BGDBW

WATCH MANUFACTURING
PLAN
2001-02
WATCH MANUFACTURING PLAN 01-02
KEY FOCUS AREAS

ALIGN PRODUCTION TO SALES DEMAND
DEVELOP FLEXIBILITY TO MEET FLUCTUATION IN DEMAND
REDUCE RESPONSE TIME TO MARKET
AGGRESSIVELY DRIVE DOWN COSTS
LEVERAGE CORE COMPETENCIES TO EXPLOIT NEW BUSINESS
OPPORTUNITIES
UPGRADE EMPLOYEE SKILLS, INCREASE MOTIVATION AND
IMPROVE PRODUCTIVITY
INHOUSE QTY - K GROWTH %
WATCH PRODUCTION 6710 6.2

MOVEMENT PRODUCTION 6000 13.2
METALLIC CASES 4260 17.8
JEWELLERY CASES 14 --
PLASTIC CASES 445 12.6
PLASTIC STRAPS 330 9.3
SOLID LINK BRACELETS 150 80.7
SHEET METAL STRAPS 1600 25.1
BOUGHT OUT QTY - K GROWTH %
CASES
METAL 1889 -10
PLASTIC 145 -3
MOVEMENTS 685 -51
STRAPS 1785 -18

FOCUS ON
 RESPONSE TIME
 FLEXIBILITY
 ALIGNMENT
 INVENTORIES
INITIATIVES
 CELLULAR LAYOUTS
 AUTOMATION PROJECTS
 DEDICATED PRODUCTION LINES
 SMALL BATCH PRODUCTION
 SETUP TIME REDUCTION
 SUPPLY CHAIN MANAGEMENT
 FOCUSSED ASSEMBLY LINE FOR NEW MODELS
 LIQUIDATING SLOW & NON-MOVING STOCKS
 JIT FOR BOUGHT OUT ITEMS
 SELF CERTIFICATION OF SUPPLIERS
 WEEKLY REVIEWS
TOTAL (LIVE) MONTH AVERAGE

(NUMBERS) (NUMBERS)
WATCH VARIANTS 1900 900

CASE 600 300
DIAL 1500 800
MODULE 58 45
HAND 355 210
STRAP 640 350
CROWN 60 40
CATEGORY RESPONSE % OF PRODUCTION

TIME (DAYS) 01-02 00-01
56% 38%
CRP 7 10 9
MTI 30 46 29
MTI 60 22 41
MTO 60 11 15
MTCI 90 4 4
New 7 2
Total 100 100
 LEAD TIME REDUCTION
01-02 00-01
<----DAYS---->
WATCH ASSEMBLY 4.5 6.0
CASE MFG 20 TO 30 36 TO 45
MAIN PLATE 45 67
BO CASE,DIAL,STRAP 30 TO 45 45 TO 70
 FLEXIBILITY IN DELIVERY – 350K TO 700 K / MTH
WATCH ALIGNMENT
TARGET ACTUAL ACTUAL

01-02 00-01 99-00
DOMESTIC
TRADE 85% 83% 74%
CSD 90% 90% 83%
INSTITUTIONS 100% 97% 91%
EXPORT
TIME 90% 85% 81%
TIML 90% 87% 83%
TAPL 90% 89% 82%
INVENTORIES
DESCRIPTION 2000-01 TARGET
2001-02
PRODUCTION (K) 6320 6710
INVENTORY (RS CR)
RM + BOUGHT OUT 23 22
IN-HOUSE WIP 45 43
TOTAL 68 65
INVENTORY 80 68
HOLDING DAYS
QUALITY
QUALITY IMPROVEMENT INITIATIVES
 SELF CERTIFICATION OF VENDORS
 VENDOR EDUCATION & TRAINING
 PRODUCT/PROCESS REDESIGN
 MONITORING CP/CPK FOR CTQ CHARACTERISTICS
 DESIGN OF EXPERIMENTS
 IMPROVING NEW PRODUCT RELIABILITY
 MONITORING COQ
QUALITY FOCUS- YIELD (%)
01-02 00-01
MOVEMENT PLANT
MAIN PLATE 98.3 97.6
STEPPER MOTOR 95.0 94.0
OTHER COMPONENTS 98.5 98.0
CASE PLANT
STEEL CASES 95.0 93.0
BRASS CASES 90.0 88.0
SOLID LINK BRACELETS 97.0 95.0
SHEET METAL STRAPS 98.5 98.0

