Introduction of Industrial

Management
By: Dr. Vikas Bansal
 Industrial Engineering
Definition:
American Institute of Industrial Engineers (AIIE) defines
Industrial Engineering that it is concerned with the design,
improvement and installation of integrated system of men,
material and equipment. It draws upon specialized knowledge
and the skills in the mathematical physical science together with
the principals and methods of engineering analysis and design to
specify, predict and evaluate the results to be obtained from
such systems.
Objectives of IE
The main objectives of industrial engineering are:
1- Helping the organization achieving its goals by planning its operations
and contingencies.
2- Improving the organization performance by increasing its productivity,
quality and competitiveness.
3- Improving the effective utilization of resources and time. Eliminating
waste.
Management Components
• Planning
• Organizing
• Staffing
• Directing*
• Motivating
• Leading
• Controlling
 IE Work Tools:
• Basic Economics and Finance tools
• Human factor management tools
• Mathematical models (i.e. Optimization)
• Information Systems tools
• Engineering (physics, drawing,
specifications)
• Decision making
• Management tools (e.g. Project management)
 Techniques of Industrial Engineering
Following tools and techniques are used to improve productivity of the organization by
optimum utilization of resources.
1- Method Study.
2- Time Study (Work Measurement).
3- Motion Economy.
4- Financial and Non Financial Incentives.
5- Value Analysis.
6- Production, Planning and Control.
7- Inventory Control.
8- Job Evaluation.
9- Material Handling Analysis.
10-Ergonomics (Human Engineering).
11- System Analysis.
12- Operations Research Techniques.
Historical Chronological Review of IE Development
1911-F. Taylor published "The Principles of Scientific Management". Management as a well
defined methodology that involves quantitative measures.
1913-Henry Ford - The integrated assembly line. The integration between work stations to
reduce the average time per car. At the beginning of 1913 the time per car was 12.5 hours, 8
months later it was reduced to 93 minutes.
1917- Harris- Inventory Management Model
1930s - Howthorn (Harvard) trials for measuring the effects of environmental changes on
workers' performance.
1930s - Significant advance in applying SPC and Statistical analysis in Quality Control (QC).
1940s - Birth of Operations Research (OR) Mathematical models for optimizing operational
plans.
Historical Chronological Review of IE Development

1950s and 1960s - The birth of the integrative approach, and the Industrial Engineering as
profession.1970s and 1980s - Computerization of data and operations research. Computer based
management tools. Material Requirement Planning (MRP) systems.
1980s and 1990s - Most organizations adopt philosophical tools such as JIT (Just In Time), TQC
(Total Quality Mgt.), and Six Sigma. The MRP systems extend to MRP-II.
2000s - ISO-9000, ERP systems, Supply Chain information sharing, search-based optimization.
2010s Analytics, Cloud computing, Big data, Data mining.
Role of an Industrial Engineer
Typical focus areas include:
• Project Management
• Manufacturing, Production and Distribution
• Supply Chain Management
• Productivity, Methods and Process Engineering
• Quality Measurement and Improvement
• Program Management
• Ergonomics/Human Factors
• Technology Development and Transfer
• Strategic Planning
• Management of Change
• Financial Engineering
 Project Management
• Develop the detailed work breakdown structure of complex activities and form them into
an integrated plan
• Provide time based schedules and resource allocations for complex plans or
implementations
• Use project management techniques to perform Industrial Engineering analysis and
investigations
• Conduct facility planning and facility layout development of new and revised production
plants and office buildings
• Form and direct both small and large teams that work towards a defined objective, scope &
deliverables
• Perform risk analysis of various project options and outcomes
 Manufacturing, Production and Distribution

• Participate in design reviews to ensure manufacturability of the product

• Determine methods and procedures for production distribution activity
• Create documentation and work instructions for production and distribution
• Manage resources and maintain schedule requirements to meet required production
and distribution schedules
• Process Optimization utilizing Simulation tools (Arena, etc).
• Facilitate and Lead process improvement teams
Supply Chain Management
• Manage Supplier relationships
• Managing and report on company Supplier Cost /Performance Indices to
management
• Audit Suppliers and ensure supplier processes and procedures are being followed
• Travel to suppliers to resolve issues
• Coordinate first article Inspections
• Work with Outsource Manufacturers to ensure product quality, delivery and cost,
is maintained
 Productivity
• Productivity is a measure of how well resources are utilized to produce output.
• Productivity is a measure of output from a production process, per unit of input.
• In other words Productivity may be defined as the ratio of output/input.
• In engineering the ratio of output/input is termed as efficiency however in production system this ratio is
known as production efficiency or productivity.
• Productivity can also be defined as human efforts to produce more and more with less and less inputs of
resources.
According to Peter Drucker, "Productivity means a balance between all factors of production that will give the
maximum output with the smallest effort".
• European productivity council defines, "Productivity is an attitude of mind. It is a mentality of progress, of the
constant improvement of that which exists. It is certainty of being able to do better than yesterday and
continuously.
 Work Study
Work study is one of the most important management techniques which is employed to improve
the activities in the production.
• The main objective of work study is to assist the management in the optimum use of the human
and material resources.
• It has three aspects:
➢ More effective use of plant and equipment.
➢ More effective use of human effort.
➢ Evaluation of human work.
• Work study is simply the study of work. It is the analysis of work into smaller parts followed by
rearrangement of these parts to give the same effectiveness at lesser cost.
• It examines both the method and duration of the work involved in a process.
 Importance/objectives of work study:

• It is a mean for raising productivity of an industry by re-organization of the work, involving

little or no capital expenditure at all.
• It is used to determine the standards of performance.
• It results in better workplace layout, neat and clean working environment resulting in minimum
movement of workers and materials.
• It results in saving and efficient use of human and material resources by increasing output and
reducing scrap, rework etc.
• It eliminates unnecessary human movements.
• Results in improved safety.
• Reduction in fatigue and health hazard.
 METHOD STUDY:
• Method study is the systematic recording and critical examination of existing and proposed
ways of doing work as a means of developing and applying easier and more effective methods
and reducing cost.

