Operations Management at Tinplate Company of India
TCIL is the largest indigenous producer of tin coated and tin free steel sheets in India
Having 35-40% market share The industry leader for more than 90 years Headquartered in Kolkata, the Company’s Works is located at
Jamshedpur, Jharkhand Presently 11 offices in India and a distribution network with
16 stocking points TCIL Works presently has two Electrolytic Tinning Lines
(ETLs) and Cold Rolling Mills (CRMs) The Company is in the business of manufacturing and
supplying reliable, cost-effective, value-added tin mill products
It manufactures various grades of electrolytic tinplates, tin-free steel sheets and Full Hard Cold Rolled Sheets (FHCR) used for metal packaging
An Introduction
Operation Strategy Decision
Identify a key Operations Strategy decision made during the above study period
It is a Japanese initiative coordinated and
supported worldwide by Japan Institute of Plant
Maintenance, was launched at TCIL in the year
2001-02
What is TPM?
Medical science of machines
System of maintaining and improving the
integrity of production and quality systems
through the machines, equipment’s, processes
and employees that add business value to the
organization
Goal of the TPM
To markedly increase production while, at the same time, increasing employee morale and job satisfaction
The Decision
TPM (Total Productive Maintenance)
To introduce robust operational processes, improve quality and gain operational excellence as part of the company’s short term plans
Measure the effectiveness of the 8pillars of TPM through P(Productivity), Q(Quality), C(Cost), D(Delivery), S(Safety), M(Morale)
Objectives of TPM
Achieve Zero Defects, Zero Breakdown and Zero accidents in all functional areas of the organization
Involve people at all levels of organization
Form different teams to reduce defects and drive Self Maintenance
The ‘Why’ of Decision
TCIL Speak – TPM Policy
We are committed to adopt TPM through the participation of all our employees. Our aim is to achieve zero failure, zero defects and zero
accidents. We shall achieve this by creating a clean and pleasant work place through teamwork and
committed employees.
Direct benefits of TPM Increase productivity and OEE (Overall
equipment efficiency) by 1.5 or 2 times Rectify customer complaints Reduce the manufacturing cost by 30% Satisfy the customer’s needs by 100 %
(Delivering the right quantity at the right time, in the required quality)
Reduce wastage in fast changing environments
Reduce accidents Follow pollution control measures
Indirect benefits of TPM Higher confidence level among the workers Keep the work place clean, neat and
attractive Favourable change in the attitude of the
operators Achieve goals by working as Team Share knowledge and experience The worker gets a feeling of owning the
machine
TPM @ TCIL
Process StructureIdentify the process structure for any two stages of manufacture of a product of the chosen business
Electrolytic Tinplating Process
Cold Rolled
Steel CoilUncoiling Alkaline
Cleaning Rinsing
Pickling RinsingElectro-plating with tin
Drying
Brightening by
Reflow unit
Passivation Oiling Shearing
Classifier Packing Despatch
Soak Clean
Electro-
clean
Rinse
Acid
Rinse
Plate
Rinse
Bright Dip
Rinse
Chromate
Hot Rins
eDry
Tin Electroplating
Capacity Planning Strategy
Is the sales growth for the above product based on an “Expansionist” or “Wait-and-see” capacity planning
strategy? Why?
