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From these results, they are able to create new systems, processes
or situations for the useful coordination of labour , Materials and
machines and also improve the quality and productivity of systems,

INDUSTRIAL ENGINEERING physical or social.

Depending on the sub-specialties involved, industrial engineering

may also overlap with, operations research, system engineering,
operations management, manufacturing engineering, supply chain
management, management science, financial engineering,
ergonomics, human factor engineering, safety engineering, logistics
engineering or others, depending on the viewpoint or motives of the
user.

Industrial Engineers Work in Many Types of Industries

Industrial Engineers work to make things better, be they
 Aerospace Airplanes  Materials Testing
processes, products or systems Aluminium, Steel
  Medical Services
Typical focus areas include Banking
  Military
 Project Management
 Ceramics  Mining
 Manufacturing, Production and Distribution
 Construction  Oil Gas
 Supply Chain Management
 Consulting  Plastics Forming
 Productivity, Methods and Process Engineering
 Electronics Assembly  Retail
 Quality Measurement and Improvement
 Energy  Shipbuilding
 Program Management
 Entertainment  State Federal
 Ergonomics/Human Factors
 Forestry Logging  Government
 Technology Development and Transfer
 Insurance  Transportation
 Strategic Planning
 Financial Engineering

Industrial engineering is an engineering profession that is Some Techniques Utilized by Industrial Engineers
concerned with the optimization of complex processes, systems or
Benchmarking Organizational Analysis
organizations by developing, improving and implementing integrated  

Design of Experiments Pilot Programs

systems of people, money, knowledge, information, equipment,  

Employee Involvement Plant Equipment

energy and materials.
 

 Equipment Utilization  Layout

 Flow Diagramming  Project Management
Industrial engineers use specialized knowledge and skills in the  Information Data Flow  Simulation

mathematical, physical and social sciences, together with  Diagramming  Six Sigma projects

the principles and methods of engineering analysis and design, to  Interviewing for  Statistical Analysis
Information Strategic Planning
specify, predict, and evaluate the results obtained from systems and  

Lean Manufacturing Theory of Constraints

processes.  

 Modeling Testing  Time Studies

 Operations Auditing  Work Sampling
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Historical Development of Operation

INPUT(S)
Transformation
OUTPUT(S) Management - Japan
-Men Useful
-Machines Economic/Social/Political Goods or Phase – 1
Environment Services
-Materials -dynamic
-Money -uncertain
Immediately after world war – II
-Information FEED BACK
-Energy Concentrated on achieving competitiveness through low labour cost.
---------- Undesirable
outputs Targets – Industry with high labour cost – Textile, ship building, steel
(Effluents, Fumes etc.) Results – Increase in market share

A PRODUCTION SYSTEM AS
AN INPUT-OUTPUT SYSTEM

HISTORICAL DEVELOPMENTS (1)

Historical Development of Operation
• Adam Smith, 1776 - Father of Scientific Management, Wrote Wealth Management - Japan
of the Nation. 20 Pins per day to 4800 Pins per day.
• F. W. Taylor, 1896 - Improvement in Work Content, Specialization and PHASE 2
Division of labour. Loading Pig Iron onto rail cars • Early 1960s
• Gilberth and his Wife 1911- Micro motion study • Rise in wages, increase in inflation,
• Henry L. Gantt, 1913 - Planning and Scheduling of the activities • Advantage of cheaper labour eroded.
• Very less increase in productivity to offset increase in labour
cost.
• Result – loss of competitive edge, decrease in market share, loss
in volume, profits, position and prestige.

