Operations

Management At
HVAL

Arijit Mitra
Inderjit Singh
Mridul
Sharma
Rahul Rai
 HVAL
• Formed in March 2000
• Manufacturing Axles & Axle parts for Medium & Heavy
Commercial vehicles
• B2B Entity
• Capacity of over 3.6 lakh axles per annum.

Meritor,
Tongil,
Steyr

HVAL in M & HCV Indian HVAL in M & HCV Tata Motors

Industry Ltd
 PRODUCTS OF HVAL

REAR AXLE
LIVE FRONT AXLE

NORMAL FRONT AXLE

Organizational Chart A.B. Lall (CEO HVAL and
HVTL)

A. P.K.
Jamaiyar G. Ahuja
(CFO) Choudhury S.Aich (AGM Plannin
(COO) (DGM Engg.)

CQ& CM Matl. & ADD HR and BES PPC RABU FABU DHBU

3 BUSINESS
UNITS
 IDEAL PROCESS FLOW DIAGRAM
PROCESS PLANNING
LONG RANGE

STRATEGIC CAPACITY PLANNING

SUPPLY NETWORK PLANNING

FORECASTING AND DEMAND

MANAGEMENT OPERATIONS / AGG . PLANNING
MEDIUM RANGE

MANUFACTURING LOGISTICS SERVICE

S

MATL .
REQUIREMENTS CAPACITY DAILY
PLANNING PLANNING WORKFORCE
SCHEDULING

ORDER
SCHEDULING DISPATCHING
SHORT
RANGE

W / H RECEIPT
PLANNING
ENTERPRISE PROCESS MODEL
 l
ve
Le
Vision

c
Mission

gi
Core Values

te
ra
Strategic

St
Direction
Leader System

LEVEL 1
l

EPM 9 Top level processes

ve
Le
ss
ne
si
Bu

EPM 40 + sub processes LEVEL 2

l
ve

LEVEL
Le

3
on
ti
ta
en
em

Infrastructure creation
Vendorand
mgmt
maintenance
, material and logistics
pl
Im

Production, QA and maintenance

HR, Legal and AdminCustomer support
NPI
Finance

HVAL PROCESS MANAGEMENT

PYRAMID
 Expectations, Statutory
Requirements
2 VALUE CREATION SYSTEM
DEMAND CREATION

CUSTOMER AND OTHER STAKEHOLDER

3
Customer requirement determination
LEADERSHIP SYSTEM

Ability to manufacture low

DEMAND FULFILLMENT
PRODUCT PRODUCTION AND AFTER SALES AND
DEVELOPMENT

lifecycle cost Axle

DELIVERY PROCESS SUPPORT PROCESS
PROCESS

•Dev. & •Production

budgeting of •Warranty Mgmt.
Planning
LEADERSHIP PROCESS
STRATEGIC PLANNING

NPI prod. Plan

4 5 •Spare Parts Mgmt.
•Manufacturing
•Monitoring &
Execution of •Customer Complaint
NPI Project •Maintenance mgmt.

•Prod. Design •Vendor Management 6

and Dev.

SUPPORT SYSTEM
1 Human Resource Mgmt 7 Finance8 and budgeting 9
Facility and Environment Mgmt
 Process No. 5: Production & Delivery
Process
SUB PROCESS NO SUB PROCESS NAME OWNER DEPT.
5-01 Production, Planning & Scheduling PPC