TOOL ROOM 99.3 99.2
RUNNING TEST 99.5 99.2
FINANCIAL IMPACT > RS 30.0 LAKHS
REDUCE MARKET RETURNS - WITHIN GUARANTEE PERIOD
TARGET : < 2.0 PER 1000 FROM CURRENT 2.03 PER 1000
 CATEGORY-WISE TRACKING AND ANALYSIS OF FIELD

RETURNS
 ANALYSING AND MONITORING COST OF GUARANTEE

RETURNS
 NEW PRODUCT RELIABILITY IMPROVEMENT THRO

FINITE ELEMENT ANALYSIS SOFTWARE FOR
RELIABILITY TESTING
COST OF QUALITY
00-01 (RS CR) % ON T/O % ON MFG COST
(RS 492 CR) (RS 284 CR)
PREVENTION 3.11 0.63 1.09

APPRAISAL 2.36 0.48 0.83
INTERNAL FAILURE 10.96 2.23 3.85
EXTERNAL FAILURE 2.92 0.59 1.03
ADMINISTRATION 2.15
GUARANTEE FULFILLMENT 0.77
TOTAL 18.46* 3.93 6.80
* TARGET 01-02 - TO REDUCE BY 5%
SEIKO, JAPAN - BATTERY UNIT - TOTAL COQ- 1.5%

TVS SUZUKI - EXTERNAL FAILURE - 1.0%
COST REDUCTION
INITIATIVES
PRODUCT RE-ENGINEERING INITIATIVES
 BULK PRODUCTION OF HYBRID 6000

 OPTIMISING RAW MATERIAL SPECS FOR TURNED
COMPONENTS
 INTERNALISATION PROGRAM
 CASES, BRACELETS, STRAPS, BUCKLES, CLASPS
 TOOL ELEMENTS
 PLASTIC MOVEMENT COMPONENTS
 BRASS CASES TO SS TO REDUCE PALLADIUM NICKEL
 STANDARDISATION OF TOOL ELEMENTS
PROCESS RE-ENGINEERING INITIATIVES
 CELLULAR LAY OUT
 INSTALLATION OF LINEAR TRANSFER MACHINE FOR MAIN

PLATE MFG
 USE OF INDIGENOUS SS RAW MATERIAL FOR CASES
 CRYOGENIC TREATMENT OF TOOLS
 SEPARATE LINES FOR MACHINING & SUB-ASSEMBLY AT EBAUCHE
 PRODUCTIVITY IMPROVEMENT IN ION PLATING
 ESTABLISHING MFG PROCESS FOR 14 kt YELLOW, WHITE & ROSE GOLD
 ESTABLISHING MFG OF LIGHT WEIGHT GOLD BRACELETS THROUGH FURNACE

BRAZING TECHNIQUE
 TPM
 RANKING OF MACHINES
 IMPROVING OEE OF CRITICAL MACHINES

 ROOT CAUSE ANALYSIS TO DEVELOP COUNTER MEASURES
 AUTONOMOUS MAINT. TO SUSTAIN COUNTER MEASURES
 PLANNED MAINTENANCE & MOVING FROM PREVENTIVE TO
PREDICTIVE MAINTENANCE
 RELIABILITY ENGINEERING – MODIFICATION OF M/CS
 IMPROVING MTBF & MTTR OF TPM M/CS
CURRENT TARGET 01-02
MTBF : MOVT PLANT 296 HRS 1500 HRS

CASE PLANT 200 HRS 1000 HRS
MTTR : MOVT PLANT 3 HRS 1.5 HRS

CASE PLANT 9 HRS 4.5 HRS
OVERHEAD REDUCTION INITIATIVES
 SENIOR LEVEL CROSS FUNCTIONAL TEAM
 PRODUCTIVITY IMPROVEMENTS
 MANPOWER REDEPLOYMENT - NO RECRUITMENT
 CONSERVATION OF POWER, FUEL, WATER-EMS

