AN APPROACH TO IMPLEMENT LEAN CONCEPTS

IN SUPPLY CHAIN OF STEEL INDUSTRY.

A Project Report Submitted to

Shri Ramdeobaba College of Engineering & Management, Nagpur

in Partial fulfillment of VI semester of

Bachelor of Engineering
In

INDUSTRIAL ENGINEERING

By
Jatin Pradhan (46)
Lakshya Sarda (52)
Shubham Tiwari (72)

Under the Guidance of

Dr. V.S Deshpande and Prof. Himanshu Shukla

Department of Industrial Engineering

Shri Ramdeobaba College of Engineering and Management
Nagpur, 440013
(An Autonomous Institute affiliated to Rashtrasant Tukdoji Maharaj Nagpur University
Nagpur)
May, 2021

1
AN APPROACH TO IMPLEMENT LEAN CONCEPTS
IN SUPPLY CHAIN OF STEEL INDUSTRY.

A Project Report Submitted to

Shri Ramdeobaba College of Engineering & Management, Nagpur

in Partial fulfillment of VI semester of

Bachelor of Engineering
In

INDUSTRIAL ENGINEERING

By
Jatin Pradhan (46)
Lakshya Sarda (52)
Shubham Tiwari (72)

Under the Guidance of

Dr. V.S Deshpande and Prof. Himanshu Shukla

Department of Industrial Engineering

Shri Ramdeobaba College of Engineering and Management
Nagpur, 440013
(An Autonomous Institute affiliated to Rashtrasant Tukdoji Maharaj Nagpur University
Nagpur)
May, 2021

2
 Shri Ramdeobaba College of Engineering and Management,
Nagpur
(An Autonomous Institute Affiliated to Rashtrasant Tukdoji Maharaj Nagpur
University Nagpur)
Department of Industrial Engineering

CERTIFICATE

This is to certify that the Thesis on “AN APPROACH TO IMPLEMENT LEAN

CONCEPTS IN SUPPLY CHAIN OF STEAL INDUSTRY” is a bonafide work of
Jatin Pradhan, Lakshya Sarda & Shubham Tiwari submitted to the Rashtrasant
Tukdoji Maharaj Nagpur University, Nagpur in partial fulfillment of the award of a
Bachelor of Engineering in Industrial Engineering has been carried out at the
Department of Industrial Engineering, Shri Ramdeobaba College of Engineering and
Management, Nagpur during the academic year 2019-20.

Date:
Place:

Prof. Himanshu Shukla Dr. V.S. Deshpande

Co-Guide Project Guide
Department of Industrial H.O.D.,
Engineering Department of Industrial
Engineering

Dr. R.S. Pande

Principal

DECLARATION

3
I/We, hereby declare that the thesis titled “AN APPROACH TO
IMPLEMENT LEAN CONCEPTS IN SUPPLY CHAIN OF STEAL
INDUSTRY” submitted herein, has been carried out in the Department of
I n d u s t r i a l Engineering of S h r i Ramdeobaba College of Engineering &
Management, Nagpur. The work is original and has not been submitted
earlier as a whole or part for the award of any degree / diploma
at this or any other institution / University.

Date: 20/05/2021

Place: Nagpur

1) Jatin Pradhan (46) :

2) Lakshya Sarda (52) :
3) Shubham Tiwari (72) :

4
 ACKNOWLEDGEMENTS

With immense pleasure and great respect, we take this opportunity to express deep sense of
gratitude to our project guide Dr. V. S. Deshpande and Co-guide Prof. Himanshu Shukla,
Department of Industrial Engineering, RCOEM, Nagpur, for their invaluable guidance,
inspiration, constant encouragement and motivation throughout the project work.

We also express our sincere gratitude towards Dr. V. S. Deshpande, Head of

Department of Industrial Engineering, RCOEM, Nagpur, for his invaluable guidance and
motivation to do this project work.

We are indebted to the faculty members of Department of Industrial Engineering,

RCOEM, Nagpur, for giving us valuable time and helping us to get through the difficulties
came across at each stage of project work.

We would like to express our special gratitude and thanks to Dr. Rajesh Pande,
Principal, RCOEM, Nagpur, for his cooperation and encouragement.

Last but not least, we are very much thankful to our parents and friends who directly
or indirectly supported us at every stage to bring this project towards successful completion.