5-02 Produce aggregates and components Central Quality and Maintenance

5-03 Maintenance of machines and equipment Central Quality and Maintenance

5-04 Selection and development of Vendors Materials & ADD

5-05 Part Development Process Materials & ADD

5-06 Procurement process Materials & ADD

5-07 Vendor Performance Monitoring & Improvement Process Materials & ADD

5-08 Vendor Rationalization Process Materials & ADD

5-09 Performance Improvement Materials & ADD

5-10 Process Design & Improvement Engineering

5-11 Manage Safety COO

 IDEAL PROCESS FLOW DIAGRAM WITH EPM
PROCESS PLANNING 5 - 10
LONG RANGE

5 - 04 to 5 - 09
STRATEGIC CAPACITY PLANNING 5 - 01
SUPPLY NETWORK PLANNING

FORECASTING AND DEMAND

MANAGEMENT OPERATIONS / AGG . PLANNING 5 - 01
5 - 01
MEDIUM RANGE

MANUFACTURING 5 - 01 LOGISTICS SERVICE

S

MATL .
REQUIREMENTS CAPACITY DAILY
PLANNING PLANNING WORKFORCE
SCHEDULING

ORDER Taken care of by HR & BE

SCHEDULING DISPATCHING
SHORT
RANGE

W / H RECEIPT
PLANNING
Department NEW PRODUCT
DISPATCH REGULAR
Interactions PRODUCT

ENGINEERING PRODUCTION
HUMAN RESOURCE NEW PRODUCT PLANNING &
(PSD) RESEARCH INTRODUCTION
CENTRE CONTROL

MANPOWER MASTER
PRODUCTION
AUTO SCHEDULE
INBOUND DEVELOPMENT MRP
LOGISTIC DEPARTMENT

MATERIALS

SPIG

FABU RABU DHBU

PRODUCTION PLANNING
CONTROL
 PPC Structure
AGM(R.P Singh)

MI M2 M3

SUPERVISIORS
TM2-TM3(Manager Grade)

E Grades Temporary Grade

 3 - day plan process ( For only
Jamshedpur Plant )

AllPPC
day planConfirmation
from TML aggregate
from PPCMaterial
, Jamshedpur
ADD & meeting dept
at TML
andtoProduction
freeze schedule
Dept (9for next
to 10 a.mday
.) (This is ca

Dispatch for all customer Production

Production
meeting at HVAL (3:30 p.m) to freeze the production
 Monthly Process ( Common to all
customers )

from TML (Vehicle Orders

level) Received
on 26-27thatof
Order
the Vehicle
transferred
previous Level(18
month at-19
axle
Models
level) (Two sub part DOMESTIC

Getting
ent (finalinformation from Material
) to every department ( HR, for
Circulation
deciding
Quality the
of priority
the etc
,Production requirement
) (Confirmation
to ADDof
, Material
4-5 Days)and COO
Demand Forecasting
Method of forecasting: Done by Tata Motors. Mainly experience from the past sales and data
•

given by Sales and Marketing

Error in forecasting: Cost is born by Tata Motors, so they take care of. Demand is Dependent
•

in nature.

Demand sources
•

• Tata motors (Jamshedpur, Lucknow and Pune)

• Spare parts,
• Vehicle factory Jabalpur (Defense),
• Telcon
• Dutch Lanka Trailer.

Key Points
•

• Bullwhip effect is not considerable as less number of parties are involved in the supply chain
• Demand of vehicle is cyclical. It increases in Jan to March and decreases from April to June
• Cyclical component: model based. Overall it is cyclic
• HVAL is answerable to Board if they are not able to meet the demand.
• Inventory Audit is done on daily basis.
• Lucknow-Bucket Plan (May be for a week)
• Spare parts (Monthly Plan)
• Seasonality factors: Yes, some bonus in some season
• Random variation: Taken care at the time of release
• Planning strategy: Determined by
PSD, Dominantly chase
• Backordering cost: Indirect cost is
there. HVAL is answerable to board.
• Inventory control: PPC is
responsible for the FG inventory.
• Inventory calculation: Manual
audit and SAP.
D A ILY P LA N
MONTHLY PLAN
AUTO DEVELOPMENT
DEPARTMENT
 List given by NPI (BOM) Categorization from Requirement sent to 3-4
along with design BOM given by NPI (A,B,C suppliers with documents
documents and quotation asked

NO Quotation, if obtained
Negotiation of sent to Price panel for
Rejecte OK? supplier with price estimation of cost acc. To
d panel Zero Based Costing

