1

A REPORT ON
HEADCOUNT OPTIMIZATION IN A PRODUCTION LINE
AT
NOKIA CORPORATION


Submitted by

KAVINKUMAR S.
Register Number: 3511210123



Under the guidance of
Prof. SEETHARAMAN

A PROJECT REPORT
In partial fulfillment of the requirement for the award of the degree of
MASTER OF BUSINESS ADMINISTRATION
By
SRM UNIVERSITY


SRM SCHOOL OF MANAGEMENT
KATTANKULATHUR
2013


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ACKNOWLEDGEMENT




I would like to express my deepest gratitude and thanks to Dr. Jayshree Suresh,
Dean of SRM School of Management, for her valuable support and encouragement in
doing my project. She has been a source of encouragement and guidance in my all
endeavors.

I express my profound thanks to Mr.R.Seetharaman project guide, for his
consistent guidance and invaluable suggestion in completing this project, without his
support, the completion of this project would be practically impossible.

I would also like to thank to Mr.Thanigaivel (Operations Dept. Lead, Nokia),
Mr.Deepak Loyola (Operation Dept, Nokia.) for their ever friendly support they
extended in completing this project. They are the persons responsible for allowing me to
learn about real industrial world and finally I would like to give a special thanks to
Mr.Soundara Rajan (Head HR Manager, Nokia) helped me a lot in guiding me in
getting the project in such an esteemed company.
I will always be grateful to Mr.Ponnusamy V.P. (Head HR Manager, Reckitt
Benckiser) for referring me to HR Manager of Nokia and for the advices he gave in
selecting stream and company for doing my project.






With Sincere Gratitude,
KAVINKUMAR S.

3


ABSTRACT
Efficiency is the foremost important reason, for the existence of any
Manager. In manufacturing industries, Labor force is one of the main
sources of cost incurred in production process. To maximize the profit of any
company, cost reduction is the basic step to be taken. Optimal utilization of
this labor force reduces great amount of costs incurred in the production
process.
Headcount is the number of persons allotted to do a job. In the
purview of Headcount, skills of all the laborers are equal. In a production
line, this headcount shall be minimized as much as possible without
compromising the production level or legal standard defined for such
factories.
In Nokia, there are many production lines are simultaneously on the
run and the objective of my internship is to assess each production line for
the scope for optimizing the headcount allotted during the process layout
designing. As Nokia follows lean manufacturing, company always aims at
reducing the wastes in any form, to the maximum possible level.
Theoretical review of process layout and direct observation and
interviews with the operators in the production line helps to identify the
scopes for reducing the unnecessary manpower. For scientific proof, work
time study is taken and with the results, headcount optimization is done
after few weeks of trial run.
This optimization helps the company to implement its lean system of
manufacturing and cost reduction of minimum Rs. 2,40,000 per head per
annum, taking that each is been paid the salary of 20,000 per month.


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CONTENT
Chapter 1 Introduction
1.1. Objectives of the Internship .
1.2. Operations Management ....
1.3. Nokia Corporations ..
1.4. History of the Company ....
1.5. Operations ...
1.6. Divisions ...
1.7. Corporate Governance
Chapter 2 Lean Manufacturing - Study
2.1. Introduction ..
2.2. Features of Lean Manufacturing ..
2.3. History of Waste Reduction Thinking .
2.4. TPS Development .
2.5. Types of Waste .
2.6. Lean Manufacturing Vs TPS System ..
2.7. Lean Goals and Strategy
2.8. Steps to Achieve Lean Systems ..
Chapter 3 Plant Layout Design & Line Balancing Study
3.1. Cellular Manufacturing Layout Design ...
3.2. Muthers Systematic Layout Planning (SLP) .
3.3. Tools For Layout Design ..
3.4. Analytic Hierarchy Process (AHP) .
3.5. Process Layout
3.6. Product Layout
3.7. The Assembly Process ..
3.8. The Line Balancing Problem .
3.9. Methods Of Line Balancing ....
Chapter 4 Process Layouts of a Product Line - Garnet
4.1. Stages Of Mobile Devices Production
4.2. Products Currently Under Production

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4.3. Base Assembly
4.4. Final Assembly
4.5. Standard Operating Procedures
Chapter 5 Head Count Optimization
5.1. Head Count
5.2. Headcount Optimization
5.3. Scope Identification
5.4. A Study On Job Design Of The Identified Scopes
5.5. Job-Time Study
5.6. Analysis
5.7. Result
5.8. Conclusion
Certifications
1. Internship Confirmation Certificate
2. Internship Completion Certificate
3. Photocopy of Identification card
Bibliography









6










Chapter 1


INTRODUCTION

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1.1 OBJECTIVES
1.1.1 LEARNING OBJECTIVES:
To fulfill the partial requirement for completion of MBA course
To get exposed to the Industrial Work Culture
To gain practical experience on the theories studied in the MBA course
1.1.2 INTERNSHIP OBJECTIVES
To review and verify headcount allocation as per the process layout.
To Optimize the Headcount in the target stages (Final Assembly, SOP/ESOP)
To Scientifically prove the optimization process with trial Runs and Work time
analysis
1.2 OPERATIONS MANAGEMENT:
Operations management is an area of management concerned with overseeing,
designing, and controlling the process of production and redesigning business operations in the
production of goods or services. It involves the responsibility of ensuring that business
operations are efficient in terms of using as few resources as needed, and effective in terms of
meeting customer requirements. It is concerned with managing the process that converts
inputs (in the forms of materials, labor, and energy) into outputs (in the form of goods and/or
services). The relationship of operations management to senior management in commercial
contexts can be compared to the relationship of line officers to highest-level senior officers
in military science. The highest-level officers shape the strategy and revise it over time, while
the line officers make tactical decisions in support of carrying out the strategy. In business as in
military affairs, the boundaries between levels are not always distinct; tactical information
dynamically informs strategy, and individual people often move between roles over time.
1.3 NOKIA CORPORATION:
The Nokia Corporation is a Finnish multinational communications and information
technology corporation (originally a paper production plant) that is headquartered in Espoo,
Finland. Its principal products are mobile telephones and portable IT devices. It also offers
Internet services including applications, games, music, media and messaging, and free-of-
charge digital map information and navigation services through its wholly owned subsidiary
Navteq. Nokia has a joint venture with Siemens, Nokia Siemens Networks, which provides
telecommunications network equipment and services. As of 2012, Nokia employs 101,982

8

people across 120 countries, conducts sales in more than 150 countries, and reports annual
revenues of around 30 billion. By 2012, it was the world's second-largest mobile phone maker
in terms of unit sales (after Samsung), with a global market share of 22.5% in the first quarter of
that year. Nokia is a public limited-liability company listed on the Helsinki Stock Exchange and
New York Stock Exchange. It is the world's 143rd-largest company measured by 2011 revenues
according to the Fortune Global 500. Nokia was the world's largest vendor of mobile phones
from 1998 to 2012.
However, over the past five years its market share declined as a result of the growing
use of touch screen smart phones from other vendorsprincipally the iPhone, by Apple, and
devices running on Android, an operating system created by Googlein which Nokia did not
take enough advantage of. As a result, the corporation's share price fell from a high of US $40 in
late 2007 to under US$2 in mid-2012.
In a bid to recover, Nokia announced a strategic partnership with Microsoft in February
2011, leading to the replacement of Symbian with Microsoft's Windows Phone operating
system in all Nokia smart phones. Following the replacement of the Symbian system, Nokia's
smart phone sales figures, which had previously increased, collapsed dramatically. From the
beginning of 2011 until 2013, Nokia fell from its position as the world's largest smart phone
vendor to assume the status of tenth largest. As of July 2013, Nokia's flagship product is the
Nokia Lumia 920, in addition to its successors, the 925 and the 928.

1.4 HISTORY OF THE COMPANY:
1.4.1 1865 to 1967
The predecessors of the modern Nokia were the Nokia Company (Nokia Aktiebolag),
Finnish Rubber Works Ltd (Suomen Gummitehdas Oy) and Finnish Cable Works Ltd (Suomen
Kaapelitehdas Oy). Nokia's history started in 1865 when mining engineer Fredrik Idestam
established wood pulp mill on the banks of the Tammerkoski rapids in the town of Tampere, in
southwestern Finland in the Russian Empire and started manufacturing paper. In 1868, Idestam
built a second mill near the town of Nokia, fifteen kilometers (nine miles) west of Tampere by
the Nokian Virta River, which had better resources for hydropower production. In 1871,
Idestam, with the help of his close friend statesman Leo Mechelin, renamed and transformed
his firm into a share company, thereby founding the Nokia Company, the name it is still known
by today.
Toward the end of the 19th century, Mechelin's wishes to expand into the electricity
business were at first thwarted by Idestam's opposition. However, Idestam's retirement from
the management of the company in 1896 allowed Mechelin to become the company's
chairman (from 1898 until 1914) and sell most shareholders on his plans, thus realizing his
vision. In 1902, Nokia added electricity generation to its business activities and become an

