to treaty
obligations or obsolescence, robotics are the preferred means to take them apart
into their constituent pieces. This task is a specialty of PAR Systems, Inc.,
Shoreview, Minnesota, a robot manufacturer and system integrator. Thomas Frantz,
Environmental Products Group Program Manager at PAR speaks of how robotics
are used for munition disassembly. ‘‘PAR is focused on handling munitions, such as
leftover World War II nerve gas ordnance. The chemicals are decomposing and the
materials are corroding,’‘ Frantz says. ‘‘Robots pick up the munitions and place them
in various process stations.’‘ Due to the fact that these old munitions are corroding,
they are even more dangerous than is typical.

Shielding people from hazardous chemicals and processes was also on the mind of
Bruce Toyama, General Industry and Life Science Sales Manager at Applied
Robotics, Inc., Glenville, New York. ‘‘One of the justifications for using robotics in
handing chemicals and hazardous materials is reducing worker exposure.
Companies want to reduce potential liability for workers’ compensation or other costs
associated with worker exposure,’‘ says Toyama. ‘‘Liability is a big operating
expense for chemical producers and chemical users. Limiting workers’ exposure is a
very real and practical driver.’‘ Reducing liability by removing people from hazardous
chemicals is a concept that companies can easily quantify to justify investing in
robotics.

36 | P a g e
Notes by HBS
Q4. a) How do health hazards, safety and environmental conditions
influences effective operating of any organization.

Ans:- The workplace has bearing on health because of the multitude of hazards which
exist in many working environments. Those hazards may relate to a wide range of
physical, chemical and biological agents. Many aspects are regulated (e.g.
the Health and Safety at Work Act, and the Control of Substances Hazardous to Health
regulations), while in other areas guidance and approved Codes of Practice help to
maintain good working practices. Positive aspects of the occupational
environment for health are briefly considered in the next section (9).

Key definitions and terms

Health and Preventing people from being harmed or becoming ill by work by taking the right
safety precautions; providing a satisfactory working environment

Hazard Anything that may cause harm e.g. chemicals, electricity, working from ladders, an
open drawer

Risk A careful examination of the potential causes of harm in the workplace, so as to

assessment inform the implementation of reasonable measures to reduce health risks
(for health
and safety)

Stress The adverse reaction people have to excessive pressure or other types of demand
placed on them

Workplace health, safety and welfare

The The workplace is an environment in which most adults spend a substantial fraction of
workplace their time. It has the potential to have both positive and negative influences on their
health and well-being
– sometimes with lasting effects. Factors influencing health include the following:

Workplace • Temperature and humidity.

factors
affecting - Adequate (indoor) heating is important to provide thermal comfort in cold
weather (normally to at least 16 °C if work is mainly sedentary, and to at least 13°C
health
where physical effort required). Particular cold stresses may occur
in certain occupations, e.g. food preparation, open air working;

- Protection is also needed against heat stress from high ambient temperatures,
high thermal radiation and/or high levels of humidity (laundries, foundries etc).
• Ventilation.

- Adequate air movement and rate of air exchange is important to maintain air
quality;

(NB From 1 July 2007, it has been against the law to smoke in enclosed public

37 | P a g e
Notes by HBS
 places and workplaces in England. Similar legislation exists in Scotland and Wales).
• Ergonomics / physical arrangement of work area & equipment.

- These are factors that allow people to work comfortably and in safety. For
example, for office workers, the height and orientation of computer screens,
chairs which provide postural support.
• Space, lighting and cleanliness of the work area.
Safety factors • Maintenance/good repair.

- Especially important for safety equipment and equipment which could create a
risk if faulty
• Routes for safe movement of people and vehicular traffic, including provision of
unobstructed emergency exits.
• Physical aspects.

- Doors, gates, windows should be suitably constructed and fitted with safety
devices if necessary (e.g. to prevent risk of fall if above ground level, shatterproof
glazing in doors etc). Use of such measures as fencing, rails and
covering of pits/tanks to prevent risk of falls from height
• Control of hazardous agents (see below).
Welfare Facilities for the welfare of workers and visitors include

• lavatories and washing facilities;

• provision of drinking water;
• facilities for rest and to eat meals.
Specific Many work environments contain sources of hazardous substances (chemicals, dust,
hazards fumes, biological agents), which may cause exposure by inhalation, dermal
absorption, splashing into eyes, or
ingestion. These are covered by specific legislation (see COSHH below).

One of the most common forms of workplace injury arises from slips and
trips. Care to remove tripping hazards is especially important where there is
public access. Falls from height, especially off ladders, is one of the major
contributors to workplace deaths and serious injuries.
Musculoskeletal disorders relating to workplace activities are common, and
include injuries from manual handling (heavy lifting etc – a major cause of
days off work) and repetitive strain injuries (RSI). Display screen equipment
(e.g.
computer) can give rise to musculoskeletal disorders, including RSI, and eye
strain
Asbestos is the largest single cause of work related fatal disease and ill health
in Great Britain, though it is now mostly the result of past exposures.
Powered hand tools etc can cause ‘vibration syndromes’, and vibration from a
vehicle or machine passing through the seat can cause or aggravate whole back
pain. Noise can damage hearing, but it can also be a serious nuisance
affecting concentration and physiological parameters.
Most electricity deaths are caused by contact with overhead or underground

38 | P a g e
Notes by HBS
 power cables. Non-fatal shocks can cause severe and permanent injury.
Pressure systems – systems containing a fluid under pressure (e.g. pressure
cookers, boilers, steam heating systems) – account for about 150 incidents /
year in England, mainly due to equipment failure through poor design,
incorrect
operation or poor maintenance
Radiation risks are usually strictly controlled. Ionizing radiation risks may
arise from exposure to x-rays or radionuclides e.g. medical imaging, as well as
from radon gas from the ground. Also includes damage and cancer risk
from UV radiation (e.g. from sun).

Stress Stress is an over-used and imprecisely defined term. However, it is clear what most
people mean by it, and there is a large body of research that shows a link between
markers of stress and
subsequent ill health. The HSE defines stress as ‘the adverse reaction people have to
excessive pressure or other types of demand placed on them.’ It can be tackled in
similar way to any other form of workplace hazard – by
identifying contributing causes and attempting to reduce them. Factors that often
appear important include:

• lack of control over the way work is done;

• work overload (or underload);
• lack of support from managers;
• conflicting or ambiguous roles;
• poor relationships with colleagues (including bullying);
• poor management of organisational change.

Responsibilities and the law

HSE In England, health and safety within factories, farms and building sites is enforced by
the Health and Safety Executive (HSE), and in offices, shops, hotels, and catering and
leisure
facilities by local authorities.

Regulation Three main forms of regulation are used:

• Guidance (not compulsory, but aimed at helping compliance with the law);
• Approved Codes of Practice (support good practice, and have legal status in that
an employer may be found at fault if they have not followed relevant provisions);
• Regulations (legal requirements).
Legislation In recent years, more health and safety law has originated from Europe as proposals
and Directives of the European Commission, but the main basis of British legislation
is:

- Health and Safety at Work Act 1974, which sets out the general duties
which employers have towards employees and members of the public, and
employees have to themselves and to each other ‘so far as is reasonably
practicable’
- The Management of Health and Safety at Work Regulations 1999 (the

39 | P a g e
Notes by HBS
 Management Regulations), which make more explicit what is required of
employers under the Health and Safety at Work Act
Employers have responsibility to ensure the health, safety and welfare of their
workforce (with a written policy if they have more than five employees), to
assess risks, to ensure implementation of necessary protection measures, to
provide
relevant staff training, to publicize health and safety information, to report
injuries and accidents.
Employees have a duty to take reasonable care for their own health and safety
and that of others, to cooperate with an employer on health and safety matters,
including by use of protection equipment. Employees can refuse to do
something unsafe without being threatened with disciplinary action.

Risk assessment
Risk Much of health and safety is based on the principle of risk assessment (note, the use
assessment of the term risk assessment here should be distinguished from its use to imply
quantification of risk
(similar to health impact assessment) as described in section 10 below).

The law does not expect elimination of risk, but it requires that people are
protected as far as ‘reasonably practicable’. The principal elements of a risk
assessment are:
(1) To identify the hazards;

(2) To decide who might be harmed and how;

(3) To evaluate the risks and decide on precautions;

(4) To record and implement findings;

(5) To review risk assessment and update if necessary.

Control of Substances Hazardous to Health (COSHH)

COSHH The law requires employers to control exposure to hazardous substances –
chemicals, dusts and fumes – that may cause toxic effects, infections, cancers,
allergic responses, asphyxiation
etc. The principal law is the Control of Substances Hazardous to Health Regulations
2002 (COSHH) (as amended).

These regulations cover substances that are dangerous to health, including

biological agents, substances with workplace exposure limits, pesticides,
medicines, cosmetics and substances produced in chemical
processes. Asbestos,
lead , radioactive materials, and substances with explosive or flammable
properties are covered by other regulations.
COSHH sets out eight steps that employers (and sometimes employees) must

40 | P a g e
Notes by HBS
 take. They are:
• Assess the risks;
• Decide on necessary precautions;
• Prevent or adequately control exposure;
• Ensure use and maintenance of control measures;
• Monitor exposure;
• Carry out appropriate health surveillance;
• Prepare plans and procedures for accidents, incidents and emergencies;
• Ensure employees are properly informed, trained and supervised.

Q4. b) Explain concept of group technology in detail.

Ans:- Manufacturing technique in which functionally-

grouped machines (producing parts or products with
similar characteristics)
are organized into cells to achieve high repeatability levels.

Group technology or GT is a manufacturing technique[1] in which parts having similarities

in geometry, manufacturing process and/or functions are manufactured in one location using a
small number of machines or processes. GT is based on a general principle that many problems
are similar and by grouping similar problems, a single solution can be found to a set of problems,
thus saving time and effort.

The group of similar parts is known as part family and the group of machineries used to process
an individual part family is known as machine cell. It is not necessary for each part of a part
family to be processed by every machine of corresponding machine cell. This type of
manufacturing in which a part family is produced by a machine cell is known as cellular
manufacturing. The manufacturing efficiencies are generally increased by employing GT
because the required operations may be confined to only a small cell and thus avoiding the need
for transportation of in-process parts.[2]

Group technology is an approach in which similar parts are identified and grouped together in
order to take advantage of the similarities in design and production. Similarities among parts
permit them to be classified into part families.

The advantage of GT can be divided into three groups:

1. Engineering
2. Manufacturing
3. Process Planning

41 | P a g e
Notes by HBS
 What is Group Technology (GT)?
Posted on April 17, 2011 by admin |

Group Technology also known as GT, is a manufacturing technology where similar parts are collectively identified and
grouped to use the benefit of their relationship in design and as well as in production. The similar parts are grouped to
form part families. Each and every family has similar design and manufacturing qualities.

Example: A plant manufacturing 10,000 various parts could be capable to arrange into 30 to 40 part families.

As each member in a family have nearly processing activities, collection of machines needed for processing of all part
family members leads to the most efficient method of manufacturing. This group or collection of machines is called as
GT Cells and this method of manufacturing is called as Cellular Manufacturing.

Part Family:
The collection of parts with similar design characteristics and similar manufacturing characteristics is known as part
family. The parts in a part family are different however the similarities are good enough to classify them as one of the
member of a family.

The various methods implemented for part family grouping are visual inspection, coding and classification,
and analysis of production flow.

Part Classification and Coding System:

It concerns with identification of similarities with parts and it relates those similarities in the form of code. The similarities
could be design characteristics alone or manufacturing characteristics alone or both characteristics. The part
classification and coding system can be fallen into three categories:

System related to design characteristics,

System related to manufacturing characteristics, and

System related to both design and manufacturing characteristics.
Coding Structure:
The coding system is comprised of series of symbols which is used to identify the design and manufacturing
characteristics of the parts. The symbols can be in the form of all alphabetic or all numeric or the both. This
arrangement of symbols is called as Coding Structure. It can be divided into three types:

Chain type Structure,

Hierarchial Structure, and

Hybrid Structure.
Advantages of Group Technology:

Maximizes the output

Less lead time

Less setting time

Reduced scrap

Reduced material handling
Therefore by concluding, a plant implementing group technology will obtain better overall control and better job
satisfaction.

42 | P a g e
Notes by HBS
Q5. a) Explain the application of computer aided approach in warehousing

Ans:- Computer-aided design (CAD), also known as computer-aided design and

drafting (CADD), involves the entire spectrum of drawing with the aid of a
computer—from straight lines to custom animation. In practice, CAD refers to
software for the design of engineering and architectural solutions, complete with two-
and three-dimensional modeling capabilities.

Computer-aided manufacturing (CAM) involves the use of computers to aid in any

manufacturing process, including flexible manufacturing and robotics. Often outputs
from CAD systems serve as inputs to CAM systems. When these two systems work
in conjunction, the result is called CADCAM, and becomes part of a firm's computer-
integrated manufacturing (CIM) process.

CADCAM systems are intended to assist in many, if not all, of the steps of a typical
product life cycle. The product life cycle involves a design phase and an
implementation phase. The design phase includes identifying the design needs and
specifications; performing a feasibility study, design documentation, evaluation,
analysis, and optimization; and completing the design itself. The implementation
phase includes process planning, production planning, quality control, packaging,
marketing, and shipping.

CAD systems can help with most of the design phase processes, while CAM
systems can help with most of the implementation processes

The manufacturing process includes process planning, production planning

(involving tool procurement, materials ordering, and numerical control programming),
production, quality control, packaging, marketing, and shipping. CAM systems assist
in all but the last two steps of this process. In CAM systems, the computer interfaces
directly or indirectly with the plant's production resources.

Process planning is a manufacturing function that establishes which processes and

parameters are to be used, as well as the machines performing these processes.
This often involves preparing detailed work instructions to machines for assembling
or manufacturing parts. Computer-aided process planning (CAPP) systems help to
automate the planning process by developing, based on the family classification of
the part being produced, a sequence of operations required for producing this part
(sometimes called a routing), together with text descriptions of the work to be done
at each step in the sequence. Sometimes these process plans are constructed
based on data from the CAD databases.

43 | P a g e
Notes by HBS
Process planning is a difficult scheduling problem. For a complex manufacturing
procedure, there could be a huge number of possible permutations of tasks in a
process requiring the use of sophisticated optimization methods to obtain the best
process plan. Techniques such as genetic algorithms and heuristic search (based on
artificial intelligence) are often employed to solve this problem.

The most common CAM application is numerical control (NC), in which programmed
instructions control machine tools that grind, cut, mill, punch, or bend raw stock into
finished products. Often the NC inputs specifications from a CAD database, together
with additional information from the machine tool operator. A typical NC machine tool
includes a machine control unit (MCU) and the machine tool itself. The MCU
includes a data processing unit (DPU), which reads and decodes instructions from a
part program, and a control loop unit (CLU), which converts the instructions into
control signals and operates the drive mechanisms of the machine tool.

In a CADCAM system, a part is designed on the computer (via CAD) then

transmitted directly to the computer-driven machine tools that manufacture the part
via CAM. Within this process, there will be many other computerized steps along the
way. The entire realm of design, material handling, manufacturing, and packaging is
often referred to as computer-integrated manufacturing (CIM).

CIM includes all aspects of CAD and CAM, as well as inventory management. To
keep costs down, companies have a strong motivation to minimize stock volumes in
their warehouses. Just-in-time (JIT) inventory policies are becoming the norm. To
facilitate this, CIM includes material requirements planning (MRP) as part of its
overall configuration. MRP systems help to plan the types and quantities of materials
that will be needed for the manufacturing process. The merger of MRP with CAM's
production scheduling and shop floor control is called manufacturing resource
planning (MRPII). Thus, the merger of MRP with CADCAM systems integrates the
production and the inventory control functions of an organization.

Today's industries cannot survive unless they can introduce new products with high
quality, low cost, and short lead time. CADCAM systems apply computing
technology to make these requirements a reality, and promise to exert a major
influence on design, engineering, and manufacturing processes for the foreseeable
future.

Q5. b) SJ Describe line balancing with suitable example. State its objectives.