Projectee

Jatin Pradhan (46)

Lakshya Sarda (52)

Shubham Tiwari (72)

5
 ABSTRACT

We carried out our project at Ramsons casting pvt. Ltd. On the topic An Approach to
implement Lean Concepts in Supply chain of Steel Industry. Ramsons casting pvt. ltd
manufactures long steel products i.e., billets, angles, flats etc. At industry we understood
process, operation and supply chain model to procure raw materials, manufacture billets and
deliver it to customer.

Due to COVID-19 we were unable to visit the industry multiple times and we are still in the
process of critical examination of each and every process/activity in the industry. We have
collected the data regarding the production and supply chain of one of the products i.e., billets
which is manufactured in the industry for further examination.

6
 TABLE OF CONTENTS

Title Page No.

Certificate

Declaration

Approval Sheet

Acknowledgements

Abstract

Table of Contents

List of Figures

List of Tables

List of Notations and Abbreviations

Chapter 1 INTRODUCTION

1.1 Lean Manufacturing

1.1.1 Definition

1.1.2 Objectives

1.1.3 5s of lean manufacturing

1.1.4 Important tools of lean manufacturing

1.1.5 Wastes in lean manufacturing

1.2 Supply Chain

Chapter 2 COMPANY OVERVIEW

Chapter 3 LITERATURE REVIEW

3.1 List of Research papers

7
 3.2 Detailed study of the research papers

Chapter 4
4.1 Objectives

4.2 Problem Identification

4.3

4.4 Observations

References

LIST OF FIGURES

Fig. No. Name of Figure Page No.

Fig. 1.1 5’S of lean manufacturing

Fig.2.1 Plant Layout

8
 Fig. 3.1.1 Capabilities of supply chain resilience

Fig. 3.1.2 Current state operation

Outcomes of kaizen and talk time after implementation

Fig. 3.1.3
Lean manufacturing tool(5S)
Fig. 3.1.4
Lean Manufacturing Strategies
Fig 3.1.5
Difference between lean and traditional manufacturing
Fig 3.1.6
Status of different lean strategies as per literature study
Fig 3.1.7

LIST OF TABLES

Table No. Title Page No.

Table 2.1 Company Overview
Table 4.1 Billets Data

9
Table 4.2 Sponge Iron Data
Table 4.3 Scrap Data

CHAPTER 1

10
 INTRODUCTION

1.1 Lean Manufacturing

1.1.1. Definition

Lean production is a Japanese approach to management that focuses on cutting out waste,
whilst ensuring quality. This approach can be applied to all aspects of a business from
design, through production to distribution. Lean production aims to cut costs by making the
business more efficient and responsive to market needs. This approach sets out to cut out all
activities that do not add value to the production process, such as holding of stock repairing
faulty product and unnecessary movement of people and product around the plant.

1.1.2 Objectives

The five main objectives of a lean manufacturing system are:

1. To produce the highest possible quality product,
2. at the lowest possible cost of manufacturing,
3. within the shortest possible delivery time,
4. with the aim of just not satisfying the customer but delighting the customer,
5. And ensuring a very good after sales service.

1.1.3 5S’s OF LEAN MANUFACTURING

11
 Fig. 1.1

1)Sort or Seiri: Removing all clutter from the area.

2)Straighten or Seiton: to set in order the equipment, tools and materials.

3)Shine or Seiso: to clean and check everything.

4)Standardize or Seiketsu: to put in place standard ways of working.

5)Sustain or Shitsuke: to instill self-discipline and make the process part of everyday
practice.

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 1.1.4 IMPORTANT TOOLS OF LEAN MANUFACTURING

Bottleneck Analysis

How many times have your projects gotten stuck somewhere between development and
delivery? Bottleneck analysis is a structured way of looking at the processes and workflows
for developing a product or service. Bottleneck analysis is also used to address both present
and future issues, by identifying and addressing operational and process challenges.

Just-in-Time (JIT)

Just-in-time manufacturing is an on-demand system that allows manufacturers to go into

production only after the customer has requested a product. This means that companies do
not have to stock up on unnecessary inventory, lowering the risk of some components or
products being overstocked or damaged while being stored.