9

Industrial conglomerate. In 1898, Eduard Poln founded Finnish Rubber Works, manufacturer
of galoshes and other rubber products, which later became Nokia's rubber business.
At the beginning of the 20th century, Finnish Rubber Works established its factories
near the town of Nokia and they began using Nokia as its product brand. In 1912, Arvid
Wickstrm founded Finnish Cable Works, producer of telephone, telegraph and electrical cables
and the foundation of Nokia's cable and electronics businesses. At the end of the 1910s, shortly
after World War I, the Nokia Company was nearing bankruptcy. To ensure the continuation of
electricity supply from Nokia's generators, Finnish Rubber Works acquired the business of the
insolvent company. In 1922, Finnish Rubber Works acquired Finnish Cable Works. In 1937,
Verner Weckman, a sport wrestler and Finland's first Olympic Gold medalist, became president
of Finnish Cable Works, after 16 years as its technical director. After World War II, Finnish Cable
Works supplied cables to the Soviet Union as part of Finland's war reparations. This gave the
company a good foothold for later trade. The three companies, which had been jointly owned
since 1922, were merged to form a new industrial conglomerate, Nokia Corporation in 1967
and paved the way for Nokia's future as a global corporation.[22] The new company was
involved in many industries, producing at one time or another paper products, car and bicycle
tires, footwear (including rubber boots), communications cables, televisions and other
consumer electronics, personal computers, electricity generation machinery, robotics,
capacitors, military communications and equipment (such as the SANLA M/90 device and the
M61 gas mask for the Finnish Army), plastics, aluminum and chemicals. Each business unit
had its own director who reported to the first Nokia Corporation President, Bjorn Westerlund.
As the president of the Finnish Cable Works, he had been responsible for setting up the
company's first electronics department in 1960, sowing the seeds of Nokia's future in
telecommunications. Eventually, the company decided to leave consumer electronics behind in
the 1990s and focused solely on the fastest growing segments in telecommunications. Nokian
Tires, manufacturer of tires, split from Nokia Corporation to form its own company in 1988 and
two years later Nokian Footwear, manufacturer of rubber boots, was founded. During the rest
of the 1990s, Nokia divested itself of all of its non-telecommunications businesses.
1.4.2 1967 to 2000:
The seeds of the current incarnation of Nokia were planted with the founding of the
electronics section of the cable division in 1960 and the production of its first electronic device
in 1962: a pulse analyzer designed for use in nuclear power plants. In the 1967 fusion, that
section was separated into its own division, and began manufacturing telecommunications
equipment. A key CEO and subsequent Chairman of the Board wasvuorineuvos Bjorn "Nalle"
Westerlund (19122009), who founded the electronics department and let it run at a loss for 15
years.
1.4.3 NETWORKING EQUIPMENT

10

In the 1970s, Nokia became more involved in the telecommunications industry by
developing the Nokia DX 200, a digital switch for telephone exchanges. The DX 200 became the
workhorse of the network equipment division. Its modular and flexible architecture enabled it
to be developed into various switching products. In 1984, development of a version of
the exchange for the Nordic Mobile Telephony network was started. For a while in the 1970s,
Nokia's network equipment production was separated into Telefenno, a company jointly owned
by the parent corporation and by a company owned by the Finnish state. In 1987, the state sold
its shares to Nokia and in 1992 the name was changed to Nokia Telecommunications.
In the 1970s and 1980s, Nokia developed the Sanomalaite jrjes telm ("Message device
system"), a digital, portable and encrypted text-based communications device for the Finnish
Defense Forces. The current main unit used by the Defense Forces is the Sanomalaite M/90
(SANLA M/90). In 1998, Check Point established a partnership with Nokia, which bundled Check
Point's Software with Nokia's computer Network Security Appliances.
1.4.4 FIRST MOBILE PHONES
The technologies that preceded modern cellular mobile telephony systems were the
various "0G" pre-cellular mobile radio telephony standards. Nokia had been producing
commercial and some military mobile radio communications technology since the 1960s,
although this part of the company was sold some time before the later company
rationalization. Since 1964, Nokia had developed VHF radio simultaneously with Salora Oy. In
1966, Nokia and Salora started developing the ARP standard (which stands for Autora
diopuhelin or car radio phone in English), a car-based mobile radio telephony system and the
first commercially operated public mobile phone network in Finland. It went online in 1971 and
offered 100% coverage in 1978.
In 1979, the merger of Nokia and Salora resulted in the establishment of Mobira Oy.
Mobira began developing mobile phones for the NMT (Nordic Mobile Telephony) network
standard, the first-generation, first fully automatic cellular phone system that went online in
1981. In 1982, Mobira introduced its first car phone, the Mobira Senator for NMT-450
networks. Nokia bought Salora Oy in 1984 and now owning 100% of the company.
The Mobira Talkman, launched in 1984, was one of the world's first transportable
phones. In 1987, Nokia introduced one of the world's first handheld phones, the Mobira
Cityman 900 for NMT-900 networks (which, compared to NMT-450, offered a better signal, yet
a shorter roam). While the Mobira Senator of 1982 had weighed 9.8 kg (22 lb) and the Talkman
just under 5 kg (11 lb), the Mobira Cityman weighed only 800 g (28 oz) with the battery and had
a price tag of 24,000 Finnish marks (approximately 4,560).[33] Despite the high price, the first
phones were almost snatched from the sales assistants' hands. Initially, the mobile phone was a
"yuppie" product and a status symbol. Nokia's mobile phones got a big publicity boost in 1987,
when Soviet leader Mikhail Gorbachev was pictured using a Mobira Cityman to make a call from
Helsinki to his communications minister in Moscow. This led to the phone's nickname of the

11

"Gorba". In 1988, Jorma Nieminen, resigning from the post of CEO of the mobile phone unit,
along with two other employees from the unit, started a notable mobile phone company of
their own, Benefon Oy (since renamed to GeoSentric). One year later, Nokia-Mobira Oy became
Nokia Mobile Phones.

1.4.5 INVOLVEMENT IN GSM
Nokia was one of the key developers of GSM (Global System for Mobile
Communications), the second generation mobile technology which could carry data as well as
voice traffic. NMT (Nordic Mobile Telephony), the world's first mobile telephony standard that
enabled international roaming, provided valuable experience for Nokia for its close
participation in developing GSM, which was adopted in 1987 as the new European standard for
digital mobile technology. Nokia delivered its first GSM network to the Finnish operator
Radiolinja in 1989. The world's first commercial GSM call was made on 1 July 1991 in Helsinki,
Finland over a Nokia-supplied network, by then Prime Minister of Finland Harri Holkeri, using a
prototype Nokia GSM phone. In 1992, the first GSM phone, the Nokia 1011, was launched. The
model number refers to its launch date, 10 November. The Nokia 1011 did not yet employ
Nokia's characteristic ringtone, the Nokia tune. It was introduced as a ringtone in 1994 with the
Nokia 2100 series.
GSM's high-quality voice calls, easy international roaming and support for new services
like text messaging (SMS) laid the foundations for a worldwide boom in mobile phone use. GSM
came to dominate the world of mobile telephony in the 1990s, in mid-2008 accounting for
about three billion mobile telephone subscribers in the world, with more than 700 mobile
operators across 218 countries and territories. New connections are added at the rate of 15 per
second, or 1.3 million per day.
Reduction in size of Nokia mobile phones featured 32GB of on-board memory with a
3.2" finger touch interface and comes with a music playback time of 35 hours. The Nokia X3 was
the first series 40 Ovi Store-enabled device. The X3 was a music device that comes with stereo
speakers, built-in FM radio, and a 3.2 megapixel camera. In 2009, Nokia also unveiled the 7705
Twist, a phone sporting a square shape that swiveled open to reveal a full QWERTY keypad,
featuring 3 megapixel cameras, web browsing, voice commands and weighting around 3.44
ounces (98 g).
On 9 August 2012, Nokia launched for the Indian market two new Asha range of
handsets equipped with cloud accelerated Nokia browser, helping users browse the Internet
faster and lower their spend on data charges. Nokia N73 released in August 2006, with 3G and a
front camera. (S60 3rd) The Nokia N95 released in March 2007, with a 5 megapixel camera and
sliding multimedia keys often considered Nokias hero Smartphone. (S60 3rd) Nokia E71 with a
QWERTY keyboard, released in July 2008. (S60 3rd) The Nokia 5800 Xpress Music, Nokia's first
full-touch Smartphone. (S60 5th) The Nokia N97 released in June 2009 contains a sliding

12

QWERTY and has on-board 32 GB of storage. (S60 5th) The Nokia N8 released in September
2010 is the first Symbian device, and the first to feature a 12megapixel autofocus lens.
The Nokia 808 Pure View, released in February 2012 as the last Symbian smart phone,
features a 41megapixel camera and a 1.3 GHz CPU.