HISTORICAL DEVELOPMENTS (2)

Historical Development of Operation
• Harris, 1917 - Inventory Control Management - Japan
• 1940s - Conceptual foundation for Value Engineering, System
Analysis, Operations Research emerged. PHASE 2
• Shift in focus/strategy
• W. A. Schewart, 1924 - Fundamental Concepts of SQC.
• Used capital investments to boost work force productivity.
• Elton Mayo, 1927-33 - Hawthorne Experiments , illumination • Scale based strategies.
Experiments • Achieved high productivity, low cost by building the largest and most capital
intensive facilities.
• Barnes, 1933 - Work Study
• Henry Ford, 1913 - First Moving Assembly Line
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Historical Development of Operation

Management - Japan
TYPES OF PRODUCTION SYSTEMS
Phase -3
• Mid 1960s • Continuous Production System
• Customers demanded variety.
• Mass Production System (Flow Line Process)
• Shift in strategy – Focused factory with low variety, high productivity. (Focused
factories were inflexible).
• Batch Production System

(Volume in doubled - 15% to 20% reduction in cost/unit) • Job Shop Production System
(Variety is doubled - 20% - 35% increase in cost/unit)
• Fixed Location Production System (Project Shop)

PRODUCT-PROCESS MATRIX FOR PROCESSES

Historical Development of Operation Less Customization and Higher Volume

Management - Japan (1)

One of a kind
(2)
Low volume,
Product Design
(3)
Multiple
(4)
Few major
(5)
High volume

Phase -4 Process
products, made
to customer
order
low
standardization
products
moderate
volume
products,
higher
volume
high
standardization,
commodity
Characteristics products
• JIT/Toyota production system.
Less Complexity, Less Divergence, More Line Flows

(1)
Complex and
Project
• Variety war – flexible factory (variety driven cost is less)
highly customized
process, unique process
sequence of tasks

• Automotive suspension (2)

Jumbled flows, Job
complex work with process
USA : 10million units/day, 11 types, world largest plant
many exceptions

(3) Batch
Disconnected line
JAPAN : 3.5 million units/day, 38 types, flows, moderately
complex work
process

Unit cost less than half of USA (4)

Connected line,
Line
process
routine work

• Productivity of direct workers low but advantage from indirect workers. (5) Continuous
Continuous
flows, highly
process
Only 1/18 of USA repetitive work

Historical Development of Operation VOLUME VARIETY GRAPH

Management - Japan
MASS
PROD.
Honda –Yamaha war (Y – M war) in 1981
• Honda target of 60 models in next 18 months, introduced 113 Yamaha BATCH
targeted 60 models, introduced only 37. VOLUME
PRODUCTION
• Variety leads to fashion,
technology up gradation, composites, direct
drive, four stroke engines.
JOB SHOP PRODUCTION

VARIETY
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TYPES OF PRODUCTION SYSTEMS

STAGE I : MAJOR CONSIDERATIONS
• JIT Production System
• Future long term trends of growth
• Lean manufacturing System
• New Products
• Flexible Manufacturing System
• Technologies
• Agile Manufacturing System
• Consumer Preference Patterns
• Quick Response Manufacturing
• Industrial Climate
• e- Manufacturing
• Govt. Policies
• Supply Chain Management/ Value Chain Management
• Basic Desire, Commitment, Experience
• Virtual Manufacturing
• Available or Projected Resources

COMPETITIVE PRIORITIES
Corporate strategy Market analysis
•environmental scanning •segmentation
•core competencies •needs analysis
•core processes
•global strategies
Competitive
priorities
•cost
•quality
•time
•flexibility

LIFE CYCLE APPROACH COMPETITIVE PRIORITIES

STAGE I Corporate strategy Market analysis
•environmental scanning •segmentation
•core competencies
STAGE DECISION •core processes
•needs analysis
Coststrategies
•global 1. Low-cost operations
What are the Quality 2. Top quality Competitive
BIRTH OF Corporate Goals? 3. Consistent quality priorities
SYSTEM Time 4. Delivery speed •cost
What Product or 5. On-time delivery •quality
Service? 6. Development speed •time
Flexibility 7. Customization •flexibility
8. Variety
9. Volume flexibility
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Corporate Strategy
•Products
LIFE CYCLE APPROACH
•Markets STAGE III
•Order winning Dimensions
•Philosophy and Policies STAGE DECISIONS
 Facility Location
Operations Strategy Marketing Strategy
•Cost/ flexibility •Products/ Markets DESIGN OF  Physical Arrangements
•Technology and Processes
•Location
•Pricing / Promotion
•Customer service THE SYSTEM to adodt
•Quality  How to determine
•Human Resource demand for product or
Relationship among Organization, Operations and Marketing Strategy
service