CERTIFICATION
 REDUCTION IN COMMUNICATION & TRAVEL COSTS

UNIT OVERHEAD REDUCTION
01-02 00-01
OVERHEAD BUDGET (RS CR) 106 105
PRODUCTION (K) 6710 6320
OVERHEAD/WATCH (RS) 158 166
PERCAPITA OUTPUT (NOS/YR) 2750 2550
NOTIONAL SAVINGS RS 540.0 LAKHS

 MATERIAL BUDGET - Rs 178 Cr (INCL NEBULA & DIGITAL)
01-02 00-01 CHANGE

MAT COST/WATCH Rs 254* Rs 239 +6.2%
GROSS CONTRIBUTION Rs 206 Rs 183 +12.6%

* - INCREASE DUE TO RICHER PRODUCT MIX
 SAVINGS BUDGET (Rs LAKHS)

ASSEMBLY - 24.00 122.00
MOVEMENT - 104.00 42.00
CASE - 236.00 887.00
BRACELET - 35.00 169.00
MATERIALS - 109.00 185.00
CFT - 30.00 --
TOOL ROOM - -- 13.00
ECB - 62.00 56.00
TOTAL - 600.00 1474.00
5120 MOVEMENT COST
(2 Hands t=2.6 mm)
180
170
160
150 138
140 125 123
130
122 120
120 111
C os t in R s .
110
62 95
100
90
60 59 59 57 46
80
70 44
60
50
40 76
30 65 64 63 63 65
51
20
10
0
94-95 95-96 96-97 97-98 98-99 99-00 00-01
Total 138 125 123 122 120 111 95
OH 62 60 59 59 57 46 44
Material 76 65 64 63 63 65 51
Comparision of 5120 inhouse
Movement Cost & Bought Out
200
180 MATL OH FOB CUSTDUTY

153
160 150 150
138
140
Rs . p e r p ie ce
41 41 41
120 37 112
95
100 30
80
44
60 112
101 109 109
40 82
51
20
0
TITAN FE 5120D CITIZEN RONDA 751 TMVX10 ETA
METAL GY20 HYB PLASTIC
7022/7122 MOVEMENT COST
(3 Hands+Day+Date t=3.4 mm)
180
170
160
151
150
141 140 140 139
140
130
118 118
C os t in R s .
120
110 85
100 80 80 80 75
90 49 53
80
70
60
50
40
66 64 69 66
30 61 60 60
20
10
0
94-95 95-96 96-97 97-98 98-99 99-00 00-01
Total 151 141 140 140 139 118 118
OH 85 80 80 80 75 49 53
Material 66 61 60 60 64 69 66
Comparision of 7022 inhouse Movement Cost
and Bought Out
MATL OH FOB CUSTDUTY TOTAL
Rs. per piece
350
282
300
250 76
183 172
200 136
128 120
121 50
150 119 47
37 35
100 53 206 33 33
133 125
50 88 99 93 87
66
0
TITAN
(83/4")HYBRID
(83/4")PLASTIC
(101/2")HYBRID
(10 1/2")METAL
(10 1/2")METAL
(10 1/2")METAL
(103/4")PLASTIC
Citizen1M02
ISA 389/104
ETA 803
Ronda 507
FE 7122
ETA 955
TM VX33
Benchmarking of In-house case price
In-house Bought-out (sources from Honkong)
Variable Fixed FOB Custom Duty Value in Rs.
450
392
400
353
350 311
125
300 113
V alue in R s ./C as e
220 214 99
250
174 181
200 125 127

70 68 119
102 110 108
98 89
150 56 58
65 267
240
40 48 212
100 35 56
49
51 150 146
44 67
119 123
50 37 85 79 73 63
60
47 45
28 35
0
INH B/O INH B/O INH B/O INH B/O INH B/O INH B/O INH B/O INH B/O
BS RD 2PC BS RD 3PC BS SH 2PC BS SH 3PC SS RD 2PC SS RD 3PC SS SH 2PC SS SH 3PC
RESEARCH
&
DEVELOPMENT
 SKELETON WATCH - TITANIUM

