Lucas_TVS Case Study

8/13/2019 Lucas_TVS Case Study

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Case Study on LUCAS-T

A Journey towards Manufacturing Excellence

PJKM&

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Bacground:

Lucas-TVS was set up in 1961 as a joint venture of Lucas Industries UK now Lu

T V Sundara" #yen$ar % Sons TVS!& India& to "anufacture Auto"otive '#ectric

*ucas +arity:

199) revenue* +,( .i##ion(

Products:

/ra0in$ Syste"s

iese# 2ue# Injection Syste"s

'#ectronic and '#ectrica# Syste"s

After-"ar0et product sa#es and service(

,EM +endor to:

Vo#vo

3ercedes-/en4

Vo#0swa$en

Audi

2ord

2iat

5eu$eot A#fa o"eo


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-+" is .ndia/s fourt# largest auto$oti0e co$onent $anufactu

Turnover in e7cess of s( )688 Cr(

5roducts*

Auto '#ectrica#s

/ra0in$ Syste"s Auto"otive :ee#s

A7#e 2asteners

iese# 2ue# Injection ';uip"ent

Two :ee#ers

India


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2urrent 2usto$ers of *ucas3-+":


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Auto '#ectrica#

5roducts* =ead#a"ps A#ternators ipers istri.utors yna"os Starters 5#ant Locations* 5adi C:ennai!

IS> 9881 and ?S9888 in 199,!

'ripa00a"5ondic:erry! ?S9888 in 1999!

ewari=aryana!

2ue# Injection';uip"ent

5roducts* iese# 2ue#

Injection';uip"ent

5#ant Locations* 3annur

C:ennai! IS>9881 and ?S9888 in 1999!

Lucas IndianServices

5roducts* Sa#es and

service of autoe#ectrica#s andfue# injectionsyste"s"anufactured .yLucas-TVS

Locations* @ e$iona#

.ranc:es in t:e@ "etros

/ranc:offices coverin$every "ajorstate

India Bippon'#ectrica#s Ltd(

IB'L!

V .etweenLucas IndianServices andKo0usan en0iCo( Ltd(& apanest( in 19)

5roducts* I$nition syste"s

for two w:ee#ersand porta.#e$ensets

5#ant Locations* =osur

/an$a#ore! IS>9881

4i0isions and Joint +entures:


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Before158%

3ar0etdo"inated.y

=industan3otors and5re"ierAuto"o.i#esLtd(

158% to155%

3arutiUdyo$Li"ited

3UL!captures)EF"ar0ets:are(

155%onwards

3ar0et is#i.era#i4edand

internationa#$iants #i0eG3& 2ord&=onda&3itsu.is:i&3ercedes-/en4&

=yundai&aewoo and2iat #aunc:passen$ercar "ode#sin India(

155% to1556

19(F$rowt:rate of

t:eIndianautoindustry

ecautodue

ecos#owTata

#aunIndi199spu

inteco"in t:car


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2#allenges in t#e .ndian Auto3co$onent .ndustry:

Two of t:e "ajor c:ar$es #eve##ed a$ainst t:e do"estic co"ponent "anufactur

t:ey lac 7uality consistency and deli0ery reliability(

ejection rate for Indian auto co"ponents is !599 arts er $illion 553

"ore t:an ten ti"es t:e wor#d #eve# of !'9 PPM(

'sti"ated su.-supp#iersH rejection rate is %199 PPM(

Entry of global co$onent $anufacturers(

Increasin$ s:ift towards reduction in 0endors(


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*2A" -+" Before 158

Challenges:

Crisscross material movement.

Lots of Work in Process(WIP) on shop

floor.

Roughly 30 of the processes !ere not

capa"le of meeting pro#uct specifications.

$re%uent "reak#o!ns of machinery.

Less focus of timely #elivery(#elivery

relia"ilities) &pro#uct %uality(#elivery

consistency).

'igh scrap levels (3)

Milling

M M

M M

M M

Assembly

A A

A A

Lathing

Receiving

and shipping

L

L L

L L

L L

L


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&eed for 2#ange

'ntry of 3aruti Udyo$ Ltd( 3UL! in 19)E increased "ar0et co"petition(

'ntry of wor#d c#ass co"ponent "anufacturers #i0e /osc: % Bippodenso tri$$

c:an$e(

So"e >'3


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2#ange Manage$ent "trategy

three mem"er task force is setup to recommen# an# #irect the changes !ithin Lucas*+,.

Recommen#ations of the three mem"er task force !ere-

Syste"s approac: to "anufacturin$(

2ocus on "a7i"i4in$ current resources - Lower priority to invest"ents in ne

'ffective trainin$ to wor0force(

'ncoura$e e"p#oyee en$a$e"ent t:rou$: for"ation of s"a## $roups Cont

I"prove"ent!