1.4.6 ALLIANCE WITH MICROSOFT
On 11 February 2011, Nokia's CEO Stephen Elop, a former head of Microsoft business
division, unveiled a new strategic alliance with Microsoft, and announced it would replace
Symbian and MeeGo with Microsoft's Windows Phone operating system except for mid-to-low-
end devices, which would continue to run under Symbian. Nokia was also to invest into the
Series 40 platform and release a single MeeGo product in 2011. As part of the restructuring
plan, Nokia planned to reduce spending on research and development, instead customizing and
enhancing the software line for Windows Phone 7. Nokia's "applications and content store"
(Ovi) becomes integrated into the Windows Phone Store, and Nokia Maps is at the heart of
Microsoft's Bing and AdCenter. Microsoft provides developer tools to Nokia to replace the Qt
framework, which is not supported by Windows Phone 7 devices.
Symbian became described by Elop as a "franchise platform" with Nokia planning to sell
150 million Symbian devices after the alliance was set up. MeeGo emphasis was on longer-term
exploration, with plans to ship "a MeeGo-related product" later in 2012. Microsoft's search
engine, Bing was to become the search engine for all Nokia phones. Nokia also intended to get
some level of customization on WP7. After this announcement, Nokia's share price fell about
14%, its biggest drop since July 2009. As Nokia was the largest mobile phone and smartphone
manufacturer worldwide at the time, it was suggested the alliance would make Microsoft's
Windows Phone 7 a stronger contender against Android and iOS. Because previously increasing
sales of Symbian Smartphone began to fall rapidly in the beginning of 2011, Nokia was
overtaken by Apple as the world's biggest Smartphone maker by volume in June 2011.
1.5 OPERATIONS
In 2011, Nokia had 130,000 employees in 120 countries, sales in more than 150
countries, global annual revenue of over 38 billion, and operating loss of 1 billion. It was the
world's largest manufacturer of mobile phones in 2011, with global device market share of 23%
in the second quarter. The Nokia Research Center, founded in 1986, is Nokia's industrial
Research unit consisting of about 500 researchers, engineers and scientists; It has sites in seven
Countries: Finland, China, India, Kenya, Switzerland, the United Kingdom and the United States.
Besides its research centers, in 2001 Nokia founded (and owns) INdT Nokia Institute of
Technology, a R&D institute located in Brazil. Nokia operates a total of 9 manufacturing
facilities located at Salo, Finland; Manaus, Brazil; Cluj, Romania; Beijing and Dongguan, China;
Komrom, Hungary; Chennai, India; Reynosa, Mexico; and Changwon, South Korea. Nokia's

13

industrial design department is headquartered in Soho in London, UK with significant satellite
offices in Helsinki, Finland and Calabasas, California in the US.
Nokia is a public limited-liability company listed on the Helsinki, Frankfurt, and New York
stock exchanges. Nokia plays a very large role in the economy of Finland. It is an important
employer in Finland and several small companies have grown into large ones as its partners and
subcontractors. In 2009 Nokia contributed 1.6% to Finland's GDP, and accounted for about 16%
of Finland's exports in 2006.
1.7 DIVISIONS
Since 1 July 2010, Nokia comprises three business groups: Mobile Solutions, Mobile
Phones and Markets. The three units receive operational support from the Corporate
Development Office, led by Kai istm, which is also responsible for exploring corporate
strategic and future growth opportunities. On 1 April 2007, Nokia's Networks business group
was combined with Siemens's carrier-related operations for fixed and mobile networks to form
Nokia Siemens Networks, jointly owned by Nokia and Siemens and consolidated by Nokia.
Nokia bought the 50% share and took full control of the group on July 3, 2013.
1.8 CORPORATE GOVERNANCE
The control and management of Nokia is divided among the shareholders at a general
meeting and the Nokia Leadership Team (left), under the direction of the Board of Directors
(right). The Chairman and the rest of the Nokia Leadership Team members are appointed by the
Board of Directors. Only the Chairman of the Nokia Leadership Team can belong to both, the
Board of Directors and the Nokia Leadership Team. The Board of Directors committees consist
of the Audit Committee, the Personnel Committee and the Corporate Governance and
Nomination Committee.
















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Chapter 2






LEAN MANUFACTURING

15


2.1 INTRODUCTION:
Lean manufacturing, lean enterprise, or lean production, often simply, "Lean", is a
production practice that considers the expenditure of resources for any goal other than the
creation of value for the end customer to be wasteful, and thus a target for elimination.
Working from the perspective of the customer who consumes a product or service, "value" is
defined as any action or process that a customer would be willing to pay for.
Essentially, lean is centered on preserving value with less work. Lean manufacturing is a
management philosophy derived mostly from the Toyota Production System (TPS) (hence the
term Toyotism is also prevalent) and identified as "Lean" only in the 1990s TPS is renowned for
its focus on reduction of the original Toyota seven wastes to improve overall customer value,
but there are varying perspectives on how this is best achieved. The steady growth of Toyota,
from a small company to the world's largest automaker,

has focused attention on how it has
achieved this success
Lean principles are derived from the Japanese manufacturing industry. The term was
first coined by John Krafcik in his 1988 article, "Triumph of the Lean Production System," based
on his master's thesis at the MIT Sloan School of Management. Krafcik had been a quality
engineer in the Toyota-GM NUMMI joint venture in California before coming to MIT for MBA
studies. Krafcik's research was continued by the International Motor Vehicle Program (IMVP) at
MIT, which produced the international best-seller book co-authored by Jim Womack, Daniel
Jones, and Daniel Roos called The Machine That Changed the World.
For many, Lean is the set of "tools" that assist in the identification and steady
elimination of waste (muda). As waste is eliminated quality improves while production time and
cost are reduced. A non exhaustive list of such tools would include: SMED, Value Stream
Mapping, Five S, Kanban (pull systems), poka-yoke (error-proofing), Total Productive
Maintenance, elimination of time batching, mixed model processing, Rank Order Clustering,
single point scheduling, redesigning working cells, multi-process handling and control
charts (for checking mura).
Toyota's view is that the main method of Lean is not the tools, but the reduction of
three types of waste:
Muda (non-value-adding work)
Muri (overburden)

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Mura (unevenness)
2.2 FEATURES OF LEAN MANUFACTURING:
Also known as the flexible mass production, the TPS has two pillar concepts: Just-in-
time (JIT) or "flow", and "autonomation" (smart automation). Adherents of the Toyota
approach would say that the smooth flowing delivery of value achieves all the other
improvements as side-effects. If production flows perfectly (meaning it is both "pull" and with
no interruptions) then there is no inventory; if customer valued features are the only ones
produced, then product design is simplified and effort is only expended on features the
customer values. The other of the two TPS pillars is the very human aspect of autonomation,
whereby automation is achieved with a human touch. In this instance, the "human touch"
means to automate so that the machines/systems are designed to aid humans in focusing on
what the humans do best. This aims, for example, to give the machines enough intelligence to
recognize when they are working abnormally and flag this for human attention. Thus, in this
case, humans would not have to monitor normal production and only have to focus on
abnormal, or fault, conditions.
Lean implementation is therefore focused on getting the right things to the right place
at the right time in the right quantity to achieve perfect work flow, while minimizing waste and
being flexible and able to change. These concepts of flexibility and change are principally
required to allow production leveling (Heijunka), using tools like SMED, but have their
analogues in other processes such as research and development (R&D). The flexibility and
ability to change are within bounds and not open-ended and therefore often not expensive
capability requirements. More importantly, all of these concepts have to be understood,
appreciated, and embraced by the actual employees who build the products and therefore own
the processes that deliver the value. The cultural and managerial aspects of Lean are possibly
more important than the actual tools or methodologies of production itself. There are many
examples of Lean tool implementation without sustained benefit, and these are often blamed
on weak understanding of Lean throughout the whole organization.
Lean aims to make the work simple enough to understand, do and manage. To achieve
these three goals at once there is a belief held by some that Toyota's mentoring
process,(loosely called Senpai and Kohai, which is Japanese for senior and junior), is one of the
best ways to foster Lean Thinking up and down the organizational structure. This is the process
undertaken by Toyota as it helps its suppliers improve their own production. The closest
equivalent to Toyota's mentoring process is the concept of "Lean Sensei," which encourages
companies, organizations, and teams to seek outside, third-party experts, who can provide
unbiased advice and coaching.

17


In 1999, Spear and Bowen

identified four rules which characterize the "Toyota DNA":
Rule 1: All work shall be highly specified as to content, sequence, timing, and outcome.
Rule 2: Every customer-supplier connection must be direct, and there must be an unambiguous
yes or no way to send requests and receive responses.
Rule 3: The pathway for every product and service must be simple and direct.
Rule 4: Any improvement must be made in accordance with the scientific method, under the
guidance of a teacher, at the lowest possible level in the organization.