Value Stream Mapping

Value stream mapping is a technique developed from Lean manufacturing. Organizations use
it to create a visual guide of all the components necessary to deliver a product or service with
the goal of analyzing and optimizing the entire process.

Value stream mapping is used in a variety of industries, including manufacturing, finance and
healthcare. This principle takes all the people, processes, information and inventory
necessary, and displays them in a flow chart in order to get an overview of the business.

Kaizen

Kaizen is a Japanese term meaning "change for the better" or "continuous improvement." It is
a Japanese business philosophy regarding the processes that continuously improve operations
and involve all employees. Kaizen sees improvement in productivity as a gradual and
methodical process.

The concept of kaizen encompasses a wide range of ideas. It involves making the work
environment more efficient and effective by creating a team atmosphere, improving everyday
procedures and making a job more fulfilling, less tiring, and safer.

13
1.1.5 WASTES IN LEAN MANUFACTURING

1) Transport- Moving products that are not actually required to perform the processing.

2) Inventory- All components, work in process, and finished product not being processed.

3) Motion- People or equipment moving or walking more than is required to perform the
processing.

4) Waiting- Waiting for the next production step, interruptions of production during shift
change.

5) Overproduction- Producing items more than required at given point of time.

6) Processing- Working on a product more than the actual requirement time is termed as over
processing.

7) Defects- Defects in the processed parts are termed as waste. Repairing the defective parts
or replacing the parts due to poor quality.

1.2 Supply Chain

A supply chain is defined as the entire process of making and selling commercial goods,
including every stage from the supply of materials and the manufacture of the goods through
to their distribution and sale. Successfully managing supply chains is essential to any
company hoping to compete.

Inward Supply Chain

Inward Supply Chain include the movement of raw materials, finished goods, and supplies from a
manufacturer or other distribution channel to a fulfilment center, warehouse, or retail store depending
on the business model.

Outward Supply Chain

Outward Supply Chain are related to the movement of end products to the end user, often originating in a
distribution or fulfillment center and then delivered to its final destination.

14
 CHAPTER 2
COMPANY OVERVIEW

Ramsons Castings Pvt. Ltd. is a leading manufacturer of mild steel long products i.e. Billets,
Flats, Angles, Round Bars, Squares etc. The plant has 4 induction furnaces of 8MT capacity.
The plant has a daily production capacity 200MT and 2 Rolling Mills.

The annual turnover of the company is around Rupees 200 Crores

NAME OF INDUSTRY RAMSONS CASTINGS PVT. LTD.

PRIMARY BUSINESS MILD STEEL PRODUCTS

MANUFACTURING

NUMBER OF EMPLOYEES 400

PRODUCTS M.S. BILLETS, FLATS, ANGLES ETC.

ANNUAL TURNOVER 200 CRORES

AREAS SERVED MAHARSAHTRA, TELANGANA, M.P,

ANDHRA PRADESH, GOA ETC,

Table 2.1 Company Overview

PLANT LAYOUT
15
 Fig 2.1

CHAPTER 3

LITERATURE REVIEW

16
3.1 Detailed study of the research papers

1. Management capabilities in supply chain resilience

By-Christopher and Peck (2004)

Department of Industrial Engineering, Federal University of São Carlos, São Carlos, Brazil

This paper aimed to understand the capabilities that enables supply chain resilience.
And the major capabilities:

 Flexibility (supplier; product; process; transportation),

 Collaboration (information sharing; joined decision making; working together);
 Structure of chain (physical; information)
 and Agility (visibility; velocity) were identified.

17
Fig 3.1.1 -Capabilities of supply chain resilience

18
2. Implementation of Lean Manufacturing Tools in Garment Industry

By- T Saravana Kumar and PR Soumya (2017)

Dept. of Fashion Technology, Sona College of Technology, Salem, Tamil Nadu

For any Company’s economy, the industry cost, production time, total quality management
and waste reduction have great impact. The investments consumed by the company by
eradicating non value added production work and time are very important. Focusing on these
points Lean Manufacturing tools, a Japanese strategy, is implemented in this work.

The bottleneck areas were identified through Value Stream Mapping (VSM) and were
eliminated by implementing line balancing and parallel working section.

OBJECTIVES

● The primary objective of the present study is to investigate the garment manufacturing
processes to identify the bottle-neck operations through lean diagnostic tools, preferably
value stream mapping (VSM).

