Industrial Engineering Techniques and Applications

8/13/2019 Industrial Engineering Techniques and Applications

http://slidepdf.com/reader/full/industrial-engineering-techniques-and-applications 1/6

International Conference on Mechanical, Industrial and Energy Engineering 201023-24 December, 2010, Khulna, BANGLADESH

MIE10-005

Industrial Engineering Techniques and Applications

*Kazi Arif-Uz-Zaman1 , Md. Rezaul Hasan Shumon2 , Md. Habib Hasan3

1, 2, 3 Department of Industrial Engineering and Management, Khulna University of Engineering & Technology, Khulna-9203,

BANGLADESH

ABSTRACTThe specific contents of the research mainly focused on explaining and analyzing industrial engineering techniques and itslimitations, scope in Bangladesh Industries. It had been discussed in this paper that why the industrial engineeringtechniques would needed badly specially in various sectors (such as in garments, textile, jute mils, cement industries etc.).The main outcome of the research is to make industrial engineering techniques acquainted with related Industries and also to

find out the applications available for Bangladesh perspective. At the end of this paper it would be clear that how theindustrial sector could be benefited by adopting these techniques.

Keywords: Scheduling, Forecasting, Material Requirement Planning (MRP), Supply Chain Management, Method Study.

1. Introduction

Industry is the backbone upon which the economy ofany country prevails. The growth of economy, theinternal development of a nation depends upon thedevelopment of industrial sector. In a growingeconomy like ours, the finite nature of material and

other resources requires a reappraisal of contemporarymethods of management and manufacture with stress

laid on revising and implementing optimal systems.There are many management sciences which steer to productivity improvement programs in differentspheres of economic activities. In Bangladesh and all

over the world, industrial engineering, perhaps, is pioneering management science which found its

application in industry for resources utilization,effective management and optimum timeconsiderations. ILO, in the earlier years, demonstratedthe efficacy of Industrial Engineering techniques as ameans of raising productivity and improving thequality of work life.

2. Significance of the research It is seen from various statistics that in industrial sector

Bangladesh has a huge capabilities and possibilities todevelop. Although Bangladesh has sufficient amount ofnatural resources, cheap labor and machine ability yetit is not enlisted as an industrially developed country.From various statistics it has been shown that howindustrial engineering techniques could work there as a

catalyst or booster. This research had the cardinalobjective to visualize the industrial engineering

techniques to industrial and related personnel in theindustries. The common belief was that thesetechniques could be used as a common sense approachtowards production problems, this is true to a certain

extent but the development in tools and the approachesto face critical issues were equally important. So in this

paper it had been tried to provide the information and procedures applicable in technical and non-technical

situations. By applying various techniques it had beenrealized that how the use of industrial engineering

techniques could increase smart profit line with least

cost and effective and efficient manner.

3. Methodology Initially different types of industrial engineeringtechniques had been studied from where a few essential

techniques were discussed which could be veryeffective in Bangladesh perspective. The possible

scopes for applying those techniques and a practicalimplementation of how to use them in particularsituation had also been detected. Information of thisreport was collected from both primary & secondarysources. The primary sources of this paper weredifferent company personnel’s where the secondary

sources were foreign journal, books &internet. Someindustries like Meghna Cement Ltd, BRB Cables Ltdand Akij Jute Mills Ltd etc. had also been visited foressential data collection. Moreover it had beenanalyzed where the techniques could be useful, alreadyusing, merits and demerits with suitable reasons and

causes.

4. Industrial Engineering techniques and analysis

There is huge number of techniques and tools have been practiced throughout the world regarding

industrial engineering. Manufacturing and productiongiants as well as service and non- profitableorganizations are utilizing these techniques now a day.This paper had outlined some of these techniques and

their applications mainly in manufacturing industriesfor Bangladesh perspective.

4.1 ForecastingForecasting is the process of estimating future demandin terms of the quantity, timing, quality, and locationfor the desired products and service. Actually it is aninference of what is likely to happen in future or futuredemand which is based on past data. Good forecast

should be accurate, reliable, timely, easy to understand

and cost effective and can be range from the simple to

* Corresponding author. Tel.: +88-01711385906E-mail address: [email protected]




the extremely complex. It is a valuable input to planning decisions.4.1.1 Scopes and benefitForecasting can be used in almost all the productionsectors of Bangladesh. Basically now a day’s garmentsand textile sectors are providing a vital role to national

economy. Some renowned industries are usingforecasting techniques predicting future productions.Meghna Cement Ltd & BRB Cables Ltd, Wal-Mart,