2.3 HISTORY OF WASTE REDUCTION THINKING
The avoidance of waste has a long history. In fact many of the concepts now seen as key
to lean have been discovered and rediscovered over the years by others in their search to
reduce waste. Lean manufacturing builds on their experiences, including learning from their
mistakes.
2.3.1 Pre-20th Century:
Most of the basic goals of lean manufacturing are common sense, and documented
examples can be seen as early as Benjamin Franklin. Poor Richard's Almanac says of wasted
time, "He that idly loses 5s. worth of time, loses 5s., and might as prudently throw 5s. into the
river." He added that avoiding unnecessary costs could be more profitable than increasing
sales: "A penny saved is two pence clear. A pin a-day is a groat a-year. Save and have."Again
Franklin's The Way to Wealth says the following about carrying unnecessary inventory. "You call
them goods; but, if you do not take care, they will prove evils to some of you. You expect they
will be sold cheap, and, perhaps, they may [be bought] for less than they cost; but, if you have
no occasion for them, they must be dear to you. Remember what Poor Richard says, 'Buy what
thou hast no need of, and ere long thou shalt sell thy necessaries.' In another place he says,
'Many have been ruined by buying good penny worths'." Henry Ford cited Franklin as a major
influence on his own business practices, which included Just-in-time manufacturing. The
concept of waste being built into jobs and then taken for granted was noticed by motion
efficiency expert Frank Gilbreth, who saw that masons bent over to pick up bricks from the
ground. The bricklayer was therefore lowering and raising his entire upper body to pick up a
2.3 kg (5 lb.) brick, and this inefficiency had been built into the job through long practice.

18

Introduction of a non-stooping scaffold, which delivered the bricks at waist level, allowed
masons to work about three times as quickly, and with less effort.
2.3.2 20th century:
Frederick Winslow Taylor, the father of scientific management, introduced what are
now called standardization and best practice deployment. In his Principles of Scientific
Management, (1911), Taylor said: "And whenever a workman proposes an improvement, it
should be the policy of the management to make a careful analysis of the new method, and if
necessary conduct a series of experiments to determine accurately the relative merit of the
new suggestion and of the old standard. And whenever the new method is found to be
markedly superior to the old, it should be adopted as the standard for the whole
establishment." Taylor also warned explicitly against cutting piece rates (or, by implication,
cutting wages or discharging workers) when efficiency improvements reduce the need for raw
labor: "after a workman has had the price per piece of the work he is doing lowered two or
three times as a result of his having worked harder and increased his output, he is likely entirely
to lose sight of his employer's side of the case and become imbued with a grim determination
to have no more cuts if soldiering [marking time, just doing what he is told] can prevent it."
Shigeo Shingo, the best-known exponent of single minute exchange of die and error-proofing or
poka-yoke, cites Principles of Scientific Management as his inspiration.

American industrialists
recognized the threat of cheap offshore labor to American workers during the 1910s, and
explicitly stated the goal of what is now called lean manufacturing as a countermeasure. Henry
Towne, past President of the American Society of Mechanical Engineers, wrote in the Foreword
to Frederick Winslow Taylor's Shop Management (1911), "We are justly proud of the high wage
rates which prevail throughout our country, and jealous of any interference with them by the
products of the cheaper labor of other countries. To maintain this condition, to strengthen our
control of home markets, and, above all, to broaden our opportunities in foreign markets
where we must compete with the products of other industrial nations, we should welcome and
encourage every influence tending to increase the efficiency of our productive processes."
2.4 TPS DEVELOPMENT
Toyota's development of ideas that later became Lean may have started at the turn of
the 20th century with Sakichi Toyoda, in a textile factory with looms that stopped themselves
when a thread broke. This became the seed of autonomation and Jidoka. Toyota's journey with
JIT may have started back in 1934 when it moved from textiles to produce its first car. Kiichiro
Toyoda, founder of Toyota Motor Corporation, directed the engine casting work and discovered
many problems in their manufacture. He decided he must stop the repairing of poor quality by
intense study of each stage of the process. In 1936, when Toyota won its first truck contract

19

with the Japanese government, his processes hit new problems and he developed the "Kaizen"
improvement teams.
Levels of demand in the Post War economy of Japan were low and the focus of mass
production on lowest cost per item via economies of scale therefore had little application.
Having visited and seen supermarkets in the USA, Taiichi Ohno recognized the scheduling of
work should not be driven by sales or production targets but by actual sales. Given the financial
situation during this period, over-production had to be avoided and thus the notion of Pull
(build to order rather than target driven Push) came to underpin production scheduling.
It was with Taiichi Ohno at Toyota that these themes came together. He built on the
already existing internal schools of thought and spread their breadth and use into what has
now become the Toyota Production System (TPS).
2.5 TYPES OF WASTE
While the elimination of waste may seem like a simple and clear subject it is noticeable
that waste is often very conservatively identified. This then hugely reduces the potential of such
an aim. The elimination of waste is the goal of Lean, and Toyota defined three broad types of
waste: muda, muri and mura; it should be noted that for many Lean implementations this list
shrinks to the first waste type only with corresponding benefits decrease. To illustrate the state
of this thinking Shigeo Shingo observed that only the last turn of a bolt tightens itthe rest is
just movement. This ever finer clarification of waste is key to establishing distinctions between
value-adding activity, waste and non-value-adding work. Non-value adding work is waste that
must be done under the present work conditions. One key is to measure, or estimate, the size
of these wastes, to demonstrate the effect of the changes achieved and therefore the
movement toward the goal.
The "flow" (or smoothness) based approach aims to achieve JIT, by removing the
variation caused by work scheduling and thereby provide a driver, rationale or target and
priorities for implementation, using a variety of techniques. The effort to achieve JIT exposes
many quality problems that are hidden by buffer stocks; by forcing smooth flow of only value-
adding steps, these problems become visible and must be dealt with explicitly.
Muri is all the unreasonable work that management imposes on workers and machines
because of poor organization, such as carrying heavy weights, moving things around, dangerous
tasks, even working significantly faster than usual. It is pushing a person or a machine beyond
its natural limits. This may simply be asking a greater level of performance from a process than
it can handle without taking shortcuts and informally modifying decision criteria. Unreasonable
work is almost always a cause of multiple variations.

20

To link these three concepts is simple in TPS and thus Lean. Muri focuses on the
preparation and planning of the process, or what work can be avoided proactively by design.
Next, mura then focuses on how the work design is implemented and the elimination of
fluctuation at the scheduling or operations level, such as quality and volume. Muda is then
discovered after the process is in place and is dealt with reactively. It is seen through variation
in output. It is the role of management to examine the muda, in the processes and eliminate
the deeper causes by considering the connections to the muri and mura of the system.
The muda and mura inconsistencies must be fed back to the muri, or planning, stage for the
next project.
A typical example of the interplay of these wastes is the corporate behavior of "making
the numbers" as the end of a reporting period approaches. Demand is raised to 'make plan,'
increasing (mura), when the "numbers" are low, which causes production to try to squeeze
extra capacity from the process, which causes routines and standards to be modified or
stretched. This stretch and improvisation leads to muri-style waste, which leads to downtime,
mistakes and back flows, and waiting, thus the muda of waiting, correction and movement.
The original seven muda are:
Transport (moving products that are not actually required to perform the processing)
Inventory (all components, work in process and finished product not being processed)
Motion (people or equipment moving or walking more than is required to perform the
processing)
Waiting (waiting for the next production step)
Overproduction (production ahead of demand)
Over Processing (resulting from poor tool or product design creating activity)
Defects (the effort involved in inspecting for and fixing defects)
Later an eighth waste was defined by Womack et al. It was described as manufacturing
goods or services that do not meet customer demand or specifications. Many others have
added the "waste of unused human talent" to the original seven wastes. These wastes were not
originally a part of the seven deadly wastes defined by Taiichi Ohno in TPS, but were found to
be useful additions in practice. For a complete listing of the "old" and "new" wastes see
Bicheno and Holweg (2009)
Some of these definitions may seem rather idealistic, but this tough definition is seen as
important and they drove the success of TPS. The clear identification of non-value-adding work,
as distinct from wasted work, is critical to identifying the assumptions behind the current work
process and to challenging them in due course. Breakthroughs in SMED and other process

21

changing techniques rely upon clear identification of where untapped opportunities may lie if
the processing assumptions are challenged.
2.6 LEAN MANUFACTURING Vs TPS SYSTEM
While Lean is seen by many as a generalization of the Toyota Production System into
other industries and contexts there are some acknowledged differences that seem to have
developed in implementation.
1. Seeking profit is a relentless focus for Toyota exemplified by the profit maximization
principle (Price Cost = Profit) and the need, therefore, to practice systematic cost
reduction (through TPS or otherwise) to realize benefit. Lean implementations can tend
to de-emphasize this key measure and thus become fixated with the implementation of
improvement concepts of "flow" or "pull". However, the emergence of the "value curve
analysis" promises to directly tie lean improvements to bottom-line performance
measurements.
2. Tool orientation is a tendency in many programs to elevate mere tools (standardized
work, value stream mapping, visual control, etc.) to an unhealthy status beyond their
pragmatic intent. The tools are just different ways to work around certain types of
problems but they do not solve them for you or always highlight the underlying cause of
many types of problems. The tools employed at Toyota are often used to expose
particular problems that are then dealt with, as each tool's limitations or blind spots are
perhaps better understood. So, for example, Value Stream Mapping focuses upon
material and information flow problems but is not strong on Metrics, Man or Method.
Internally they well know the limits of the tool and understood that it was never
intended as the best way to see and analyze every waste or every problem related to
quality, downtime, personnel development, cross training related issues, capacity
bottlenecks, or anything to do with profits, safety, metrics or morale, etc. No one tool
can do all of that. For surfacing these issues other tools are much more widely and
effectively used.
3. Management technique rather than change agents has been a principle in Toyota from
the early 1950s when they started emphasizing the development of the production
manager's and supervisors' skills set in guiding natural work teams and did not rely upon
staff-level change agents to drive improvements. This can manifest itself as a "Push"
implementation of Lean rather than "Pull" by the team itself. This area of skills
development is not that of the change agent specialist, but that of the natural
operations work team leader. Although less prestigious than the TPS specialists,
development of work team supervisors in Toyota is considered an equally, if not more
important, topic merely because there are tens of thousands of these individuals.

