Objectives of project:

The main objectives of the project are,

•
To study cost reduction techniques used in Operations/Production.
•
To find out various areas where production cost can be reduce withoutdisconcerting
quality of product.
•
To apply cost reduction techniques to reduce production cost.
•
To increase the profitability of organization.

Need of the project:

There can be following reasons why a company might need to cut costs,
•
To create additional cash reserves
•
To reduce price of product or service
•
To bring expenses in line with revenues
•
To eliminate unnecessary expenses or wasteful spending
•
To increase company value
•
To reduce manufacturing costs to stay competitive
•
To become more efficient

Steps to be follow during project:

While doing project, the following 3 dimensions of Cost reduction has to
consider,1. Internally driven:
•
Keep improving processes
•
Employee suggestions2. Externally driven:
•
Top of the technology and process3. Competitor driven:
•
Benchmarking against competitors
•
Real time data

The steps are,

1.
Personally visit to assembly lines i.e. Trim line and Chasis line of all MUVs of
CVBU plant of Tata Motors, Pimpari.2.List down all electrical equipments  used
in vehicles.3.All data collection has  to do through
Primary data: Data which is collected on our own is called primary data.
•
Personal interaction with company guide.
•
Discussion with other officials.
•
Through observation at actual working place.
•
Discussion with workers working at assembly line and at store.
•
Group discussion with co-trainees.

Secondary data: Already existing data is called secondary data.

•
Manuals of all vehicles.
•
Referring various files already made by companies officers.

4.Present the data in comparative manner according to vehicles.

5.
F i n d   o u t   e q u i p m e n t s   f r o m   l i s t   w h i c h   a r e   m o s t   c o s t l y 
a n d   a l s o equipments which have scope to reduce the cost.6.Do analysis based
on comparison, apply cost reduction techniques and find out cost reduction
elements.

Methodology:
Cost reduction can be done
through,1 . R e d u c t i o n 2 . E l i m i n a t i o n 3 . M o d i f i c a t i o n 4 . I n n o v a t i o n
Following methods of cost reduction in Operations/Production can be
u s e during project,
•
Standardization
•
Lean manufacturing
•
Product rationalization
•
Supply chain management

•
Eliminating wastages
•
Negotiation with supplier
•
Bulk buying from same supplier
•
Replace equipment with low cost product
Limitations:
There is time limitation to actual implementing the ideas
generatedt h r o u g h   p r o j e c t .   A n y   s m a l l   c h a n g e   i n   p r o d u c t   h a s   i n f l u
e n c e   o n   v a r i o u s departments from ERC to Supplier. Hence 2-months span
is short to imply cost reduction ideas. This is also a drawback of large scale company.
But that ideas company can implement in coming days or on their newproducts.