 7000 SERIES MOVEMENT WITH BIG DATE
@ RS 135/- (IMPORTED MOVT. LC RS 180~190)
 NEW CONCEPTS
 DIGITAL ADD ON MOVEMENTS FOR FASTRACK
 DISPLAY OF DATE (PERPETUAL) & SECONDS BY LCD-
ANADIGI
 LONG BATTERY LIFE MOVEMENT
 JOINT DEVELOPMENT WITH IISC
• PLANAR MAGNET TO ELIMINATE COIL WINDING

 LITHOGRAPHY FOR STATOR, COIL & TOOL ELEMENTS
 ELIMINATION OF QUARTZ CRYSTAL THROUGH IC
 PHOTO-VOLTAIC CELLS
 THIN FILM LITHIUM ION BATTERY
 DIRECT PVD ON BRASS
CAPEX
CAPITAL EXPENDITURE
 FOCUS ON PRODUCTIVITY IMPROVEMENT AND CAPACITY

BALANCING
 WATCH ASSEMBLY - 8.0 M

 MOVEMENT PLANT - 6.0 M
 CASE PLANT - 4.3 M
 INVESTMENT PLAN OF RS 668 L
 MACHINE BUILDING ACTIVITIES TO SAVE RS 363 L

NEW BUSINESSES
 PRECISION PRODUCTS
 AUTOMOTIVE
 DEFENCE & SPACE

NEW BUSINESS OPPORTUNITIES

Rs Lakhs
CUSTOMER PRODUCT BUSINESS PLAN IN
RANGE IN 2000-01 2001-02
HAL COMPONENTS 1 160
FOR DEFENCE
APPLICATIONS
VISTEON POINTERS 27 27
PLASTIC PARTS
MOULDS 6 --
VDO POINTERS 10 193
PLASTIC PARTS
TURNED PARTS
PRESSED PARTS
MOULDS
CINCH TURNED PARTS 0 20
TOTAL 44 * 400
* - RS 250 LAKHS W/O INVESTMENT

TBEM
TBEM APPLICATION - 1997 / 1999 / 2000 / 2001
LEADERSHIP
STRATEGIC PLANNING
CUSTOMER AND MARKET FOCUS
INFORMATION AND ANALYSIS
HUMAN RESOURCE FOCUS
PROCESS MANAGEMENT AND BUSINESS RESULTS
KEY INITIATIVES
• AWARENESS SESSIONS AND TRAINING OF ASSESSORS

• BE-BP AGREEMENT
• INSTITUTIONALISING KRA PROCESS
• REINFORCING WCM PROGRAMMES - NOW ONTO TPM
• FOCUSSED / SEGMENTWISE CUSTOMER SATISFACTION
EVALUATION
KEY INITIATIVES - CONTD
• REINFORCEMENT OF SERVICE STANDARDS &

POST SERVICE FOLLOW UP
• MOU & SLA FOR SUPPORT DEPARTMENTS
• PRODUCT COST BENCHMARKING
• TOTAL EMPLOYEE INVOLVEMENT - SGA & CFT
• TRAINING EFFECTIVENESS EVALUATION - OPAP
• IMPLEMENTATION OF PERFORMANCE PAY
• 360 DEG APPRAISAL FOR SENIOR EXECUTIVES
• INTEGRATION AND ALIGNMENT THROUGH
PERFORMANCE MEASUREMENT MATRIX
TBEM SCORES
700
600 +
600 525 +
486
500 452
405
400
300
200
100
0
1997 1999 2000 2001 * 2002 *
* TARGETS
DURING 2000 EVALUATION TITAN CROSSED 50 % SCORES IN 10 OUT OF

19 ITEMS AND WAS HIGHEST IN TATA GROUP IN ITEM 6.1 (PRODUCT
AND SERVICE PROCESSES) WITH 70%
TITAN TIME PRODUCTS
LIMITED
TITAN TIME PRODUCTS LIMITED
BUSINESS PLAN HIGHLIGHTS: 5.6 MILLION PRODUCTION
IMPROVEMENTS
Year 96-97 97-98 98-99 99-00 00-01 01-02