Ans:- Here is a simple definition and example of line balancing :

Everyone is doing the same amount of work

Doing the same amount of work to customer requirement

44 | P a g e
Notes by HBS
Variation is ‘smoothed’

No one overburdened

No one waiting

Everyone working together in a BALANCED fashion

Here we see operator number 1 over-producing, thus creating the other 6 wastes.

We simply re-balance the work content (Re distribute some of the work), using a Yamazumi board
as it is often known

In the example shown above, the Yamazumi exercise looks incredibly simple - So why
doesn't everyone do it ?

45 | P a g e
Notes by HBS
There are two vital pre requisites to balancing a line which must be in place before a yamazumi
exercise can take place.

These are:

Takt Time & Standard Work

Takt Time

Takt Time is the production "Drumbeat" based on customer demand

Standard Work

Whether you use Standard work combination tables, Standard work instruction sheets
or any other Standard work documentation will depend upon the type of work involved

46 | P a g e
Notes by HBS
Standard Work instruction sheets provide a detailed description of HOW to do a particular step of a
work operation. These provide a standard method of carrying out any particular task ensuring each
task is repeatable and reproducible.

Benefits of the pre requisites:

Takt time maximises the productivity due to:

· Easily managed processes

. Workflow is matched to customer demand

· Output of each process matches customer demand

Standard Operations provide:

47 | P a g e
Notes by HBS
· Capable and repeatable processes

· Process control at source

· Improves accuracy of planning

· Better adherence to plans

· A platform from which continuous improvement can be made

· Reduced costs

· Improved quality

· Basis for training

To advance your knowledge and career prospects using Lean Six Sigma, sign up for the free lean
six sigma training or the black belt certification course which includes a module on Line Balancing

Definition
A production strategy that involves setting an intended rate of production
for required materials to be fabricated within a particular time frame.
In addition, effective line balancing requires assuring that every
line segment's production quota can be met within the time
frame using the available production capacity.

From ancient times to the modern day, the concept of assembly has naturally been changed a lot.
The most important milestone in assembly is the invention of assembly lines (ALs). In 1913, Henry
Ford completely changed the general concept of assembly by introducing ALs in automobile
manufacturing for the first time. He was the first to introduce a moving belt in a factory, where the
workers were able to build the famous model-T cars, one piece at a time instead of one car at a time.
Since then, the AL concept revolutionized the way products were made while reducing the cost of
production. Over the years, the design of efficient assembly lines received considerable attention from
both companies and academicians. A well-known assembly design problem isassembly line
balancing (ALB), which deals with the allocation of the tasks among workstations so that a given
objective function is optimized.

48 | P a g e
Notes by HBS
 49 | P a g e
Notes by HBS
Q6. Write short notes on:

a) Capacity Estimation :-

Capacity is defined as that output which can be produced at minimum average total cost, given the
existing stock of plant and equipment and existing techniques and factor prices. The level of capacity
is inferred from observed investment behavior. Regression methods are used to estimate a
relationship between desired capital stock and several explanatory variables including output, relative
prices and time, on the hypothesis that net investment occurs in proportion to the excess of desired
over actual stock. The relationship between desired capital stock and output is then inverted to yield a
corresponding relationship between capacity and actual capital stock for given prices and techniques.
The method is used to calculate aggregate capacity annually for 1949-60 and the properties of the
resulting estimates are discussed. New estimates of capacity and its utilization in manufacturing are
also presented and compared with those of other investigators.

50 | P a g e
Notes by HBS
b) Computer aided approaches to facilities layout

Computer programs for layout planning are used in a minority of cases and an; often found only
marginally useful. This paper identifies several limitations in mainstream computer approaches and
suggests four main areas requiring further work. The facilities offerred by a prototype integrated
package for layout planning analysis are described and the use of interactive graphics for layout
planning are reviewed. The paper suggests that the way ahead in computer-aided layout planning lies
in integrating these techniques within a powerful computer-aided design/computer-aided manufacture
system.

51 | P a g e
Notes by HBS
Q7. Write Short notes on:

b) Strategic considerations and current trends in expansion of

facilities.

Ans:- Strategic facility planning recognizes that every decision made in business planning has a
direct impact on an organization’s real estate assets and needs. The purpose of the SFP plan,
therefore, is to develop a flexible and implementable plan based on the specific and unique
considerations of the individual business. A four-step process, shown in Figure 1, provides the
general format to accomplish this mission.1 Understanding Planning Analysis Acting Figure 1. SFP
Four-step Process Understanding Thoroughly understand the organization’s mission, vision, values
and goals. Many organizations follow a balanced scorecard of four key measurements: financial
performance; customer knowledge; internal business processes; and learning and growth. Analyzing
Use analytical techniques, such as SWOT analysis, SCAN, SLP or scenario planning, to explore the

52 | P a g e
Notes by HBS
range of possible futures and the triggers used to analyze an organization’s facility needs. Planning
Develop plans that meet the long-range needs of the organization. At minimum, the SFP should be
reviewed annually and further updated periodically as conditions require. Acting Take actions as
planned and implement the SFP. Feedback from actions taken can be incorporated into the next plan
and/or project to provide continuous improvement to future SFPs. The cyclical nature of constant
planning for the changing future and adopting plans along the way are normal events. These
changes and updates must be managed to ensure they are achievable.

Since facility management is still considered an emerging field, one goal of this document is to avoid
confusing terminology and set a standard for the facility management profession to move forward.
One area of confusion for many facility managers concerns the questions: How does a master plan
differ from a strategic facility plan? Is a campus plan part of a master plan or something else?
Currently, architects, consultants, builders and different organizations define these terms differently.
The three key outputs of facility planning are the strategic facility plan, the master plan and the
annual facility plan (often referred to as an approved budget or generically as a tactical plan).
However, confusion exists between master plans and SFPs since they may both answer the same
question: What building, buildings and space are needed to support our strategic goals?

The master plan, facility master plan or campus master plan provides a framework for the physical
environments that incorporate the buildings. Master planning develops the site-specific integration
of programmed elements, natural conditions and constructed infrastructure and systems at the
functional, aesthetic and temporal levels. The nature of the plan will influence, and be influenced by,
the context of the project location beyond the property lines. Alignment with community needs and
expectations is a critical factor of this phase.3 The development of a master plan starts with
alternative organizational configurations, often referred to as scenarios, to accommodate the needs
that are identified in the strategic facility plan. These scenarios or alternatives represent differing
priorities and criteria, and present choices for organizational and site/facility models. The master
planning process is best accomplished with input from a number of experts and stakeholders.
Components of a master plan include: regulatory analysis; infrastructure and transportation
planning; amenities and support planning; corporate image; security strategies; phasing plans; cost
projections; and environmental design. Expert planners need to ensure the outcome is achievable,
yet flexible enough to preserve future options.4 Master plans can include varying levels of detail but
usually include some or all of these space-use analyses: ■ Zoning, regulation, covenant assessments
■ Space standards/benchmarks descriptions ■ Program of space use ■ Workflow analyses ■
Engineering assessment and plan ■ Block, fit or stacking plans ■ Concept site plan or campus plan ■
Architectural image concepts ■ Long-term maintenance plan ■ Construction estimates ■ Phasing or
sequencing plan (the sequence of projects)5 The master plan is often summarized as a colored site
drawing or a timeline of projects which, in some cases, is referred to as the master plan. The three
types of facility plans and some of their major components are shown in Table 1 to help distinguish
between them. Items in each row are not comparative, but each cell stands on its own.

53 | P a g e
Notes by HBS
b) Automation in warehousing operations.

Warehouses are big targets for automation and optimization because they represent a major hub
in your supply chain infrastructure. Businesses are asking warehouse managers to cut costs,
improve throughput, increase accuracy—without more workers. Barcoding your inventory and
arming workers with scanners may not be enough to achieve your goals.

Automate Warehouse Operations with Mobile Data Collection

RFgen's mobile data collection and warehouse automation solutions maximize the efficiency of
your workflows and can help you:

• Increase throughput and raise the productivity of your employees with guided picking and
optimized paths.
• Transition to a paperless warehouse, eliminating latency and errors with manual data entry.
• Prevent stock-outs and minimize safety stock.
• Accelerate receiving by immediately routing items to ship (cross-docking) and kitting items
together for faster movement.
• Increase the accuracy of orders, leading to fewer costly returns.
• Implement voice-picking for even greater accuracy and speed, as well as improved safety.
• Incorporate data from automated warehouse equipment for a complete picture of your
warehouse or factory floor.
• Run your operations around the clock without disruption.

Empower Your Warehouse Manager

Many warehouse managers work off a clipboard to determine priorities for orders, when to
replenish an item and who should take which tasks. They rely on experience and estimates to
know if they will complete the jobs slated for the day. When equipped with a mobile device
running RFgen Warehouse Director, managers can track what jobs are left, who can do them,
and predict if more resources are needed. They can set inventory thresholds to keep popular
items stocked. And they can monitor worker productivity.

OR

Automated warehousing applied to part or all of a distribution centre operation can provide a
wide range of benefits including space savings, lower building costs, improved productivity, more
efficient material flow, less people, safer operations, reductions in inventory, increased reliability,
reduced running costs, better ROI and lowest lifecycle cost.

Automated warehousing applied to part or all of a distribution centre operation can provide a

54 | P a g e
Notes by HBS
wide range of benefits including space savings, lower building costs, improved productivity, more
efficient material flow, less people, safer operations, reductions in inventory, increased reliability,
reduced running costs, better ROI and lowest lifecycle cost.

Automated warehousing systems provide the maximum possible usage of available floor space
and building height. In some cases, this enables companies to increase storage capacity by up to
400% compared to conventional forklift operations. Where space is limited, switching to an
automated warehousing solution can free up additional space for other activities, such as
manufacturing.

And because automated warehousing solutions make the most effective use of space, building
costs can be kept to a minimum. Significant cost savings are possible through the need for less
land and a smaller building. Because Automated Warehousing systems do not require special
floors or expensive in aisle guidance systems. further savings can be achieved. Automated
storage and retrieval machines also weigh a lot less than comparable narrow aisle trucks further
reducing construction requirements.

Improved Productivity

Automated warehousing systems also offer tremendous performance in terms of productivity. Not
only do they work faster than forklifts and narrow aisle trucks, they can also operate 24 hours a
day, 7 days a week, keeping product on the move. With automated storage and retrieval
machines, there are none of the delays associated with putting away or retrieving pallets from
high locations. Every pallet is picked up and deposited at the same speed regardless of where it
is located within the system.

Automated warehousing systems can also enhance the efficient flow of materials through a
manufacturing facility or distribution centre. By integrating the system with production materials
handling systems, raw materials, tools, parts, work-in-process, and finished goods can all be
efficiently delivered to where they are required just-in-time.

The systems can also be set up to provide a buffer storage function on assembly lines, and can
service multi-floor applications. By using automated storage and retrieval machines the need for
drivers/operators is eliminated. Compared with conventional methods, and calculated over the
life of the machine, savings can be substantial and the ROI can be highly attractive. The
machines operate within fixed aisles protected by safety fences so the risk of people being
injured in a collision is minimised. The need for operators to physically lift heavy products, or
even heavy empty pallets, is also eliminated.

Reductions in Inventory

55 | P a g e
Notes by HBS
With integrated location and inventory control software combined with faster throughput, it is
possible to reduce stockholdings. Inventory can be accurately tracked at all stages, maximising
stock availability. Stock control can also be improved, with the software enabling goods to be
automatically picked on a First In First Out basis , or by 'use-by' date etc. Intelligent location
control ensures goods are located in the most appropriate zone depending on their usage within
the Automated Warehouse.

Once the automated warehouse has been set up, ongoing operating costs are minimised.
Typical warehousing costs involving refueling or recharging of batteries, regular mechanical and
electrical maintenance, and staffing, lighting are also minimised.

Internal Assignment Questions form Feb 2017

Q.1. a) Explain advantages, limitation, and suitability of :-

Cellular Layout :-

56 | P a g e
Notes by HBS
 57 | P a g e
Notes by HBS
CELLULAR LAYOUT
Cellular manufacturing is a type of layout where machines are grouped according to
the process requirements for a set of similar items (part families) that require similar
processing. These groups are called cells. Therefore, a cellular layout is an
equipment layout configured to support cellular manufacturing.

58 | P a g e
Notes by HBS
Processes are grouped into cells using a technique known as group technology
(GT). Group technology involves identifying parts with similar design characteristics
(size, shape, and function) and similar process characteristics (type of processing
required, available machinery that performs this type of process, and processing
sequence).

Workers in cellular layouts are cross-trained so that they can operate all the
equipment within the cell and take responsibility for its output. Sometimes the cells
feed into an assembly line that produces the final product. In some cases a cell is
formed by dedicating certain equipment to the production of a family of parts without
actually moving the equipment into a physical cell (these are called virtual or nominal
cells). In this way, the firm avoids the burden of rearranging its current layout.
However, physical cells are more common.

An automated version of cellular manufacturing is the flexible manufacturing system

(FMS). With an FMS, a computer controls the transfer of parts to the various
processes, enabling manufacturers to achieve some of the benefits of product
layouts while maintaining the flexibility of small batch production.

Some of the advantages of cellular manufacturing include:

• Cost. Cellular manufacturing provides for faster processing time, less material
handling, less work-in-process inventory, and reduced setup time, all of which reduce
costs.
• Flexibility. Cellular manufacturing allows for the production of small batches, which
provides some degree of increased flexibility. This aspect is greatly enhanced with
FMSs.
• Motivation. Since workers are cross-trained to run every machine in the cell,
boredom is less of a factor. Also, since workers are responsible for their cells' output,
more autonomy and job ownership is present.

Q2. A) State for what applications the following material handling equipment
are used:-

1) Forklift Truck :

Forklift trucks are the oldest applications among our fields of excellence. We have been
choice supplier for Jungheinrich and MCFE for many years and today, you will easily see
one of our filters installed on every kind of forklift from different brands.



It doesn't matter if it is a 50t super compact forklift, side loader or reach stacker. Our
experience with retrofitting forklifts from Toyota, Still, Linde, Hyster, Yale, Kalmar and
Manitou has proven to be a valuable advantage.

59 | P a g e
Notes by HBS

Common characteristics for this application include an unsteady duty-cycle and often low
exhaust gas temperatures. Due to the fact that a large number of forklifts are rental
applications the temperature profile of a vehicle changes and is unpredictable. Therefore,
we recommend an active regeneration and mainly install the MK-System. Customers with
a plug-in possibility and a non 24/7 operational availability often choose the ME-
System. The less expensive alternative of that system is the W-System, used in fleet
applications as well. Some installs have also included the MA-System, when the
temperature profile is fair enough.

Forklift control and capabilities

Forklift hydraulics are controlled either with levers directly manipulating the hydraulic valves, or
by electrically controlled actuators, using smaller "finger" levers for control. The latter allows
forklift designers more freedom in ergonomical design.

Forklift trucks are available in many variations and load capacities. In a typical warehouse setting
most forklifts have load capacities between one and five tons. Larger machines, up to 50 tons lift
capacity, are used for lifting heavier loads, including loaded shipping containers.

In addition to a control to raise and lower the forks (also known as blades or tines), the operator
can tilt the mast to compensate for a load's tendency to angle the blades toward the ground and
risk slipping off the forks. Tilt also provides a limited ability to operate on non-level ground.
Skilled forklift operators annually compete in obstacle and timed challenges at regional forklift
rodeos.