22

Specifically, it is these manufacturing leaders that are the main focus of training efforts
in Toyota since they lead the daily work areas, and they directly and dramatically affect
quality, cost, productivity, safety, and morale of the team environment. In many
companies implementing Lean the reverse set of priorities is true. Emphasis is put on
developing the specialist, while the supervisor skill level is expected to somehow
develop over time on its own.
2.7 LEAN GOALS AND STRATEGY
The espoused goals of Lean manufacturing systems differ between various authors.
While some maintain an internal focus, e.g. to increase profit for the organization, others claim
that improvements should be done for the sake of the customer
Some commonly mentioned goals are:
Improve quality: To stay competitive in today's marketplace, a company must
understand its customers' wants and needs and design processes to meet their
expectations and requirements.
Eliminate waste: Waste is any activity that consumes time, resources, or space but does
not add any value to the product or service.
Taking the first letter of each waste, the acronym "TIM WOOD" is formed. This is a common
way to remember the wastes.
Reduce time: Reducing the time it takes to finish an activity from start to finish is one of
the most effective ways to eliminate waste and lower costs.
Reduce total costs: To minimize cost, a company must produce only to customer
demand. Overproduction increases a companys inventory costs because of storage
needs.
The strategic elements of Lean can be quite complex, and comprise multiple elements. Four
different notions of Lean have been identified:
1. Lean as a fixed state or goal (Being Lean)
2. Lean as a continuous change process (Becoming Lean)
3. Lean as a set of tools or methods (Doing Lean/Toolbox Lean)
4. Lean as a philosophy (Lean thinking)


23

2.8 STEPS TO ACHIEVE LEAN SYSTEMS:
The following steps should be implemented to create the ideal lean manufacturing
system:
1. Design a simple manufacturing system
2. Recognize that there is always room for improvement
3. Continuously improve the lean manufacturing system design
2.8.1 Design a simple manufacturing system
A fundamental principle of lean manufacturing is demand-based flow manufacturing. In
this type of production setting, inventory is only pulled through each production center when it
is needed to meet a customer's order. The benefits of this goal include:
Decreased cycle time
Less inventory
Increased productivity
Increased capital equipment utilization
2.8.2 Continuous Improvement
The core of lean is founded on the concept of continuous product and process improvement
and the elimination of non-value added activities. "The Value adding activities are simply only
those things the customer is willing to pay for, everything else is waste, and should be
eliminated, simplified, reduced, or integrated" (Rizzardo, 2003). Improving the flow of material
through new ideal system layouts at the customer's required rate would reduce waste in
material movement and inventory.












24






Chapter 3



PLANT LAYOUT DESIGN & LINE BALANCING


25


3.1 CELLULAR MANUFACTURING LAYOUT DESIGN
Layout design and the flow of materials have a significant impact on performance of
manufacturing system. These can help to increase productivity, reduce work in process and
inventory, short production lead time, streamlines the flow of materials, and reduce non value
added activities from the production process of waiting and transportation, which make the
factory meet customers' requirement quickly. There are many types of layout design in
manufacturing system such as process layout, product layout and cellular layout. A process
layout is suitable for high degree of interdepartmental flow and little intradepartmental flow. It
is proper for low-volume, high variety environment. On the other hand, a product layout is used
for high-volume, low-variety environment. A cellular layout is suggested for medium-volume
and medium-variety environment. This kind of layout is also appropriate for both automated
and non automated manufacturing systems. It can be design based on Group Technology (GT).
GT manufacturing offers several advantages which tend to improve productivity of a facility and
reduce its operating costs, waiting time between process, machine setup time, distance and
handling of work pieces, flow of materials between workstations. Several empirical studies
confirmed these advantages.
One of the effective methods for layout design was proposed by Muther which is called
Muthers systematic layout planning (SLP). This method presents layout planning step that can
be used sequentially to develop new layout or improve existing layout. However, many layout
design alternatives may be generated. Moreover, many kinds of performance measures may be
needed for evaluation. Multi criteria decision making (MCDM) is needed for evaluation the best
layout design based on selected criteria. This consideration is complicated, especially when
there are many criteria. One of the most popular and effective method for MCDM making
problem is Analytic Hierarchy Process (AHP), which has advantages in comparing alternatives
based on pair wise comparison. Both qualitative and quantitative criteria can be determined by
AHP. AHP has been successfully used in many applications such as supplier selection, system
selection and plant location, etc.
Electronic manufacturing service (EMS), which currently uses process layout, is
presented. EMS is a term used for companies that design, test, manufacture, distribute, and
return/repair services for electronic components and original equipment manufacturers
(OEMs). The business model for the EMS industry is to specialize in large economies of scale in
manufacturing, raw materials procurement and pooling together resources, industrial design
expertise as well as create added value services such as warranty and repairs. There are
varieties of orders under vast customers. These mean EMS Company has many types of
products to produce in different production routes and has large volume. So, the situation of

26

plant will be in a mess due to process layout. New layout for high-volume and high-variety
environment is considered. Cellular layout is selected for implementation in one part of the
current production plant due to the necessity of reduction of time, distance and flow within the
manufacturing plant. Moreover, some of variety products can be grouped as group families.
Then, SLP is applied for creating alternatives layout. Next, AHP is used to select the best layout
design based on critical criteria.
3.2 MUTHERS SYSTEMATIC LAYOUT PLANNING (SLP)
Systematic Layout Planning (SLP) was developed by Richard Muther in 1973 with 2 major
purposes; high frequency and logical relationship. There are 6 main procedures as follows:
1. Making Relationship Chart and from-to chart: In this procedure, relationship of each pair of
activities is determined and evaluated in relationship chart. A material flow analysis is done in
from-to chart.
2. Relationships Diagram: It is a diagram which symbols of proximity for all activities in the
layout are shown how activities in each area are related to others.
3. Space Requirements and space available: Resulted from measuring the space of
manufacturing process, machinery, and other manufacturing equipments of current
manufacturing plant and analyzing space required.
4. Space Relationship diagram: Utilized as a guideline for design alternative layouts.
5. Alternative layouts Evaluation: Developed alternatives are evaluated based on specific
criteria of each manufacturing plant.
6. Layout Selection and Installation: This final procedure is to select and to implement the
most prefer alternative.
For GT layout three major steps are required. They are:
i) Formation of part families and machine cell.
ii) Arrangement of the machines or work stations within each cell.
iii) Determining the configuration of cells on the facility floor.
3.3 TOOLS FOR LAYOUT DESIGN
There are many useful tools which can be used for analysis product, process and
schedule of the current manufacturing layout. After determining a product from the part

27

drawing then, processes and a schedule of that part are determined. This processes and
schedule information can be collected and gathered by the following tools.
3.3.1 Operation Process Chart: It is a chart which shows the overall understanding of the flow
within the facility. It is suitable for a study of main operations for any products which are in a
manufacturing plant.
3.3.2 Flow Process Chart: The operation process chart can be complemented with
transportations, storage and delays. Such a chart is referred to a flow process chart.
3.3.3 Flow Diagram: It is a diagram shown a direction of work flow according to the process
step.
3.3.4 Relationship Chart: This chart shows the relationship of each pair of activities. It is a
helpful tool for positioning activities in layout planning.
These tools are used for collecting the necessary data of the Layout study.
3.4 ANALYTIC HIERARCHY PROCESS (AHP)
Analytic Hierarchy Process is a process developed by Thomas Saaty. It used for
measuring decision-making level for each criterion and rearranging alternatives priority.
The process requires the decision makers to develop a hierarchical structure for the factors
which are explicit in the given problem and to provide judgments about the relative importance
of each of these factors, specify a preference for each decision alternative with respect to each
factor. It provides a prioritized ranking order indicating the overall preference for each of the
decision alternatives. An advantage of the AHP over other multi-criteria decision making
methods is that the AHP is designed to incorporate tangible as well as non-tangible factors
especially where the subjective judgments of different individuals constitute an important part
of the decision process.







28



3.5 PROCESS LAYOUT:
Process layout is a design for the floor plan of a plant which aims to
improve efficiency by arranging equipment according to its function. The production line should
ideally be designed to eliminate waste in material flows, inventory handling and
management. In process layout, the work stations and machinery are not arranged according to
a particular production sequence. Instead, there is an assembly of similar operations or similar
machinery in each department
3.6 PRODUCT LAYOUT:
Product layout refers to a production system where the work stations and equipment
are located along the line of production, as with assembly lines. Usually, work units are moved
along a line (not necessarily a geometric line, but a set of interconnected work stations) by
a conveyor. Work is done in small amounts at each of the work stations on the line. To use the
product layout, the total work to be performed must be dividable into small tasks that can be
assigned to each of the workstations. Because the work stations each do small amounts
of work, the stations utilize specific techniques and equipment tailored to the individual job
they are assigned. This can lead to a higher rate of production.