Objectives of Method Study:

• The improvement of processes and procedures.
• The improvement of factory, shop and work place layout and of the design of plant and
equipment.
• Economy in human effort and reduction of unnecessary fatigue.
• Improvement in the use of materials, machines and manpower.
• To find the best way of doing a job.
• To standardize the best method.
• Reduction of waste and scrap, improvement in quality.
• Greater job satisfaction, higher standards of safety and health
Basic procedure for method study:
1. Select: the work to be studied.
2. Record: all the relevant facts of the present method is observed.
3. Examine: The purpose, place and sequence of every operation should be critically
examined. This will reveal defects in existing methods.
4. Develop: the most practical, economical and effective method considering all the
circumstances.
5. Define: the new method is defined.
6. Install: that method as standard practice.
7. Maintain: that standard practice by regular routine checks.
RECORDING TECHNIQUES:

• The next step in the basic procedure, after selecting the work to be studied, is to record
all the facts relating to existing method.

• Purpose of recording can be summarised as follows:

➢ To enable the process to be clearly understood.

➢ To present the existing facts for analysis.

➢ To submit the proposals to the management in a form which can be easily understood.

➢ To guide supervisors and operators regarding detailed operating instructions.

RECORDING TECHNIQUES (CONT.):

• According to the nature of the job being studied and the purpose for which the
record is required, the following are the most generally used techniques:

➢ Charts: Indicating process sequence.

1. Outline process chart.

2. Flow process chart.

3. Two - Handed process chart.

➢ Diagrams indicating movement and models:

1. Flow diagrams.

2. String diagrams.
PROCESS CHARTS:
• The construction and interpretation of process charts are simplified by the use of two or more of
the following symbols.
• These symbols divide the task selected into five functions and all activities can be so divided.
1. Outline process Chart:
• The outline process chart gives the overall picture of the process.
• It is a graphic representation of the points at which materials are introduced
into a process and of the sequence of all operations and inspections associated
with the process.
• The general flow of the process is indicated by vertical lines, while horizontal
lines indicate the material being introduced.
• The chart does not show where work takes place or who performs it.
• It is only concerned with operations and inspections, hence only two of the five
symbols are used in this type of chart.
2. Flow Process Chart:

• Flow process chart is defined as a graphic representation of all operations, inspections,

transportations, delays, and storages occurring during a process or procedure which includes
information necessary for analysis such as time required, quantity and distance moved etc.
• Types:

➢ Man type - It records what the worker does.

➢ Material type - It records what happens to the material.
➢ Equipment type - It records how the equipment is used.

• Flow process chart is an amplified form of operation process chart.

• All the detailed information regarding the process is to be recorded i.e. all the five symbols
are used to write down the details of the activity.
• This chart is very important for the analysis purpose because it gives a complete picture of
what is being done and helps the man to understand the facts and their relationship to one
another.
• Wherever the transportation symbol is used, the actual distance covered by man, material or
machine should be recorded.
3. Two Hand Process Chart: (Left- and Right-Hand Process chart):
• After studying the operation process chart and flow process chart, it is the proper time to investigate the
specific operation in order to improve it.
• It is a motion study where the study is done to analyse the motions used by the worker in performing an
activity.
• The objective of this investigation is to eliminate or reduce the unwanted motions and to arrange the
remaining motions in a best sequence.
• The two-hand process chart is “a chart in which the activities of a worker’s hand are recorded, in their
relationship to one another.
• It is commonly used for short and repetitive operations.
• Procedure for preparing two-handed process chart:
1. Before start of recording, study the operation cycle few times.
2. Observe one hand at a time and record.
3. Record few symbols at a time.
4. Start observing and recording at a position which could be easily distinguished. The action of picking up or
DIAGRAMS:
• Flow process chart only shows the sequence of various activities necessary for performing
the specified work. It does not show clearly the path of movement of men and materials
from one location to another.
• The path of movement (i.e. movement between two locations and the number of times a
movement is repeated) can be better visualized by flow diagrams, string diagrams or
models.
• The flow diagram is used to supplement the flow process chart.

flow diagram:
• It is a drawing or diagram which is drawn to scale.
• It shows the relative production machinery, jobs, fixtures, etc., and marks the paths
followed by men and materials.
• The routes followed in transport shown by joining the symbols in sequence by a line which
represents as nearly as possible the path movement of the subject concerned.
Steps in drawing a flow diagram:
1. Draw to scale the plan of the work area.
2. Mark the relative positions of machine tools, benches, stores, racks, inspection
booths, etc.
3. From the different observations, draw the actual movements (paths) of the material
or the worker on the diagram and indicate the direction of movement.
4. Each movement is serially numbered and indicated by an arrow for its direction.
5. Different colours are used to identify different types of movements e.g. worker with
empty trolley, worker with loaded trolley etc.
String diagram:
• String diagram is a scale layout drawing on which length of a string is used to record the
extent as well as the pattern of movement of a worker.
• String diagram is a model or scaled plan of the shop, in which every machine or equipment is
marked and a peg/pin is struck in the area representing the facility.
• It is especially valuable where journeys are irregular in nature.
• The main advantage of string diagram over flow diagram is that repetitive movements
between workstations are difficult to be traced on the flow diagram can conveniently shown on
string diagram.
• When there is too much of movement involved then, a flow pattern may become unreadable.
• The flow diagram makes use of pencils or pens to draw the path of the men or material
whereas the string makes use of threads to draw the same.