1) Belt Conveyor:
The Uses of Conveyor Belting Systems
1. 1. The Uses of Conveyor Belting SystemsMany years ago, labor was used to transport
goods and material in manufacturing industries. Transportationof products from one
place to another as they are being manufactured is essential. Originally, before
theadvancements in technology, it is humans who manually used to move and transport
goods. People wouldcarry these items by hand or some sort of mobile device and
transport or convey them. This posed a numberof risks to the production since there were
chances of mishandling, wear and tear as well as deterioration ofthe products. Physical
labour requires a lot of work force and time in order to transport good which was notonly
expensive but also ineffective for companies. These rising demands called for a new
invention; conveyorbelting systems which are also known as conveyor belts.With the
introduction of the conveyor belting systems, the transportation of goods in the
manufacturing industrybecome much easier, faster and also more economical. As
manual or physical labour was eliminated fromthe process, the company could save a
significant amount of money that they would otherwise have to spendon employee
wages. Material could be transported safely even in large quantities. With the success of
theconveyor belt or conveyor belting system, virtually every industry has started making
use of this piece ofequipment and now you would rarely find any manufacturing company
that is still dependent on human labour.This device that is responsible for moving and
transporting goods from one place to another is called aconveyor belting system. It is
typically connected to two or more pulleys that rotate and cause it to move in acontinuous
loop. Either one or both the pulleys can be motorized which will cause the conveyor
belting to moveand push the material on it forward. If only one pulley is motorized, it is
called the driver pulley and the pulleythat is not powered is called the idler.Conveyor

60 | P a g e
Notes by HBS
 belting systems can be categorized into two main industrial classes: general material
handlingand bulk material handling. General material handling conveyor belting is mainly
used in production facilitiesin order to transport goods and material from one place to
another. Bulk material handling conveyor beltingis often used in outdoor locations to
transport industrial or agricultural material such as coal, ores or grain.General material
handling conveyors may not be applicable to be used in place of bulk material
handlingconveyors. Also there are applications of small conveyor systems in places such
as grocery stores, restaurantor even the airport. The materials being used to make these
belts also vary according to their application.The under layer which is known as a
carcass provides the belt with linear strength and shape. It is usuallyplastic, cotton web
or mesh. The cover of the belt can be made from various combinations of rubber or
plasticdepending on the application of the belt.For more information on Conveyor Belt
Systems, including other interesting and informative articles and photos,please click on
this link: The Uses of Conveyor Belting Systems
2. Belting system made it possible to transport heavy objects from one place to another
over a short distance. The device involved in this system is conveyor belt. Conveyor belt is
a mechanical apparatus consisting of two or more pulleys with a continuous moving belt.
The pulley that is powered and responsible for moving the belt is a drive pulley while the
unpowered pulley is called the idler.
3.
4. Conveyor belt has two main categories namely, Fabric Belting and Steel Cord Belting. Their
external features seem identical but the internal structure is different. Fabric belting has
an inner layer that provides the tensile strength and shape of the belt identified as carcass.
It is made of cotton or plastic web or mesh. On the other hand, steel cord belts have a
series of steel cables embedded into the belt, separated by rubber. These belts are used
on moving sidewalks, escalators and numerous manufacturing procedures. Various types
of belts are available to use in different applications.
5.
6. Conveyor belts are typically suspended with a continuous loop of materials that rotates
about them. This is usually applied in an array of material transport applications such as in
food processing, manufacturing and heavy industries. There are also particular belting
system used in bakeries such as oven belts for pies and pizzas, roofing stones conveying,
extracted gravel transport and so on. Commercial industries belts are designed to solve a
specific industry purpose like the existence of agricultural, retail and construction belting
system. Power transmission belt is the most popular among the conveyor belt system. It is
used in power transmission applications such as belting for power take offs, engine belts
and industrial machinery.
7.
8. Only high quality materials should be used to conveyor belting system so that it can
withstand the weight of the loaded goods. Conveyor belts are developed to fulfill this
purpose in the most cost-effective manner and with the utmost practical degree of
reliability.

2) Overhead travelling crane

An overhead crane, commonly called a bridge crane, is a type of crane found in

industrial environments. An overhead crane consists of parallel runways with a traveling
bridge spanning the gap. A hoist, the lifting component of a crane, travels along the

61 | P a g e
Notes by HBS
 bridge. If the bridge is rigidly supported on two or more legs running on a fixed rail at
ground level, the crane is called a gantry crane or a goliath crane .

Unlike mobile or construction cranes, overhead cranes are typically used for either
manufacturing or maintenance applications, where efficiency or downtime are critical
factors.

Applications

Overhead cranes are commonly used in the refinement of steel and other metals such as copper
and aluminium. At every step of the manufacturing process, until it leaves a factory as a finished
product, metal is handled by an overhead crane. Raw materials are poured into a furnace by
crane, hot metal is then rolled to specific thickness and tempered or annealed, and then stored
by an overhead crane for cooling, the finished coils are lifted and loaded onto trucks and trains
by overhead crane, and the fabricator or stamper uses an overhead crane to handle the steel in
his factory. The automobile industry uses overhead cranes to handle raw materials.
Smallerworkstation cranes, such as jib cranes or gantry cranes, handle lighter loads in a work
area, such as CNC mill or saw.

Almost all paper mills use bridge cranes for regular maintenance needing removal of heavy press
rolls and other equipment. The bridge cranes are used in the initial construction of paper
machines because they make it easier to install the heavy cast iron paper drying drums and
other massive equipment, some weighing as much as 70 tons.

In many instances the cost of a bridge crane can be largely offset with savings from not renting
mobile cranes in the construction of a facility that uses a lot of heavy process equipment.

1) Roller Conveyor
To help industry convey light or heavy goods, Titan Industries offers custom roller bed
conveyors. These roller conveyors are available in both chain- and belt-driven models. Also
available in the roller conveyors category are Titan's Pathway® Line Shaft Conveyors, gravity
rollers and zero pressure accumulators.

When to use a roller conveyor?

Stainless roller conveyors are the proper choice when you need to side load, push off,
accumulate a product or adjust pressure on carrying rollers. Roller conveyor types are chain
driven, belt driven, line shaft driven, accumulation, or non-powered (gravity). Using roller
conveyors instead of slider bed conveyors adds versatility to the type of transfers, diverters and
stops that can be used in a system. Rollers are available in mild steel, galvanized, plastic or
stainless steel.

62 | P a g e
Notes by HBS

Roller conveyors are used for the transport of slabs, billets, or sheets in steel mills and
hot rolling mills. Depending on the rolled product, individual loads of up to 30 tonnes or
more can be conveyed. In hot rolling mills, for instance, the rolled product may not come
to a stop, because the rolls to be transported could be damaged in the process.
Therefore, the rolled product is constantly in movement until it is cooled down or it has
arrived at the next processing step. The movement, positioning, and control of the rolled
product must be continuously monitored and checked.

Proxitron light barriers, Piros infrared sensors, and pyrometers are ideally suited for
material recognition and monitoring in the area of the roller conveyor. The position or
dimensions of the slab can be determined and measured using light barriers or the LMB
optical distance measurement. You can also scale one-way light barriers, reflective light
barriers, photoelectric sensors, and infrared sensors from Proxitron, depending on the
application and prevailing temperatures. For extreme temperatures (up to 600 °C), you
can choose between devices with optical fibre variants with a cooling housing (200 °C).
An affordable variant in a durable stainless steel housing (75 °C) can be used for less
extreme conditions. The actuation temperature of Proxitron infrared sensors can be
flexibly adapted to the temperature of the object from cold 250 °C to hot 900 °C. We offer
optional air flushing in order to keep the lenses free from soot and scale.

q.2. b) State objectives of good plant layout. What are the principles of plant
layout?

Ans:- Plant layout is a mechanism which involves knowledge of the space requirements for
the facilities and also involves their proper arrangement so that continuous and steady
movement of the production cycle takes place. Moore, a very well known name in the
business world, explained plant layout as,” The plan of or the act of planning, an optimum
arrangement of facilities, including personnel, operating equipment, storage space,
materials handling equipment and all other supporting services along with the design of the
best structure to accommodate these facilities”.

The problems related to plant layout are generally observed because of the various
developments that occur. These developments generally include adoption of the new
standards of safety, changes in the design of the product, decision to set up a new plant,
introducing a new product, withdrawing the various obsolete facilities etc.

Objectives of a good plant layout are –

1. Providing comfort to the workers and catering to worker’s taste and liking.
2. Giving good and improved working conditions.
3. Minimizing delays in production and making efficient use of the space that is
available.
4. Having better control over the production cycle by having greater flexibility for
changes in the design of the product.

63 | P a g e
Notes by HBS
Objectives of Plant layout:
A properly planned plant layout aims at achieving the following objectives:
1. To achieve economies in handling of raw materials, work in- progress and
finished goods.

2. To reduce the quantum of work-in-progress.

3. To have most effective and optimum utilisation of available floor space.

4. To minimise bottlenecks and obstacles in various production processes thereby

avoiding the accumulation of work at important points.

5. To introduce system of production control.

6. To ensure means of safety and provision of amenities to the workers.

7. To provide better quality products at lesser costs to the consumers.

8. To ensure loyalty of workers and improving their morale.

9. To minimise the possibility of accidents.

10. To provide for adequate storage and packing facilities.

11. To workout possibilities of future expansion of the plant.

12. To provide such a layout which permits meeting of competitive costs?

The objectives of plant layout have been nicely explained by Shubin and
Madeheim. “Its objective is to combine labour with the physical properties of a
plant (machinery, plant services, and handling equipment) in such a manner that
the greatest output of high quality goods and services, manufactured at the lowest
unit cost of production and distribution, will result.”

64 | P a g e
Notes by HBS
Principles of a good plant layout are –

1. A good plant layout is the one which is able to integrate its workmen, materials,
machines in the best possible way.

2. A good plant layout is the one which sees very little or minimum possible movement of
the materials during the operations.

3. A good layout is the one that is able to make effective and proper use of the space that is
available for use.

4. A good layout is the one which involves unidirectional flow of the materials during
operations without involving any back tracking.

5. A good plant layout is the one which ensures proper security with maximum flexibility.

6. Maximum visibility, minimum handling and maximum accessibility, all form other
important features of a good plant layout.

Plant Layout and its principles

A plant layout is the placing of the right items coupled with the right place and the right
method, to permit the flow of production process through the shortest possible distance in
the shortest possible time.

The principles of plant layout can be stated as-

1. Integration of all factors - The plant should integrate all the essential resources of men,
machines and materials in order to give an optimum level of production.

2. Minimum Movement - The less the movement of men, machines and materials, the less
will be the cost of production. Thus, minimum movement of theses resources will provide
cost efficiency.

3. Unidirectional flow - All materials should progressively move towards the same direction
i.e. towards the stage of completion. Any back-tracking should be avoided here.

4. Efficient space handling - The space used up during the plant work also costs money as
more the space required, more will be the floor rent. The materials should be organized in
stacks in a proper and recognizable order to maintain space efficiency.

5. Inherent safety - The environment of the plant should be safe for the workers as well as
the machines. There should be fire extinguishers and fire exits placed strategically. There
should be minimum contact of the labour to toxic chemicals and environment.

6. Maximum observation capacity - The layout of the plant should such that all of its
resources and workforce can be observed and evaluated at all points in time. This helps in
better supervision of work and helps in increasing both effectiveness and safety.

65 | P a g e
Notes by HBS
7. Maximum accessibility - The layout of the plant should ensure that all essential
resources are accessible to the labour and machines without any delay. The aisles should
be free from obstacles. The materials should be placed as close,to the machines concerned,
as possible.

8. Minimum Handling - The ineffective handling of materials leads to a rise in cost.

Materials should be handled in stacks and transferred in one go. Handling of a material twice
in the same direction must be avoided.

9. Maximum protection - The layout should ensure the protection of the materials and
machines while they are in the working or the storage stage. The security system should be
efficient without making too many doors or barriers.

10. Maximum flexibility - The plant layout should not be rigid and permanent. If the need
arises, the plant layout should be able to change itself without being expensive.

Q.3. a) Why do we consider the facility location problem as a strategic

decision? What are the major factors in deciding the facility location
problem?

Ans:- Facility location decisions are a critical element in strategic planning for a wide range
of private and public firms. The ramifications of siting facilities are broadly based and long-
lasting, impacting numerous operational and logistical decisions. High costs associated with
property acquisition and facility construction make facility location or relocation projects long-
term investments. To make such undertakings profitable, firms plan for new facilities to
remain in place and in operation for an extended time period. Thus, decision makers must
select sites that will not simply perform well according to the current system state, but that
will continue to be profitable for the facility's lifetime, even as environmental factors change,
populations shift, and market trends evolve. Finding robust facility locations is thus a difficult
task, demanding that decision makers account for uncertain future events. The complexity of
this problem has limited much of the facility location literature to simplified static and
deterministic models. Although a few researchers initiated the study of stochastic and
dynamic aspects of facility location many years ago, most of the research dedicated to these
issues has been published in recent years. In this review, we report on literature which
explicitly addresses the strategic nature of facility location problems by considering either
stochastic or dynamic problem characteristics. Dynamic formulations focus on the difficult
timing issues involved in locating a facility (or facilities) over an extended horizon. Stochastic
formulations attempt to capture the uncertainty in problem input parameters such as forecast
demand or distance values. The stochastic literature is divided into two classes: that which
explicitly considers the probability distribution of uncertain parameters, and that which
captures uncertainty through scenario planning. A wide range of model formulations and
solution approaches are discussed, with applications ranging across numerous industries.

66 | P a g e
Notes by HBS
Facility Location - Factors Influencing
the Location
Facility Location is the right location for the manufacturing facility, it will have sufficient access to
the customers, workers, transportation, etc. For commercial success, and competitive advantage
following are the critical factors:

Overall objective of an organization is to satisfy and delight customers with its product and
services. Therefore, for an organization it becomes important to have strategy formulated around
its manufacturing unit. A manufacturing unit is the place where all inputs such as raw material,
equipment, skilled labors, etc. come together and manufacture products for customers. One of
the most critical factors determining the success of the manufacturing unit is the location.

Facility location determination is a business critical strategic decision. There are several
factors, which determine the location of facility among them competition, cost and
corresponding associated effects. Facility location is a scientific process utilizing various
techniques.

Location Selection Factors

For a company which operates in a global environment; cost, available infrastructure, labor skill,
government policies and environment are very important factors. A right location provides
adequate access to customers, skilled labors, transportation, etc. A right location ensures
success of the organization in current global competitive environment.

67 | P a g e
Notes by HBS
Industrialization

A geographic area becomes a focal point for various facility locations based on many factors,
parameters and issues. These factors are can be divided into primary factors and secondary
factors. A primary factor which leads to industrialization of a particular area for particular
manufacturing of products is material, labor and presence of similar manufacturing facilities.
Secondary factors are available of credit finance, communication infrastructure and insurance.

Errors in Location Selection

Facility location is critical for business continuity and success of the organization. So it is
important to avoid mistakes while making selection for a location. Errors in selection can be
divided into two broad categories behavioral and non-behavioral. Behavioral errors are decision
made by executives of the company where personal factors are considered before success of
location, for example, movement of personal establishment from hometown to new location
facility. Non-behavioral errors include lack of proper investigative practice and analysis, ignoring
critical factors and characteristics of the industry.

Location Strategy

The goal of an organization is customer delight for that it needs access to the customers at
minimum possible cost. This is achieved by developing location strategy. Location strategy helps
the company in determining product offering, market, demand forecast in different markets, best
location to access customers and best manufacturing and service location.

Factors Influencing Facility Location

If the organization can configure the right location for the manufacturing facility, it will have
sufficient access to the customers, workers, transportation, etc. For commercial success, and
competitive advantage following are the critical factors:

Customer Proximity: Facility locations are selected closer to the customer as to reduce
transportation cost and decrease time in reaching the customer.

Business Area: Presence of other similar manufacturing units around makes business area
conducive for facility establishment.

Availability of Skill Labor: Education, experience and skill of available labor are another
important, which determines facility location.

Free Trade Zone/Agreement: Free-trade zones promote the establishment of manufacturing

facility by providing incentives in custom duties and levies. On another hand free trade
agreement is among countries providing an incentive to establish business, in particular, country.

Suppliers: Continuous and quality supply of the raw materials is another critical factor in
determining the location of manufacturing facility.

Environmental Policy: In current globalized world pollution, control is very important, therefore
understanding of environmental policy for the facility location is another critical factor.

Q.3. b) Describe in brief impact of following environmental aspects in design

of plant layout.

68 | P a g e
Notes by HBS
i) Lighting
General information From the workers’ perspective, poor lighting at work can lead to eye strain,
fatigue, headaches, stress and accidents. On the other hand, too much light can also cause health
and safety problems such as “glare” headaches and stress. Both can lead to mistakes at work, poor
quality and low productivity. Various studies suggest that good lighting at the workplace pays
dividends in terms of improved productivity, and a reduction in errors9 . Improvements in lighting do
not necessarily mean that you need more lights and therefore use more electricity – it is often a case
of making better use of existing lights; making sure that all lights are clean and in good condition;
and that lights are positioned correctly for each task. It is also a case of making the best use of
natural light.