3.7 THE ASSEMBLY PROCESS:
Definition: Assembly involves the joining together of two or more separate parts to form a new
entity (Assembly or Subassembly).

Assembly Systems
There are various methods used in industry to accomplish the assembly processes.
Major methods can be classified:
3.7.1 Manual Single-Station Assembly
Consist of a single workplace to accomplish the product or some major subassembly of
the product.
Generally used on a product that is complex and produced in small quantities, one or
more workers depending on the size of the product and the production rate.
Such as machine tools, industrial equipment, aircraft, ships and complex consumer
products (appliances, car...)
3.7.2 Manual Assembly Lines
Consist of multiple workstations in which the assembly work is accomplished as the
product (subassembly) is passed from station to station along the line.

29

At each workstation one or more human workers perform a portion of the total
assembly work on the product, by adding one or more components to the existing
subassembly.
3.7.3 Automated Assembly System
Use of automated methods at the workstations rather than human beings is better.


3.7.4 MANUAL ASSEMBLY LINES
Are used in high-production situations where the work to be performed can be divided
into small tasks and tasks assigned to the workstations on the line.
Key advantage of using manual assembly line is specialization of labor By giving each
worker a limited set of tasks to do repeatedly.

Transfer of Work between Workstations
There are two basic ways in which the work is moved on the line between operator
workstations.
Non mechanical Lines
No belt or conveyor is used to move the parts. The parts are passed from station to
station by hand.
Problems:
Starving at stations wait for parts from the preceding station.
Blocking of station wait for the next operator to finish the task before passing along
the part.
Results:
The flow of work is usually uneven
Cycle time vary
Buffer stocks of parts between workstations are often used to smooth out the
production flow.

Moving Conveyer Lines
Use a moving conveyor (e.g. belt, convey, chain-in-the-floor)
Problems:
Starving can occur as with none-mechanical lines
Incomplete items are sometimes produced unable to finish the current part.
To control the feed rate of the line:
F
p
: denote feed rate
V
c
: conveyor speed
S
p
: Spacing between parts on the moving conveyor

F
p
= V
c
/ S
p


T
t
: The time period (tolerance time )
L
s
: is determined largely by the operators reach at the workstation


30

T
t
= L
s
/ V
c





3.8 THE LINE BALANCING PROBLEM:
The line balancing problem is to arrange the individual processing and assembly tasks at
the workstations so that the total time required at each workstation is approximately
the same.
If the work elements can be grouped so that all the station times are exactly equal, we
have perfect balance on the line and we can expect the production to flow smoothly.
In most practical situations it is very difficult to achieve perfect balance. When
workstation times are unequal, the slowest station determines the overall production
rate of the line.

TERMINOLOGY FOR LINE BALANCING

3.8.1 Minimum Rational Work Element
Minimum rational work element is the smallest practical indivisible tasks into which the
job can be divided. These work elements cannot be subdivided further
Example: drilling a hole, screw and nut etc.
T
ej
: where j is used to identify the element out of the n elements that make up the total work.

3.8.2 Total Work Content
Total work, T
wc
, content is the aggregate of all the work elements to be done on the line.


3.8.3 Workstation Process Time

31

Work is preformed either manually or by some automatic device. The work performed
at station consists of one or more of the individual work elements.
T
si
: indicate the process time at station i of an n stations line.

3.8.3 Cycle Time
Cycle time, T
c
, is the ideal or theoretical cycle time of the flow line, which is the time
interval between parts coming off the line.
When consider efficiency, E, the ideal cycle time must be reduce.



Where R
p
is production rate
At efficiencies less than 100% the ideal cycle time must be reduced (or ideal
production rate must be increased).

The minimum possible value of Tc is established by the bottleneck station, the

one with the largest value of T
c


Technological sequencing requirements, the order in which the work elements can be
accomplished is limited.
3.8.4 Precedence Diagram
Graphical representation of the sequence of work elements is defined by the
precedence constraints.

3.8.5 Balance Delay (Balancing Loss)
Balance delay is a measure of the line inefficiency which results from idle time due to
imperfect allocation of work among station.












32








3.9 METHODS OF LINE BALANCING
None of the methods guarantee an optimal solution, but they are likely to result in good
solutions which approach the true optimum.

3.9.1 Largest-Candidate Rule (LCR)

Procedure:
Step 1: List all elements in descending order of Te value, largest Te at the top of the list.
Step 2: To assign elements to the first workstation, start at the top of the list and work done,
selecting the first feasible element for placement at the station. A feasible element is one that
satisfies the precedence requirements and does not cause the sum of the T
ej
value at station to
exceed the cycle time T
c
.
Step 3: Repeat step 2.
3.9.2 Kilbridge and Wester's Method (KWM)
It is a heuristic procedure which selects work elements for assignment to stations
according to their position in the precedence diagram. This overcomes one of the difficulties
with the largest candidate rule (LCR), with which elements at the end of the precedence
diagram might be the first candidates to be considered, simply because their values are large.
Procedure:
Step 1: Construct the precedence diagram so those nodes representing work elements of
identical precedence are arranged vertically in columns.
Step 2: List the elements in order of their columns, column I at the top of the list. If an element
can be located in more than one column, list all columns by the element to show the
transferability of the element.
Step 3: To assign elements to workstations, start with the column I elements. Continue the
assignment procedure in order of column number until the cycle time is reached (T
c
).

3.9.3 Ranked Positional Weights Method (RPW)
Introduced by Helgeson and Birnie in 1961.
Combined the LCR and K-W methods
The RPWtakes account of both the Te value of the element and its position in the
precedence diagram.
Then, the elements are assigned to workstations in the general order of their
RPWvalues.
Procedure:
Step 1: Calculate the RPWfor each element by summing the elements Te together with the Te
values for all the elements that follow it in the arrow chain of the precedence diagram.

33

Step 2: List the elements in the order of their RPW, largest RPW at the top of the list. For
convenience, include the Te value and immediate predecessors for each element.
Step 3: Assign elements to stations according to RPW, avoiding precedence constraint and time
cycle violations.



3.9.4 Compare LCR, K-W and RPW
The RPW solution represents a more efficient assignment of work elements to
station than either of the two preceding solutions.
However, this result is accordingly by the acceptance of cycle time Tc = 1 and
make those methods different.
If the problem were reworked with T
c
= 0.92 minute, it might be possible to
duplicate the efficiency.
3.9.5 Other Ways to Improve the Line Balance

1. Dividing work elements
A minimum rational work element was defined as the smallest practical indivisible task.
For example: Drilling of a deep hole at one station was to cause a bottleneck situation should
be separated into two steps.
Advantages: Eliminates the bottleneck and increases the tool life.

2. Changing work lead speeds at automatic stations
Through a process increasing the speed/feed combinations at the stations with long process
time, and reducing the speed/feed combinations at stations with idle time.

3. Method analysis
The study of human work activity may result in better workplace layout, redesigned tooling and
fixture or improved hand and body motions.

4. Pre-assembly of components
Reduce the total amount of work done on the regular assembly line by another assembly cell or
by purchasing.
a. Required process may be difficult to implement on the regular assembly line.
b. Variations in process times (adjustments or fitting)

5. Inventory buffers between stations
Arrangements for buffers in between the working stations

6. Parallel stations.
Disregard the stations must be arranged sequentially.


34










Chapter 4




PROCESS LAYOUTS OF NOKIA PRODUCTS STUDY

















35



4.1 STAGES OF MOBILE DEVICES PRODUCTION:
4.1.1 Base Assembly:
This is the first stage of mobile device production, where mobile devices engine is
prepared. Here the Silicon wafer board is pasted with the various electronic components and
the engine thus prepared is sent to final assembly. In Nokia, this first stage is mostly automated.
4.1.2 Final Assembly:
In this stage, the base circuit board is fit with LCD screens, key mat, light guide, Speaker
and cameras are fixed. This stage is semi automated and human labor needed some of the cells
of the stage.
4.1.3 Standard Operating Procedures / Electronic SOP:
The standard operations done here are testing the LCD Screens, loading the software
into the mobile devices, Battery testing and Gift box packing. This is the last stage in production
and followed by either storing or shipping stage. Semi automated stage and Human labor is
required for mostly all the cells of this stage.

4.2 PRODUCTS CURRENTLY UNDER PRODUCTION:

S. No. Product
No. of Lines of Production
(During Normal Demand Period)
1 Garnet 3
2 Sana 1
3 Kepler 1
4 Luyan 1
5 Winger 2
6 Aqua 1
7 Talbot 1
8 Jay Jay 1
9 Johnny 2
10 Titan 2
11 Alladin 1
12 Wana 2
13 Christine 1
14 Mario 1
15 Gaia 1

Note: Product names given within the company are different from their actual names in the market

36

Upon these products that are manufactured in Nokias Chennai plant, Garnet is a very
popular moving product and it is a basic model mobile device. So, naturally any analysis would
start from the product Garnet and then proceed to other manufacturing lines.