YES

Again sample has to

be given by supplier
PO released

NO

Sample with FMEA, QA checking of sample

Process flow diagram with all documents OK?
etc. from suppliers

YES
Ownership YES
transferred to Inspection PPAP lot
materials dept. OK?
by SQIG demanded
for regular
supply
• Supplier Selection basis:
• Quality (both for new and regular part)(% of Rejection)
• Cost (both for new and regular part)
• Capability (both for new and regular part)
• Delivery time (for regular part)
• Requirement of documents from suppliers
• Inspection Check
• PFP
• Control Plan
• Failure Mode Effect
• Metallurgical grain flow report
•  
• Commitment Inventory Category
•  
• A- Inventory up to 10 days
• B- Not expensive, inventory up to month
• C- Low value items, up to 3 months
•  
• Key Points
MATERIALS DEPARTMENT
ERC
NEW
NPI Demand ADD
schedule

PPC REGULAR

Aggregate

Yearly,
Par Source monthly &
t Daily schedule
for supply
INSPECTION
YES BY SPIG
Supply to ( QA ) Follow up with
Productio OK? Supply to
store suppliers
n line

NO
 Inventory control
•11 days inventory is being kept by Material dept. Value based Inventory
system.
• Basis of the 11 days:

•Geographic location

• Cost of part
• Lead time
• Shelf life of the material
• Order quantity/volume
•

Key Points
•

• Generally 6 vendors are kept for each component

• 5-10% extra order
• For local vendor, JIT concept is applicable.
• MRP Structure: SAP is used
• Placing order: Price panel and Materials dept. jointly take decision
•
PRODUCTIVITY SERVICE
DEPARTMENT
 PROJECT

NEW PROJECT REGULAR

PROJECT

PLANNING
PROJECTED VOL OF PRODUCTION
(WITH VARIATION )

MANPOWER
REQUIREMENT
MANPOWER CALCULATED AS PER
STANDARD (FOR THE VARIATION
ALSO)
ASSESSMENT BY NO
PSD OK Demand from
production
YES

ARRANGEMENT OF MANPOWER ARRANGEMENT OF MANPOWER

• Recruitment: From employment exchanges
and local diploma colleges (Students from ITI,
ITDR)
• Operators pay decision:
• Productivity Index of the company
• Quality Index of the company
• Safety Index of the company
• EBIT of the company
• Calculation:
• Payment = Fixed payment + Variable payment
• Variable payment = f (Productivity Index of the
company, Quality Index of the company,
Safety Index of the company and EBIT of the
company).
SCORECARD ASSESSMENT

DIVISIONAL HEAD
FEEDBACK

PSD, HR AND DIVISION HEAD

REVIEW

FINAL GRADING
• Key Activities:
• Audit for document adherence (Mainly for NPI, ERC and
Quality Department) as per the guidelines of Tata
Business Excellence model
• Supplier quality Assurance (at the supplier end)
• Quality inspection before sending to assembly line
• Pre-dispatch inspection of the finished product
• Statistical process control:
•DFMEA and PFMEA

• Flow chart
• Run Chart
• Pareto chart
• Fish Bone diagram
• Check-sheet
• Opportunity Flow diagram
• Process control chart
• Quality at supplier end:
• Zig and fixture quality (critical dimensions checking)
• Process capability of supplier
Quality Assurance
department
 An example of Quality Control
Process
• Failure
• Fish Bone diagram
• DFMEA/PFMEA
• Root cause found (if it is critical
dimension related)
• Process control chart used to
standardize the design/process
•
New Product Introduction
• Different types of project Handled by
Changes NPI

Mix and Match Green Field

High

Product
Existing/Regul Improvement
ar
Low

Low
Cost
High
 Maintenance

•Adopted Nakajima ’ s TPM model

•
•Implementation at the Plant
Level
•
•Quarter Kaizen program
•
•TPM Manual
•
•OEE measurement
Operational Strategy
 Technology Management
• Outsourced to Tata Technologies Limited.
•Critical Technologies are as follows

ü Digital manufacturing technology (Delmia)

ü Pro-E for computer aided Design
ü Product lifecycle management software
ü System Application Product (SAP)
ü Software for Design and Analysis (Gear Engineer Pro, MS
Nastran, LS Diana etc.)