Most garment factories have a combination of natural and artificial lighting. However, little attention
appears to be paid on the nature of the work – it is as though all work in the factory requires the
same degree of lighting. As we will see, this is not the case.

Although we have already spoken about the need for shading windows to reduce heat inside the
factory, there is also a need to make sure that all windows, skylights, etc., are clean and in the best
position to allow the maximum amount of natural light into the workplace. Companies can always
use appropriate shading methods for reducing the temperature – they should not rely on the
windows being dirty. Skylights and windows high up the factory walls let in much more light (and air)
than low windows, which often get blocked with stock, raw materials etc. Similarly, all lights (and
reflectors) in the factory should be well maintained and cleaned on a regular basis (especially when
you consider how much dust is released into the atmosphere during each shift)

It has been known for companies, when the order books are low, to introduce “energy saving”
programmes to save costs. In the case of lighting, “non essential” light bulbs may be removed or
reduced in number, flickering fluorescent tubes which need changing are left in place – this proves
to be a false economy as quality and productivity fall. Pictures 32 and 33: Look at the dirt and
cobwebs on the fluorescent light. The reflector has a layer of dust all over it. Clearly the light hasn’t
been cleaned for a long time. In some factories, workers use long handled brooms to clean the
ventilation ducts and the lights. As we will see, this method of cleaning can create other health
problems. One simple way to improve the lighting levels in the factory is to paint the walls and
ceilings with light, pale, matt colours – the use of matt paint avoids reflection of light which can lead
to problems of glare. The colour of equipment such as sewing machines, workbenches, etc., should
normally be matched with that of the walls and again avoid black, shiny paints. By brightening up the
workplace, this helps to produce a more pleasant place to work which impacts on workers’ well-
being and, ultimately, productivity. Find the best place for the light source: It may sound like
common sense, but it is essential for the light to focus on the work in hand and not directly, or
indirectly in to the workers’ eyes. The more detailed the task, the more light that is needed for the
workers to carry out the job efficiently.

It has been known for companies, when the order books are low, to introduce “energy saving”
programmes to save costs. In the case of lighting, “non essential” light bulbs may be removed or
reduced in number, flickering fluorescent tubes which need changing are left in place – this proves
to be a false economy as quality and productivity fall. Pictures 32 and 33: Look at the dirt and
cobwebs on the fluorescent light. The reflector has a layer of dust all over it. Clearly the light hasn’t
been cleaned for a long time. In some factories, workers use long handled brooms to clean the

69 | P a g e
Notes by HBS
ventilation ducts and the lights. As we will see, this method of cleaning can create other health
problems. One simple way to improve the lighting levels in the factory is to paint the walls and
ceilings with light, pale, matt colours – the use of matt paint avoids reflection of light which can lead
to problems of glare. The colour of equipment such as sewing machines, workbenches, etc., should
normally be matched with that of the walls and again avoid black, shiny paints. By brightening up the
workplace, this helps to produce a more pleasant place to work which impacts on workers’ well-
being and, ultimately, productivity. Find the best place for the light source: It may sound like
common sense, but it is essential for the light to focus on the work in hand and not directly, or
indirectly in to the workers’ eyes. The more detailed the task, the more light that is needed for the
workers to carry out the job efficiently

ii) Ventilation
Ventilation General information It is not only essential to provide a comfortable temperature inside
the factory, you must ensure; • an adequate supply of fresh air; • the removal of stale air; and 5
Wet-bulb temperature is measured by a thermometer in which the bulb is covered by a whetted
wick, effectively shielded from radiation and exposed to a current of rapidly moving air. Dry-bulb
temperature is a measure of air temperature by an ordinary thermometer and shielded from radiant
heat. REMEMBER: It is important to know the humidity inside the factory. If the factory is very hot
and humid, the process of sweating is not effective and the workers are in danger of over heating. •
the prevention of any build up of contaminants (dust, spot cleaning chemicals, etc). It is important
not to confuse ventilation and air circulation inside the factory. What we tend to see inside many
garment factories is air circulation, namely moving the air around inside the factory without
renewing it with fresh air from outside. In the case of air circulation, fans are placed near workers
(see picture 24) to improve thermal comfort and, in some cases, remove dust. In essence this means
that you are simply circulating stale air plus any contaminants around the factory. Ventilation refers
to replacing stale air (plus any contaminants) with fresh air (or purified air in the case of air
conditioners) at regular intervals. In an average workplace, the air needs to be changed between 8

70 | P a g e
Notes by HBS
and 12 times per hour and that there should be at least 10 cubic meters of air per worker6 . Many
Cambodian garment factories rely on the principle of general ventilation by allowing the free flow of
air through the factory from one side to the other – referred to as horizontal air-flow. This can be
achieved by opening doors and windows and putting more air bricks in the walls to take advantage
of any prevailing wind. However it is all to common to find doors and windows etc., locked for
security reasons or blocked with excess stock or boxes of finished goods awaiting export. As a result,
ventilation is limited. If you are trying to improve the general ventilation in your factory, here are a
few simple suggestions that can help: • if you have ventilation systems or free standing fans in the
factory, make sure that they increase the natural flow of air through the factory and not try to blow
air against any prevailing wind (see picture 25); • ensure that hot, stale air that rises to the factory
roof can easily be removed and replaced with fresh air (see picture 26); • make sure that all fans are
well maintained and regularly cleaned so that they work efficiently; • ensure that the air-flow to and
from fans is not blocked (see picture 27); • try to ensure that any “hot” processes such as the ironing
section is sited next to the “down wind” wall so that the heat is extracted directly outside rather
than being spread around the factory.

In cases where there is a build up of contaminants or heat in specific areas of the factory, local
exhaust ventilation has to be used to remove the hazard. This type of ventilation uses suction and
hoods, ducts, tubes etc to remove the hazard as close to the source as possible and extract it to the
outside environment. It works on a principle similar to that of a vacuum cleaner but on a much larger
scale.

iii) Dust Control

Dust control 5.1 Wherever possible, dust or vapour contamination should be removed at source.
Point-of-use extraction, i.e. as close as possible to the point where the dust is generated, should be
employed. Spot ventilation or capture hoods may be used as appropriate. 5.2 Point-of-use extraction
should be either in the form of a fi xed high velocity extraction point or an articulated arm with
movable hood or a fi xed extraction hood. 5.3 Dust extraction ducting should be designed with suffi
cient transfer velocity to ensure that dust is carried away, and does not settle in the ducting. Periodic
checks should be performed to ensure that there is no build up of the dust in the ducting. 5.4 The
required transfer velocity should be determined: it is dependent on the density of the dust (the
denser the dust, the higher the transfer velocity should be, e.g. 15–20 m/s). 5.5 Airfl ow direction
should be carefully chosen, to ensure that the operator does not contaminate the product, and also
so that the operator is not put at risk by the product. 246 5.6 Point extraction alone is usually not
suffi cient to capture all of the contaminants, and general directional airfl ow should be used to
assist in removing dust and vapours from the room. 5.7 Typically, in a room operating with turbulent
airfl ow, the air should be introduced from ceiling diffusers, located at the door entry side of the
room and extracted from the rear of the room at low level to help give a fl ushing effect in the room.
Correct fl ushing of the rooms may be verifi ed by airfl ow visualization smoke tests. 5.8 When
dealing with particularly harmful products, additional steps, such as handling the products in glove
boxes or using barrier isolator technology, should be used. 6. Protection of the environment 6.1
General 6.1.1 It should be noted that protection of the environment is not addressed in this
guideline, and discharges into the atmosphere should be compliant with relevant local and national
environmental legislation and standards. 6.1.2 Dust, vapours and fumes could be possible sources of
contamination; therefore, care should be taken when deciding on the location of the inlet and
exhaust points relative to one other. 6.2 Dust in exhaust air 6.2.1 Exhaust air discharge points on

71 | P a g e
Notes by HBS
pharmaceutical equipment and facilities, such as from fl uid bed driers and tablet-coating
equipment, and exhaust air from dust extraction systems, carry heavy dust loads and should be
provided with adequate fi ltration to prevent contamination of the ambient air. 6.2.2 Where the
powders are not highly potent, fi nal fi lters on a dust exhaust system should be fi ne dust fi lters
with a fi lter classifi cation of F9 according to EN 779 fi lter standards. 6.2.3 Where reverse-pulse
dust collectors are used for removing dust from dust extraction systems, they should usually be
equipped with cartridge fi lters containing a compressed air lance, and be capable of continuous
operation without interrupting the airfl ow. 6.2.4 Alternative types of dust collectors (such as those
operating with a mechanical shaker, requiring that the fan be switched off when the mechanical
shaker is activated) should be used in such a manner that there is no risk of cross-contamination.
There should be no disruption of airfl ow during a production run as the loss of airfl ow could disrupt
the pressure cascade. 247 6.2.5 Mechanical-shaker dust collectors should not be used for
applications where continuous airfl ow is required, in order to avoid unacceptable fl uctuations in
room pressures, except in the case where room pressures are automatically controlled. 6.2.6 When
wet scrubbers are used, the dust-slurry should be removed by a suitable means, e.g. a drainage
system or waste removal contractor. 6.2.7 The quality of the exhaust air should be determined to
see whether the fi ltration effi ciency is adequate with all types of dust collectors and wet scrubbers.
6.2.8 Where necessary, additional fi ltration may be provided downstream of the dust collecto

OR

Dust control touches every part of an aggregate operation, from productivity, efficiency, and
product quality to compliance, safety, and good neighbor relations. According to Mark
Kestner, Ph.D., president and CEO of National Environmental Service Co. (NESCO), “My
philosophy has always been that good dust control is good process control. If your stone isn’t
spilling on the ground or going up in the air, it’s going across a scale and into a truck, railcar,
or barge to make money.”

Dust in aggregate operations comes from three major source categories: roads, stockpiles, and
processing operations. The most significant causes of dust from an operations standpoint
include mobile equipment on unpaved roads, crusher discharge, screen discharge, conveyor
transfer points, and stacking conveyor discharge, says Clif Morris, general manager of
aggregates for Tilcon New York.

Engineered controls that are employed to contain dust and spillage should be an integral part
of plant design, Kestner says. “Any owner/operator of a new mine is required by federal and
state laws to obtain permits to construct, install, and operate the facility. As part of the
permitting process, the mine must specify the dust controls it will use and must demonstrate
that it is able to comply with NSPS (New Source Performance Standards).”

As part of the design, transfer points should be enclosed on three sides, covered, fitted with a
dust curtain, and properly skirted. Load points should have sufficient idler support to prevent
sagging between idlers that leads to visible dust and spillage. “I see more and more plants

72 | P a g e
Notes by HBS
using impact beds to maintain uniform seals at load points and dual skirting at impact crusher
discharges,” Kestner notes.

Kestner and Morris agree that the following steps are required when developing a dust
control plan:
1. Conduct a site survey to identify all the sources of dust on the property.
2. Estimate “uncontrolled” dust emissions from these sources using EPA AP-42 emission
factors; this provides a baseline to evaluate the performance of controls.
3. Specify Reasonably Available Control Measures (RACM) for each dust source.
4. Estimate “controlled” emissions using control efficiency ratings established by federal or
state EPAs.
5. Establish a budget to purchase and install dust controls.
6. Implement the control plan.
7. Monitor the performance of the control plan and modify as necessary to maintain
compliance.

Companies that ignore engineered controls to reduce the costs of new plant construction will
pay for it later in time and labor to clean up dust and spillage. Additionally, when laborers
have to sweep, shovel, or use a skid steer to remove spillage out from under screens,
conveyors, and crushers, they are at their greatest risk for exposure to respirable dust.

iv) Humidity
relative humidity The ratio of the actual water vapour pressure of the air to the saturated water
vapour pressure of the air at the same temperature expressed as a percentage. More simply put, it is
the ratio of the mass of moisture in the air, relative to the mass at 100% moisture saturation, at a
given temperature.

The relative humidity of the room where the product is exposed should be considered a critical
parameter when a humidity-sensitive product is being manufactured. The humidity sensors and the
humidity monitoring system should, therefore, be qualifi ed. The heat transfer system, chemical
drier or steam humidifi er, which is producing the humidity controlled air, is further removed from
the product and may not require operational qualifi cation. • A room cleanliness condition is a
critical parameter and, therefore, the room air change rates and HEPA fi lters should be critical
parameters and require qualifi cation. Items such as the fan generating the airfl ow and the primary
and secondary fi lters are non-critical parameters, and may not require operational qualifi cation.

Temperature and relative humidity 4.9.1 Where appropriate, temperature and relative humidity
should be controlled, monitored and recorded, where relevant, to ensure compliance with
requirements pertinent to the materials and products and provide a comfortable environment for
the operator where necessary. 4.9.2 Maximum and minimum room temperatures and relative
humidity should be appropriate. Alert and action limits on temperatures and humidities should be

73 | P a g e
Notes by HBS
 set, as appropriate. 4.9.3 The operating band, or tolerance, between the acceptable minimum and
maximum temperatures should not be made too close. Tight control tolerances may be diffi cult to
achieve and can also add unnecessary installation and running costs. 4.9.4 Cubicles, or suites, in
which products requiring low relative humidity are processed, should have well-sealed walls and
ceilings and should also be separated from adjacent areas with higher relative humidity by means of
suitable airlocks. 4.9.5 Precautions should be taken to prevent moisture migration that increases the
load on the HVAC system. 4.9.6 Humidity control should be achieved by removing moisture from the
air, or adding moisture to the air, as relevant. 4.9.7 Dehumidifi cation (moisture removal) may be
achieved by means of either refrigerated dehumidifi ers or chemical dehumidifi ers. 4.9.8
Appropriate cooling media for dehumidifi cation such as low temperature chilled water/glycol
mixture or refrigerant should be used. 4.9.9 Humidifi ers should be avoided if possible as they may
become a source of contamination (e.g. microbiological growth). Where humidifi cation is required,
this should be achieved by appropriate means such as the injection of steam into the air stream. A
product-contamination assessment should be done to determine whether pure or clean steam is
required for the purposes of humidifi cation. 4.9.10 Where steam humidifi ers are used, chemicals
such as corrosion inhibitors or chelating agents, which could have a detrimental effect on 245 the
product, should not be added to the boiler system. Only appropriate additives should be added to
the boiler system. 4.9.11 Humidifi cation systems should be well drained. No condensate should
accumulate in air-handling systems. 4.9.12 Other humidifi cation appliances such as evaporative
systems, atomizers and water mist sprays, should not be used because of the potential risk of
microbial contamination. 4.9.13 Duct material in the vicinity of the humidifi er should not add
contaminants to air that will not be removed by fi ltration further downstream. 4.6.14 Air fi lters
should not be installed immediately downstream of humidifi ers, as moisture on the fi lters could
lead to bacterial growth. 4.9.15 Cold surfaces should be insulated to prevent condensation within
the clean area or on air-handling components. 4.9.16 When specifying relative humidity, the
associated temperature should also be specifi ed. 4.9.17 Chemical driers using silica gel or lithium
chloride are acceptable, provided that they do not become sources of contamination.

OR

Humidity control systems add or remove water vapor from indoor air to stay within
proper humidity ranges.

Humidity control is important for three reasons:

1. It is a large factor in people's thermal comfort.

2. Excess moisture in a building can lead to mold and mildew, causing problems for indoor air quality.
3. It is a large energy user. Dehumidification alone can be a quarter to a third of cooling energy in
humid climates or seasons. (However, humidifying does not tend to be a large energy load, even in
dry climates or seasons.)
Humidity is most often measured by relative humidity, which is the ratio of moisture in
the air to the maximum possible saturation of air at a given temperature. The warmer
the air is, the more water vapor it can hold. Absolute humidity is the actual amount of
water molecules in the air.

74 | P a g e
Notes by HBS
Psychrometric charts can help plot absolute and relative humidity data alongside
temperature for your site to help you understand how much humidity control you
might need in your design. The horizontal lines are absolute humidity, while relative
humidity is shown in the curved lines, from 10% at the lowest to 100% (the
dewpoint) at the upper left edge of the graph.