● Appropriate lean tools are to be implemented until the productivity is improved by

eliminating the waste operations.

PROBLEM STATEMENT

In India due to lower skill levels and traditional manufacturing systems, the garment
industries are able to achieve 50% to 60% productivity level. This project is done in an
apparel industry in Salem, Tamil Nadu, India. They are manufacturers of men formal and
casual shirts. The company has been facing problem with unbalanced productivity among
various operations in sewing department.

To understand the real bottle neck area, the operations analysis for cuff production line and
current state of value stream mapping are created and shown in Fig, respectively.

19
 Fig 3.1.2 Current state operation

The timing has been reduced to 50% by KAIZEN. Now all the operations in the cuff line are
under control and a smooth flow is achieved. The improved takt time details are shown in Fig

Fig 3.1.3 Outcomes of kaizen and talk time after implementation

CONCLUSION

 Thus an apparel industry was studied and the bottleneck areas were identified through
Value Stream Mapping (VSM).

 The bottleneck areas were eliminated by implementing line balancing and parallel
working section. The implementation of kaizen resulted in reduction of cycle time by

20
 48.7%. The value added percentage got increased from 0.397% to 0.431% which
accounts for 8.5% improvement in the processes.

3. Supply Chain Integration and Supply Chain Performance: The Mediating Role of
Supply Chain Resilience
By-Arsalan Zahid Piprani and Suhana Mohezar(2020)

Department of Operations and Management Information Systems, University of Malaya,

Kuala Lumpur, Malaysia

The objective of this study is to examine the influence of supply chain integration (SCI)
on supply chain resilience (SCRES) on supply chain performance (SCP) dimensions of
large – scale manufacturing firms in Pakistan.

It also examines the indirect effects of all the SCI dimensions on all the SCP dimensions
through the SCRES. A quantitative approach using questionnaire survey was employed to
examine the hypotheses and theoretical framework.

Data were collected from 182 manufacturing firms in Pakistan and the SMART PLS
version 3.2.7 was used for data analysis. The results showed that the SCI contributed
significantly to the SCRES while the SCRES impacted on the SCP substantially.

 The findings of this study also highlight the need for manufacturing firms to not only
concentrate on investing in integration practices, but also to take note on how they
could improve their resiliency.
 Resiliency allows the manufacturing firms to handle disruptions effectively, and to
continue to provide the expected services and products to customers.
 Having said this, the resiliency capabilities can be promoted through intense
integration between different units in a firm and with supply chain partners.

Results and analysis

The study employed the SEM (structural equation modeling) by using partial least squared
method for the assessment of the inter relationship among the different latent variables. This
helped to test the theoretical model which has been widely recognized and used in supply
chain risk management and resilience studies.

21
4. Implementing of Lean Manufacturing Tool In Dairy Industry.

By- J Vignesh and B.Varun kumar (2015)

Department Mechanical Engineering Velammal College of Engineering and Technology, Madurai,

Tamil Nadu, India

 Lean manufacturing is a production strategy for organizational effectiveness focusing on

waste reduction and improving productivity through application of various tools.
 This paper attempt to find out the reasons for sparse adoption of the concept in Indian
food processing industries through a cross sectional case study.
 The study highlighted knowledge and understanding levels of Indian industries about the
concept of lean manufacturing, its adaptability, the driving factor that lead to its adoption,
benefits derived and application of lean tools looking into operating environments.

5S (Lean Manufacturing Tool)

5S is the name of a workplace organization method that uses a list of five Japanese words:
seiri, seiton, seiso, seiketsu, and shitsuke. Transliterated or translated into English, they all
start with the letter "S". The list describes how to organize a work space for efficiency and
effectiveness by identifying and storing the items used, maintaining the area and items, and
sustaining the new order. The decision-making process usually comes from a dialogue about
standardization, which builds understanding among employees of how they should do the
work.

Fig 3.1.4 -Lean manufacturing tool(5S)

22
STEPS TO ACHIEVE LEAN SYSTEMS

The following steps should be implemented to create the ideal lean manufacturing system:

1. Design a simple manufacturing system.

2. Recognize that there is always room for improvement.

3. Continuously improve the lean manufacturing system design.

The benefits of this goal include:

 Decreased cycle time.