Unilever and so many other manufacturing and serviceorganizations use forecasting on their strategy andutilizing their production processes effectively.To resolve expected better customer service with fewerresources, the importance of effective forecasting iselevated. Following with this example of HamkoBattery while Company provides sales data as bellowin Table 1 for 6 months in the year of 2009:

Table 1 Sales and Demand data for the year 2009

(March- July)

Month Demand(pcs)

Production(pcs)

1 3000 2800

2 3520 3250

3 4000 4500

4 3950 4600

5 4120 3500

6 5800 4550

Comany fulfilled their demand as customer needs from

first to fifth month but in sixth month they didn’t

produce finished product according to customerdemand, because of uncertainty of demand.“Linear Trend Equation”:

• Ft = Forecast for period t

• t = Specified number of time periods

• a = Value of Ft at t = 0

• b = Slope of the line

Table 2 Forecasting calculation

So in the 6th month factory had to produce F6=

+ = 5690.5 in quantity. In case of

forecasting technique they could produce 5691 in placeof actual production of 4550.

Ft = +

4.2 Inventory managementInventory is a quantity or store of goods that is held forsome purpose or use. Inventory may be kept "in-

house," meaning on the premises or nearby forimmediate use or may be held in a distant warehouse or

distribution center for future use.

4.2.1 Scopes and benefitActually inventory is very critical issue for anyindustries which fundamentally being used in industriesfor raw material, work in progress product and finished

product. But most of the cases these places are not being maintained systematically according to inventory

management. Managing inventory effectively couldsave huge amount of money, time and space.Production is generally based on raw material. Themain expenditure of a manufacturing company relieson raw materials. So the availability of raw material isa vital issue for a company. A company’s order

quantity, number of order per year, length of order

cycle, total annual cost for raw material etc. directlydepends on inventory and stock amount. Following anexample, Akij jute mills Ltd. where annual target of 14lakh tons jute for production. Annual carrying cost perlakh ton is 45 lakh taka and ordering cost is 80 lakh

taka each. So their economic order quantity (EOQ)should be:

Ft

= a + b*t

Q= = lakh ton

Number of order per year:

Total annual cost TC = carrying cost + Ordering cost

= = 317.5 lakh taka

But Akij jute mills Ltd purchase raw materials placingorders in 4 times with total cost of 78.75 +

4*80=398.75 lakh taka which is obviously more thanestimated value. Using inventory management could

save 81.25 lakh taka.

T yMonth

(t)

t2

Sales

(pcs)

t*y

1 1 3000 3000

2 4 3520 7040

3 9 4000 12000

4 16 3950 15800

5 25 4120 20600

6

∑ t = 15 ∑t2 = 55 ∑y = 18590 ∑( t*y ) =58440

(∑t)2 = 225

H= Holding costS= Ordering cost

Q= Ordering quantity

MIE10-002-4




4.3 SchedulingScheduling is the process of deciding how to allocateresources between varieties of possible tasks.Scheduling pertains to establishing both the timing anduse of resources within an organization. Under

operations function (both manufacturing and services),scheduling relates to use of equipment and facilities,human activities, and receipt of materials. Time can be

specified or floating as part of a sequence of events.Scheduling works with the priority rule that can be

viewed with grant chart. Scheduling establish thetiming of the use of equipment facilities and humanactivities in an organization. Scheduling involves thefine tuning of aggregate production plants.

4.3.1 Scopes and benefit

In the decision making hierarchy, scheduling can stairup the transformation process of resources before

actual output occurs. Effective scheduling can yieldcost saving and increases productivity. But it is truethat in Bangladesh very few are using this techniquewhile most of them set human scheduler's judgmentand experience. But only systematic scheduling can

earn more profit and save time and resources from theexisting plant. Companies have to use scheduling to

allocate plant and machinery resources, humanresources, production processes and purchase materials.Production scheduling aims to maximize the efficiencyof the operation and reduce costs.For example, four people had to assign in four differenttasks of gear, nut, bolt and bearing making to complete

a whole process where each one had the skill of doingeach job but with different capacity shown in Table 3.

Task could be optimum assignment of jobs for workersto complete the whole process.

Table 3 Job assignment

Using “TORA” (software to solve linear solution) thefinal result relating to manpower allocation accordingto tasks is,

The total time came 20 minutes for optimum allocation

of tasks in between the four workers. If they would use

this technique they could save extra time as well as costmore effectively.