Low and high humidity shown in a psychometric chart

The energy efficiency of dehumidification is measured by a device's "energy
factor". This is the liters of water removed from the air per kWh of energy consumed.
A higher energy factor means greater efficiency, with performance ranging from 1
L/kWh to over 4 L/kWh.

Comfort and Health

Comfortable humidity ranges vary by temperature (the hotter the temperature, the
less humidity is comfortable), but are generally between 35% - 50% relative
humidity. See Human Comfort for details.
To avoid mold growth, it’s ideal to keep humidity levels below 40%. Also be sure that
shower, laundry, and cooking areas are well-ventilated.

Controls
To keep humidity within comfort ranges, the building's thermostats should have
humidity sensors in them. If they do not, you can specify
separate hygrometer systems that can control humidifiers and dehumidifiers

75 | P a g e
Notes by HBS
separately from the rest of the HVAC system. However, both comfort and energy
efficiency will be better when humidity control is integrated with temperature
control.

Q.4. b) Explain various technical and economical considerations for

equipment replacement.

Ans:- Many companies have equipment used in production and testing that needs to be
regularly maintained or replaced. A large defense contractor, Company X, has many
advanced pieces of production equipment that support its operations. These pieces of
production equipment operate in conjunction with support equipment. Breakdowns can cause
a variety of issues. In some cases, they occur in support equipment when the production
equipment is not in use. Lead times in obtaining replacement parts or extended repair time
can cause outages that delay production, and result in missed deadlines. These can have
severe impacts in the short- term for lost award money from current contracts, and in the
long-term will reduce the number of contracts and programs. Company X has requested a
review and recommendations on the current support equipment maintenance and replacement
processes to prevent excess work or costly breakdowns.

OR

Determining when a piece of equipment has reached the end of

its useful life cycle in the company’s overall reliability strategy
can often be difficult if not looked at in the proper perspective.
This is especially true in today’s business environment where
the impetus is placed on the reduction of manufacturing cost
and improving overall plant reliability. After all, equipment
reliability directly relates to profitability and in the end, overall
customer satisfaction - the only true indicator for increasing
profitability.
Often the main consideration for the modernization of plant
equipment is the capital expenditure. In essence, can we afford
new equipment or not, with little or no consideration actually
given for lowering life-cycle cost or increasing operational
effectiveness much less the capabilities of existing equipment?
Buying new equipment may be the quick choice but it may not
be the right choice.
So how do we know when equipment has actually reached, or
is approaching, the end of its useful life cycle. The key is not
the age of existing equipment, but its condition. Plant
equipment may be old from the standpoint that it was
purchased many years ago. However, most equipment has
been continually upgraded and maintained in order to keep up

76 | P a g e
Notes by HBS
with evolving manufacturing and production requirements.
Consideration for replacement should not emphasize the
capabilities of the equipment when initially specified and
purchased, but its capabilities and reliability in its existing
current configuration. With all this taken into account there are
but a few actual reasons to change or replace equipment.
First and foremost is safety. This is a “no brainer.” When the
equipment presents an unacceptable safety risk to the plant,
plant personnel or the environment - replace it! In a worse
case scenario there could be loss of life or an environment
incident. This is not only tragic all by itself, but can have even
more catastrophic effects on an organization or even an entire
industry. The consequences of choosing not to replace
equipment for safety issues can represent not only huge
financial losses, but even more important the loss of customer
and public confidence. However, even considering a worse case
situation, consideration must first be given to the possibility of
upgrading the equipment in order to achieve an acceptable
safety margin.
Another legitimate reason for replacing equipment is that it is
no longer cost effective to maintain. This not only includes any
changes in the original features of the equipment but also
externally imposed changes such as those required by new
governmental legislations (stack emission levels, waste
disposal requirements, noise levels, etc.) In addition,
maintenance cost associated with maintaining an acceptable
equipment reliability level may be far too expensive or the cost
and or availability of spare parts could become unacceptable
from a business standpoint.
Obviously when the equipment can’t meet customer specs it is
no longer viable to keep producing. Here the question becomes
can the customers’ specs be changed. It is not unusual for the
customer to ask for product produced to a tighter tolerance
than actually required for their intended use. This is like an
insurance policy to ensure that the product they purchase will
meet their specific requirements. There is nothing wrong with
approaching the customer to see if something can be worked
out to relieve unnecessarily stringent requirements. Many
times the customer does not know, nor intends to make
production requirements more difficult for the manufacturer.
This is especially true with customers and manufacturers that
have long profitable working relationships. Each needs the

77 | P a g e
Notes by HBS
other and both will typically be sympathetic to the concerns of
the other.
The final reason for replacing equipment is that it can’t meet
production requirements. Every organization in the world is
looking for ways to reduce manufacturing costs while at the
same time increasing production. When the equipment can’t
meet production requirements in terms if either throughput or
manufacturing cost it should be replaced. Here the caution is
not to just buy new equipment, but to do a detailed study of
the reliability of the new equipment. There should be a life-
cycle reliability strategy developed and adhered to at every
stage from initial conception to decommissioning.
The term reliability is no longer just a “buzz word” in the
manufacturing sector but a way of life. The strategy of
replacing old equipment with new more reliable equipment is
certainly within the realm of our new reliability life style
provided it is well thought out and makes financial sense.
About the Author

Mr. Hughes, a mechanical engineer, is a member of the

American Society of Mechanical Engineers (ASME) & the
American Society of Training and Development (ASTD). He is
currently a Senior Training and Reliability Consultant with
Reliability Center, Inc

OR

The Equipment Replacement Decision

The parts replacement decision, to replace a piece of
equipment should be based on facts and figures.
The judgment which the owner-manager of a small
company makes should be the result of weighing the
costs of keeping the old equipment against the cost of
its replacement.
This parts replacement guide discusses the elements
involved in making such a cost comparison.
Examples are used to illustrate the gathering and use
of the appropriate cost figures.
300x250
78 | P a g e
Notes by HBS
Sooner or later, you must decide whether you should
keep an existing unit of equipment or replace it with a
new unit. As time goes by, equipment deteriorates and
becomes obsolete. Frequent breakdowns occur,
defective output increases, unit labor costs rise, and
production schedules cannot be met. At some point,
these occurrences become serious enough to cause you
to wonder whether or not you should replace the
equipment.
The problem is that the new equipment costs money,
and the question that comes to you is: Will the
advantages of the new equipment be great enough to
justify the investment it requires?
You answer this question by making a cost comparison.
To recognize the better alternative you need to know
the total cost of each alternative - keeping the old
equipment or buying a replacement. Once these costs
are determined, you can compare them and identify
the more economical equipment. The paragraphs that
follow discuss the individual costs which you must
consider when computing the total cost of the old and
new equipment.
300x250
Depreciation
One of the costs connected with any type of equipment
is depreciation. For cost comparison purposes,
depreciation is simply the amount by which an asset
decreases in value over some period of time. For
example, if you bought a piece of equipment for
$20,000 and sold it for $6,000 after seven years of
service, you would say that the depreciation during the
seven-year period was $20,000 minus $6,000, or

79 | P a g e
Notes by HBS
$14,000. This $14,000 was one of your costs of owning
the equipment for that period.
From this, it follows that when considering equipment
replacement, you must calculate the future
depreciation expense that you will experience with both
the old and the new equipment.
Insofar as the new equipment is concerned, this calls
for knowing certain things about the equipment. You
need to know (1) its first cost, (2) its estimated service
life, and (3) its expected salvage value. The difference
between the first cost and the salvage value will
represent the amount by which the equipment will
depreciate during its life - that is, during the time you
expect to use it.
Vertcal Links
You determine the depreciation expense for the old
equipment in the same general way but for one import
difference. The difference is that no expenditure is
required to procure the equipment because you already
own it. However, a decision to keep it does require an
investment at the present time. This investment is
equal to the asset's market value - that is, to the
amount of money the asset would bring in if it were
replaced and sold. If this amount is not equal to the
equipment's book value. the depreciation expense that
was shown for accounting purposes is in error because
it did not reflect the actual depreciation.
So to determine the actual future depreciation expense
that will be experienced with the old equipment, you
must know (1) its present market value, (2) its
estimated remaining service life, and (3) its expected
salvage value at the end of that life. The difference

80 | P a g e
Notes by HBS
between the present market value and the future
salvage value represents the amount by which the
equipment will depreciate during its remaining life in
your business.
Vertcal Links
To sum up, you must begin your cost comparison by
determining the first cost of the new equipment and
estimating its service life and salvage value. Also, you
must determine the market value of the old equipment
and estimate its remaining service life and future
salvage value.
Interest
In addition to depreciation, every piece of equipment
generates an interest expense. This expense occurs
because owning an asset ties up some of your capital.
If you had to borrow this capital you would have to pay
for the use of the money. This "out-of-pocket" cost is
one of the costs of owning the equipment.
The story is the same even when you use your own
money. In this case, the amount involved is no longer
available for other investments which could bring you a
return. This "opportunity cost" is one of the costs of
owning the equipment.
To cite an example, suppose that the market value of
an asset during a given year is $10,000. Suppose also
that at the same time, you are getting capital at a cost
of 15 percent per year. On the other hand, suppose
that if you converted the asset into cash, you could
invest the money and realize a rate of return of 15
percent per year. In either case, a decision to own that
asset during that year would be costing you 15 percent
of $10,000, or $1,500 in interest.

81 | P a g e
Notes by HBS
Vertcal Links
Thus, in any comparison of equipment alternatives, you
must take the cost of money into account. So, when
determining whether or not existing equipment should
be replaced, you must estimate what money is costing
you in terms of a percent per year.
Operating Costs
There is a third type of cost - the cost of operation -
that is experienced with a piece of equipment. Typical
operating cost are expenditures for labor, materials,
supervision, maintenance, and power.
These cost must be considered because your choice of
equipment affects them. You may find it convenient to
estimate these costs on an annual basis. You can get
figures for each unit of equipment by estimating its
next-year operating costs as well as the annual rate at
which these costs are likely to increase as wage rates
rise and the equipment deteriorates.
For example, you might say that operating cost for the
new equipment are likely to be $16,000 during the first
year of its life. You might also estimate that after the
first year, the operating costs will increase at a rate of
$500 a year.
You can simplify the problem of estimating these costs
by either (1) ignoring those costs that are the same for
the old and the new equipment or (2) estimating only
the differences between the operating costs of the two
units. With this simplification, the total costs which you
calculate for each type of equipment will be
understated by the same amount. Therefore, the
difference between these total costs will remain the
same, and you will still be able to recognize the more

82 | P a g e
Notes by HBS
economical alternative.
Revenues
Often, the revenues generated by the old and the new
equipment will be the same. When this is true,
revenues can be ignored for the same reason that you
can ignore equal operating costs.
But if revenues are affected by the choice of
equipment, they must be considered. For example, you
might estimate that the higher quality of output from
the new equipment will increase annual sales by
$1,200. You can handle this difference in revenues in
either of two ways.
One way is to show the $1,200 as an additional annual
cost that will be experienced with the old equipment.
The other way is to treat the $1,200 as a negative
annual cost and associate it with the new equipment.
The total cost which you calculate will be affected by
your choice of method, but the difference between
these cost will remain the same.
An Annual Average Cost
In brief, you can make the necessary cost analysis on
the new and old equipment only after you have the
proper data for each. For the new equipment, the data
include first cost, service life, salvage value, operating
costs, and revenue advantage. For the old equipment,
the data include market value, remaining service life,
future salvage value, and operating costs. In addition,
for both alternatives, the cost of money must be stated
in the form of an interest rate.
By using these data, you can determine the elements
of the total costs. These elements consist of
depreciation expense, interest expense, operating

83 | P a g e
Notes by HBS
costs, and possibly lost revenues. Now, it so happens
that these costs can be expressed in a variety of ways.
However, the simplest way for cost comparison
purposes is to describe these cost elements in terms of
an average annual cost. Doing so permits you to
calculate and compare the total average annual costs
of the old and new equipment and reach a decision.
How these costs can be computed is shown in the
example that follows.
The Old Equipment
Look first at some facts about an old piece of
equipment. It has a market value of $7,000. If
retained, its service life is expected to be four years,
and its salvage value is expected to be $1,000. Next-
year operating costs are estimated to be $8,000 but
will probably increase at an annual rate of $200. The
cost of money is 12 percent per year. With this set of
figures, you can obtain the total average annual cost of
the alternative of keeping this equipment.
Annual Depreciation Expense. You begin by
calculating the equipment's average annual
depreciation expense. You do this by determining the
total depreciation and dividing that amount by the
asset's four-year life. Your answer is $1,500 which you
get as follows:
Annual depreciation =
$7,000 - $1,000
________________ = $1,500
4
Annual Interest Expense. Next, you calculate the
average annual interest expense. The maximum
investment in the equipment is $7,000, its present

84 | P a g e
Notes by HBS
market value. But as time goes by, the investment in
the asset decreases because its market value
decreases. The minimum investment is reached at the
end of the equipment's life when it has a salvage value
of $1,000. The average investment will be the average
of these maximum and minimum values. You calculate
it
Q5. A) Highlight importance of safety considerations in design of plant
playout.

Ans:- Plant layout design for safety aspect

1. A PRESENTATION ON PLANT LAYOUT DESIGN FOR SAFETY ASPECT
ENVIRONMENTAL ENGINEERING AND SCIENCES ANURAG SINGH
MT/ENV/10005/2013 2ST SEMESTER
2.  Plant layout refers to the arrangement of physical facilities such as
machinery, equipment, furniture. within the factory building in such a manner so
as to have quickest flow of material at the lowest cost and with the least amount
of handling in processing the product from the receipt of material to the
shipment of the finished product.
3.  Meet quality and capacity requirement in the most economical
manner  Minimize unit costs and optimize quality  Promote effective use of
people, equipment, space and energy  Provide for employee safety and comfort
 Control project costs  Achieve production deadlines
4.  New site development or addition to previously developed site. 
Type and quantity of products to be produced,  Possible future expansion, 
Operational convenience and accessibility,  Type of process and product
control,  Economic distribution of utilities and services,
5.  Type of building and building code requirements,  Guidelines
related to health and safety,  Waste-disposable problems,  Space available
and space requirement,  Auxiliary equipment, and  Roads and railroad.
6. Accidents (%) 44 Process Design 22 12 11 5 5 1 Mechanical Operator
Error Unknown Process Upsets Natural Hazards Design Sabotage and Arson
7. Procedure of Plant Layout Design Information Gathering Determine
what will be produced Determine how many will be produced Determine what
components will be made or purchased Determine required operations Determine
sequence of operations Production and Flow Analysis Determine the plant rate
Determine the number of machines Study the flow requirement Determine activity
85 | P a g e
Notes by HBS
 relationships Support Services Identify needs for personal and plant services

Identify office needs Develop total space requirements

8. EQUIPMENT LAYOUT METHOD STRAIGHT LINE FIXED POSITION LAYOUT

COMBINED LAYOUT

9. FLOW CHART OF LINE LAYOUT

10. Raw Mat. Forging Press Forging Press Gear Cutting Machine Gear

cutting Machine Gear cutting Machine Heat Treatment Heat Treatme nt Gear

Grinding Machine Gear Grinding Machine F i n i s h e d O u t p u t

11.  Prevent, limit and mitigate escalation of adjacent events  Ensure

safety within on-site occupied buildings  Control access of unauthorized

personnel  Facilitate access for emergency services

12. Fig. Steps of a safety and risk analysis

13. General Control Facilities Location of Buildings and Structures Flow

Sheet Escape Layout of Equipment Electrical Equipment PLANT LAYOUT FOR

SEAFTY Ventilation, Heating and Air Conditioning Storage Receiving and

Dispatching Road and footpaths Transportation system Railway Parking Areas

14. An ideal plant layout should provide the optimum relationship among

output, floor area and manufacturing process. It facilitates the production process,

minimizes material handling, time and cost, and allows flexibility of operations,

easy production flow, makes economic use of the building, promotes effective

utilization of manpower, and provides for employee’s convenience, safety, comfort

at work, maximum exposure to natural light and ventilation. It is also important

because it affects the flow of material and processes, labor efficiency, supervision

and control, use of space and expansion possibilities

15.  Plant location and layout by Abha Kumar  Bausbacher, E.F. &

Hunt, R.W. 1993. Process Plant Layout and Piping Design. Englewood Cliffs: Prentice Hall.