 Fewer inventories.

 Increased productivity.

 Increased capital equipment utilization.

Analysis

This paper presents the review of lean thinking and its concept through definitions from
literature.

The main focus of lean manufacturing is to eliminate waste, doing things better in half of the
resources as mass production requires, providing higher quality.

Understanding the barriers is important for managers to avoid failures and to sustain lean
leap. The paper contributes by identifying enablers and barriers in implementing the lean
principles and practices.

23
5.A Framework for Effective Implementation of Lean Production in Small and
Medium-sized Enterprises.
By-Fatima Ezzahra Touriki andEl Fezazi (2016)

Industrial Engineering Research Team, Higher School of Technology, Safi, Cadi Ayyad
University (Morocco)

Purpose: The present paper aims at developing an effective framework including all the
components required for implementing lean production properly in Small and Medium-sized
Enterprises.

Research limitations/implications: the proposed framework presents a number of

limitations and still evokes extension for further researches: Although it was derived from
practical experiences of SMEs, the proposed framework is not supported by practical
implementation.

Practical implications: Implementing rigorously the proposed framework will help small
companies’ managers to improve considerably their organization’s performance and benefits
from lean strategies' outcomes. Researchers and practitioners in small businesses now possess
an integral framework for successfully implementing lean strategies.

Analysis

 This paper started with a claim that large companies worldwide were always the most
privileged to adopt many advanced enhancement approaches including lean
implementation and then enjoy advantages resulted by implementation of these
approaches in their organizations compared to SMEs.

 The outcome was a more meaningful framework that groups all the requirements and
guidelines for lean implementation (implementation process, tools and success factors).

 It highlights the successful experiences of small companies in implementing lean

programs and then it proves that lean can give relevant results even for SMEs.

24
25
6. An empirical review of lean manufacturing and their strategies
By-Virender Chahala and M.S. Narwalb (2017)

Research Scholar Department of Mechanical Engineering, Deenbandhu Chhotu Ram

University of Science and Technology, Sonipat, Haryana, India

Lean manufacturing is a discrepancy on the idea of efficiency based on optimizing flow.

Lean manufacturing help to attract manufacturing operations and pick up the industrial jobs
and customer satisfaction (Sing et al., 2010)

Lean Manufacturing Strategies

When lean manufacturing concept was developed the main question was that which strategies
will be more successive for this concept. After study literature, the result was in form of the
number of strategies which can be used here. So this lean concept becomes a flexible system
in which the strategies can be added, merged and be further explored as per requirement.
Some lean strategies are:

Fig.3.1.5 -Lean Manufacturing Strategies

Lean Manufacturing Advantages

According to Forza (1996) and Chahal et al. (2013), lean manufacturing have more
advantages over traditional system. Some reasons are discussed below that why use lean
manufacturing as primary system:

26
 Fig 3.1.6

Fig 3.1.7 -Status of different lean strategies as per literature study

Analysis

 There is no depth of literature on lean manufacturing to give an in-depth details in actual

practice and research area.

 It is accepted that lean manufacturing is the most profitable concept for both,
manufacturing industries as well as customers so lean team prepared by different
manufacturing industries.

 All lean strategies are important at their own levels but these all are not used in all
manufacturing environment. As the result of this research paper, lean manufacturing is
very much important in every area of innovation which provided lean manufacturing
strategies.

27
 CHAPTER 4

OUTLINE OF WORK

4.1 OBJECTIVE

1) To implement lean manufacturing concepts in supply chain of Secondary Steel

manufacturing industry.
2) To ensure quick and smooth flow of materials inside the plant.
3) To ensure minimum number of trucks inside the plant at a time.

4.2 PROBLEM IDENTIFICATION

After examining and analyzing the production and supply chain process of M.S Billets from
raw materials to finished products, we collected data of various processes and identified
wastes (of lean concepts) i.e.

 Waiting Waste – In case of raw materials, after placing the

order for the raw materials such as sponge iron it is not readily
available in some cases and hence there is a delay in receiving
the raw material to the factory. In case of billets, sometimes
trucks have to wait for different sizes of billets for few hours
as that size is not yet produced.
 Processing waste – When Scrap received is of commercial
quality, it has to be unloaded separately to be processed in a
shredding machine which requires the Scrap to be fed to the
machine via overhead crane so this is an extra process only
done for commercial quality scrap.