The sales growth for the above product is based on Expansionist Strategy as Tata Tinplate has always focussed on expanding their capacity. For 50 years, TCIL single-handedly built up the Indian Tinplate Industry
TCIL has undergone on-going expansion projects to double its capacity to 380,000MT between 2006 and 2010. These projects were taken up in phases, with the tinning line (downstream phase) being commissioned in September 2008 and the cold-rolling mills complex (upstream phase) during 2008-10
The State-of-the-Art new combination line with Electrolytic Tinning & Tin Free Steel
production facility is one of the main reasons that enabled TCIL to achieve this target for capacity expansion in the short time frame
TCIL has a wide range of product offerings both in coil & sheet form for the discerning
customers, primarily in the growing domestic and international markets and facilitate in consolidating its undisputed status as the leader in the domestic market and emerge as a world class regional player
As previously discussed TPM is also one of the strategy used by TCIL to improve their capacity by increasing productivity by 1.5 to 2 times and decreasing their manufacturing cost by 30%
Capacity Planning Strategy
Open Top Sanitary Cans (OTSC)o TCIL introduced the concept for open top sanitary canso TCIL is the domestic source for all OTS productso Available in single and double reduced formso Used for packaging of processed food
Variantso D 5.6/2.8o D 8.4/2.8
Tin Free Steelo It’s an electrolytic chrome plated steelo Consists of thin layer of chromium
Products and Variants
Open Top Sanitary Cans
Base
Steel
Cylindrical Sides
Coiled Steel
Lid
Steel
Packaging
Box
Product Structure Tree for OTSC
Operations PlanningBriefly describe how Operations Planning could be adapted
to the above identified process structures
Mission - Service customer requirements of green packaging by offering
reliable, cost-effective & value added tin mill products
Vision - Be an industry leader in value creation, servicing
packaging needs and creating a greener future
Aggregate Demand Forecast (160,000 MT)
We will be achieving the demand of 160,000 MT keeping in mind the vision & mission of the company
Aggregate Planning
Master Scheduling
Material Requirement Planning
Inventory Management
Aggregate Planning
Planning Horizon • Long Range
Planning Strategies
• Reactive Alternative• Chase Demand - Shift in approach of TCIL from
“made to stock” to “made to order” inventory practice
Advantages
• It minimizes the inventory for finished goods by trying to keep pace with demand fluctuations
• Since TCIL has a very large capacity, it matches demand by varying either work force level or output rate
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PROJECTED INVENTORY
MASTER SCHEDULIN
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OUTPUTSINPUTS
Master Scheduling Process (MPS)
YEAR ELECTROLYTIC TINPLATE (tonnes)
COLD ROLLING MILL(tonnes)
2010-2011 2,23,090 2,01,823
2011-2012 2,41,182 2,64,403
2012-2013 2,93,128 3,23,426
2013-2014 3,09,812 3,35,833
The result of dis-aggregating an aggregate plan, showing quantity and timing of a specific end items for a scheduled horizon.
BEGINNING INVENTORY:
Materials required are steel cover and metal cap
FORECAST:
Master Scheduling Process (MPS)
Total tinplate consumption in India has increased from 300,000 tonnes to 460,000 tonnes in five years, but in terms of per capita consumption it is still abysmally low compared with global standards.
TCIL has greatly benefited from the food consumerism revolution. It has responded by making available a vast array of products in different shapes, sizes and quantities.
CUSTOMERS:
Tinplate’s product open top sanitary cans in the form of finished goods are serviced to Tayo rolls limited, The Tata pigments limited and Tata steel international (Singapore) Pt. Limited
Master Scheduling Process (MPS)
Operations &
Project
Marketing Sales
Strategy
Total Quality Managemen
t
Information
Technology
Interdependence
As you can see in the above structure, steel is used twice in the process Usage of steel is a dependent variable because it is used in the production of finished
goods
STEEL
STEEL
Material Requirement Planning
• Steel procurement from TATA STEEL
DAY 1
• Picking up of the material
9 AM
• Assembly line
10.00 AM
Planning Horizon
Gross Requirements: 1,60,000 tonnes(Expected Demand)
Scheduled Receipts: 1,00,000 tonnes(Open orders scheduled to arrive)
Project on hand: 1000 tonnes(Expected inventory at the beginning)
Net Requirements: 5000 tonnes(Actual amount needed in each period)
Planned-order receipts: 4000 tonnes(Quantity expected at the beginning)
Planned-order release: 6000 tonnes(Planned amount to order at each period)
MRP Processing
Inventory Management
Model To take advantage of economies of scale and smoothen production
requirements, TCIL uses the EPQ Model Economic production quantity (EPQ) is the quantity of a product that
should be manufactured in a single batch so as to minimize the total cost that includes setup costs for the machines and inventory holding costs
Production is done in batches or lots
Raw Materials Used Steel and Hot rolled coils procured from Tata Steel Acid for electroplating Packaging box Spares
Inventory Management
Lead Time The key raw material involved in steel and hot rolled coil which is
procured from Tata Steel The lead time usually is between 12-15 days Inventory (safety stock) must be planned in accordance with the lead
time To effectively decrease the lead time for raw materials, TCIL
commissioned its state-of-the-art 120,000 tonnes per annum Cold Rolling Mill having the benefit of synergy with Tata Steel
Inventory Counting System TCIL could emply the Perpetual Inventory System wherein removals
from inventory continuously, thus monitoring current levels of each item Universal Bar Code to be created and labeled on each product variant
to monitor products inventory level
References Tinplate Company of India’s website: http://www.tatatinplate.com/ Electroplating process http://en.wikipedia.org/wiki/Electroplating Slideshare TPM