 Inherent safety in process plant design by AnnaMari Heikkilä  Indian standard for

Industrial plant layout - code of safe Practice  Principles of Inherent Safe Design by Jo

Fearnley.

Q.6. b) Write short note on-Production Flow Analysis

Ans:- Production flow analysis (PFA) is a well-established

methodology used for transforming traditional functional layout
into product-oriented layout. The method uses part routings to
find natural clusters of workstations forming production cells
able to complete parts and components swiftly with simplified

86 | P a g e
Notes by HBS
material flow. Once implemented, the scheduling system is
based on period batch control aiming to establish fixed
planning, production and delivery cycles for the whole
production unit. PFA is traditionally applied to job-shops with
functional layouts, and after reorganization within groups lead
times reduce, quality improves and motivation among
personnel improves. Several papers have documented this, yet
no research has studied its application to service operations
management. This paper aims to show that PFA can well be
applied not only to job-shop and assembly operations, but also
to back-office and service processes with real cases. The
cases clearly show that PFA reduces non-value adding
operations, introduces flow by evening out bottlenecks and
diminishes process variability, all of which contribute to efficient
operations management.

Production Flow Analysis (PFA)

• method of grouping part into families
• used to analyze the operation steps and machine routes for the parts
produced
• groups parts with similar or identical routings together
• these groups can be used to form logical machine cells in a GT layout
• uses manufacturing data rather than design data to make groups, so
takes care of the problem of:

parts whose basic geometry may differ but might take same or similar
process routes parts whose basic geometry may be same or similar but
require different process

routings

• disadvantage:

takes the route details the way they are, no check for optimal, consistent
or logical routing

87 | P a g e
Notes by HBS
 Production Flow Analysis: Procedure there will be packs that do not fit into similar
groupings these parts can be analyzed to determine if a revised process sequence can be
developed which fits into one of the groups if not possible, then these parts continue to be
manufactured through a conventional process-type plant layout weakness of PFA is that the
data used in the analysis is derived from route sheets, prepared by different process
planners => routings may contain unnecessary and non-optimal steps => final groupings may
be sub-optimal requires less time to perform than a complete parts classification and coding
procedure.

Composite Part Concept • A Composite Part for a given family, which includes all of the
design and manufacturing attributes of the family • an individual part in the family will have
some of the features that characterize the family but not all of them • composite part
possesses all of the features.

Q.7. Write Short notes on:

88 | P a g e
Notes by HBS
a) Computer Aided Plant Layout

89 | P a g e
Notes by HBS
 90 | P a g e
Notes by HBS
 c) Plant Services
There are many different types of work done in a typical plant or facility, including operations
work, preventive maintenance, demand work, reactive maintenance, capital projects, corrective
maintenance, inspections, and janitorial services. Indeed, maintainers and technicians are asked
to do a wide variety of tasks. They’re cross-trained in multiple disciplines, across multiple
departments, and for many bosses. However, there are ways to simplify and, in turn, better
manage how work is initiated for maintainers.

Work is work
There’s no doubt we’re moving toward a world where “work is work,” especially for highly
automated and asset-intensive operations such as oil and gas, process manufacturing, and
utilities. Operations, for example, is becoming less about operators actually touching the product
and more about monitoring and adjusting the equipment that handles the product. Why not have
this work done by maintainers, as well, especially given a technician’s superior understanding of
the consequences of incorrectly operating the equipment? As well, an operator/maintainer can
react immediately to an off-spec situation or equipment downtime, thereby maximizing asset
availability.

Although work is work, it’s still useful to characterize work as either maintenance or non-
maintenance work. These are further subdivided as described below, each with a different
mechanism for work initiation. Note that 100% of work done by maintainers and contractors
should be planned, regardless of work type. The percent breakdown of work types is critical to
understand and optimize.

Maintenance work
Most maintenance work can be anticipated, and therefore work plans on the CMMS can be
created well in advance. Work plans outline work procedures, performance and quality
standards, spare parts and special tools required, safety procedures, and relevant technical
drawings. Once maintenance work is initiated, the most appropriate work plan can be attached or
a work request can be auto-filled for approval and scheduling. If necessary, the work request can
be edited to fit the current situation.

There are only three ways maintenance work is initiated as listed below. Work plans can and
should be created for all of them. Work can be executed by maintainers or external contractors,
and both should be tracked separately using the CMMS.

1. Fail-based maintenance (FBM): Work is initiated as a result of deliberately running an asset

to failure. Although it isn’t certain when failure will occur for a given asset, there may be sufficient
work history on the CMMS or from the original equipment manufacturer (OEM) such that failure
can be forecasted with a reasonable degree of accuracy. When failure occurs, ideally a work
plan is available on the CMMS; otherwise a one-off work request is initiated.

2. Condition-based maintenance (CBM): Work is initiated when a given condition exhibits a

specific pattern or hits an upper or lower control limit. With CBM, inspections are required to
assess the asset’s condition constantly, from on-line real-time inspections using plant automation
equipment to visual inspections by maintainers at regular intervals. Work plans are appropriate
for both the inspections, and any actual maintenance work is triggered. In some cases, work
plans can allow for a reasonable expectation of maintenance work to be done during an
inspection. For example, a route work order for inspecting 30 fire extinguishers in a building can
also include a work plan that anticipates adjusting or topping up at least one of them, based on
work history.

3. Use-based maintenance (UBM): Work is initiated based on usage, including a time period,
such as monthly; meter reading, such as every 3,000 miles driven; or event, such as every snow

91 | P a g e
Notes by HBS
 storm. Once work is triggered by usage as defined in the CMMS, the pre-defined work plan is
automatically pulled into a work request and queued for approval, or scheduling if pre-approved.

The three simple terms, FBM, CBM, and UBM, replace the myriad buzzwords that circulate
throughout industry, such as preventive, proactive, predictive, reactive, and elective
maintenance. There is little consensus on what these expressions mean, thereby causing
considerable confusion regardless of your industry. For example, one of the most common
expressions is preventive maintenance (PM). Try this simple test in your company to gauge the
level of understanding of what is included in the definition of PM. Ask people whether the
following would be considered PM:
• taking your car in to change the oil every three months
• when changing the oil, conducting a 30-point inspection that covers lights, brakes, tire pressure,
and fluids
• when conducting the 30-point inspection, the mechanic replaces your brake pads
• asking the mechanic to replace one of the lamps that you know is out, while your car is in for the
oil change and inspection

Some will say all of this is PM, some just the first bullet, and some all but the bulb replacement.
However, with more simplified terms, the first bullet is UBM since it is maintenance triggered by
time. The second bullet is clearly an inspection, which is a necessary component of and
precursor to CBM. The third bullet reflects the result of an inspection — brake pads are worn
down to a lower control limit triggering condition-based maintenance work to replace the pads.
The fourth bullet is FBM triggered by the failure of the light bulb.

d) Rank Order Clustering

Rank order Clustering

a) This method automates the cluster study by computing Binary weights from a
machine – part matrix

b) It orders parts and machine cells ‘automatically’ by structuring and computing the
matrix with binary weights

c) It implies a computer algorithm for solving the clustering problem

d) It may not solve if machines are needed by more than one family – forces
intelligence in application and hand scanning after several ordering iterations

Rank Order Clustering Method:

1. For each row of the machine/part matrix (M/P/M) read the pattern of cell entries as a
binary word. Rank the rows by decreasing binary value. Equal values stay in same
order.

2. Ask if newly ranked rows in the matrix are the same as previous order? – Yes (STOP) No
(continue)

3. Re-form the M/P/M with rows in new descending order. Now rank the columns by
decreasing binary word weight. Columns of equal weight are left where they are

4. Are current column weights the same as current column order? Yes (STOP), No
(continue)

92 | P a g e
Notes by HBS
 5. Re-form the matrix column order per rank order (highest to left) and return to #1.

Issues in Clustering:

 R/O clustering oscillations indicating need of machine replication (happens often!)

 Presence of Outliers and/or Voids in the finished clusters

 Outliers indicate the need of machine replication

 Voids indicate ‘skipped’ machines in a cell

 Generally speaking, these clustering algorithms are designed to convert existing routes
for facility re-organization

 They require a previous engineering study to be performed to develop a

series of routers on a core sample of parts that represent most of the
production in the shop

Questions from February 2016

Q.5. b) List out different types of assembly line and explain flexibility in assembly line with
example.

Ans:-
An assembly line is a manufacturing process in which interchangeable parts are
added to a product in a sequential manner to create an end product. In most cases,
a manufacturing assembly line is a semi-automated system through which a product
moves. At each station along the line some part of the production process takes
place. The workers and machinery used to produce the item are stationary along the
line and the product moves through the cycle, from start to finish.

Assembly line methods were originally introduced to increase factory productivity

and efficiency. Advances in assembly line methods are made regularly as new and
more efficient ways of achieving the goal of increased throughput (the number of
products produced in a given period of time) are found. While assembly line methods
apply primarily to manufacturing processes, business experts have also been known
to apply these principles to other areas of business, from product development to
management.

The introduction of the assembly line to American manufacturing floors in the early
part of the twentieth century fundamentally transformed the character of production
facilities and businesses throughout the nation. Thanks to the assembly line,
production periods shortened, equipment costs accelerated, and labor and
management alike endeavored to keep up with the changes. Today, using modern

93 | P a g e
Notes by HBS
 assembly line methods, manufacturing has become a highly refined process in which
value is added to parts along the line. Increasingly, assembly line manufacturing is
characterized by "concurrent processes"—multiple parallel activities that feed into a
final assembly stage. These processes require sophisticated communications
systems, material flow plans, and production schedules. The fact that the assembly
line system is a single, large system means that failures at one point in the "line"
cause slowdowns and repercussions from that point forward. Keeping the entire
system running smoothly requires a great deal of coordination between the parts of
the system.

Computer power has enabled tracking systems to become more sophisticated and
this, in turn, has made it possible to reduce the costs associated with holding
inventories. Just-in-time (JIT) manufacturing methods have been developed to
reduce the cost of carrying parts and supplies as inventory. Under a JIT system,
manufacturing plants carry only one or a few days' worth of inventory in the plant,
relying on suppliers to provide parts and materials on an "as needed" basis. Future
developments in this area may include suppliers establishing operations within the
manufacturing facility itself or increased electronic links between manufacturers and
suppliers to provide for a more efficient supply of materials and parts.

VARIATIONS IN ASSEMBLY LINE

METHODOLOGIES
The passage of years has brought numerous variations in assembly line
methodologies. These new wrinkles can be traced back not only to general
improvements in technology and planning, but to factors that are unique to each
company or industry. Capital limitations, for example, can have a big impact on a
small business's blueprint for introducing or improving assembly line production
methods, while changes in international competition, operating regulations, and
availability of materials can all influence the assembly line picture of entire industries.
Following are brief descriptions of assembly line methods that are currently enjoying
some degree of popularity in the manufacturing world.

• Modular Assembly—This is an advanced assembly line method that is designed to

improve throughput by increasing the efficiency of parallel subassembly lines
feeding into the final assembly line. As applied to automobile manufacturing,
modular assembly would involve assembling separate modules—chassis, interior,
body—on their own assembly lines, then joining them together on a final assembly
line.

94 | P a g e
Notes by HBS
• Cell Manufacturing—This production method has evolved out of increased ability
of machines to perform multiple tasks. Cell operators can handle three or four
tasks, and robots are used for such operations as materials handling and welding.
Cells of machines can be run by one operator or a multi-person work cell. In these
machine cells it is possible to link older machines with newer ones, thus reducing
the amount of investment required for new machinery.
• Team Production—Team-oriented production is another development in assembly
line methods. Where workers used to work at one- or two-person work stations and
perform repetitive tasks, now teams of workers can follow a job down the
assembly line through its final quality checks. The team production approach has
been hailed by supporters as one that creates greater worker involvement in the
manufacturing process and knowledge of the system.
• U-shaped assembly "line"—A line may not be the most efficient shape in which to
organize an assembly line. On a U-shaped line, or curve, workers are collected on
the inside of the curve and communication is easier than along the length of a
straight line. Assemblers can see each process; what is coming and how fast; and
one person can perform multiple operations. Also, workstations along the "line"
are able to produce multiple product designs simultaneously, making the facility as
a whole more flexible. Changeovers are easier in a U-shaped line as well and, with
better communication between workers, cross-training is also simplified. The
benefits of the U-shaped line have served to increase their use widely.
As new assembly line methods are introduced into manufacturing processes,
business managers look at the techniques for possible application to other areas of
business. One such application is called Joint Application Development, or JAD. It is
a process originally developed for designing a computer-based system. It brings
together those working in business areas and those working in the information
technology area into a single workshop. The advantages of JAD include a dramatic
shortening of the time it takes to complete a project. The JAD process does for
computer systems development what Henry Ford did for the manufacture of
automobiles (a method of organizing machinery, materials, and labor so that a car
could be put together much faster and cheaper than ever before—the assembly
line).

In a similar way the fundamentals of assembly line theory have been applied to
business processes with success. These new methods of organizing work all share
the common goal of improving throughput by reducing the amount of time individual
workers and their machines spend on specific tasks. By reducing the amount of time

95 | P a g e
Notes by HBS
required to produce an item, assembly line methods have made it possible to
produce more with less.

OR

While there are many types of assembly line systems, some common variations include the
classic, automated, intermittent and lean manufacturing models. These systems are often used
for making different types of products. Classic assembly lines can be used to create complex
items such as cars, which are more or less the same over thousands of products. Intermittent
assembly lines, by contrast, are often used to make a small amount of a product based on
specific, custom orders. Despite the differences in design, many of these assembly lines have
some shared characteristics.
In a classic assembly line, complex products are often assembled using various stations and
many automated processes. The goals of many of these systems are to reduce the amount of
workers required and to alleviate the need to manually move work pieces. Workers and tools are
often spaced along an assembly line, performing one task before allowing the piece to go to the
next station. A worker might only perform one small task, such as tightening a series of bolts.
One of the benefits of the classic assembly line system is that unskilled or semi-skilled
workers are sufficient to complete many of the manufacturing or fabricating tasks.
An automated assembly line is generally one that requires little human input to operate. These
can include large-scale, mass-production systems using computer-controlled machines. This
type of assembly line reduces some of the dangers associated with assembly line work, which
makes it especially helpful when chemicals or heat would make human intervention difficult.
Automated systems are often combined with other systems, depending on the product.
Intermittent assembly line systems can include the same elements as many other systems, but
work pieces are often customized to specific orders. Workers and machines must adapt to the
changes, which often increases the final production cost. Guitar manufacturing, for instance,
requires a similar process every time, even though each guitar might be different based on
consumer demand and material properties.

Lean manufacturing uses teams of workers on an assembly line to create products. The primary
difference of this assembly line system is that workers often change jobs and may split the
workload in novel ways, depending on the work pieces. In some ways, this kind of system can
help to alleviate many of the hazards associated with classic assembly lines, including boredom
and repetitive motion injuries.

Flexibility in Assembly line :-

In the early days of automotive assembly, when there were no extra amenities
offered in the car and therefore no variability on the line, production was a fairly
straight-forward process. Today, mass customization in high-volume manufacturing
has caused a dramatic shift in assembly plants. Add to that the economic need to
consolidate plants—meaning more products are being built on the same line—and
the assembly process can turn into a puzzle.

96 | P a g e
Notes by HBS
Indeed, the modern assembly line must be flexible and agile in order to manage product
variability without introducing waste or compromising quality.

The Smart Factory Assembly, a portfolio of manufacturing intelligence applications,

real-time location tracking technology, and smart devices that will help automotive
manufacturers reduce the cost and complexity of the assembly line.

Based on the company’s existing precise indoor location technology which can track
and locate tagged assets to an accuracy of about 15 cm in real-time, Smart Factory
Assembly adds operational awareness, adaptive control, and data-driven insights
delivered in a virtual system that uncouples the processes from the fixed workstation.