LIFE CYCLE APPROACH

STAGE III : MAJOR CONSIDERATIONS
STAGE II

•SURVEYS AND FEASIBILITY STUDIES

STAGE DECISIONS •ECONOMICS OF

• MASS PRODUCTION
DESIGN OF  Technological Design of • BATCH PRODUCTION
PRODUCT OR Product (Form , Appearance)
• JOB PRODUCTION
SERVICE
• PROJECT PRODUCTION
 Selection of M anufacturing
PROCESS Technology •LAYOUT PLANNING
SELECTION  Sequence of Operations •QUALITY ASSURANCE

•DEMAND FORCASTING

STAGE II : MAJOR CONSIDERATIONS

• During Design of Product or Service
LIFE CYCLE APPROACH
• Customer Needs STAGE IV
• Behavior of Materials
• Available Processes of Manufacture STAGE DECISIONS
• Economics
 What job is each worker to
• During Process Selection perform?
• Available Technologies MANNING  How will the job be performed?
• Economics THE SYSTEM - Methods Study
• Required Specifications  Measured?
- Work Measurement
 How will works be compensated?
- Wage Incentives
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STAGE IV : MAJOR CONSIDERATION

STAGE VI : MAJOR CONSIDERATIONS
• WORK MEASURMENT
• SETTING PRODUCTION TARGETS
• SETTING OF PRODUCTION STANDARDS • SCHEDULING, SEQUENCING OF JOBS
• INVENTORY CONTROL
• WAGE INCENTIVES
• QUALITY CONTROL
• CAPACITY DETERMINATION • PRODUCTION CONTROL
• COST CONTROL
• PLANNING RESOURCE ACQUISITIONS
• MAINTENANCE

LIFE CYCLE APPROACH LIFE CYCLE APPROACH

STAGE V
STAGE VII
STAGE DECISION
 INITIAL PROBLEMS
START UP STAGE DECISIONS
OF SYSTEM
 HOW LONG WILL IT TAKE  How do you revise
TO REACH DESIRED STATE ? Revision of the the system in light of
system external changes?
Problems of
•Installation •Coordination

•Training of Personnel •Learning Phase

LIFE CYCLE APPROACH STAGE VII : MAJOR CONSIDERATIONS

STAGE VI

STAGE DECISION • New technological Threats / Opportunities

 How to run the System? • Revision of Market Demand

• Newer Products
SYSTEM IN  How to improve the System?
STEADY • Technological Innovations
 How to deal with day to day
STATE Problems? • Newer Methods of Manufacture/ sell/ service
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LIFE CYCLE APPROACH STAGE VIII The Organizational Lifemap

Summer

PRUNE Fall
Spring
PULL
PLANT

STAGE DECISIONS
Winter

PLAN

 How does a
TERMINATION System Die?
OF THE SYSTEM  What can be
done to salvage Today Future

resources? Timeline

Plan in winter, plant in spring, prune in summer and pull in fall to

maximize the seasons of your life and your organization’s

STAGE VIII : MAJOR CONSIDERATIONS

The Organizational Lifemap
• MANNER OF PHASE OUT Summer

Fall
Spring

• SELLOUT / MERGER Winter

• START A NEW PRODUCT

Today Future

Timeline

Go to your second curve while at peak so that the resultant curve

is always improving.

The Organizational Lifemap The Organizational Lifemap

Summer

Fall
Spring
Summer

Winter Fall
Spring

Winter

Today Future

Today Future Timeline

Timeline
Ever-increasing resultant curve.
There are 4 seasons in your organization’s lifespan.