28
 Billets Data
Sr. Date of order Date of Time load at Time to reach
No. received dispatch factory(Hrs) Mumbai(Hrs)
1 4/30/2021 5/1/2021 1 48
2 4/30/2021 5/1/2021 1 47
3 5/1/2021 5/3/2021 1.5 48
4 5/3/2021 5/4/2021 1.2 48
5 5/3/2021 5/4/2021 1.5 44
6 5/4/2021 5/5/2021 1.5 47
7 5/6/2021 5/7/2021 1 48
8 5/6/2021 5/7/2021 1 48
9 5/6/2021 5/8/2021 1.1 55
10 5/7/2021 5/8/2021 1 54
11 5/8/2021 5/9/2021 1.2 48
12 5/9/2021 5/10/2021 1.3 46
13 5/10/2021 5/11/2021 1 47
14 5/11/2021 5/12/2021 1.5 48
15 5/14/2021 5/15/2021 1 48
16 5/15/2021 5/16/2021 1 47
17 5/16/2021 5/17/2021 1.5 47
18 5/16/2021 5/18/2021 1.1 49
    Average= 1.188888889 48.16666667

Table 4.1 Data of billets

29
 SPONGE IRON
Sr unloading
date of order placed date of truck arrived time taken by truck to arrive
no. time

1 30/04/2021 2/5/2021 45hrs 1hr 10min

2 30/04/2021 3/5/2021 50hrs 1hr 5min
3 30/04/2021 3/5/2021 56hrs 1hr 10min
4 1/5/2021 3/5/2021 39hrs 1hr
5 1/5/2021 4/5/2021 49hrs 1hr 15min
6 3/5/2021 6/5/2021 51hrs 1hr 20min
7 4/5/2021 6/5/2021 40hrs 4hr 30 min
8 6/5/2021 8/5/2021 32hrs 1hr 10min
9 7/5/2021 10/5/2021 57hrs 1hr 20min
10 7/5/2021 10/5/2021 52hrs 1hr 20min
11 8/5/2021 10/5/2021 50hrs 1hr 10min
12 11/5/2021 14/5/21 59hrs 1hr 05min
13 13/5/21 15/5/21 40hrs 1hr 05min
14 13/5/21 15/5/21 37hrs 1hr 05min
15 13/5/21 15/5/21 36hrs 5hr 10min
16 14/5/21 16/5/21 41hrs 1hr
17 14/5/21 16/5/21 42hrs 1hr
18 15/5/21 17/5/21 40hrs 1hr 25min
19 17/5/21 19/5/21 45hrs 1hr 30min
20 17/5/21 19/5/21 43hrs 4hr 40min

Table 4.2 Data of Sponge Iron

Scrap Data

30
Sr. Date of order Scrap Time unload at Time to reach
No. given Received factory(Hrs) Factory(Hrs)
1 When 5/1/2021 3 NA
Available
2 When 5/1/2021 3.5 NA
Available
3 When 5/2/2021 2.5 NA
Available
4 When 5/3/2021 4.5 NA
Available
5 When 5/4/2021 4 NA
Available
6 When 5/5/2021 2.5 NA
Available
7 When 5/6/2021 3 NA
Available
8 When 5/7/2021 3 NA
Available
9 When 5/8/2021 3 NA
Available
10 When 5/8/2021 3.5 NA
Available
11 When 5/9/2021 3 NA
Available
12 When 5/10/2021 3 NA
Available
13 When 5/11/2021 2.5 NA
Available
14 When 5/11/2021 3.5 NA
Available
15 When 5/15/2021 3 NA
Available
16 When 5/16/2021 3 NA
Available
17 When 5/17/2021 5 NA
Available
18 When 5/18/2021 3 NA
Available
19 When 5/19/2021 3.5 NA
Available
20 When 5/20/2021 4 NA
Available

Table 4.3 Scrap Data

31
4.4 OBSERVATIONS

1. Unloading is done by overhead cranes, mobile cranes and is time taking for more number
of packages per truck.

2. System entry and documentation at the gate office is the major contributing factor to truck
turnaround time.

3. The deviation from the mean time taken at gate office is very high.

32
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