Line balancing can be difficult to do with handheld scanners or passive automatic ID

systems and result in the line being stopped if a task is not completed at the end of
the workstation. Ubisense’s new Virtual Station operates using virtualized vehicle
identification triggers that can be easily added and moved in software, simplifying the
need to accommodate new processes or move existing tasks during line
rebalancing.

In addition, the new Smart Device creates software-defined zones around a vehicle which
constitutes a virtual device control zone. This zone can be used in all of the ways a fixed
workstation can be used, for example, controlling the region within which wireless tools can
operate. However, software-defined device zones are agile and can accommodate real-time
variation, such as varying task duration for different models and moving workstations that
allow workers to catch up or work ahead.

“The magic of this is that it is completely adaptable on-the-fly,” says Adrian Jennings,
vice president of manufacturing strategy at Ubisense. All cars are different from one
another and might have slightly different “bubble” zones, so if a worker needs two
extra seconds to complete a job, the virtual workstation provides the time needed to
finish the job rather than stop the line. The system can detect the status of a tool, the
position of it, and make simple, but intelligent decisions about whether to provide
extra space or not.

Q.6. Write a short note on the following:

a) Production flow analysis

97 | P a g e
Notes by HBS
Production Flow Analysis (PFA) uses a matrix of part numbers and machine numbers to group
families. In the matrices below, columns represent the machines whose numbers and names are at
the top. Rows represent parts whose numbers and names are on the left. When a particular part
requires a particular machine, the operation sequence number is in the intersecting spreadsheet cell.
Sometimes, merely an "X" signifies that a particular part needs a particular machine.
Most part families have a "natural sequence." For example "Lathe" normally precedes "Deburr". This
natural sequence dominates and becomes the basis for the workcell layout. You can usually ignore
sequence issues when developing the PFA matrix.
It is difficult to see order or similarity in the first matrix. Rearranging the rows and columns, as in the
second matrix, clearly shows families of similar parts and the machines required to build them. These
machines form a workcell.
This example illustrates the principle but it oversimplifies. In practice, these matrices can become
quite large. A matrix with more than a few hundred parts and 20 or so machines becomes unwieldy
for manual manipulation. However, it can be done. Click for an examplewith 235 products and 35
processes.

Facilities & Workplace Design has an excellent

chapter on workcells with examples of Production Flow Analysis.
Computer programs are available for manipulating large matrices but they cannot solve the problem
of inconsistent routings that is often encountered in a PFA analysis. Inconsistent routing means that
similar parts use different machines. This occurs for a variety of reasons such as:

Parts have usually entered the product mix over a period of many years. Different conditions
and different planners over this time have arrived at different routing decisions.

Capacity issues may influence routing decisions. For example, machine A would normally be
used for a particular operation but it is heavily loaded so the process planner uses machine B.

Different process planners have different backgrounds and a different bias. This may lead to
different routings for the same part.
Analysts encounter inconsistent routings in most PFA analyses. If the product mix is not too complex,
they can make intuitive manual adjustments. When the product mix becomes larger than 100 or so
items, PFA becomes too cumbersome and a Coding & Classification analysis is indicated.

OR

98 | P a g e
Notes by HBS
 99 | P a g e
Notes by HBS
b) Automats in Material handling system

Automated Material Handling (AMH) – The Lyngsoe Sort Mate™ sorting

system for libraries
Automated sorting processes
An automated material handling (AMH) system, as the name indicates, automates some of the
sorting processes in a library. It allows patrons to return media without staff intervention.

100 | P a g e
Notes by HBS
Works with the library management system
Patrons return media into the sorting system through dedicated inductions, where the integrated
scanners read the media, and automatically report the media as returned to the library
management system, where all data resides.
Integrated scanning
The integrated scanners in the inductions read the RFID tags and/or bar codes on the media, and
the software determines the appropriate material category (e.g. Novels),before sending the media
on to the sorter. The sorter conveys the media to the chute as defined by the library staff in the
control software.
Suitable for both small and large
Sorting systems may vary greatly in size to serve both the small local library and the very large
central sorting facility.
The number of chutes to sort the media into may vary, but the principle remains the same:
Alleviate library staff from repetitive, routine movements, and get media faster in circulation.
From sorting to service
AMH is a great investment to free up librarian resources towards even better patron service.

Benefits
Improved circulation, ergonomics, and service
Lyngsoe has made it to a specialty to provide ergonomics on top of sorting. The Lyngsoe Ergo
Cart™ exemplifies this, by allowing books to be stacked in the sorter, and easily transported
without any lifting all the way to the shelf. Fast return to circulation, minimal time spend, and no
unnecessary lifting.
Quality built on experience
State-of-the-art automation from Lyngsoe Systems, build on logistics expertise from the most
demanding sectors, builds the platform for designing hardware and software together, and
engineering it to last. Hundreds of AMH installations have proven the value.
Meeting your needs with engineered flexibility
An extensive product range meets both the needs in the small library branch and in the central
sorter facility. The open, compact, and modular design allows for placement in all surroundings,
and the low noise warrants for a pleasant work place environment. Be it barcode or RFID, a
Lyngsoe solution will fit.

OR

101 | P a g e
Notes by HBS
In recent years, the demand for industrial robots has accelerated considerably due to a
variety of factors, including the ongoing trend toward automation and the continued
innovative technical improvements of industrial robots.

Automating industrial processes offers manufacturers a host of benefits: accuracy in

production, consistent quality results, low maintenance costs, faster work (24/7),
reallocation of skilled workers to other areas of the warehouse, etc.

As noted in a PR Newswire press release, one market in particular — automated material

handling — has fundamentally changed the way various industries, including
manufacturing, function. This market, poised to more than double over the next five
years, is forcing the material handling industry to respond with new equipment,
technologies, and systems.

Let’s explore some of the factors driving this growth of automated material handling, as
well as what they mean for manufacturing companies:

Industry Growth & Shortage of Skilled Workers

According to a FoodOnline blog post, a major driver of the automated material handling
market’s acceleration is “growth in the manufacturing sector and an increase in the
number of manufacturing facilities.”

Despite what many refer to as a “mid-year slowdown,” a

recent IndustryWeek article reports that U.S. manufacturing has shown strength in
recent months. “The October report is a positive statement about manufacturing
growth,” says MAPI Foundation chief economist Daniel J. Meckstroth in the article. “A
recent major driver of growth is the ramping up of the construction supply chain; both
residential and commercial and industrial construction are strong, and public works
construction is growing at a modest pace.”

Meckstroth also notes that the solid growth in October bodes well for heading into 2016.
As the industry continues to experience growth in the coming year, however,
manufacturing must come to grips with how best toincorporate Millennials into the labor
force to positively contribute to the future of the industry.

Enter automated material handling.

“For manufacturing, there’s a significant percentage of Baby Boomers looking to retire in

the coming years,” says Ed Romaine, Vice President of Sales & Marketing, SI Systems.
“So how do you replace the older generation of skilled workers? You replace them with
automation. Automation is going to fill the voids, fill the gaps by making processes more
efficient.”

102 | P a g e
Notes by HBS
Improved Technology
Automated material handling — comprising automated guided vehicles (AGV),
automated storage and retrieval systems (AS/RS), automated conveyor and sorting
systems, robotic systems, automated crane and various software systems — isn’t a new
concept.

Research from Boston Consulting Group shows roughly 10 percent of today’s

manufacturing functions are fully automated — and that number is predicted to reach 25
percent over the next decade, as robotic vision sensors, intelligence and gripping
systems improve.

In combination with industry growth and shifting workforce demographics, the

automated material handling market is also being driven by improved wireless
technology, particularly with regard to AGV.Seegrid's vision-guided AGV, for example,
uses navigation sensors to build a 3D map of the manufacturing facility, which allows the
vehicle to follow a trained route without human assistance or the addition of special
features, landmarks, or positioning systems.

As noted in an article on Manufacturing.net by Martin Hurworth, Operations and

Technical Director at UK-based Harvey Water Softeners, “The manufacturing sector is a
fast-changing, cut-throat industry. Firms who make their living there should be
constantly looking to invest in new technologies to make their operations smoother,
smarter and swifter, not to mention more cost-effective.”

Enhanced Focus on Worker Safety

As more and more companies look toward automation to remain competitive in the
market, drive down costs and promote efficiency in the warehouse, they also create a
safer working environment for employees in doing so. Improving working and safety
conditions is, in fact, one of the primary drivers of automated material handling,
according to a recent MarketsandMarkets post.

The idea isn’t simply to protect workers from warehouse injury or illness, although the
Bureau of Labor Statistics data on warehouse accidents speaks for itself. Automating
material handling tasks allows manufacturers to remove workers from dangerous or
repetitive work and redeploy talent to other areas of the warehouse where workers can
be more productive, safe and fulfilled.

SI Systems’ Ed Romaine notes that automation allows his organization to make sure that
it takes the least amount of effort to do the most amount of work. “By using automated
systems and intelligent software, we’re now reducing walking, searching, and time spent
delivering things,” he says. “These are all different means of reducing the ergonomic
strain on an individual, which helps enhance the company’s return on investment on
their employees. It’s a win-win for everybody involved.”

103 | P a g e
Notes by HBS
Final Thoughts
Automated material handling is more than just a good idea for companies looking to
drive efficiency, productivity and revenue growth in the years to come. As noted above,
the main drivers of this market’s growth — manufacturing facility expansion/shifting
workforce demographics, advanced technologies, and worker safety — are forcing the
industry to respond with new technologies, equipment and systems.

Q.7. Write short notes on the following

c) Unit load concept

Pallets and containers are two most commonly used material handling equipment, used to provide the
right material at the right place and within the right cost. Several firms today have adopted just in time
programs as a result of which the combination of containers for parts distributed on pallets has gained
more popularity. A basic principle of material handling is the concept of unit loads. A unit load is a
number of items arranged as one unit, to be moved or handled at one time. In effect, the unit load
implies the container and the support platform or pallet. The main advantage of using unit loads is the
ability to handle more items at one time. This reduces the number of trips, handling costs, loading and
unloading times as well as product damage. The most flexible and multi-faceted material handling
systems are the Automated Guided Vehicles (AGVs) and have a variety of functions such as guidance
and routing systems to traffic management and load transfers.

OR

UNIT LOAD CONCEPT

Arrangement of single or multiple items, or bulk material, into a single mass andrestrained
for movement and storage. Generally these arrangements are toolarge for manual
handling.
•
Unit load is the unit to be moved or handled at one time.
•
Advantage: handle multiple items -- reduce the number of trips
•
Unit loads can be contained in totes, cartons, pallets, pallet boxes, etc.
•
Enclosure and stabilization is provided by strapping, shrink-wrapping, andstretch-wrapping
•
Unit load specification is an integral part of material handling and storagesystem
designSmall Load vs Large
LoadU n i t l o a d s a r e a n e x t e n s i o n o f t h e b u i l d i n g -
blocks concept for very largequantities. The basic unit in unit l
o a d i n g i s t h e p a l l e t o r s k i d . U n i t l o a d i n g involves the securing of one
or more boxes to a pallet or skid so that the boxescan be handled by mechanical
means. The boxes or other containers secured toa pallet are known as a unit load.Unit Load
- Loads moved as single entities. This is one of the basic principles of Material handling

104 | P a g e
Notes by HBS
Integrity of Unit load
•
The unit load may be different along the supply chain
•
Integrity can be maintained in various ways:
–
Boxes
–
Cartons
–
Pallets
–
Strapping, shrink wrapping
Methods for Moving the Unit Load
•
Lifting under the mass
•
Inserting the lifting element into the body of the unit load

OR

Advantages of Unit Loads.

a. Economy. Unit loads provide an economical

means of handling, storing, and transporting by

eliminating manual handling of individual items and

minimizing the incidence of pilferage.

b. Speed in handling. With unit loads, more

tonnage can be moved in less time than is possible with

other handling methods.

c. Utilization of cubic space. Material in unit loads

Figure 3-57. Nonpalletized unit load of boiler tubes.

can be mechanically stacked to greater heights, thus,

utilizing a greater percent of available cubic storage

space.

Covered space is expensive; therefore,

increased utilization will decrease the overall cost of

storage. During periods of increased receipts, the

demand for storage space frequently exceeds the

supply.

Utilization of cubic space is even more

important at this time.

105 | P a g e
Notes by HBS
d. Decreased damage to material. Incidence of
damage to material handled under the unit load concept

will be much less than for material handled as individual

containers through all steps of storage and

transportation.

e. Safety. Handling of material in unit loads is

safer for personnel. Many of the accidents most

Figure 3-58. Nonpalletized unit load of lumber.

common to storage operations occur where individual

container handling is involved.

b. Use of storage aids. Storage aids such as

dunnage, collars, spacers, separators, strapping, and

3-89. Unitizing Methods.

others should be utilized when necessary to secure,

holster, or protect unit loads in storage as well as loads

a. Nonpalletized unit loads. Usually, non-palletized

prepared for shipment. For details in the use of these

unit loads (including lumber, steel, and bar stock)

aids for storage purposes, refer to chapter 5. For their

whether assembled for storage or shipment will be much

use in shipping functions, refer to MILSTD-147.

larger in length than the normal palletized unit load.

However, the dimensions of non-palletized unit loads

c. Cube dimension and weight requirements of unit

should not exceed 48 inches in either width or height

e) Safety considerations for plant layout

A proper plant layout is inevitable in minimizing the spread of
hazards and plays a prominent role in reducing the amount of loss
that could have taken place in and out of the plant premises.

It feels disheartening that it is very difficult to change conditions
for the plants that have already been commissioned and for the

106 | P a g e
Notes by HBS
 plants that are located in congested areas. Older areas were not
planned and as result there is lesser scope of improvement due to
the unavailability of space.

Another problem is that most of the occupancies now days are
hired on rent since it is not

always affordable to set up a plant as per one’s particular
requirements due to some practical reasons.

The newer industrial areas, residential areas, commercial areas etc.
are tried to be taken care to be as per standards. The government
of India has implemented several steps that have enabled the
builders and developers to stick to the standards resulting into
safer layouts.

Though not much can be done about the already constructed
structures, following can be deliberated while planning a new
project whether industrial, commercial or residential:

Location:
Exposure to natural perils: must be one of the prior considerations
while the



occupancy is under the planning stages. Natural perils include
flood, wind/cyclone, earthquake; climatic conditions etc. always
pose a threat to the plant that is constructed in such an area. For
e.g. a building in Jaipur or Calcutta is less prone to Earthquake
than a building in J&K or Bhuj.

Also, fires are reported more in summers than in winters due to
the higher temperatures. Thus it may be commented that chemical
factories or solvent extraction plants are best suited where the
temperatures are moderate.

Local Considerations: with respect to riots, strike, terrorism,
railway track, airport, etc.
Riots may prove dangerous to the plants operations. Arson and
other damages result during riots. Riots often take place in densely
populated areas of a city and occupancy located outside the city is

107 | P a g e
Notes by HBS
 less prone. Riots may also result in rural areas when small
communities try to settle their dispute through a face to face battle.