4.4 Supply Chain ManagementThe supply chain is a network of organizations that

involved, through upstream and downstream linkages,for different processes and activities that produce valuein the form of products and services in the hands of the

ultimate consumer. Supply chain management meansmanaging the supply of inbound and outbound goods

or service in the most cost effective & time sensitiveway. Actually it is a system of organizations, people,technology, activities, information and resourcesinvolved in moving a product or service from suppliesto customer.

4.4.1 Scopes and benefitSupply chain management is an important and effective

industrial engineering technique. It is necessary toapply in every industry for smooth production andmaximum profit. The goal of a supply chain is tomaximize overall supply chain profitability. Supplychain decisions have a large impact on the success or

failure of each firm because they significantlyinfluence both revenue generated as well as the cost

incurred. It flows of product, information and funds to provide a high level of product availability to thecustomer while keeping cost low. Supply chainmanagement is necessary for good quality, minimumcost, production flexibility, feasible production velocityand good customer service. It includes not only the

manufacturers and suppliers, but also transporters,warehouses, retailers and customers themselves.

Sometimes industries like BRB Cables Ltd, MeghnaCement Ltd, Akij Jute Mills Ltd etc. are facing lateshipment due to improper supply chain strategy wheresome renowned company like Unilever, Nestle, ACIlimited, Square Ltd are generating enormous revenuedue to proper and effective supply chain management.

4.5 Material Requirement Planning (MRP)Demand for components needed to produce a finished product is dependent. An alternative approach formanaging inventories for dependent demand items areknown as material requirement planning (MRP). MRPis a method which starting with a forecast for the

independent demand for a finished product, determinesthe dependent demand for (1) the kinds of components

(materials, parts etc.) needed, (2) the exact quantitiesrequired and, (3) the time phasing of the above ordersto satisfy a production plan. MRP processing takes theend item requirements for assemblies, parts and rawmaterials. The input and output structure of MRP isgiven in fig.1. The application of MRP in Bangladesh

industries is very little. Some large & profitableindustries are using MRP while most of the industries

have no idea about MRP. Implementation of MRP inindustries or an organization has some advantages.

Man

A B C D

Gear / Minutes 8 6 2 4

Nut/ Minutes 6 7 11 10

bolt/ Minutes 3 5 7 6 O B

Bearing/ Minutes

5 10 12 9

job Gear Nut Bolt Bearing

man C B D A

Time/minutes 2 7 6 5

MIE10-002-4




• Low levels of working-on-processinventories.

• Ability to track material requirements

• Ability to evaluate capacity requirements

• Means of allocating production time

If MRP is used in production system, it is possible tohandle the required components as needed asrequirements with proper planning and responsibility.

MRP inputs MRP outputsMRP processing

Master

schedule

Fig.1 MRP overview.

4.6 Transportation modelThis is a special case of the simplex method developedfor the general linear-programming problem ofallocating scare resources to competing demand. In thedirect sense, the transportation model seeks thedetermination of a transportation plan of a single

commodity from a number of sources to a number ofdestinations. The data of the model include:

• Level of supply at each source and amountdemand at each destination.

• The unit transportation cost of the commodity

from each source to each destination.

4.6.1 Scopes and benefitThe objective of the model is to determine the amountto be shipped from each source to each destination

such that the total transportation cost is least. Thetransportation model involves finding the lowest cost plan for distributing stocks of goods or supplies frommultiple origins to multiple destinations based on thedemand of the goods. Purpose of this technique is,

• To compare location alternatives in terms oftheir impact on the total distribution costs forthe system

• To minimize the costs associated withdistributing goods

• To determine the lowest shipping cost

Certain important problems related to the distribution

of goods from existing facilities, the location of a new plant or warehouse, and aggregate production planning

can be formulated for solution by linear- programmingtransportation model. Typical advantages of thetransportation model are:

• The determination of a minimum-cost(maximum- profit) shipping to satisfy

requirements at several destinations from a

number of sources with available supply. Thisis known as distribution problem

• The selection of a location for a new facility (a plant or warehouse) in a way that minimumcost. This is called location problem.

• The assignment of different forms of productive capacity in successive periods tomeet forecast demand in such periods so as to

minimize total production cost. This is knownas the aggregate- planning

4.7 Method studyMethod study is the systematic recording and critical

examination of existing and proposed ways of doingwork, as a means of developing and applying easierand more effective methods and reducing costs. The

main objective of method study is to improve processesand procedures, design of plant and equipment, layout,

use of men, materials and machines, human effort andreduction of unnecessary fatigue, safety standards and better working environment.