SAMPLE PROCESS LAYOUT



GARNET

37


4.3 BASE ASSEMBLY





Operators for BA operations 5
Material Replenishment operator 1
Total no of operators / line / shift 6
No. of Shifts/ Day 3

BA HEAD COUNT
Stage Headcount
Paste printing 1 & 2 1
NXT module 1 1
NXT module 2 1
NXT module 3
1
AOI
Reflow 1

Process
Technical Capacity
(No.s/day)
Paste printing 1 & 2 69673
NXT 1 & NXT 2 60710
AOI 44974
NXT 3 39374
Reflow 40971

38


4.4 FINAL ASSEMBLY




Final Assembly
Stage Headcount
Dome Sheet Assembly 2
RAFLA 1
ACF 1
Light guide 5
Router 1
D Cover & Speaker Assembly 3
D Cover & PWBA Assembly 5
FINUI 4
VI 2 3
Direct line operators 25
Break time relievers- needs to do rework 3
Material replenishment 1
Total line operators 29
Process
Technical Capacity
(No.s/day)
Dome sheet Assembly 40755
RAFLA 36098
ACF 40876
Light Guide Assembly 44665
Router 44489
D cover & Speaker Assembly 39678
D cover & PWB Assembly 44187
FIN UI 44041



39


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I

V
I

Machine time (in sec)

100 7.53

6.2

23

Man time
/ Handling time (in sec)
14 12

33

4.9 19.0 4.8 14
Allowance for manual
time
1.08 1 1 1.08 1 1.08 1.08 1.08 1.08
No. of output / stage 4 4 4 4 4 1 3 1 3
No. of stages /
Equipments
2 13 1 4 1 3 4 16 3
No of operators 2 1 1 4 1 3 4 4 3
Stage Cycle time
(in sec / pc)
3.78 28 1.88 8.9 1.55 5.29 6.84 28.184 5.04
Stage MFR %
(PD4 targets)
0.10% 4.94% 0.20% 0.10% 0.10% 0.10% 0.10% 1.60% 0.00%
Stage Cycle time
(in sec / pc.)
1.89 2.15 1.88 2.23 1.55 1.76 1.71 1.76 1.68

40

Stage Cycle time
(in sec / pc.)
inflated with MFR
1.89 2.26 1.89 2.23 1.55 1.77 1.71 1.79 1.68
Stage
D
o
m
e

s
h
e
e
t

a
s
s
y

1

&

2

R
a
f
l
a

A
C
F

L
i
g
h
t

g
u
i
d
e

&

U
I

s
h
i
e
l
d

a
s
s
y

R
o
u
t
e
r

D

C
o
v
e
r

&

s
p
e
a
k
e
r

a
s
s
y

D

C
o
v
e
r

&

P
W
B
A

a
s
s
y

F
I
N
U
I

V
I

Theoretical Capacity
(Nos./hr)
1903 1593 1909 1615 2320 2039 2103 2012 2143
Theoretical Capacity
(Nos./day)
45669 38226 45805 38749 55686 48931 50476 48277 51429
Line ineffiency (%) 10.76% 14.58% 10.76%
10.58
%
18.91% 18.91% 18.91% 18.91%
18.91
%
Technical capacity
(Nos./hr)
1698 1361 1703 1575 2053 1804 1860 1779 1896
Technical capacity
(Nos./day)
40755 32653 40876 34649 45156 39678 40931 39148 41703
Daily target (Nos./day) 32653 32653 32653 32653 32653 32653 32653 32653 32653
Hourly Output
Theoretical target
(Nos./hr)
2039

Hourly Output
Theoretical target
(Nos./hr)
1653






41





4.5 STANDARD OPERATING PROCEDURES:




Stage Process Description
Stage time
in sec/unit
Balanced
time in
sec/unit
No of
operators
Takt time
in sec/ unit
S
p
a
d
e

-

1

Testing time
5.20
6.00 1 6.00
Unloading & Loading of engine
(3.00)
Pasting IMEI Label
(3.00)
A

c
o
v
e
r
,

K
e
y

m
a
t

&

T
r
a
n
s
c
e
i
v
e
r

a
s
s
e
m
b
l
y

A cover & Key mat assembly
(Trash clearing) 5.60
23.77 4 5.94
Ionizer , Removing protective tape
from transceiver & A cover 5.4
Ionizing, A cover & Key mat assy.
with transceiver 3.40
Assy & Check for Aesthetic Defect
in A cover & LCD 7.60
Engine bin movement
0.27
Tray changing & Trash clearing
1.50
S
c
r
e
w
i
n
g

Place the a cover assy. in Jig 2 no.
1.5
7.00 2.00 3.50
Screwing 2 screws in A cover Assy
4
Take & place the assy. in Bin
1.5
S
t
a
g
e

-

1

Placing compact box
1.10
5.60 1 5.60
Placing the Battery
2.00
Pick & Place the UG in GB and GB


42

movement
2.50
Stage Process Description
Stage time in
sec/unit
Balanced
time in
sec/unit
No of
operators
Takt time
in sec /
unit
S
t
a
g
e

-

2

Place the Charger
2.00
4.55 1 4.55
Inner flap folding
1.35
Check the Booklet inside the box

GB movement
1.20
S
t
a
g
e

-

3

Scanning the IMEI label - 2D
scanner
2.70
5.8 1 5.80
Check for Type label cross pasting
Pasting IMEI label on compact
box 1.55
Pasting MRP label on GB
1.55
O
F
F
L
I
N
E

B
a
c
k

s
i
d
e

o
f

t
h
e

c
e
l
l

Pasting the SAR sticker on B cover
( back side) 4.00 4.00 1 4.00
Paste Water Ingress sticker
3.5
5.50 1.00 5.50
G
B

S
t
i
c
k
e
r

Remove PT Tape from A cover
2.00
S
t
a
g
e

-

4

B cover assembly and fitness
checking 3.50
5.70 1.00 5.70 Poly bag assembly 2.20
closing the GB
1.4
5.00 1.00 5.00
Scanning & Weighing
3.60
S
t
a
g
e

-

5


Pasting VOID label on GB
4.5 4.50 1 4.50
S
t
a
g
e

-

6
Stacking GB in MC
4.00 4.00 1 4.00
Forming Master carton & taping
on bottom side
Pasting Void & package labels &

43

2D label
Closing & taping master carton &
placing in pallet
Total Process time in Sec
81.42
Critical Time in Sec
6.00
Head count
16
Theoretical capacity per day
14400
Output per Hour
600
Line capacity with considering 18.6%
10872
Line Imbalance %age 15.19


Theoretical Capacity
Critical Time in Sec 6.00
Output / Hour 600
Line capacity / Day / Cell 14400
MFR % (Non MFR + MFR )Excl. Retest MFR %age 0.5%
Engineering Downtimes
Planned Maintenance ( Weekly, Monthly / Mid-week ) 0.30%
Unexpected M/c. down time ( Equip. Break downs )
0.80%
Break-time (2 hrs in a day) 9.72%
Management loss - Line meetings 1.04%
Manpower issues ( Late coming after the break ) 1.74%
Material - Delay in SM, GB, Formeca, EB 0.50%
Quality - Incoming / Product 7.00%
Setting & Change over 3.50%
DT Delay 0.00%
Over all Loss %age 24.6%
Technical Capacity
OUTPUT / HOUR (In no.) Considering MFR 450
Line capacity / Day / Cell 10803



44













Chapter 5



HEAD COUNT OPTIMIZATION

(Study on RAFLA & ACF Operators)














45


5.1 HEAD COUNT:
Headcount is the collection of manpower utilized for performing some job. Each
employee can be accounted as a head count. In manufacturing industries, headcount is
accounted for optimizing the cost of laborer, by reducing headcount.
5.2 HEADCOUNT OPTIMIZATION:
Headcount Optimization refers to minimizing the manpower in a shop floor so as to
ensure the highest possible cost efficiency, without compromising on the output from the shop
floor.
5.3 SCOPE IDENTIFICATION:
The Scope for minimizing the headcount, which is already well planned after several
trials during designing of the process layout, is always there. At the product introduction stage,
the process time was different from that of process time after ramping up the product. There
are several methods to identify scope for minimizing headcount, of them direct interview with
the operators is the best model to know about loading of their job.
Scope identification is different from proving the identified scope as unnecessary
headcount. Automation of machines also gives ample scope for reducing manpower in a
production line.
5.3.1 Theoretical layout Study:
The first part of the headcount optimization begins from the study of theoretical layout
and to look for any possible automation of machines or possible inefficient design. Critical Time
of a cycle time needed to be reduced in order to maximize output in a given time and at the
same time manpower should be taken into consideration to be more cost efficient.
Theoretical layout of the production line is revised time to time in corporate companies
like Nokia, so scope cannot be identified at this stage but possible areas can be marked for
further analysis.
Base assembly stage is very well defined and less number of machines and each
machine needs an operator which is provided already. This leaves BA stage to be untouchable.
Final Assembly stage is not well defined, due to the combinations of semi automated
and manual working stations. In case of Garnet production line RAFLA and ACF machine