OR

Plant layout design for safety aspect

1. 1. A PRESENTATION ON PLANT LAYOUT DESIGN FOR SAFETY ASPECT

ENVIRONMENTAL ENGINEERING AND SCIENCES ANURAG SINGH
MT/ENV/10005/2013 2ST SEMESTER
2. 2. } Plant layout refers to the arrangement of physical facilities such as machinery,
equipment, furniture. within the factory building in such a manner so as to have
quickest flow of material at the lowest cost and with the least amount of handling in
processing the product from the receipt of material to the shipment of the finished
product.
3. 3. } Meet quality and capacity requirement in the most economical manner }
Minimize unit costs and optimize quality } Promote effective use of people,
equipment, space and energy } Provide for employee safety and comfort } Control
project costs } Achieve production deadlines
4. 4. } New site development or addition to previously developed site. } Type and
quantity of products to be produced, } Possible future expansion, } Operational
convenience and accessibility, } Type of process and product control, } Economic
distribution of utilities and services,
5. 5. } Type of building and building code requirements, } Guidelines related to health
and safety, } Waste-disposable problems, } Space available and space requirement, }
Auxiliary equipment, and } Roads and railroad.
6. 6. Accidents (%) 44 Process Design 22 12 11 5 5 1 Mechanical Operator Error
Unknown Process Upsets Natural Hazards Design Sabotage and Arson
7. 7. Procedure of Plant Layout Design Information Gathering Determine what will be
produced Determine how many will be produced Determine what components will be
made or purchased Determine required operations Determine sequence of operations
Production and Flow Analysis Determine the plant rate Determine the number of
machines Study the flow requirement Determine activity relationships Support
Services Identify needs for personal and plant services Identify office needs Develop
total space requirements
8. 8. EQUIPMENT LAYOUT METHOD STRAIGHT LINE FIXED POSITION LAYOUT
COMBINED LAYOUT
9. 9. FLOW CHART OF LINE LAYOUT

108 | P a g e
Notes by HBS
 10. 10. Raw Mat. Forging Press Forging Press Gear Cutting Machine Gear cutting Machine
Gear cutting Machine Heat Treatment Heat Treatme nt Gear Grinding Machine Gear
Grinding Machine F i n i s h e d O u t p u t
11. 11. } Prevent, limit and mitigate escalation of adjacent events } Ensure safety within
on-site occupied buildings } Control access of unauthorized personnel } Facilitate
access for emergency services
12. 12. Fig. Steps of a safety and risk analysis
13. 13. General Control Facilities Location of Buildings and Structures Flow Sheet Escape
Layout of Equipment Electrical Equipment PLANT LAYOUT FOR SEAFTY Ventilation,
Heating and Air Conditioning Storage Receiving and Dispatching Road and footpaths
Transportation system Railway Parking Areas
14. 14. An ideal plant layout should provide the optimum relationship among output,
floor area and manufacturing process. It facilitates the production process, minimizes
material handling, time and cost, and allows flexibility of operations, easy production
flow, makes economic use of the building, promotes effective utilization of
manpower, and provides for employee’s convenience, safety, comfort at work,
maximum exposure to natural light and ventilation. It is also important because it
affects the flow of material and processes, labor efficiency, supervision and control,
use of space and expansion possibilities
15. 15. } Plant location and layout by Abha Kumar } Bausbacher, E.F. & Hunt, R.W. 1993.
Process Plant Layout and Piping Design. Englewood Cliffs: Prentice Hall. } Inherent
safety in process plant design by AnnaMari Heikkilä } Indian standard for Industrial
plant layout - code of safe Practice } Principles of Inherent Safe Design by Jo Fearnley

f) Technical and economic consideration for equipment replacement.

introduces some aspects to be taken into consideration when a company has to acquire a machine
tool. Money is a precious asset and you need to spend it wisely when you have to repair an aging
piece of equipment, when you need to remanufacture components within the unit or when it is
necessary to replace equipment. The choice of the machine tool type to be purchased depends on a
number of factors also related to production requirements, not only to machine price, such as: cost
of devices, tools, control devices, machining, cost of the possible training courses, cost of necessary
arrangements (foundation, electrical connections, air, water, etc.), possible guarding and fencing of
the auxiliary spaces intended. It insists in particular on the purchase of heavy and very heavy duty
machine tools from the category of universal and CNC type machine tools. These machines are
complex ones, they take a large volume in the industrial spaces and their prices are high, exceeding
sometimes the amount of millions of dollars. Taking into account only these latter remarks, a
technical and economic study should be made prior to any such acquisition

109 | P a g e
Notes by HBS
One of the modern strategies when dealing with machine tools is the 3R policy (Repair-
RemanufactureReplace): • Repair: action taken to bring a defective or degraded component back to
full serviceability; • Remanufacture: action taken to remove a component and substitute it with a
direct serviceable replica

GENERAL CONCEPTS If it comes to buying a machine tool to meet certain technical requirements,
one should take into consideration the fact that such an investment will pay off in a period of 5-10
years, usually. One should examine to what extent, following up the acquisition, the prime cost
and/or the time needed for each piece can decrease and to what extent the machine loading
throughout the next 10 years will be ensured. In some cases, this review can even entail giving up
the purchase and transferring the production to other existing machines or even to other partners .

2.1. Providing raw material (CM) The machine tools are usually used for machining the cast, forged
or rolled semi-products. If the same type of semi-finished product is used till the moment of

110 | P a g e
Notes by HBS
machine purchasing, then there are not any problems. If one moves to a new type of semi-finished
products, one should review the price and the possibility to supply them.

2.2. Costs of machining operation (CP) Depending on the machine type, its degree of automation
and the skills of the staff, one can determine the time needed to make a work piece on this machine.
This time can be higher at the machine purchasing moment but it decreases as the worker becomes
familiar with the new controls. After a while, a minimum and steady value of the time for a work
piece can be reached [1]. In the case of CNC machines, it is preferable to purchase machines with the
same type of equipment as those already existing in the respective plant, enabling the workers to
shorten the time necessary for learning how to operate. In the first stage, the times can be
calculated according to cutting mode parameters and to machine characteristics.

2.3. Labor Cost (CW) Machine tools workers and operators are paid in conformity with their skill
level. In case of the special machine tools, on which a single type of work piece is machined
throughout the whole lifetime of the machine, the worker has especially the role to supervise the
production process and maybe to change the tools; his skill level is a low one. In the case of universal
machines without CNC equipment, the workers shall be skilled, as they are the owners of some
control and adjustment methods that require specific knowledge of geometry, trigonometry,
strength, cutting, etc. These workers will be the most expensive ones. For modern machine tools,
equipped with CNC, even if the “machine” takes over much of the control and adjustment functions
and the worker is not very skilled, one must take into account the fact that the labor costs will also
include the invisible part of the process, namely the cost of the programmers.

2.4. Other costs In a factory that uses machine tools, besides the costs mentioned above, there are
also other expenses not at all negligible. We can mention, for example: machines maintenance
department, tool sharpening workshops, staff involved in purchasing, control, advertising,
accounting, management, cleaning and security activities. A part of these activities can be
outsourced but only to the extent of cutting down expenses. Depending on production type,
company size and its importance on the market, these costs can add to the above mentioned costs
values between 50% or even 500%. Some of these expenses can be reduced by purely technical
criteria. Therefore, it will be preferred that in a company exist as few as possible suppliers of spare
parts for the electric, electronic, hydraulic and pneumatic components of the machine tools. It is
preferable that all CNC machines or most of them to be provided with equipments originating from
only one manufacturer.

2.5. Investment cost When purchasing a machine tool, the investment includes: cost of the machine,
cost of devices, cost of the possible training courses, cost of necessary arrangements (foundation,
electrical connections, air, water, etc.), possible guarding and fencing of the auxiliary spaces
intended for tools, control devices, etc. One should not neglect the price of the machine transport
from manufacturer’s site and the commissioning cost. This activity, if performed by the

111 | P a g e
Notes by HBS
manufacturer, makes usually the subject matter of a separate contract besides the machine sale
contract. The above mentioned costs can amount up to 10−20% on machine costs.

2.6. Necessary space in workshop Machine tools are placed in closed spaces, preserved against bad
weather, often thermo-regulated spaces. Besides the space actually occupied by the machine, one
should keep in mind that there are also spaces needed for access, for tools and jigs storage, buffer
spaces for semifinished products and parts, etc. These other spaces can represent up to 200% of the
space occupied effectively by the machine. Each square meter costs and is included in the total rent.
The value of this rent depends on country, zone, owner, type of production, etc. and is not at all
negligible. This space must be reduced in different ways. Thus for two gantry milling machines [2]
one will prefer the solution with displaceable gantry instead of movable table, the latter solution
requiring , for the same overall size, a twice bigger space for assembling. In case that a new building
is necessary for locating the new machine, one will take into account the surface purchased or
rented, the cost of the building and the associated expenses.

CONCLUSIONS

The choice of the machine tool type to be purchased depends on a number of factors also related to
production requirements, not only to machine price. When planning one should always consider the
following: • cost of repair vs. remanufacture vs. replace; • cost of downtime; • cost of additional
spares. Lately, the universal machines equipped with a complex mechanical part, with many
kinematic chains, many gears and clutches and other systems of transmission, have prices
comparable to the prices of second hand CNC machines. These ones, because of the simplifications
brought by the modern drives and controls, allow the machining of complex surfaces, in terms of
high accuracy and productivity, using a simple mechanical structure. High performance machine
tools can be built on mechanical structures that are 10 to 15 years old. The example above is purely
theoretical, with probable values, helping to create a model of analysis of the opportunity to
purchase a machine tool.

Q.2. b) Describe the different factors consider for the machining plant
layout and assembly plant layout.

Ans:- Top 10 Factors influencing design of plant

layout
The following factors should be considered While designing the layout.

1. Nature of the product: The nature of the product to be manufactured has a significant
influence on plant layout. Small and light products can be moved from one machine to
another with minimum effort and time and therefore line layout would be more suitable.

112 | P a g e
Notes by HBS
Stationary layout would be suitable for heavy and bulky products. In case of production of
large variety of non-standardized products, process layout is ideal.
2. Production volume: Line layout should be preferred if standardized commodities are
manufactured on a large scale. Functional layout is suitable if production is based on
customers orders. It is better suited for low volume job production.
3. Location of the site: The topology and size of the site influences the choice of a particular
layout. The idea is to maximize the utilization of space. Layout should also suit the factory
building. The positioning of elevators, stairways, parking lots and storage points also
influence the layout.
4. Type of machines: Stationary layout is preferable if machines are heavy and emit more
noise. Such heavy machinery can be fitted on the floor. Adequate space should be provided
for the location of machines and also there should be sufficient space between them to avoid
accidents.
5. Climate: Temperature, illumination, ventilation should be considered while deciding on
the type of layout. The above factors should be considered in order to improve the health and
welfare of employees.
6. Service facilities: The layout should provide for the comforts and welfare of the
employees. It should have adequate provision for rest rooms, drinking water, lavatory. There
should be sufficient space for free movement of workers.
7. Safety of employees: While deciding on a particular type of layout, the safety of
employees should be given importance. The layout should provide for obstruction free floors,
non-slippery floors, protection against dangerous fumes, excess heat, strong odors Etc.
8. Type of production: Layout plans differ according to the type of production. In case of
job orders, production of non-standardized products are undertaken, and therefore functional
or process outlet is suitable. Line layout would be suitable when there is mass production of
standardized goods.
9. Type of process: In the case of intermittent type of production (bi-cycle manufacturing,
electronics), functional layout is suitable. For synthetic type of Production (cement and
automobile industries), line layout is preferable.
10. Management policies: Policies of the management relating to type of product, quality,
scale of production, level of plant integration, type of production, possibility of future
expansion etc., influence the type of layout to be adopted.

113 | P a g e
Notes by HBS
What are the factors affecting plant location
decisions and the need for such decisions
Units concerning both manufacturing as well as the assembling of the products are on a
very large scale affected by the decisions involving the location of the plant. Location of
the plant itself becomes a very important factor concerning service facilities, as the plant
location decisions are strategic and long-term in nature.

Plant location decisions need detailed analysis because:

1. Wrong plant location generally affects cost parameters i.e. poor location can act as a
continuous stimulus of higher cost. Marketing, transportation, quality, customer
satisfaction are some of the other factors which are greatly influenced by the plant
location decisions – hence these decisions require in-depth analysis.
2. Once a plant is set up at a location which is not much suitable, it is a very disturbing
as well as very expensive process to shift works of a company to some other place, as it
would largely affect the cycle of production.

3. The investments involved in the in setting up of the plant premises .buying of the land
etc are very large and especially in the case of big multinational companies, the
investments can go into millions of rupees, so economic factors of the location should be
very minutely and carefully checked and discussed in order to achieve good returns on
the money which has been invested.
The Need for location decisions –
These decisions are needed when a new plant is to be set up or when the operations
involved in the company at the present location need to be expanded but expansion
becomes difficult because of the poor selection of the site for such operations. These
decisions are sometimes taken because of the social or the political conditions engulfing
the working of a company.
The way the works of a company have to be performed, largely depends upon the
industrial policies issued by the government. Any change that creeps in the industrial
policy of the government which favors decentralization and hence does not permit any
change or any expansion of the existing plant – requires strictly evaluated location
decisions.

Factors governing plant location:

1. Regional factors: These factors include proximity of the plant to the market and also
to the sources of the raw materials. They also include infrastructural facilities,
transportation facilities, and availability of skilled workers, legislation, the taxation and
also the work attitude of the workers.

114 | P a g e
Notes by HBS
Robinson was the one who has very clearly and efficiently justified industrial location
concerns using pure materials nearer to the markets or the consumption centers.
According to Robinson, the place of production is likely to be at the place of consumption
where the final product is more expensive to carry because it is more bulky, more fragile
or more perishable than is raw materials.

2. Community factors: These involve accommodation, education, entertainment and

transport facilities. It also includes attitude of the community, supporting industries and
services, suitability of the land etc.

Examples of plant location ( India)

• Most of the textile mills are found in or near Mumbai and Ahmedabad because of the
humidity conditions that prevail there.
• Sites for nuclear power plants to be located in different parts of the country largely
depend upon environmental, safety, socio-economic and also the engineering factors
affecting the construction and operation of such plants.

• Steel plants are generally located near the Jharkhand, Bengal, Chhattisgarh and Orissa
regions. This choice of site is mainly because of more economical transport of the
finished goods as compared to basic raw materials.

• Similar case is observed in the plants which manufacture cement; such plants are
located near the lime and the coal deposits.

• Namroop and Thal Vaishet, both act as very important sites for the gas-based fertilizer
plants. Coal based fertilizer plants at Ramagundum are located near the source of raw
materials (coal).

• Naptha / oil based fertilizer plants at Mangalore, Madras, Cochin have been located
near ports, which act as a great source for the import of the raw materials.

• ‘Proximity to market’ forms a major factor which affects plant location decisions in case
of machine tool industries. In case of such industries, sites are scattered over different
parts of the country such as Ludhiana, Pune, Bangalore, Calcutta, Mumbai etc.

• Information Technology/BPO/Software Industries depend largely on availability of

skilled personnel, infrastructure etc… Because of these reasons most of such
organizations operate in urban areas such as Delhi, Chennai, Hyderabad, Bangalore,
Pune etc.

115 | P a g e
Notes by HBS
Q. Explain various aspect of Automation and Computer Aids in
warehousing operation. (Internalassignment 2017 for Feb exam).

Ans:- Finding computer applications for various aspects of a companys operations has, in
recent years, become an increasingly vital task of many small business owners.• Indeed,
computers are an integral part of the business landscape today, in part because they can be
an effective tool in so many different aspects of a businesss daily operations.

Computer systems are now relied on for a broad spectrum of duties, including bookkeeping,
business communications , warehousing , product design, manufacturing, inventory control,
and marketing.• Indeed, a 1997 survey conducted by Sales & Management magazine
indicated that 85 percent of respondents felt that technology was increasing the efficiency of
their sales force, while another 62 percent concluded that it was helping them increase their
sales.

A warehouse is a commercial building for storage of goods. Warehouses are used by

manufacturers, importers, exporters, wholesalers, transport businesses, customs, etc. They are
usually large plain buildings in industrial areas of cities and towns. They usually have loading
docks to load and unload goods from trucks.

Sometimes warehouses are designed for the loading and unloading of goods directly from
railways, airports, or seaports. They often have cranes and forklifts for moving goods, which
are usually placed on ISO standard pallets loaded into pallet racks.• Stored goods can include
any raw materials, packing materials, spare parts, components, or finished goods associated
with agriculture, manufacturing, or commerce.

Warehousing is the management of materials while they are in storage . It includes storing
,dispersing , ordering , and accounting for all materials and finished goods from the
beginning to the end of the production process warehousing facilities may range from small
stockrooms to large , highly mechanized facilities.

The inventory management within a warehouse involves much planning and organization .
the flow of materials through the warehouse and the method of movement are important.•
Warehouse activities include receiving , putting away , storing ,order picking, packaging and
pricing ,sorting ,and shipping . In a hospital warehouse , for example ,materials management
workers receive supplies from shippers . They check the packing slip for completeness and
attach it to a copy of the purchase order .Then , they “put away” the product in a
preassigned warehouse location for storage . The order picking takes place when a hospital
units requests the product.

116 | P a g e
Notes by HBS
 117 | P a g e
Notes by HBS