4.7.1 Scopes and benefitIn Bangladesh, there are a lot of opportunities toimplement method study. As our resource is limited, so

domestic industries are thinking about to optimize a

process or system within this limited resources.Generally, industries like textile or garments where alot of human involvement is found, method study can be a guideline. Several industries that have been usingthis Industrial Engineering technique are getting its

betterment. From Table 4 and Table 5, we can see thatafter improving the method with combining theoperations using method study, the operation’s distancehas been reduced 110 ft and also 17 steps have beenremoved, which will save money, time and ultimatelyincrease production rate.Beside these it has certain benefits:

• Improves methods or procedures.

• Improves lay out.• Utilize the resource.

Bill ofmaterial

Inventory

MRP

Planned order schedules

Performance control

reports

Inventory

Primary reports

Secondary

Reports

MIE10-002-4




• Reduce human effort.

• Develop suitable working conditions.

Table 4 Existing methods for production (BeforeMethod study)

Drill & Tap (230 ft traveled)

Table 5 Modified methods for production (After

Method study)

Drill & Tap (120 ft traveled)

4.8 Time StudyIn time study a timing device is used to time the jobwhile it is being performed (sometimes the job can be

simulated prior to actual operation) where standardscan be developed for the same job. Time study

equipment is relatively simple and inexpensive –allthat need is a timing device and an observation sheet.Timing devices include a stop watch, motion picture orvideo camera, electronic timer, machine downtime

recorder, tachometer and computer .Generally jobs aredivided into least segments & set time standards for

each segment. Then following standard time, efficiency

for each employee is calculated. Normally a lot of timeis wasted for maximum time consumption in bottleneck processes. By applying time study and

optimization of processes we can remove the bottleneck processes and extra time.

4.8.1 Scopes and benefitFig.2 illustrates an example of a 7- step production

process where each process is consuming differenttimes. Pointing on process 7 which waits 12 minutesafter completion of task while the preceding one waits

8 minutes. Here by applying time study and line balancing technique, idle time can be reduced andultimately production rate can be increased.

Fig.2 7- Step production process with idle times (inminutes)

5. Field of Applications and Limitations

• Aerospace & Airplanes

• Aluminum & Steel

• Banking

• Ceramics

• Construction• Consulting

• Electronics Assembly

• Energy

• Entertainment

• Forestry & Logging

• Materials Testing

• Medical Services

• Military

• Mining

• Oil & Gas

• Plastics & Forming

• Shipbuilding• State & Federal

• Government

• Transportation

In the whole work it has been focused that how theBangladeshi industries can be benefited by using or

applying industrial engineering techniques. Generally,more or less, all the industry personnel’s know aboutindustrial engineering techniques. But they lack theknowledge of applying the techniques in a productionsystem. Besides the frame of the paper volume andeffective study times worked as obstacles during this

investigation. After all, it was a challenge to structure

the whole work within these limited volumes. Some problems arise during data collection. Most of the

MIE10-002-4




industries were not willing to provide internal data.Anyway, while applying industrial engineeringtechniques in Bangladeshi industries at full force, somelimitations raised. So by discussing all theopportunities and scopes, it is very lucid that this is the

high time for implementing industrial engineeringtechniques in Bangladeshi industries for the survival inthe competitive markets with effective production

capacity and efficiency and with optimum profit andrevenue.

6. Conclusion Today, industries are the most important part in variouscountries. Many developed countries (U.K, U.S,Canada) and developing/semi developed countries(China, India) depend significantly on industrial

development. It is found that these countries are usingIndustrial Engineering techniques. For a developing

country like Bangladesh, it is really important to boostup the industrializations. To be recognized as anindustrially developed country, there is no alternativeway without using Industrial Engineering techniques. It

is sad but true that these concepts are still new inBangladesh. If it could be possible to apply these toolsand techniques in Bangladesh by any means, then thatday would not be so far to become an industriallyleading country in the business world.

REFERENCES

[1] Hillir, Lieberman, Introduction to operationsresearch, 3rd edition.

[2] Stevenson J. William, Operations management,8th edition, ISBN 0-07-286905-4.

[3] HamdyA.Taha, Introduction to operations

research, 5th edition, ISBN 9974-51-351-X.[4] Sunil Chopra, Peter Meindl, Supply Chain

management, Strategy, planning and opportunity,2nd edition.

MIE10-002-4

Industrial Engineering Techniques and Applications

Documents