Production (Qty. lakhs) 40.0 42.4 45.3 49.0 52.0 56.0
Material cost / ECB (Rs.) 17.0 14.5 13.7 12.0 10.3 9.90
Transfer price / ECB (Rs.) 26.4 24.4 22.2 20.1 18.6 18.1
Throughput time (Hours) 298 229 135 83 58 40
Rs. Lakhs
00-01 01-02
Income 965 1050
Profit 34 40
Dividend paid - 12 %

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WATCH MANUFACTURING

KEY FOCUS AREAS

DEVELOP FLEXIBILITY TO MEET FLUCTUATION IN DEMAND

REDUCE RESPONSE TIME TO MARKET

AGGRESSIVELY DRIVE DOWN COSTS

LEVERAGE CORE COMPETENCIES TO EXPLOIT NEW BUSINESS

UPGRADE EMPLOYEE SKILLS, INCREASE MOTIVATION AND

INHOUSE QTY - K GROWTH %

WATCH PRODUCTION 6710 6.2

BOUGHT OUT QTY - K GROWTH %

MOVEMENTS 685 -51

STRAPS 1785 -18

TOTAL (LIVE) MONTH AVERAGE

WATCH VARIANTS 1900 900

CATEGORY RESPONSE % OF PRODUCTION

 LEAD TIME REDUCTION

TARGET ACTUAL ACTUAL

QUALITY IMPROVEMENT INITIATIVES

 SELF CERTIFICATION OF VENDORS

 VENDOR EDUCATION & TRAINING

 MONITORING CP/CPK FOR CTQ CHARACTERISTICS

 IMPROVING NEW PRODUCT RELIABILITY

SHEET METAL STRAPS 98.5 98.0

REDUCE MARKET RETURNS - WITHIN GUARANTEE PERIOD

 CATEGORY-WISE TRACKING AND ANALYSIS OF FIELD

 ANALYSING AND MONITORING COST OF GUARANTEE

 NEW PRODUCT RELIABILITY IMPROVEMENT THRO

PREVENTION 3.11 0.63 1.09

* TARGET 01-02 - TO REDUCE BY 5%

SEIKO, JAPAN - BATTERY UNIT - TOTAL COQ- 1.5%

 BULK PRODUCTION OF HYBRID 6000

 INSTALLATION OF LINEAR TRANSFER MACHINE FOR MAIN

 USE OF INDIGENOUS SS RAW MATERIAL FOR CASES

 CRYOGENIC TREATMENT OF TOOLS

 SEPARATE LINES FOR MACHINING & SUB-ASSEMBLY AT EBAUCHE

 PRODUCTIVITY IMPROVEMENT IN ION PLATING

 ESTABLISHING MFG PROCESS FOR 14 kt YELLOW, WHITE & ROSE GOLD

 ESTABLISHING MFG OF LIGHT WEIGHT GOLD BRACELETS THROUGH FURNACE

 IMPROVING OEE OF CRITICAL MACHINES

 IMPROVING MTBF & MTTR OF TPM M/CS

CURRENT TARGET 01-02

MTBF : MOVT PLANT 296 HRS 1500 HRS

MTTR : MOVT PLANT 3 HRS 1.5 HRS

OVERHEAD REDUCTION INITIATIVES

 SENIOR LEVEL CROSS FUNCTIONAL TEAM

 MANPOWER REDEPLOYMENT - NO RECRUITMENT

 CONSERVATION OF POWER, FUEL, WATER-EMS

 REDUCTION IN COMMUNICATION & TRAVEL COSTS

UNIT OVERHEAD REDUCTION

OVERHEAD BUDGET (RS CR) 106 105

PRODUCTION (K) 6710 6320

OVERHEAD/WATCH (RS) 158 166

PERCAPITA OUTPUT (NOS/YR) 2750 2550

NOTIONAL SAVINGS RS 540.0 LAKHS

01-02 00-01 CHANGE

GROSS CONTRIBUTION Rs 206 Rs 183 +12.6%

 SAVINGS BUDGET (Rs LAKHS)

180 MATL OH FOB CUSTDUTY

200 125 127

 SKELETON WATCH - TITANIUM

 JOINT DEVELOPMENT WITH IISC

• PLANAR MAGNET TO ELIMINATE COIL WINDING

 FOCUS ON PRODUCTIVITY IMPROVEMENT AND CAPACITY