46

operators, Light guide assembly operators and dome sheet operators are the possible areas for
minimizing the headcounts.
5.3.2 Direct Observation:
The Second phase of the optimization process is to observe the activities of operators in
the shop floor and interviewing the operators for confirming the loading of their job. Genuine
responses are often cannot expect be expected, though direct observations are the true source
for identifying the inefficient loading of an operator.
Direct observations and interviewing the operators about their work load gave a clear
idea that RAFLA and ACF stage and light guide assembly areas are clearly not so optimally
allocated with manpower.
5.3.3 Scientific Proof Generation:
Scopes identified are not enough to remove the allocated manpower without any
scientific proof. For proving so, Job time analysis, string diagram analysis can be useful.
For proving the identified scope, scientifically, I preferred job time analysis in which the
utilization of the operators is identified in percentage.
5.4 A STUDY ON JOB DESIGN OF THE IDENTIFIED SCOPES
5.4.1 RAFLA Operator Roles & Responsibilities:
1. RAFLA issues are communicated to technician
2. Sometimes, if required Darium will be restarted and startup RAFLA.
3. Magazine loading in Panel flash loader.
5.4.2 ACF Operator Roles & Responsibilities:
1. Attend the limited issues in ACF and other ACF issues are inform to technician.
2. Loading LCD and unload the empty trays.
3. In requirements buffering the ACF output panels.
4. Collect the missing LCD boards from ACF and make identify, send to CSP rework in shift
ends.


47



5.5 JOB-TIME STUDY
5.5.1 Observation Method:
Manual Clocking made by Direct Observation
Sampling Period : 90 Minutes
Sampled in Shift B : 15.30 to 17.00 (Trial 1: 26/6/2013) (Trial 2: 28/6/2013)
5.5.2 RAFLA Operator
DESCRIPTION START TIME END TIME TOTAL TIME ELAPSED (sec)
Problem in RAFLA 15:32:36 15:33:02 26
Problem in RAFLA 15:33:34 15:34:18 44
Loading buffer from RAFLA 15:34:18 15:35 52
Loading magazine to BA 15:35:10 15:36:06 56
Reloading magazine to FA 15:36:06 15:36:12 6
Loading buffer from RAFLA 15:36:12 15:38:04 112
Problem in RAFLA 15:38:10 15:38:45 35
Loading buffer from RAFLA 15:38:45 15:38:50 5
Reloading magazine to FA 15:38:50 15:39:52 62
Loading buffer from RAFLA 15:44:02 15:44:12 10
Reloading magazine to FA from BA 15:44:12 15:49:55 283
Loading buffer to magazine from Trolley 15:49:55 15:53:30 215
Reloading magazine to FA 15:54:45 15:58:04 208
Team Leader teaching about Software 15:58:04 15:58:30 26

48

Problem in RAFLA 15:58:30 15:59:10 20
Note: These are sample from the study mad, not the complete table
5.5.2 ACF Operator:
DESCRIPTION
START TIME
(HH:MM:SS)
END TIME
(HH:MM:SS)
ELAPSED TIME
(Sec)
Loaded PWB from Buffer to input Conveyor 15:20:45 16:20:00 75
LCD Tray Loaded 15:22:17 15:22:35 18
Got New ACF Reel from Refrigerator 15:24:20 15:26:45 145
Error Handling 15:26:05 15:27:10 65
Outbound PWBs were stashed in buffer 15:31:43 15:31:53 10
New LCD tray bundle uncovered 15:31:22 15:31:42 20
Error Handling 15:15:10 15:20:15 5
Error Handling 15:33:45 15:33:50 5
Technicians were called 15:33:50 15:35:05 75
Technicians Attended the Issue Raised 15:35:05 15:48:16 731
Hourly Entry Logged 15:49:40 13:49:58 18
Error Handling 15:51:35 13:51:40 10
Loaded PWB from Buffer into input Conveyor 15:53:25 13:53:45 20
Manually Cleared PWBs unmoved properly by
conveyor
15:54:10 15:54:20 10
Loaded PWB from Buffer to Input Conveyor 15:58:05 15:58:12 7
Got New ACF Reel from Refrigerator 16:06:25 16:09:45 200
Loaded PWB from Buffer into input Conveyor 16:09:45 16:09:55 10

49

LCD Tray Loaded 16:10:05 16:10:25 20
Note: These are sample from the study mad, not the complete table

5.5.4 FINDINGS OF THE JOB-TIME STUDY:
ACF : TRIAL I
Work Done Duration (sec) No. of Occurrences
Error Handling 40 5
Got New ACF Reel from Refrigerator 345 2
Outbound PWBs Cleared 10 1
LCD Tray Loaded 53 3
LCD Tray Unloaded 8 1
ACF Reel Changed 195 1
Outbound PWBs were stashed in buffer 10 1
ACF Loaded from Buffer Input 112 4
New LCD tray bundle uncovered (Lethargic Act) 40 2
Technicians Attended the Issue Raised 731 1
Calling Technicians for Unsolvable or Repeated Errors 75 1
RAFLA : TRIAL I
Work Done Duration (Sec) No.of Occurrences
Error Handling 425 10
Loading RAFLA Output Buffer 349 6
Empty Magazines Loaded back in FA Input Buffer 221 2
Loading magazine to RAFLA 841 7

50

Loading Magazines from Input Buffer 225 2
Labeling output buffers Magazines 236 2
No Value Activity 1798

5.6 Analysis:
RAFLA Operator: Trial 1
Total Idle Time 3103 Sec
Sample Time Period 5400 Sec
No Value Activity 1798 Sec
Value Activity 2297 Sec
Utility 42.53703704 %
Down Time Occurred Nil


ACF Operator: Trial 1
Total Idle Time 3673 Sec
Sample Time Period 5400 Sec
No Value Activity 731 Sec
Value Activity 996 Sec
Utility (Elapsed Time / Total Sampling Period) 18.44 %
Down Time Occurred 806 Sec




51




TRIAL 1:

VALID ACTIVITY TIME (Sec) IDLE TIME (Sec) UTILITY
RAFLA EMPLOYEE 2417 2983 43.54 %
ACF EMPLOYEE 996 4404 18.44 %
TRIAL 2:

VALID ACTIVITY TIME (Sec) IDLE TIME (Sec) UTILITY
RAFLA EMPLOYEE 541 4859 10.02%
ACF EMPLOYEE 792 4608 14.67%


TRIAL 1 TRIAL 2

RAFLA ACF RAFLA ACF
Valid Activity Time 2417 996 515 447

52

Idle Time 2983 4404 4885 4953
Utility 43.54 % 18.44 % 10.02% 14.67%

ACF Occurrences
Average Time
(Sec)
Average
Calculated
Average
Time (Sec)
Frequency
(Per Hour)
Work
Time Per
Hour
(Sec)
Error Handling 26 311 11.96 12 8.67 104
LCD Trays Loaded 6 98 16.33 16 2 32
LCD Trays Unloaded 3 27 9 9 1 9
Empty Trays were
Arranged
76 76 1 1 25.33 25.33
Outbound PWBs
Cleared
10 20 2 2 3.33 6.67
Outbound PWBs
Buffered (Break time
Activity)
4 355 88.75 89 1.33 118.67
Inbound PWBs
Buffered
2 26 13 13 0.67 8.67
Got New ACF Reel
from Refrigerator
2 345 172.5 173 0.66 115.33
ACF Reel Changed 1 195 195 195 0.33 65
Calling Technicians
for Unslovable or
Repeated Errors
1 75 75 75 0.33 25
ACF Loaded from
Buffer Input
4 112 28 28 1.33 37.33

53

Average Work Time
Per Hour (Sec) 547
Average Utility per
Hour (%) 15.19

5.7 RESULT:
(COMBINED RESULT) VALID ACTIVITY TIME UTILITY
RAFLA EMPLOYEE 875 24.31 %
ACF EMPLOYEE 547 15.19%
Combined Work Load 1422 39.5


5.8 Conclusion:
Loading of any operator should be up to 80%, but the utility of combination of two
operators together is below 80% and hence instead of two operators, one can be used in this
stage.

There are 8 out of 20 production lines involves exact machine arrangement and
headcount allocation. So eight head count can be reduced.
Efficiency of the production line increases
Space provided for the eight persons in the shop floor is saved, as lean system insist on
the space effective utilization in the shop floor.

54

Cost of these eight production lines gets reduced.
8 Headcount *Rs 20,000(minimum)*12 months = 19,20,000 Rs/Annum can be saved
totally.


BIBLIOGRAPHY

Worldwide Webs:
www.wikipedia.org
www.nokia.com

Intranet:
Nokia Intranet.IE

Books:
Production, Planning & Control - Pearson Education
Lean Manufacturing: Principles & Tools - Rexroth, Bosch Groups

Research papers:
Lean Manufacturing Tools & Techniques - Fawaz Abdullah, University of South
Carolina
Headcount Live run Modeling - Deepak Loyola, Nokia Corporation
Balancing Mixed Model Assembly Line - Pravin Y, tambi, Lousiana University