"This Padi facility at that time looked nothing like it looks today. We had a plant that was built in the e

it had to be considerably modified to transform it into a world-class facility. Howeer! in #$%! there w

&ndia that had gone through this kind of massie transformation. This posed considerable challenges t

C2 an# 4& Lucas*+,


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*ayout c#ange and E$loyee E$ower$ent

15831551

Measures -aen:

'"p#oyee 'n$a$e"ent was encoura$ed wit: t:e fo##owin$ "easures

'"p#oyee trainin$ in .atc:es of E8 at Tara"ani Trainin$ Centre on S5C&?2&23'A

Kai4en su$$estion sc:e"e started

Bews #etter in Ta"i# Siru Ku4:u C:eyt:i 3a#arJS"a## $roup news#etter!(

Sc:edu#e to c:an$e p#ant #ayout fro" process to product .ased #ayout was desi$ned saffect re$u#ar production(

;esults:

Bet wort: and sa#es per e"p#oyee dou.#ed wit: ne$#i$i.#e c:an$e in wor0force si4

5rocess #ayout c:an$ed to product #ayout

eduction in f#oor space occupied(

Increased no( of Inventory turnsDyear(

"This change that we need to undertake is not an option. This is something that is becoming ineita

- r * / ala1i& C2 an# 4& Lucas*+,


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Plant *ayout at adi in 158(Process layout)


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Plant layout at adi in 1555(Product layout)


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4or$ant eriod < i$ending c#allenges

15513155!

2#allenges:

rop in su$$estion sc:e"e fro" @E@ in 1998-91 to )E8 in 1991-9( ere$u#ation of "ar0et(

Increase in "ar0et si4e(

Increase in no( of co"petitors!(

ecession 5eriod(

Measures taen:

Low cost auto"ation(

Ba$are ce## for"ation(

;esult:

2ati$ue reduction(

Cyc#e ti"e reduction(

?ua#ity % productivity i"prove"ent(

"&n ##! after finishing the layout

we had achieed nirana. (ince we few companies to hae gone throug

there was a state of complacency w

about the improements achieed in

r ala1i& C2 an# 4& Lucas


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Ba$are ce## I"p#e"entation

"tatus after 2ell"tatus before 2ell

1 3KL Lat:e

Gi"pin$ 5ress

E @ ay ri##

@ S@ ri##

/enc:

Benefits

3anufacturin$ LeTi"e

3anpower

Transfer /atc: Si4

Space in S;( ft(


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>uality .nitiati0es

155!3155

2#allenges:

A.sence of IS> 9888 certification #i"ited "ar0et penetration( 3indset t:at ;ua#ity is t:e responsi.i#ity of on#y ?ua#ity Assurance depart"ent

Measures taen:

Stress on i"portance of ;ua#ity syste"s

3aintainin$ ?ua#ity contro# c:arts % visua# disp#ays(

2o##owin$ or0 Instructions and Standard >peratin$ 5rocedure S>5!(

efect prevention syste"s5o0a-o0e!

Continuous i"prove"ent p:i#osop:y(

;esults:

Award of IS> 9881 in 199E(

A##owed TVS-LUCAS to participate in $#o.a# tenders(

?S 9888 in >cto.er 199,(


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155 ,nwards

2#allenges:

=eavy co"petition a"on$ t:e >'3'3


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"*ll these improements in performance hae been achieed

only through the dedicated and tireless efforts of our managers

from top to bottom. The contribution by engineers in deelopingnew products and processes has been phenomenal. Without the

whole-hearted commitment from eery single employee at

+ucas-T,(! none of these changes would hae been possible.

cellence is a moing target and we can/t afford to remain

satisfied with our current achieements. We need to

continuously seek higher leels of ecellence. or the

challenges that we face ahead! we once again re1uireune1uiocal support from all our constituencies!"

2 r ala1i& C2 an# 4& Lucas*+,


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19)-

1991

1996

199,

8

A888

@888

6888

1,(9

@)()8(9

@,,(E

6)(9

111(E6,,(9

9)(E

9E(1

19,(9@E9 6EE(

=inancial "tatistics

Sa#es Bet of '7cise uty! Capita# '"p#oyed Gross 2i7ed Assets

?ear 158 1551 155 1556

"ales (&et of Excise 4uty) 689() 1,(9 @)() 8(9

2aital E$loyed )@(@ 6)(9 111(E 6,,(9

&et @ort# ,( @18() 1)@(, E6)(@

ross =ixed Assets )(9 9E(1 19,(9 @E9(8


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19

)

199

8

1888

A88

8

E888

@888

689()

1@66(9

@E8

,,8

E18 E86

88

88

Production and ;e0enue 0s E$loyee "trengt#

Sa#es Va#ue Annua# 5roduct ion '"p#oyee St ren$t: Sa#es p

nit 158 1551

"ales +alue s( In 3i##ion 689() 1@66(9

Annual ProductionT:ousands of

units@E8 ,,8

E$loyee "trengt# Bos( E18 E86

"ales er E$loyees( in

T:ousand88 88


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19

)-

19

91

1

18

188

1888

18888

@888

@8

@8

18

@(,(

factory erfor$ance $easures

Lot S i4es Typica# Setup Ti"e Inventory Turns

nit 158 1551

*ot "iDes Bos( @888 @8

-yical "etu -i$e 3inute @8(8 18(8

.n0entory -urns @( ,(


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19

)-

19

91

8

A

@

6

)

18

1A

18

E(E(9,

1(

8(

Process erfor$ance $easures

eject ions Scrap ownti"e

nit 158 1551

;eections F 18(8 E(E

"cra F E(8 1(

4ownti$e F (8 8(


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19

)-

19

91

8

-88

1888

1-88

,(

@@(61

@81

18,(E

"a0ings $easured

Capita# '"p#oyed 2#oor Space Ut i # i4at ion Annua# Savin$s fro"

nit 158 1551

2aital E$loyed s( In 3i##ion ,( @@(6=loor "acetiliDation

S;(ft(Ds( 1 @

Annual "a0ings fro$

"uggestionss( In T:ousand 81(8 18,(E

;eco$$endations:


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;eco$$endations:


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-FA&K ?,GG

Lucas_TVS Case Study

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